10-Q

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

September 30, 2020

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

001-38004

Invitation Homes Inc.

(Exact name of registrant as specified in its charter)

Maryland

90-0939055

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)

1717 Main Street,

Suite 2000

75201

Dallas,

Texas

(Address of principal executive offices)

(Zip Code)

(972)

421-3600

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

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

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common stock, $0.01 par value

INVH

New 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.

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).

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.

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. ☐

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

Yes

☐

No

☑

As of October 26, 2020, there were 560,534,032 shares of common stock, par value $0.01 per share, outstanding.

INVITATION HOMES INC.

			Page
PART I
Item	1.	Financial Statements	6
Item	2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	40
Item	3.	Quantitative and Qualitative Disclosures About Market Risk	70
Item	4.	Controls and Procedures	70
PART II
Item	1.	Legal Proceedings	72
Item	1A.	Risk Factors	72
Item	2.	Unregistered Sales of Equity Securities and Use of Proceeds	74
Item	3.	Defaults Upon Senior Securities	74
Item	4.	Mine Safety Disclosures	74
Item	5.	Other Information	74
Item	6.	Exhibits	75
Signatures			76

FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which include, but are not limited to, statements related to our expectations regarding the performance of our business, our financial results, our liquidity and capital resources, and other non-historical statements. In some cases, you can identify these forward-looking statements by the use of words such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “could,” “seeks,” “projects,” “predicts,” “intends,” “plans,” “estimates,” “anticipates,” or the negative version of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties, including, among others, risks inherent to the single-family rental industry and our business model, macroeconomic factors beyond our control, competition in identifying and acquiring properties, competition in the leasing market for quality residents, increasing property taxes, homeowners’ association (“HOA”) and insurance costs, our dependence on third parties for key services, risks related to the evaluation of properties, poor resident selection and defaults and non-renewals by our residents, performance of our information technology systems, risks related to our indebtedness, and risks related to the potential negative impact of the ongoing COVID-19 pandemic on our financial condition, results of operations, cash flows, business, associates, and residents. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. Many of these factors have been heightened as a result of the ongoing and numerous adverse impacts of COVID-19. We believe these factors include but are not limited to, those described under Part I. Item 1A. “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2019 (the “Annual Report on Form 10-K”) and under Part II. Item 1A. “Risk Factors” in this Quarterly Report on Form 10-Q as such factors may be updated from time to time in our periodic filings with the Securities and Exchange Commission (the “SEC”), which are accessible on the SEC’s website at http://www.sec.gov. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this Quarterly Report on Form 10-Q, in the Annual Report on Form 10-K, and in our other periodic filings. The forward-looking statements speak only as of the date of this Quarterly Report on Form 10-Q, and we expressly disclaim any obligation or undertaking to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except to the extent otherwise required by law.

3

DEFINED TERMS

Invitation Homes Inc. (“INVH”), a real estate investment trust (“REIT”), conducts its operations through Invitation Homes Operating Partnership LP (“INVH LP”). THR Property Management L.P., a wholly owned subsidiary of INVH LP (the “Manager”), provides all management and other administrative services with respect to the properties we own. On November 16, 2017 (the “Merger Date”), INVH and certain of its affiliates entered into a series of transactions with Starwood Waypoint Homes (“SWH”) and certain SWH affiliates which resulted in SWH and its operating partnership being merged into INVH and INVH LP, respectively, with INVH and INVH LP being the surviving entities (the “Mergers”).

Unless the context suggests otherwise, references in this Quarterly Report on Form 10-Q to “Invitation Homes,” the “Company,” “we,” “our,” and “us” refer to INVH and its consolidated subsidiaries.

In this Quarterly Report on Form 10-Q:

•“average monthly rent” represents average monthly rental income per home for occupied properties in an identified population of homes over the measurement period and reflects the impact of non-service rent concessions and contractual rent increases amortized over the life of the related lease. We believe average monthly rent reflects pricing trends that significantly impact rental revenues over time, making average monthly rent useful to management and external stakeholders as a means of evaluating changes in rental revenues across periods;

•“average occupancy” for an identified population of homes represents (i) the total number of days that the homes in such population were occupied during the measurement period, divided by (ii) the total number of days that the homes in such population were owned during the measurement period. We believe average occupancy significantly impacts rental revenues in a given period, making comparisons of average occupancy across different periods helpful to management and external stakeholders in evaluating changes in rental revenues across periods;

•“Carolinas” includes Charlotte, NC, Greensboro, NC, Raleigh, NC, and Fort Mill, SC;

•“days to re-resident” for an individual home represents the number of days between (i) the date the prior resident moves out of a home, and (ii) the date the next resident is granted access to the same home, which is deemed to be the earlier of the next resident’s contractual lease start date and the next resident’s move-in date. Days to re-resident impacts our average occupancy and thus our rental revenues, making comparisons of days to re-resident helpful to management and external stakeholders in evaluating changes in rental revenues across periods;

•“in-fill” refers to markets, MSAs, submarkets, neighborhoods or other geographic areas that are typified by significant population densities and low availability of land suitable for development into competitive properties, resulting in limited opportunities for new construction;

•“historical average” is the simple average of each of the six months beginning October 2019 and to and including March 2020;

•“Metropolitan Statistical Area” or “MSA” is defined by the United States Office of Management and Budget as a region associated with at least one urbanized area that has a population of at least 50,000 and comprises the central county or counties containing the core, plus adjacent outlying counties having a high degree of social and economic integration with the central county or counties as measured through commuting;

•“net effective rental rate growth” for any home represents the percentage difference between the monthly rent from an expiring lease and the monthly rent from the next lease and, in each case, reflects the impact of non-service rent concessions and contractual rent increases amortized over the life of the related lease. Leases are either renewal leases, where our current resident chooses to stay for a subsequent lease term, or a new lease, where our previous resident moves out and a new resident signs a lease to occupy the same home. Net effective rental rate growth drives changes in our average monthly rent, making net effective rental rate growth useful to management and external stakeholders as a means of evaluating changes in rental revenues across periods;

•“Northern California” includes Sacramento-Arden-Arcade-Roseville, CA, San Francisco-Oakland-Hayward, CA, Stockton-Lodi, CA, Vallejo-Fairfield, CA, and Yuba City, CA;

4

•“PSF” means per square foot. When comparing homes or cohorts of homes, we believe PSF calculations help management and external stakeholders normalize metrics for differences in property size, enabling more meaningful comparisons based on characteristics other than property size;

•“revenue collections as a percentage of monthly billings” represents the total cash received in a given monthly period for rental revenues and other property income (including receipt of late payments that were billed in prior months) divided by the total amounts billed in that period. When a payment plan is in place with a resident, amounts are considered to be billed at the time they would have been billed based on the terms of the original lease, not the terms of the payment plan. We believe this provides management and external stakeholders with meaningful information about our success in collecting amounts due under our lease agreements;

•“Same Store” or “Same Store portfolio” includes, for a given reporting period, homes that have been stabilized and seasoned, excluding homes that have been sold, homes that have been identified for sale to an owner occupant and have become vacant, homes that have been deemed inoperable or significantly impaired by casualty loss events or force majeure, homes acquired in portfolio transactions that are deemed not to have undergone renovations of sufficiently similar quality and characteristics as the existing Invitation Homes Same Store portfolio, and homes in markets that we have announced an intent to exit where we no longer operate a significant number of homes for the primary purpose of income generation. Homes are considered stabilized if they have (i) completed an initial renovation and (ii) entered into at least one post-initial renovation lease. An acquired portfolio that is both leased and deemed to be of sufficiently similar quality and characteristics as the existing Invitation Homes Same Store portfolio may be considered stabilized at the time of acquisition. Homes are considered to be seasoned once they have been stabilized for at least 15 months prior to January 1st of the year in which the Same Store portfolio was established. We believe information about the portion of our portfolio that has been fully operational for the entirety of a given reporting period and its prior year comparison period provides management and external stakeholders with meaningful information about the performance of our comparable homes across periods and about trends in our organic business;

•“Southeast United States” includes our Atlanta and Carolinas markets;

•“South Florida” includes Miami-Fort Lauderdale-West Palm Beach, FL, and Port St. Lucie, FL;

•“Southern California” includes Los Angeles-Long Beach-Anaheim, CA, Oxnard-Thousand Oaks-Ventura, CA, Riverside-San Bernardino-Ontario, CA, and San Diego-Carlsbad, CA;

•“total homes” or “total portfolio” refers to the total number of homes we own, whether or not stabilized, and excludes any properties previously acquired in purchases that have been subsequently rescinded or vacated. Unless the context otherwise requires, all measures in this Quarterly Report on Form 10-Q are presented on a total portfolio basis;

•“turnover rate” represents the number of instances that homes in an identified population become unoccupied in a given period, divided by the number of homes in such population. To the extent the measurement period shown is less than 12 months, the turnover rate may be reflected on an annualized basis. We believe turnover rate impacts average occupancy and thus our rental revenues, making comparisons of turnover rate helpful to management and external stakeholders in evaluating changes in rental revenues across periods. In addition, turnover can impact our cost to maintain homes, making changes in turnover rate useful to management and external stakeholders in evaluating changes in our property operating and maintenance expenses across periods; and

•“Western United States” includes our Southern California, Northern California, Seattle, Phoenix, Las Vegas, and Denver markets.

5

PART I

ITEM 1. FINANCIAL STATEMENTS

INVITATION HOMES INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except shares and per share data)

	September 30, 2020		December 31, 2019
	(unaudited)
Assets:
Investments in single-family residential properties:
Land	$	4,501,831	$	4,499,346
Building and improvements	14,011,329		13,747,818
	18,513,160		18,247,164
Less: accumulated depreciation	(2,381,059)		(2,003,972)
Investments in single-family residential properties, net	16,132,101		16,243,192
Cash and cash equivalents	559,567		92,258
Restricted cash	249,341		193,987
Goodwill	258,207		258,207
Other assets, net	551,571		605,266
Total assets	$	17,750,787	$	17,392,910
Liabilities:
Mortgage loans, net	$	6,094,980	$	6,238,461
Secured term loan, net	401,040		400,978
Term loan facility, net	1,495,913		1,493,747
Revolving facility	—		—
Convertible senior notes, net	338,112		334,299
Accounts payable and accrued expenses	261,355		186,110
Resident security deposits	155,871		147,787
Other liabilities	672,139		325,450
Total liabilities	9,419,410		9,126,832
Commitments and contingencies (Note 14)
Equity:
Stockholders' equity
Preferred stock, $0.01 par value per share, 900,000,000 shares authorized, none outstanding as of September 30, 2020 and December 31, 2019	—		—
Common stock, $0.01 par value per share, 9,000,000,000 shares authorized, 560,534,032 and 541,642,725 outstanding as of September 30, 2020 and December 31, 2019, respectively	5,605		5,416
Additional paid-in capital	9,521,179		9,010,194
Accumulated deficit	(646,950)		(524,588)
Accumulated other comprehensive loss	(598,966)		(276,600)
Total stockholders' equity	8,280,868		8,214,422
Non-controlling interests	50,509		51,656
Total equity	8,331,377		8,266,078
Total liabilities and equity	$	17,750,787	$	17,392,910

The accompanying notes are an integral part of these condensed consolidated financial statements.

6

INVITATION HOMES INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except shares and per share data)

(unaudited)

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2020		2019		2020		2019
Rental revenues and other property income	$	459,184	$	443,326	$	1,358,728	$	1,320,408
Expenses:
Property operating and maintenance	177,997		175,491		511,915		502,411
Property management expense	14,824		15,872		43,725		47,053
General and administrative	17,972		16,405		46,626		58,899
Interest expense	87,713		89,067		258,541		278,756
Depreciation and amortization	138,147		133,315		410,440		399,955
Impairment and other	1,723		4,740		4,670		11,803
Total expenses	438,376		434,890		1,275,917		1,298,877
Other, net	(3,049)		4,735		2,035		8,470
Gain on sale of property, net of tax	15,106		20,812		41,473		64,556
Net income	32,865		33,983		126,319		94,557
Net income attributable to non-controlling interests	(211)		(276)		(806)		(1,086)
Net income attributable to common stockholders	32,654		33,707		125,513		93,471
Net income available to participating securities	(114)		(91)		(335)		(306)
Net income available to common stockholders — basic and diluted (Note 12)	$	32,540	$	33,616	$	125,178	$	93,165
Weighted average common shares outstanding — basic	560,598,995		537,771,245		550,722,684		528,209,033
Weighted average common shares outstanding — diluted	561,871,373		538,644,888		551,947,278		529,160,353
Net income per common share — basic	$	0.06	$	0.06	$	0.23	$	0.18
Net income per common share — diluted	$	0.06	$	0.06	$	0.23	$	0.18

The accompanying notes are an integral part of these condensed consolidated financial statements.

7

INVITATION HOMES INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(in thousands)

(unaudited)

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2020		2019		2020		2019
Net income	$	32,865	$	33,983	$	126,319	$	94,557
Other comprehensive income (loss)
Unrealized losses on interest rate swaps	(4,171)		(71,729)		(398,426)		(308,196)
(Gains) losses from interest rate swaps reclassified into earnings from accumulated other comprehensive loss	37,557		(4,272)		74,166		(23,026)
Other comprehensive income (loss)	33,386		(76,001)		(324,260)		(331,222)
Comprehensive income (loss)	66,251		(42,018)		(197,941)		(236,665)
Comprehensive (income) loss attributable to non-controlling interests	(415)		371		1,088		2,954
Comprehensive income (loss) attributable to common stockholders	$	65,836	$	(41,647)	$	(196,853)	$	(233,711)

The accompanying notes are an integral part of these condensed consolidated financial statements.

8

INVITATION HOMES INC.

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

For the Three and Nine Months Ended September 30, 2020

(in thousands, except share and per share data)

(unaudited)

	Common Stock
	Number of Shares	Amount		Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Loss		Total Stockholders' Equity		Non-Controlling Interests		Total Equity
Balance as of June 30, 2020	560,532,679	$	5,605	$	9,515,625	$	(595,318)	$	(632,148)	$	8,293,764	$	50,109	$	8,343,873
Capital distributions	—	—		—		—		—		—		(535)		(535)
Net income	—	—		—		32,654		—		32,654		211		32,865
Dividends and dividend equivalents declared ($0.15 per share)	—	—		—		(84,286)		—		(84,286)		—		(84,286)
Issuance of common stock — settlement of RSUs, net of tax	1,353	—		(12)		—		—		(12)		—		(12)
Share-based compensation expense	—	—		5,566		—		—		5,566		520		6,086
Total other comprehensive loss	—	—		—		—		33,182		33,182		204		33,386
Balance as of September 30, 2020	560,534,032	$	5,605	$	9,521,179	$	(646,950)	$	(598,966)	$	8,280,868	$	50,509	$	8,331,377

	Common Stock
	Number of Shares	Amount		Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Loss		Total Stockholders' Equity		Non-Controlling Interests		Total Equity
Balance as of December 31, 2019	541,642,725	$	5,416	$	9,010,194	$	(524,588)	$	(276,600)	$	8,214,422	$	51,656	$	8,266,078
Capital distributions	—	—		—		—		—		—		(1,603)		(1,603)
Net income	—	—		—		125,513		—		125,513		806		126,319
Dividends and dividend equivalents declared ($0.45 per share)	—	—		—		(247,875)		—		(247,875)		—		(247,875)
Issuance of common stock — settlement of RSUs, net of tax	328,841	3		(3,376)		—		—		(3,373)		—		(3,373)
Issuance of common stock, net	18,562,466	186		503,612		—		—		503,798		—		503,798
Share-based compensation expense	—	—		10,749		—		—		10,749		1,544		12,293
Total other comprehensive loss	—	—		—		—		(322,366)		(322,366)		(1,894)		(324,260)
Balance as of September 30, 2020	560,534,032	$	5,605	$	9,521,179	$	(646,950)	$	(598,966)	$	8,280,868	$	50,509	$	8,331,377

The accompanying notes are an integral part of these condensed consolidated financial statements.

9

INVITATION HOMES INC.

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (continued)

For the Three and Nine Months Ended September 30, 2019

(in thousands, except share and per share data)

(unaudited)

	Common Stock
	Number of Shares	Amount		Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Loss		Total Stockholders' Equity		Non-Controlling Interests		Total Equity
Balance as of June 30, 2019	525,126,947	$	5,251	$	8,686,927	$	(469,129)	$	(265,370)	$	7,957,679	$	79,789	$	8,037,468
Capital distributions	—	—		—		—		—		—		(724)		(724)
Net income	—	—		—		33,707		—		33,707		276		33,983
Dividends and dividend equivalents declared ($0.13 per share)	—	—		—		(70,465)		—		(70,465)		—		(70,465)
Issuance of common stock — settlement of RSUs, net of tax	4,775	—		(56)		—		—		(56)		—		(56)
Issuance of common stock — settlement of 2019 Convertible Notes	12,553,864	126		229,818		—		—		229,944		—		229,944
Issuance of common stock, net — ATM Equity Program	671,020	7		17,730		—		—		17,737		—		17,737
Share-based compensation expense	—	—		4,068		—		—		4,068		557		4,625
Total other comprehensive loss	—	—		—		—		(75,354)		(75,354)		(647)		(76,001)
Balance as of September 30, 2019	538,356,606	$	5,384	$	8,938,487	$	(505,887)	$	(340,724)	$	8,097,260	$	79,251	$	8,176,511

	Common Stock
	Number of Shares	Amount		Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Loss		Total Stockholders' Equity		Non-Controlling Interests		Total Equity
Balance as of December 31, 2018	520,647,977	$	5,206	$	8,629,462	$	(392,594)	$	(12,963)	$	8,229,111	$	140,075	$	8,369,186
Capital distributions	—	—		—		—		—		—		(2,610)		(2,610)
Net income	—	—		—		93,471		—		93,471		1,086		94,557
Dividends and dividend equivalents declared ($0.39 per share)	—	—		—		(206,764)		—		(206,764)		—		(206,764)
Issuance of common stock — settlement of RSUs, net of tax	910,452	9		(8,173)		—		—		(8,164)		—		(8,164)
Issuance of common stock — settlement of 2019 Convertible Notes	12,553,864	126		229,818		—		—		229,944		—		229,944
Issuance of common stock, net — ATM Equity Program	671,020	7		17,730		—		—		17,737		—		17,737
Share-based compensation expense	—	—		12,930		—		—		12,930		917		13,847
Total other comprehensive loss	—	—		—		—		(327,182)		(327,182)		(4,040)		(331,222)
Redemption of OP Units for common stock	3,573,293	36		56,720		—		(579)		56,177		(56,177)		—
Balance as of September 30, 2019	538,356,606	$	5,384	$	8,938,487	$	(505,887)	$	(340,724)	$	8,097,260	$	79,251	$	8,176,511

The accompanying notes are an integral part of these condensed consolidated financial statements.

10

INVITATION HOMES INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)

	For the Nine Months Ended September 30,
	2020		2019
Operating Activities:
Net income	$	126,319	$	94,557
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	410,440		399,955
Share-based compensation expense	12,293		13,847
Amortization of deferred leasing costs	8,830		7,708
Amortization of deferred financing costs	18,153		29,386
Amortization of debt discounts	4,077		6,026
Provisions for impairment	4,202		11,289
Gain on sale of property, net of tax	(41,473)		(64,556)
Change in fair value of derivative instruments	4,410		2,010
Other non-cash amounts included in net income	1,814		883
Changes in operating assets and liabilities:
Other assets, net	(22,300)		(4,218)
Accounts payable and accrued expenses	82,971		95,748
Resident security deposits	8,084		28
Other liabilities	7,852		(1,815)
Net cash provided by operating activities	625,672		590,848
Investing Activities:
Amounts deposited and held by others	(4,046)		(5,572)
Acquisition of single-family residential properties	(337,415)		(405,142)
Initial renovations to single-family residential properties	(71,666)		(35,017)
Other capital expenditures for single-family residential properties	(127,702)		(118,423)
Proceeds from sale of single-family residential properties	338,486		493,224
Repayment proceeds from retained debt securities	8,133		40,034
Other investing activities	(165)		4,325
Net cash used in investing activities	(194,375)		(26,571)
Financing Activities:
Payment of dividends and dividend equivalents	(247,651)		(206,764)
Distributions to non-controlling interests	(1,603)		(2,610)
Payment of taxes related to net share settlement of RSUs	(3,373)		(8,164)
Payments on mortgage loans	(157,791)		(798,415)
Proceeds from secured term loan	—		403,464
Payments on secured term loan	(101)		—
Proceeds from revolving facility	320,000		215,000
Payments on revolving facility	(320,000)		(215,000)
Proceeds from issuance of common stock, net	503,798		17,737
Deferred financing costs paid	—		(2,613)
Other financing activities	(1,913)		(490)
Net cash provided by (used in) financing activities	91,366		(597,855)
Change in cash, cash equivalents, and restricted cash	522,663		(33,578)
Cash, cash equivalents, and restricted cash, beginning of period (Note 4)	286,245		359,991
Cash, cash equivalents, and restricted cash, end of period (Note 4)	$	808,908	$	326,413

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INVITATION HOMES INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)

(in thousands)

(unaudited)

	For the Nine Months Ended September 30,
	2020		2019
Supplemental cash flow disclosures:
Interest paid, net of amounts capitalized	$	236,714	$	249,085
Cash paid for income taxes	1,284		2,320
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	4,117		4,056
Financing cash flows from finance leases	1,714		379
Non-cash investing and financing activities:
Accrued renovation improvements at period end	$	6,273	$	5,724
Accrued residential property capital improvements at period end	10,677		15,429
Transfer of residential property, net to other assets, net for held for sale assets	134,361		490,397
Change in other comprehensive loss from cash flow hedges	(328,472)		(333,135)
ROU assets obtained in exchange for operating lease liabilities	4,617		1,721
ROU assets obtained in exchange for finance lease liabilities	9,484		—
Net settlement of 2019 Convertible Notes in shares of common stock	—		229,944

The accompanying notes are an integral part of these condensed consolidated financial statements.

12

INVITATION HOMES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

(unaudited)

Note 1—Organization and Formation

Invitation Homes Inc. (“INVH”) is a real estate investment trust (“REIT”) that conducts its operations through Invitation Homes Operating Partnership LP (“INVH LP”). INVH LP was formed for the purpose of owning, renovating, leasing, and operating single-family residential properties. Through THR Property Management L.P., a wholly owned subsidiary of INVH LP (the “Manager”), we provide all management and other administrative services with respect to the properties we own.

On February 6, 2017, INVH completed an initial public offering (“IPO”), changed its jurisdiction of incorporation to Maryland, and amended its charter to provide for the issuance of up to 9,000,000,000 shares of common stock and 900,000,000 shares of preferred stock, in each case $0.01 par value per share. In connection with certain pre-IPO reorganization transactions, INVH LP became (1) owned by INVH directly and through Invitation Homes OP LLC, a wholly owned subsidiary of INVH, and (2) the owner of all of the assets, liabilities, and operations of certain pre-IPO ownership entities. These transactions were accounted for as a reorganization of entities under common control utilizing historical cost basis.

On November 16, 2017 (the “Merger Date”), INVH and certain of its affiliates entered into a series of transactions with Starwood Waypoint Homes (“SWH”) and certain SWH affiliates which resulted in SWH and its operating partnership being merged into INVH and INVH LP, respectively, with INVH and INVH LP being the surviving entities (the “Mergers”). The Mergers were accounted for as a business combination in accordance with ASC 805, Business Combinations, and INVH was designated as the accounting acquirer.

The limited partnership interests of INVH LP consist of common units and other classes of limited partnership interests that may be issued (the “OP Units”). As of September 30, 2020, INVH owns 99.4% of the common OP Units and has the full, exclusive, and complete responsibility for and discretion over the day to day management and control of INVH LP.

Our organizational structure includes several wholly owned subsidiaries of INVH LP that were formed to facilitate certain of our financing arrangements (the “Borrower Entities”). These Borrower Entities are used to align the ownership of our single-family residential properties with certain of our debt instruments. Collateral for certain of our individual debt instruments may be in the form of equity interests in the Borrower Entities or in pools of single-family residential properties owned either directly by the Borrower Entities or indirectly by their wholly owned subsidiaries (see Note 6).

References to “Invitation Homes,” the “Company,” “we,” “our,” and “us” refer, collectively, to INVH, INVH LP, and the consolidated subsidiaries of INVH LP.

Note 2—Significant Accounting Policies

Basis of Presentation

The accompanying interim condensed consolidated financial statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and with the rules and regulations of the Securities and Exchange Commission for interim financial information and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements and should be read in conjunction with our audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2019.

These condensed consolidated financial statements include the accounts of INVH and its consolidated subsidiaries. All intercompany accounts and transactions have been eliminated in the condensed consolidated financial statements. In the opinion of management, all adjustments that are of a normal recurring nature considered necessary for a fair presentation of our interim financial statements have been included in these condensed consolidated financial statements. Operating results for the nine months ended September 30, 2020 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2020.

13

INVITATION HOMES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

(unaudited)

We consolidate entities when we own, directly or indirectly, a majority interest in the entity or are otherwise able to control the entity. We consolidate variable interest entities (“VIEs”) in accordance with ASC 810, Consolidation, if we are the primary beneficiary of the VIE as determined by our power to direct the VIE’s activities and the obligation to absorb its losses or the right to receive its benefits, which are potentially significant to the VIE. A VIE is broadly defined as an entity with one or more of the following characteristics: (a) the total equity investment at risk is insufficient to finance the entity’s activities without additional subordinated financial support; (b) as a group, the holders of the equity investment at risk lack (i) the ability to make decisions about the entity’s activities through voting or similar rights, (ii) the obligation to absorb the expected losses of the entity, or (iii) the right to receive the expected residual returns of the entity; or (c) the equity investors have voting rights that are not proportional to their economic interests, and substantially all of the entity’s activities either involve, or are conducted on behalf of, an investor that has disproportionately few voting rights.

As described in Note 5, we have an investment in a joint venture with the Federal National Mortgage Association (“FNMA”), which is a voting interest entity. We do not hold a controlling financial interest in the joint venture but have significant influence over its operating and financial policies. Additionally, FNMA holds certain substantive participating rights that preclude the presumption of control by us; as such, we account for our investment using the equity method. In connection with the Mergers, we initially recorded this investment at fair value in connection with purchase accounting and have subsequently adjusted for our proportionate share of net earnings or losses and other comprehensive income or loss, cash contributions made and distributions received, and other adjustments, as appropriate. Distributions of operating profit from the joint venture are reported as part of operating cash flows while distributions related to a capital transaction, such as a refinancing transaction or sale, are reported as investing activities.

Non-controlling interests represent the OP Units not owned by INVH, including any vested OP Units granted in connection with certain share-based compensation awards. Non-controlling interests are presented as a separate component of equity on the condensed consolidated balance sheets as of September 30, 2020 and December 31, 2019, and the condensed consolidated statements of operations for the three and nine months ended September 30, 2020 include an allocation of the net income attributable to the non-controlling interest holders. Vested OP Units are redeemable for shares of our common stock on a one-for-one basis or, in our sole discretion, cash, and redemptions of OP Units are accounted for as a reduction in non-controlling interests with an offset to stockholders’ equity based on the pro rata number of OP Units redeemed.

Significant Risks and Uncertainties

One of the most significant risks and uncertainties to our financial condition and results of operations is the potential adverse effect of the ongoing pandemic resulting from the coronavirus, or COVID-19. Since the outbreak, a number of our residents have requested rent deferral and/or late fee relief, and components of our rental revenues and other property income have been impacted by the pandemic. In addition, entities directed by, or notionally affiliated with, the Federal government as well as some jurisdictions across the United States have imposed temporary eviction moratoriums and are allowing residents to defer missed rent payments without incurring late fees, and jurisdictions and other local and national authorities may expand or extend measures imposing restrictions on our ability to enforce residents’ contractual rental obligations and limiting our ability to increase rents. We cannot predict if states, municipalities, local, and/or national authorities will expand existing restrictions, if additional states or municipalities will implement similar restrictions, or when restrictions currently in place will expire. Certain other restrictions imposed by jurisdictions across the United States are intended to limit operations by businesses not deemed “essential businesses.” While none of the current restrictions have materially impacted our ability to provide services to our residents or homes, future measures may negatively impact our ability to access our homes, complete service requests, or make our homes ready for new residents.

The COVID-19 pandemic could have material and adverse effects on our financial condition, results of operations, and cash flows in the near term due to, but not limited to, the following: (1) reduced economic activity that severely impacts the earnings or health of our residents, thereby causing them to be unable to fully meet their obligations to us and resulting in increases in uncollectible revenues and thus reductions in rental revenues and other property income; (2) governmental restrictions and moratoriums that negatively impact our ability to charge and collect rental revenues and other property income or impose restrictions on our ability to provide services to our residents and homes; (3) negative financial impact of the pandemic that could impact our ability to access funds available under our Revolving Facility (as defined in Note 6) or affect future compliance with financial covenants of our Credit Facility (as defined in Note 6) and other debt agreements; and (4) weaker economic conditions that could cause us to recognize impairments in value of our tangible assets or goodwill.

14

INVITATION HOMES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

(unaudited)

The extent to which the COVID-19 pandemic ultimately impacts our operations depends on ongoing developments, which remain highly uncertain and cannot be predicted with confidence, including the scope, severity, and duration of the pandemic, the extent and duration of actions taken to contain the pandemic or mitigate its impact, and the direct and indirect economic effects of the pandemic, containment measures, monetary and/or fiscal policies implemented to provide support or relief to businesses and/or residents, and other government, regulatory, and/or legislative changes precipitated by the COVID-19 pandemic, among others. While we have taken steps to mitigate the impact of the pandemic on our results of operations, there can be no assurance that these efforts will be successful.

Adoption of New Accounting Standards

In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which changes how companies measure credit losses for certain financial assets, excluding receivables arising from operating leases. This guidance requires an entity to estimate its expected credit loss and record an allowance based on this estimate so that it is presented at the net amount expected to be collected on the financial asset. We adopted this standard as of January 1, 2020, and it did not have a material impact on our condensed consolidated financial statements.

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848) (“ASU 2020-04”), which contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives, and other contracts. The guidance in ASU 2020-04 is optional and may be elected over time as reference rate reform activities occur. We have elected to apply the hedge accounting expedients related to probability and the assessments of effectiveness for future London Interbank Offer Rate (“LIBOR”) indexed cash flows to assume that the index upon which future hedged transactions will be based matches the index on the corresponding derivatives. Application of these expedients preserves the presentation of derivatives consistent with past presentation. We continue to evaluate the impact of the guidance and may apply other elections as applicable as additional changes in the market occur.

In April 2020, the FASB staff issued a question and answer document (the “Lease Modification Q&A”) focused on the application of lease accounting guidance to lease accommodations resulting from the COVID-19 pandemic as many lessors have been asked to provide rent deferrals, rent abatements, late fee waivers, and other lease concessions to lessees (collectively, “lease accommodations”). While the lease modification guidance in ASC 842, Leases, addresses routine changes to lease terms resulting from negotiations between a lessee and lessor, it did not contemplate the rapid implementation of lease accommodations to address the sudden liquidity constraints of some lessees arising from the COVID-19 pandemic.

Under existing lease guidance, we would have been required to determine, on a lease by lease basis, if each lease accommodation resulted from a new arrangement reached with the resident (treated within the lease modification accounting framework) or if each was contemplated under the enforceable rights and obligations within the existing lease agreement (precluded from applying the lease modification accounting framework). If certain criteria are met, the Lease Modification Q&A allows lessors to bypass the lease by lease analysis and instead elect to either apply the lease modification accounting framework or not, with such election applied consistently to leases with similar characteristics and similar circumstances. We elected to apply the Lease Modification Q&A guidance not to perform a lease by lease analysis with respect to any lease accommodations and to account for such accommodations outside of the lease modification framework. The Lease Modification Q&A has not had a material impact on our condensed consolidated financial statements for the three and nine months ended September 30, 2020. However, the extent of lease accommodations granted to residents as a result of the COVID-19 pandemic in future periods may materially affect our condensed consolidated financial statements.

Use of Estimates

The preparation of the condensed consolidated financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements, as well as the reported amounts of revenues and expenses during the reporting periods. These estimates are inherently subjective in nature and actual results could differ from those estimates.

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INVITATION HOMES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

(unaudited)

Accounting Policies

There have been no changes to our significant accounting policies that have had a material impact on our condensed consolidated financial statements and related notes, compared to those policies disclosed in our audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2019.

Recent Accounting Pronouncements

In August 2020, the FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”), which simplifies an issuer’s accounting for convertible instruments and contracts in its own equity. The guidance reduces the number of accounting models for convertible instruments, requires entities to use the “if-converted” method in diluted earnings (loss) per share (“EPS”), and requires that the effect of potential share settlement be included in the diluted EPS calculation when an instrument may be settled in cash or shares. The new standard will be effective for annual reporting periods beginning after December 15, 2021, and interim periods within that reporting period, with early adoption permitted beginning after December 15, 2020 and interim periods within that reporting period. Our 2022 Convertible Notes (as defined in Note 6) are the only instruments we have that will be subject to ASU 2020-06, and these notes mature on January 15, 2022. As such, ASU 2020-06 will not materially affect our condensed consolidated financial statements.

Note 3—Investments in Single-Family Residential Properties

The following table sets forth the net carrying amount associated with our properties by component:

	September 30, 2020		December 31, 2019
Land	$	4,501,831	$	4,499,346
Single-family residential property	13,386,936		13,121,179
Capital improvements	511,034		513,269
Equipment	113,359		113,370
Total gross investments in the properties	18,513,160		18,247,164
Less: accumulated depreciation	(2,381,059)		(2,003,972)
Investments in single-family residential properties, net	$	16,132,101	$	16,243,192

As of September 30, 2020 and December 31, 2019, the carrying amount of the residential properties above includes $119,292 and $119,608, respectively, of capitalized acquisition costs (excluding purchase price), along with $67,483 and $65,747, respectively, of capitalized interest, $26,541 and $25,565, respectively, of capitalized property taxes, $4,639 and $4,616, respectively, of capitalized insurance, and $3,023 and $2,836, respectively, of capitalized homeowners’ association (“HOA”) fees.

During the three months ended September 30, 2020 and 2019, we recognized $136,517 and $132,266, respectively, of depreciation expense related to the components of the properties, and $1,630 and $1,049, respectively, of depreciation and amortization related to corporate furniture and equipment. These amounts are included in depreciation and amortization in the condensed consolidated statements of operations. Further, during the three months ended September 30, 2020 and 2019, impairments totaling $289 and $3,960, respectively, have been recognized and are included in impairment and other in the condensed consolidated statements of operations. See Note 11 for additional information regarding these impairments.

During the nine months ended September 30, 2020 and 2019, we recognized $406,078 and $396,568, respectively, of depreciation expense related to the components of the properties and $4,362 and $3,387, respectively, of depreciation and amortization related to corporate furniture and equipment. These amounts are included in depreciation and amortization in the condensed consolidated statements of operations. Further, during the nine months ended September 30, 2020 and 2019, impairments totaling $4,202 and $11,289, respectively, have been recognized and are included in impairment and other in the condensed consolidated statements of operations. See Note 11 for additional information regarding these impairments.

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INVITATION HOMES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

(unaudited)

Note 4—Cash, Cash Equivalents, and Restricted Cash

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

	September 30, 2020		December 31, 2019
Cash and cash equivalents	$	559,567	$	92,258
Restricted cash	249,341		193,987
Total cash, cash equivalents, and restricted cash shown in the condensed consolidated statements of cash flows	$	808,908	$	286,245

Pursuant to the terms of the mortgage loans and Secured Term Loan (as defined in Note 6), we are required to establish, maintain, and fund from time to time (generally, either monthly or at the time borrowings are funded) certain specified reserve accounts. These reserve accounts include, but are not limited to, the following types of accounts: (i) property tax reserves; (ii) insurance reserves; (iii) capital expenditure reserves; and (iv) HOA reserves. The reserve accounts associated with our mortgage loans and Secured Term Loan are under the sole control of the loan servicer. Additionally, we hold security deposits pursuant to resident lease agreements that we are required to segregate. We are also required to hold letters of credit by certain of our insurance policies. Accordingly, amounts funded to these reserve accounts, security deposit accounts, and other restricted accounts have been classified on our condensed consolidated balance sheets as restricted cash.

The amounts funded, and to be funded, to the reserve accounts are subject to formulae included in the mortgage loan and Secured Term Loan agreements and are to be released to us subject to certain conditions specified in the loan agreements being met. To the extent that an event of default were to occur, the loan servicer has discretion to use such funds to either settle the applicable operating expenses to which such reserves relate or reduce the allocated loan amount associated with a residential property of ours.

The balances of our restricted cash accounts, as of September 30, 2020 and December 31, 2019, are set forth in the table below. As of September 30, 2020 and December 31, 2019, no amounts were funded to the insurance accounts as the conditions specified in the mortgage loan and Secured Term Loan agreements that require such funding did not exist.

	September 30, 2020		December 31, 2019
Resident security deposits	$	156,207	$	148,186
Property taxes	57,296		10,443
Collections	24,642		24,034
Capital expenditures	5,628		5,627
Letters of credit	3,319		3,459
Special and other reserves	2,249		2,238
Total	$	249,341	$	193,987

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INVITATION HOMES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

(unaudited)

Note 5—Other Assets

As of September 30, 2020 and December 31, 2019, the balances in other assets, net are as follows:

	September 30, 2020		December 31, 2019
Investments in debt securities, net	$	309,122	$	316,991
Investment in unconsolidated joint venture	53,756		54,778
Held for sale assets(1)	50,685		116,529
Rent and other receivables, net	36,540		25,244
Prepaid expenses	27,396		32,106
ROU lease assets — operating and finance, net	21,510		13,768
Investments in equity securities	16,734		16,650
Corporate fixed assets, net	8,809		9,825
Deferred leasing costs, net	7,985		7,427
Amounts deposited and held by others	5,863		1,348
Deferred financing costs, net	987		2,765
Derivative instruments (Note 7)	1		1,643
Other	12,183		6,192
Total	$	551,571	$	605,266

(1)As of September 30, 2020 and December 31, 2019, 211 and 478 properties, respectively, are classified as held for sale.

Investments in Debt Securities, net

In connection with certain of our Securitizations (as defined in Note 6), we have retained and purchased certificates totaling $309,122, net of unamortized discounts of $2,377, as of September 30, 2020. These investments in debt securities are classified as held to maturity investments. As of September 30, 2020, we have not recognized any credit losses with respect to these investments in debt securities. As of December 31, 2019, there were no gross unrecognized holding gains or losses, and there were no other than temporary impairments recognized in accumulated other comprehensive loss. As of September 30, 2020, our retained certificates are scheduled to mature over the next one month to seven years.

Investment in Unconsolidated Joint Venture

We own a 10% interest in a joint venture with FNMA to operate, lease, and manage a portfolio of properties primarily located in Arizona, California, and Nevada. A wholly owned subsidiary of INVH LP is the managing member of the joint venture and is responsible for the operation and management of the properties, subject to FNMA’s approval of major decisions. As of September 30, 2020 and December 31, 2019, the joint venture owned 581 and 641 properties, respectively.

Rent and Other Receivables

We lease our properties to residents pursuant to leases that generally have an initial contractual term of at least 12 months, provide for monthly payments, and are cancelable by the resident and us under certain conditions specified in the related lease agreements. Rental revenues and other property income and the corresponding rent and other receivables are recorded net of any concessions and bad debt (including actual write-offs, credit reserves, and uncollectible amounts) for all periods presented.

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INVITATION HOMES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

(unaudited)

Variable lease payments consist of resident reimbursements for utilities, and various other fees, including late fees and lease termination fees, among others. Variable lease payments are charged based on the terms and conditions included in the resident leases. For the three months ended September 30, 2020 and 2019, rental revenues and other property income includes $23,762 and $24,282 of variable lease payments, respectively. For the nine months ended September 30, 2020 and 2019, rental revenues and other property income includes $68,422 and $68,865 of variable lease payments, respectively.

Future minimum rental revenues and other property income under leases existing on our single-family residential properties as of September 30, 2020 are as follows:

Year	Lease Payments to be Received
Remainder of 2020	$	401,730
2021	751,863
2022	81,892
2023	—
2024	—
Thereafter	—
Total	$	1,235,485

Right-of-Use (“ROU”) Lease Assets — Operating and Finance, net

The following table presents supplemental information related to leases into which we have entered as a lessee as of September 30, 2020 and December 31, 2019:

	September 30, 2020						December 31, 2019
	Operating Leases			Finance Leases			Operating Leases			Finance Leases
Other assets	$	12,112		$	9,398		$	12,552		$	1,216
Other liabilities (Note 14)	15,190			8,979			13,787			1,210
Weighted average remaining lease term	3.9 years			3.3 years			3.8 years			2.0 years
Weighted average discount rate	3.7		%	4.0		%	4.0		%	4.0		%

During the three and nine months ended September 30, 2020, we recorded $1,750 of impairment on one of our ROU lease assets in other, net in the condensed consolidated statements of operations. See Note 11 for additional information regarding this impairment.

Investments in Equity Securities

We hold investments in equity securities without a readily determinable fair value. We have elected to measure the investments at cost, less any impairment, plus or minus changes resulting from observable price changes for identical or similar investments in the same issuers. As of September 30, 2020 and December 31, 2019, the carrying amount of our investments in equity securities was $16,734 and $16,650, respectively. No unrealized gains or losses were recorded during the three months ended September 30, 2020. For the nine months ended September 30, 2020, we recorded $34 of unrealized gains on our investments in equity securities. For the three and nine months ended September 30, 2019, we recorded $6,480 of unrealized gains on our investments in equity securities. These unrealized gains are included in other, net in the condensed consolidated statements of operations.

Deferred Financing Costs, net

In connection with our Revolving Facility, we incurred $9,673 of financing costs during the year ended December 31, 2017, which have been deferred as other assets, net on our condensed consolidated balance sheets. These deferred financing costs are being amortized as interest expense on a straight-line basis over the term of the Revolving Facility. As of

19

INVITATION HOMES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

(unaudited)

September 30, 2020 and December 31, 2019, the unamortized balances of these deferred financing costs are $987 and $2,765, respectively.

Note 6—Debt

Mortgage Loans

Our securitization transactions (the “Securitizations” or the “mortgage loans”) are collateralized by certain homes owned by the respective Borrower Entities. We utilize the proceeds from our securitizations to fund: (i) repayments of then-outstanding indebtedness; (ii) initial deposits into Securitization reserve accounts; (iii) closing costs in connection with the mortgage loans; and (iv) general costs associated with our operations.

The following table sets forth a summary of our mortgage loan indebtedness as of September 30, 2020 and December 31, 2019:

						Outstanding Principal Balance(5)
	Origination Date	Maturity Date(1)	Maturity Date if Fully Extended(2)	Interest Rate(3)	Range of Spreads(4)	September 30, 2020		December 31, 2019
IH 2017-1(6)	April 28, 2017	June 9, 2027	June 9, 2027	4.23%	N/A	$	994,699	$	995,520
SWH 2017-1(7)(8)	September 29, 2017	October 9, 2020	January 9, 2023	1.72%	102-347 bps	732,778		744,092
IH 2017-2(7)(9)	November 9, 2017	December 9, 2020	December 9, 2024	1.30%	91-186 bps	614,031		624,475
IH 2018-1(7)	February 8, 2018	March 9, 2021	March 9, 2025	1.27%	76-206 bps	775,118		793,720
IH 2018-2(7)	May 8, 2018	June 9, 2021	June 9, 2025	1.49%	95-230 bps	928,939		957,135
IH 2018-3(7)	June 28, 2018	July 9, 2021	July 9, 2025	1.50%	105-230 bps	1,138,876		1,213,035
IH 2018-4(7)(10)	November 7, 2018	January 9, 2021	January 9, 2026	1.57%	115-225 bps	924,439		938,430
Total Securitizations						6,108,880		6,266,407
Less: deferred financing costs, net						(13,900)		(27,946)
Total						$	6,094,980	$	6,238,461

(1)The maturity dates above reflect all extension options that have been exercised.

(2)Represents the maturity date if we exercise each of the remaining one year extension options available, which are subject to certain conditions being met.

(3)Except for IH 2017-1, interest rates are based on a weighted average spread over LIBOR (or a comparable or successor rate as provided for in our loan agreements), plus applicable servicing fees; as of September 30, 2020, LIBOR was 0.15%. Our IH 2017-1 mortgage loan bears interest at a fixed rate of 4.23% per annum, equal to the market determined pass-through rate payable on the certificates including applicable servicing fees.

(4)Range of spreads is based on outstanding principal balances as of September 30, 2020.

(5)Outstanding principal balance is net of discounts and does not include deferred financing costs, net.

(6)Net of unamortized discount of $2,377 and $2,641 as of September 30, 2020 and December 31, 2019, respectively.

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INVITATION HOMES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

(unaudited)

(7)The initial maturity term of each of these mortgage loans is two years, individually subject to three to five, one year extension options at the Borrower Entity’s discretion (provided that there is no continuing event of default under the mortgage loan agreement and the Borrower Entity obtains and delivers a replacement interest rate cap agreement from an approved counterparty within the required timeframe to the lender). Our SWH 2017-1, IH 2017-2, IH 2018-1, IH 2018-2 and IH 2018-3 mortgage loans have exercised the first extension option. The maturity dates above reflect all extensions that have been exercised.

(8)On October 9, 2020, the extension of the maturity date of the SWH 2017-1 mortgage loan from October 9, 2020 to October 9, 2021 was approved by the lender (see Note 15).

(9)On September 2, 2020, we submitted a notification to request an extension of the maturity of the IH 2017-2 mortgage loan from December 9, 2020 to December 9, 2021.

(10)On October 1, 2020, we submitted a notification to request an extension of the maturity date of the IH 2018-4 mortgage loan from January 9, 2021 to January 9, 2022 (see Note 15).

Securitization Transactions

For each Securitization transaction, the Borrower Entity executed a loan agreement with a third party lender. Except for IH 2017-1, each outstanding mortgage loan originally consisted of six floating rate components. The two year initial terms are individually subject to three to five, one year extension options at the Borrower Entity’s discretion. Such extensions are available provided there is no continuing event of default under the respective mortgage loan agreement and the Borrower Entity obtains and delivers a replacement interest rate cap agreement from an approved counterparty within the required timeframe to the lender. IH 2017-1 is a 10 year, fixed rate mortgage loan comprised of two components. Certificates issued by the trust in connection with Component A of IH 2017-1 benefit from FNMA’s guaranty of timely payment of principal and interest.

