Segment Information

9 Months Ended

Sep. 30, 2025

Segment Information

Segment Information

16.Segment Information

We own, operate and develop mixed-use properties concentrated in and around Washington, D.C. We derive our revenue primarily from leases with multifamily and commercial tenants. In addition, our third-party real estate services business provides fee-based real estate services. Our operating segments are aligned with our method of internal reporting and the way our Chief Executive Officer, who is also our Chief Operating Decision Maker ("CODM"), makes key operating decisions, evaluates financial results, allocates resources and manages our business. Accordingly, our three operating and reportable segments are multifamily, commercial and third-party real estate services.

The CODM measures and evaluates the performance of our operating segments based on only the following measures at our share pertaining to each of our segments:

● NOI (multifamily and commercial) - which includes our proportionate share of revenue and expenses attributable to real estate ventures. NOI includes property rental revenue and other property revenue, and deducts property expenses. NOI excludes deferred rent, commercial lease termination revenue, related party management fees, interest expense, and certain other non-cash adjustments, including the accretion of acquired below-market leases and the amortization of acquired above-market leases and below-market ground lease intangibles.

● Net third-party real estate services, excluding reimbursements - which includes revenue streams generated by this segment, excluding reimbursement revenue, as well as the expenses attributable to this segment at our proportionate share, calculated by excluding real estate services revenue from our interests in real estate ventures.

The CODM uses these measures predominantly in the annual budget and forecasting process as well as in his review of our quarterly financial results when making decisions about the allocation of operating and capital resources to each segment. We have included disclosure of NOI and the results of our third-party real estate services business at our share to align with our internal reporting and the information used by our CODM.

The following summarizes NOI at our share for our multifamily and commercial segments, including a reconciliation to our total NOI at our share:

	Three Months Ended September 30, 2025
	Multifamily		Commercial		Total
	(In thousands, at our share)
Property rental revenue	$	47,450	$	52,587	$	100,037
Other property revenue		845		4,183		5,028
Total property revenue		48,295		56,770		105,065
Property expense:
Real estate taxes		5,484		5,902		11,386
Payroll		3,553		3,197		6,750
Utilities		4,115		4,342		8,457
Repairs and maintenance		5,909		5,300		11,209
Other property operating		3,054		4,774		7,828
Total property expense		22,115		23,515		45,630
NOI from reportable segments	$	26,180	$	33,255		59,435
Other NOI (1)						(549)
NOI					$	58,886
	Three Months Ended September 30, 2024
	Multifamily		Commercial		Total
	(In thousands, at our share)
Property rental revenue	$	55,425	$	55,688	$	111,113
Other property revenue		1,085		4,620		5,705
Total property revenue		56,510		60,308		116,818
Property expense:
Real estate taxes		5,861		5,031		10,892
Payroll		4,040		3,257		7,297
Utilities		4,440		4,518		8,958
Repairs and maintenance		6,369		5,464		11,833
Other property operating		3,495		4,515		8,010
Total property expense		24,205		22,785		46,990
NOI from reportable segments	$	32,305	$	37,523		69,828
Other NOI (1)						(1,492)
NOI					$	68,336

	Nine Months Ended September 30, 2025
	Multifamily		Commercial		Total
	(In thousands, at our share)
Property rental revenue	$	155,616	$	154,026	$	309,642
Other property revenue		2,120		12,487		14,607
Total property revenue		157,736		166,513		324,249
Property expense:
Real estate taxes		17,220		17,297		34,517
Payroll		11,141		9,306		20,447
Utilities		11,809		10,511		22,320
Repairs and maintenance		17,623		15,005		32,628
Other property operating		9,283		13,306		22,589
Total property expense		67,076		65,425		132,501
NOI from reportable segments	$	90,660	$	101,088		191,748
Other NOI (1)						(1,937)
NOI					$	189,811

	Nine Months Ended September 30, 2024
	Multifamily		Commercial		Total
	(In thousands, at our share)
Property rental revenue	$	159,359	$	177,320	$	336,679
Other property revenue		2,738		13,245		15,983
Total property revenue		162,097		190,565		352,662
Property expense:
Real estate taxes		16,740		20,705		37,445
Payroll		12,444		10,045		22,489
Utilities		11,376		11,389		22,765
Repairs and maintenance		16,200		16,272		32,472
Other property operating		8,468		13,054		21,522
Total property expense		65,228		71,465		136,693
NOI from reportable segments	$	96,869	$	119,100		215,969
Other NOI (1)						(4,542)
NOI					$	211,427

(1) Includes activity related to development assets and land assets for which we are the ground lessor.

