Organization, Basis of Presentation, and Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2018

Schedule of reconciliation of income from book basis to tax basis

The following reconciles net income attributable to common stockholders to taxable net income for the years ended December 31, 2018, 2017 and 2016 (unaudited, dollars in thousands):



	2018 Estimate			2017 Actual			2016 Actual
Net income attributable to common stockholders	$	974,525		$	876,921		$	1,034,002
GAAP gain on sale of communities in excess of tax gain	(194,596		)	(86,661		)	(195,029		)
Depreciation/amortization timing differences on real estate	5,431			(3,642		)	(947		)
Amortization of debt/mark to market interest	2,276			(18,096		)	(18,985		)
Tax compensation expense (in excess of) less than GAAP	(612		)	3,912			9,821
Casualty and impairment loss (gain), net	19,153			20,243			(657		)
Other adjustments	(4,905		)	(4,304		)	11,533
Taxable net income	$	801,272		$	788,373		$	839,738

Schedule of new accounting pronouncements and changes in accounting principles

The following table provides details of the Company’s revenue streams disaggregated by the Company’s reportable operating segments, further discussed in Note 8, “Segment Reporting,” for the years ended December 31, 2018, 2017 and 2016. The segments are classified based on the individual community's status at January 1, 2018 for the years ended December 31, 2018 and 2017, and at January 1, 2017 for the year ended December 31, 2016. Segment information for total revenue has been adjusted to exclude the real estate assets that were sold from January 1, 2016 through December 31, 2018, or otherwise qualify as held for sale as of December 31, 2018, as described in Note 6, "Real Estate Disposition Activities," (dollars in thousands):



	Established Communities		Other Stabilized Communities		Development/ Redevelopment Communities		Non- allocated (1)		Total
For the year ended December 31, 2018
Management, development and other fees	$	—	$	—	$	—	$	3,572	$	3,572
Rental and non-rental related income (2)	9,563		2,417		1,913		—		13,893
Total non-lease revenue (3)	9,563		2,417		1,913		3,572		17,465

Lease income (4)	1,622,837		259,636		295,706		—		2,178,179
Business interruption insurance proceeds	26		—		—		—		26

Total revenue	$	1,632,426	$	262,053	$	297,619	$	3,572	$	2,195,670

For the year ended December 31, 2017
Management, development and other fees	$	—	$	—	$	—	$	4,147	$	4,147
Rental and non-rental related income (2)	9,453		2,083		1,478		—		13,014
Total non-lease revenue (3)	9,453		2,083		1,478		4,147		17,161

Lease income (4)	1,582,209		191,511		230,293		—		2,004,013
Business interruption insurance proceeds (5)	3		—		3,495		—		3,498

Total revenue	$	1,591,665	$	193,594	$	235,266	$	4,147	$	2,024,672

For the year ended December 31, 2016
Management, development and other fees	$	—	$	—	$	—	$	5,599	$	5,599
Rental and non-rental related income (2)	8,299		2,172		1,394		—		11,865
Total non-lease revenue (3)	8,299		2,172		1,394		5,599		17,464

Lease income (4)	1,423,658		219,035		185,343		—		1,828,036
Business interruption insurance proceeds (6)	152		65		20,312		—		20,529

Total revenue	$	1,432,109	$	221,272	$	207,049	$	5,599	$	1,866,029

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(1)	Revenue represents third-party management, asset management and developer fees and miscellaneous income which are not allocated to a reportable segment.


(2)	Amounts include revenue streams related to leasing activities that are not considered components of a lease, including but not limited to, apartment hold fees and application fees, as well as revenue streams not related to leasing activities, including but not limited to, vendor revenue sharing, building advertising, vending and dry cleaning revenue.


(3)	Represents all revenue accounted for under ASC 2014-09.


(4)	Amounts include all revenue streams derived from residential and retail rental income and other lease income, which are excluded from ASC 2014-09 and accounted for under the lease accounting framework.


(5)	Amount for 2017 is primarily business interruption insurance proceeds related to the Maplewood casualty loss as discussed below in "Casualty Gains and Losses."


(6)	Amount for 2016 is primarily business interruption insurance proceeds related to the Edgewater casualty loss as discussed below in "Casualty Gains and Losses."

Schedule of tax components of the entity's common dividends declared

The following summarizes the tax components of the Company's common dividends declared for the years ended December 31, 2018, 2017 and 2016 (unaudited):



	2018		2017		2016
Ordinary income	76	%	75	%	68	%
20% capital gain	11	%	18	%	26	%
Unrecaptured §1250 gain	13	%	7	%	6	%

Schedule of earnings per common share

The Company's earnings per common share are determined as follows (dollars in thousands, except per share data):



	For the year ended
	12/31/18			12/31/17			12/31/16
Basic and diluted shares outstanding
Weighted average common shares—basic	137,844,755			137,523,771			136,928,251
Weighted average DownREIT units outstanding	7,500			7,500			7,500
Effect of dilutive securities	436,986			535,415			525,886
Weighted average common shares—diluted	138,289,241			138,066,686			137,461,637

Calculation of Earnings per Share—basic
Net income attributable to common stockholders	$	974,525		$	876,921		$	1,034,002
Net income allocated to unvested restricted shares	(2,839		)	(2,463		)	(2,610		)
Net income attributable to common stockholders, adjusted	$	971,686		$	874,458		$	1,031,392

Weighted average common shares—basic	137,844,755			137,523,771			136,928,251

Earnings per common share—basic	$	7.05		$	6.36		$	7.53

Calculation of Earnings per Share—diluted
Net income attributable to common stockholders	$	974,525		$	876,921		$	1,034,002
Add: noncontrolling interests of DownREIT unitholders in consolidated partnerships, including discontinued operations	44			42			41
Adjusted net income attributable to common stockholders	$	974,569		$	876,963		$	1,034,043

Weighted average common shares—diluted	138,289,241			138,066,686			137,461,637

Earnings per common share—diluted	$	7.05		$	6.35		$	7.52

Dividends per common share	$	5.88		$	5.68		$	5.40