Each mortgage loan is secured by a pledge of the equity in the assets of the respective Borrower Entities, as well as first-priority mortgages on the underlying properties and a grant of security interests in all of the related personal property. As of September 30, 2020 and December 31, 2019, a total of 35,651 and 37,040 homes, respectively, with a net book value of $6,800,437 and $7,137,576, respectively, are pledged pursuant to the mortgage loans. Each Borrower Entity has the right, subject to certain requirements and limitations outlined in the respective loan agreements, to substitute properties. We are obligated to make monthly payments of interest for each mortgage loan.

Transactions with Trusts

Concurrent with the execution of each mortgage loan agreement, the respective third party lender sold each loan it originated to individual depositor entities (the “Depositor Entities”) who subsequently transferred each loan to Securitization-specific trust entities (the “Trusts”). The Depositor Entities for our currently outstanding Securitizations are wholly owned subsidiaries. We accounted for the transfers of the individual Securitizations from the wholly owned Depositor Entities to the respective Trusts as sales under ASC 860, Transfers and Servicing, with no resulting gain or loss as the Securitizations were both originated by the lender and immediately transferred at the same fair market value.

As consideration for the transfer of each loan to the Trusts, the Trusts issued classes of certificates which mirror the components of the individual loans (collectively, the “Certificates”) to the Depositor Entities, except that Class R certificates do not have related loan components as they represent residual interests in the Trusts. The Certificates represent the entire beneficial interest in the Trusts. Following receipt of the Certificates, the Depositor Entities sold the Certificates to investors and used the proceeds as consideration for the loans sold to the Depositor Entities by the lenders. These transactions had no effect on our condensed consolidated financial statements other than with respect to Certificates we retained in connection with Securitizations or purchased at a later date.

The Trusts are structured as pass-through entities that receive interest payments from the Securitizations and distribute those payments to the holders of the Certificates. The assets held by the Trusts are restricted and can only be used to fulfill the obligations of those entities. The obligations of the Trusts do not have any recourse to the general credit of any entities in these condensed consolidated financial statements. We have evaluated our interests in certain certificates of the Trusts held by us (discussed below) and determined that they do not create a more than insignificant variable interest in the Trusts. Additionally, the retained certificates do not provide us with any ability to direct activities that could impact the Trusts’ economic performance. Therefore, we do not consolidate the Trusts.

21

INVITATION HOMES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

(unaudited)

Retained Certificates

As the Trusts made Certificates available for sale to both domestic and foreign investors, sponsors of the mortgage loans are required to retain a portion of the risk that represents a material net economic interest in each loan pursuant to Regulation RR (the “Risk Retention Rules”) under the Securities Exchange Act of 1934, as amended. As such, loan sponsors are required to retain a portion of the credit risk that represents not less than 5% of the aggregate fair value of the loan as of the closing date.

IH 2017-1 issued Class B certificates, which are restricted certificates that were made available exclusively to INVH LP in order to comply with the Risk Retention Rules. The Class B certificates bear a stated annual interest rate of 4.23%, including applicable servicing fees.

For SWH 2017-1, IH 2017-2, IH 2018-1, IH 2018-2, IH 2018-3, and IH 2018-4, we retain 5% of each class of certificates to meet the Risk Retention Rules. These retained certificates accrue interest at a floating rate of LIBOR plus a spread ranging from 0.76% to 3.47%.

The retained certificates total $309,122 and $316,991 as of September 30, 2020 and December 31, 2019, respectively, and are classified as held to maturity investments and recorded in other assets, net on the condensed consolidated balance sheets (see Note 5).

Loan Covenants

The general terms that apply to all of the mortgage loans require each Borrower Entity to maintain compliance with certain affirmative and negative covenants. Affirmative covenants include each Borrower Entity’s, and certain of their respective affiliates’, compliance with (i) licensing, permitting and legal requirements specified in the mortgage loan agreements, (ii) organizational requirements of the jurisdictions in which they are organized, (iii) federal and state tax laws, and (iv) books and records requirements specified in the respective mortgage loan agreements. Negative covenants include each Borrower Entity’s, and certain of their affiliates’, compliance with limitations surrounding (i) the amount of each Borrower Entity’s indebtedness and the nature of their investments, (ii) the execution of transactions with affiliates, (iii) the Manager, (iv) the nature of each Borrower Entity’s business activities, and (v) the required maintenance of specified cash reserves. As of September 30, 2020, and through the date our condensed consolidated financial statements were issued, we believe each Borrower Entity is in compliance with all affirmative and negative covenants.

Prepayments

For the mortgage loans, prepayments of amounts owed by us are generally not permitted under the terms of the respective mortgage loan agreements unless such prepayments are made pursuant to the voluntary election or mandatory provisions specified in such agreements. The specified mandatory provisions become effective to the extent that a property becomes characterized as a disqualified property, a property is sold, and/or upon the occurrence of a condemnation or casualty event associated with a property. To the extent either a voluntary election is made, or a mandatory prepayment condition exists, in addition to paying all interest and principal, we must also pay certain breakage costs as determined by the loan servicer and a spread maintenance premium if prepayment occurs before the month following the one or two year anniversary of the closing dates of each of the mortgage loans except for IH 2017-1. For IH 2017-1, prepayments on or before December 2026 will require a yield maintenance premium. For the nine months ended September 30, 2020 and 2019, we made voluntary and mandatory prepayments of $157,791 and $798,415, respectively, under the terms of the mortgage loan agreements. During the nine months ended September 30, 2019, prepayments included the full repayment of the CSH 2016-2 mortgage loan.

22

INVITATION HOMES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

(unaudited)

Secured Term Loan

On June 7, 2019, 2019-1 IH Borrower LP, a consolidated subsidiary (“2019-1 IH Borrower” and one of our Borrower Entities), entered into a 12 year loan agreement with a life insurance company (the “Secured Term Loan”). The Secured Term Loan bears interest at a fixed rate of 3.59%, including applicable servicing fees, for the first 11 years and bears interest at a floating rate based on a spread of 147 bps, including applicable servicing fees, over one month LIBOR (subject to certain adjustments as outlined in the loan agreement) for the twelfth year. The Secured Term Loan is secured by first priority mortgages on a portfolio of single-family rental properties as well as a first priority pledge of the equity interests of 2019-1 IH Borrower. We utilized the proceeds from the Secured Term Loan to fund: (i) repayments of then-outstanding indebtedness; (ii) initial deposits into the Secured Term Loan’s reserve accounts; (iii) transaction costs related to the closing of the Secured Term Loan; and (iv) general corporate purposes.

The following table sets forth a summary of our Secured Term Loan indebtedness as of September 30, 2020 and December 31, 2019:

	Maturity Date	Interest Rate(1)	September 30, 2020		December 31, 2019
Secured Term Loan	June 9, 2031	3.59%	$	403,363	$	403,464
Deferred financing costs, net			(2,323)		(2,486)
Secured Term Loan, net			$	401,040	$	400,978

(1)The Secured Term Loan bears interest at a fixed rate of 3.59% per annum including applicable servicing fees for the first 11 years and for the twelfth year bears interest at a floating rate based on a spread of 147 bps over one month LIBOR (or a comparable or successor rate as provided for in our loan agreement), including applicable servicing fees, subject to certain adjustments as outlined in the loan agreement. Interest payments are made monthly.

Collateral

The Secured Term Loan’s collateral pool contains 3,332 and 3,333 homes, respectively, as of September 30, 2020 and December 31, 2019, with a net book value of $724,041 and $734,759, respectively. 2019-1 IH Borrower has the right, subject to certain requirements and limitations outlined in the loan agreement, to substitute properties representing up to 20% of the collateral pool annually, and to substitute properties representing up to 100% of the collateral pool over the life of the Secured Term Loan. In addition, four times after the first anniversary of the closing date, 2019-1 IH Borrower has the right, subject to certain requirements and limitations outlined in the loan agreement, to execute a special release of collateral representing up to 15% of the then-outstanding principal balance of the Secured Term Loan in order to bring the loan-to-value ratio back in line with the Secured Term Loan’s loan-to-value ratio as of the closing date. Any such special release of collateral would not change the then-outstanding principal balance of the Secured Term Loan, but rather would reduce the number of single-family rental homes included in the collateral pool.

Loan Covenants

The Secured Term Loan requires 2019-1 IH Borrower to maintain compliance with certain affirmative and negative covenants. Affirmative covenants include 2019-1 IH Borrower’s, and certain of its affiliates’, compliance with (i) licensing, permitting and legal requirements specified in the loan agreement, (ii) organizational requirements of the jurisdictions in which they are organized, (iii) federal and state tax laws, and (iv) books and records requirements specified in the loan agreement. Negative covenants include 2019-1 IH Borrower’s, and certain of its affiliates’, compliance with limitations surrounding (i) the amount of 2019-1 IH Borrower’s indebtedness and the nature of its investments, (ii) the execution of transactions with affiliates, (iii) the Manager, (iv) the nature of 2019-1 IH Borrower’s business activities, and (v) the required maintenance of specified cash reserves. As of September 30, 2020, and through the date our condensed consolidated financial statements were issued, we believe 2019-1 IH Borrower is in compliance with all affirmative and negative covenants.

23

INVITATION HOMES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

(unaudited)

Prepayments

Prepayments of the Secured Term Loan are generally not permitted unless such prepayments are made pursuant to the voluntary election or mandatory provisions specified in the loan agreement. The specified mandatory provisions become effective to the extent that a property becomes characterized as a disqualified property, a property is sold, and/or upon the occurrence of a condemnation or casualty event associated with a property. To the extent either a voluntary election is made, or a mandatory prepayment condition exists, in addition to paying all interest and principal, we must also pay certain breakage costs as determined by the loan servicer and a yield maintenance premium if prepayment occurs before June 9, 2030. For the nine months ended September 30, 2020, we made mandatory prepayments of $101. No prepayments were made for the nine months ended September 30, 2019.

Term Loan Facility and Revolving Facility

On February 6, 2017, we entered into a credit agreement with a syndicate of banks, financial institutions, and institutional lenders for a credit facility (the “Credit Facility”), which was amended on December 18, 2017 to include all entities and homes acquired in the Mergers. The Credit Facility provides $2,500,000 of borrowing capacity and consists of a $1,000,000 revolving facility (the “Revolving Facility”), which will mature on February 6, 2021, with a one year extension option, and a $1,500,000 term loan facility (the “Term Loan Facility”), which will mature on February 6, 2022. The Revolving Facility also includes borrowing capacity available for letters of credit and for short-term borrowings referred to as swing line borrowings, in each case subject to certain sublimits. The Credit Facility provides us with the option to enter into additional incremental credit facilities (including an uncommitted incremental facility that provides us with the option to increase the size of the Revolving Facility and/or the Term Loan Facility by an aggregate amount of up to $1,500,000), subject to certain limitations. Proceeds from the Term Loan Facility were used to repay then-outstanding indebtedness and for general corporate purposes. Proceeds from the Revolving Facility are used for general corporate purposes.

The following table sets forth a summary of the outstanding principal amounts under the Credit Facility as of September 30, 2020 and December 31, 2019:

	Maturity Date	Interest Rate(1)	September 30, 2020		December 31, 2019
Term Loan Facility	February 6, 2022	1.85%	$	1,500,000	$	1,500,000
Deferred financing costs, net			(4,087)		(6,253)
Term Loan Facility, net			$	1,495,913	$	1,493,747
Revolving Facility(2)	February 6, 2021	1.90%	$	—	$	—

(1)Interest rates for the Term Loan Facility and the Revolving Facility are based on LIBOR plus an applicable margin. As of September 30, 2020, the applicable margins were 1.70% and 1.75%, respectively, and LIBOR was 0.15%.

(2)If we exercise the one year extension option, the maturity date will be February 6, 2022.

Interest Rate and Fees

Borrowings under the Credit Facility bear interest, at our option, at a rate equal to a margin over either (a) a LIBOR rate determined by reference to the Bloomberg LIBOR rate (or a comparable or successor rate as provided for in our loan agreement) for the interest period relevant to such borrowing, or (b) a base rate determined by reference to the highest of (1) the administrative agent’s prime lending rate, (2) the federal funds effective rate plus 0.50%, and (3) the LIBOR rate that would be payable on such day for a LIBOR rate loan with a one month interest period plus 1.00%. The margin is based on a total leverage based grid. The margin for the Revolving Facility ranges from 0.75% to 1.30% in the case of base rate loans, and 1.75% to 2.30% in the case of LIBOR rate loans. The margin for the Term Loan Facility ranges from 0.70% to 1.30% in the case of base rate loans, and 1.70% to 2.30% in the case of LIBOR rate loans. In addition, the Credit Facility provides that, upon receiving an investment grade rating on its non-credit enhanced, senior unsecured long term debt of BBB- or better from Standard & Poor’s Rating Services, a division of The McGraw-Hill Companies, Inc., or Baa3 or better from Moody’s Investors Service, Inc. (an “Investment Grade Rating Event”), we may elect to convert to a credit rating based pricing grid.

24

INVITATION HOMES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

(unaudited)

In addition to paying interest on outstanding principal under the Credit Facility, we are required to pay a facility fee to the lenders under the Revolving Facility in respect of the unused commitments thereunder. The facility fee rate is based on the daily unused amount of the Revolving Facility and is either 0.35% or 0.20% per annum based on the unused facility amount. Upon converting to a credit rating pricing based grid, the unused facility fee will no longer apply and we will be required to pay a facility fee ranging from 0.125% to 0.300%. We are also required to pay customary letter of credit fees.

Prepayments and Amortization

No principal reductions are required under the Credit Facility. We are permitted to voluntarily repay amounts outstanding under the Term Loan Facility at any time without premium or penalty, subject to certain minimum amounts and the payment of customary “breakage” costs with respect to LIBOR loans. Once repaid, no further borrowings will be permitted under the Term Loan Facility.

Loan Covenants

The Credit Facility contains certain customary affirmative and negative covenants and events of default. Such covenants will, among other things, restrict, subject to certain exceptions, our ability and that of the Subsidiary Guarantors (as defined below) and their respective subsidiaries to (i) engage in certain mergers, consolidations or liquidations, (ii) sell, lease or transfer all or substantially all of their respective assets, (iii) engage in certain transactions with affiliates, (iv) make changes to our fiscal year, (v) make changes in the nature of our business and our subsidiaries, and (vi) incur additional indebtedness that is secured on a pari passu basis with the Credit Facility.

The Credit Facility also requires us, on a consolidated basis with our subsidiaries, to maintain a (i) maximum total leverage ratio, (ii) maximum secured leverage ratio, (iii) maximum unencumbered leverage ratio, (iv) minimum fixed charge coverage ratio, (v) minimum unencumbered fixed charge coverage ratio, and (vi) minimum tangible net worth. If an event of default occurs, the lenders under the Credit Facility are entitled to take various actions, including the acceleration of amounts due under the Credit Facility and all actions permitted to be taken by a secured creditor. As of September 30, 2020, and through the date our condensed consolidated financial statements were issued, we believe we were in compliance with all affirmative and negative covenants.

Guarantees and Security

The obligations under the Credit Facility are guaranteed on a joint and several basis by each of our direct and indirect domestic wholly owned subsidiaries that own, directly or indirectly, unencumbered assets (the “Subsidiary Guarantors”), subject to certain exceptions. The guarantee provided by any Subsidiary Guarantor will be automatically released upon the occurrence of certain events, including if it no longer has a direct or indirect interest in an unencumbered asset or as a result of certain non-recourse refinancing transactions pursuant to which such Subsidiary Guarantor becomes contractually prohibited from providing its guaranty of the Credit Facility. In addition, INVH may be required to provide a guarantee of the Credit Facility under certain circumstances, including if INVH does not maintain its qualification as a REIT.

The Credit Facility is collateralized by first priority or equivalent security interests in all the capital stock of, or other equity interests in, any Subsidiary Guarantor held by us and each of the Subsidiary Guarantors. The security interests granted under the Credit Facility will be automatically released upon the occurrence of certain events, including upon an Investment Grade Rating Event or if the total net leverage ratio is less than or equal to 8.00:1.00 for four consecutive fiscal quarters.

Convertible Senior Notes

In connection with the Mergers, we assumed SWH’s convertible senior notes. In July 2014, SWH issued $230,000 in aggregate principal amount of 3.00% convertible senior notes due 2019 (the “2019 Convertible Notes”). Interest on the 2019 Convertible Notes was payable semiannually in arrears on January 1st and July 1st of each year. The notes matured on July 1, 2019, and we settled substantially all of the outstanding balance of the 2019 Convertible Notes through the issuance of 12,553,864 shares of our common stock.

25

INVITATION HOMES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

(unaudited)

In January 2017, SWH issued $345,000 in aggregate principal amount of 3.50% convertible senior notes due 2022 (the “2022 Convertible Notes” and together with the 2019 Convertible Notes, the “Convertible Senior Notes”). Interest on the 2022 Convertible Notes is payable semiannually in arrears on January 15th and July 15th of each year. The 2022 Convertible Notes will mature on January 15, 2022.

The following table summarizes the terms of the Convertible Senior Notes outstanding as of September 30, 2020 and December 31, 2019:

						Principal Amount
	Coupon Rate	Effective Rate(1)	Conversion Rate(2)	Maturity Date	Remaining Amortization Period	September 30, 2020		December 31, 2019
2022 Convertible Notes	3.50%	5.12%	43.7694	January 15, 2022	1.29 years	$	345,000	$	345,000
Net unamortized fair value adjustment						(6,888)		(10,701)
Total						$	338,112	$	334,299

(1)Effective rate includes the effect of the adjustment to the fair value of the debt as of the Merger Date, the value of which reduced the initial liability recorded to $324,252 for the 2022 Convertible Notes.

(2)The conversion rate as of September 30, 2020 represents the number of shares of common stock issuable per $1,000 principal amount (actual $) of the 2022 Convertible Notes converted on such date, as adjusted in accordance with the indenture as a result of cash dividend payments and the effects of previous mergers. As of September 30, 2020, the 2022 Convertible Notes do not meet the criteria for conversion. We have the option to settle the 2022 Convertible Notes in cash, common stock, or a combination thereof.

Terms of Conversion

On July 1, 2019, we settled substantially all of the outstanding balance of the 2019 Convertible Notes with the issuance of 12,553,864 shares of our common stock. At the settlement date, the conversion rate applicable to the 2019 Convertible Notes was 54.5954 shares of our common stock per $1,000 principal amount (actual $) of the 2019 Convertible Notes (equivalent to a conversion price of approximately $18.32 per common share — actual $). For the nine months ended September 30, 2019, interest expense for the 2019 Convertible Notes, including non-cash amortization of discounts, was $5,586.

As of September 30, 2020, the conversion rate applicable to the 2022 Convertible Notes is 43.7694 shares of our common stock per $1,000 principal amount (actual $) of the 2022 Convertible Notes (equivalent to a conversion price of approximately $22.85 per common share — actual $). The conversion rate for the 2022 Convertible Notes is subject to adjustment in some events, but will not be adjusted for any accrued and unpaid interest. In addition, following certain events that occur prior to the maturity date, we will adjust the conversion rate for a holder who elects to convert its 2022 Convertible Notes in connection with such an event in certain circumstances. At any time prior to July 15, 2021, holders may convert the 2022 Convertible Notes at their option only under specific circumstances as defined in the indenture agreement, dated as of January 10, 2017, between us and our trustee, Wilmington Trust National Association (the “Convertible Notes Trustee”). On or after July 15, 2021 and until maturity, holders may convert all or any portion of the 2022 Convertible Notes at any time. Upon conversion, we will pay or deliver, as the case may be, cash, common stock, or a combination of cash and common stock, at our election. The “if-converted” value of the 2022 Convertible Notes exceeds the principal amount by $77,661 as of September 30, 2020 as the closing market price of our common stock of $27.99 per common share (actual $) exceeds the implicit conversion price. For the three months ended September 30, 2020 and 2019, interest expense for the 2022 Convertible Notes, including non-cash amortization of discounts, was $4,311 and $4,247, respectively. For the nine months ended September 30, 2020 and 2019, interest expense for the 2022 Convertible Notes, including non-cash amortization of discounts, was $12,869 and $12,681, respectively.

26

INVITATION HOMES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

(unaudited)

General Terms

We may not redeem the 2022 Convertible Notes prior to their maturity date except to the extent necessary to preserve our status as a REIT for United States federal income tax purposes, as further described in the indenture. If we undergo a fundamental change as defined in the indenture, holders may require us to repurchase for cash all or any portion of their 2022 Convertible Notes at a fundamental change repurchase price equal to 100% of the principal amount of the 2022 Convertible Notes to be repurchased, plus accrued and unpaid interest up to, but excluding, the fundamental change repurchase date.

The indenture contains customary terms and covenants and events of default. If an event of default occurs and is continuing, the Convertible Notes Trustee, by notice to us, or the holders of at least 25% in aggregate principal amount of the outstanding 2022 Convertible Notes, by notice to us and the Convertible Notes Trustee, may, and the Convertible Notes Trustee at the request of such holders shall, declare 100% of the principal of and accrued and unpaid interest on all the 2022 Convertible Notes to be due and payable. In the case of an event of default arising out of certain events of bankruptcy, insolvency or reorganization in respect to us (as set forth in the indenture), 100% of the principal of and accrued and unpaid interest on the 2022 Convertible Notes will automatically become due and payable.

Debt Maturities Schedule

The following table summarizes the contractual maturities of our debt as of September 30, 2020:

Year	Mortgage Loans(1)(2)		Secured Term Loan		Term Loan Facility		Revolving Facility(3)		Convertible Senior Notes		Total
Remainder of 2020	$	1,346,809	$	—	$	—	$	—	$	—	$	1,346,809
2021	3,767,372		—		—		—		—		3,767,372
2022	—		—		1,500,000		—		345,000		1,845,000
2023	—		—		—		—		—		—
2024	—		—		—		—		—		—
Thereafter	994,699		403,363		—		—		—		1,398,062
Total	6,108,880		403,363		1,500,000		—		345,000		8,357,243
Less: deferred financing costs, net	(13,900)		(2,323)		(4,087)		—		—		(20,310)
Less: unamortized fair value adjustment	—		—		—		—		(6,888)		(6,888)
Total	$	6,094,980	$	401,040	$	1,495,913	$	—	$	338,112	$	8,330,045

(1)The maturity dates of the obligations are reflective of all extensions that have been exercised as of September 30, 2020. If fully extended, we would have no mortgage loans maturing before 2023. Such extensions are available provided there is no continuing event of default under the respective mortgage loan agreement and the Borrower Entity obtains and delivers a replacement interest rate cap agreement from an approved counterparty within the required timeframe to the lender.

(2)On September 2, 2020, we submitted a notification to request an extension of the maturity of the IH 2017-2 mortgage loan from December 9, 2020 to December 9, 2021. Additionally, on October 9, 2020, the extension of the maturity date of the SWH 2017-1 mortgage loan from October 9, 2020 to October 9, 2021 was approved by the lender, and on October 1, 2020, we submitted a notification to request an extension of the maturity date of the IH 2018-4 mortgage loan from January 9, 2021 to January 9, 2022 (see Note 15).

(3)If we exercise the one year extension option, the maturity date will be in 2022.

Note 7—Derivative Instruments

From time to time, we enter into derivative instruments to manage the economic risk of changes in interest rates. We do not enter into derivative transactions for speculative or trading purposes. Designated hedges are derivatives that meet the criteria for hedge accounting and that we have elected to designate as hedges. Non-designated hedges are derivatives that do not meet the criteria for hedge accounting or that we did not elect to designate as hedges.

27

INVITATION HOMES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

(unaudited)

Designated Hedges

We have entered into various interest rate swap agreements, which are used to hedge the variable cash flows associated with variable-rate interest payments. Currently, each of our swap agreements is indexed to LIBOR and is designated for hedge accounting purposes. LIBOR is set to expire at the end of 2021, and we will work with the counterparties to our swap agreements to adjust each floating rate to a comparable or successor rate. Changes in the fair value of these swaps are recorded in other comprehensive income and are subsequently reclassified into earnings in the period in which the hedged forecasted transactions affect earnings.

The table below summarizes our interest rate swap instruments as of September 30, 2020:

Agreement Date	Forward Effective Date	Maturity Date	Strike Rate	Index	Notional Amount
December 21, 2016	February 28, 2017	January 31, 2022	1.97%	One month LIBOR	$	750,000
December 11, 2019	February 28, 2017	December 31, 2024	1.74%	One month LIBOR	750,000
April 19, 2018	January 31, 2019	January 31, 2025	2.86%	One month LIBOR	400,000
February 15, 2019	March 15, 2019	March 15, 2022	2.23%	One month LIBOR	800,000
April 19, 2018	March 15, 2019	November 30, 2024	2.85%	One month LIBOR	400,000
April 19, 2018	March 15, 2019	February 28, 2025	2.86%	One month LIBOR	400,000
January 10, 2017	January 15, 2020	January 15, 2021	2.13%	One month LIBOR	550,000
May 8, 2018	March 9, 2020	June 9, 2025	2.99%	One month LIBOR	325,000
May 8, 2018	June 9, 2020	June 9, 2025	2.99%	One month LIBOR	595,000
June 3, 2016	July 15, 2020	July 15, 2021	1.47%	One month LIBOR	450,000
June 28, 2018	August 7, 2020	July 9, 2025	2.90%	One month LIBOR	1,100,000
January 10, 2017	January 15, 2021	July 15, 2021	2.23%	One month LIBOR	550,000
December 9, 2019	July 15, 2021	November 30, 2024	2.90%	One month LIBOR	400,000
November 7, 2018	March 15, 2022	July 31, 2025	3.14%	One month LIBOR	400,000
November 7, 2018	March 15, 2022	July 31, 2025	3.16%	One month LIBOR	400,000

During the three and nine months ended September 30, 2020 and 2019, such derivatives were used to hedge the variable cash flows associated with existing variable-rate interest payments. Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are made on our variable-rate debt. During the next 12 months, we estimate that $152,334 will be reclassified to earnings as an increase in interest expense.

Non-Designated Hedges

Concurrent with entering into certain of the mortgage loan agreements and in connection with previous mergers, we entered into or acquired and maintain interest rate cap agreements with terms and notional amounts equivalent to the terms and amounts of the mortgage loans made by the third party lenders. Currently, each of our cap agreements is indexed to LIBOR, which is set to expire at the end of 2021. We will work with the counterparties to our cap agreements to adjust each floating rate to a comparable or successor rate. To the extent that the maturity date of one or more of the mortgage loans is extended through an exercise of one or more extension options, replacement or extension interest rate cap agreements must be executed with terms similar to those associated with the initial interest rate cap agreements and strike prices equal to the greater of the interest rate cap strike price and the interest rate at which the debt service coverage ratio (as defined) is not less than 1.2 to 1.0. The interest rate cap agreements, including all of our rights to payments owed by the counterparties and all other rights, have been pledged as additional collateral for the mortgage loans. Additionally, in certain instances, in order to minimize the cash impact of purchasing required interest rate caps, we simultaneously sell interest rate caps (which have identical terms and notional amounts) such that the purchase price and sales proceeds of the related interest rate caps are intended to offset each other. The purchased and sold interest rate caps have strike prices ranging from approximately 3.75% to 5.31%.

28

INVITATION HOMES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

(unaudited)

Fair Values of Derivative Instruments on the Condensed Consolidated Balance Sheets

The table below presents the fair value of our derivative financial instruments as well as their classification on the condensed consolidated balance sheets as of September 30, 2020 and December 31, 2019:

	Asset Derivatives					Liability Derivatives
		Fair Value as of					Fair Value as of
	Balance Sheet Location	September 30, 2020		December 31, 2019		Balance Sheet Location	September 30, 2020		December 31, 2019
Derivatives designated as hedging instruments:
Interest rate swaps	Other assets	$	—	$	1,643	Other liabilities	$	602,507	$	275,679
Derivatives not designated as hedging instruments:
Interest rate caps	Other assets	1		—		Other liabilities	—		—
Total		$	1	$	1,643		$	602,507	$	275,679

Offsetting Derivatives

We enter into master netting arrangements, which reduce risk by permitting net settlement of transactions with the same counterparty. The tables below present a gross presentation, the effects of offsetting, and a net presentation of our derivatives as of September 30, 2020 and December 31, 2019:

	September 30, 2020
							Gross Amounts Not Offset in the Statement of Financial Position
	Gross Amounts of Recognized Assets/ Liabilities		Gross Amounts Offset in the Statement of Financial Position		Net Amounts of Assets/ Liabilities Presented in the Statement of Financial Position		Financial Instruments		Cash Collateral Received		Net Amount
Offsetting assets:
Derivatives	$	1	$	—	$	1	$	—	$	—	$	1
Offsetting liabilities:
Derivatives	$	602,507	$	—	$	602,507	$	—	$	—	$	602,507

	December 31, 2019
							Gross Amounts Not Offset in the Statement of Financial Position
	Gross Amounts of Recognized Assets/ Liabilities		Gross Amounts Offset in the Statement of Financial Position		Net Amounts of Assets/ Liabilities Presented in the Statement of Financial Position		Financial Instruments		Cash Collateral Received		Net Amount
Offsetting assets:
Derivatives	$	1,643	$	—	$	1,643	$	(1,054)	$	—	$	589
Offsetting liabilities:
Derivatives	$	275,679	$	—	$	275,679	$	(1,054)	$	—	$	274,625

29

INVITATION HOMES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

(unaudited)

Effect of Derivative Instruments on the Condensed Consolidated Statements of Comprehensive Income (Loss) and the Condensed Consolidated Statements of Operations

The tables below present the effect of our derivative financial instruments in the condensed consolidated statements of comprehensive income (loss) and the condensed consolidated statements of operations for the three months ended September 30, 2020 and 2019:

	Amount of Loss Recognized in OCI on Derivative				Location of Gain (Loss) Reclassified from Accumulated OCI into Net Income	Amount of Gain (Loss) Reclassified from Accumulated OCI into Net Income				Total Amount of Interest Expense Presented in the Condensed Consolidated Statements of Operations
	For the Three Months Ended September 30,					For the Three Months Ended September 30,				For the Three Months Ended September 30,
	2020		2019			2020		2019		2020		2019
Derivatives in cash flow hedging relationships:
Interest rate swaps	$	(4,171)	$	(71,729)	Interest expense	$	(37,557)	$	4,272	$	87,713	$	89,067

	Location of Loss Recognized in Net Income on Derivative	Amount of Loss Recognized in Net Income on Derivative
		For the Three Months Ended September 30,
		2020		2019
Derivatives not designated as hedging instruments:
Interest rate caps	Interest expense	$	146	$	64

The tables below present the effect of our derivative financial instruments in the condensed consolidated statements of comprehensive income (loss) and the condensed consolidated statements of operations for the nine months ended September 30, 2020 and 2019:

	Amount of Loss Recognized in OCI on Derivative				Location of Gain (Loss) Reclassified from Accumulated OCI into Net Income	Amount of Gain (Loss) Reclassified from Accumulated OCI into Net Income				Total Amount of Interest Expense Presented in the Condensed Consolidated Statements of Operations
	For the Nine Months Ended September 30,					For the Nine Months Ended September 30,				For the Nine Months Ended September 30,
	2020		2019			2020		2019		2020		2019
Derivatives in cash flow hedging relationships:
Interest rate swaps	$	(398,426)	$	(308,196)	Interest expense	$	(74,166)	$	23,026	$	258,541	$	278,756

	Location of Loss Recognized in Net Income on Derivative	Amount of Loss Recognized in Net Income on Derivative
		For the Nine Months Ended September 30,
		2020		2019
Derivatives not designated as hedging instruments:
Interest rate caps	Interest expense	$	198	$	98

30

INVITATION HOMES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

(unaudited)

Credit-Risk-Related Contingent Features

The agreements with our derivative counterparties which govern our interest rate swap agreements contain a provision where we could be declared in default on our derivative obligations if repayment of the underlying indebtedness is accelerated by the lender due to our default on the indebtedness.

As of September 30, 2020, the fair value of certain derivatives in a net liability position was $602,507. If we had breached any of these provisions at September 30, 2020, we could have been required to settle the obligations under the agreements at their termination value, which includes accrued interest and excludes the nonperformance risk related to these agreements, of $631,397.

Note 8—Stockholders' Equity

As of September 30, 2020, we have issued 560,534,032 shares of common stock. In addition, we issue OP Units from time to time which, upon vesting, are redeemable for shares of our common stock on a one-for-one basis or, in our sole discretion, cash and are reflected as non-controlling interests on our condensed consolidated balance sheets and statements of equity. As of September 30, 2020, 3,463,285 outstanding OP Units are redeemable.

During the three and nine months ended September 30, 2020, we issued 1,353 and 18,891,307, respectively, shares of common stock.

Public Offering

On June 4, 2020, we completed an underwritten public offering of 16,675,000 shares of our common stock, including 2,175,000 shares sold pursuant to the underwriters’ full exercise of the option to purchase additional shares. During the nine months ended September 30, 2020, this offering generated net proceeds of $447,533, after giving effect to commissions and other costs totaling $6,861.

At the Market Equity Program

On August 22, 2019, we entered into distribution agreements with a syndicate of banks (the “Agents”), pursuant to which we may sell, from time to time, up to an aggregate sales price of $800,000 of our common stock through the Agents (the “ATM Equity Program”). During the nine months ended September 30, 2020, we sold 1,887,466 shares of our common stock under our ATM Equity Program, generating net proceeds of $56,265 after giving effect to Agent commissions and other costs totaling $977. During the three and nine months ended September 30, 2019, we sold 671,020 shares of our common stock under our ATM Equity Program, generating net proceeds of $17,737 after giving effect to Agent commissions and other costs totaling $1,068. We did not sell any shares of common stock under the ATM Equity Program during the three months ended September 30, 2020. As of September 30, 2020, $685,799 remains available for future offerings under the ATM Equity Program.

Dividends

To qualify as a REIT, we are required to distribute annually to our stockholders at least 90% of our REIT taxable income, without regard to the deduction for dividends paid and excluding net capital gains, and to pay tax at regular corporate rates to the extent that we annually distribute less than 100% of our net taxable income. We intend to pay quarterly dividends to our stockholders, which in the aggregate are approximately equal to or exceed our net taxable income in the relevant year. The timing, form, and amount of distributions, if any, to our stockholders, will be at the sole discretion of our board of directors.

31

INVITATION HOMES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

(unaudited)

The following table summarizes our dividends declared from January 1, 2019 through September 30, 2020:

	Record Date	Amount per Share		Pay Date	Total Amount Declared
Q3-2020	August 12, 2020	$	0.15	August 28, 2020	$	84,286
Q2-2020	May 13, 2020	0.15		May 29, 2020	81,916
Q1-2020	February 12, 2020	0.15		February 28, 2020	81,673
Q4-2019	November 13, 2019	0.13		November 27, 2019	70,693
Q3-2019	August 15, 2019	0.13		August 30, 2019	70,465
Q2-2019	May 15, 2019	0.13		May 31, 2019	68,334
Q1-2019	February 13, 2019	0.13		February 28, 2019	67,965

On October 22, 2020, our board of directors declared a dividend of $0.15 per share to stockholders of record on November 10, 2020, which is payable on November 25, 2020.

Note 9—Related Party Transactions

Management Services

One of our consolidated subsidiaries, as the managing member of a joint venture with FNMA (see Note 5), earns a management fee based upon the venture’s gross receipts. For the three months ended September 30, 2020 and 2019, we earned $636 and $696, respectively, and for the nine months ended September 30, 2020 and 2019, we earned $1,945 and $2,145, respectively, of management fees which are included in other, net in the accompanying condensed consolidated statements of operations.

Note 10—Share-Based Compensation

Prior to completion of the IPO, our board of directors adopted, and our stockholders approved, the Invitation Homes Inc. 2017 Omnibus Incentive Plan (the “Omnibus Incentive Plan”) to provide a means through which to attract and retain key personnel and to provide a means whereby our directors, officers, employees, consultants, and advisors can acquire and maintain an equity interest in us, or be paid incentive compensation, including incentive compensation measured by reference to the value of our common stock, and to align their interests with those of our stockholders. Under the Omnibus Incentive Plan, we may issue up to 16,000,000 shares of common stock.

Our share-based awards consist of time-vesting restricted stock units (“RSUs”), performance and market based vesting RSUs (“PRSUs”), and Outperformance Awards (defined below). Time-vesting RSUs are participating securities for EPS purposes, and PRSUs and Outperformance Awards are not. For detailed discussion of RSUs and PRSUs issued prior to January 1, 2020, refer to our Annual Report on Form 10-K for the year ended December 31, 2019.

Share-Based Awards

The following summarizes our share-based award activity during the nine months ended September 30, 2020.

Annual Long Term Incentive Plan (“LTIP”):

•Annual LTIP Awards Granted: During the nine months ended September 30, 2020, we granted 499,228 RSUs pursuant to LTIP awards (together with previously granted annual LTIP awards, “LTIP Awards”). Each award includes components which vest based on time-vesting conditions, market based vesting conditions, and performance based vesting conditions, each of which is subject to continued employment through the applicable vesting date. The time-vesting RSUs granted during the nine months ended September 30, 2020 vest in three equal annual installments based on an anniversary date of March 1, 2020. The PRSUs granted during the nine months ended September 30, 2020 may be earned based on the achievement of certain measures over a three year performance period that ends December 31, 2022. The number of PRSUs earned will be determined based on performance achieved during the performance period for each measure at certain threshold, target, or maximum levels and corresponding payout ranges. In general, the LTIP PRSUs are earned after the end of the performance

32

INVITATION HOMES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

(unaudited)

period on the date on which the performance results are certified by our compensation and management development committee (the “Compensation Committee”).

All of the LTIP Awards are subject to certain change in control and retirement eligibility provisions that may impact these vesting schedules.

•PRSU Results: In February 2020, the Compensation Committee certified performance achievement with respect to Tranche 3 of our 2017 LTIP Awards. Certain PRSUs vested and achieved performance in excess of the target level, resulting in the issuance of an additional 91,200 shares of common stock. Such awards are reflected as an increase in the number of awards granted and vested in the table below. Certain other PRSUs did not achieve performance criteria, resulting in the cancellation of 5,348 awards. Such awards are reflected as an increase in the number of awards forfeited/canceled in the table below.

Director Awards

During the nine months ended September 30, 2020, we granted 58,690 time-vesting RSUs to members of our board of directors, which awards will fully vest on the date of INVH’s 2021 annual stockholders meeting, subject to continued service on the board of directors through such date.

Outperformance Awards

On May 1, 2019, the Compensation Committee approved one-time equity based awards with market based vesting conditions in the form of PRSUs and OP Units (the “Outperformance Awards”). The Outperformance Awards may be earned based on the achievement of rigorous absolute total shareholder return and relative total shareholder return thresholds over a three year performance period ending on March 31, 2022. Upon completion of the performance period, the dollar value of the awards earned under the absolute and relative total shareholder return components will be separately calculated, and the number of earned Outperformance Awards will be determined based on the earned dollar value of the awards and the stock price at the performance certification date. Earned awards will vest 50% on March 31, 2022 and 25% on each of the first and second anniversaries of such date, subject to continued employment. The current aggregate $12,390 grant-date fair value of the Outperformance Awards still outstanding was determined based on Monte-Carlo option pricing models which estimate the probability of the vesting conditions being satisfied.

Summary of Total Share-Based Awards

The following table summarizes activity related to non-vested time-vesting RSUs and PRSUs, other than Outperformance Awards, during the nine months ended September 30, 2020:

	Time-Vesting Awards			PRSUs			Total Share-Based Awards(1)
	Number	Weighted Average Grant Date Fair Value (Actual $)		Number	Weighted Average Grant Date Fair Value (Actual $)		Number	Weighted Average Grant Date Fair Value (Actual $)
Balance, December 31, 2019	685,069	$	22.48	925,076	$	23.13	1,610,145	$	22.86
Granted	225,760	28.25		423,358	29.73		649,118	29.21
Vested(2)	(293,481)	(22.97)		(152,967)	(22.25)		(446,448)	(22.72)
Forfeited / canceled	(9,810)	(25.54)		(22,060)	(23.48)		(31,870)	(24.11)
Balance, September 30, 2020	607,538	$	24.34	1,173,407	$	25.62	1,780,945	$	25.18

(1)Total share-based awards excludes Outperformance Awards.

(2)All vested share-based awards are included in basic EPS for the periods after each award’s vesting date. The estimated fair value of share-based awards that fully vested during the nine months ended September 30, 2020 was $9,867. During the nine months ended September 30, 2020, 1,787 RSUs were accelerated pursuant to the terms and conditions of the Omnibus Incentive Plan and related award agreements.

33

INVITATION HOMES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

(unaudited)

Grant-Date Fair Values

The grant-date fair values of the time-vesting RSUs and PRSUs with performance condition vesting criteria are generally based on the closing price of our common stock on the grant date. However, the grant-date fair values for share-based awards with market condition vesting criteria are based on Monte-Carlo option pricing models. The following table summarizes the significant inputs utilized in these models for such awards granted during the nine months ended September 30, 2020:

	For the Nine Months Ended September 30,
Expected volatility(1)	17.2	%	—	17.3%
Risk-free rate	0.85%
Expected holding period (years)	2.09		—	2.84

(1)Expected volatility was estimated based on the historical volatility of INVH’s realized returns and the applicable index.

Summary of Total Share-Based Compensation Expense

During the three and nine months ended September 30, 2020 and 2019, we recognized share-based compensation expense as follows:

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2020		2019		2020		2019
General and administrative	$	4,833	$	3,818	$	9,760	$	11,533
Property management expense	1,253		807		2,533		2,314
Total	$	6,086	$	4,625	$	12,293	$	13,847

As of September 30, 2020, there is $23,401 of unrecognized share-based compensation expense related to non-vested share-based awards which is expected to be recognized over a weighted average period of 1.90 years.

Note 11—Fair Value Measurements

The carrying amounts of restricted cash, certain components of other assets, accounts payable and accrued expenses, resident security deposits, and certain components of other liabilities approximate fair value due to the short maturity of these amounts. Our interest rate swap agreements and interest rate cap agreements are the only financial instruments recorded at fair value on a recurring basis within our condensed consolidated financial statements. The fair values of our interest rate caps and swaps, which are classified as Level 2 in the fair value hierarchy, are estimated using market values of instruments with similar attributes and maturities. See Note 7 for the details of the condensed consolidated balance sheet classification and the fair values for the interest rate caps and swaps.

34

INVITATION HOMES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

(unaudited)

Recurring Fair Value Measurements

The following table displays the carrying values and fair values of financial instruments as of September 30, 2020 and December 31, 2019:

		September 30, 2020				December 31, 2019
		Carrying Value		Fair Value		Carrying Value		Fair Value
Assets carried at historical cost on the condensed consolidated balance sheets:
Investments in debt securities(1)	Level 2	$	309,122	$	312,661	$	316,991	$	318,299
Liabilities carried at historical cost on the condensed consolidated balance sheets:
Mortgage loans(2)	Level 2	$	6,108,880	$	6,181,214	$	6,266,407	$	6,292,261
Secured Term Loan(3)	Level 3	403,363		461,617		403,464		411,213
Term Loan Facility(4)	Level 3	1,500,000		1,499,446		1,500,000		1,500,444
Convertible Senior Notes(5)	Level 3	338,112		352,103		334,299		346,489

(1)The carrying values of investments in debt securities are shown net of discount.

(2)The carrying values of the mortgage loans are shown net of discount and exclude $13,900 and $27,946 of deferred financing costs as of September 30, 2020 and December 31, 2019, respectively.

(3)The carrying value of the Secured Term Loan excludes $2,323 and $2,486 of deferred financing costs as of September 30, 2020 and December 31, 2019, respectively.

(4)The carrying value of the Term Loan Facility excludes $4,087 and $6,253 of deferred financing costs as of September 30, 2020 and December 31, 2019, respectively.

(5)The carrying values of the Convertible Senior Notes include unamortized discounts of $6,888 and $10,701 as of September 30, 2020 and December 31, 2019, respectively.

The fair values of our investment in debt securities and mortgage loans, which are classified as Level 2 in the fair value hierarchy, are estimated based on market bid prices of comparable instruments at the end of the period. The following table displays the significant unobserverable inputs used to develop our Level 3 fair value measurements as of September 30, 2020:

	Quantitative Information about Level 3 Fair Value Measurement(1)
	Fair Value		Valuation Technique	Unobservable Input	Rate
Secured Term Loan	$	461,617	Discounted Cash Flow	Effective Rate	2.08%
Term Loan Facility	1,499,446		Discounted Cash Flow	Effective Rate	1.88	%	—	1.91%
Convertible Senior Notes	352,103		Discounted Cash Flow	Effective Rate	1.88%

(1)Our Level 3 fair value instruments require interest only monthly payments.

35

INVITATION HOMES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

(unaudited)

Nonrecurring Fair Value Measurements

Our assets measured at fair value on a nonrecurring basis are those assets for which we have recorded impairments.

Single-Family Residential Properties

The single-family residential properties for which we have recorded impairments, measured at fair value on a nonrecurring basis, are summarized below:

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2020		2019		2020		2019
Investments in single-family residential properties, net held for use (Level 3):
Pre-impairment amount	$	—	$	885	$	451	$	8,438
Total impairments	—		(254)		(89)		(2,072)
Fair value	$	—	$	631	$	362	$	6,366

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2020		2019		2020		2019
Investments in single-family residential properties, net held for sale (Level 3):
Pre-impairment amount	$	1,800	$	18,723	$	19,594	$	49,837
Total impairments	(289)		(3,706)		(4,113)		(9,217)
Fair value	$	1,511	$	15,017	$	15,481	$	40,620

For additional information related to our single-family residential properties as of September 30, 2020 and December 31, 2019, refer to Note 3.

ROU Lease Assets

During the three months ended September 30, 2020, we relocated one of our corporate offices and vacated the former location. As of September 30, 2020, the expected undiscounted sublease payments through the remaining original lease term of the vacated office space no longer exceed the carrying value of the related ROU lease asset, and we concluded that the ROU lease asset was not fully recoverable. During the three and nine months ended September 30, 2020, we recorded impairment of $1,750 in other, net in the condensed consolidated statements of operations. The fair value of the ROU lease asset measured at fair value on a nonrecurring basis, which is classified as Level 3 in the fair value hierarchy, was determined based on a discounted cash flow analysis reflective of the income expected from a sublease. For additional information related to our ROU lease assets as of September 30, 2020 and December 31, 2019, refer to Note 5.

