EX-99.2 3 q42022ex-992.htm EX-99.2 Document

Exhibit 99.2
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For Immediate News Release
February 8, 2023

AVALONBAY COMMUNITIES, INC. ANNOUNCES 2022
OPERATING RESULTS, 3.8% DIVIDEND INCREASE
AND INITIAL 2023 FINANCIAL OUTLOOK
(Arlington, VA) AvalonBay Communities, Inc. (NYSE: AVB) (the “Company”) reported Earnings per Share – diluted (“EPS”), Funds from Operations attributable to common stockholders - diluted (“FFO”) per share and Core FFO per share (as defined in this release) for the three months ended December 31, 2022 and 2021 as detailed below.

 Q4
2022
Q4 2021%
Change
EPS$1.72 $2.40 (28.3)%
FFO per share (1)$2.57 $2.27 13.2 %
Core FFO per share (1)$2.59 $2.27 14.1 %
(1) For additional detail on reconciling items between net income attributable to common stockholders, FFO and Core FFO, see Attachment 14, table 2.

The following table compares the Company’s actual results for EPS, FFO per share and Core FFO per share for the three months ended December 31, 2022 to its results for the prior year period:

Q4 2022 Results Compared to Q4 2021
Per Share
EPSFFOCore FFO
Q4 2021 per share reported results$2.40 $2.27 $2.27 
Same Store Residential NOI (1)0.29 0.29 0.29 
Development and Other Stabilized Residential NOI0.08 0.08 0.08 
Commercial NOI0.01 0.01 0.01 
Overhead and other (0.10)(0.10)(0.05)
Capital markets and transaction activity — 0.01 (0.03)
Unconsolidated investment income0.03 0.03 0.02 
Income taxes(0.02)(0.02)— 
Gain on sale of real estate and depreciation expense(0.97)— — 
Q4 2022 per share reported results$1.72 $2.57 $2.59 
(1) Consists of increases of $0.38 in revenue and $0.09 in operating expenses.

The following table compares the Company’s actual results for EPS, FFO per share and Core FFO per share for the
three months ended December 31, 2022 to its November 2022 outlook:
Q4 2022 Results Compared to November 2022 Outlook
Per Share
EPSFFOCore FFO
Projected per share (1)$1.75 $2.57 $2.60 
Same Store Residential NOI (2)(0.02)(0.02)(0.02)
Development and Other Stabilized Residential NOI— — — 
Commercial NOI— — — 
Overhead and other (0.06)(0.06)(0.02)
Capital markets and transaction activity 0.04 0.04 0.01 
Unconsolidated investment income and other0.07 0.07 0.02 
Income taxes(0.03)(0.03)— 
Gain on sale of real estate and depreciation expense(0.03)— — 
Q4 2022 per share reported results$1.72 $2.57 $2.59 
(1) The mid-point of the Company's November 2022 outlook.
(2) Consists of $0.01 for revenue and $0.01 for operating expenses.

EPS, FFO per share and Core FFO per share for the years ended December 31, 2022 and 2021 are detailed below.

 Full Year 2022Full Year 2021%
Change
EPS$8.12 $7.19 12.9 %
FFO per share$9.67 $8.13 18.9 %
Core FFO per share$9.79 $8.26 18.5 %

The following table compares the Company’s actual results for EPS, FFO per share and Core FFO per share for the year ended December 31, 2022 to its results for the prior year:

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Full Year 2022 Results Compared to Full Year 2021
Per Share
EPSFFOCore FFO
2021 per share reported results$7.19 $8.13 $8.26 
Same Store Residential NOI (1)1.29 1.29 1.29 
Development and Other Stabilized Residential NOI0.42 0.42 0.42 
Commercial NOI0.07 0.07 0.07 
Overhead and other (0.26)(0.26)(0.20)
Capital markets and transaction activity 0.04 0.04 (0.10)
Unconsolidated investment income0.04 0.04 0.05 
Income taxes(0.06)(0.06)— 
Gain on sale of real estate and depreciation expense(0.61)— — 
2022 per share reported results$8.12 $9.67 $9.79 
(1) Consists of increases of $1.57 in revenue and $0.28 in operating expenses.