The following summarizes our third-party real estate services business at our share:

	Three Months Ended September 30,					Nine Months Ended September 30,
	2025		2024		X	2025		2024
	(In thousands, at our share)
Property management fees	$	3,321	$	3,903		$	9,961	$	11,892
Asset management fees		1,049		1,139			2,335		3,305
Development fees		361		323			1,348		982
Leasing fees		583		998			2,336		3,246
Construction management fees		179		342			677		903
Other service revenue		1,082		1,551			3,152		3,812
Third-party real estate services revenue, excluding reimbursements		6,575		8,256			19,809		24,140
Third-party real estate services expenses, excluding reimbursements		5,725		7,166			18,358		28,428
Net third-party real estate services, excluding reimbursements	$	850	$	1,090		$	1,451	$	(4,288)

The following reconciles revenue at our share to total revenue per the statements of operations:

	Three Months Ended September 30,					Nine Months Ended September 30,
	2025		2024		X	2025		2024
		(In thousands)
Total property revenue at our share	$	105,065	$	116,818		$	324,249	$	352,662
Third-party real estate services revenue, excluding reimbursements, at our share		6,575		8,256			19,809		24,140
Reimbursement revenue (1)		8,077		8,473			24,126		27,109
Our share of revenue attributable to unconsolidated real estate ventures		(2,146)		(2,147)			(6,403)		(8,667)
Real estate venture partner’s share of revenue attributable to consolidated real estate ventures		1,761		—			2,269		—
Other property revenue		2,061		724			5,150		4,035
Other adjustments (2)		2,477		3,902			1,835		17,251
Total revenue per statements of operations	$	123,870	$	136,026		$	371,035	$	416,530

(1) Represents reimbursements of expenses incurred by us on behalf of third parties, including allocated payroll costs and amounts paid to third-party contractors for construction management projects.

(2) Adjustment to include deferred rent, above/below market lease amortization, commercial lease termination revenue and lease incentive amortization.

The following reconciles NOI at our share to loss before income tax (expense) benefit:

	Three Months Ended September 30,					Nine Months Ended September 30,
	2025		2024		X	2025		2024
	(In thousands)
NOI at our share	$	58,886	$	68,336		$	189,811	$	211,427
Net third-party real estate services, excluding reimbursements, at our share		850		1,090			1,451		(4,288)
Add:
Income (loss) from unconsolidated real estate ventures, net		(664)		(745)			(165)		4
Interest and other income, net		2,378		4,573			3,601		10,105
Gain (loss) on the sale of real estate, net		4,660		(5,352)			47,029		(5,066)
Less:
Depreciation and amortization expense		48,164		50,050			143,311		158,211
General and administrative expense: corporate and other		13,214		11,881			45,491		43,855
Transaction and other costs		494		667			5,251		3,005
Interest expense		34,781		35,267			105,552		97,400
(Gain) loss on the extinguishment of debt, net		—		(43)			2,402		(43)
Impairment loss		4,771		—			45,067		18,236
Adjustments:
Our share of net third-party real estate services attributable to real estate ventures		(197)		(117)			(712)		(451)
NOI attributable to unconsolidated real estate ventures at our share		(1,012)		(1,292)			(3,289)		(5,506)
Real estate venture partner’s share of NOI attributable to consolidated real estate ventures		915		—			1,187		—
Non-cash rent adjustments (1)		(1,561)		3,817			(4,071)		7,756
Other adjustments (2)		3,083		(2,966)			984		(270)
Total adjustments		1,228		(558)			(5,901)		1,529
Loss before income tax (expense) benefit	$	(34,086)	$	(30,478)		$	(111,248)	$	(106,953)

(1) Adjustment to include deferred rent, above/below market lease amortization and lease incentive amortization.

(2) Adjustment to include payments associated with assumed lease liabilities related to operating properties and to exclude commercial lease termination revenue, related party management fees, corporate entity activity and inter-segment activity.