36

INVITATION HOMES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

(unaudited)

Note 12—Earnings per Share

Basic and diluted EPS are calculated as follows:

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2020		2019		2020		2019
(in thousands, except share and per share data)
Numerator:
Net income available to common stockholders — basic and diluted	$	32,540	$	33,616	$	125,178	$	93,165
Denominator:
Weighted average common shares outstanding — basic	560,598,995		537,771,245		550,722,684		528,209,033
Effect of dilutive securities:
Incremental shares attributed to non-vested share-based awards	1,272,378		873,643		1,224,594		951,320
Weighted average common shares outstanding — diluted	561,871,373		538,644,888		551,947,278		529,160,353
Net income per common share — basic	$	0.06	$	0.06	$	0.23	$	0.18
Net income per common share — diluted	$	0.06	$	0.06	$	0.23	$	0.18

Incremental shares attributed to non-vested share-based awards are excluded from the computation of diluted EPS when they are anti-dilutive. For the three and nine months ended September 30, 2020, 153,114 and 120,835 incremental shares attributed to non-vested share-based awards, respectively, are excluded from the denominator as their inclusion would have been anti-dilutive. For the nine months ended September 30, 2019, 376 incremental shares attributed to non-vested share-based awards are excluded from the denominator as their inclusion would have been anti-dilutive. For the three months ended September 30, 2019, all incremental shares attributed to non-vested share-based awards were included in the denominator.

For the three and nine months ended September 30, 2020 and 2019, the vested OP Units have been excluded from the computation of EPS because all income attributable to the OP Units has been recorded as non-controlling interest and thus excluded from net income available to common stockholders.

For the nine months ended September 30, 2019, using the “if-converted” method, 8,323,258 potential shares of common stock for the 2019 Convertible Notes for the period prior to conversion are excluded from the computation of diluted EPS as they are anti-dilutive. For the three and nine months ended September 30, 2020 and 2019, 15,100,443 potential shares of common stock issuable upon the conversion of the 2022 Convertible Notes are also excluded from the computation of diluted EPS as they are anti-dilutive. Additionally, no adjustment to the numerator is required for interest expense related to the Convertible Senior Notes for the three and nine months ended September 30, 2020 and 2019. See Note 6 for further discussion about the Convertible Senior Notes.

Note 13—Income Tax

We account for income taxes under the asset and liability method. For our taxable REIT subsidiaries (“TRSs”), deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using the enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. We provide a valuation allowance, from time to time, for deferred tax assets for which we do not consider realization of such assets to be more likely than not.

As of September 30, 2020 and December 31, 2019, we have not recorded any deferred tax assets and liabilities or unrecognized tax benefits. We do not anticipate a significant change in unrecognized tax benefits within the next 12 months.

We have sold assets that were either subject to Section 337(d) of the Internal Revenue Code of 1986, as amended, or were held by TRSs. These transactions resulted in $293 and $576 of current income tax expense for the three months ended September 30, 2020 and 2019, respectively, and $722 and $2,181 of current income tax expense for the nine months ended September 30, 2020 and 2019, which has been recorded in gain on sale of property, net of tax in the condensed consolidated statements of operations.

37

INVITATION HOMES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

(unaudited)

Note 14—Commitments and Contingencies

Lease Commitments

The following table sets forth our fixed lease payment commitments as a lessee as of September 30, 2020, for the periods below:

Year	Operating Leases		Finance Leases
Remainder of 2020	$	1,219	$	792
2021	4,840		3,109
2022	3,846		2,526
2023	2,858		2,475
2024	2,500		714
Thereafter	1,096		—
Total lease payments	16,359		9,616
Less: imputed interest	(1,169)		(637)
Total lease liability	$	15,190	$	8,979

The components of lease expense for the three and nine months ended September 30, 2020 and 2019 are as follows:

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2020		2019		2020		2019
Operating lease cost:
Fixed lease cost	$	1,106	$	1,140	$	3,257	$	3,037
Variable lease cost	263		323		860		1,022
Total operating lease cost	$	1,369	$	1,463	$	4,117	$	4,059
Finance lease cost:
Amortization of ROU assets	$	707	$	137	$	1,628	$	374
Interest on lease liabilities	101		22		371		40
Total finance lease cost	$	808	$	159	$	1,999	$	414

Insurance Policies

Pursuant to the terms of certain of our loan agreements (see Note 6), laws and regulations of the jurisdictions in which our properties are located, and general business practices, we are required to procure insurance on our properties. As of September 30, 2020, there are no material contingent liabilities related to uninsured losses with respect to our properties.

Legal Matters

We are subject to various legal proceedings and claims that arise in the ordinary course of our business. We accrue a liability when we believe that it is both probable that a liability has been incurred and that we can reasonably estimate the amount of the loss. We do not believe that the final outcome of these proceedings or matters will have a material adverse effect on our condensed consolidated financial statements.

Note 15—Subsequent Events

In connection with the preparation of the accompanying condensed consolidated financial statements, we have evaluated events and transactions occurring after September 30, 2020, for potential recognition or disclosure.

38

INVITATION HOMES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

(unaudited)

Joint Venture with Rockpoint

On October 6, 2020, we entered into an agreement with Rockpoint Group, L.L.C. (“Rockpoint”) to form a joint venture partnership that will acquire single-family homes to operate as rental residences. The joint venture will be capitalized with a total equity commitment of $375,000, of which $75,000 (20%) will be committed by us and $300,000 (80%) will be committed by Rockpoint. We will provide investment, asset management, and property management services to the joint venture, will earn asset management and property management fees, and have the opportunity to earn a promoted interest subject to certain performance thresholds.

Acquisition of Single-family Residential Properties

In October 2020, we completed two bulk acquisitions for a total of 327 single-family residential properties for $65,739.

Extensions of Existing Mortgage Loans

On October 1, 2020, we submitted a notification to request an extension of the maturity date of the IH 2018-4 mortgage loan from January 9, 2021 to January 9, 2022.

On October 9, 2020, the extension of the maturity date of the SWH 2017-1 mortgage loan from October 9, 2020 to October 9, 2021 was approved by the lender.

Dividend Declaration

On October 22, 2020, our board of directors declared a dividend of $0.15 per share to stockholders of record on November 10, 2020, which is payable on November 25, 2020.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the information appearing elsewhere in this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K. This discussion and analysis contains forward-looking statements based upon our current expectations that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth under Part I. Item 1A. “Risk Factors” in our Annual Report on Form 10-K and Part II. Item 1A. “Risk Factors” in this Quarterly Report on Form 10-Q.

Capitalized terms used without definition have the meaning provided elsewhere in this Quarterly Report on Form 10-Q.

Overview

Invitation Homes is a leading owner and operator of single-family homes for lease, offering residents high-quality homes in sought-after neighborhoods across America. With approximately 80,000 homes for lease in 16 markets across the country as of September 30, 2020, Invitation Homes is meeting changing lifestyle demands by providing residents access to updated homes with features they value, such as close proximity to jobs and access to good schools. Our mission statement, “Together with you, we make a house a home,” reflects our commitment to high-touch service that continuously enhances residents’ living experiences and provides homes where individuals and families can thrive.

We operate in markets with strong demand drivers, high barriers to entry, and high rent growth potential, primarily in the Western United States, Florida, and the Southeast United States. Through disciplined market and asset selection, as well as through strategic mergers and acquisitions, we designed our portfolio to capture the operating benefits of local density as well as economies of scale that we believe cannot be readily replicated. Since our founding in 2012, we have built a proven, vertically integrated operating platform that enables us to effectively and efficiently acquire, renovate, lease, maintain, and manage our homes.

We invest in markets that we expect will exhibit lower new supply, stronger job and household formation growth, and superior net operating income (“NOI”) growth relative to the broader United States housing and rental markets. Within our 16 markets, we target attractive neighborhoods in in-fill locations with multiple demand drivers, such as proximity to major employment centers, desirable schools, and transportation corridors. Our homes average approximately 1,870 square feet with three bedrooms and two bathrooms, appealing to a resident base that we believe is less transitory than the typical multifamily resident. We invest in the upfront renovation of homes in our portfolio in order to address capital needs, reduce ongoing maintenance costs, and drive resident demand. The in-fill locations and high quality of our homes and service further differentiate our resident experience, which we continue to refine.

COVID-19

The ongoing COVID-19 pandemic has had a significant adverse impact on global and United States economic activity and has contributed to significant volatility and disruption in financial markets. The ultimate impacts remain unknown, but could include the potential worsening of global and United States economic conditions and the continued disruptions to, and volatility in, the credit and financial markets, consumer spending, and the market for acquisition and disposition of single-family homes, as well as other unanticipated consequences. As such, we are closely monitoring the impact of the ongoing COVID-19 pandemic on all aspects of our business, including operating, investment management, and capital markets activities.

With the safety and well-being of our residents and associates being our highest priority, we continue to follow protocols that enable teams to safely continue providing outstanding service to residents. The safety and service measures currently in place include: (1) creating and implementing a safety training program for all associates; (2) maintaining a three-month supply of masks, gloves, shoe covers, and hand sanitizer for field teams; (3) continuing to leverage self-show and virtual-tour technology as both safety measures and competitive advantages; (4) adhering to strict safety protocols for maintenance service trips; and (5) adapting to offer virtual options for resident move-in orientations and pre-move-out visits.

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Neither these procedural adjustments nor the overall impact of the COVID-19 pandemic created significant disruptions to our business model during the three and nine months ended September 30, 2020. However, the pandemic did impact our business, including operating, investment management, and capital markets activities as more fully described below.

Operations

The direct impacts on our results of operations and key operating metrics from the effects of the COVID-19 pandemic may include, but are not limited to: (1) a decrease in gross rental revenues and other property income (before concessions and bad debt) due to jurisdictional restrictions on rent increases and late fees and/or forgiveness of late fees for residents who have requested leniency; (2) an increase in occupancy due to lower turnover partially driven by residents’ decisions not to relocate during the pandemic, strong demand for homes that become vacant, and the impact of eviction moratoriums; (3) an increase in uncollectible revenues (or decline in rent collections percentages) due to resident hardships and eviction moratoriums; and (4) a decrease in property operating and maintenance expenses for turnover costs (lower turnover rates) and property administrative fees (eviction moratoriums).

In March, to act on our core values of "Genuine Care" and "Standout Citizenship," we began to offer solutions for residents experiencing financial hardship when requested, including the ongoing creation of payment plans, without late fees, for residents requiring flexibility to meet rental obligations over time and a voluntary moratorium on evictions through June 2020. Additionally, we continue to adhere to federal, state, and local restrictions on items such as evictions, collections, rent increases, and late fees as appropriate.

The ongoing COVID-19 outbreak in the United States has led entities directed by, or notionally affiliated with, the Federal government as well as certain states and cities, including those in which we own properties and where our principal places of business are located, to impose and continue to implement measures intended to control the spread of COVID-19, including instituting quarantines, restrictions on travel, “shelter in place” rules, and restrictions on types of business that may continue to operate. We depend on rental revenues and other property income from residents for substantially all of our revenues. Overall revenue collections as a percentage of monthly billings was 97% for the three months ended September 30, 2020, compared to a historical average of 99%. While collection of revenues has remained near historical levels thus far through the pandemic, the COVID-19 outbreak, as well as continuing measures taken by governmental authorities and private actors to limit the spread of this virus or mitigate its impact, is interfering with the ability of some of our residents to meet their lease obligations and make their rent payments on time or at all. In addition, entities directed by, or notionally affiliated with, the Federal government as well as some jurisdictions across the United States have imposed temporary eviction moratoriums and are allowing residents to defer missed rent payments without incurring late fees, and jurisdictions and other local and national authorities may expand or extend measures imposing restrictions on our ability to enforce residents’ contractual rental obligations and limiting our ability to increase rents. We cannot predict if states, municipalities, local, and/or national authorities will expand existing restrictions, if additional states or municipalities will implement similar restrictions, or when restrictions currently in place will expire. Such measures are likely to enable residents to stay in their homes despite an inability to pay because of financial or other hardship stemming from the pandemic.

Certain other restrictions imposed by jurisdictions across the United States are intended to limit operations by businesses not deemed “essential businesses.” While none of the current restrictions have materially impacted our ability to provide services to our residents or homes, future measures may negatively impact our ability to access our homes, complete service requests, or make our homes ready for new residents. Unless the residents report symptoms of or exposure to COVID-19, we are completing all service calls. In all cases, we work with the residents to ensure service requests are addressed in a timely and safe manner.

While COVID-19 and related containment measures may interfere with the ability of our associates, suppliers, and other business partners to carry out their assigned tasks or to supply materials and services at ordinary levels of performance relative to the conduct of our business in the future, to date we have not experienced significant disruptions of these types. The majority of our office-based associates continue to work from home and will do so until we determine it is in our and their best interests to fully return to our offices. Additionally, changes to the working environment have not had a material effect on our internal controls over financial reporting since the pandemic began (see Part I. Item 4. “Controls and Procedures” for additional information).

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Investment Management

We continue to successfully source and effectuate compelling acquisition and disposition opportunities. Since the pandemic began, we have continued to sell homes identified for disposition. We are also now acquiring new homes at a pre-COVID-19 pace after pausing activity from mid-March through May and entered into a joint venture partnership with Rockpoint (defined below). Despite this recent activity, our ability to acquire or dispose of properties could be impaired by local rules and ordinances that could be put in place to mitigate the impact of the COVID-19 pandemic, and a general decline in economic and business activity could adversely affect the single-family residential housing market and our ability to acquire and dispose of homes.

Joint Venture with Rockpoint

On October 6, 2020, we entered into an agreement with Rockpoint Group, L.L.C. (“Rockpoint”) to form a joint venture partnership that will acquire single-family homes to operate as rental residences. The joint venture will be capitalized with a total equity commitment of $375.0 million, of which $75.0 million (20%) will be committed by us and $300.0 million (80%) will be committed by Rockpoint. A total of over $1.0 billion (including debt) is expected to be deployed by the joint venture to acquire and renovate single-family homes in attractive locations in markets within the Western United States, Southeast United States, Florida, and Texas, where we already own homes. The homes are expected to be of similarly high quality and similar characteristics to the homes in our existing portfolio.

We will provide investment, asset management, and property management services to the joint venture, for which we will earn asset management and property management fees and have the opportunity to earn a promoted interest subject to certain performance thresholds.

The joint venture is anticipated to have a five to eight year term, with certain sale rights in favor of each member, but has the flexibility to continue owning homes for an unlimited period of time if neither member triggers a sale. Upon trigger of a sale by Rockpoint or us, the other member of the joint venture will have a right of first offer to acquire the homes proposed for sale.

We also maintain the ability in all markets to continue deploying capital from our own balance sheet to acquire homes for our portfolio, concurrent with the joint venture’s deployment of capital. In markets where we and the joint venture are investing concurrently, our investment personnel will source acquisitions without knowledge of which entity will acquire the homes, and upon being approved for close, homes will be allocated on a rotational basis between us and the joint venture according to pre-determined ratios of investment between the two entities. In addition, we maintain the right to enter into portfolio acquisitions of ten or more homes outside of the joint venture.

Capital Markets

To date, our access to capital markets has not been significantly impacted by the COVID-19 pandemic. In June 2020, we successfully issued and sold 16.7 million shares of our common stock for net proceeds of $447.5 million to provide capital primarily for acquisition opportunities. We continue to make scheduled debt service payments, including full repayment of the $270.0 million revolving credit facility balance that had been drawn in March, and do not anticipate non-compliance with our key affirmative and negative debt covenants. As of September 30, 2020, we had $1,559.6 million in available liquidity through a combination of unrestricted cash and undrawn capacity on our revolving credit facility (see “ — Liquidity and Capital Resources” for additional information). That said, a severe disruption of, and/or instability in, the global financial markets or deteriorations in credit and financing conditions may affect our access to capital necessary to fund business operations, including acquisitions, or address maturing liabilities on a timely basis.

Ongoing Considerations

The situation surrounding the ongoing COVID-19 pandemic remains fluid, and the ensuing impact of the COVID-19 pandemic on our rental revenues and other property income, in particular, cannot be fully be determined at present due to an inability to estimate actual collection rates, occupancy levels, and expiration of temporary restrictions on evictions, collections, rent increases, and late fees. We will continue to actively manage our response in collaboration with our residents and business partners and to assess potential impacts to our financial position and operating results, as well as potential adverse developments in our business.

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In addition to the foregoing uncertainties, we are unable to predict the impact that the COVID-19 pandemic will have on our future financial condition, results of operations, and cash flows due to numerous uncertainties regarding external factors. These uncertainties include the scope, severity, and duration of the pandemic, the extent and duration of actions taken to contain the pandemic or mitigate its impact, and the direct and indirect economic effects of the pandemic, containment measures, monetary and/or fiscal policies implemented to provide support or relief to businesses and/or residents, and other government, regulatory, and/or legislative changes precipitated by the COVID-19 pandemic, among others. For further information regarding the impact of COVID-19 on our Company, see Part II. Item 1A. “Risk Factors.”

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Our Portfolio

The following table provides summary information regarding our total and Same Store portfolios as of and for the three months ended September 30, 2020 as noted below:

Market	Number of Homes(1)	Average Occupancy(2)	Average Monthly Rent(3)	Average Monthly Rent PSF(3)	% of Revenue(4)
Western United States:
Southern California	7,973	97.9%	$2,533	$1.49	13.1	%
Northern California	4,266	97.6%	2,209	1.42	6.4	%
Seattle	3,604	97.1%	2,301	1.20	5.6	%
Phoenix	7,986	97.2%	1,481	0.90	8.1	%
Las Vegas	2,993	97.8%	1,708	0.86	3.5	%
Denver	2,317	96.1%	2,109	1.16	3.4	%
Western United States Subtotal	29,139	97.4%	2,052	1.19	40.1	%
Florida:
South Florida	8,387	95.7%	2,232	1.20	12.3	%
Tampa	8,087	97.2%	1,721	0.92	9.5	%
Orlando	6,165	96.7%	1,728	0.93	7.2	%
Jacksonville	1,857	97.2%	1,733	0.87	2.2	%
Florida Subtotal	24,496	96.6%	1,898	1.01	31.2	%
Southeast United States:
Atlanta	12,510	97.3%	1,566	0.76	13.2	%
Carolinas	4,826	96.9%	1,633	0.76	5.2	%
Southeast United States Subtotal	17,336	97.2%	1,584	0.76	18.4	%
Texas:
Houston	2,166	95.7%	1,589	0.82	2.3	%
Dallas	2,444	95.3%	1,841	0.88	3.0	%
Texas Subtotal	4,610	95.5%	1,721	0.85	5.3	%
Midwest United States:
Chicago	2,664	96.9%	2,014	1.24	3.5	%
Minneapolis	1,127	98.0%	1,951	1.00	1.5	%
Midwest United States Subtotal	3,791	97.2%	1,995	1.16	5.0	%
Announced Market-in-Exit:
Nashville(5)	25	39.1%	2,004	0.75	—	%
Total / Average	79,397	96.9%	$1,881	$1.01	100.0	%
Same Store Total / Average	71,810	97.8%	$1,881	$1.01	91.3	%

(1)As of September 30, 2020.

(2)Represents average occupancy for the three months ended September 30, 2020.

(3)Represents average monthly rent for the three months ended September 30, 2020.

(4)Represents the percentage of rental revenues and other property income generated in each market for the three months ended September 30, 2020.

(5)In December 2019, we announced a plan to fully exit the Nashville market and sold 708 homes in Nashville in a bulk transaction. As of September 30, 2020, we have 25 remaining homes in the market.

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Factors That Affect Our Results of Operations and Financial Condition

Our results of operations and financial condition are affected by numerous factors, many of which are beyond our control. See Part I. Item 1A. “Risk Factors” in our Annual Report on Form 10-K, as updated in Part II. Item 1A. “Risk Factors” in this Quarterly Report on Form 10-Q, for more information regarding factors that could materially adversely affect our results of operations and financial condition. Key factors that impact our results of operations and financial condition include market fundamentals, rental rates and occupancy levels, turnover rates and days to re-resident homes, property improvements and maintenance, property acquisitions and renovations, and financing arrangements. Sensitivity to many of these factors has been heightened as a result of the ongoing and numerous adverse impacts of COVID-19.

Market Fundamentals: Our results are impacted by housing market fundamentals and supply and demand conditions in our markets, particularly in the Western United States and Florida, which represented 71.3% of our rental revenues and other property income during the three months ended September 30, 2020. We are actively monitoring the impact of the COVID-19 outbreak on market fundamentals and are quickly implementing changes in pricing as market fundamentals shift.

Rental Rates and Occupancy Levels: Rental rates and occupancy levels are primary drivers of rental revenues and other property income. Our rental rates and occupancy levels are affected by macroeconomic factors and local and property-level factors, including market conditions, seasonality, resident defaults, and the amount of time it takes to prepare a home for its next resident and re-lease homes when residents vacate. An important driver of rental rate growth is our ability to increase monthly rents from expiring leases, which typically have a term of one to two years. The ongoing COVID-19 pandemic has negatively impacted our ability to increase rents and may impact our ability to maintain occupancy levels.

Collection Rates: Our rental revenues and other property income is impacted by the rate at which we collect such revenues from our residents. We routinely work with residents facing financial hardships who need flexibility to fulfill their lease obligations, but the ongoing COVID-19 pandemic has increased the number of such residents. When requested, we work with these residents to create payment plans, without late fees, and then actively manage these receivables. However, a portion of these amounts may not ultimately be collected. Any amounts billed to residents that have been deemed uncollectible along with our estimate of amounts that may ultimately be uncollectible decrease our rental revenues and other property income.

Turnover Rates and Days to Re-Resident: Other drivers of rental revenues and property operating and maintenance expense include the length of stay of our residents, resident turnover rates, and the number of days a home is unoccupied between residents. Our operating results are also impacted by the amount of time it takes to market and lease a property, which is a component of the number of days a home is unoccupied between residents. The period of time to market and lease a property can vary greatly and is impacted by local demand, our marketing techniques, the size of our available inventory, and both current economic conditions and future economic outlook, both of which are impacted by the ongoing COVID-19 pandemic. Days to re-resident may be negatively affected by homes potentially remaining vacant while prospective residents remain in their current housing. Our turnover rate may be affected by the current COVID-19 pandemic as a result of delayed eviction proceedings and/or move outs potentially being canceled by residents who have not secured their next housing plans. Increases in turnover rates and the average number of days to re-resident reduce rental revenues as the homes are not generating income during this period of vacancy.

Property Improvements and Maintenance: Property improvements and maintenance impact capital expenditures, property operating and maintenance expense, and rental revenues. We actively manage our homes on a total portfolio basis to determine what capital and maintenance needs may be required, and what opportunities we may have to generate additional revenues or expense savings from such expenditures. Due to our size and scale both nationally and locally, we believe we are able to purchase goods and services at favorable prices.

While the COVID-19 outbreak has required us to modify our property improvement and maintenance procedures to accommodate resident preferences, as a currently designated “essential business” we are completing all maintenance work orders unless a resident reports symptoms of or exposure to COVID-19. However, future potential governmental measures may restrict our ability to function as an “essential business.” Additionally, we have addressed a backlog of deferred work orders that resulted from our initial deferral of all non-emergency work orders at the onset of the pandemic.

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Property Acquisitions and Renovations: Future growth in rental revenues and other property income may be impacted by our ability to identify and acquire homes, our pace of property acquisitions, and the time and cost required to renovate and lease a newly acquired home. Our ability to identify and acquire single-family homes that meet our investment criteria is impacted by home prices in targeted acquisition locations, the inventory of homes available for sale through our acquisition channels, and competition for our target assets. All of these factors may be negatively impacted by the COVID-19 outbreak, potentially reducing the number of homes we acquire.

The acquisition of homes involves expenditures in addition to payment of the purchase price, including payments for acquisition fees, property inspections, closing costs, title insurance, transfer taxes, recording fees, broker commissions, property taxes, and HOA fees (when applicable). Additionally, we typically incur costs to renovate a home to prepare it for rental. The scope of renovation work varies, but may include paint, flooring, carpeting, cabinetry, appliances, plumbing hardware, roof replacement, HVAC replacement, and other items required to prepare the home for rental. The time and cost involved in accessing our homes and preparing them for rental can significantly impact our financial performance. The time to renovate a newly acquired property can vary significantly among homes for several reasons, including the property’s acquisition channel, the condition of the property, whether the property was vacant when acquired, and whether there are any state or local restrictions on our ability to complete renovations as an essential business function. Additionally, COVID-19 and related containment measures may interfere with the ability of our suppliers and other business partners to carry out their assigned tasks and/or source labor or supply materials at ordinary levels of performance relative to the conduct of our business. Due to our size and scale both nationally and locally, we believe we are able to purchase goods and services at favorable prices.

Financing Arrangements: Financing arrangements directly impact our interest expense, mortgage loans, secured term loan, term loan facility, revolving facility, and convertible debt, as well as our ability to acquire and renovate homes. We have historically utilized indebtedness to fund the acquisition and renovation of new homes. Our current financing arrangements contain financial covenants, and certain financing arrangements contain variable interest rate terms. Interest rates are impacted by market conditions and the terms of the underlying financing arrangements. Inability by our residents to meet their lease obligations due to the COVID-19 pandemic could reduce our cash flows, which could impact our ability to make all required debt service payments. Furthermore, the COVID-19 pandemic has resulted in a widespread health crisis adversely affecting the economy and financial markets of many countries resulting in an economic downturn that could negatively affect our ability to access financial markets as well as our business, results of operations, and financial condition. See Part I. Item 3. “Quantitative and Qualitative Disclosures about Market Risk” for further discussion regarding interest rate risk. Our future financing arrangements may not have similar terms with respect to amounts, interest rates, financial covenants, and durations.

Components of Revenues and Expenses

The following is a description of the components of our revenues and expenses.

Revenues

Rental Revenues and Other Property Income

Rental revenues, net of any concessions and bad debt (including write-offs, credit reserves, and uncollectible amounts), consist of rents collected under lease agreements related to our single-family homes for lease. We enter into leases directly with our residents, and the leases typically have a term of one to two years.

Other property income is comprised of: (i) resident reimbursements for utilities, HOA fines, and other charge-backs; (ii) rent and non-refundable deposits associated with pets; and (iii) various other fees, including late fees and lease termination fees, among others.

Expenses

Property Operating and Maintenance

Once a property is available for its initial lease, which we refer to as “rent-ready,” we incur ongoing property-related expenses, which consist primarily of property taxes, insurance, HOA fees (when applicable), market-level personnel

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expenses, utility expenses, repairs and maintenance, leasing costs, marketing expenses, and property administration. Prior to a property being “rent-ready,” certain of these expenses are capitalized as building and improvements. Once a property is “rent-ready,” expenditures for ordinary repairs and maintenance thereafter are expensed as incurred, and we capitalize expenditures that improve or extend the life of a home.

Property Management Expense

Property management expense represents personnel and other costs associated with the oversight and management of our portfolio of homes. All of our homes are managed through our internal property manager.

General and Administrative

General and administrative expense represents personnel costs, professional fees, and other costs associated with our day-to-day activities. General and administrative expense also includes merger and transaction-related expenses, among other things, that are of a non-recurring nature.

Share-Based Compensation Expense

All share-based compensation expense is recognized in our condensed consolidated statements of operations as components of general and administrative expense and property management expense. We issue share-based awards to align our employees’ interests with those of our investors.

Interest Expense

Interest expense includes interest payable on our debt instruments, payments and receipts related to our interest rate swap agreements, amortization of discounts and deferred financing costs, unrealized gains (losses) on non-designated hedging instruments, and non-cash interest expense related to our interest rate swap agreements.

Depreciation and Amortization

We recognize depreciation and amortization expense associated with our homes and other capital expenditures over their expected useful lives.

Impairment and Other

Impairment and other represents provisions for impairment when the carrying amount of our single-family residential properties is not recoverable and casualty losses, net of any insurance recoveries.

Other, net

Other, net includes interest income, third party management fee income, equity in earnings from an unconsolidated joint venture, unrealized gains from investments in equity securities, and other miscellaneous income and expenses.

Gain on Sale of Property, net of tax

Gain on sale of property, net of tax consists of net gains and losses resulting from sales of our homes.

Results of Operations

Portfolio Information

As of September 30, 2020 and 2019, we owned 79,397 and 80,232 single-family rental homes, respectively, in our total portfolio. During the three months ended September 30, 2020 and 2019, we acquired 544 and 578 homes, respectively, and sold 403 and 668 homes, respectively. During the three months ended September 30, 2020 and 2019, we owned an average of 79,285 and 80,267 single-family rental homes, respectively. During the nine months ended September 30, 2020 and 2019, we acquired 1,195 and 1,526 homes, respectively, and sold 1,303 and 2,101 homes, respectively. During the nine months ended September 30, 2020 and 2019, we owned an average of 79,412 and 80,461 single-family rental homes, respectively.

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We believe presenting information about the portion of our total portfolio that has been fully operational for the entirety of both a given reporting period and its prior year comparison period provides investors with meaningful information about the performance of our comparable homes across periods, and about trends in our organic business. To do so, we provide information regarding the performance of our Same Store portfolio.

As of September 30, 2020, our Same Store portfolio consisted of 71,810 single-family rental homes.

Three Months Ended September 30, 2020 Compared to Three Months Ended September 30, 2019

The following table sets forth a comparison of the results of operations for the three months ended September 30, 2020 and 2019:

	For the Three Months Ended September 30,
($ in thousands)	2020		2019		$ Change		% Change
Rental revenues and other property income	$	459,184	$	443,326	$	15,858	3.6	%
Expenses:
Property operating and maintenance	177,997		175,491		2,506		1.4	%
Property management expense	14,824		15,872		(1,048)		(6.6)	%
General and administrative	17,972		16,405		1,567		9.6	%
Interest expense	87,713		89,067		(1,354)		(1.5)	%
Depreciation and amortization	138,147		133,315		4,832		3.6	%
Impairment and other	1,723		4,740		(3,017)		(63.6)	%
Total expenses	438,376		434,890		3,486		0.8	%
Other, net	(3,049)		4,735		(7,784)		(164.4)	%
Gain on sale of property, net of tax	15,106		20,812		(5,706)		(27.4)	%
Net income	$	32,865	$	33,983	$	(1,118)	(3.3)	%

Rental Revenues and Other Property Income

For the three months ended September 30, 2020 and 2019, total portfolio rental revenues and other property income totaled $459.2 million and $443.3 million, respectively, an increase of 3.6%, driven by an increase in average occupancy, average monthly rent per occupied home, and utilities reimbursements, partially offset by an increase in bad debt, reduced fee income, and a 982 home decrease between periods in the average number of homes owned.

Average occupancy for the three months ended September 30, 2020 and 2019 for the total portfolio was 96.9% and 93.8%, respectively. Average monthly rent per occupied home for the total portfolio for the three months ended September 30, 2020 and 2019 was $1,881 and $1,821, respectively, a 3.3% increase. For our Same Store portfolio, average occupancy was 97.8% and 95.9% for the three months ended September 30, 2020 and 2019, respectively, and average monthly rent per occupied home for the three months ended September 30, 2020 and 2019 was $1,881 and $1,823, respectively, a 3.2% increase.

The annualized turnover rate for the Same Store portfolio for the three months ended September 30, 2020 and 2019 was 29.4% and 35.0%, respectively. For the Same Store portfolio, an average home remained unoccupied for 26 and 40 days between residents for the three months ended September 30, 2020 and 2019, respectively. The decreases in these two metrics contributed to our increase in occupancy on a year over year basis. Furthermore, we believe the decrease in turnover is partially attributable to the effects of the COVID-19 pandemic (e.g., eviction moratoriums and residents who are not inclined to relocate during this period). We cannot predict how long eviction moratoriums will remain in place nor when the general effects of the pandemic will subside and how those items may affect our turnover and occupancy rates.

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To monitor prospective changes in average monthly rent per occupied home, we compare the monthly rent from an expiring lease to the monthly rent from the next lease for the same home, in each case, net of any amortized non-service concessions, to calculate net effective rental rate growth. Leases are either renewal leases, where our current resident stays for a subsequent lease term, or new leases, where our previous resident moves out and a new resident signs a lease to occupy the same home.

Renewal lease net effective rental rate growth for the total portfolio averaged 3.3% and 4.7% for the three months ended September 30, 2020 and 2019, respectively, and new lease net effective rental rate growth for the total portfolio averaged 5.7% and 4.4% for the three months ended September 30, 2020 and 2019, respectively. For our Same Store portfolio, renewal lease net effective rental rate growth averaged 3.3% and 4.8% for the three months ended September 30, 2020 and 2019, respectively, and new lease net effective rental rate growth averaged 5.5% and 4.2% for the three months ended September 30, 2020 and 2019, respectively.

The COVID-19 pandemic has negatively impacted our rental revenues and other property income in three notable ways: (1) lower collection rates, which caused our bad debt to increase from 0.5% of gross rental income for the three months ended September 30, 2019 to 2.1% of gross rental income for the three months ended September 30, 2020 and to increase sequentially from 1.9% of gross rental income for the three months ended June 30, 2020; (2) lower fee income for the three months ended September 30, 2020 resulting from non-enforcement of late fees due to ongoing jurisdictional restrictions and/or forgiveness for residents who have requested leniency; and (3) lower reimbursements of move out and other costs as a result of lower turnover and eviction moratoriums. The decreases in fee income and reimbursements were partially offset by continued increases in utilities reimbursements as more utilities remained in our name compared to the prior year.

The COVID-19 pandemic is likely to continue to affect our collection rates and ability to raise rents and charge fees, and the impact of jurisdictional restrictions on rental rates, late fees, collections, and eviction moratoriums is likely to affect our ability to increase rental revenues and other operating income.

Expenses

For the three months ended September 30, 2020 and 2019, total expenses were $438.4 million and $434.9 million, respectively. Set forth below is a discussion of changes in the individual components of total expenses.

For the three months ended September 30, 2020, property operating and maintenance expense increased to $178.0 million from $175.5 million for the three months ended September 30, 2019. This 1.4% net increase resulted from increases in property taxes and utilities, partially offset by decreases in turnover and property administrative costs that declined due to lower turnover and eviction moratoriums as well as a 982 home decrease between periods in the average number of homes owned. The COVID-19 pandemic is likely to continue to impact our turnover rates, and thus turnover costs, and other property operating and maintenance expense may continue to be affected by the ongoing impacts of the pandemic.

Property management expense and general and administrative expense of $32.8 million for the three months ended September 30, 2020 remained consistent with the $32.3 million of expense for the three months ended September 30, 2019. To date, the COVID-19 pandemic has not had a material impact on our property management and general and administrative expenses.

Interest expense was $87.7 million and $89.1 million for the three months ended September 30, 2020 and 2019, respectively. The decrease in interest expense was primarily driven by a decrease in the average debt balance outstanding during the three months ended September 30, 2020 as compared to the three months ended September 30, 2019 due to various prepayments subsequent to September 30, 2019. Debt outstanding, net of deferred financing costs and discounts, decreased to $8,330.0 million as of September 30, 2020 from $8,655.9 million as of September 30, 2019.

Depreciation and amortization expense increased to $138.1 million for the three months ended September 30, 2020 from $133.3 million for the three months ended September 30, 2019, due to an increase in cumulative capital expenditures. This was partially offset by a decrease in the average number of homes owned during the three months ended September 30, 2020 compared to the three months ended September 30, 2019.

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Impairment and other expenses were $1.7 million and $4.7 million for the three months ended September 30, 2020 and 2019, respectively. During the three months ended September 30, 2020, impairment and other expenses were comprised of impairment losses of $0.3 million on our single-family residential properties and casualty losses of $1.4 million. During the three months ended September 30, 2019, impairment and other expenses were comprised of impairment losses of $4.0 million on our single-family residential properties and casualty losses of $0.7 million. The impairment costs recognized during the three months ended September 30, 2020 were not a direct result of the COVID-19 pandemic.

Other, net

Other, net decreased to $(3.0) million for the three months ended September 30, 2020 from $4.7 million for the three months ended September 30, 2019, primarily due to a $6.5 million unrealized gain on investments in equity securities during the three months ended September 30, 2019 and a $1.8 million right-of-use (“ROU”) lease asset impairment during the three months ended September 30, 2020.

Gain on Sale of Property, net of tax

Gain on sale of property, net of tax was $15.1 million and $20.8 million for the three months ended September 30, 2020 and 2019, respectively. The primary driver of the decrease was a decrease in the number of homes sold from 668 during the three months ended September 30, 2019 to 403 during the three months ended September 30, 2020.

Nine Months Ended September 30, 2020 Compared to Nine Months Ended September 30, 2019

The following table sets forth a comparison of the results of operations for the nine months ended September 30, 2020 and 2019:

	For the Nine Months Ended September 30,
($ in thousands)	2020		2019		$ Change		% Change
Rental revenues and other property income	$	1,358,728	$	1,320,408	$	38,320	2.9	%
Expenses:
Property operating and maintenance	511,915		502,411		9,504		1.9	%
Property management expense	43,725		47,053		(3,328)		(7.1)	%
General and administrative	46,626		58,899		(12,273)		(20.8)	%
Interest expense	258,541		278,756		(20,215)		(7.3)	%
Depreciation and amortization	410,440		399,955		10,485		2.6	%
Impairment and other	4,670		11,803		(7,133)		(60.4)	%
Total expenses	1,275,917		1,298,877		(22,960)		(1.8)	%
Other, net	2,035		8,470		(6,435)		(76.0)	%
Gain on sale of property, net of tax	41,473		64,556		(23,083)		(35.8)	%
Net income	$	126,319	$	94,557	$	31,762	33.6	%

Rental Revenues and Other Property Income

For the nine months ended September 30, 2020 and 2019, total portfolio rental revenues and other property income totaled $1,358.7 million and $1,320.4 million, respectively, an increase of 2.9%, driven by an increase in average occupancy, average monthly rent per occupied home, and utilities reimbursements, partially offset by an increase in bad debt, reduced fee income, and a 1,049 home decrease between periods in the average number of homes owned.

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Average occupancy for the nine months ended September 30, 2020 and 2019 for the total portfolio was 95.8% and 94.4%, respectively. Average monthly rent per occupied home for the total portfolio for the nine months ended September 30, 2020 and 2019 was $1,867 and $1,801, respectively, a 3.7% increase. For our Same Store portfolio, average occupancy was 97.3% and 96.3% for the nine months ended September 30, 2020 and 2019, respectively, and average monthly rent per occupied home for the nine months ended September 30, 2020 and 2019 was $1,866 and $1,802, respectively, a 3.6% increase.

The annualized turnover rate for the Same Store portfolio for the nine months ended September 30, 2020 and 2019 was 27.3% and 31.0%, respectively. For the Same Store portfolio, an average home remained unoccupied for 38 and 45 days between residents for the nine months ended September 30, 2020 and 2019, respectively. The decreases in these two metrics contributed to our increase in occupancy on a year over year basis. Furthermore, we believe the decrease in turnover is partially attributable to the effects of the COVID-19 pandemic (e.g., eviction moratoriums and residents who are not inclined to relocate during this period). We cannot predict how long eviction moratoriums will remain in place nor when the general effects of the pandemic will subside and how those items may affect our turnover and occupancy rates.

To monitor prospective changes in average monthly rent per occupied home, we compare the monthly rent from an expiring lease to the monthly rent from the next lease for the same home, in each case, net of any amortized non-service concessions, to calculate net effective rental rate growth. Leases are either renewal leases, where our current resident stays for a subsequent lease term, or new leases, where our previous resident moves out and a new resident signs a lease to occupy the same home.

Renewal lease net effective rental rate growth for the total portfolio averaged 3.7% and 5.1% for the nine months ended September 30, 2020 and 2019, respectively, and new lease net effective rental rate growth for the total portfolio averaged 3.6% and 4.5% for the nine months ended September 30, 2020 and 2019, respectively. For our Same Store portfolio, renewal lease net effective rental rate growth averaged 3.7% and 5.1% for the nine months ended September 30, 2020 and 2019, respectively, and new lease net effective rental rate growth averaged 3.4% and 4.4% for the nine months ended September 30, 2020 and 2019, respectively.

The COVID-19 pandemic has negatively impacted our rental revenues and other property income in three notable ways: (1) lower collection rates, which caused our bad debt to increase from 0.5% of gross rental income for the nine months ended September 30, 2019 to 1.5% of gross rental income for the nine months ended September 30, 2020; (2) voluntary non-enforcement of and jurisdictional restrictions on late fees during the nine months ended September 30, 2020, which was a primary driver of a decrease in fee income year over year; and (3) lower reimbursements of move out and other costs as a result of lower turnover and eviction moratoriums. The decreases in fee income and reimbursements were partially offset by continued increases in utilities reimbursements as more utilities remained in our name compared to the prior year.

The COVID-19 pandemic is likely to continue to affect our collection rates and ability to raise rents and charge fees, and the impact of jurisdictional restrictions on rental rates, late fees, collections, and eviction moratoriums is likely to affect our ability to increase rental revenues and other operating income.

Expenses

For the nine months ended September 30, 2020 and 2019, total expenses were $1,275.9 million and $1,298.9 million, respectively. Set forth below is a discussion of changes in the individual components of total expenses.

For the nine months ended September 30, 2020, property operating and maintenance expense increased to $511.9 million from $502.4 million for the nine months ended September 30, 2019. This 1.9% net increase resulted from increases in utilities, property taxes, and repairs and maintenance, partially offset by decreases in turnover and property administrative costs that declined due to lower turnover and eviction moratoriums and savings in personnel and other costs. The 1,049 home decrease between periods in the average number of homes owned also offset the increases in certain expense categories. The COVID-19 pandemic is likely to continue to impact our turnover rates, and thus turnover costs, and other property operating and maintenance expense may continue to be affected by the ongoing impacts of the pandemic.

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Property management expense and general and administrative expense decreased to $90.4 million from $106.0 million for the nine months ended September 30, 2020 and 2019, respectively, due to decreases in severance expense of $7.8 million, merger and transaction-related expenses of $4.3 million, and share-based compensation expense of $1.6 million for the nine months ended September 30, 2020 as compared to the nine months ended September 30, 2019. To date, the COVID-19 pandemic has not had a material impact on our property management and general and administrative expenses.

Interest expense was $258.5 million and $278.8 million for the nine months ended September 30, 2020 and 2019, respectively. The decrease in interest expense was primarily driven by a decrease in the average debt balance outstanding during the nine months ended September 30, 2020 as compared to the nine months ended September 30, 2019 due to various prepayments subsequent to September 30, 2019 and settlement of a portion of our convertible debt for common equity during the nine months ended September 30, 2019. Debt outstanding, net of deferred financing costs and discounts, decreased to $8,330.0 million as of September 30, 2020 from $8,655.9 million as of September 30, 2019.

Depreciation and amortization expense increased to $410.4 million for the nine months ended September 30, 2020 from $400.0 million for the nine months ended September 30, 2019 due to an increase in cumulative capital expenditures. This was partially offset by a decrease in the average number of homes owned during the nine months ended September 30, 2020 compared to the nine months ended September 30, 2019.

Impairment and other expenses were $4.7 million and $11.8 million for the nine months ended September 30, 2020 and 2019, respectively. During the nine months ended September 30, 2020, impairment and other expenses was comprised of impairment losses of $4.2 million on our single-family residential properties and casualty losses of $0.5 million. During the nine months ended September 30, 2019, impairment and other expenses was comprised of impairment losses of $11.3 million on our single-family residential properties and casualty losses of $0.5 million. The impairment costs recognized during the nine months ended September 30, 2020 were not a direct result of the COVID-19 pandemic.

Other, net

Other, net decreased to $2.0 million for the nine months ended September 30, 2020 from $8.5 million for the nine months ended September 30, 2019, primarily due to a $6.5 million unrealized gain on investments in equity securities during the nine months ended September 30, 2019 and a $1.8 million ROU lease asset impairment during the three months ended September 30, 2020.

Gain on Sale of Property, net of tax

Gain on sale of property, net of tax was $41.5 million and $64.6 million for the nine months ended September 30, 2020 and 2019, respectively. The primary driver of the decrease was a decrease in the number of homes sold from 2,101 during the nine months ended September 30, 2019 to 1,303 during the nine months ended September 30, 2020.

Liquidity and Capital Resources

Our liquidity and capital resources as of September 30, 2020 and December 31, 2019 include unrestricted cash and cash equivalents of $559.6 million and $92.3 million, respectively, a 506.5% increase. In May 2020, we used cash on hand to repay $120.0 million of the $270.0 million revolving facility (the “Revolving Facility”) that had previously been outstanding. In June 2020, we completed an underwritten public offering to sell 16,675,000 shares of our common stock and generated net proceeds of $447.5 million, and $150.0 million of the proceeds were used to fully repay the balance outstanding on our Revolving Facility. The remaining proceeds are expected to be used primarily for acquisitions. As of September 30, 2020, our $1,000.0 million Revolving Facility remains undrawn, and there are no restrictions on our ability to draw additional funds from the Revolving Facility provided we remain in compliance with all covenants. We have no debt maturing before 2022 provided all extension options are exercised.

Our ability to access capital as well as to use cash from operations to continue to meet our liquidity needs, all of which are highly uncertain and cannot be predicted, could be affected by various risks and uncertainties, including, but not limited to, the effects of the COVID-19 pandemic, as detailed in Part II. Item 1A. “Risk Factors” in this Quarterly Report on Form 10-Q and in the risk factors identified in other reports we have filed with the SEC, including without limitation our Annual Report on Form 10-K for the year ended December 31, 2019.

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Through September 30, 2020, disposition channels remained healthy in our markets, and we continued to sell homes that had been designated for disposition. We have limited cash commitments outside of debt service as we do not engage in any development activity, and the pipeline of acquisitions to which we are committed is $184.9 million as of September 30, 2020. However, the ongoing impact of the COVID-19 pandemic may impact the acquisition and disposition of single-family homes in ways that we are unable to predict.

Liquidity is a measure of our ability to meet potential cash requirements, maintain our assets, fund our operations, make dividend payments to our stockholders, and meet other general requirements of our business. Our liquidity, to a certain extent, is subject to general economic, financial, competitive, and other factors beyond our control. Our near-term liquidity requirements consist primarily of: (i) renovating newly-acquired homes; (ii) funding HOA fees (as applicable), property taxes, insurance premiums, and the ongoing maintenance of our homes; (iii) interest expense; (iv) payment of dividends to our equity investors; and (v) required contributions to the Rockpoint joint venture. We believe our rental income, net of total expenses, will generally provide cash flow sufficient to fund operations and dividend payments on a near-term basis.

However, the COVID-19 pandemic may negatively impact our operating cash flow such that we are unable to make required debt service payments, which would result in an event of default for any such loan agreement under which payments were not made. Specifically, the collateral within individual borrower entities may underperform, resulting in cash flow shortfalls for debt service while consolidated cash flows are sufficient to fund our operations. If an event of default occurs for a specific mortgage loan or for our secured term loan, our loan agreements provide certain remedies, including our ability to fund shortfalls from consolidated cash flow; and such an event of default would not result in an immediate acceleration of the loan.