Same Store Operating Results for the Three Months Ended December 31, 2022 Compared to the Prior Year Period

Same Store total revenue increased $53,664,000, or 10.2%, to $578,448,000. Same Store Residential rental revenue increased $53,447,000, or 10.3%, to $571,828,000, as detailed in the following table:

Same Store Residential Rental Revenue Change
Q4 2022 Compared to Q4 2021
Residential rental revenue
Lease rates8.9 %
Concessions and other discounts1.7 %
Economic occupancy(0.3)%
Other rental revenue1.2 %
Uncollectible lease revenue (excluding rent relief) (1)1.2 %
Rent relief (2)(2.4)%
Residential rental revenue10.3 %
(1) Adjusting to remove the impact of rent relief, uncollectible lease revenue as a percentage of total Residential rental revenue decreased to 3.0% in Q4 2022 from 4.5% in Q4 2021. See Attachment 14, table 10 for further detail of uncollectible lease revenue for the Company’s Same Store portfolio.
(2) The Company recognized $3,060,000 and $15,452,000 from government rent relief programs during Q4 2022 and Q4 2021, respectively.

Same Store Residential operating expenses increased $13,028,000, or 8.2%, to $171,600,000 and Same Store Residential NOI increased $40,573,000, or 11.3%, to $400,722,000.

The following table presents percentage changes in Same Store Residential rental revenue, operating expenses and NOI for the three months ended December 31, 2022 compared to the three months ended December 31, 2021:

Q4 2022 Compared to Q4 2021
Same Store Residential
Rental Revenue
(1)
Opex
(2)
% of
Q4 2022 NOI
 NOI
New England13.3 %8.5 %15.9 %15.0 %
Metro NY/NJ13.4 %7.7 %15.8 %21.5 %
Mid-Atlantic8.4 %4.4 %10.2 %14.8 %
Southeast FL17.4 %34.4 %9.6 %1.6 %
Denver, CO13.2 %10.6 %14.2 %1.3 %
Pacific NW14.2 %9.2 %16.4 %6.2 %
N. California9.7 %10.6 %9.4 %18.3 %
S. California5.5 %7.0 %5.0 %21.3 %
   Total10.3 %8.2 %11.3 %100.0 %
(1) See Attachment 4, Quarterly Residential Rental Revenue and Occupancy Changes, for additional detail.
(2) See Attachment 7, Residential Operating Expenses ("Opex"), for discussion of variances.

Same Store Operating Results for the Year Ended December 31, 2022 Compared to the Prior Year

Same Store total revenue increased $222,830,000, or 11.0%, to $2,250,368,000. Same Store Residential rental revenue increased $218,692,000, or 10.9%, to $2,224,125,000, as detailed in the following table:

Same Store Residential Rental Revenue Change
Full Year 2022 Compared to Full Year 2021
Residential rental revenue
Lease rates7.8 %
Concessions and other discounts1.9 %
Economic occupancy0.1 %
Other rental revenue1.0 %
Uncollectible lease revenue (excluding rent relief) (1)(0.1)%
Rent relief (2)0.2 %
Residential rental revenue10.9 %
(1) Adjusting to remove the impact of rent relief, uncollectible lease revenue as a percentage of total Residential rental revenue decreased to 3.4% in 2022 from 3.7% in 2021.
(2) The Company recognized $36,778,000 and $31,823,000 from government rent relief programs during 2022 and 2021, respectively.

Same Store Residential operating expenses increased $39,015,000, or 6.0%, to $685,469,000 and Same Store Residential NOI increased $179,941,000, or 13.2%, to $1,540,390,000.