Our real estate assets are illiquid in nature. A timely liquidation of assets may not be a viable source of short-term liquidity should a cash flow shortfall arise, and we may need to source liquidity from other financing sources, such as the Revolving Facility, which had an undrawn balance of $1,000.0 million as of September 30, 2020.

Our long-term liquidity requirements consist primarily of funds necessary to pay for the acquisition of, and non-recurring capital expenditures for, our homes and principal payments on our indebtedness.

We intend to satisfy our long-term liquidity needs through cash provided by operations, long-term secured and unsecured borrowings, the issuance of debt and equity securities, and property dispositions. As a REIT, we are required to distribute to our stockholders at least 90% of our taxable income, excluding net capital gain, on an annual basis. Therefore, as a general matter, it is unlikely that we will be able to retain substantial cash balances from our annual taxable income that could be used to meet our liquidity needs. Instead, we will need to meet these needs from external sources of capital and amounts, if any, by which our cash flow generated from operations exceeds taxable income.

On August 22, 2019, we entered into distribution agreements with a syndicate of banks (the “Agents”), pursuant to which we may sell, from time to time, up to an aggregate sales price of $800.0 million of our common stock through the Agents (the “ATM Equity Program”). During the nine months ended September 30, 2020, we sold 1,887,466 shares of our common stock under our ATM Equity Program, generating net proceeds of $56.3 million after giving effect to Agent commissions and other costs totaling $1.0 million. During the three and nine months ended September 30, 2019, we sold 671,020 shares of our common stock under our ATM Equity Program, generating net proceeds of $17.7 million after giving effect to Agent commissions and other costs totaling $1.1 million. We did not sell any shares of common stock under the ATM Equity Program during the three months ended September 30, 2020. As of September 30, 2020, $685.8 million remains available for future offerings under the ATM Equity Program.

Certain Securitizations, the Secured Term Loan, the Term Loan Facility (all defined below), and the Revolving Facility (collectively, the “LIBOR-Based Loans”) use London Interbank Offer Rate (“LIBOR”) as a benchmark for establishing interest rates. Our derivative instruments are also indexed to LIBOR. The Financial Conduct Authority in the United Kingdom, the governing body responsible for regulating LIBOR, announced that it will no longer compel or persuade financial institutions and panel banks to make LIBOR submissions after 2021. Once LIBOR is phased out, the interest rates for our LIBOR-Based Loans will be based on a comparable or successor rate as provided for in our loan agreements. We will work with the counterparties to our swap and cap agreements to adjust each floating rate to a comparable or successor rate. While we do not expect that the transition from LIBOR and risks related thereto will have a material adverse effect on our financing costs, the ultimate outcome of this change is uncertain at this time, and significant management time and attention may be required to transition to using the new benchmark rates and to implement necessary changes to our financial models.

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The following describes the key terms of our current indebtedness.

Mortgage Loans

Our securitization transactions (the “Securitizations” or the “mortgage loans”) are collateralized by certain homes owned by wholly owned subsidiaries of INVH LP that were formed to facilitate certain of our financing arrangements (the “Borrower Entities”). We utilize the proceeds from our securitizations to fund: (i) repayments of then-outstanding indebtedness; (ii) initial deposits into Securitization reserve accounts; (iii) closing costs in connection with the mortgage loans; and (iv) general costs associated with our operations.

The following table sets forth a summary of our mortgage loan indebtedness as of September 30, 2020 and December 31, 2019:

					Outstanding Principal Balance(5)
($ in thousands)	Maturity Date(1)	Maturity Date if Fully Extended(2)	Interest Rate(3)	Range of Spreads(4)	September 30, 2020		December 31, 2019
IH 2017-1(6)	June 9, 2027	June 9, 2027	4.23%	N/A	$	994,699	$	995,520
SWH 2017-1(7)(8)	October 9, 2020	January 9, 2023	1.72%	102-347 bps	732,778		744,092
IH 2017-2(7)(9)	December 9, 2020	December 9, 2024	1.30%	91-186 bps	614,031		624,475
IH 2018-1(7)	March 9, 2021	March 9, 2025	1.27%	76-206 bps	775,118		793,720
IH 2018-2(7)	June 9, 2021	June 9, 2025	1.49%	95-230 bps	928,939		957,135
IH 2018-3(7)	July 9, 2021	July 9, 2025	1.50%	105-230 bps	1,138,876		1,213,035
IH 2018-4(7)(10)	January 9, 2021	January 9, 2026	1.57%	115-225 bps	924,439		938,430
Total Securitizations					6,108,880		6,266,407
Less: deferred financing costs, net					(13,900)		(27,946)
Total					$	6,094,980	$	6,238,461

(1)The maturity dates above reflect all extension options that have been exercised.

(2)Represents the maturity date if we exercise each of the remaining one year extension options available, which are subject to certain conditions being met.

(3)Except for IH 2017-1, interest rates are based on a weighted average spread over LIBOR, plus applicable servicing fees; as of September 30, 2020, LIBOR was 0.15%. Our IH 2017-1 mortgage loan bears interest at a fixed rate of 4.23% per annum, equal to the market determined pass-through rate payable on the certificates including applicable servicing fees.

(4)Range of spreads is based on outstanding principal balances as of September 30, 2020.

(5)Outstanding principal balance is net of discounts and does not include deferred financing costs, net.

(6)Net of unamortized discount of $2.4 million and $2.6 million as of September 30, 2020 and December 31, 2019, respectively.

(7)The initial maturity term of each of these mortgage loans is two years, individually subject to three to five, one year extension options at the Borrower Entity’s discretion (provided that there is no continuing event of default under the mortgage loan agreement and the Borrower Entity obtains and delivers a replacement interest rate cap agreement from an approved counterparty within the required timeframe to the lender). Our SWH 2017-1, IH 2017-2, IH 2018-1, IH 2018-2 and IH 2018-3 mortgage loans have exercised the first extension option. The maturity dates above reflect all extensions that have been exercised.

(8)On October 9, 2020, the extension of the maturity date of the SWH 2017-1 mortgage loan from October 9, 2020 to October 9, 2021 was approved by the lender.

(9)On September 2, 2020, we submitted a notification to request an extension of the maturity of the IH 2017-2 mortgage loan from December 9, 2020 to December 9, 2021.

(10)On October 1, 2020, we submitted a notification to request an extension of the maturity date of the IH 2018-4 mortgage loan from January 9, 2021 to January 9, 2022.

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Securitization Transactions

For each Securitization transaction, the Borrower Entity executed a loan agreement with a third party lender. Except for IH 2017-1, each outstanding mortgage loan originally consisted of six floating rate components. The two year initial terms are individually subject to three to five, one year extension options at the Borrower Entity’s discretion. Such extensions are available provided there is no continuing event of default under the respective mortgage loan agreement and the Borrower Entity obtains and delivers a replacement interest rate cap agreement from an approved counterparty within the required timeframe to the lender. IH 2017-1 is a 10 year, fixed rate mortgage loan comprised of two components. Certificates issued by the trust in connection with Component A of IH 2017-1 benefit from the Federal National Mortgage Association’s guaranty of timely payment of principal and interest.

Each mortgage loan is secured by a pledge of the equity in the assets of the respective Borrower Entities, as well as first-priority mortgages on the underlying properties and a grant of security interests in all of the related personal property. As of September 30, 2020 and December 31, 2019, a total of 35,651 and 37,040 homes, respectively, with a net book value of $6,800.4 million and $7,137.6 million, respectively, are pledged pursuant to the mortgage loans. Each Borrower Entity has the right, subject to certain requirements and limitations outlined in the respective loan agreements, to substitute properties. We are obligated to make monthly payments of interest for each mortgage loan.

Transactions with Trusts

Concurrent with the execution of each mortgage loan agreement, the respective third party lender sold each loan it originated to individual depositor entities (the “Depositor Entities”) who subsequently transferred each loan to Securitization-specific trust entities (the “Trusts”). The Depositor Entities for our currently outstanding Securitizations are wholly owned subsidiaries.

As consideration for the transfer of each loan to the Trusts, the Trusts issued classes of certificates which mirror the components of the individual loans (collectively, the “Certificates”) to the Depositor Entities, except that Class R certificates do not have related loan components as they represent residual interests in the Trusts. The Certificates represent the entire beneficial interest in the Trusts. Following receipt of the Certificates, the Depositor Entities sold the Certificates to investors and used the proceeds as consideration for the loans sold to the Depositor Entities by the lenders. These transactions had no effect on our condensed consolidated financial statements other than with respect to Certificates we retained in connection with Securitizations or purchased at a later date.

The Trusts are structured as pass-through entities that receive interest payments from the Securitizations and distribute those payments to the holders of the Certificates. The assets held by the Trusts are restricted and can only be used to fulfill the obligations of those entities. The obligations of the Trusts do not have any recourse to the general credit of any entities in these condensed consolidated financial statements. We have evaluated our interests in certain certificates of the Trusts held by us (discussed below) and determined that they do not create a more than insignificant variable interest in the Trusts. Additionally, the retained certificates do not provide us with any ability to direct activities that could impact the Trusts’ economic performance. Therefore, we do not consolidate the Trusts.

Retained Certificates

As the Trusts made Certificates available for sale to both domestic and foreign investors, sponsors of the mortgage loans are required to retain a portion of the risk that represents a material net economic interest in each loan pursuant to Regulation RR (the “Risk Retention Rules”) under the Securities Exchange Act of 1934, as amended. As such, loan sponsors are required to retain a portion of the credit risk that represents not less than 5% of the aggregate fair value of the loan as of the closing date.

IH 2017-1 issued Class B certificates, which are restricted certificates that were made available exclusively to INVH LP in order to comply with the Risk Retention Rules. The Class B certificates bear a stated annual interest rate of 4.23%, including applicable servicing fees.

For SWH 2017-1, IH 2017-2, IH 2018-1, IH 2018-2, IH 2018-3, and IH 2018-4, we retain 5% of each class of certificates to meet the Risk Retention Rules. These retained certificates accrue interest at a floating rate of LIBOR plus a spread ranging from 0.76% to 3.47%.

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The retained certificates total $309.1 million and $317.0 million as of September 30, 2020 and December 31, 2019, respectively, and are classified as held to maturity investments and recorded in other assets, net on the condensed consolidated balance sheets.

Loan Covenants

The general terms that apply to all of the mortgage loans require each Borrower Entity to maintain compliance with certain affirmative and negative covenants. Affirmative covenants include each Borrower Entity’s, and certain of their respective affiliates’, compliance with (i) licensing, permitting and legal requirements specified in the mortgage loan agreements, (ii) organizational requirements of the jurisdictions in which they are organized, (iii) federal and state tax laws, and (iv) books and records requirements specified in the respective mortgage loan agreements. Negative covenants include each Borrower Entity’s, and certain of their affiliates’, compliance with limitations surrounding (i) the amount of each Borrower Entity’s indebtedness and the nature of their investments, (ii) the execution of transactions with affiliates, (iii) the Manager, (iv) the nature of each Borrower Entity’s business activities, and (v) the required maintenance of specified cash reserves. As of September 30, 2020, and through the date our condensed consolidated financial statements were issued, we believe each Borrower Entity is in compliance with all affirmative and negative covenants.

Prepayments

For the mortgage loans, prepayments of amounts owed by us are generally not permitted under the terms of the respective mortgage loan agreements unless such prepayments are made pursuant to the voluntary election or mandatory provisions specified in such agreements. The specified mandatory provisions become effective to the extent that a property becomes characterized as a disqualified property, a property is sold, and/or upon the occurrence of a condemnation or casualty event associated with a property. To the extent either a voluntary election is made, or a mandatory prepayment condition exists, in addition to paying all interest and principal, we must also pay certain breakage costs as determined by the loan servicer and a spread maintenance premium if prepayment occurs before the month following the one or two year anniversary of the closing dates of each of the mortgage loans except for IH 2017-1. For IH 2017-1, prepayments on or before December 2026 will require a yield maintenance premium. For the nine months ended September 30, 2020 and 2019, we made voluntary and mandatory prepayments of $157.8 million and $798.4 million, respectively, under the terms of the mortgage loan agreements. During the nine months ended September 30, 2019, prepayments included the full repayment of the CSH 2016-2 mortgage loan.

Secured Term Loan

On June 7, 2019, 2019-1 IH Borrower LP, a consolidated subsidiary (“2019-1 IH Borrower” and one of our Borrower Entities), entered into a 12 year loan agreement with a life insurance company (the “Secured Term Loan”). The Secured Term Loan bears interest at a fixed rate of 3.59%, including applicable servicing fees, for the first 11 years and bears interest at a floating rate based on a spread of 147 bps, including applicable servicing fees, over one month LIBOR (subject to certain adjustments as outlined in the loan agreement) for the twelfth year. The Secured Term Loan is secured by first priority mortgages on a portfolio of single-family rental properties as well as a first priority pledge of the equity interests of 2019-1 IH Borrower. We utilized the proceeds from the Secured Term Loan to fund: (i) repayments of then-outstanding indebtedness; (ii) initial deposits into the Secured Term Loan’s reserve accounts; (iii) transaction costs related to the closing of the Secured Term Loan; and (iv) general corporate purposes.

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The following table sets forth a summary of our Secured Term Loan indebtedness as of September 30, 2020 and December 31, 2019:

($ in thousands)	Maturity Date	Interest Rate(1)	September 30, 2020		December 31, 2019
Secured Term Loan	June 9, 2031	3.59%	$	403,363	$	403,464
Deferred financing costs, net			(2,323)		(2,486)
Secured Term Loan, net			$	401,040	$	400,978

(1)The Secured Term Loan bears interest at a fixed rate of 3.59% per annum including applicable servicing fees for the first 11 years and for the twelfth year bears interest at a floating rate based on a spread of 147 bps over one month LIBOR (or a comparable or successor rate as provided for in our loan agreement), including applicable servicing fees, subject to certain adjustments as outlined in the loan agreement. Interest payments are made monthly.

Collateral

The Secured Term Loan’s collateral pool contains 3,332 and 3,333 homes, respectively, as of September 30, 2020 and December 31, 2019, with a net book value of $724.0 million and $734.8 million, respectively. 2019-1 IH Borrower has the right, subject to certain requirements and limitations outlined in the loan agreement, to substitute properties representing up to 20% of the collateral pool annually, and to substitute properties representing up to 100% of the collateral pool over the life of the Secured Term Loan. In addition, four times after the first anniversary of the closing date, 2019-1 IH Borrower has the right, subject to certain requirements and limitations outlined in the loan agreement, to execute a special release of collateral representing up to 15% of the then-outstanding principal balance of the Secured Term Loan in order to bring the loan-to-value ratio back in line with the Secured Term Loan’s loan-to-value ratio as of the closing date. Any such special release of collateral would not change the then-outstanding principal balance of the Secured Term Loan, but rather would reduce the number of single-family rental homes included in the collateral pool.

Loan Covenants

The Secured Term Loan requires 2019-1 IH Borrower to maintain compliance with certain affirmative and negative covenants. Affirmative covenants include 2019-1 IH Borrower’s, and certain of its affiliates’, compliance with (i) licensing, permitting and legal requirements specified in the loan agreement, (ii) organizational requirements of the jurisdictions in which they are organized, (iii) federal and state tax laws, and (iv) books and records requirements specified in the loan agreement. Negative covenants include 2019-1 IH Borrower’s, and certain of its affiliates’, compliance with limitations surrounding (i) the amount of 2019-1 IH Borrower’s indebtedness and the nature of its investments, (ii) the execution of transactions with affiliates, (iii) the Manager, (iv) the nature of 2019-1 IH Borrower’s business activities, and (v) the required maintenance of specified cash reserves. As of September 30, 2020, and through the date our condensed consolidated financial statements were issued, we believe 2019-1 IH Borrower is in compliance with all affirmative and negative covenants.

Prepayments

Prepayments of the Secured Term Loan are generally not permitted unless such prepayments are made pursuant to the voluntary election or mandatory provisions specified in the loan agreement. The specified mandatory provisions become effective to the extent that a property becomes characterized as a disqualified property, a property is sold, and/or upon the occurrence of a condemnation or casualty event associated with a property. To the extent either a voluntary election is made, or a mandatory prepayment condition exists, in addition to paying all interest and principal, we must also pay certain breakage costs as determined by the loan servicer and a yield maintenance premium if prepayment occurs before June 9, 2030. For the nine months ended September 30, 2020, we made mandatory prepayments of $0.1 million. No prepayments were made for the nine months ended September 30, 2019.

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Term Loan Facility and Revolving Facility

On February 6, 2017, we entered into a credit agreement with a syndicate of banks, financial institutions, and institutional lenders for a credit facility (the “Credit Facility”), which was amended on December 18, 2017 to include all entities and homes acquired in the Mergers. The Credit Facility provides $2,500.0 million of borrowing capacity and consists of a $1,000.0 million Revolving Facility, which will mature on February 6, 2021, with a one year extension option, and a $1,500.0 million term loan facility (the “Term Loan Facility”), which will mature on February 6, 2022. The Revolving Facility also includes borrowing capacity available for letters of credit and for short-term borrowings referred to as swing line borrowings, in each case subject to certain sublimits. The Credit Facility provides us with the option to enter into additional incremental credit facilities (including an uncommitted incremental facility that provides us with the option to increase the size of the Revolving Facility and/or the Term Loan Facility by an aggregate amount of up to $1,500.0 million), subject to certain limitations. Proceeds from the Term Loan Facility were used to repay then-outstanding indebtedness and for general corporate purposes. Proceeds from the Revolving Facility are used for general corporate purposes.

The following table sets forth a summary of the outstanding principal amounts under the Credit Facility as of September 30, 2020 and December 31, 2019:

($ in thousands)	Maturity Date	Interest Rate(1)	September 30, 2020		December 31, 2019
Term Loan Facility	February 6, 2022	1.85%	$	1,500,000	$	1,500,000
Deferred financing costs, net			(4,087)		(6,253)
Term Loan Facility, net			$	1,495,913	$	1,493,747
Revolving Facility	February 6, 2021	1.90%	$	—	$	—

(1)Interest rates for the Term Loan Facility and the Revolving Facility are based on LIBOR plus an applicable margin. As of September 30, 2020, the applicable margins were 1.70% and 1.75%, respectively, and LIBOR was 0.15%.

(2)If we exercise the one year extension option, the maturity date will be February 6, 2022.

Interest Rate and Fees

Borrowings under the Credit Facility bear interest, at our option, at a rate equal to a margin over either (a) a LIBOR rate determined by reference to the Bloomberg LIBOR rate (or a comparable or successor rate as provided for in our loan agreement) for the interest period relevant to such borrowing, or (b) a base rate determined by reference to the highest of (1) the administrative agent’s prime lending rate, (2) the federal funds effective rate plus 0.50%, and (3) the LIBOR rate that would be payable on such day for a LIBOR rate loan with a one month interest period plus 1.00%. The margin is based on a total leverage based grid. The margin for the Revolving Facility ranges from 0.75% to 1.30% in the case of base rate loans, and 1.75% to 2.30% in the case of LIBOR rate loans. The margin for the Term Loan Facility ranges from 0.70% to 1.30% in the case of base rate loans, and 1.70% to 2.30% in the case of LIBOR rate loans. In addition, the Credit Facility provides that, upon receiving an investment grade rating on its non-credit enhanced, senior unsecured long term debt of BBB- or better from Standard & Poor’s Rating Services, a division of The McGraw-Hill Companies, Inc., or Baa3 or better from Moody’s Investors Service, Inc. (an “Investment Grade Rating Event”), we may elect to convert to a credit rating based pricing grid.

In addition to paying interest on outstanding principal under the Credit Facility, we are required to pay a facility fee to the lenders under the Revolving Facility in respect of the unused commitments thereunder. The facility fee rate is based on the daily unused amount of the Revolving Facility and is either 0.35% or 0.20% per annum based on the unused facility amount. Upon converting to a credit rating pricing based grid, the unused facility fee will no longer apply and we will be required to pay a facility fee ranging from 0.125% to 0.300%. We are also required to pay customary letter of credit fees.

Prepayments and Amortization

No principal reductions are required under the Credit Facility. We are permitted to voluntarily repay amounts outstanding under the Term Loan Facility at any time without premium or penalty, subject to certain minimum amounts and the payment of customary “breakage” costs with respect to LIBOR loans. Once repaid, no further borrowings will be permitted under the Term Loan Facility.

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Loan Covenants

The Credit Facility contains certain customary affirmative and negative covenants and events of default. Such covenants will, among other things, restrict, subject to certain exceptions, our ability and that of the Subsidiary Guarantors (as defined below) and their respective subsidiaries to (i) engage in certain mergers, consolidations or liquidations, (ii) sell, lease or transfer all or substantially all of their respective assets, (iii) engage in certain transactions with affiliates, (iv) make changes to our fiscal year, (v) make changes in the nature of our business and our subsidiaries, and (vi) incur additional indebtedness that is secured on a pari passu basis with the Credit Facility.

The Credit Facility also requires us, on a consolidated basis with our subsidiaries, to maintain a (i) maximum total leverage ratio, (ii) maximum secured leverage ratio, (iii) maximum unencumbered leverage ratio, (iv) minimum fixed charge coverage ratio, (v) minimum unencumbered fixed charge coverage ratio, and (vi) minimum tangible net worth. If an event of default occurs, the lenders under the Credit Facility are entitled to take various actions, including the acceleration of amounts due under the Credit Facility and all actions permitted to be taken by a secured creditor. As of September 30, 2020, and through the date our condensed consolidated financial statements were issued, we believe we were in compliance with all affirmative and negative covenants.

Guarantees and Security

The obligations under the Credit Facility are guaranteed on a joint and several basis by each of our direct and indirect domestic wholly owned subsidiaries that own, directly or indirectly, unencumbered assets (the “Subsidiary Guarantors”), subject to certain exceptions. The guarantee provided by any Subsidiary Guarantor will be automatically released upon the occurrence of certain events, including if it no longer has a direct or indirect interest in an unencumbered asset or as a result of certain non-recourse refinancing transactions pursuant to which such Subsidiary Guarantor becomes contractually prohibited from providing its guaranty of the Credit Facility. In addition, INVH may be required to provide a guarantee of the Credit Facility under certain circumstances, including if INVH does not maintain its qualification as a REIT.

The Credit Facility is collateralized by first priority or equivalent security interests in all the capital stock of, or other equity interests in, any Subsidiary Guarantor held by us and each of the Subsidiary Guarantors. The security interests granted under the Credit Facility will be automatically released upon the occurrence of certain events, including upon an Investment Grade Rating Event or if the total net leverage ratio is less than or equal to 8.00:1.00 for four consecutive fiscal quarters.

Convertible Senior Notes

In connection with the Mergers, we assumed SWH’s convertible senior notes. In July 2014, SWH issued $230.0 million in aggregate principal amount of 3.00% convertible senior notes due 2019 (the “2019 Convertible Notes”). Interest on the 2019 Convertible Notes was payable semiannually in arrears on January 1st and July 1st of each year. The notes matured on July 1, 2019, and we settled substantially all of the outstanding balance of the 2019 Convertible Notes through the issuance of 12,553,864 shares of our common stock.

In January 2017, SWH issued $345.0 million in aggregate principal amount of 3.50% convertible senior notes due 2022 (the “2022 Convertible Notes” and together with the 2019 Convertible Notes, the “Convertible Senior Notes”). Interest on the 2022 Convertible Notes is payable semiannually in arrears on January 15th and July 15th of each year. The 2022 Convertible Notes will mature on January 15, 2022.

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The following table summarizes the terms of the Convertible Senior Notes outstanding as of September 30, 2020 and December 31, 2019:

						Principal Amount
($ in thousands)	Coupon Rate	Effective Rate(1)	Conversion Rate(2)	Maturity Date	Remaining Amortization Period	September 30, 2020		December 31, 2019
2022 Convertible Notes	3.50%	5.12%	43.7694	January 15, 2022	1.29 years	$	345,000	$	345,000
Net unamortized fair value adjustment						(6,888)		(10,701)
Total						$	338,112	$	334,299

(1)Effective rate includes the effect of the adjustment to the fair value of the debt as of the Merger Date, the value of which reduced the initial liability recorded to $324.3 million for the 2022 Convertible Notes.

(2)The conversion rate as of September 30, 2020 represents the number of shares of common stock issuable per $1,000 principal amount (actual $) of the 2022 Convertible Notes converted on such date, as adjusted in accordance with the indenture as a result of cash dividend payments and the effects of previous mergers. As of September 30, 2020, the 2022 Convertible Notes do not meet the criteria for conversion. We have the option to settle the 2022 Convertible Notes in cash, common stock, or a combination thereof.

Terms of Conversion

On July 1, 2019, we settled substantially all of the outstanding balance of the 2019 Convertible Notes with the issuance of 12,553,864 shares of our common stock. At the settlement date, the conversion rate applicable to the 2019 Convertible Notes was 54.5954 shares of our common stock per $1,000 principal amount (actual $) of the 2019 Convertible Notes (equivalent to a conversion price of approximately $18.32 per common share — actual $). For the nine months ended September 30, 2019, interest expense for the 2019 Convertible Notes, including non-cash amortization of discounts, was $5.6 million.

As of September 30, 2020, the conversion rate applicable to the 2022 Convertible Notes is 43.7694 shares of our common stock per $1,000 principal amount (actual $) of the 2022 Convertible Notes (equivalent to a conversion price of approximately $22.85 per common share — actual $). The conversion rate for the 2022 Convertible Notes is subject to adjustment in some events, but will not be adjusted for any accrued and unpaid interest. In addition, following certain events that occur prior to the maturity date, we will adjust the conversion rate for a holder who elects to convert its 2022 Convertible Notes in connection with such an event in certain circumstances. At any time prior to July 15, 2021, holders may convert the 2022 Convertible Notes at their option only under specific circumstances as defined in the indenture agreement, dated as of January 10, 2017, between us and our trustee, Wilmington Trust National Association (the “Convertible Notes Trustee”). On or after July 15, 2021 and until maturity, holders may convert all or any portion of the 2022 Convertible Notes at any time. Upon conversion, we will pay or deliver, as the case may be, cash, common stock, or a combination of cash and common stock, at our election. The “if-converted” value of the 2022 Convertible Notes exceeds the principal amount by $77.7 million as of September 30, 2020 as the closing market price of our common stock of $27.99 per common share (actual $) exceeds the implicit conversion price. For the three months ended September 30, 2020 and 2019, interest expense for the 2022 Convertible Notes, including non-cash amortization of discounts, was $4.3 million and $4.2 million, respectively. For the nine months ended September 30, 2020 and 2019, interest expense for the 2022 Convertible Notes, including non-cash amortization of discounts, was $12.9 million and $12.7 million, respectively.

General Terms

We may not redeem the 2022 Convertible Notes prior to their maturity date except to the extent necessary to preserve our status as a REIT for United States federal income tax purposes, as further described in the indenture. If we undergo a fundamental change as defined in the indenture, holders may require us to repurchase for cash all or any portion of their 2022 Convertible Notes at a fundamental change repurchase price equal to 100% of the principal amount of the 2022 Convertible Notes to be repurchased, plus accrued and unpaid interest up to, but excluding, the fundamental change repurchase date.

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The indenture contains customary terms and covenants and events of default. If an event of default occurs and is continuing, the Convertible Notes Trustee, by notice to us, or the holders of at least 25% in aggregate principal amount of the outstanding 2022 Convertible Notes, by notice to us and the Convertible Notes Trustee, may, and the Convertible Notes Trustee at the request of such holders shall, declare 100% of the principal of and accrued and unpaid interest on all the 2022 Convertible Notes to be due and payable. In the case of an event of default arising out of certain events of bankruptcy, insolvency or reorganization in respect to us (as set forth in the indenture), 100% of the principal of and accrued and unpaid interest on the 2022 Convertible Notes will automatically become due and payable.

Certain Hedging Arrangements

From time to time, we enter into derivative instruments to manage the economic risk of changes in interest rates. We do not enter into derivative transactions for speculative or trading purposes. Designated hedges are derivatives that meet the criteria for hedge accounting and that we have elected to designate as hedges. Non-designated hedges are derivatives that do not meet the criteria for hedge accounting or that we did not elect to designate as hedges.

Designated Hedges

We have entered into various interest rate swap agreements, which are used to hedge the variable cash flows associated with variable-rate interest payments. Currently, each of our swap agreements is indexed to LIBOR and is designated for hedge accounting purposes. LIBOR is set to expire at the end of 2021, and we will work with the counterparties to our swap agreements to adjust each floating rate to a comparable or successor rate. Changes in the fair value of these swaps are recorded in other comprehensive income and are subsequently reclassified into earnings in the period in which the hedged forecasted transactions affect earnings.

The table below summarizes our interest rate swap instruments as of September 30, 2020 ($ in thousands):

Agreement Date	Forward Effective Date	Maturity Date	Strike Rate	Index	Notional Amount
December 21, 2016	February 28, 2017	January 31, 2022	1.97%	One month LIBOR	$	750,000
December 11, 2019	February 28, 2017	December 31, 2024	1.74%	One month LIBOR	750,000
April 19, 2018	January 31, 2019	January 31, 2025	2.86%	One month LIBOR	400,000
February 15, 2019	March 15, 2019	March 15, 2022	2.23%	One month LIBOR	800,000
April 19, 2018	March 15, 2019	November 30, 2024	2.85%	One month LIBOR	400,000
April 19, 2018	March 15, 2019	February 28, 2025	2.86%	One month LIBOR	400,000
January 10, 2017	January 15, 2020	January 15, 2021	2.13%	One month LIBOR	550,000
May 8, 2018	March 9, 2020	June 9, 2025	2.99%	One month LIBOR	325,000
May 8, 2018	June 9, 2020	June 9, 2025	2.99%	One month LIBOR	595,000
June 3, 2016	July 15, 2020	July 15, 2021	1.47%	One month LIBOR	450,000
June 28, 2018	August 7, 2020	July 9, 2025	2.90%	One month LIBOR	1,100,000
January 10, 2017	January 15, 2021	July 15, 2021	2.23%	One month LIBOR	550,000
December 9, 2019	July 15, 2021	November 30, 2024	2.90%	One month LIBOR	400,000
November 7, 2018	March 15, 2022	July 31, 2025	3.14%	One month LIBOR	400,000
November 7, 2018	March 15, 2022	July 31, 2025	3.16%	One month LIBOR	400,000

During the three and nine months ended September 30, 2020 and 2019, such derivatives were used to hedge the variable cash flows associated with existing variable-rate interest payments. Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are made on our variable-rate debt. During the next 12 months, we estimate that $152.3 million will be reclassified to earnings as an increase in interest expense.

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Non-Designated Hedges

Concurrent with entering into certain of the mortgage loan agreements and in connection with previous mergers, we entered into or acquired and maintain interest rate cap agreements with terms and notional amounts equivalent to the terms and amounts of the mortgage loans made by the third party lenders. Currently, each of our cap agreements is indexed to LIBOR, which is set to expire at the end of 2021. We will work with the counterparties to our cap agreements to adjust each floating rate to a comparable or successor rate. To the extent that the maturity date of one or more of the mortgage loans is extended through an exercise of one or more extension options, replacement or extension interest rate cap agreements must be executed with terms similar to those associated with the initial interest rate cap agreements and strike prices equal to the greater of the interest rate cap strike price and the interest rate at which the debt service coverage ratio (as defined) is not less than 1.2 to 1.0. The interest rate cap agreements, including all of our rights to payments owed by the counterparties and all other rights, have been pledged as additional collateral for the mortgage loans. Additionally, in certain instances, in order to minimize the cash impact of purchasing required interest rate caps, we simultaneously sell interest rate caps (which have identical terms and notional amounts) such that the purchase price and sales proceeds of the related interest rate caps are intended to offset each other. The purchased and sold interest rate caps have strike prices ranging from approximately 3.75% to 5.31%.

Purchase of Outstanding Debt Securities or Loans

As market conditions warrant, we, our equity investors, our and their respective affiliates, and members of our management, may from time to time seek to purchase our outstanding debt, including borrowings under our credit facilities and mortgage loans or debt securities that we may issue in the future, in privately negotiated or open market transactions, by tender offer or otherwise. Subject to any applicable limitations contained in the agreements governing our indebtedness, any purchases made by us may be funded by the use of cash on our condensed consolidated balance sheet or the incurrence of new secured or unsecured debt, including borrowings under our credit facility and mortgage loans. The amounts involved in any such purchase transactions, individually or in the aggregate, may be material. Any such purchases may be with respect to a substantial amount of a particular class or series of debt, with the attendant reduction in the trading liquidity of such class or series. In addition, any such purchases made at prices below the “adjusted issue price” (as defined for United States federal income tax purposes) may result in taxable cancellation of indebtedness income to us, which amounts may be material, and in related adverse tax consequences to us.

Cash Flows

Nine Months Ended September 30, 2020 Compared to Nine Months Ended September 30, 2019

The following table summarizes our cash flows for the nine months ended September 30, 2020 and 2019:

	For the Nine Months Ended September 30,
($ in thousands)	2020		2019		$ Change		% Change
Net cash provided by operating activities	$	625,672	$	590,848	$	34,824	5.9	%
Net cash used in investing activities	(194,375)		(26,571)		(167,804)		(631.5)	%
Net cash provided by (used in) financing activities	91,366		(597,855)		689,221		115.3	%
Change in cash, cash equivalents, and restricted cash	$	522,663	$	(33,578)	$	556,241	N/M

Operating Activities

Our cash flows provided by operating activities depend on numerous factors, including the occupancy level of our homes, the rental rates achieved on our leases, the collection of rent from our residents, and the amount of our operating and other expenses. Net cash provided by operating activities was $625.7 million and $590.8 million for the nine months ended September 30, 2020 and 2019, respectively, an increase of 5.9%. The increase in cash provided by operating activities was driven by improved operational profitability, which was partially offset by changes in operating assets and liabilities.

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Investing Activities

Net cash used in investing activities consists primarily of the acquisition costs of homes, capital improvements, and proceeds from property sales. Net cash used in investing activities was $194.4 million and $26.6 million for the nine months ended September 30, 2020 and 2019, respectively, an increase of $167.8 million. The increase in net cash used in investing activities primarily resulted from the combined effect of the following changes in cash flows during the nine months ended September 30, 2020 compared to the nine months ended September 30, 2019: (1) a decrease in proceeds from the sale of homes; (2) an increase in cash used for the initial renovation of homes; (3) a decrease in cash provided by repayment proceeds from retained debt securities; all offset by (4) a decrease in cash used for the acquisition of homes. More specifically, proceeds from sales of homes decreased $154.7 million from the nine months ended September 30, 2019 to the nine months ended September 30, 2020 due to a significant decrease in the number of homes sold from 2,101 to 1,303, respectively, partially offset by an increase in proceeds per home. Initial renovation spend increased $36.6 million from the nine months ended September 30, 2019 compared to the nine months ended September 30, 2020 due to a significant increase in the number of homes undergoing their initial renovation and an increase in the cost per home. Proceeds from repayment of retained debt securities decreased $31.9 million from the nine months ended September 30, 2019 to the nine months ended September 30, 2020 due to a decrease in prepayments of mortgage loans. Acquisition spend decreased $67.7 million due to a significant decrease in the number of homes acquired from 1,526 homes during the nine months ended September 30, 2019 to 1,195 homes during the nine months ended September 30, 2020.

Financing Activities

Net cash provided by (used in) financing activities was $91.4 million and $(597.9) million for the nine months ended September 30, 2020 and 2019, respectively. During the nine months ended September 30, 2020, issuances and sales of stock under our public offering and ATM Equity Program resulted in $503.8 million of proceeds, and we repaid $157.8 million of our mortgage loans, including partial repayments of IH 2018-2 and IH 2018-3, and funded $249.3 million of dividend and distribution payments. For the nine months ended September 30, 2019, proceeds from our Secured Term Loan of $403.5 million, along with proceeds from home sales and operating cash flows were used to repay $798.4 million of our mortgage loans, including full repayment of CSH 2016-2 and partial repayments of IH 2017-2 and IH 2018-1, and for dividend and distribution payments which totaled $209.4 million.

Off-Balance Sheet Arrangements

We have no material off-balance sheet arrangements as defined in Item 303(a)(4) of Regulation S-K.

Contractual Obligations

Our contractual obligations as of September 30, 2020, consist of the following:

($ in thousands)	Total		2020(1)		2021-2022		2023-2024		Thereafter
Mortgage loans, net(2)(3)	$	6,727,116	$	29,943	$	238,281	$	1,559,499	$	4,899,393
Secured Term Loan(2)	558,043		3,618		28,944		28,944		496,537
Term Loan Facility, net(2)	1,538,080		7,092		1,530,988		—		—
Revolving Facility(2)(3)(4)	4,802		894		3,908		—		—
2022 Convertible Notes(5)	363,113		—		363,113		—		—
Derivative instruments(6)	640,764		37,784		284,751		273,810		44,419
Purchase commitments(7)	184,860		177,002		7,858		—		—
Operating leases	16,359		1,219		8,686		5,358		1,096
Finance leases	9,616		792		5,635		3,189		—
Total	$	10,042,753	$	258,344	$	2,472,164	$	1,870,800	$	5,441,445

(1)Includes estimated payments for the remaining three months of 2020.

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(2)Includes estimated interest payments on the respective debt based on amounts outstanding as of September 30, 2020 at rates in effect as of such date; as of September 30, 2020, LIBOR was 0.15%.

(3)Represents the maturity date if we exercise each of the remaining one year extension options available, which are subject to certain conditions being met. See Part I. Item 1. “Financial Statements — Note 6 of Notes to Condensed Consolidated Financial Statements” for a description of maturity dates without consideration of extension options.

(4)Includes the related unused commitment fee.

(5)Represents the principal amount and interest obligation of the 2022 Convertible Notes which is calculated using the notes’ coupon rate.

(6)Includes interest rate swap and interest rate cap obligations calculated using LIBOR as of September 30, 2020, or 0.15%.

(7)Represents commitments to acquire 738 single-family rental homes, of which 327 are part of bulk acquisitions, as of September 30, 2020.

Critical Accounting Policies and Estimates

Critical accounting policies are those accounting policies that management believes are important to the portrayal of our financial condition and results and require management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. We believe that our critical accounting policies pertain to the following: (i) our investments in single-family residential properties, including acquisition of real estate assets, related cost capitalization, provisions for impairment, and single-family residential properties held for sale; and (ii) derivative financial instruments. These critical policies and estimates are summarized in Part II. Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K. There were no material changes to our critical accounting policies during the nine months ended September 30, 2020.

For a discussion of recently adopted accounting standards, see Part I. Item 1. “Financial Statements — Note 2 of Notes to Condensed Consolidated Financial Statements.”

Segment Reporting

Operating segments are defined as components of an enterprise for which discrete financial information is available that is evaluated regularly by the CODM in deciding how to allocate resources and in assessing performance. Our CODM is the Chief Executive Officer.

Under the provision of ASC 280, Segment Reporting, we have determined that we have one reportable segment related to acquiring, renovating, leasing, and operating single-family homes as rental properties. The CODM evaluates operating performance and allocates resources on a total portfolio basis. The CODM utilizes NOI as the primary measure to evaluate performance of the total portfolio. The aggregation of individual homes constitutes the total portfolio. Decisions regarding acquisitions and dispositions of homes are made at the individual home level with a focus on growing accretively in high-growth locations where we have greater scale and density.

Non-GAAP Measures

EBITDA, EBITDAre, and Adjusted EBITDAre

EBITDA, EBITDAre, and Adjusted EBITDAre are supplemental, non-GAAP measures often utilized to evaluate the performance of real estate companies. We define EBITDA as net income or loss computed in accordance with GAAP before the following items: interest expense; income tax expense; and depreciation and amortization. The National Association of Real Estate Investment Trusts (“Nareit”) recommends as a best practice that REITs that report an EBITDA performance measure also report EBITDAre. We define EBITDAre, consistent with the Nareit definition, as EBITDA, further adjusted for gain on sale of property, net of tax and impairment on depreciated real estate investments.

Adjusted EBITDAre is defined as EBITDAre before the following items: share-based compensation expense; merger and transaction-related expenses; severance; casualty losses, net; and other income and expenses. EBITDA, EBITDAre, and Adjusted EBITDAre are used as supplemental financial performance measures by management and by external users of our financial statements, such as investors and commercial banks. Set forth below is additional detail on how management uses EBITDA, EBITDAre, and Adjusted EBITDAre as measures of performance.

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Our management uses EBITDA, EBITDAre, and Adjusted EBITDAre in a number of ways to assess our condensed consolidated financial and operating performance, and we believe these measures are helpful to management and external users in identifying trends in our performance. EBITDA, EBITDAre, and Adjusted EBITDAre help management identify controllable expenses and make decisions designed to help us meet our current financial goals and optimize our financial performance, while neutralizing the impact of capital structure on results. Accordingly, we believe these metrics measure our financial performance based on operational factors that management can impact in the short-term, namely our cost structure and expenses.

We believe that the presentation of EBITDA, EBITDAre, and Adjusted EBITDAre provides information useful to investors in assessing our financial condition and results of operations. The GAAP measure most directly comparable to EBITDA, EBITDAre, and Adjusted EBITDAre is net income or loss. EBITDA, EBITDAre, and Adjusted EBITDAre are not used as measures of our liquidity and should not be considered alternatives to net income or loss or any other measure of financial performance presented in accordance with GAAP. Our EBITDA, EBITDAre, and Adjusted EBITDAre may not be comparable to the EBITDA, EBITDAre, and Adjusted EBITDAre of other companies due to the fact that not all companies use the same definitions of EBITDA, EBITDAre, and Adjusted EBITDAre. Accordingly, there can be no assurance that our basis for computing these non-GAAP measures is comparable with that of other companies.

The following table presents a reconciliation of net income (as determined in accordance with GAAP) to EBITDA, EBITDAre, and Adjusted EBITDAre for each of the periods indicated:

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
($ in thousands)	2020		2019		2020		2019
Net income available to common stockholders	$	32,540	$	33,616	$	125,178	$	93,165
Net income available to participating securities	114		91		335		306
Non-controlling interests	211		276		806		1,086
Interest expense	87,713		89,067		258,541		278,756
Depreciation and amortization	138,147		133,315		410,440		399,955
EBITDA	258,725		256,365		795,300		773,268
Gain on sale of property, net of tax	(15,106)		(20,812)		(41,473)		(64,556)
Impairment on depreciated real estate investments	289		3,960		4,202		11,289
EBITDAre	243,908		239,513		758,029		720,001
Share-based compensation expense(1)	6,086		4,625		12,293		13,847
Merger and transaction-related expenses(2)	—		—		—		4,347
Severance	133		881		388		8,225
Casualty losses, net	1,434		780		468		514
Other, net(3)	3,049		(4,735)		(2,035)		(8,470)
Adjusted EBITDAre	$	254,610	$	241,064	$	769,143	$	738,464

(1)For the three months ended September 30, 2020 and 2019, $1,253 and $807 was recorded in property management expense, respectively, and $4,833 and $3,818 was recorded in general and administrative expense, respectively. For the nine months ended September 30, 2020 and 2019, $2,533 and $2,314 was recorded in property management expense, respectively, and $9,760 and $11,533 was recorded in general and administrative expense, respectively.

(2)Includes merger and transaction-related expenses included within general and administrative.

(3)Includes interest income, unrealized gains from investments in equity securities, and other miscellaneous income and expenses.

Net Operating Income

NOI is a non-GAAP measure often used to evaluate the performance of real estate companies. We define NOI for an identified population of homes as rental revenues and other property income less property operating and maintenance expense

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(which consists primarily of property taxes, insurance, HOA fees (when applicable), market-level personnel expenses, repairs and maintenance, leasing costs, and marketing expense). NOI excludes: interest expense; depreciation and amortization; property management expense; general and administrative expense; impairment and other; gain on sale of property, net of tax; and other income and expenses.

We consider NOI to be a meaningful supplemental financial measure of our performance when considered with the financial statements determined in accordance with GAAP. We believe NOI is helpful to investors in understanding the core performance of our real estate operations. The GAAP measure most directly comparable to NOI is net income or loss. NOI is not used as a measure of liquidity and should not be considered as an alternative to net income or loss or any other measure of financial performance presented in accordance with GAAP. Our NOI may not be comparable to the NOI of other companies due to the fact that not all companies use the same definition of NOI. Accordingly, there can be no assurance that our basis for computing this non-GAAP measure is comparable with that of other companies.

We believe that Same Store NOI is also a meaningful supplemental measure of our operating performance for the same reasons as NOI and is further helpful to investors as it provides a more consistent measurement of our performance across reporting periods by reflecting NOI for homes in our Same Store portfolio.

The following table presents a reconciliation of net income (as determined in accordance with GAAP) to NOI for our total portfolio and NOI for our Same Store portfolio for each of the periods indicated:

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
($ in thousands)	2020		2019		2020		2019
Net income available to common stockholders	$	32,540	$	33,616	$	125,178	$	93,165
Net income available to participating securities	114		91		335		306
Non-controlling interests	211		276		806		1,086
Interest expense	87,713		89,067		258,541		278,756
Depreciation and amortization	138,147		133,315		410,440		399,955
Property management expense(1)	14,824		15,872		43,725		47,053
General and administrative(2)	17,972		16,405		46,626		58,899
Impairment and other	1,723		4,740		4,670		11,803
Gain on sale of property, net of tax	(15,106)		(20,812)		(41,473)		(64,556)
Other, net(3)	3,049		(4,735)		(2,035)		(8,470)
NOI (total portfolio)	281,187		267,835		846,813		817,997
Non-Same Store NOI	(24,892)		(20,348)		(66,739)		(63,241)
NOI (Same Store portfolio)(4)	$	256,295	$	247,487	$	780,074	$	754,756

(1)Includes $1,253 and $807 of share-based compensation expense for the three months ended September 30, 2020 and 2019, respectively. Includes $2,533 and $2,314 of share-based compensation expense for the nine months ended September 30, 2020 and 2019, respectively.

(2)Includes $4,833 and $3,818 of share-based compensation expense for the three months ended September 30, 2020 and 2019, respectively. Includes $9,760 and $11,533 of share-based compensation expense for the nine months ended September 30, 2020 and 2019, respectively.

(3)Includes interest income, unrealized gains from investments in equity securities, and other miscellaneous income and expenses.

(4)The Same Store portfolio totaled 71,810 homes for the nine months ended September 30, 2020 and 2019.

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Funds from Operations, Core Funds from Operations, and Adjusted Funds from Operations

Funds From Operations (“FFO”), Core FFO, and Adjusted FFO are supplemental, non-GAAP measures often utilized to evaluate the performance of real estate companies. FFO is defined by Nareit as net income or loss (computed in accordance with GAAP) excluding gains or losses from sales of previously depreciated real estate assets, plus depreciation, amortization and impairment of real estate assets, and adjustments for unconsolidated partnerships and joint ventures.

We believe that FFO is a meaningful supplemental measure of the operating performance of our business because historical cost accounting for real estate assets in accordance with GAAP assumes that the value of real estate assets diminishes predictably over time, as reflected through depreciation and amortization. Because real estate values have historically risen or fallen with market conditions, management considers FFO an appropriate supplemental performance measure as it excludes historical cost depreciation and amortization, impairment on depreciated real estate investments, gains or losses related to sales of previously depreciated homes, as well non-controlling interests, from net income or loss (computed in accordance with GAAP). By excluding depreciation and amortization and gains or losses on sales of real estate, management uses FFO to measure returns on its investments in homes. However, because FFO excludes depreciation and amortization and captures neither the changes in the value of the homes that result from use or market conditions nor the level of capital expenditures to maintain the operating performance of the homes, all of which have real economic effect and could materially affect our results from operations, the utility of FFO as a measure of our performance is limited.

Management also believes that FFO, combined with the required GAAP presentations, is useful to investors in providing more meaningful comparisons of the operating performance of a company’s real estate between periods or as compared to other companies. The GAAP measure most directly comparable to FFO is net income or loss. FFO is not used as a measure of our liquidity and should not be considered an alternative to net income or loss or any other measure of financial performance presented in accordance with GAAP. Our FFO may not be comparable to the FFO of other companies due to the fact that not all companies use the same definition of FFO. Accordingly, there can be no assurance that our basis for computing this non-GAAP measures is comparable with that of other companies.

We believe that Core FFO and Adjusted FFO are also meaningful supplemental measures of our operating performance for the same reasons as FFO and are further helpful to investors as they provide a more consistent measurement of our performance across reporting periods by removing the impact of certain items that are not comparable from period to period. We define Core FFO as FFO adjusted for the following: non-cash interest expense related to amortization of deferred financing costs, loan discounts, and non-cash interest expense from derivatives; share-based compensation expense; offering related expenses; merger and transaction-related expenses; severance expense; unrealized gains on investments in equity securities; and casualty losses, net, as applicable. We define Adjusted FFO as Core FFO less recurring capital expenditures that are necessary to help preserve the value, and maintain the functionality, of our homes. The GAAP measure most directly comparable to Core FFO and Adjusted FFO is net income or loss. Core FFO and Adjusted FFO are not used as measures of our liquidity and should not be considered alternatives to net income or loss or any other measure of financial performance presented in accordance with GAAP. Our Core FFO and Adjusted FFO may not be comparable to the Core FFO and Adjusted FFO of other companies due to the fact that not all companies use the same definition of Core FFO and Adjusted FFO. No adjustments were made to the Core FFO and Adjusted FFO per common share — diluted computations for potential shares of common stock related to the Convertible Senior Notes. Accordingly, there can be no assurance that our basis for computing this non-GAAP measures is comparable with that of other companies.

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The following table presents a reconciliation of net income (as determined in accordance with GAAP) to FFO, Core FFO, and Adjusted FFO for each of the periods indicated:

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(in thousands, except shares and per share data)	2020		2019		2020		2019
Net income available to common stockholders	$	32,540	$	33,616	$	125,178	$	93,165
Add (deduct) adjustments from net income to derive FFO:
Net income available to participating securities	114		91		335		306
Non-controlling interests	211		276		806		1,086
Depreciation and amortization on real estate assets	136,517		132,266		406,078		396,568
Impairment on depreciated real estate investments	289		3,960		4,202		11,289
Net gain on sale of previously depreciated investments in real estate	(15,106)		(20,812)		(41,473)		(64,556)
FFO	154,565		149,397		495,126		437,858
Non-cash interest expense related to amortization of deferred financing costs, loan discounts, and non-cash interest expense from derivatives	6,883		10,385		26,640		37,422
Share-based compensation expense(1)	6,086		4,625		12,293		13,847
Offering related expenses(2)	—		129		—		2,148
Merger and transaction-related expenses(3)	—		—		—		4,347
Severance expense	133		881		388		8,225
Unrealized gains on investments in equity securities(4)	—		(6,480)		(34)		(6,480)
Casualty losses, net	1,434		780		468		514
Core FFO	169,101		159,717		534,881		497,881
Recurring capital expenditures	(33,861)		(36,653)		(87,466)		(93,563)
Adjusted FFO	$	135,240	$	123,064	$	447,415	$	404,318
Net income available to common stockholders
Weighted average common shares outstanding — diluted(5)(6)(7)	561,871,373		538,644,888		551,947,278		529,160,353
Net income per common share — diluted(5)(6)(7)	$	0.06	$	0.06	$	0.23	$	0.18
FFO
Numerator for FFO per common share — diluted(5)	$	154,565	$	149,397	$	507,995	$	443,444
Weighted average common shares and OP Units outstanding — diluted(4)(5)(6)	565,655,768		544,481,679		570,851,976		544,506,626
FFO per common share — diluted(5)(6)(7)	$	0.27	$	0.27	$	0.89	$	0.81
Core FFO and Adjusted FFO
Weighted average common shares and OP Units outstanding — diluted(5)(6)(7)	565,655,768		544,481,679		555,751,533		536,183,368
Core FFO per common share — diluted(5)(6)(7)	$	0.30	$	0.29	$	0.96	$	0.93
AFFO per common share — diluted(5)(6)(7)	$	0.24	$	0.23	$	0.81	$	0.75

(1)For the three months ended September 30, 2020 and 2019, $1,253 and $807 was recorded in property management expense, respectively, and $4,833 and $3,818 was recorded in general and administrative expense, respectively. For the nine months ended September 30, 2020 and 2019, $2,533 and $2,314 was recorded in property management expense, respectively, and $9,760 and $11,533 was recorded in general and administrative expense, respectively.

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(2)Includes expenses associated with secondary offerings of common stock completed during the three and nine months ended September 30, 2019 included within other, net.

(3)Includes merger and transaction-related expenses included within general and administrative.

(4)Includes unrealized gains on our investments in equity securities during the nine months ended September 30, 2020 and the three and nine months ended September 30, 2019, included within other, net. No unrealized gains or losses were recorded during the three months ended September 30, 2020.

(5)On July 1, 2019, we settled the full outstanding balance of the 2019 Convertible Notes with the issuance of 12,553,864 shares of common stock, and these shares of common stock are included within all net income, FFO, Core FFO, and AFFO per common share calculations subsequent to that date. Using the “if-converted” method, in the period prior to conversion for the nine months ended September 30, 2019, the 2019 Convertible Notes are excluded from net income per common share — diluted as they are anti-dilutive, and are reflected in the FFO per common share — diluted computation above, consistent with Nareit’s guidance for calculating FFO per share. For the nine months ended September 30, 2019, the numerator for FFO per common share — diluted is adjusted for $5,586 of interest expense on the 2019 Convertible Notes, including non-cash amortization of discounts. For the nine months ended September 30, 2019, the denominator is adjusted for 8,323,258 potential shares of common stock for the 2019 Convertible Notes for the period prior to conversion. No such adjustments were made to Core FFO and AFFO per common share — diluted.

With respect to the 2022 Convertible Notes, for the nine months ended September 30, 2020, the numerator for FFO per common share — diluted is adjusted for $12,869 of interest expense, including non-cash amortization of discounts, and the denominator is adjusted for 15,100,443 potential shares of common stock issuable upon the conversion of the 2022 Convertible Notes. Additionally, no such adjustments were made to Core FFO and AFFO per common share —diluted. For the three and nine months ended September 30, 2019 and the three months ended September 30, 2020, 15,100,443 potential shares of common stock issuable upon the conversion of the 2022 Convertible Notes are excluded from the computation of net income or loss and FFO per common share — diluted as they are anti-dilutive, and are excluded from Core FFO and AFFO per common share — diluted.

(6)Incremental shares attributed to non-vested share-based awards totaling 1,272,378 and 873,643 shares for the three months ended September 30, 2020 and 2019, respectively, and 1,224,594 and 951,320 for the nine months ended September 30, 2020 and 2019, respectively, are included in the denominator for net income per common share — diluted. For the computations of FFO, Core FFO, and AFFO per common share — diluted, common share equivalents of 1,593,488 and 1,247,149 for the three months ended September 30, 2020 and 2019, respectively, and 1,565,564 and 1,447,764 for the nine months ended September 30, 2020 and 2019, respectively, related to incremental shares attributed to non-vested share-based awards are included in the denominator.

(7)Vested units of partnership interests in INVH LP (“OP Units”) have been excluded from the computation of net income per common share — diluted for the periods above because all net income attributable to the vested OP Units has been recorded as non-controlling interest and thus excluded from net income available to common stockholders. Weighted average vested OP Units of 3,463,285 and 5,463,285 for the three months ended September 30, 2020 and 2019, respectively, and 3,463,285 and 6,526,571 for the nine months ended September 30, 2020 and 2019, respectively, are included in the denominator for the computations of FFO, Core FFO, and AFFO per common share — diluted.

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Our future income, cash flows, and fair values relevant to financial instruments are dependent upon prevalent market interest rates. Market risk refers to the risk of loss from adverse changes in interest rates, seasonality, market prices, commodity prices, and inflation. The primary market risks to which we are exposed are interest rate risk and seasonality. We may in the future use derivative financial instruments to manage, or hedge, interest rate risks related to any borrowings we may have. We may enter into such contracts only with major financial institutions based on their credit ratings and other factors.

Interest Rate Risk

A primary market risk to which we believe we are exposed is interest rate risk, which may result from many factors, including government monetary and tax policies, domestic and international economic and political considerations, and other factors that are beyond our control. We may incur additional variable rate debt in the future, including additional amounts that we may borrow under the Credit Facility. In addition, decreases in interest rates may lead to additional competition for the acquisition of single-family homes, which may lead to future acquisitions being more costly and resulting in lower yields on single-family homes targeted for acquisition. Significant increases in interest rates may also have an adverse impact on our earnings if we are unable to increase rents on expired leases or acquire single-family homes with rental rates high enough to offset the increase in interest rates on our borrowings.

As of September 30, 2020, our outstanding variable-rate debt was comprised of borrowings on our mortgage loans of $5,114.2 million and Term Loan Facility of $1,500.0 million for a combined total of $6,614.2 million. We effectively converted 98.6% of these borrowings to a fixed rate through interest rate swap agreements. Additionally, all borrowings bear interest at LIBOR plus the applicable spread. Assuming no change in the outstanding balance of our existing debt, the projected effect of a 100 bps increase or decrease in LIBOR on our annual interest expense would be an estimated increase of $0.9 million or $11.8 million, respectively. This estimate considers the impact of our interest rate swap agreements, interest rate cap agreements, and any LIBOR floors or minimum interest rates stated in the agreements of the respective borrowings.

This analysis does not consider the effects of the reduced level of overall economic activity that could exist in such an environment. Further, in the event of a change of such magnitude, we may consider taking actions to further mitigate our exposure to the change. However, because of the uncertainty of the specific actions that would be taken and their possible effects, the sensitivity analysis assumes no changes in our capital structure.

Seasonality

Our business and related operating results have been, and we believe that they will continue to be, impacted by seasonal factors throughout the year. In particular, we have experienced higher levels of resident move-outs during the summer months, which impacts both our rental revenues and related turnover costs. Further, our property operating costs are seasonally impacted in certain markets by increases in expenses such as HVAC repairs, costs to re-resident, and landscaping expenses during the summer season.

ITEM 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

We maintain a set of disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) designed to ensure that information required to be disclosed in reports we file or submit under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures. The design of any disclosure controls and procedures is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its goals under all potential future conditions. Any controls and procedures, no matter how well designed and operated, can provide only reasonable, not absolute, assurance of achieving the desired control objectives. Our management, with the participation of our Chief Executive Officer and Chief Financial

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Officer, has evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of September 30, 2020. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of September 30, 2020, the design and operation of our disclosure controls and procedures were effective to accomplish their objectives at the reasonable assurance level.

Changes in Internal Control

There has been no change in our internal control over financial reporting during our most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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PART II

ITEM 1. LEGAL PROCEEDINGS

The Company currently is not subject to any material litigation nor, to management’s knowledge, is any material litigation currently threatened against the Company other than routine litigation and administrative proceedings arising in the ordinary course of business.

ITEM 1A. RISK FACTORS

For a discussion of our potential risks or uncertainties, you should carefully read and consider risk factors previously disclosed under Part I. Item 1A. “Risk Factors” of our Annual Report on Form 10-K. There have been no material changes from the risk factors previously disclosed except for the risk factors listed below. Additional risks not presently known to us or that we currently deem immaterial may also impair our business operations. Moreover, many risk factors set forth in the Annual Report on Form 10-K have been heightened as a result of the impact of the COVID-19 pandemic.

Our business, results of operations, financial condition, and cash flows may be adversely affected by pandemic infectious diseases, particularly the ongoing COVID-19 pandemic.

Pandemic infectious diseases, such as the current COVID-19 strain, may adversely impact our business, results of operations, financial condition, and cash flows. The ongoing COVID-19 outbreak in the United States has led entities directed by, or notionally affiliated with, the Federal government as well as certain states and cities, including those in which we own properties and where our principal places of business are located, to impose and continue to implement measures intended to control the spread of COVID-19, including instituting quarantines, restrictions on travel, “shelter in place” rules, and restrictions on types of business that may continue to operate. We depend on rental revenues and other property income from residents for substantially all of our revenues. The COVID-19 outbreak, as well as continuing measures taken by governmental authorities and private actors to limit the spread of this virus or mitigate its impact, is interfering with the ability of some of our residents to meet their lease obligations and make their rent payments on time or at all. In addition, entities directed by, or notionally affiliated with, the Federal government as well as some jurisdictions across the United States have imposed temporary eviction moratoriums and are allowing residents to defer missed rent payments without incurring late fees, and jurisdictions and other local and national authorities may expand or extend measures imposing restrictions on our ability to enforce residents’ contractual rental obligations and limiting our ability to increase rents. While such measures are likely to enable residents to stay in their homes despite an inability to pay because of financial or other hardship stemming from the pandemic, they are likely to continue to result in loss of rental income and other property income. We may not be able to promptly re-lease properties that are vacant or become vacant because residents decide not to renew their leases or for other reasons, and the rental rates or other terms under new leases may be less favorable than the terms of the current leases. We cannot predict if states, municipalities, local, and/or national authorities will expand existing restrictions, if additional states or municipalities will implement similar restrictions, or when restrictions currently in place will expire.

Additionally, COVID-19 and related containment measures may also continue to interfere with the ability of our associates, suppliers, and other business partners to carry out their assigned tasks or supply materials, services, or funding (in the case of our Revolving Facility) at ordinary levels of performance relative to the conduct of our business.

Business continuity and disaster recovery issues which may result from the current COVID-19 pandemic or any future pandemic could materially interrupt our business operations. In accordance with phased re-opening guidelines and the ongoing spread of COVID-19 cases in certain states where we operate, the majority of our associates based at our headquarters and local offices continue working remotely. An extended period of remote work arrangements could strain our business continuity plans, introduce operational risk, including, but not limited to cybersecurity risks, and impair our ability to manage our business.

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A significant outbreak of pandemic infectious diseases in the human population may result, and the COVID-19 pandemic has resulted, in a widespread health crisis adversely affecting the economies and financial markets of many countries, resulting in an economic downturn that could negatively affect our business, results of operations, and financial condition.

The COVID-19 pandemic, or a future pandemic, could also have material and adverse effects on our ability to successfully operate our business and on our financial condition, results of operations and cash flows due to, among other factors:

•demand for single-family rental properties decreasing substantially and/or occupancy decreasing materially;

•inability by our residents to meet their lease obligations has reduced and may continue to reduce our cash flows, and the resulting impact on rental and other property income could impact our ability to make all required debt service payments and to continue paying dividends to our stockholders at expected levels or at all. For example, our securitized financings require that monthly cash collections from their respective property collateral pools be controlled by the servicer until monthly debt service payments and property management fees are paid and escrow reserves are funded. So long as we remain in compliance with certain covenants contained in the underlying loan agreements, after such monthly payments are made the servicer releases all residual net cash flow to us. This residual net cash flow represents a material portion of our cash flows. If the property collateral pools experience higher rates of resident defaults or delinquencies these covenants may not be achieved. This would result in the servicer holding all residual net cash flow from any collateral pool that does not meet the covenant requirements, net of a monthly funding to us for budgeted operating expenses, in blocked collateral accounts for the benefit of the securitized lender rather than being made available to us. Our lack of access to the net cash flow from securitized collateral pools could have a material adverse effect on our business, results of operations and financial condition;

•a general decline in business activity and demand for real estate transactions could adversely affect (1) our ability to acquire or dispose of single-family homes on terms that are attractive or at all and (2) the value of our homes and our business such that we may recognize impairment on the carrying value of our investments in single-family residential properties and other assets subject to impairment review, including, but not limited to, goodwill;

•difficulty accessing debt and equity capital on attractive terms, or at all, impacts to our credit ratings, and a severe disruption of, and/or instability in, the global financial markets or deteriorations in credit and financing conditions may affect our access to capital necessary to fund business operations, including acquisitions, or address maturing liabilities on a timely basis;

•the financial impact of the COVID-19 pandemic could negatively impact our future compliance with financial covenants of our Credit Facility and other debt agreements and result in a default and potentially an acceleration of indebtedness, which non-compliance could negatively impact our ability to make additional borrowings under our Revolving Facility or to exercise extension options on our mortgage loans and the Revolving Facility;

•a deterioration in our ability to operate in affected areas or delays in the supply of products or services by vendors that are needed for our efficient operations; and

•the potential negative consequences for the health of our associates, particularly if a significant number of them are impacted, could result in a deterioration in our ability to ensure business continuity during this disruption.

The extent to which the COVID-19 pandemic ultimately impacts our operations depends on ongoing developments, which remain highly uncertain and cannot be predicted with confidence, including the scope, severity, and duration of the pandemic, the extent and duration of actions taken to contain the pandemic or mitigate its impact, and the direct and indirect economic effects of the pandemic, containment measures, monetary and/or fiscal policies implemented to provide support or relief to businesses and/or residents, and other government, regulatory, and/or legislative changes precipitated by the COVID-19 pandemic, among others.

The ongoing development and fluidity of this situation precludes any prediction as to the full adverse impact of the COVID-19 pandemic. Nevertheless, the COVID-19 pandemic presents material uncertainty and risk with respect to our financial condition, results of operations, cash flows and performance. While we have taken steps to mitigate the impact of the pandemic on our results of operations, there can be no assurance that these efforts will be successful.

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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

None.

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ITEM 6. EXHIBITS

Exhibit number	Description
3.1	Charter of Invitation Homes Inc., dated as of February 6, 2017 (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K (File No. 1-38004) filed on February 6, 2017).
3.2	Amended and Restated Bylaws of Invitation Homes Inc., dated as of February 6, 2017 (incorporated by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K (File No. 1-38004) filed on February 6, 2017).
31.1	Certificate of Dallas B. Tanner, President and Chief Executive Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certificate of Ernest M. Freedman, Executive Vice President and Chief Financial Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certificate of Dallas B. Tanner, President and Chief Executive Officer, pursuant to Section 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith).
32.2	Certificate of Ernest M. Freedman, Executive Vice President and Chief Financial Officer, pursuant to Section 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith).
101.INS	Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH	Inline XBRL Taxonomy Extension Schema Document.
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104	Cover page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Invitation Homes Inc.
By:	/s/ Ernest M. Freedman
	Name: Ernest M. Freedman
	Title: Executive Vice President and Chief Financial Officer
	(Principal Financial Officer)
	Date: October 29, 2020
By:	/s/ Kimberly K. Norrell
	Name: Kimberly K. Norrell
	Title: Executive Vice President and Chief Accounting Officer
	(Principal Accounting Officer)
	Date: October 29, 2020

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EX-31.1

Exhibit 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

I, Dallas B. Tanner, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Invitation Homes Inc. for the quarterly period ended September 30, 2020;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

By:	/s/ Dallas B. Tanner
	Dallas B. Tanner
	President and Chief Executive Officer
	(Principal Executive Officer)
	October 29, 2020

EX-31.2

Exhibit 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

I, Ernest M. Freedman, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Invitation Homes Inc. for the quarterly period ended September 30, 2020;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

By:	/s/ Ernest M. Freedman
	Ernest M. Freedman
	Chief Financial Officer
	(Principal Financial Officer)
	October 29, 2020

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY

ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Invitation Homes Inc. (the “Company”) for the quarterly period ended September 30, 2020 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Dallas B. Tanner, President and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1.The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

By:	/s/ Dallas B. Tanner
	Dallas B. Tanner
	President and Chief Executive Officer
	(Principal Executive Officer)
	October 29, 2020

A signed original of this certification required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request. The foregoing certification is being furnished solely pursuant to 18 U.S.C. Section 1350 and is not being filed as part of the Report or as a separate disclosure document.

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY

ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Invitation Homes Inc. (the “Company”) for the quarterly period ended September 30, 2020 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Ernest M. Freedman, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1.The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

By:	/s/ Ernest M. Freedman
	Ernest M. Freedman
	Chief Financial Officer
	(Principal Financial Officer)
	October 29, 2020

A signed original of this certification required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request. The foregoing certification is being furnished solely pursuant to 18 U.S.C. Section 1350 and is not being filed as part of the Report or as a separate disclosure document.

XML

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2020	Oct. 26, 2020
Document and Entity Information [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2020
Document Transition Report	false
Entity File Number	001-38004
Entity Registrant Name	Invitation Homes Inc.
Entity Central Index Key	0001687229
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2020
Document Fiscal Period focus	Q3
Amendment Flag	false
Entity Incorporation, State or Country Code	MD
Entity Tax Identification Number	90-0939055
Entity Address, Address Line One	1717 Main Street,
Entity Address, Address Line Two	Suite 2000
Entity Address, City or Town	Dallas,
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	75201
City Area Code	(972)
Local Phone Number	421-3600
Title of 12(b) Security	Common stock, $0.01 par value
Trading Symbol	INVH
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Stock Outstanding (in shares)		560,534,032

XML

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Investments in single-family residential properties:
Land	$ 4,501,831	$ 4,499,346
Building and improvements	14,011,329	13,747,818
Total gross investments in the properties	18,513,160	18,247,164
Less: accumulated depreciation	(2,381,059)	(2,003,972)
Investments in single-family residential properties, net	16,132,101	16,243,192
Cash and cash equivalents	559,567	92,258
Restricted cash	249,341	193,987
Goodwill	258,207	258,207
Other assets, net	551,571	605,266
Total assets	17,750,787	17,392,910
Liabilities:
Mortgage loans, net	6,094,980	6,238,461
Secured term loan, net	401,040	400,978
Term loan facility, net	1,495,913	1,493,747
Revolving facility	0	0
Convertible senior notes, net	338,112	334,299
Accounts payable and accrued expenses	261,355	186,110
Resident security deposits	155,871	147,787
Other liabilities	672,139	325,450
Total liabilities	9,419,410	9,126,832
Commitments and contingencies (Note 14)
Stockholders' equity
Preferred stock, $0.01 par value per share, 900,000,000 shares authorized, none outstanding as of September 30, 2020 and December 31, 2019	0	0
Common stock, $0.01 par value per share, 9,000,000,000 shares authorized, 560,534,032 and 541,642,725 outstanding as of September 30, 2020 and December 31, 2019, respectively	5,605	5,416
Additional paid-in capital	9,521,179	9,010,194
Accumulated deficit	(646,950)	(524,588)
Accumulated other comprehensive loss	(598,966)	(276,600)
Total stockholders' equity	8,280,868	8,214,422
Non-controlling interests	50,509	51,656
Total equity	8,331,377	8,266,078
Total liabilities and equity	$ 17,750,787	$ 17,392,910
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01

XML

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Sep. 30, 2020	Dec. 31, 2019
Statement of Financial Position [Abstract]
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized (in shares)	900,000,000	900,000,000
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	9,000,000,000	9,000,000,000
Common stock, shares outstanding (in shares)	560,534,032	541,642,725

XML

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Income Statement [Abstract]
Rental revenues and other property income	$ 459,184	$ 443,326	$ 1,358,728	$ 1,320,408
Expenses:
Property operating and maintenance	177,997	175,491	511,915	502,411
Property management expense	14,824	15,872	43,725	47,053
General and administrative	17,972	16,405	46,626	58,899
Interest expense	87,713	89,067	258,541	278,756
Depreciation and amortization	138,147	133,315	410,440	399,955
Impairment and other	1,723	4,740	4,670	11,803
Total expenses	438,376	434,890	1,275,917	1,298,877
Other, net	(3,049)	4,735	2,035	8,470
Gain on sale of property, net of tax	15,106	20,812	41,473	64,556
Net income	32,865	33,983	126,319	94,557
Net income attributable to non-controlling interests	(211)	(276)	(806)	(1,086)
Net income attributable to common stockholders	32,654	33,707	125,513	93,471
Net income available to participating securities	(114)	(91)	(335)	(306)
Net income available to common stockholders — basic and diluted (Note 12)	$ 32,540	$ 33,616	$ 125,178	$ 93,165
Weighted average common shares outstanding — basic	560,598,995	537,771,245	550,722,684	528,209,033
Weighted average common shares outstanding — diluted	561,871,373	538,644,888	551,947,278	529,160,353
Net income per common share — basic	$ 0.06	$ 0.06	$ 0.23	$ 0.18
Net income per common share — diluted	$ 0.06	$ 0.06	$ 0.23	$ 0.18

XML

CONSOLIDATED STATEMENTS OF OTHER COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Statement of Comprehensive Income [Abstract]
Net income	$ 32,865	$ 33,983	$ 126,319	$ 94,557
Other comprehensive income (loss)
Unrealized losses on interest rate swaps	(4,171)	(71,729)	(398,426)	(308,196)
(Gains) losses from interest rate swaps reclassified into earnings from accumulated other comprehensive loss	37,557	(4,272)	74,166	(23,026)
Other comprehensive income (loss)	33,386	(76,001)	(324,260)	(331,222)
Comprehensive income (loss)	66,251	(42,018)	(197,941)	(236,665)
Comprehensive (income) loss attributable to non-controlling interests	(415)	371	1,088	2,954
Comprehensive income (loss) attributable to common stockholders	$ 65,836	$ (41,647)	$ (196,853)	$ (233,711)

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CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Accumulated Deficit	Accumulated Other Comprehensive Loss	Total Stockholders' Equity	Non-Controlling Interests
Beginning Balance at Dec. 31, 2018	$ 8,369,186	$ 5,206	$ 8,629,462	$ (392,594)	$ (12,963)	$ 8,229,111	$ 140,075
Beginning Balance, common stock, shares outstanding (in shares) at Dec. 31, 2018		520,647,977
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Capital distributions	(2,610)						(2,610)
Net income	$ 94,557			93,471		93,471	1,086
Dividends declared per common share	$ 0.39
Dividends and dividend equivalents declared	$ (206,764)			(206,764)		(206,764)
Issuance of common stock — settlement of RSUs, net of tax	(8,164)	$ 9	(8,173)			(8,164)
Issuance of common stock — settlement of RSUs, net of tax (in shares)		910,452
Stock Issued During Period, Value, Conversion of Convertible Securities	229,944	$ 126	229,818			229,944
Stock Issued During Period, Shares, Conversion of Convertible Securities		12,553,864
Issuance of common stock, net (in shares)		671,020
Stock Issued During Period, Value, New Issues	17,737	$ 7	17,730			17,737
Share-based compensation expense	13,847		12,930			12,930	917
Total other comprehensive income	(331,222)				(327,182)	(327,182)	(4,040)
Redemption of OP Units for common stock	0	$ 36	56,720		(579)	56,177	56,177
Redemption of OP Units for common stock (in shares)		3,573,293
Ending Balance at Sep. 30, 2019	8,176,511	$ 5,384	8,938,487	(505,887)	(340,724)	8,097,260	79,251
Ending Balance, common stock, shares outstanding (in shares) at Sep. 30, 2019		538,356,606
Beginning Balance at Jun. 30, 2019	8,037,468	$ 5,251	8,686,927	(469,129)	(265,370)	7,957,679	79,789
Beginning Balance, common stock, shares outstanding (in shares) at Jun. 30, 2019		525,126,947
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Capital distributions	(724)						(724)
Net income	$ 33,983			33,707		33,707	276
Dividends declared per common share	$ 0.13
Dividends and dividend equivalents declared	$ (70,465)			(70,465)		(70,465)
Issuance of common stock — settlement of RSUs, net of tax	(56)	$ 0	(56)			(56)
Issuance of common stock — settlement of RSUs, net of tax (in shares)		4,775
Stock Issued During Period, Value, Conversion of Convertible Securities	229,944	$ 126	229,818			229,944
Stock Issued During Period, Shares, Conversion of Convertible Securities		12,553,864
Issuance of common stock, net (in shares)		671,020
Stock Issued During Period, Value, New Issues	17,737	$ 7	17,730			17,737
Share-based compensation expense	4,625		4,068			4,068	557
Total other comprehensive income	(76,001)				(75,354)	(75,354)	(647)
Ending Balance at Sep. 30, 2019	8,176,511	$ 5,384	8,938,487	(505,887)	(340,724)	8,097,260	79,251
Ending Balance, common stock, shares outstanding (in shares) at Sep. 30, 2019		538,356,606
Beginning Balance at Dec. 31, 2019	$ 8,266,078	$ 5,416	9,010,194	(524,588)	(276,600)	8,214,422	51,656
Beginning Balance, common stock, shares outstanding (in shares) at Dec. 31, 2019	541,642,725	541,642,725
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Capital distributions	$ (1,603)						(1,603)
Net income	$ 126,319			125,513		125,513	806
Dividends declared per common share	$ 0.45
Dividends and dividend equivalents declared	$ (247,875)			(247,875)		(247,875)
Issuance of common stock — settlement of RSUs, net of tax	$ (3,373)	$ 3	(3,376)			(3,373)
Issuance of common stock — settlement of RSUs, net of tax (in shares)		328,841
Issuance of common stock, net (in shares)	18,891,307	18,562,466
Stock Issued During Period, Value, New Issues	$ 503,798	$ 186	503,612			503,798
Share-based compensation expense	12,293		10,749			10,749	1,544
Total other comprehensive income	(324,260)				(322,366)	(322,366)	(1,894)
Ending Balance at Sep. 30, 2020	$ 8,331,377	$ 5,605	9,521,179	(646,950)	(598,966)	8,280,868	50,509
Ending Balance, common stock, shares outstanding (in shares) at Sep. 30, 2020	560,534,032	560,534,032
Beginning Balance at Jun. 30, 2020	$ 8,343,873	$ 5,605	9,515,625	(595,318)	(632,148)	8,293,764	50,109
Beginning Balance, common stock, shares outstanding (in shares) at Jun. 30, 2020		560,532,679
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Capital distributions	(535)						(535)
Net income	$ 32,865			32,654		32,654	211
Dividends declared per common share	$ 0.15
Dividends and dividend equivalents declared	$ (84,286)			(84,286)		(84,286)
Issuance of common stock — settlement of RSUs, net of tax	$ (12)		(12)			(12)
Issuance of common stock, net (in shares)	1,353	1,353
Stock Issued During Period, Value, New Issues			5,566
Share-based compensation expense	$ 6,086					5,566	520
Total other comprehensive income	33,386				33,182	33,182	204
Ending Balance at Sep. 30, 2020	$ 8,331,377	$ 5,605	$ 9,521,179	$ (646,950)	$ (598,966)	$ 8,280,868	$ 50,509
Ending Balance, common stock, shares outstanding (in shares) at Sep. 30, 2020	560,534,032	560,534,032

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CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019
Operating Activities:
Net income	$ 126,319	$ 94,557
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	410,440	399,955
Share-based compensation expense	12,293	13,847
Amortization of deferred leasing costs	8,830	7,708
Amortization of deferred financing costs	18,153	29,386
Amortization of debt discounts	4,077	6,026
Provisions for impairment	4,202	11,289
Gain on sale of property, net of tax	(41,473)	(64,556)
Change in fair value of derivative instruments	4,410	2,010
Other non-cash amounts included in net income	1,814	883
Changes in operating assets and liabilities:
Other assets, net	(22,300)	(4,218)
Accounts payable and accrued expenses	82,971	95,748
Resident security deposits	8,084	28
Other liabilities	7,852	(1,815)
Net cash provided by operating activities	625,672	590,848
Investing Activities:
Amounts deposited and held by others	(4,046)	(5,572)
Acquisition of single-family residential properties	(337,415)	(405,142)
Initial renovations to single-family residential properties	(71,666)	(35,017)
Other capital expenditures for single-family residential properties	(127,702)	(118,423)
Proceeds from sale of single-family residential properties	338,486	493,224
Repayment proceeds from retained debt securities	8,133	40,034
Other investing activities	(165)	4,325
Net cash used in investing activities	(194,375)	(26,571)
Financing Activities:
Payment of dividends and dividend equivalents	(247,651)	(206,764)
Distributions to non-controlling interests	(1,603)	(2,610)
Payment of taxes related to net share settlement of RSUs	(3,373)	(8,164)
Payments on mortgage loans	(157,791)	(798,415)
Proceeds from secured term loan	0	403,464
Payments on secured term loan	(101)	0
Proceeds from revolving facility	320,000	215,000
Payments on revolving facility	(320,000)	(215,000)
Proceeds from issuance of common stock, net	503,798	17,737
Deferred financing costs paid	0	(2,613)
Other financing activities	(1,913)	(490)
Net cash provided by (used in) financing activities	91,366	(597,855)
Change in cash, cash equivalents, and restricted cash	522,663	(33,578)
Cash, cash equivalents, and restricted cash, beginning of period (Note 4)	286,245	359,991
Cash, cash equivalents, and restricted cash, end of period (Note 4)	808,908	326,413
Supplemental cash flow disclosures:
Interest paid, net of amounts capitalized	236,714	249,085
Cash paid for income taxes	1,284	2,320
Operating cash flows from operating leases	4,117	4,056
Financing cash flows from finance leases	1,714	379
Noncash Investing and Financing Items [Abstract]
Accrued renovation improvements at period end	6,273	5,724
Accrued residential property capital improvements at period end	10,677	15,429
Transfer of residential property, net to other assets, net for held for sale assets	134,361	490,397
Change in other comprehensive loss from cash flow hedges	(328,472)	(333,135)
ROU assets obtained in exchange for operating lease liabilities	4,617	1,721
ROU assets obtained in exchange for finance lease liabilities	9,484	0
Net settlement of 2019 Convertible Notes in shares of common stock	$ 0	$ 229,944

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Organization and Formation

9 Months Ended

Sep. 30, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization and Formation

Invitation Homes Inc. (“INVH”) is a real estate investment trust (“REIT”) that conducts its operations through Invitation Homes Operating Partnership LP (“INVH LP”). INVH LP was formed for the purpose of owning, renovating, leasing, and operating single-family residential properties. Through THR Property Management L.P., a wholly owned subsidiary of INVH LP (the “Manager”), we provide all management and other administrative services with respect to the properties we own.

On February 6, 2017, INVH completed an initial public offering (“IPO”), changed its jurisdiction of incorporation to Maryland, and amended its charter to provide for the issuance of up to 9,000,000,000 shares of common stock and 900,000,000 shares of preferred stock, in each case $0.01 par value per share. In connection with certain pre-IPO reorganization transactions, INVH LP became (1) owned by INVH directly and through Invitation Homes OP LLC, a wholly owned subsidiary of INVH, and (2) the owner of all of the assets, liabilities, and operations of certain pre-IPO ownership entities. These transactions were accounted for as a reorganization of entities under common control utilizing historical cost basis.

On November 16, 2017 (the “Merger Date”), INVH and certain of its affiliates entered into a series of transactions with Starwood Waypoint Homes (“SWH”) and certain SWH affiliates which resulted in SWH and its operating partnership being merged into INVH and INVH LP, respectively, with INVH and INVH LP being the surviving entities (the “Mergers”). The Mergers were accounted for as a business combination in accordance with ASC 805, Business Combinations, and INVH was designated as the accounting acquirer.

The limited partnership interests of INVH LP consist of common units and other classes of limited partnership interests that may be issued (the “OP Units”). As of September 30, 2020, INVH owns 99.4% of the common OP Units and has the full, exclusive, and complete responsibility for and discretion over the day to day management and control of INVH LP.

Our organizational structure includes several wholly owned subsidiaries of INVH LP that were formed to facilitate certain of our financing arrangements (the “Borrower Entities”). These Borrower Entities are used to align the ownership of our single-family residential properties with certain of our debt instruments. Collateral for certain of our individual debt instruments may be in the form of equity interests in the Borrower Entities or in pools of single-family residential properties owned either directly by the Borrower Entities or indirectly by their wholly owned subsidiaries (see Note 6).

References to “Invitation Homes,” the “Company,” “we,” “our,” and “us” refer, collectively, to INVH, INVH LP, and the consolidated subsidiaries of INVH LP.

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Significant Accounting Policies

9 Months Ended

Sep. 30, 2020

Accounting Policies [Abstract]

Significant Accounting Policies

Note 2—Significant Accounting Policies

Basis of Presentation

The accompanying interim condensed consolidated financial statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and with the rules and regulations of the Securities and Exchange Commission for interim financial information and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements and should be read in conjunction with our audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2019.

These condensed consolidated financial statements include the accounts of INVH and its consolidated subsidiaries. All intercompany accounts and transactions have been eliminated in the condensed consolidated financial statements. In the opinion of management, all adjustments that are of a normal recurring nature considered necessary for a fair presentation of our interim financial statements have been included in these condensed consolidated financial statements. Operating results for the nine months ended September 30, 2020 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2020.

We consolidate entities when we own, directly or indirectly, a majority interest in the entity or are otherwise able to control the entity. We consolidate variable interest entities (“VIEs”) in accordance with ASC 810, Consolidation, if we are the primary beneficiary of the VIE as determined by our power to direct the VIE’s activities and the obligation to absorb its losses or the right to receive its benefits, which are potentially significant to the VIE. A VIE is broadly defined as an entity with one or more of the following characteristics: (a) the total equity investment at risk is insufficient to finance the entity’s activities without additional subordinated financial support; (b) as a group, the holders of the equity investment at risk lack (i) the ability to make decisions about the entity’s activities through voting or similar rights, (ii) the obligation to absorb the expected losses of the entity, or (iii) the right to receive the expected residual returns of the entity; or (c) the equity investors have voting rights that are not proportional to their economic interests, and substantially all of the entity’s activities either involve, or are conducted on behalf of, an investor that has disproportionately few voting rights.

As described in Note 5, we have an investment in a joint venture with the Federal National Mortgage Association (“FNMA”), which is a voting interest entity. We do not hold a controlling financial interest in the joint venture but have significant influence over its operating and financial policies. Additionally, FNMA holds certain substantive participating rights that preclude the presumption of control by us; as such, we account for our investment using the equity method. In connection with the Mergers, we initially recorded this investment at fair value in connection with purchase accounting and have subsequently adjusted for our proportionate share of net earnings or losses and other comprehensive income or loss, cash contributions made and distributions received, and other adjustments, as appropriate. Distributions of operating profit from the joint venture are reported as part of operating cash flows while distributions related to a capital transaction, such as a refinancing transaction or sale, are reported as investing activities.

Non-controlling interests represent the OP Units not owned by INVH, including any vested OP Units granted in connection with certain share-based compensation awards. Non-controlling interests are presented as a separate component of equity on the condensed consolidated balance sheets as of September 30, 2020 and December 31, 2019, and the condensed consolidated statements of operations for the three and nine months ended September 30, 2020 include an allocation of the net income attributable to the non-controlling interest holders. Vested OP Units are redeemable for shares of our common stock on a one-for-one basis or, in our sole discretion, cash, and redemptions of OP Units are accounted for as a reduction in non-controlling interests with an offset to stockholders’ equity based on the pro rata number of OP Units redeemed.

Significant Risks and Uncertainties

One of the most significant risks and uncertainties to our financial condition and results of operations is the potential adverse effect of the ongoing pandemic resulting from the coronavirus, or COVID-19. Since the outbreak, a number of our residents have requested rent deferral and/or late fee relief, and components of our rental revenues and other property income have been impacted by the pandemic. In addition, entities directed by, or notionally affiliated with, the Federal government as well as some jurisdictions across the United States have imposed temporary eviction moratoriums and are allowing residents to defer missed rent payments without incurring late fees, and jurisdictions and other local and national authorities may expand or extend measures imposing restrictions on our ability to enforce residents’ contractual rental obligations and limiting our ability to increase rents. We cannot predict if states, municipalities, local, and/or national authorities will expand existing restrictions, if additional states or municipalities will implement similar restrictions, or when restrictions currently in place will expire. Certain other restrictions imposed by jurisdictions across the United States are intended to limit operations by businesses not deemed “essential businesses.” While none of the current restrictions have materially impacted our ability to provide services to our residents or homes, future measures may negatively impact our ability to access our homes, complete service requests, or make our homes ready for new residents.

The COVID-19 pandemic could have material and adverse effects on our financial condition, results of operations, and cash flows in the near term due to, but not limited to, the following: (1) reduced economic activity that severely impacts the earnings or health of our residents, thereby causing them to be unable to fully meet their obligations to us and resulting in increases in uncollectible revenues and thus reductions in rental revenues and other property income; (2) governmental restrictions and moratoriums that negatively impact our ability to charge and collect rental revenues and other property income or impose restrictions on our ability to provide services to our residents and homes; (3) negative financial impact of the pandemic that could impact our ability to access funds available under our Revolving Facility (as defined in Note 6) or affect future compliance with financial covenants of our Credit Facility (as defined in Note 6) and other debt agreements; and (4) weaker economic conditions that could cause us to recognize impairments in value of our tangible assets or goodwill.

The extent to which the COVID-19 pandemic ultimately impacts our operations depends on ongoing developments, which remain highly uncertain and cannot be predicted with confidence, including the scope, severity, and duration of the pandemic, the extent and duration of actions taken to contain the pandemic or mitigate its impact, and the direct and indirect economic effects of the pandemic, containment measures, monetary and/or fiscal policies implemented to provide support or relief to businesses and/or residents, and other government, regulatory, and/or legislative changes precipitated by the COVID-19 pandemic, among others. While we have taken steps to mitigate the impact of the pandemic on our results of operations, there can be no assurance that these efforts will be successful.

Adoption of New Accounting Standards

In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which changes how companies measure credit losses for certain financial assets, excluding receivables arising from operating leases. This guidance requires an entity to estimate its expected credit loss and record an allowance based on this estimate so that it is presented at the net amount expected to be collected on the financial asset. We adopted this standard as of January 1, 2020, and it did not have a material impact on our condensed consolidated financial statements.

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848) (“ASU 2020-04”), which contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives, and other contracts. The guidance in ASU 2020-04 is optional and may be elected over time as reference rate reform activities occur. We have elected to apply the hedge accounting expedients related to probability and the assessments of effectiveness for future London Interbank Offer Rate (“LIBOR”) indexed cash flows to assume that the index upon which future hedged transactions will be based matches the index on the corresponding derivatives. Application of these expedients preserves the presentation of derivatives consistent with past presentation. We continue to evaluate the impact of the guidance and may apply other elections as applicable as additional changes in the market occur.

In April 2020, the FASB staff issued a question and answer document (the “Lease Modification Q&A”) focused on the application of lease accounting guidance to lease accommodations resulting from the COVID-19 pandemic as many lessors have been asked to provide rent deferrals, rent abatements, late fee waivers, and other lease concessions to lessees (collectively, “lease accommodations”). While the lease modification guidance in ASC 842, Leases, addresses routine changes to lease terms resulting from negotiations between a lessee and lessor, it did not contemplate the rapid implementation of lease accommodations to address the sudden liquidity constraints of some lessees arising from the COVID-19 pandemic.

Under existing lease guidance, we would have been required to determine, on a lease by lease basis, if each lease accommodation resulted from a new arrangement reached with the resident (treated within the lease modification accounting framework) or if each was contemplated under the enforceable rights and obligations within the existing lease agreement (precluded from applying the lease modification accounting framework). If certain criteria are met, the Lease Modification Q&A allows lessors to bypass the lease by lease analysis and instead elect to either apply the lease modification accounting framework or not, with such election applied consistently to leases with similar characteristics and similar circumstances. We elected to apply the Lease Modification Q&A guidance not to perform a lease by lease analysis with respect to any lease accommodations and to account for such accommodations outside of the lease modification framework. The Lease Modification Q&A has not had a material impact on our condensed consolidated financial statements for the three and nine months ended September 30, 2020. However, the extent of lease accommodations granted to residents as a result of the COVID-19 pandemic in future periods may materially affect our condensed consolidated financial statements.

Use of Estimates

The preparation of the condensed consolidated financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements, as well as the reported amounts of revenues and expenses during the reporting periods. These estimates are inherently subjective in nature and actual results could differ from those estimates.

Accounting Policies

There have been no changes to our significant accounting policies that have had a material impact on our condensed consolidated financial statements and related notes, compared to those policies disclosed in our audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2019.

Recent Accounting Pronouncements

In August 2020, the FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”), which simplifies an issuer’s accounting for convertible instruments and contracts in its own equity. The guidance reduces the number of accounting models for convertible instruments, requires entities to use the “if-converted” method in diluted earnings (loss) per share (“EPS”), and requires that the effect of potential share settlement be included in the diluted EPS calculation when an instrument may be settled in cash or shares. The new standard will be effective for annual reporting periods beginning after December 15, 2021, and interim periods within that reporting period, with early adoption permitted beginning after December 15, 2020 and interim periods within that reporting period. Our 2022 Convertible Notes (as defined in Note 6) are the only instruments we have that will be subject to ASU 2020-06, and these notes mature on January 15, 2022. As such, ASU 2020-06 will not materially affect our condensed consolidated financial statements.

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Investments in Single-Family Residential Properties

9 Months Ended

Sep. 30, 2020

Real Estate [Abstract]

Investments in Single-Family Residential Properties

Note 3—Investments in Single-Family Residential Properties

The following table sets forth the net carrying amount associated with our properties by component:

	September 30, 2020		December 31, 2019
Land	$	4,501,831	$	4,499,346
Single-family residential property	13,386,936		13,121,179
Capital improvements	511,034		513,269
Equipment	113,359		113,370
Total gross investments in the properties	18,513,160		18,247,164
Less: accumulated depreciation	(2,381,059)		(2,003,972)
Investments in single-family residential properties, net	$	16,132,101	$	16,243,192

As of September 30, 2020 and December 31, 2019, the carrying amount of the residential properties above includes $119,292 and $119,608, respectively, of capitalized acquisition costs (excluding purchase price), along with $67,483 and $65,747, respectively, of capitalized interest, $26,541 and $25,565, respectively, of capitalized property taxes, $4,639 and $4,616, respectively, of capitalized insurance, and $3,023 and $2,836, respectively, of capitalized homeowners’ association (“HOA”) fees.

During the three months ended September 30, 2020 and 2019, we recognized $136,517 and $132,266, respectively, of depreciation expense related to the components of the properties, and $1,630 and $1,049, respectively, of depreciation and amortization related to corporate furniture and equipment. These amounts are included in depreciation and amortization in the condensed consolidated statements of operations. Further, during the three months ended September 30, 2020 and 2019, impairments totaling $289 and $3,960, respectively, have been recognized and are included in impairment and other in the condensed consolidated statements of operations. See Note 11 for additional information regarding these impairments.

During the nine months ended September 30, 2020 and 2019, we recognized $406,078 and $396,568, respectively, of depreciation expense related to the components of the properties and $4,362 and $3,387, respectively, of depreciation and amortization related to corporate furniture and equipment. These amounts are included in depreciation and amortization in the condensed consolidated statements of operations. Further, during the nine months ended September 30, 2020 and 2019, impairments totaling $4,202 and $11,289, respectively, have been recognized and are included in impairment and other in the condensed consolidated statements of operations. See Note 11 for additional information regarding these impairments.

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Cash, Cash Equivalents, and Restricted Cash

9 Months Ended

Sep. 30, 2020

Cash and Cash Equivalents [Abstract]

Cash, Cash Equivalents, and Restricted Cash

Note 4—Cash, Cash Equivalents, and Restricted Cash

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

	September 30, 2020		December 31, 2019
Cash and cash equivalents	$	559,567	$	92,258
Restricted cash	249,341		193,987
Total cash, cash equivalents, and restricted cash shown in the condensed consolidated statements of cash flows	$	808,908	$	286,245

Pursuant to the terms of the mortgage loans and Secured Term Loan (as defined in Note 6), we are required to establish, maintain, and fund from time to time (generally, either monthly or at the time borrowings are funded) certain specified reserve accounts. These reserve accounts include, but are not limited to, the following types of accounts: (i) property tax reserves; (ii) insurance reserves; (iii) capital expenditure reserves; and (iv) HOA reserves. The reserve accounts associated with our mortgage loans and Secured Term Loan are under the sole control of the loan servicer. Additionally, we hold security deposits pursuant to resident lease agreements that we are required to segregate. We are also required to hold letters of credit by certain of our insurance policies. Accordingly, amounts funded to these reserve accounts, security deposit accounts, and other restricted accounts have been classified on our condensed consolidated balance sheets as restricted cash.

The amounts funded, and to be funded, to the reserve accounts are subject to formulae included in the mortgage loan and Secured Term Loan agreements and are to be released to us subject to certain conditions specified in the loan agreements being met. To the extent that an event of default were to occur, the loan servicer has discretion to use such funds to either settle the applicable operating expenses to which such reserves relate or reduce the allocated loan amount associated with a residential property of ours.

The balances of our restricted cash accounts, as of September 30, 2020 and December 31, 2019, are set forth in the table below. As of September 30, 2020 and December 31, 2019, no amounts were funded to the insurance accounts as the conditions specified in the mortgage loan and Secured Term Loan agreements that require such funding did not exist.

	September 30, 2020		December 31, 2019
Resident security deposits	$	156,207	$	148,186
Property taxes	57,296		10,443
Collections	24,642		24,034
Capital expenditures	5,628		5,627
Letters of credit	3,319		3,459
Special and other reserves	2,249		2,238
Total	$	249,341	$	193,987

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Debt

9 Months Ended

Sep. 30, 2020

Debt Disclosure [Abstract]

Debt

Note 6—Debt

Mortgage Loans

Our securitization transactions (the “Securitizations” or the “mortgage loans”) are collateralized by certain homes owned by the respective Borrower Entities. We utilize the proceeds from our securitizations to fund: (i) repayments of then-outstanding indebtedness; (ii) initial deposits into Securitization reserve accounts; (iii) closing costs in connection with the mortgage loans; and (iv) general costs associated with our operations.

The following table sets forth a summary of our mortgage loan indebtedness as of September 30, 2020 and December 31, 2019:

						Outstanding Principal Balance(5)
	Origination Date	Maturity Date(1)	Maturity Date if Fully Extended(2)	Interest Rate(3)	Range of Spreads(4)	September 30, 2020		December 31, 2019
IH 2017-1(6)	April 28, 2017	June 9, 2027	June 9, 2027	4.23%	N/A	$	994,699	$	995,520
SWH 2017-1(7)(8)	September 29, 2017	October 9, 2020	January 9, 2023	1.72%	102-347 bps	732,778		744,092
IH 2017-2(7)(9)	November 9, 2017	December 9, 2020	December 9, 2024	1.30%	91-186 bps	614,031		624,475
IH 2018-1(7)	February 8, 2018	March 9, 2021	March 9, 2025	1.27%	76-206 bps	775,118		793,720
IH 2018-2(7)	May 8, 2018	June 9, 2021	June 9, 2025	1.49%	95-230 bps	928,939		957,135
IH 2018-3(7)	June 28, 2018	July 9, 2021	July 9, 2025	1.50%	105-230 bps	1,138,876		1,213,035
IH 2018-4(7)(10)	November 7, 2018	January 9, 2021	January 9, 2026	1.57%	115-225 bps	924,439		938,430
Total Securitizations						6,108,880		6,266,407
Less: deferred financing costs, net						(13,900)		(27,946)
Total						$	6,094,980	$	6,238,461

(1)The maturity dates above reflect all extension options that have been exercised.

(2)Represents the maturity date if we exercise each of the remaining one year extension options available, which are subject to certain conditions being met.

(3)Except for IH 2017-1, interest rates are based on a weighted average spread over LIBOR (or a comparable or successor rate as provided for in our loan agreements), plus applicable servicing fees; as of September 30, 2020, LIBOR was 0.15%. Our IH 2017-1 mortgage loan bears interest at a fixed rate of 4.23% per annum, equal to the market determined pass-through rate payable on the certificates including applicable servicing fees.

(4)Range of spreads is based on outstanding principal balances as of September 30, 2020.

(5)Outstanding principal balance is net of discounts and does not include deferred financing costs, net.

(6)Net of unamortized discount of $2,377 and $2,641 as of September 30, 2020 and December 31, 2019, respectively.

(7)The initial maturity term of each of these mortgage loans is two years, individually subject to three to five, one year extension options at the Borrower Entity’s discretion (provided that there is no continuing event of default under the mortgage loan agreement and the Borrower Entity obtains and delivers a replacement interest rate cap agreement from an approved counterparty within the required timeframe to the lender). Our SWH 2017-1, IH 2017-2, IH 2018-1, IH 2018-2 and IH 2018-3 mortgage loans have exercised the first extension option. The maturity dates above reflect all extensions that have been exercised.

(8)On October 9, 2020, the extension of the maturity date of the SWH 2017-1 mortgage loan from October 9, 2020 to October 9, 2021 was approved by the lender (see Note 15).

(9)On September 2, 2020, we submitted a notification to request an extension of the maturity of the IH 2017-2 mortgage loan from December 9, 2020 to December 9, 2021.

(10)On October 1, 2020, we submitted a notification to request an extension of the maturity date of the IH 2018-4 mortgage loan from January 9, 2021 to January 9, 2022 (see Note 15).

Securitization Transactions

For each Securitization transaction, the Borrower Entity executed a loan agreement with a third party lender. Except for IH 2017-1, each outstanding mortgage loan originally consisted of six floating rate components. The two year initial terms are individually subject to three to five, one year extension options at the Borrower Entity’s discretion. Such extensions are available provided there is no continuing event of default under the respective mortgage loan agreement and the Borrower Entity obtains and delivers a replacement interest rate cap agreement from an approved counterparty within the required timeframe to the lender. IH 2017-1 is a 10 year, fixed rate mortgage loan comprised of two components. Certificates issued by the trust in connection with Component A of IH 2017-1 benefit from FNMA’s guaranty of timely payment of principal and interest.

Each mortgage loan is secured by a pledge of the equity in the assets of the respective Borrower Entities, as well as first-priority mortgages on the underlying properties and a grant of security interests in all of the related personal property. As of September 30, 2020 and December 31, 2019, a total of 35,651 and 37,040 homes, respectively, with a net book value of $6,800,437 and $7,137,576, respectively, are pledged pursuant to the mortgage loans. Each Borrower Entity has the right, subject to certain requirements and limitations outlined in the respective loan agreements, to substitute properties. We are obligated to make monthly payments of interest for each mortgage loan.

Transactions with Trusts

Concurrent with the execution of each mortgage loan agreement, the respective third party lender sold each loan it originated to individual depositor entities (the “Depositor Entities”) who subsequently transferred each loan to Securitization-specific trust entities (the “Trusts”). The Depositor Entities for our currently outstanding Securitizations are wholly owned subsidiaries. We accounted for the transfers of the individual Securitizations from the wholly owned Depositor Entities to the respective Trusts as sales under ASC 860, Transfers and Servicing, with no resulting gain or loss as the Securitizations were both originated by the lender and immediately transferred at the same fair market value.

As consideration for the transfer of each loan to the Trusts, the Trusts issued classes of certificates which mirror the components of the individual loans (collectively, the “Certificates”) to the Depositor Entities, except that Class R certificates do not have related loan components as they represent residual interests in the Trusts. The Certificates represent the entire beneficial interest in the Trusts. Following receipt of the Certificates, the Depositor Entities sold the Certificates to investors and used the proceeds as consideration for the loans sold to the Depositor Entities by the lenders. These transactions had no effect on our condensed consolidated financial statements other than with respect to Certificates we retained in connection with Securitizations or purchased at a later date.

The Trusts are structured as pass-through entities that receive interest payments from the Securitizations and distribute those payments to the holders of the Certificates. The assets held by the Trusts are restricted and can only be used to fulfill the obligations of those entities. The obligations of the Trusts do not have any recourse to the general credit of any entities in these condensed consolidated financial statements. We have evaluated our interests in certain certificates of the Trusts held by us (discussed below) and determined that they do not create a more than insignificant variable interest in the Trusts. Additionally, the retained certificates do not provide us with any ability to direct activities that could impact the Trusts’ economic performance. Therefore, we do not consolidate the Trusts.

Retained Certificates

As the Trusts made Certificates available for sale to both domestic and foreign investors, sponsors of the mortgage loans are required to retain a portion of the risk that represents a material net economic interest in each loan pursuant to Regulation RR (the “Risk Retention Rules”) under the Securities Exchange Act of 1934, as amended. As such, loan sponsors are required to retain a portion of the credit risk that represents not less than 5% of the aggregate fair value of the loan as of the closing date.

IH 2017-1 issued Class B certificates, which are restricted certificates that were made available exclusively to INVH LP in order to comply with the Risk Retention Rules. The Class B certificates bear a stated annual interest rate of 4.23%, including applicable servicing fees.

For SWH 2017-1, IH 2017-2, IH 2018-1, IH 2018-2, IH 2018-3, and IH 2018-4, we retain 5% of each class of certificates to meet the Risk Retention Rules. These retained certificates accrue interest at a floating rate of LIBOR plus a spread ranging from 0.76% to 3.47%.

The retained certificates total $309,122 and $316,991 as of September 30, 2020 and December 31, 2019, respectively, and are classified as held to maturity investments and recorded in other assets, net on the condensed consolidated balance sheets (see Note 5).

Loan Covenants

The general terms that apply to all of the mortgage loans require each Borrower Entity to maintain compliance with certain affirmative and negative covenants. Affirmative covenants include each Borrower Entity’s, and certain of their respective affiliates’, compliance with (i) licensing, permitting and legal requirements specified in the mortgage loan agreements, (ii) organizational requirements of the jurisdictions in which they are organized, (iii) federal and state tax laws, and (iv) books and records requirements specified in the respective mortgage loan agreements. Negative covenants include each Borrower Entity’s, and certain of their affiliates’, compliance with limitations surrounding (i) the amount of each Borrower Entity’s indebtedness and the nature of their investments, (ii) the execution of transactions with affiliates, (iii) the Manager, (iv) the nature of each Borrower Entity’s business activities, and (v) the required maintenance of specified cash reserves. As of September 30, 2020, and through the date our condensed consolidated financial statements were issued, we believe each Borrower Entity is in compliance with all affirmative and negative covenants.

Prepayments

For the mortgage loans, prepayments of amounts owed by us are generally not permitted under the terms of the respective mortgage loan agreements unless such prepayments are made pursuant to the voluntary election or mandatory provisions specified in such agreements. The specified mandatory provisions become effective to the extent that a property becomes characterized as a disqualified property, a property is sold, and/or upon the occurrence of a condemnation or casualty event associated with a property. To the extent either a voluntary election is made, or a mandatory prepayment condition exists, in addition to paying all interest and principal, we must also pay certain breakage costs as determined by the loan servicer and a spread maintenance premium if prepayment occurs before the month following the one or two year anniversary of the closing dates of each of the mortgage loans except for IH 2017-1. For IH 2017-1, prepayments on or before December 2026 will require a yield maintenance premium. For the nine months ended September 30, 2020 and 2019, we made voluntary and mandatory prepayments of $157,791 and $798,415, respectively, under the terms of the mortgage loan agreements. During the nine months ended September 30, 2019, prepayments included the full repayment of the CSH 2016-2 mortgage loan.

Secured Term Loan

On June 7, 2019, 2019-1 IH Borrower LP, a consolidated subsidiary (“2019-1 IH Borrower” and one of our Borrower Entities), entered into a 12 year loan agreement with a life insurance company (the “Secured Term Loan”). The Secured Term Loan bears interest at a fixed rate of 3.59%, including applicable servicing fees, for the first 11 years and bears interest at a floating rate based on a spread of 147 bps, including applicable servicing fees, over one month LIBOR (subject to certain adjustments as outlined in the loan agreement) for the twelfth year. The Secured Term Loan is secured by first priority mortgages on a portfolio of single-family rental properties as well as a first priority pledge of the equity interests of 2019-1 IH Borrower. We utilized the proceeds from the Secured Term Loan to fund: (i) repayments of then-outstanding indebtedness; (ii) initial deposits into the Secured Term Loan’s reserve accounts; (iii) transaction costs related to the closing of the Secured Term Loan; and (iv) general corporate purposes.

The following table sets forth a summary of our Secured Term Loan indebtedness as of September 30, 2020 and December 31, 2019:

	Maturity Date	Interest Rate(1)	September 30, 2020		December 31, 2019
Secured Term Loan	June 9, 2031	3.59%	$	403,363	$	403,464
Deferred financing costs, net			(2,323)		(2,486)
Secured Term Loan, net			$	401,040	$	400,978

(1)The Secured Term Loan bears interest at a fixed rate of 3.59% per annum including applicable servicing fees for the first 11 years and for the twelfth year bears interest at a floating rate based on a spread of 147 bps over one month LIBOR (or a comparable or successor rate as provided for in our loan agreement), including applicable servicing fees, subject to certain adjustments as outlined in the loan agreement. Interest payments are made monthly.

Collateral

The Secured Term Loan’s collateral pool contains 3,332 and 3,333 homes, respectively, as of September 30, 2020 and December 31, 2019, with a net book value of $724,041 and $734,759, respectively. 2019-1 IH Borrower has the right, subject to certain requirements and limitations outlined in the loan agreement, to substitute properties representing up to 20% of the collateral pool annually, and to substitute properties representing up to 100% of the collateral pool over the life of the Secured Term Loan. In addition, four times after the first anniversary of the closing date, 2019-1 IH Borrower has the right, subject to certain requirements and limitations outlined in the loan agreement, to execute a special release of collateral representing up to 15% of the then-outstanding principal balance of the Secured Term Loan in order to bring the loan-to-value ratio back in line with the Secured Term Loan’s loan-to-value ratio as of the closing date. Any such special release of collateral would not change the then-outstanding principal balance of the Secured Term Loan, but rather would reduce the number of single-family rental homes included in the collateral pool.

Loan Covenants

The Secured Term Loan requires 2019-1 IH Borrower to maintain compliance with certain affirmative and negative covenants. Affirmative covenants include 2019-1 IH Borrower’s, and certain of its affiliates’, compliance with (i) licensing, permitting and legal requirements specified in the loan agreement, (ii) organizational requirements of the jurisdictions in which they are organized, (iii) federal and state tax laws, and (iv) books and records requirements specified in the loan agreement. Negative covenants include 2019-1 IH Borrower’s, and certain of its affiliates’, compliance with limitations surrounding (i) the amount of 2019-1 IH Borrower’s indebtedness and the nature of its investments, (ii) the execution of transactions with affiliates, (iii) the Manager, (iv) the nature of 2019-1 IH Borrower’s business activities, and (v) the required maintenance of specified cash reserves. As of September 30, 2020, and through the date our condensed consolidated financial statements were issued, we believe 2019-1 IH Borrower is in compliance with all affirmative and negative covenants.

Prepayments

Prepayments of the Secured Term Loan are generally not permitted unless such prepayments are made pursuant to the voluntary election or mandatory provisions specified in the loan agreement. The specified mandatory provisions become effective to the extent that a property becomes characterized as a disqualified property, a property is sold, and/or upon the occurrence of a condemnation or casualty event associated with a property. To the extent either a voluntary election is made, or a mandatory prepayment condition exists, in addition to paying all interest and principal, we must also pay certain breakage costs as determined by the loan servicer and a yield maintenance premium if prepayment occurs before June 9, 2030. For the nine months ended September 30, 2020, we made mandatory prepayments of $101. No prepayments were made for the nine months ended September 30, 2019.

Term Loan Facility and Revolving Facility

On February 6, 2017, we entered into a credit agreement with a syndicate of banks, financial institutions, and institutional lenders for a credit facility (the “Credit Facility”), which was amended on December 18, 2017 to include all entities and homes acquired in the Mergers. The Credit Facility provides $2,500,000 of borrowing capacity and consists of a $1,000,000 revolving facility (the “Revolving Facility”), which will mature on February 6, 2021, with a one year extension option, and a $1,500,000 term loan facility (the “Term Loan Facility”), which will mature on February 6, 2022. The Revolving Facility also includes borrowing capacity available for letters of credit and for short-term borrowings referred to as swing line borrowings, in each case subject to certain sublimits. The Credit Facility provides us with the option to enter into additional incremental credit facilities (including an uncommitted incremental facility that provides us with the option to increase the size of the Revolving Facility and/or the Term Loan Facility by an aggregate amount of up to $1,500,000), subject to certain limitations. Proceeds from the Term Loan Facility were used to repay then-outstanding indebtedness and for general corporate purposes. Proceeds from the Revolving Facility are used for general corporate purposes.

The following table sets forth a summary of the outstanding principal amounts under the Credit Facility as of September 30, 2020 and December 31, 2019:

	Maturity Date	Interest Rate(1)	September 30, 2020		December 31, 2019
Term Loan Facility	February 6, 2022	1.85%	$	1,500,000	$	1,500,000
Deferred financing costs, net			(4,087)		(6,253)
Term Loan Facility, net			$	1,495,913	$	1,493,747
Revolving Facility(2)	February 6, 2021	1.90%	$	—	$	—

(1)Interest rates for the Term Loan Facility and the Revolving Facility are based on LIBOR plus an applicable margin. As of September 30, 2020, the applicable margins were 1.70% and 1.75%, respectively, and LIBOR was 0.15%.

(2)If we exercise the one year extension option, the maturity date will be February 6, 2022.

Interest Rate and Fees

Borrowings under the Credit Facility bear interest, at our option, at a rate equal to a margin over either (a) a LIBOR rate determined by reference to the Bloomberg LIBOR rate (or a comparable or successor rate as provided for in our loan agreement) for the interest period relevant to such borrowing, or (b) a base rate determined by reference to the highest of (1) the administrative agent’s prime lending rate, (2) the federal funds effective rate plus 0.50%, and (3) the LIBOR rate that would be payable on such day for a LIBOR rate loan with a one month interest period plus 1.00%. The margin is based on a total leverage based grid. The margin for the Revolving Facility ranges from 0.75% to 1.30% in the case of base rate loans, and 1.75% to 2.30% in the case of LIBOR rate loans. The margin for the Term Loan Facility ranges from 0.70% to 1.30% in the case of base rate loans, and 1.70% to 2.30% in the case of LIBOR rate loans. In addition, the Credit Facility provides that, upon receiving an investment grade rating on its non-credit enhanced, senior unsecured long term debt of BBB- or better from Standard & Poor’s Rating Services, a division of The McGraw-Hill Companies, Inc., or Baa3 or better from Moody’s Investors Service, Inc. (an “Investment Grade Rating Event”), we may elect to convert to a credit rating based pricing grid.

In addition to paying interest on outstanding principal under the Credit Facility, we are required to pay a facility fee to the lenders under the Revolving Facility in respect of the unused commitments thereunder. The facility fee rate is based on the daily unused amount of the Revolving Facility and is either 0.35% or 0.20% per annum based on the unused facility amount. Upon converting to a credit rating pricing based grid, the unused facility fee will no longer apply and we will be required to pay a facility fee ranging from 0.125% to 0.300%. We are also required to pay customary letter of credit fees.

Prepayments and Amortization

No principal reductions are required under the Credit Facility. We are permitted to voluntarily repay amounts outstanding under the Term Loan Facility at any time without premium or penalty, subject to certain minimum amounts and the payment of customary “breakage” costs with respect to LIBOR loans. Once repaid, no further borrowings will be permitted under the Term Loan Facility.

Loan Covenants

The Credit Facility contains certain customary affirmative and negative covenants and events of default. Such covenants will, among other things, restrict, subject to certain exceptions, our ability and that of the Subsidiary Guarantors (as defined below) and their respective subsidiaries to (i) engage in certain mergers, consolidations or liquidations, (ii) sell, lease or transfer all or substantially all of their respective assets, (iii) engage in certain transactions with affiliates, (iv) make changes to our fiscal year, (v) make changes in the nature of our business and our subsidiaries, and (vi) incur additional indebtedness that is secured on a pari passu basis with the Credit Facility.

The Credit Facility also requires us, on a consolidated basis with our subsidiaries, to maintain a (i) maximum total leverage ratio, (ii) maximum secured leverage ratio, (iii) maximum unencumbered leverage ratio, (iv) minimum fixed charge coverage ratio, (v) minimum unencumbered fixed charge coverage ratio, and (vi) minimum tangible net worth. If an event of default occurs, the lenders under the Credit Facility are entitled to take various actions, including the acceleration of amounts due under the Credit Facility and all actions permitted to be taken by a secured creditor. As of September 30, 2020, and through the date our condensed consolidated financial statements were issued, we believe we were in compliance with all affirmative and negative covenants.

Guarantees and Security

The obligations under the Credit Facility are guaranteed on a joint and several basis by each of our direct and indirect domestic wholly owned subsidiaries that own, directly or indirectly, unencumbered assets (the “Subsidiary Guarantors”), subject to certain exceptions. The guarantee provided by any Subsidiary Guarantor will be automatically released upon the occurrence of certain events, including if it no longer has a direct or indirect interest in an unencumbered asset or as a result of certain non-recourse refinancing transactions pursuant to which such Subsidiary Guarantor becomes contractually prohibited from providing its guaranty of the Credit Facility. In addition, INVH may be required to provide a guarantee of the Credit Facility under certain circumstances, including if INVH does not maintain its qualification as a REIT.

The Credit Facility is collateralized by first priority or equivalent security interests in all the capital stock of, or other equity interests in, any Subsidiary Guarantor held by us and each of the Subsidiary Guarantors. The security interests granted under the Credit Facility will be automatically released upon the occurrence of certain events, including upon an Investment Grade Rating Event or if the total net leverage ratio is less than or equal to 8.00:1.00 for four consecutive fiscal quarters.

Convertible Senior Notes

In connection with the Mergers, we assumed SWH’s convertible senior notes. In July 2014, SWH issued $230,000 in aggregate principal amount of 3.00% convertible senior notes due 2019 (the “2019 Convertible Notes”). Interest on the 2019 Convertible Notes was payable semiannually in arrears on January 1st and July 1st of each year. The notes matured on July 1, 2019, and we settled substantially all of the outstanding balance of the 2019 Convertible Notes through the issuance of 12,553,864 shares of our common stock.

In January 2017, SWH issued $345,000 in aggregate principal amount of 3.50% convertible senior notes due 2022 (the “2022 Convertible Notes” and together with the 2019 Convertible Notes, the “Convertible Senior Notes”). Interest on the 2022 Convertible Notes is payable semiannually in arrears on January 15th and July 15th of each year. The 2022 Convertible Notes will mature on January 15, 2022.

The following table summarizes the terms of the Convertible Senior Notes outstanding as of September 30, 2020 and December 31, 2019:

						Principal Amount
	Coupon Rate	Effective Rate(1)	Conversion Rate(2)	Maturity Date	Remaining Amortization Period	September 30, 2020		December 31, 2019
2022 Convertible Notes	3.50%	5.12%	43.7694	January 15, 2022	1.29 years	$	345,000	$	345,000
Net unamortized fair value adjustment						(6,888)		(10,701)
Total						$	338,112	$	334,299

(1)Effective rate includes the effect of the adjustment to the fair value of the debt as of the Merger Date, the value of which reduced the initial liability recorded to $324,252 for the 2022 Convertible Notes.

(2)The conversion rate as of September 30, 2020 represents the number of shares of common stock issuable per $1,000 principal amount (actual $) of the 2022 Convertible Notes converted on such date, as adjusted in accordance with the indenture as a result of cash dividend payments and the effects of previous mergers. As of September 30, 2020, the 2022 Convertible Notes do not meet the criteria for conversion. We have the option to settle the 2022 Convertible Notes in cash, common stock, or a combination thereof.

Terms of Conversion

On July 1, 2019, we settled substantially all of the outstanding balance of the 2019 Convertible Notes with the issuance of 12,553,864 shares of our common stock. At the settlement date, the conversion rate applicable to the 2019 Convertible Notes was 54.5954 shares of our common stock per $1,000 principal amount (actual $) of the 2019 Convertible Notes (equivalent to a conversion price of approximately $18.32 per common share — actual $). For the nine months ended September 30, 2019, interest expense for the 2019 Convertible Notes, including non-cash amortization of discounts, was $5,586.

As of September 30, 2020, the conversion rate applicable to the 2022 Convertible Notes is 43.7694 shares of our common stock per $1,000 principal amount (actual $) of the 2022 Convertible Notes (equivalent to a conversion price of approximately $22.85 per common share — actual $). The conversion rate for the 2022 Convertible Notes is subject to adjustment in some events, but will not be adjusted for any accrued and unpaid interest. In addition, following certain events that occur prior to the maturity date, we will adjust the conversion rate for a holder who elects to convert its 2022 Convertible Notes in connection with such an event in certain circumstances. At any time prior to July 15, 2021, holders may convert the 2022 Convertible Notes at their option only under specific circumstances as defined in the indenture agreement, dated as of January 10, 2017, between us and our trustee, Wilmington Trust National Association (the “Convertible Notes Trustee”). On or after July 15, 2021 and until maturity, holders may convert all or any portion of the 2022 Convertible Notes at any time. Upon conversion, we will pay or deliver, as the case may be, cash, common stock, or a combination of cash and common stock, at our election. The “if-converted” value of the 2022 Convertible Notes exceeds the principal amount by $77,661 as of September 30, 2020 as the closing market price of our common stock of $27.99 per common share (actual $) exceeds the implicit conversion price. For the three months ended September 30, 2020 and 2019, interest expense for the 2022 Convertible Notes, including non-cash amortization of discounts, was $4,311 and $4,247, respectively. For the nine months ended September 30, 2020 and 2019, interest expense for the 2022 Convertible Notes, including non-cash amortization of discounts, was $12,869 and $12,681, respectively.

General Terms

We may not redeem the 2022 Convertible Notes prior to their maturity date except to the extent necessary to preserve our status as a REIT for United States federal income tax purposes, as further described in the indenture. If we undergo a fundamental change as defined in the indenture, holders may require us to repurchase for cash all or any portion of their 2022 Convertible Notes at a fundamental change repurchase price equal to 100% of the principal amount of the 2022 Convertible Notes to be repurchased, plus accrued and unpaid interest up to, but excluding, the fundamental change repurchase date.

The indenture contains customary terms and covenants and events of default. If an event of default occurs and is continuing, the Convertible Notes Trustee, by notice to us, or the holders of at least 25% in aggregate principal amount of the outstanding 2022 Convertible Notes, by notice to us and the Convertible Notes Trustee, may, and the Convertible Notes Trustee at the request of such holders shall, declare 100% of the principal of and accrued and unpaid interest on all the 2022 Convertible Notes to be due and payable. In the case of an event of default arising out of certain events of bankruptcy, insolvency or reorganization in respect to us (as set forth in the indenture), 100% of the principal of and accrued and unpaid interest on the 2022 Convertible Notes will automatically become due and payable.

Debt Maturities Schedule

The following table summarizes the contractual maturities of our debt as of September 30, 2020:

Year	Mortgage Loans(1)(2)		Secured Term Loan		Term Loan Facility		Revolving Facility(3)		Convertible Senior Notes		Total
Remainder of 2020	$	1,346,809	$	—	$	—	$	—	$	—	$	1,346,809
2021	3,767,372		—		—		—		—		3,767,372
2022	—		—		1,500,000		—		345,000		1,845,000
2023	—		—		—		—		—		—
2024	—		—		—		—		—		—
Thereafter	994,699		403,363		—		—		—		1,398,062
Total	6,108,880		403,363		1,500,000		—		345,000		8,357,243
Less: deferred financing costs, net	(13,900)		(2,323)		(4,087)		—		—		(20,310)
Less: unamortized fair value adjustment	—		—		—		—		(6,888)		(6,888)
Total	$	6,094,980	$	401,040	$	1,495,913	$	—	$	338,112	$	8,330,045

(1)The maturity dates of the obligations are reflective of all extensions that have been exercised as of September 30, 2020. If fully extended, we would have no mortgage loans maturing before 2023. Such extensions are available provided there is no continuing event of default under the respective mortgage loan agreement and the Borrower Entity obtains and delivers a replacement interest rate cap agreement from an approved counterparty within the required timeframe to the lender.

(2)On September 2, 2020, we submitted a notification to request an extension of the maturity of the IH 2017-2 mortgage loan from December 9, 2020 to December 9, 2021. Additionally, on October 9, 2020, the extension of the maturity date of the SWH 2017-1 mortgage loan from October 9, 2020 to October 9, 2021 was approved by the lender, and on October 1, 2020, we submitted a notification to request an extension of the maturity date of the IH 2018-4 mortgage loan from January 9, 2021 to January 9, 2022 (see Note 15).

(3)If we exercise the one year extension option, the maturity date will be in 2022.

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Derivative Instruments

9 Months Ended

Sep. 30, 2020

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments

Note 7—Derivative Instruments

From time to time, we enter into derivative instruments to manage the economic risk of changes in interest rates. We do not enter into derivative transactions for speculative or trading purposes. Designated hedges are derivatives that meet the criteria for hedge accounting and that we have elected to designate as hedges. Non-designated hedges are derivatives that do not meet the criteria for hedge accounting or that we did not elect to designate as hedges.

Designated Hedges

We have entered into various interest rate swap agreements, which are used to hedge the variable cash flows associated with variable-rate interest payments. Currently, each of our swap agreements is indexed to LIBOR and is designated for hedge accounting purposes. LIBOR is set to expire at the end of 2021, and we will work with the counterparties to our swap agreements to adjust each floating rate to a comparable or successor rate. Changes in the fair value of these swaps are recorded in other comprehensive income and are subsequently reclassified into earnings in the period in which the hedged forecasted transactions affect earnings.

The table below summarizes our interest rate swap instruments as of September 30, 2020:

Agreement Date	Forward Effective Date	Maturity Date	Strike Rate	Index	Notional Amount
December 21, 2016	February 28, 2017	January 31, 2022	1.97%	One month LIBOR	$	750,000
December 11, 2019	February 28, 2017	December 31, 2024	1.74%	One month LIBOR	750,000
April 19, 2018	January 31, 2019	January 31, 2025	2.86%	One month LIBOR	400,000
February 15, 2019	March 15, 2019	March 15, 2022	2.23%	One month LIBOR	800,000
April 19, 2018	March 15, 2019	November 30, 2024	2.85%	One month LIBOR	400,000
April 19, 2018	March 15, 2019	February 28, 2025	2.86%	One month LIBOR	400,000
January 10, 2017	January 15, 2020	January 15, 2021	2.13%	One month LIBOR	550,000
May 8, 2018	March 9, 2020	June 9, 2025	2.99%	One month LIBOR	325,000
May 8, 2018	June 9, 2020	June 9, 2025	2.99%	One month LIBOR	595,000
June 3, 2016	July 15, 2020	July 15, 2021	1.47%	One month LIBOR	450,000
June 28, 2018	August 7, 2020	July 9, 2025	2.90%	One month LIBOR	1,100,000
January 10, 2017	January 15, 2021	July 15, 2021	2.23%	One month LIBOR	550,000
December 9, 2019	July 15, 2021	November 30, 2024	2.90%	One month LIBOR	400,000
November 7, 2018	March 15, 2022	July 31, 2025	3.14%	One month LIBOR	400,000
November 7, 2018	March 15, 2022	July 31, 2025	3.16%	One month LIBOR	400,000

During the three and nine months ended September 30, 2020 and 2019, such derivatives were used to hedge the variable cash flows associated with existing variable-rate interest payments. Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are made on our variable-rate debt. During the next 12 months, we estimate that $152,334 will be reclassified to earnings as an increase in interest expense.

Non-Designated Hedges

Concurrent with entering into certain of the mortgage loan agreements and in connection with previous mergers, we entered into or acquired and maintain interest rate cap agreements with terms and notional amounts equivalent to the terms and amounts of the mortgage loans made by the third party lenders. Currently, each of our cap agreements is indexed to LIBOR, which is set to expire at the end of 2021. We will work with the counterparties to our cap agreements to adjust each floating rate to a comparable or successor rate. To the extent that the maturity date of one or more of the mortgage loans is extended through an exercise of one or more extension options, replacement or extension interest rate cap agreements must be executed with terms similar to those associated with the initial interest rate cap agreements and strike prices equal to the greater of the interest rate cap strike price and the interest rate at which the debt service coverage ratio (as defined) is not less than 1.2 to 1.0. The interest rate cap agreements, including all of our rights to payments owed by the counterparties and all other rights, have been pledged as additional collateral for the mortgage loans. Additionally, in certain instances, in order to minimize the cash impact of purchasing required interest rate caps, we simultaneously sell interest rate caps (which have identical terms and notional amounts) such that the purchase price and sales proceeds of the related interest rate caps are intended to offset each other. The purchased and sold interest rate caps have strike prices ranging from approximately 3.75% to 5.31%.

Fair Values of Derivative Instruments on the Condensed Consolidated Balance Sheets

The table below presents the fair value of our derivative financial instruments as well as their classification on the condensed consolidated balance sheets as of September 30, 2020 and December 31, 2019:

	Asset Derivatives					Liability Derivatives
		Fair Value as of					Fair Value as of
	Balance Sheet Location	September 30, 2020		December 31, 2019		Balance Sheet Location	September 30, 2020		December 31, 2019
Derivatives designated as hedging instruments:
Interest rate swaps	Other assets	$	—	$	1,643	Other liabilities	$	602,507	$	275,679
Derivatives not designated as hedging instruments:
Interest rate caps	Other assets	1		—		Other liabilities	—		—
Total		$	1	$	1,643		$	602,507	$	275,679

Offsetting Derivatives

We enter into master netting arrangements, which reduce risk by permitting net settlement of transactions with the same counterparty. The tables below present a gross presentation, the effects of offsetting, and a net presentation of our derivatives as of September 30, 2020 and December 31, 2019:

	September 30, 2020
							Gross Amounts Not Offset in the Statement of Financial Position
	Gross Amounts of Recognized Assets/ Liabilities		Gross Amounts Offset in the Statement of Financial Position		Net Amounts of Assets/ Liabilities Presented in the Statement of Financial Position		Financial Instruments		Cash Collateral Received		Net Amount
Offsetting assets:
Derivatives	$	1	$	—	$	1	$	—	$	—	$	1
Offsetting liabilities:
Derivatives	$	602,507	$	—	$	602,507	$	—	$	—	$	602,507

	December 31, 2019
							Gross Amounts Not Offset in the Statement of Financial Position
	Gross Amounts of Recognized Assets/ Liabilities		Gross Amounts Offset in the Statement of Financial Position		Net Amounts of Assets/ Liabilities Presented in the Statement of Financial Position		Financial Instruments		Cash Collateral Received		Net Amount
Offsetting assets:
Derivatives	$	1,643	$	—	$	1,643	$	(1,054)	$	—	$	589
Offsetting liabilities:
Derivatives	$	275,679	$	—	$	275,679	$	(1,054)	$	—	$	274,625

Effect of Derivative Instruments on the Condensed Consolidated Statements of Comprehensive Income (Loss) and the Condensed Consolidated Statements of Operations

The tables below present the effect of our derivative financial instruments in the condensed consolidated statements of comprehensive income (loss) and the condensed consolidated statements of operations for the three months ended September 30, 2020 and 2019:

	Amount of Loss Recognized in OCI on Derivative				Location of Gain (Loss) Reclassified from Accumulated OCI into Net Income	Amount of Gain (Loss) Reclassified from Accumulated OCI into Net Income				Total Amount of Interest Expense Presented in the Condensed Consolidated Statements of Operations
	For the Three Months Ended September 30,					For the Three Months Ended September 30,				For the Three Months Ended September 30,
	2020		2019			2020		2019		2020		2019
Derivatives in cash flow hedging relationships:
Interest rate swaps	$	(4,171)	$	(71,729)	Interest expense	$	(37,557)	$	4,272	$	87,713	$	89,067

	Location of Loss Recognized in Net Income on Derivative	Amount of Loss Recognized in Net Income on Derivative
		For the Three Months Ended September 30,
		2020		2019
Derivatives not designated as hedging instruments:
Interest rate caps	Interest expense	$	146	$	64

The tables below present the effect of our derivative financial instruments in the condensed consolidated statements of comprehensive income (loss) and the condensed consolidated statements of operations for the nine months ended September 30, 2020 and 2019:

	Amount of Loss Recognized in OCI on Derivative				Location of Gain (Loss) Reclassified from Accumulated OCI into Net Income	Amount of Gain (Loss) Reclassified from Accumulated OCI into Net Income				Total Amount of Interest Expense Presented in the Condensed Consolidated Statements of Operations
	For the Nine Months Ended September 30,					For the Nine Months Ended September 30,				For the Nine Months Ended September 30,
	2020		2019			2020		2019		2020		2019
Derivatives in cash flow hedging relationships:
Interest rate swaps	$	(398,426)	$	(308,196)	Interest expense	$	(74,166)	$	23,026	$	258,541	$	278,756

	Location of Loss Recognized in Net Income on Derivative	Amount of Loss Recognized in Net Income on Derivative
		For the Nine Months Ended September 30,
		2020		2019
Derivatives not designated as hedging instruments:
Interest rate caps	Interest expense	$	198	$	98

Credit-Risk-Related Contingent Features

The agreements with our derivative counterparties which govern our interest rate swap agreements contain a provision where we could be declared in default on our derivative obligations if repayment of the underlying indebtedness is accelerated by the lender due to our default on the indebtedness.

As of September 30, 2020, the fair value of certain derivatives in a net liability position was $602,507. If we had breached any of these provisions at September 30, 2020, we could have been required to settle the obligations under the agreements at their termination value, which includes accrued interest and excludes the nonperformance risk related to these agreements, of $631,397.

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Equity

9 Months Ended

Sep. 30, 2020

Equity [Abstract]

Equity

The following table summarizes our dividends declared from January 1, 2019 through September 30, 2020:

	Record Date	Amount per Share		Pay Date	Total Amount Declared
Q3-2020	August 12, 2020	$	0.15	August 28, 2020	$	84,286
Q2-2020	May 13, 2020	0.15		May 29, 2020	81,916
Q1-2020	February 12, 2020	0.15		February 28, 2020	81,673
Q4-2019	November 13, 2019	0.13		November 27, 2019	70,693
Q3-2019	August 15, 2019	0.13		August 30, 2019	70,465
Q2-2019	May 15, 2019	0.13		May 31, 2019	68,334
Q1-2019	February 13, 2019	0.13		February 28, 2019	67,965

On October 22, 2020, our board of directors declared a dividend of $0.15 per share to stockholders of record on November 10, 2020, which is payable on November 25, 2020.

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Related Party Transactions

9 Months Ended

Sep. 30, 2020

Related Party Transactions [Abstract]

Related Party Transactions

Note 9—Related Party Transactions

Management Services

One of our consolidated subsidiaries, as the managing member of a joint venture with FNMA (see Note 5), earns a management fee based upon the venture’s gross receipts. For the three months ended September 30, 2020 and 2019, we earned $636 and $696, respectively, and for the nine months ended September 30, 2020 and 2019, we earned $1,945 and $2,145, respectively, of management fees which are included in other, net in the accompanying condensed consolidated statements of operations.

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Share-Based Compensation

9 Months Ended

Sep. 30, 2020

Share-based Payment Arrangement [Abstract]

Share-Based Compensation

Note 10—Share-Based Compensation

Prior to completion of the IPO, our board of directors adopted, and our stockholders approved, the Invitation Homes Inc. 2017 Omnibus Incentive Plan (the “Omnibus Incentive Plan”) to provide a means through which to attract and retain key personnel and to provide a means whereby our directors, officers, employees, consultants, and advisors can acquire and maintain an equity interest in us, or be paid incentive compensation, including incentive compensation measured by reference to the value of our common stock, and to align their interests with those of our stockholders. Under the Omnibus Incentive Plan, we may issue up to 16,000,000 shares of common stock.

Our share-based awards consist of time-vesting restricted stock units (“RSUs”), performance and market based vesting RSUs (“PRSUs”), and Outperformance Awards (defined below). Time-vesting RSUs are participating securities for EPS purposes, and PRSUs and Outperformance Awards are not. For detailed discussion of RSUs and PRSUs issued prior to January 1, 2020, refer to our Annual Report on Form 10-K for the year ended December 31, 2019.

Share-Based Awards

The following summarizes our share-based award activity during the nine months ended September 30, 2020.

Annual Long Term Incentive Plan (“LTIP”):

•Annual LTIP Awards Granted: During the nine months ended September 30, 2020, we granted 499,228 RSUs pursuant to LTIP awards (together with previously granted annual LTIP awards, “LTIP Awards”). Each award includes components which vest based on time-vesting conditions, market based vesting conditions, and performance based vesting conditions, each of which is subject to continued employment through the applicable vesting date. The time-vesting RSUs granted during the nine months ended September 30, 2020 vest in three equal annual installments based on an anniversary date of March 1, 2020. The PRSUs granted during the nine months ended September 30, 2020 may be earned based on the achievement of certain measures over a three year performance period that ends December 31, 2022. The number of PRSUs earned will be determined based on performance achieved during the performance period for each measure at certain threshold, target, or maximum levels and corresponding payout ranges. In general, the LTIP PRSUs are earned after the end of the performance

period on the date on which the performance results are certified by our compensation and management development committee (the “Compensation Committee”).

All of the LTIP Awards are subject to certain change in control and retirement eligibility provisions that may impact these vesting schedules.

•PRSU Results: In February 2020, the Compensation Committee certified performance achievement with respect to Tranche 3 of our 2017 LTIP Awards. Certain PRSUs vested and achieved performance in excess of the target level, resulting in the issuance of an additional 91,200 shares of common stock. Such awards are reflected as an increase in the number of awards granted and vested in the table below. Certain other PRSUs did not achieve performance criteria, resulting in the cancellation of 5,348 awards. Such awards are reflected as an increase in the number of awards forfeited/canceled in the table below.

Director Awards

During the nine months ended September 30, 2020, we granted 58,690 time-vesting RSUs to members of our board of directors, which awards will fully vest on the date of INVH’s 2021 annual stockholders meeting, subject to continued service on the board of directors through such date.

Outperformance Awards

On May 1, 2019, the Compensation Committee approved one-time equity based awards with market based vesting conditions in the form of PRSUs and OP Units (the “Outperformance Awards”). The Outperformance Awards may be earned based on the achievement of rigorous absolute total shareholder return and relative total shareholder return thresholds over a three year performance period ending on March 31, 2022. Upon completion of the performance period, the dollar value of the awards earned under the absolute and relative total shareholder return components will be separately calculated, and the number of earned Outperformance Awards will be determined based on the earned dollar value of the awards and the stock price at the performance certification date. Earned awards will vest 50% on March 31, 2022 and 25% on each of the first and second anniversaries of such date, subject to continued employment. The current aggregate $12,390 grant-date fair value of the Outperformance Awards still outstanding was determined based on Monte-Carlo option pricing models which estimate the probability of the vesting conditions being satisfied.

Summary of Total Share-Based Awards

The following table summarizes activity related to non-vested time-vesting RSUs and PRSUs, other than Outperformance Awards, during the nine months ended September 30, 2020:

	Time-Vesting Awards			PRSUs			Total Share-Based Awards(1)
	Number	Weighted Average Grant Date Fair Value (Actual $)		Number	Weighted Average Grant Date Fair Value (Actual $)		Number	Weighted Average Grant Date Fair Value (Actual $)
Balance, December 31, 2019	685,069	$	22.48	925,076	$	23.13	1,610,145	$	22.86
Granted	225,760	28.25		423,358	29.73		649,118	29.21
Vested(2)	(293,481)	(22.97)		(152,967)	(22.25)		(446,448)	(22.72)
Forfeited / canceled	(9,810)	(25.54)		(22,060)	(23.48)		(31,870)	(24.11)
Balance, September 30, 2020	607,538	$	24.34	1,173,407	$	25.62	1,780,945	$	25.18

(1)Total share-based awards excludes Outperformance Awards.

(2)All vested share-based awards are included in basic EPS for the periods after each award’s vesting date. The estimated fair value of share-based awards that fully vested during the nine months ended September 30, 2020 was $9,867. During the nine months ended September 30, 2020, 1,787 RSUs were accelerated pursuant to the terms and conditions of the Omnibus Incentive Plan and related award agreements.

Grant-Date Fair Values

The grant-date fair values of the time-vesting RSUs and PRSUs with performance condition vesting criteria are generally based on the closing price of our common stock on the grant date. However, the grant-date fair values for share-based awards with market condition vesting criteria are based on Monte-Carlo option pricing models. The following table summarizes the significant inputs utilized in these models for such awards granted during the nine months ended September 30, 2020:

	For the Nine Months Ended September 30,
Expected volatility(1)	17.2	%	—	17.3%
Risk-free rate	0.85%
Expected holding period (years)	2.09		—	2.84

(1)Expected volatility was estimated based on the historical volatility of INVH’s realized returns and the applicable index.

Summary of Total Share-Based Compensation Expense

During the three and nine months ended September 30, 2020 and 2019, we recognized share-based compensation expense as follows:

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2020		2019		2020		2019
General and administrative	$	4,833	$	3,818	$	9,760	$	11,533
Property management expense	1,253		807		2,533		2,314
Total	$	6,086	$	4,625	$	12,293	$	13,847

As of September 30, 2020, there is $23,401 of unrecognized share-based compensation expense related to non-vested share-based awards which is expected to be recognized over a weighted average period of 1.90 years.

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Fair Value Measurements

9 Months Ended

Sep. 30, 2020

Fair Value Disclosures [Abstract]

Fair Value Measurements

Note 11—Fair Value Measurements

The carrying amounts of restricted cash, certain components of other assets, accounts payable and accrued expenses, resident security deposits, and certain components of other liabilities approximate fair value due to the short maturity of these amounts. Our interest rate swap agreements and interest rate cap agreements are the only financial instruments recorded at fair value on a recurring basis within our condensed consolidated financial statements. The fair values of our interest rate caps and swaps, which are classified as Level 2 in the fair value hierarchy, are estimated using market values of instruments with similar attributes and maturities. See Note 7 for the details of the condensed consolidated balance sheet classification and the fair values for the interest rate caps and swaps.

Recurring Fair Value Measurements

The following table displays the carrying values and fair values of financial instruments as of September 30, 2020 and December 31, 2019:

		September 30, 2020				December 31, 2019
		Carrying Value		Fair Value		Carrying Value		Fair Value
Assets carried at historical cost on the condensed consolidated balance sheets:
Investments in debt securities(1)	Level 2	$	309,122	$	312,661	$	316,991	$	318,299
Liabilities carried at historical cost on the condensed consolidated balance sheets:
Mortgage loans(2)	Level 2	$	6,108,880	$	6,181,214	$	6,266,407	$	6,292,261
Secured Term Loan(3)	Level 3	403,363		461,617		403,464		411,213
Term Loan Facility(4)	Level 3	1,500,000		1,499,446		1,500,000		1,500,444
Convertible Senior Notes(5)	Level 3	338,112		352,103		334,299		346,489

(1)The carrying values of investments in debt securities are shown net of discount.

(2)The carrying values of the mortgage loans are shown net of discount and exclude $13,900 and $27,946 of deferred financing costs as of September 30, 2020 and December 31, 2019, respectively.

(3)The carrying value of the Secured Term Loan excludes $2,323 and $2,486 of deferred financing costs as of September 30, 2020 and December 31, 2019, respectively.

(4)The carrying value of the Term Loan Facility excludes $4,087 and $6,253 of deferred financing costs as of September 30, 2020 and December 31, 2019, respectively.

(5)The carrying values of the Convertible Senior Notes include unamortized discounts of $6,888 and $10,701 as of September 30, 2020 and December 31, 2019, respectively.

The fair values of our investment in debt securities and mortgage loans, which are classified as Level 2 in the fair value hierarchy, are estimated based on market bid prices of comparable instruments at the end of the period. The following table displays the significant unobserverable inputs used to develop our Level 3 fair value measurements as of September 30, 2020:

	Quantitative Information about Level 3 Fair Value Measurement(1)
	Fair Value		Valuation Technique	Unobservable Input	Rate
Secured Term Loan	$	461,617	Discounted Cash Flow	Effective Rate	2.08%
Term Loan Facility	1,499,446		Discounted Cash Flow	Effective Rate	1.88	%	—	1.91%
Convertible Senior Notes	352,103		Discounted Cash Flow	Effective Rate	1.88%

(1)Our Level 3 fair value instruments require interest only monthly payments.

Nonrecurring Fair Value Measurements

Our assets measured at fair value on a nonrecurring basis are those assets for which we have recorded impairments.

Single-Family Residential Properties

The single-family residential properties for which we have recorded impairments, measured at fair value on a nonrecurring basis, are summarized below:

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2020		2019		2020		2019
Investments in single-family residential properties, net held for use (Level 3):
Pre-impairment amount	$	—	$	885	$	451	$	8,438
Total impairments	—		(254)		(89)		(2,072)
Fair value	$	—	$	631	$	362	$	6,366

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2020		2019		2020		2019
Investments in single-family residential properties, net held for sale (Level 3):
Pre-impairment amount	$	1,800	$	18,723	$	19,594	$	49,837
Total impairments	(289)		(3,706)		(4,113)		(9,217)
Fair value	$	1,511	$	15,017	$	15,481	$	40,620

For additional information related to our single-family residential properties as of September 30, 2020 and December 31, 2019, refer to Note 3.

ROU Lease Assets

During the three months ended September 30, 2020, we relocated one of our corporate offices and vacated the former location. As of September 30, 2020, the expected undiscounted sublease payments through the remaining original lease term of the vacated office space no longer exceed the carrying value of the related ROU lease asset, and we concluded that the ROU lease asset was not fully recoverable. During the three and nine months ended September 30, 2020, we recorded impairment of $1,750 in other, net in the condensed consolidated statements of operations. The fair value of the ROU lease asset measured at fair value on a nonrecurring basis, which is classified as Level 3 in the fair value hierarchy, was determined based on a discounted cash flow analysis reflective of the income expected from a sublease. For additional information related to our ROU lease assets as of September 30, 2020 and December 31, 2019, refer to Note 5.

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Earnings per Share

9 Months Ended

Sep. 30, 2020

Earnings Per Share [Abstract]

Earnings per Share

Note 12—Earnings per Share

Basic and diluted EPS are calculated as follows:

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2020		2019		2020		2019
(in thousands, except share and per share data)
Numerator:
Net income available to common stockholders — basic and diluted	$	32,540	$	33,616	$	125,178	$	93,165
Denominator:
Weighted average common shares outstanding — basic	560,598,995		537,771,245		550,722,684		528,209,033
Effect of dilutive securities:
Incremental shares attributed to non-vested share-based awards	1,272,378		873,643		1,224,594		951,320
Weighted average common shares outstanding — diluted	561,871,373		538,644,888		551,947,278		529,160,353
Net income per common share — basic	$	0.06	$	0.06	$	0.23	$	0.18
Net income per common share — diluted	$	0.06	$	0.06	$	0.23	$	0.18

Incremental shares attributed to non-vested share-based awards are excluded from the computation of diluted EPS when they are anti-dilutive. For the three and nine months ended September 30, 2020, 153,114 and 120,835 incremental shares attributed to non-vested share-based awards, respectively, are excluded from the denominator as their inclusion would have been anti-dilutive. For the nine months ended September 30, 2019, 376 incremental shares attributed to non-vested share-based awards are excluded from the denominator as their inclusion would have been anti-dilutive. For the three months ended September 30, 2019, all incremental shares attributed to non-vested share-based awards were included in the denominator.

For the three and nine months ended September 30, 2020 and 2019, the vested OP Units have been excluded from the computation of EPS because all income attributable to the OP Units has been recorded as non-controlling interest and thus excluded from net income available to common stockholders.

For the nine months ended September 30, 2019, using the “if-converted” method, 8,323,258 potential shares of common stock for the 2019 Convertible Notes for the period prior to conversion are excluded from the computation of diluted EPS as they are anti-dilutive. For the three and nine months ended September 30, 2020 and 2019, 15,100,443 potential shares of common stock issuable upon the conversion of the 2022 Convertible Notes are also excluded from the computation of diluted EPS as they are anti-dilutive. Additionally, no adjustment to the numerator is required for interest expense related to the Convertible Senior Notes for the three and nine months ended September 30, 2020 and 2019. See Note 6 for further discussion about the Convertible Senior Notes.

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Income Tax

9 Months Ended

Sep. 30, 2020

Income Tax Disclosure [Abstract]

Income Tax

Note 13—Income Tax

We account for income taxes under the asset and liability method. For our taxable REIT subsidiaries (“TRSs”), deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using the enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. We provide a valuation allowance, from time to time, for deferred tax assets for which we do not consider realization of such assets to be more likely than not.

As of September 30, 2020 and December 31, 2019, we have not recorded any deferred tax assets and liabilities or unrecognized tax benefits. We do not anticipate a significant change in unrecognized tax benefits within the next 12 months.

We have sold assets that were either subject to Section 337(d) of the Internal Revenue Code of 1986, as amended, or were held by TRSs. These transactions resulted in $293 and $576 of current income tax expense for the three months ended September 30, 2020 and 2019, respectively, and $722 and $2,181 of current income tax expense for the nine months ended September 30, 2020 and 2019, which has been recorded in gain on sale of property, net of tax in the condensed consolidated statements of operations.

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Commitments and Contingencies

9 Months Ended

Sep. 30, 2020

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Note 14—Commitments and Contingencies

Lease Commitments

The following table sets forth our fixed lease payment commitments as a lessee as of September 30, 2020, for the periods below:

Year	Operating Leases		Finance Leases
Remainder of 2020	$	1,219	$	792
2021	4,840		3,109
2022	3,846		2,526
2023	2,858		2,475
2024	2,500		714
Thereafter	1,096		—
Total lease payments	16,359		9,616
Less: imputed interest	(1,169)		(637)
Total lease liability	$	15,190	$	8,979

The components of lease expense for the three and nine months ended September 30, 2020 and 2019 are as follows:

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2020		2019		2020		2019
Operating lease cost:
Fixed lease cost	$	1,106	$	1,140	$	3,257	$	3,037
Variable lease cost	263		323		860		1,022
Total operating lease cost	$	1,369	$	1,463	$	4,117	$	4,059
Finance lease cost:
Amortization of ROU assets	$	707	$	137	$	1,628	$	374
Interest on lease liabilities	101		22		371		40
Total finance lease cost	$	808	$	159	$	1,999	$	414

Insurance Policies

Pursuant to the terms of certain of our loan agreements (see Note 6), laws and regulations of the jurisdictions in which our properties are located, and general business practices, we are required to procure insurance on our properties. As of September 30, 2020, there are no material contingent liabilities related to uninsured losses with respect to our properties.

Legal Matters

We are subject to various legal proceedings and claims that arise in the ordinary course of our business. We accrue a liability when we believe that it is both probable that a liability has been incurred and that we can reasonably estimate the amount of the loss. We do not believe that the final outcome of these proceedings or matters will have a material adverse effect on our condensed consolidated financial statements.

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Subsequent Events

Oct. 06, 2020

Subsequent Events [Abstract]

Subsequent Events

Note 15—Subsequent Events

In connection with the preparation of the accompanying condensed consolidated financial statements, we have evaluated events and transactions occurring after September 30, 2020, for potential recognition or disclosure.

Joint Venture with Rockpoint

On October 6, 2020, we entered into an agreement with Rockpoint Group, L.L.C. (“Rockpoint”) to form a joint venture partnership that will acquire single-family homes to operate as rental residences. The joint venture will be capitalized with a total equity commitment of $375,000, of which $75,000 (20%) will be committed by us and $300,000 (80%) will be committed by Rockpoint. We will provide investment, asset management, and property management services to the joint venture, will earn asset management and property management fees, and have the opportunity to earn a promoted interest subject to certain performance thresholds.

Acquisition of Single-family Residential Properties

In October 2020, we completed two bulk acquisitions for a total of 327 single-family residential properties for $65,739.

Extensions of Existing Mortgage Loans

On October 1, 2020, we submitted a notification to request an extension of the maturity date of the IH 2018-4 mortgage loan from January 9, 2021 to January 9, 2022.

On October 9, 2020, the extension of the maturity date of the SWH 2017-1 mortgage loan from October 9, 2020 to October 9, 2021 was approved by the lender.

Dividend Declaration

On October 22, 2020, our board of directors declared a dividend of $0.15 per share to stockholders of record on November 10, 2020, which is payable on November 25, 2020.

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Significant Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2020

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation

The accompanying interim condensed consolidated financial statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and with the rules and regulations of the Securities and Exchange Commission for interim financial information and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements and should be read in conjunction with our audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2019.

These condensed consolidated financial statements include the accounts of INVH and its consolidated subsidiaries. All intercompany accounts and transactions have been eliminated in the condensed consolidated financial statements. In the opinion of management, all adjustments that are of a normal recurring nature considered necessary for a fair presentation of our interim financial statements have been included in these condensed consolidated financial statements. Operating results for the nine months ended September 30, 2020 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2020.

We consolidate entities when we own, directly or indirectly, a majority interest in the entity or are otherwise able to control the entity. We consolidate variable interest entities (“VIEs”) in accordance with ASC 810, Consolidation, if we are the primary beneficiary of the VIE as determined by our power to direct the VIE’s activities and the obligation to absorb its losses or the right to receive its benefits, which are potentially significant to the VIE. A VIE is broadly defined as an entity with one or more of the following characteristics: (a) the total equity investment at risk is insufficient to finance the entity’s activities without additional subordinated financial support; (b) as a group, the holders of the equity investment at risk lack (i) the ability to make decisions about the entity’s activities through voting or similar rights, (ii) the obligation to absorb the expected losses of the entity, or (iii) the right to receive the expected residual returns of the entity; or (c) the equity investors have voting rights that are not proportional to their economic interests, and substantially all of the entity’s activities either involve, or are conducted on behalf of, an investor that has disproportionately few voting rights.

As described in Note 5, we have an investment in a joint venture with the Federal National Mortgage Association (“FNMA”), which is a voting interest entity. We do not hold a controlling financial interest in the joint venture but have significant influence over its operating and financial policies. Additionally, FNMA holds certain substantive participating rights that preclude the presumption of control by us; as such, we account for our investment using the equity method. In connection with the Mergers, we initially recorded this investment at fair value in connection with purchase accounting and have subsequently adjusted for our proportionate share of net earnings or losses and other comprehensive income or loss, cash contributions made and distributions received, and other adjustments, as appropriate. Distributions of operating profit from the joint venture are reported as part of operating cash flows while distributions related to a capital transaction, such as a refinancing transaction or sale, are reported as investing activities.

Non-controlling interests represent the OP Units not owned by INVH, including any vested OP Units granted in connection with certain share-based compensation awards. Non-controlling interests are presented as a separate component of equity on the condensed consolidated balance sheets as of September 30, 2020 and December 31, 2019, and the condensed consolidated statements of operations for the three and nine months ended September 30, 2020 include an allocation of the net income attributable to the non-controlling interest holders. Vested OP Units are redeemable for shares of our common stock on a one-for-one basis or, in our sole discretion, cash, and redemptions of OP Units are accounted for as a reduction in non-controlling interests with an offset to stockholders’ equity based on the pro rata number of OP Units redeemed.

Adoption of New Accounting Standards and Recent Accounting Pronouncements

Adoption of New Accounting Standards

In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which changes how companies measure credit losses for certain financial assets, excluding receivables arising from operating leases. This guidance requires an entity to estimate its expected credit loss and record an allowance based on this estimate so that it is presented at the net amount expected to be collected on the financial asset. We adopted this standard as of January 1, 2020, and it did not have a material impact on our condensed consolidated financial statements.

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848) (“ASU 2020-04”), which contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives, and other contracts. The guidance in ASU 2020-04 is optional and may be elected over time as reference rate reform activities occur. We have elected to apply the hedge accounting expedients related to probability and the assessments of effectiveness for future London Interbank Offer Rate (“LIBOR”) indexed cash flows to assume that the index upon which future hedged transactions will be based matches the index on the corresponding derivatives. Application of these expedients preserves the presentation of derivatives consistent with past presentation. We continue to evaluate the impact of the guidance and may apply other elections as applicable as additional changes in the market occur.

In April 2020, the FASB staff issued a question and answer document (the “Lease Modification Q&A”) focused on the application of lease accounting guidance to lease accommodations resulting from the COVID-19 pandemic as many lessors have been asked to provide rent deferrals, rent abatements, late fee waivers, and other lease concessions to lessees (collectively, “lease accommodations”). While the lease modification guidance in ASC 842, Leases, addresses routine changes to lease terms resulting from negotiations between a lessee and lessor, it did not contemplate the rapid implementation of lease accommodations to address the sudden liquidity constraints of some lessees arising from the COVID-19 pandemic.

Under existing lease guidance, we would have been required to determine, on a lease by lease basis, if each lease accommodation resulted from a new arrangement reached with the resident (treated within the lease modification accounting framework) or if each was contemplated under the enforceable rights and obligations within the existing lease agreement (precluded from applying the lease modification accounting framework). If certain criteria are met, the Lease Modification Q&A allows lessors to bypass the lease by lease analysis and instead elect to either apply the lease modification accounting framework or not, with such election applied consistently to leases with similar characteristics and similar circumstances. We elected to apply the Lease Modification Q&A guidance not to perform a lease by lease analysis with respect to any lease accommodations and to account for such accommodations outside of the lease modification framework. The Lease Modification Q&A has not had a material impact on our condensed consolidated financial statements for the three and nine months ended September 30, 2020. However, the extent of lease accommodations granted to residents as a result of the COVID-19 pandemic in future periods may materially affect our condensed consolidated financial statements.

Recent Accounting Pronouncements

In August 2020, the FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”), which simplifies an issuer’s accounting for convertible instruments and contracts in its own equity. The guidance reduces the number of accounting models for convertible instruments, requires entities to use the “if-converted” method in diluted earnings (loss) per share (“EPS”), and requires that the effect of potential share settlement be included in the diluted EPS calculation when an instrument may be settled in cash or shares. The new standard will be effective for annual reporting periods beginning after December 15, 2021, and interim periods within that reporting period, with early adoption permitted beginning after December 15, 2020 and interim periods within that reporting period. Our 2022 Convertible Notes (as defined in Note 6) are the only instruments we have that will be subject to ASU 2020-06, and these notes mature on January 15, 2022. As such, ASU 2020-06 will not materially affect our condensed consolidated financial statements.

Use of Estimates

Use of Estimates

The preparation of the condensed consolidated financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements, as well as the reported amounts of revenues and expenses during the reporting periods. These estimates are inherently subjective in nature and actual results could differ from those estimates.

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Investments in Single-Family Residential Properties (Tables)

9 Months Ended

Sep. 30, 2020

Real Estate [Abstract]

Schedule of property carrying amount

The following table sets forth the net carrying amount associated with our properties by component:

	September 30, 2020		December 31, 2019
Land	$	4,501,831	$	4,499,346
Single-family residential property	13,386,936		13,121,179
Capital improvements	511,034		513,269
Equipment	113,359		113,370
Total gross investments in the properties	18,513,160		18,247,164
Less: accumulated depreciation	(2,381,059)		(2,003,972)
Investments in single-family residential properties, net	$	16,132,101	$	16,243,192

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Cash, Cash Equivalents, and Restricted Cash (Tables)

9 Months Ended

Sep. 30, 2020

Cash and Cash Equivalents [Abstract]

Schedule of cash and cash equivalents

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

	September 30, 2020		December 31, 2019
Cash and cash equivalents	$	559,567	$	92,258
Restricted cash	249,341		193,987
Total cash, cash equivalents, and restricted cash shown in the condensed consolidated statements of cash flows	$	808,908	$	286,245

Schedule of restricted cash

The balances of our restricted cash accounts, as of September 30, 2020 and December 31, 2019, are set forth in the table below. As of September 30, 2020 and December 31, 2019, no amounts were funded to the insurance accounts as the conditions specified in the mortgage loan and Secured Term Loan agreements that require such funding did not exist.

	September 30, 2020		December 31, 2019
Resident security deposits	$	156,207	$	148,186
Property taxes	57,296		10,443
Collections	24,642		24,034
Capital expenditures	5,628		5,627
Letters of credit	3,319		3,459
Special and other reserves	2,249		2,238
Total	$	249,341	$	193,987

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Other Assets (Tables)

9 Months Ended

Sep. 30, 2020

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

Schedule of other assets

As of September 30, 2020 and December 31, 2019, the balances in other assets, net are as follows:

	September 30, 2020		December 31, 2019
Investments in debt securities, net	$	309,122	$	316,991
Investment in unconsolidated joint venture	53,756		54,778
Held for sale assets(1)	50,685		116,529
Rent and other receivables, net	36,540		25,244
Prepaid expenses	27,396		32,106
ROU lease assets — operating and finance, net	21,510		13,768
Investments in equity securities	16,734		16,650
Corporate fixed assets, net	8,809		9,825
Deferred leasing costs, net	7,985		7,427
Amounts deposited and held by others	5,863		1,348
Deferred financing costs, net	987		2,765
Derivative instruments (Note 7)	1		1,643
Other	12,183		6,192
Total	$	551,571	$	605,266

(1)As of September 30, 2020 and December 31, 2019, 211 and 478 properties, respectively, are classified as held for sale.

Schedule of supplemental information related to leases

The following table presents supplemental information related to leases into which we have entered as a lessee as of September 30, 2020 and December 31, 2019:

	September 30, 2020						December 31, 2019
	Operating Leases			Finance Leases			Operating Leases			Finance Leases
Other assets	$	12,112		$	9,398		$	12,552		$	1,216
Other liabilities (Note 14)	15,190			8,979			13,787			1,210
Weighted average remaining lease term	3.9 years			3.3 years			3.8 years			2.0 years
Weighted average discount rate	3.7		%	4.0		%	4.0		%	4.0		%

Lease Payments to be Received

Future minimum rental revenues and other property income under leases existing on our single-family residential properties as of September 30, 2020 are as follows:

Year	Lease Payments to be Received
Remainder of 2020	$	401,730
2021	751,863
2022	81,892
2023	—
2024	—
Thereafter	—
Total	$	1,235,485

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Debt (Tables)

9 Months Ended

Sep. 30, 2020

Debt Instrument [Line Items]

Schedule of convertible debt

The following table summarizes the terms of the Convertible Senior Notes outstanding as of September 30, 2020 and December 31, 2019:

						Principal Amount
	Coupon Rate	Effective Rate(1)	Conversion Rate(2)	Maturity Date	Remaining Amortization Period	September 30, 2020		December 31, 2019
2022 Convertible Notes	3.50%	5.12%	43.7694	January 15, 2022	1.29 years	$	345,000	$	345,000
Net unamortized fair value adjustment						(6,888)		(10,701)
Total						$	338,112	$	334,299

(1)Effective rate includes the effect of the adjustment to the fair value of the debt as of the Merger Date, the value of which reduced the initial liability recorded to $324,252 for the 2022 Convertible Notes.

(2)The conversion rate as of September 30, 2020 represents the number of shares of common stock issuable per $1,000 principal amount (actual $) of the 2022 Convertible Notes converted on such date, as adjusted in accordance with the indenture as a result of cash dividend payments and the effects of previous mergers. As of September 30, 2020, the 2022 Convertible Notes do not meet the criteria for conversion. We have the option to settle the 2022 Convertible Notes in cash, common stock, or a combination thereof.

Schedule of credit facility

The following table sets forth a summary of the outstanding principal amounts under the Credit Facility as of September 30, 2020 and December 31, 2019:

	Maturity Date	Interest Rate(1)	September 30, 2020		December 31, 2019
Term Loan Facility	February 6, 2022	1.85%	$	1,500,000	$	1,500,000
Deferred financing costs, net			(4,087)		(6,253)
Term Loan Facility, net			$	1,495,913	$	1,493,747
Revolving Facility(2)	February 6, 2021	1.90%	$	—	$	—

(1)Interest rates for the Term Loan Facility and the Revolving Facility are based on LIBOR plus an applicable margin. As of September 30, 2020, the applicable margins were 1.70% and 1.75%, respectively, and LIBOR was 0.15%.

(2)If we exercise the one year extension option, the maturity date will be February 6, 2022.

Schedule of maturities of long-term debt

The following table summarizes the contractual maturities of our debt as of September 30, 2020:

Year	Mortgage Loans(1)(2)		Secured Term Loan		Term Loan Facility		Revolving Facility(3)		Convertible Senior Notes		Total
Remainder of 2020	$	1,346,809	$	—	$	—	$	—	$	—	$	1,346,809
2021	3,767,372		—		—		—		—		3,767,372
2022	—		—		1,500,000		—		345,000		1,845,000
2023	—		—		—		—		—		—
2024	—		—		—		—		—		—
Thereafter	994,699		403,363		—		—		—		1,398,062
Total	6,108,880		403,363		1,500,000		—		345,000		8,357,243
Less: deferred financing costs, net	(13,900)		(2,323)		(4,087)		—		—		(20,310)
Less: unamortized fair value adjustment	—		—		—		—		(6,888)		(6,888)
Total	$	6,094,980	$	401,040	$	1,495,913	$	—	$	338,112	$	8,330,045

(1)The maturity dates of the obligations are reflective of all extensions that have been exercised as of September 30, 2020. If fully extended, we would have no mortgage loans maturing before 2023. Such extensions are available provided there is no continuing event of default under the respective mortgage loan agreement and the Borrower Entity obtains and delivers a replacement interest rate cap agreement from an approved counterparty within the required timeframe to the lender.

(2)On September 2, 2020, we submitted a notification to request an extension of the maturity of the IH 2017-2 mortgage loan from December 9, 2020 to December 9, 2021. Additionally, on October 9, 2020, the extension of the maturity date of the SWH 2017-1 mortgage loan from October 9, 2020 to October 9, 2021 was approved by the lender, and on October 1, 2020, we submitted a notification to request an extension of the maturity date of the IH 2018-4 mortgage loan from January 9, 2021 to January 9, 2022 (see Note 15).

(3)If we exercise the one year extension option, the maturity date will be in 2022.

Mortgage Loans

Debt Instrument [Line Items]

Schedule of long-term debt instruments

The following table sets forth a summary of our mortgage loan indebtedness as of September 30, 2020 and December 31, 2019:

						Outstanding Principal Balance(5)
	Origination Date	Maturity Date(1)	Maturity Date if Fully Extended(2)	Interest Rate(3)	Range of Spreads(4)	September 30, 2020		December 31, 2019
IH 2017-1(6)	April 28, 2017	June 9, 2027	June 9, 2027	4.23%	N/A	$	994,699	$	995,520
SWH 2017-1(7)(8)	September 29, 2017	October 9, 2020	January 9, 2023	1.72%	102-347 bps	732,778		744,092
IH 2017-2(7)(9)	November 9, 2017	December 9, 2020	December 9, 2024	1.30%	91-186 bps	614,031		624,475
IH 2018-1(7)	February 8, 2018	March 9, 2021	March 9, 2025	1.27%	76-206 bps	775,118		793,720
IH 2018-2(7)	May 8, 2018	June 9, 2021	June 9, 2025	1.49%	95-230 bps	928,939		957,135
IH 2018-3(7)	June 28, 2018	July 9, 2021	July 9, 2025	1.50%	105-230 bps	1,138,876		1,213,035
IH 2018-4(7)(10)	November 7, 2018	January 9, 2021	January 9, 2026	1.57%	115-225 bps	924,439		938,430
Total Securitizations						6,108,880		6,266,407
Less: deferred financing costs, net						(13,900)		(27,946)
Total						$	6,094,980	$	6,238,461

(1)The maturity dates above reflect all extension options that have been exercised.

(2)Represents the maturity date if we exercise each of the remaining one year extension options available, which are subject to certain conditions being met.

(3)Except for IH 2017-1, interest rates are based on a weighted average spread over LIBOR (or a comparable or successor rate as provided for in our loan agreements), plus applicable servicing fees; as of September 30, 2020, LIBOR was 0.15%. Our IH 2017-1 mortgage loan bears interest at a fixed rate of 4.23% per annum, equal to the market determined pass-through rate payable on the certificates including applicable servicing fees.

(4)Range of spreads is based on outstanding principal balances as of September 30, 2020.

(5)Outstanding principal balance is net of discounts and does not include deferred financing costs, net.

(6)Net of unamortized discount of $2,377 and $2,641 as of September 30, 2020 and December 31, 2019, respectively.

(7)The initial maturity term of each of these mortgage loans is two years, individually subject to three to five, one year extension options at the Borrower Entity’s discretion (provided that there is no continuing event of default under the mortgage loan agreement and the Borrower Entity obtains and delivers a replacement interest rate cap agreement from an approved counterparty within the required timeframe to the lender). Our SWH 2017-1, IH 2017-2, IH 2018-1, IH 2018-2 and IH 2018-3 mortgage loans have exercised the first extension option. The maturity dates above reflect all extensions that have been exercised.

(8)On October 9, 2020, the extension of the maturity date of the SWH 2017-1 mortgage loan from October 9, 2020 to October 9, 2021 was approved by the lender (see Note 15).

(9)On September 2, 2020, we submitted a notification to request an extension of the maturity of the IH 2017-2 mortgage loan from December 9, 2020 to December 9, 2021.

(10)On October 1, 2020, we submitted a notification to request an extension of the maturity date of the IH 2018-4 mortgage loan from January 9, 2021 to January 9, 2022 (see Note 15).

Secured Term Loan

Debt Instrument [Line Items]

Schedule of long-term debt instruments

The following table sets forth a summary of our Secured Term Loan indebtedness as of September 30, 2020 and December 31, 2019:

	Maturity Date	Interest Rate(1)	September 30, 2020		December 31, 2019
Secured Term Loan	June 9, 2031	3.59%	$	403,363	$	403,464
Deferred financing costs, net			(2,323)		(2,486)
Secured Term Loan, net			$	401,040	$	400,978

(1)The Secured Term Loan bears interest at a fixed rate of 3.59% per annum including applicable servicing fees for the first 11 years and for the twelfth year bears interest at a floating rate based on a spread of 147 bps over one month LIBOR (or a comparable or successor rate as provided for in our loan agreement), including applicable servicing fees, subject to certain adjustments as outlined in the loan agreement. Interest payments are made monthly.

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Derivative Instruments (Tables)

9 Months Ended

Sep. 30, 2020

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Summary of interest rate swap instruments

The table below summarizes our interest rate swap instruments as of September 30, 2020:

Agreement Date	Forward Effective Date	Maturity Date	Strike Rate	Index	Notional Amount
December 21, 2016	February 28, 2017	January 31, 2022	1.97%	One month LIBOR	$	750,000
December 11, 2019	February 28, 2017	December 31, 2024	1.74%	One month LIBOR	750,000
April 19, 2018	January 31, 2019	January 31, 2025	2.86%	One month LIBOR	400,000
February 15, 2019	March 15, 2019	March 15, 2022	2.23%	One month LIBOR	800,000
April 19, 2018	March 15, 2019	November 30, 2024	2.85%	One month LIBOR	400,000
April 19, 2018	March 15, 2019	February 28, 2025	2.86%	One month LIBOR	400,000
January 10, 2017	January 15, 2020	January 15, 2021	2.13%	One month LIBOR	550,000
May 8, 2018	March 9, 2020	June 9, 2025	2.99%	One month LIBOR	325,000
May 8, 2018	June 9, 2020	June 9, 2025	2.99%	One month LIBOR	595,000
June 3, 2016	July 15, 2020	July 15, 2021	1.47%	One month LIBOR	450,000
June 28, 2018	August 7, 2020	July 9, 2025	2.90%	One month LIBOR	1,100,000
January 10, 2017	January 15, 2021	July 15, 2021	2.23%	One month LIBOR	550,000
December 9, 2019	July 15, 2021	November 30, 2024	2.90%	One month LIBOR	400,000
November 7, 2018	March 15, 2022	July 31, 2025	3.14%	One month LIBOR	400,000
November 7, 2018	March 15, 2022	July 31, 2025	3.16%	One month LIBOR	400,000

Summary of derivative financial instruments, fair value and location in consolidated balance sheets

The table below presents the fair value of our derivative financial instruments as well as their classification on the condensed consolidated balance sheets as of September 30, 2020 and December 31, 2019:

	Asset Derivatives					Liability Derivatives
		Fair Value as of					Fair Value as of
	Balance Sheet Location	September 30, 2020		December 31, 2019		Balance Sheet Location	September 30, 2020		December 31, 2019
Derivatives designated as hedging instruments:
Interest rate swaps	Other assets	$	—	$	1,643	Other liabilities	$	602,507	$	275,679
Derivatives not designated as hedging instruments:
Interest rate caps	Other assets	1		—		Other liabilities	—		—
Total		$	1	$	1,643		$	602,507	$	275,679

Summary of offsetting derivative assets

The tables below present a gross presentation, the effects of offsetting, and a net presentation of our derivatives as of September 30, 2020 and December 31, 2019:

	September 30, 2020
							Gross Amounts Not Offset in the Statement of Financial Position
	Gross Amounts of Recognized Assets/ Liabilities		Gross Amounts Offset in the Statement of Financial Position		Net Amounts of Assets/ Liabilities Presented in the Statement of Financial Position		Financial Instruments		Cash Collateral Received		Net Amount
Offsetting assets:
Derivatives	$	1	$	—	$	1	$	—	$	—	$	1
Offsetting liabilities:
Derivatives	$	602,507	$	—	$	602,507	$	—	$	—	$	602,507

	December 31, 2019
							Gross Amounts Not Offset in the Statement of Financial Position
	Gross Amounts of Recognized Assets/ Liabilities		Gross Amounts Offset in the Statement of Financial Position		Net Amounts of Assets/ Liabilities Presented in the Statement of Financial Position		Financial Instruments		Cash Collateral Received		Net Amount
Offsetting assets:
Derivatives	$	1,643	$	—	$	1,643	$	(1,054)	$	—	$	589
Offsetting liabilities:
Derivatives	$	275,679	$	—	$	275,679	$	(1,054)	$	—	$	274,625

Summary of offsetting derivative liabilities

The tables below present a gross presentation, the effects of offsetting, and a net presentation of our derivatives as of September 30, 2020 and December 31, 2019:

	September 30, 2020
							Gross Amounts Not Offset in the Statement of Financial Position
	Gross Amounts of Recognized Assets/ Liabilities		Gross Amounts Offset in the Statement of Financial Position		Net Amounts of Assets/ Liabilities Presented in the Statement of Financial Position		Financial Instruments		Cash Collateral Received		Net Amount
Offsetting assets:
Derivatives	$	1	$	—	$	1	$	—	$	—	$	1
Offsetting liabilities:
Derivatives	$	602,507	$	—	$	602,507	$	—	$	—	$	602,507

	December 31, 2019
							Gross Amounts Not Offset in the Statement of Financial Position
	Gross Amounts of Recognized Assets/ Liabilities		Gross Amounts Offset in the Statement of Financial Position		Net Amounts of Assets/ Liabilities Presented in the Statement of Financial Position		Financial Instruments		Cash Collateral Received		Net Amount
Offsetting assets:
Derivatives	$	1,643	$	—	$	1,643	$	(1,054)	$	—	$	589
Offsetting liabilities:
Derivatives	$	275,679	$	—	$	275,679	$	(1,054)	$	—	$	274,625

Derivative Instruments, Gain (Loss)

The tables below present the effect of our derivative financial instruments in the condensed consolidated statements of comprehensive income (loss) and the condensed consolidated statements of operations for the three months ended September 30, 2020 and 2019:

	Amount of Loss Recognized in OCI on Derivative				Location of Gain (Loss) Reclassified from Accumulated OCI into Net Income	Amount of Gain (Loss) Reclassified from Accumulated OCI into Net Income				Total Amount of Interest Expense Presented in the Condensed Consolidated Statements of Operations
	For the Three Months Ended September 30,					For the Three Months Ended September 30,				For the Three Months Ended September 30,
	2020		2019			2020		2019		2020		2019
Derivatives in cash flow hedging relationships:
Interest rate swaps	$	(4,171)	$	(71,729)	Interest expense	$	(37,557)	$	4,272	$	87,713	$	89,067

	Location of Loss Recognized in Net Income on Derivative	Amount of Loss Recognized in Net Income on Derivative
		For the Three Months Ended September 30,
		2020		2019
Derivatives not designated as hedging instruments:
Interest rate caps	Interest expense	$	146	$	64

The tables below present the effect of our derivative financial instruments in the condensed consolidated statements of comprehensive income (loss) and the condensed consolidated statements of operations for the nine months ended September 30, 2020 and 2019:

	Amount of Loss Recognized in OCI on Derivative				Location of Gain (Loss) Reclassified from Accumulated OCI into Net Income	Amount of Gain (Loss) Reclassified from Accumulated OCI into Net Income				Total Amount of Interest Expense Presented in the Condensed Consolidated Statements of Operations
	For the Nine Months Ended September 30,					For the Nine Months Ended September 30,				For the Nine Months Ended September 30,
	2020		2019			2020		2019		2020		2019
Derivatives in cash flow hedging relationships:
Interest rate swaps	$	(398,426)	$	(308,196)	Interest expense	$	(74,166)	$	23,026	$	258,541	$	278,756

	Location of Loss Recognized in Net Income on Derivative	Amount of Loss Recognized in Net Income on Derivative
		For the Nine Months Ended September 30,
		2020		2019
Derivatives not designated as hedging instruments:
Interest rate caps	Interest expense	$	198	$	98

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Equity (Tables)

9 Months Ended

Sep. 30, 2020

Equity [Abstract]

Summary of dividends declared

The following table summarizes our dividends declared from January 1, 2019 through September 30, 2020:

	Record Date	Amount per Share		Pay Date	Total Amount Declared
Q3-2020	August 12, 2020	$	0.15	August 28, 2020	$	84,286
Q2-2020	May 13, 2020	0.15		May 29, 2020	81,916
Q1-2020	February 12, 2020	0.15		February 28, 2020	81,673
Q4-2019	November 13, 2019	0.13		November 27, 2019	70,693
Q3-2019	August 15, 2019	0.13		August 30, 2019	70,465
Q2-2019	May 15, 2019	0.13		May 31, 2019	68,334
Q1-2019	February 13, 2019	0.13		February 28, 2019	67,965

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Share-Based Compensation (Tables)

9 Months Ended

Sep. 30, 2020

Share-based Payment Arrangement [Abstract]

Schedule of share-based compensation, RSU and PRSU activity

The following table summarizes activity related to non-vested time-vesting RSUs and PRSUs, other than Outperformance Awards, during the nine months ended September 30, 2020:

	Time-Vesting Awards			PRSUs			Total Share-Based Awards(1)
	Number	Weighted Average Grant Date Fair Value (Actual $)		Number	Weighted Average Grant Date Fair Value (Actual $)		Number	Weighted Average Grant Date Fair Value (Actual $)
Balance, December 31, 2019	685,069	$	22.48	925,076	$	23.13	1,610,145	$	22.86
Granted	225,760	28.25		423,358	29.73		649,118	29.21
Vested(2)	(293,481)	(22.97)		(152,967)	(22.25)		(446,448)	(22.72)
Forfeited / canceled	(9,810)	(25.54)		(22,060)	(23.48)		(31,870)	(24.11)
Balance, September 30, 2020	607,538	$	24.34	1,173,407	$	25.62	1,780,945	$	25.18

(1)Total share-based awards excludes Outperformance Awards.

(2)All vested share-based awards are included in basic EPS for the periods after each award’s vesting date. The estimated fair value of share-based awards that fully vested during the nine months ended September 30, 2020 was $9,867. During the nine months ended September 30, 2020, 1,787 RSUs were accelerated pursuant to the terms and conditions of the Omnibus Incentive Plan and related award agreements.

Schedule of share-based payment awards valuation assumptions

The grant-date fair values of the time-vesting RSUs and PRSUs with performance condition vesting criteria are generally based on the closing price of our common stock on the grant date. However, the grant-date fair values for share-based awards with market condition vesting criteria are based on Monte-Carlo option pricing models. The following table summarizes the significant inputs utilized in these models for such awards granted during the nine months ended September 30, 2020:

	For the Nine Months Ended September 30,
Expected volatility(1)	17.2	%	—	17.3%
Risk-free rate	0.85%
Expected holding period (years)	2.09		—	2.84

(1)Expected volatility was estimated based on the historical volatility of INVH’s realized returns and the applicable index.

Schedule of compensation cost for share-based payment arrangements, allocation of share-based compensation costs by type

During the three and nine months ended September 30, 2020 and 2019, we recognized share-based compensation expense as follows:

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2020		2019		2020		2019
General and administrative	$	4,833	$	3,818	$	9,760	$	11,533
Property management expense	1,253		807		2,533		2,314
Total	$	6,086	$	4,625	$	12,293	$	13,847

As of September 30, 2020, there is $23,401 of unrecognized share-based compensation expense related to non-vested share-based awards which is expected to be recognized over a weighted average period of 1.90 years.

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Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2020

Fair Value Measurement Inputs and Valuation Techniques [Line Items]

Schedule of carrying values and fair values of financial instruments

The following table displays the carrying values and fair values of financial instruments as of September 30, 2020 and December 31, 2019:

		September 30, 2020				December 31, 2019
		Carrying Value		Fair Value		Carrying Value		Fair Value
Assets carried at historical cost on the condensed consolidated balance sheets:
Investments in debt securities(1)	Level 2	$	309,122	$	312,661	$	316,991	$	318,299
Liabilities carried at historical cost on the condensed consolidated balance sheets:
Mortgage loans(2)	Level 2	$	6,108,880	$	6,181,214	$	6,266,407	$	6,292,261
Secured Term Loan(3)	Level 3	403,363		461,617		403,464		411,213
Term Loan Facility(4)	Level 3	1,500,000		1,499,446		1,500,000		1,500,444
Convertible Senior Notes(5)	Level 3	338,112		352,103		334,299		346,489

(1)The carrying values of investments in debt securities are shown net of discount.

(2)The carrying values of the mortgage loans are shown net of discount and exclude $13,900 and $27,946 of deferred financing costs as of September 30, 2020 and December 31, 2019, respectively.

(3)The carrying value of the Secured Term Loan excludes $2,323 and $2,486 of deferred financing costs as of September 30, 2020 and December 31, 2019, respectively.

(4)The carrying value of the Term Loan Facility excludes $4,087 and $6,253 of deferred financing costs as of September 30, 2020 and December 31, 2019, respectively.

(5)The carrying values of the Convertible Senior Notes include unamortized discounts of $6,888 and $10,701 as of September 30, 2020 and December 31, 2019, respectively

Fair value measurement inputs and valuation techniques

The following table displays the significant unobserverable inputs used to develop our Level 3 fair value measurements as of September 30, 2020:

	Quantitative Information about Level 3 Fair Value Measurement(1)
	Fair Value		Valuation Technique	Unobservable Input	Rate
Secured Term Loan	$	461,617	Discounted Cash Flow	Effective Rate	2.08%
Term Loan Facility	1,499,446		Discounted Cash Flow	Effective Rate	1.88	%	—	1.91%
Convertible Senior Notes	352,103		Discounted Cash Flow	Effective Rate	1.88%

(1)Our Level 3 fair value instruments require interest only monthly payments.

Schedule of impaired assets, measured at fair value on a nonrecurring basis

Single-Family Residential Properties

The single-family residential properties for which we have recorded impairments, measured at fair value on a nonrecurring basis, are summarized below:

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2020		2019		2020		2019
Investments in single-family residential properties, net held for use (Level 3):
Pre-impairment amount	$	—	$	885	$	451	$	8,438
Total impairments	—		(254)		(89)		(2,072)
Fair value	$	—	$	631	$	362	$	6,366

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2020		2019		2020		2019
Investments in single-family residential properties, net held for sale (Level 3):
Pre-impairment amount	$	1,800	$	18,723	$	19,594	$	49,837
Total impairments	(289)		(3,706)		(4,113)		(9,217)
Fair value	$	1,511	$	15,017	$	15,481	$	40,620

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Earnings per Share (Tables)

9 Months Ended

Sep. 30, 2020

Earnings Per Share [Abstract]

Basic and diluted earnings per share calculation

Basic and diluted EPS are calculated as follows:

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2020		2019		2020		2019
(in thousands, except share and per share data)
Numerator:
Net income available to common stockholders — basic and diluted	$	32,540	$	33,616	$	125,178	$	93,165
Denominator:
Weighted average common shares outstanding — basic	560,598,995		537,771,245		550,722,684		528,209,033
Effect of dilutive securities:
Incremental shares attributed to non-vested share-based awards	1,272,378		873,643		1,224,594		951,320
Weighted average common shares outstanding — diluted	561,871,373		538,644,888		551,947,278		529,160,353
Net income per common share — basic	$	0.06	$	0.06	$	0.23	$	0.18
Net income per common share — diluted	$	0.06	$	0.06	$	0.23	$	0.18

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Commitments and Contingencies Commitments and Contingencies (Tables)

9 Months Ended

Sep. 30, 2020

Commitments and Contingencies Disclosure [Abstract]

Schedule of maturities of operating and finance leases liabilities

The following table sets forth our fixed lease payment commitments as a lessee as of September 30, 2020, for the periods below:

Year	Operating Leases		Finance Leases
Remainder of 2020	$	1,219	$	792
2021	4,840		3,109
2022	3,846		2,526
2023	2,858		2,475
2024	2,500		714
Thereafter	1,096		—
Total lease payments	16,359		9,616
Less: imputed interest	(1,169)		(637)
Total lease liability	$	15,190	$	8,979

Schedule of lease costs

The components of lease expense for the three and nine months ended September 30, 2020 and 2019 are as follows:

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2020		2019		2020		2019
Operating lease cost:
Fixed lease cost	$	1,106	$	1,140	$	3,257	$	3,037
Variable lease cost	263		323		860		1,022
Total operating lease cost	$	1,369	$	1,463	$	4,117	$	4,059
Finance lease cost:
Amortization of ROU assets	$	707	$	137	$	1,628	$	374
Interest on lease liabilities	101		22		371		40
Total finance lease cost	$	808	$	159	$	1,999	$	414

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Organization and Formation (Details) - $ / shares	Sep. 30, 2020	Dec. 31, 2019	Feb. 06, 2017
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Common Stock, Shares Authorized	9,000,000,000	9,000,000,000	9,000,000,000
Preferred Stock, Shares Authorized	900,000,000	900,000,000	900,000,000
Common Stock, Par or Stated Value Per Share	$ 0.01	$ 0.01	$ 0.01
Preferred Stock, Par or Stated Value Per Share	$ 0.01	$ 0.01	$ 0.01
Business Combination, Percentage Ownership Of The Combined Entity After The Transaction By Stockholders Of The Company	99.40%

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Investments in Single-Family Residential Properties - Net Carrying Amount of Properties (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Real Estate [Abstract]
Land	$ 4,501,831	$ 4,499,346
Single-family residential property	13,386,936	13,121,179
Capital improvements	511,034	513,269
Equipment	113,359	113,370
Total gross investments in the properties	18,513,160	18,247,164
Less: accumulated depreciation	(2,381,059)	(2,003,972)
Investments in single-family residential properties, net	$ 16,132,101	$ 16,243,192

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Investments in Single-Family Residential Properties - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019
Property, Plant and Equipment [Line Items]
Capitalized acquisition costs, net	$ 119,292		$ 119,292		$ 119,608
Capitalized interest costs	67,483		67,483		65,747
Capitalized property taxes, net	26,541		26,541		25,565
Capitalized insurance, net	4,639		4,639		4,616
Capitalized HOA fees, net	3,023		3,023		$ 2,836
Depreciation and amortization	138,147	$ 133,315	410,440	$ 399,955
Provisions for impairment	289	3,960	4,202	11,289
Real estate properties
Property, Plant and Equipment [Line Items]
Depreciation and amortization	136,517	132,266	406,078	396,568
Furniture and equipment
Property, Plant and Equipment [Line Items]
Depreciation and amortization	$ 1,630	$ 1,049	$ 4,362	$ 3,387

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Cash, Cash Equivalents, and Restricted Cash - Reconciliation to Statements of Cash Flows (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019	Sep. 30, 2019	Dec. 31, 2018
Cash and Cash Equivalents [Abstract]
Cash and cash equivalents	$ 559,567	$ 92,258
Restricted cash	249,341	193,987
Total cash, cash equivalents, and restricted cash shown in the condensed consolidated statements of cash flows	$ 808,908	$ 286,245	$ 326,413	$ 359,991

XML

Cash, Cash Equivalents, and Restricted Cash - Schedule of Restricted Cash Accounts (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Restricted Cash and Cash Equivalents Items [Line Items]
Restricted cash	$ 249,341	$ 193,987
Resident security deposits
Restricted Cash and Cash Equivalents Items [Line Items]
Restricted cash	156,207	148,186
Property taxes
Restricted Cash and Cash Equivalents Items [Line Items]
Restricted cash	57,296	10,443
Collections
Restricted Cash and Cash Equivalents Items [Line Items]
Restricted cash	24,642	24,034
Capital expenditures
Restricted Cash and Cash Equivalents Items [Line Items]
Restricted cash	5,628	5,627
Letters of credit
Restricted Cash and Cash Equivalents Items [Line Items]
Restricted cash	3,319	3,459
Special and other reserves
Restricted Cash and Cash Equivalents Items [Line Items]
Restricted cash	$ 2,249	$ 2,238

XML

Schedule of Other Assets (Details) $ in Thousands	Sep. 30, 2020 USD ($) property	Dec. 31, 2019 USD ($) property
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Investments in debt securities, net	$ 309,122	$ 316,991
Investment in unconsolidated joint venture	53,756	54,778
Held for sale assets(1)	50,685	116,529
Rent and other receivables, net	36,540	25,244
Prepaid Expense	27,396	32,106
ROU lease assets — operating and finance, net	21,510	13,768
Investments in equity securities	16,734	16,650
Corporate fixed assets, net	8,809	9,825
Deferred leasing costs, net	7,985	7,427
Amounts deposited and held by others	5,863	1,348
Deferred financing costs, net	987	2,765
Derivative instruments (Note 7)	1	1,643
Other	12,183	6,192
Total	$ 551,571	$ 605,266
Number Of Real Estate Properties Classified As Held-For-Sale | property	211	478

XML

Other Assets - Narrative (Details)		3 Months Ended		9 Months Ended
	Dec. 31, 2019 USD ($) property	Sep. 30, 2020 USD ($) property	Sep. 30, 2019 USD ($)	Sep. 30, 2020 USD ($) property	Sep. 30, 2019 USD ($)	Dec. 31, 2017 USD ($)
Schedule of Investments [Line Items]
Investments in debt securities, net	$ 316,991,000	$ 309,122,000		$ 309,122,000
Debt Instrument, Unamortized Discount		6,888,000		6,888,000
Debt Securities, Held-to-maturity, Allowance for Credit Loss		0		0
Held-to-maturity securities, unrecognized holding gain	0	0		0
Held-to-maturity securities, unrecognized holding loss	0
Other than temporary impairment recognized in other comprehensive income	0
Operating Lease, Variable Lease Income		23,762,000	$ 24,282,000	68,422,000	$ 68,865,000
Operating Lease, Impairment Loss		1,750,000		1,750,000
Investments in equity securities	16,650,000	16,734,000		16,734,000
Equity Securities, FV-NI, Unrealized Gain (Loss)		0	$ (6,480,000)	(34,000)	$ (6,480,000)
Debt Issuance Costs, Line of Credit Arrangements, Gross						$ 9,673,000
Debt issuance costs, unamortized balance	$ 2,765,000	$ 987,000		$ 987,000
Joint venture with FNMA | Merger with Starwood Waypoint Homes
Schedule of Investments [Line Items]
Interest joint venture		10.00%		10.00%
Number of real estate properties owned by joint venture | property	641	581		581
Minimum
Schedule of Investments [Line Items]
Lessor leasing arrangements, operating leases, term of contract		12 months		12 months
Residential Mortgage Backed Securities
Schedule of Investments [Line Items]
Investments in debt securities, net		$ 309,122,000		$ 309,122,000
Residential Mortgage Backed Securities | Minimum
Schedule of Investments [Line Items]
Marketable securities, expected maturity term				1 month
Residential Mortgage Backed Securities | Maximum
Schedule of Investments [Line Items]
Marketable securities, expected maturity term				7 years
Mortgage Loans
Schedule of Investments [Line Items]
Debt Instrument, Unamortized Discount		0		$ 0
IH1 2017-1 | Mortgage Loans
Schedule of Investments [Line Items]
Debt Instrument, Unamortized Discount	$ 2,641,000	$ 2,377,000		$ 2,377,000

XML

Other Assets Schedule of Leases (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Assets and Liabilities, Lessee [Abstract]
Operating Lease, Right-of-Use Asset	$ 12,112	$ 12,552
Finance Lease, Right-of-Use Asset, after Accumulated Amortization	9,398	1,216
Operating Lease, Liability	15,190	13,787
Finance Lease, Liability	$ 8,979	$ 1,210
Operating Lease, Weighted Average Remaining Lease Term	3 years 10 months 24 days	3 years 9 months 18 days
Finance Lease, Weighted Average Remaining Lease Term	3 years 3 months 18 days	2 years
Lessee, Operating Lease, Discount Rate	3.70%	4.00%
Lessee, Finance Lease, Discount Rate	4.00%	4.00%

XML

Other Assets Schedule of Rent Revenues (Details) $ in Thousands	Sep. 30, 2020 USD ($)
Schedule of rent revenues [Abstract]
Remainder of 2020	$ 401,730
2021	751,863
2022	81,892
2023	0
2024	0
Thereafter	0
Total	$ 1,235,485

XML

Debt - Schedule of Mortgage Loans (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2020 USD ($) extension	Sep. 30, 2019 USD ($)	Dec. 31, 2019 USD ($)
Debt Instrument [Line Items]
Less: deferred financing costs, net	$ (20,310)
Long-term Debt	8,330,045
Debt Instrument, Unamortized Discount	6,888
Repayments of Secured Debt	$ 157,791	$ 798,415
London Interbank Offered Rate (LIBOR)
Debt Instrument [Line Items]
Debt instrument, variable rate	0.15%
Mortgage Loans
Debt Instrument [Line Items]
Long-Term Debt, Net Of Unamortized Discount (Premium)	$ 6,108,880		$ 6,266,407
Less: deferred financing costs, net	(13,900)		(27,946)
Long-term Debt	6,094,980		6,238,461
Debt Instrument, Unamortized Discount	0
IH1 2017-1 | Mortgage Loans
Debt Instrument [Line Items]
Long-Term Debt, Net Of Unamortized Discount (Premium)	$ 994,699		995,520
Fixed interest rate	4.23%
Debt Instrument, Term	10 years
Debt Instrument, Unamortized Discount	$ 2,377		2,641
SWH 2017-1, IH 2017-2, IH 2018-1, IH 2018-2, IH 2018-3, IH 2018-4 [Member] | Mortgage Loans
Debt Instrument [Line Items]
Debt Instrument, Term	2 years
Debt Instrument, Extended Term	1 year
SWH 2017-1, IH 2017-2, IH 2018-1, IH 2018-2, IH 2018-3, IH 2018-4 [Member] | Mortgage Loans | Minimum
Debt Instrument [Line Items]
Basis spread	0.76%
Debt Instrument, Term	2 years
Debt Instrument, Number Of Extensions | extension	3
SWH 2017-1, IH 2017-2, IH 2018-1, IH 2018-2, IH 2018-3, IH 2018-4 [Member] | Mortgage Loans | Maximum
Debt Instrument [Line Items]
Basis spread	3.47%
Debt Instrument, Number Of Extensions | extension	5
SWH 2017-1 | Mortgage Loans
Debt Instrument [Line Items]
Weighted Average Interest Rate	1.72%
Long-Term Debt, Net Of Unamortized Discount (Premium)	$ 732,778		744,092
SWH 2017-1 | Mortgage Loans | Minimum
Debt Instrument [Line Items]
Basis spread	1.02%
SWH 2017-1 | Mortgage Loans | Maximum
Debt Instrument [Line Items]
Basis spread	3.47%
IH 2017-2 | Mortgage Loans
Debt Instrument [Line Items]
Weighted Average Interest Rate	1.30%
Long-Term Debt, Net Of Unamortized Discount (Premium)	$ 614,031		624,475
IH 2017-2 | Mortgage Loans | Minimum
Debt Instrument [Line Items]
Basis spread	0.91%
IH 2017-2 | Mortgage Loans | Maximum
Debt Instrument [Line Items]
Basis spread	1.86%
IH 2018-1 | Mortgage Loans
Debt Instrument [Line Items]
Weighted Average Interest Rate	1.27%
Long-Term Debt, Net Of Unamortized Discount (Premium)	$ 775,118		793,720
IH 2018-1 | Mortgage Loans | Minimum
Debt Instrument [Line Items]
Basis spread	0.76%
IH 2018-1 | Mortgage Loans | Maximum
Debt Instrument [Line Items]
Basis spread	2.06%
IH 2018-2 | Mortgage Loans
Debt Instrument [Line Items]
Weighted Average Interest Rate	1.49%
Long-Term Debt, Net Of Unamortized Discount (Premium)	$ 928,939		957,135
IH 2018-2 | Mortgage Loans | Minimum
Debt Instrument [Line Items]
Basis spread	0.95%
IH 2018-2 | Mortgage Loans | Maximum
Debt Instrument [Line Items]
Basis spread	2.30%
IH 2018-3 | Mortgage Loans
Debt Instrument [Line Items]
Weighted Average Interest Rate	1.50%
Long-Term Debt, Net Of Unamortized Discount (Premium)	$ 1,138,876		1,213,035
IH 2018-3 | Mortgage Loans | Minimum
Debt Instrument [Line Items]
Basis spread	1.05%
IH 2018-3 | Mortgage Loans | Maximum
Debt Instrument [Line Items]
Basis spread	2.30%
IH 2018-4 | Mortgage Loans
Debt Instrument [Line Items]
Weighted Average Interest Rate	1.57%
Long-Term Debt, Net Of Unamortized Discount (Premium)	$ 924,439		$ 938,430
IH 2018-4 | Mortgage Loans | Minimum
Debt Instrument [Line Items]
Basis spread	1.15%
IH 2018-4 | Mortgage Loans | Maximum
Debt Instrument [Line Items]
Basis spread	2.25%

XML

Debt - Mortgage Loans Narrative (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2020 USD ($) loan property extension	Sep. 30, 2019 USD ($)	Dec. 31, 2019 USD ($) property	Dec. 31, 2018
Debt Instrument [Line Items]
Investments in debt securities, net	$ 309,122		$ 316,991
Real Estate Investment Property, Net	16,132,101		$ 16,243,192
Repayments of Secured Debt	$ (157,791)	$ (798,415)
Mortgage Loans
Debt Instrument [Line Items]
Debt instrument, loan principal as a percentage of mortgage pool				5.00%
Mortgage Loans | SWH 2017-1, IH 2017-2, IH 2018-1, IH 2018-2, IH 2018-3, IH 2018-4 [Member]
Debt Instrument [Line Items]
Debt instrument, loan principal as a percentage of mortgage pool	5.00%
Mortgage Loans | IH1 2017-1
Debt Instrument [Line Items]
Debt Instrument, Number Of Loans | loan	2
Debt Instrument, Term	10 years
Fixed interest rate	4.23%
Mortgage Loans | IH1 2017-1 | Class B Certificates
Debt Instrument [Line Items]
Fixed interest rate	4.23%
Mortgage Loans | SWH 2017-1, IH 2017-2, IH 2018-1, IH 2018-2, IH 2018-3, IH 2018-4 [Member]
Debt Instrument [Line Items]
Debt Instrument, Number Of Loans | loan	6
Debt Instrument, Term	2 years
Debt Instrument, Extended Term	1 year
Mortgage Loans | Residential Real Estate
Debt Instrument [Line Items]
Number of Real Estate Properties | property	35,651		37,040
Real Estate Investment Property, Net	$ 6,800,437		$ 7,137,576
Mortgage Loans | Minimum | SWH 2017-1, IH 2017-2, IH 2018-1, IH 2018-2, IH 2018-3, IH 2018-4 [Member]
Debt Instrument [Line Items]
Debt Instrument, Term	2 years
Debt Instrument, Number Of Extensions | extension	3
Basis spread	0.76%
Mortgage Loans | Maximum | SWH 2017-1, IH 2017-2, IH 2018-1, IH 2018-2, IH 2018-3, IH 2018-4 [Member]
Debt Instrument [Line Items]
Debt Instrument, Number Of Extensions | extension	5
Basis spread	3.47%

XML

Debt Debt - Secured Term Loan Narrative (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2020 USD ($) property	Sep. 30, 2019 USD ($)	Dec. 31, 2019 USD ($) property
Debt Instrument [Line Items]
Real Estate Investment Property, Net	$ 16,132,101		$ 16,243,192
Repayments of Notes Payable	$ 101	$ 0
Secured Term Loan
Debt Instrument [Line Items]
Debt Instrument, Term	12 years
Fixed interest rate	3.59%
Secured Term Loan | Maximum
Debt Instrument [Line Items]
Annual Limitation on Collateral Substitution, Percentage	20.00%
Limitation on Collateral Substitution, Percentage	100.00%
Special Releases Allowed After First Anniversary	4
Special Release of Collateral, Percentage	15.00%
Residential Real Estate | Secured Term Loan
Debt Instrument [Line Items]
Number of Real Estate Properties | property	3,332		3,333
Real Estate Investment Property, Net	$ 724,041		$ 734,759
Fixed Rate [Member] | Secured Term Loan
Debt Instrument [Line Items]
Debt Instrument, Term	11 years
London Interbank Offered Rate (LIBOR) | Secured Term Loan | London Interbank Offered Rate (LIBOR)
Debt Instrument [Line Items]
Debt Instrument, Basis Spread on Variable Rate	1.47%

XML

Debt Debt - Schedule of Secured Term Loan (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2020	Dec. 31, 2019
Debt Instrument [Line Items]
Long-term Debt, Gross	$ 8,357,243
Less: deferred financing costs, net	(20,310)
Long-term Debt	$ 8,330,045
Secured Term Loan
Debt Instrument [Line Items]
Fixed interest rate	3.59%
Long-term Debt, Gross	$ 403,363	$ 403,464
Less: deferred financing costs, net	(2,323)	(2,486)
Long-term Debt	$ 401,040	$ 400,978
Debt Instrument, Term	12 years
Fixed Rate [Member] | Secured Term Loan
Debt Instrument [Line Items]
Debt Instrument, Term	11 years
London Interbank Offered Rate (LIBOR) | London Interbank Offered Rate (LIBOR) | Secured Term Loan
Debt Instrument [Line Items]
Debt Instrument, Basis Spread on Variable Rate	1.47%

XML

Debt - Term Loan Facility and Revolving Facility (Details) $ in Thousands		9 Months Ended
	Feb. 06, 2017 USD ($)	Sep. 30, 2020
Line of Credit Facility [Line Items]
Line of credit facility, current borrowing capacity	$ 2,500,000
Debt instrument, number of maturity date extensions	1 year
Revolving Facility | Minimum
Line of Credit Facility [Line Items]
Line of credit facility, unused capacity, commitment fee percentage		0.20%
Line of credit facility, facility fee percentage		0.125%
Revolving Facility | Maximum
Line of Credit Facility [Line Items]
Line of credit facility, unused capacity, commitment fee percentage		0.35%
Line of credit facility, facility fee percentage		0.30%
Line of Credit
Line of Credit Facility [Line Items]
Line of credit facility, additional borrowing capacity	$ 1,500,000
Debt covenant, net leverage ratio		8.00
Line of Credit | London Interbank Offered Rate (LIBOR)
Line of Credit Facility [Line Items]
Basis spread		1.00%
Line of Credit | Federal Funds Effective Swap Rate
Line of Credit Facility [Line Items]
Basis spread		0.50%
Line of Credit | Revolving Facility
Line of Credit Facility [Line Items]
Line of credit facility, current borrowing capacity	1,000,000
Line of Credit | Revolving Facility | London Interbank Offered Rate (LIBOR)
Line of Credit Facility [Line Items]
Basis spread		1.75%
Line of Credit | Revolving Facility | Minimum | London Interbank Offered Rate (LIBOR)
Line of Credit Facility [Line Items]
Basis spread		1.75%
Line of Credit | Revolving Facility | Minimum | Base Rate
Line of Credit Facility [Line Items]
Basis spread		0.75%
Line of Credit | Revolving Facility | Maximum | London Interbank Offered Rate (LIBOR)
Line of Credit Facility [Line Items]
Basis spread		2.30%
Line of Credit | Revolving Facility | Maximum | Base Rate
Line of Credit Facility [Line Items]
Basis spread		1.30%
Line of Credit | Term Loan Facility
Line of Credit Facility [Line Items]
Line of credit facility, current borrowing capacity	$ 1,500,000
Line of Credit | Term Loan Facility | London Interbank Offered Rate (LIBOR)
Line of Credit Facility [Line Items]
Basis spread		1.70%
Line of Credit | Term Loan Facility | Minimum | London Interbank Offered Rate (LIBOR)
Line of Credit Facility [Line Items]
Basis spread		1.70%
Line of Credit | Term Loan Facility | Minimum | Base Rate
Line of Credit Facility [Line Items]
Basis spread		0.70%
Line of Credit | Term Loan Facility | Maximum | London Interbank Offered Rate (LIBOR)
Line of Credit Facility [Line Items]
Basis spread		2.30%
Line of Credit | Term Loan Facility | Maximum | Base Rate
Line of Credit Facility [Line Items]
Basis spread		1.30%

XML

Debt Debt - Schedule of Term Loan Facility and Revolving Facility (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2020	Dec. 31, 2019
Line of Credit Facility [Line Items]
Long-term Debt, Gross	$ 8,357,243
Less: deferred financing costs, net	(20,310)
Long-term Debt	$ 8,330,045
London Interbank Offered Rate (LIBOR)
Line of Credit Facility [Line Items]
Debt instrument, variable rate	0.15%
Line of Credit | Term Loan Facility
Line of Credit Facility [Line Items]
Line of Credit Facility, Interest Rate at Period End	1.85%
Long-term Debt, Gross	$ 1,500,000	$ 1,500,000
Less: deferred financing costs, net	(4,087)	(6,253)
Long-term Debt	$ 1,495,913	1,493,747
Line of Credit | Revolving Facility
Line of Credit Facility [Line Items]
Line of Credit Facility, Interest Rate at Period End	1.90%
Long-term Debt, Gross	$ 0	$ 0
Line of Credit | London Interbank Offered Rate (LIBOR)
Line of Credit Facility [Line Items]
Debt Instrument, Basis Spread on Variable Rate	1.00%
Line of Credit | London Interbank Offered Rate (LIBOR) | Term Loan Facility
Line of Credit Facility [Line Items]
Debt Instrument, Basis Spread on Variable Rate	1.70%
Line of Credit | London Interbank Offered Rate (LIBOR) | Revolving Facility
Line of Credit Facility [Line Items]
Debt Instrument, Basis Spread on Variable Rate	1.75%

XML

Debt - Convertible Senior Notes Narrative (Details)			3 Months Ended		9 Months Ended
	Sep. 30, 2020 USD ($) $ / shares	Jul. 01, 2019 USD ($) $ / shares shares	Sep. 30, 2020 USD ($) $ / shares	Sep. 30, 2019 USD ($)	Sep. 30, 2020 USD ($) $ / shares	Sep. 30, 2019 USD ($)	Dec. 31, 2019 USD ($)	Jan. 31, 2017 USD ($)	Jul. 31, 2014 USD ($)
Debt Instrument [Line Items]
Amortization of debt discounts					$ 4,077,000	$ 6,026,000
Share Price | $ / shares	$ 27.99		$ 27.99		$ 27.99
Debt instrument, percentage of repurchase price to principal amount if company undergoes fundamental change	100.00%		100.00%		100.00%
Debt instrument, event of default minimum percentage of principal amount	25.00%		25.00%		25.00%
Debt instrument, percentage of repurchase price to principal amount if company defaults	100.00%		100.00%		100.00%
2019 Convertible Notes | Debt Instrument, Redemption, Period One [Member]
Debt Instrument [Line Items]
Convertible senior notes amount									$ 230,000,000
Coupon Rate									3.00%
Debt Conversion, Converted Instrument, Shares Issued | shares		12,553,864
Debt instrument, convertible, conversion ratio		0.0545954
Debt Instrument, Principal Amount Used For Conversion		$ 1,000
Debt instrument, convertible conversion price (in dollars per share) | $ / shares		$ 18.32
Amortization of debt discounts						5,586,000
2022 Convertible Notes
Debt Instrument [Line Items]
Debt Instrument, Convertible, If-converted Value in Excess of Principal	$ 77,661,000
2022 Convertible Notes | Debt Instrument, Redemption, Period One [Member]
Debt Instrument [Line Items]
Convertible senior notes amount	$ 345,000,000		$ 345,000,000		$ 345,000,000		$ 345,000,000	$ 345,000,000
Coupon Rate	3.50%		3.50%		3.50%			3.50%
Debt instrument, convertible, conversion ratio					0.0437694
Debt Instrument, Principal Amount Used For Conversion	$ 1,000		$ 1,000		$ 1,000
Debt instrument, convertible conversion price (in dollars per share) | $ / shares	$ 22.85		$ 22.85		$ 22.85
Amortization of debt discounts			$ 4,311,000	$ 4,247,000	$ 12,869,000	$ 12,681,000

XML

Debt - Schedule of Convertible Senior Notes (Details)		9 Months Ended
	Jul. 01, 2019 USD ($)	Sep. 30, 2020 USD ($)	Dec. 31, 2019 USD ($)	Nov. 16, 2017 USD ($)	Jan. 31, 2017 USD ($)	Jul. 31, 2014 USD ($)
Convertible Notes Payable [Abstract]
Net unamortized fair value adjustment		$ (6,888,000)
Total		$ 338,112,000	$ 334,299,000
2019 Convertible Notes | Debt Instrument, Redemption, Period One [Member]
Convertible Notes Payable [Abstract]
Coupon Rate						3.00%
Conversion Rate	0.0545954
Principal Amount						$ 230,000,000
Debt Instrument, Principal Amount Used For Conversion	$ 1,000
2022 Convertible Notes | Debt Instrument, Redemption, Period One [Member]
Convertible Notes Payable [Abstract]
Coupon Rate		3.50%			3.50%
Effective Rate		5.12%
Conversion Rate		0.0437694
Remaining Amortization Period		1 year 3 months 14 days
Principal Amount		$ 345,000,000	$ 345,000,000		$ 345,000,000
Convertible debt, fair value disclosures				$ 324,252,000
Debt Instrument, Principal Amount Used For Conversion		$ 1,000

XML

Debt - Debt Maturities Schedule (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Year
Remainder of 2020	$ 1,346,809
2021	3,767,372
2022	1,845,000
2023	0
2024	0
Thereafter	1,398,062
Total	8,357,243
Less: deferred financing costs, net	(20,310)
Less: unamortized fair value adjustment	(6,888)
Long-term Debt	8,330,045
Mortgage Loans
Year
Remainder of 2020	1,346,809
2021	3,767,372
2022	0
2023	0
2024	0
Thereafter	994,699
Total	6,108,880
Less: deferred financing costs, net	(13,900)	$ (27,946)
Less: unamortized fair value adjustment	0
Long-term Debt	6,094,980	6,238,461
Secured Term Loan
Year
Remainder of 2020	0
2021	0
2022	0
2023	0
2024	0
Thereafter	403,363
Total	403,363	403,464
Less: deferred financing costs, net	(2,323)	(2,486)
Less: unamortized fair value adjustment	0
Long-term Debt	401,040	400,978
Term Loan Facility
Year
Remainder of 2020	0
2021	0
2022	1,500,000
2023	0
2024	0
Thereafter	0
Total	1,500,000
Less: deferred financing costs, net	(4,087)	(6,253)
Less: unamortized fair value adjustment	0
Long-term Debt	1,495,913
Revolving Facility
Year
Remainder of 2020	0
2021	0
2022	0
2023	0
2024	0
Thereafter	0
Total	0
Less: deferred financing costs, net	0
Less: unamortized fair value adjustment	0
Long-term Debt	0
Convertible Senior Notes
Year
Remainder of 2020	0
2021	0
2022	345,000
2023	0
2024	0
Thereafter	0
Total	345,000
Less: deferred financing costs, net	0
Less: unamortized fair value adjustment	(6,888)	$ (10,701)
Long-term Debt	$ 338,112

XML

Derivative Instruments - Narrative (Details) $ in Thousands	Sep. 30, 2020 USD ($)	Dec. 31, 2019 USD ($)
Derivative [Line Items]
Interest rate cash flow hedge gain (loss) to be reclassified during next 12 months	$ 152,334
Derivative Liability, Fair Value, Amount Offset Against Collateral	602,507	$ 274,625
Assets Needed for Immediate Settlement, Aggregate Fair Value	$ (631,397)
Not Designated as Hedging Instrument | Minimum
Derivative [Line Items]
Interest rate cap	3.75%
Not Designated as Hedging Instrument | Maximum
Derivative [Line Items]
Interest rate cap	5.31%
Interest rate caps | Not Designated as Hedging Instrument
Derivative [Line Items]
Debt service coverage ratio	1.2

XML

Derivative Instruments - Interest Rate Swap Instruments (Details) - Designated as Hedging Instrument - London Interbank Offered Rate (LIBOR) $ in Thousands	Sep. 30, 2020 USD ($)
Interest Rate Swap 1
Derivative [Line Items]
Strike Rate	1.97%
Derivative Asset, Notional Amount	$ 750,000
Interest Rate Swap 2
Derivative [Line Items]
Strike Rate	1.74%
Derivative Asset, Notional Amount	$ 750,000
Interest Rate Swap 3
Derivative [Line Items]
Strike Rate	2.86%
Derivative Asset, Notional Amount	$ 400,000
Interest Rate Swap 4
Derivative [Line Items]
Strike Rate	2.23%
Derivative Asset, Notional Amount	$ 800,000
Interest Rate Swap 5
Derivative [Line Items]
Strike Rate	2.85%
Derivative Asset, Notional Amount	$ 400,000
Interest Rate Swap 6
Derivative [Line Items]
Strike Rate	2.86%
Derivative Asset, Notional Amount	$ 400,000
Interest Rate Swap 7
Derivative [Line Items]
Strike Rate	2.13%
Derivative Asset, Notional Amount	$ 550,000
Interest Rate Swap 8
Derivative [Line Items]
Strike Rate	2.99%
Derivative Asset, Notional Amount	$ 325,000
Interest Rate Swap 9
Derivative [Line Items]
Strike Rate	2.99%
Derivative Asset, Notional Amount	$ 595,000
Interest Rate Swap 10
Derivative [Line Items]
Strike Rate	1.47%
Derivative Asset, Notional Amount	$ 450,000
Interest Rate Swap 11
Derivative [Line Items]
Strike Rate	2.90%
Derivative Asset, Notional Amount	$ 1,100,000
Interest Rate Swap 12
Derivative [Line Items]
Strike Rate	2.23%
Derivative Asset, Notional Amount	$ 550,000
Interest Rate Swap 13
Derivative [Line Items]
Strike Rate	2.90%
Derivative Asset, Notional Amount	$ 400,000
Interest Rate Swap 14
Derivative [Line Items]
Strike Rate	3.14%
Derivative Asset, Notional Amount	$ 400,000
Interest Rate Swap 15
Derivative [Line Items]
Strike Rate	3.16%
Derivative Asset, Notional Amount	$ 400,000

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Derivative Instruments - Fair Values of Derivative Instruments on the Consolidated Balance Sheets (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Derivatives, Fair Value [Line Items]
Asset Derivatives	$ 1	$ 1,643
Liability Derivatives	602,507	275,679
Other assets
Derivatives, Fair Value [Line Items]
Asset Derivatives	1	1,643
Other liabilities
Derivatives, Fair Value [Line Items]
Liability Derivatives	602,507	275,679
Interest rate swaps | Designated as Hedging Instrument | Other assets
Derivatives, Fair Value [Line Items]
Asset Derivatives	0	1,643
Interest rate swaps | Designated as Hedging Instrument | Other liabilities
Derivatives, Fair Value [Line Items]
Liability Derivatives	602,507	275,679
Interest rate caps | Not Designated as Hedging Instrument | Other assets
Derivatives, Fair Value [Line Items]
Asset Derivatives	1	0
Interest rate caps | Not Designated as Hedging Instrument | Other liabilities
Derivatives, Fair Value [Line Items]
Liability Derivatives	$ 0	$ 0

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Derivative Instruments - Offsetting of Derivatives (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Offsetting assets:
Gross Amounts of Recognized Assets	$ 1	$ 1,643
Gross Amounts Offset in the Statement of Financial Position	0	0
Net Amounts of Assets Presented in the Statement of Financial Position	1	1,643
Gross Amounts Not Offset in the Statement of Financial Position, Financial Instruments	0	(1,054)
Gross Amounts Not Offset in the Statement of Financial Position, Cash Collateral Received	0	0
Net Amount	1	589
Offsetting liabilities:
Gross Amounts of Recognized Liabilities	602,507	275,679
Gross Amounts Offset in the Statement of Financial Position	0	0
Net Amounts of Liabilities Presented in the Statement of Financial Position	602,507	275,679
Gross Amounts Not Offset in the Statement of Financial Position, Financial Instruments	0	(1,054)
Gross Amounts Not Offset in the Statement of Financial Position, Cash Collateral Received	0	0
Net Amount	$ 602,507	$ 274,625

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Derivative Instruments - Effect of Derivative Instruments on the Consolidated Statements of Operations (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Interest expense	$ 87,713	$ 89,067	$ 258,541	$ 278,756
Interest rate caps
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Amount of Loss Recognized in Net Income on Derivative	146	64	198	98
AOCI into Net Loss | Reclassified from AOCI
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Interest expense	(37,557)	4,272	(74,166)	23,026
Cash Flow Hedging | Interest rate swaps
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Amount of Loss Recognized in OCI on Derivative	$ (4,171)	$ (71,729)	$ (398,426)	$ (308,196)

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Stockholders' Equity - Narrative (Details) $ / shares in Units, $ in Thousands			3 Months Ended		9 Months Ended
	Oct. 22, 2020 $ / shares	Jun. 04, 2020 shares	Sep. 30, 2020 USD ($) $ / shares shares	Sep. 30, 2019 USD ($) $ / shares shares	Sep. 30, 2020 USD ($) $ / shares shares	Sep. 30, 2019 USD ($) $ / shares shares	Jun. 30, 2020 shares	Dec. 31, 2019 shares	Aug. 22, 2019 USD ($)	Jun. 30, 2019 shares	Dec. 31, 2018 shares
Class of Stock [Line Items]
Common stock, shares outstanding (in shares) | shares			560,534,032		560,534,032			541,642,725
Issuance of common stock (in shares) | shares			1,353		18,891,307
Dividends declared per common share | $ / shares			$ 0.15	$ 0.13	$ 0.45	$ 0.39
Issuance of common stock, net				$ 17,737	$ 503,798	$ 17,737
Merger with Starwood Waypoint Homes
Class of Stock [Line Items]
Conversion ratio from units to shares					1
Public Offering [Member]
Class of Stock [Line Items]
Issuance of common stock (in shares) | shares		16,675,000
Stock Issued During Period, Shares, Other | shares		2,175,000
Issuance of common stock, net					$ 447,533
Commissions and Other Costs					6,861
Total ATM Equity Program Amount [Member]
Class of Stock [Line Items]
Common Stock, Beginning Amount Authorized									$ 800,000
Issuance of common stock, net			$ 0	17,737	56,265	17,737
Commissions and Other Costs				$ 1,068	977	$ 1,068
Common Stock, Remaining Amount Authorized			$ 685,799		$ 685,799
Common Stock
Class of Stock [Line Items]
Common stock, shares outstanding (in shares) | shares			560,534,032	538,356,606	560,534,032	538,356,606	560,532,679	541,642,725		525,126,947	520,647,977
Issuance of common stock (in shares) | shares			1,353	671,020	18,562,466	671,020
Issuance of common stock, net				$ 7	$ 186	$ 7
Common Stock | Total ATM Equity Program Amount [Member]
Class of Stock [Line Items]
Issuance of common stock (in shares) | shares			0	671,020	1,887,466	671,020
Total Stockholders' Equity
Class of Stock [Line Items]
Issuance of common stock, net				$ 17,737	$ 503,798	$ 17,737
Subsequent Event
Class of Stock [Line Items]
Dividends declared per common share | $ / shares	$ 0.15

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Stockholders' Equity - Summary of Dividends Declared (Details) - USD ($) $ / shares in Units, $ in Thousands													3 Months Ended		9 Months Ended
	May 29, 2020	May 13, 2020	Feb. 28, 2020	Feb. 12, 2020	Nov. 27, 2019	Nov. 13, 2019	Aug. 30, 2019	Aug. 15, 2019	May 31, 2019	May 15, 2019	Feb. 28, 2019	Feb. 13, 2019	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Equity [Abstract]
Common Stock, Dividends, Per Share, Cash Paid		$ 0.15		$ 0.15		$ 0.13		$ 0.13		$ 0.13		$ 0.13	$ 0.15
Common Stock, Dividends, Per Share, Declared													$ 0.15	$ 0.13	$ 0.45	$ 0.39
Dividends, total amount declared	$ 81,916		$ 81,673		$ 70,693		$ 70,465		$ 68,334		$ 67,965		$ 84,286

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Related Party Transactions (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Related Party Transactions [Abstract]
Management fees earned	$ 636	$ 696	$ 1,945	$ 2,145

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Share-Based Compensation - Narrative (Details) - USD ($) $ in Thousands		9 Months Ended
	May 01, 2019	Sep. 30, 2020
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Employee service share-based compensation not yet recognized		$ 23,401
PRSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share based compensation arrangement, performance units granted and vested in period (in shares)		91,200
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other Than Options, Forfeited in Period Due to Performance Target Level Not Met		5,348
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeited in Period		22,060
Granted (in shares)		423,358
Restricted Stock and Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeited in Period		31,870
Granted (in shares)		649,118
LTIP Agreement | Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (in shares)		499,228
Omnibus Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation arrangement, number of shares authorized (in shares)		16,000,000
Omnibus Incentive Plan | Restricted Stock Units (RSUs) - Performance-Based and OP Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation arrangement, award vesting period	3 years
Shares Granted, Value, Share-based Payment Arrangement, before Forfeiture	$ 12,390
Director | Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (in shares)		58,690
Share-based Compensation Award, Tranche One | Omnibus Incentive Plan | Restricted Stock Units (RSUs) - Performance-Based and OP Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage	25.00%
Share-based Compensation Award, Tranche Two | Omnibus Incentive Plan | Restricted Stock Units (RSUs) - Performance-Based and OP Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage	25.00%
Share-based Compensation Award, Tranche Three | Omnibus Incentive Plan | Restricted Stock Units (RSUs) - Performance-Based and OP Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage	50.00%

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Share-Based Compensation - Summary of Total Share-Based Awards (Details) $ / shares in Units, $ in Thousands	9 Months Ended
	Sep. 30, 2020 USD ($) $ / shares shares
Time-Vesting Awards
Restricted Stock and Restricted Stock Units Outstanding
Balance, Beginning of period (in shares)	685,069
Granted (in shares)	225,760
Vested (in shares)	(293,481)
Forfeited/cancelled (in shares)	(9,810)
Balance, Ending of period (in shares)	607,538
Restricted Stock and Restricted Stock Units Weighted Average Grant Date Fair Value
Balance, Beginning of period (in dollars per share) | $ / shares	$ 22.48
Granted (in dollars per share) | $ / shares	28.25
Vested (in dollars per share) | $ / shares	(22.97)
Forfeited (in dollars per share) | $ / shares	(25.54)
Balance, Ending of period (in dollars per share) | $ / shares	$ 24.34
PRSUs
Restricted Stock and Restricted Stock Units Outstanding
Balance, Beginning of period (in shares)	925,076
Granted (in shares)	423,358
Vested (in shares)	(152,967)
Forfeited/cancelled (in shares)	(22,060)
Balance, Ending of period (in shares)	1,173,407
Restricted Stock and Restricted Stock Units Weighted Average Grant Date Fair Value
Balance, Beginning of period (in dollars per share) | $ / shares	$ 23.13
Granted (in dollars per share) | $ / shares	29.73
Vested (in dollars per share) | $ / shares	(22.25)
Forfeited (in dollars per share) | $ / shares	(23.48)
Balance, Ending of period (in dollars per share) | $ / shares	$ 25.62
Restricted Stock and Restricted Stock Units
Restricted Stock and Restricted Stock Units Outstanding
Balance, Beginning of period (in shares)	1,610,145
Granted (in shares)	649,118
Vested (in shares)	(446,448)
Forfeited/cancelled (in shares)	(31,870)
Balance, Ending of period (in shares)	1,780,945
Vested, fair value | $	$ 9,867
Restricted Stock and Restricted Stock Units Weighted Average Grant Date Fair Value
Balance, Beginning of period (in dollars per share) | $ / shares	$ 22.86
Granted (in dollars per share) | $ / shares	29.21
Vested (in dollars per share) | $ / shares	(22.72)
Forfeited (in dollars per share) | $ / shares	(24.11)
Balance, Ending of period (in dollars per share) | $ / shares	$ 25.18
Omnibus Incentive Plan
Restricted Stock and Restricted Stock Units Outstanding
Vested (in shares)	(1,787)

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Share-Based Compensation - Fair Value Inputs (Details)	9 Months Ended
	Sep. 30, 2020
Fair Value Assumptions
Expected volatility, minimum	17.20%
Expected volatility, maximum	17.30%
Risk-free rate	0.85%
Minimum
Fair Value Assumptions
Expected holding period (years)	2 years 1 month 2 days
Maximum
Fair Value Assumptions
Expected holding period (years)	2 years 10 months 2 days

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Share-Based Compensation - Summary of Total Share-Based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Share-based compensation arrangement, allocated share-based compensation expense	$ 6,086	$ 4,625	$ 12,293	$ 13,847
Employee service share-based compensation not yet recognized	23,401		$ 23,401
Restricted Stock Units (RSUs)
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Share-based compensation arrangement, weighted average remaining contractual terms			1 year 10 months 24 days
General and Administrative
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Share-based compensation arrangement, allocated share-based compensation expense	4,833	3,818	$ 9,760	11,533
Property Management Expense
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Share-based compensation arrangement, allocated share-based compensation expense	$ 1,253	$ 807	$ 2,533	$ 2,314

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Fair Value Measurements - Carrying Values and Fair Values of Financial Instruments (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Liabilities carried at historical cost on the consolidated balance sheets
Deferred financing costs, net	$ 20,310
Debt Instrument, Unamortized Discount	6,888
Mortgage Loans
Liabilities carried at historical cost on the consolidated balance sheets
Deferred financing costs, net	13,900	$ 27,946
Debt Instrument, Unamortized Discount	0
Secured Term Loan
Liabilities carried at historical cost on the consolidated balance sheets
Deferred financing costs, net	2,323	2,486
Debt Instrument, Unamortized Discount	0
Term Loan Facility
Liabilities carried at historical cost on the consolidated balance sheets
Deferred financing costs, net	4,087	6,253
Debt Instrument, Unamortized Discount	0
Revolving Facility
Liabilities carried at historical cost on the consolidated balance sheets
Deferred financing costs, net	0
Debt Instrument, Unamortized Discount	0
Convertible Senior Notes
Liabilities carried at historical cost on the consolidated balance sheets
Deferred financing costs, net	0
Debt Instrument, Unamortized Discount	6,888	10,701
Fair Value | Level 2
Assets carried at historical cost on the consolidated balance sheets
Investments in debt securities	312,661	318,299
Fair Value | Mortgage Loans | Level 2
Liabilities carried at historical cost on the consolidated balance sheets
Liabilities carried at historical cost	6,181,214	6,292,261
Fair Value | Secured Term Loan | Level 3
Liabilities carried at historical cost on the consolidated balance sheets
Liabilities carried at historical cost	461,617	411,213
Fair Value | Term Loan Facility | Level 3
Liabilities carried at historical cost on the consolidated balance sheets
Liabilities carried at historical cost	1,499,446	1,500,444
Fair Value | Convertible Senior Notes | Level 3
Liabilities carried at historical cost on the consolidated balance sheets
Liabilities carried at historical cost	352,103	346,489
Carrying Value | Level 2
Assets carried at historical cost on the consolidated balance sheets
Investments in debt securities	309,122	316,991
Carrying Value | Mortgage Loans | Level 2
Liabilities carried at historical cost on the consolidated balance sheets
Liabilities carried at historical cost	6,108,880	6,266,407
Carrying Value | Secured Term Loan | Level 3
Liabilities carried at historical cost on the consolidated balance sheets
Liabilities carried at historical cost	403,363	403,464
Carrying Value | Term Loan Facility | Level 3
Liabilities carried at historical cost on the consolidated balance sheets
Liabilities carried at historical cost	1,500,000	1,500,000
Carrying Value | Convertible Senior Notes | Level 3
Liabilities carried at historical cost on the consolidated balance sheets
Liabilities carried at historical cost	$ 338,112	$ 334,299

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Fair Value Measurements Fair Value Measurements - Quantitative Information about Level 3 Fair Value Measurement (Details) - Valuation Technique, Discounted Cash Flow - Level 3	9 Months Ended
	Sep. 30, 2020
Secured Term Loan
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Fair Value Inputs, Effective Rate	2.08%
Term Loan Facility | Minimum
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Fair Value Inputs, Effective Rate	1.88%
Term Loan Facility | Maximum
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Fair Value Inputs, Effective Rate	1.91%
Convertible Senior Notes
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Fair Value Inputs, Effective Rate	1.88%

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Fair Value Measurements - Impaired Assets, Measured at Fair Value on a Nonrecurring Basis (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Investments in single-family residential properties, net held for use and held for sale impairment adjustments
Total impairments	$ (289)	$ (3,960)	$ (4,202)	$ (11,289)
Fair Value, Measurements, Nonrecurring | Level 3 | Rental Properties
Investments in single-family residential properties, net held for use and held for sale impairment adjustments
Pre-impairment amount	1,800	18,723	19,594	49,837
Total impairments	(289)	(3,706)	(4,113)	(9,217)
Fair value	1,511	15,017	15,481	40,620
Fair Value, Measurements, Nonrecurring | Level 3 | Rental Properties
Investments in single-family residential properties, net held for use and held for sale impairment adjustments
Pre-impairment amount	0	885	451	8,438
Total impairments	0	(254)	(89)	(2,072)
Fair value	$ 0	$ 631	$ 362	$ 6,366

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Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Numerator:
Net Income (Loss) Available to Common Stockholders, Basic	$ 32,540	$ 33,616	$ 125,178	$ 93,165
Net Income (Loss) Available to Common Stockholders, Diluted	$ 32,540	$ 33,616	$ 125,178	$ 93,165
Denominator:
Shares used in calculation — basic	560,598,995	537,771,245	550,722,684	528,209,033
Incremental shares attributed to non-vested share-based awards	1,272,378	873,643	1,224,594	951,320
Weighted average common shares outstanding — diluted	561,871,373	538,644,888	551,947,278	529,160,353
Net income per share — basic	$ 0.06	$ 0.06	$ 0.23	$ 0.18
Net income per share — diluted	$ 0.06	$ 0.06	$ 0.23	$ 0.18
2019 Convertible Notes
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of diluted EPS			8,323,258
2022 Convertible Notes
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of diluted EPS	15,100,443	15,100,443	15,100,443	15,100,443
Non-vested share-based awards [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of diluted EPS	153,114	0	120,835	376

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Income Tax (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019
Income Tax Disclosure [Abstract]
Income Tax Expense (Benefit)	$ 293	$ 576	$ 722	$ 2,181
Deferred Tax Assets, Gross	0		0		$ 0
Deferred Tax Liabilities, Gross	$ 0		$ 0		$ 0

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Commitments and Contingencies Schedule of fixed lease costs (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Lessee, Operating Lease, Liability, Payment, Due [Abstract]
Remainder of 2020	$ 1,219
2021	4,840
2022	3,846
2023	2,858
2024	2,500
Thereafter	1,096
Total lease payments	16,359
Less: imputed interest	(1,169)
Total operating lease liability	15,190	$ 13,787
Finance Lease, Liability, Payment, Due [Abstract]
Remainder of 2020	792
2021	3,109
2022	2,526
2023	2,475
2024	714
Thereafter	0
Total lease payments	9,616
Less: imputed interest	(637)
Total finance lease liability	$ 8,979	$ 1,210

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Commitments and Contingencies Schedule of lease costs (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Lease, Cost [Abstract]
Fixed lease cost	$ 1,106	$ 1,140	$ 3,257	$ 3,037
Variable lease cost	263	323	860	1,022
Total operating lease cost	1,369	1,463	4,117	4,059
Amortization of ROU assets	707	137	1,628	374
Interest on lease liabilities	101	22	371	40
Total finance lease cost	$ 808	$ 159	$ 1,999	$ 414

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Subsequent Events - Narrative (Details) $ / shares in Units, $ in Thousands			3 Months Ended		9 Months Ended
	Oct. 22, 2020 $ / shares	Oct. 01, 2020 USD ($) property	Sep. 30, 2020 $ / shares	Sep. 30, 2019 $ / shares	Sep. 30, 2020 $ / shares	Sep. 30, 2019 $ / shares	Oct. 06, 2020 USD ($)
Subsequent Event [Line Items]
Dividends declared per common share | $ / shares			$ 0.15	$ 0.13	$ 0.45	$ 0.39
Subsequent Event
Subsequent Event [Line Items]
Dividends declared per common share | $ / shares	$ 0.15
Payments to Acquire Real Estate Held-for-investment		$ 65,739
Number of Real Estate Properties Purchased | property		327
Joint Venture Equity Commitment							$ 375,000
Subsequent Event | Rockpoint [Member]
Subsequent Event [Line Items]
Joint Venture Equity Commitment							300,000
Subsequent Event | Invitation Homes [Member]
Subsequent Event [Line Items]
Joint Venture Equity Commitment							$ 75,000