The following table presents percentage changes in Same Store Residential rental revenue, operating expenses and NOI for the year ended December 31, 2022 compared to the year ended December 31, 2021:

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Full Year 2022 Compared to Full Year 2021
Same Store Residential
Rental Revenue
(1)
Opex
(2)
% of
2022 NOI
 NOI
New England12.5 %6.0 %16.2 %14.7 %
Metro NY/NJ12.2 %8.0 %14.2 %20.8 %
Mid-Atlantic7.4 %4.6 %8.8 %14.6 %
Southeast FL20.7 %10.4 %27.0 %1.6 %
Denver, CO13.1 %(1.3)%19.5 %1.3 %
Pacific NW15.3 %4.8 %20.3 %6.4 %
N. California8.3 %5.8 %9.4 %18.5 %
S. California11.2 %5.9 %13.6 %22.1 %
   Total10.9 %6.0 %13.2 %100.0 %
(1) See Attachment 6, Full Year Residential Rental Revenue and Occupancy Changes, for additional detail.
(2) See Attachment 7, Residential Opex, for discussion of variances.

Development Activity

Consolidated Development Communities

During the three months ended December 31, 2022, the Company completed the development of Avalon Harbor Isle, located in Island Park, NY. Avalon Harbor Isle contains 172 apartment homes and was constructed for a Total Capital Cost of $94,000,000.

During the three months ended December 31, 2022, the Company started construction of Kanso Milford, located in Milford, MA. Kanso Milford is expected to contain 162 apartment homes when completed and be developed for an estimated Total Capital Cost of $66,000,000.

During 2022, the Company:

completed the development of five communities containing an aggregate of 1,858 apartment homes for an aggregate Total Capital Cost of $692,000,000; and

commenced the development of five communities, which in the aggregate are expected to contain 1,845 apartment homes when completed and be developed for an estimated Total Capital Cost of $729,000,000.

At December 31, 2022, the Company had 17 consolidated Development communities under construction that are expected to contain 5,417 apartment homes and 56,000 square feet of commercial space. Estimated Total Capital Cost at completion for these Development communities is $2,259,000,000.

Disposition Activity

Consolidated Apartment Communities

During the three months ended December 31, 2022, the Company sold Avalon Park Crest, a wholly-owned community, located in Tysons Corner, VA. Avalon Park Crest contains 354 apartment homes and was sold for $145,500,000, resulting in a gain in accordance with GAAP of $88,156,000 and an Economic Gain of $65,764,000.

During the year ended December 31, 2022, the Company sold nine wholly-owned communities containing an aggregate of 2,062 apartment homes. These assets were sold for $924,450,000 and a weighted average initial Market Cap Rate of 4.0%, resulting in a gain in accordance with GAAP of $554,826,000 and an Economic Gain of $404,449,000.

During the three months and year ended December 31, 2022, the Company sold two and 40, respectively, of the 172 residential condominiums at The Park Loggia, located in New York, NY, for gross proceeds of $6,520,000 and $126,848,000, respectively. As of December 31, 2022, the Company has sold 163 of the 172 residential condominiums for aggregate gross proceeds of $478,679,000.

Unconsolidated Real Estate Investments

During the year ended December 31, 2022, Archstone Multifamily Partners AC LP (the "U.S. Fund"), a private discretionary real estate investment vehicle in which the Company holds an equity interest of 28.6%, sold its final three communities, Avalon Grosvenor Tower, Avalon Studio 4121 and Avalon Station 250. These communities contain an aggregate of 671 apartment homes and were sold for $313,500,000. With the disposition of these communities, the Company recognized $4,690,000 in joint venture income associated with its promoted interest in the U.S. Fund.

Acquisition Activity

During the three months ended December 31, 2022, the Company acquired Avalon Highland Creek, a wholly-owned community, located in Charlotte, NC, containing 260 apartment homes for a purchase price of $76,700,000.

During the year ended December 31, 2022, the Company acquired four wholly-owned communities containing 1,313 apartment homes and 16,000 square feet of commercial space for a total purchase price of $536,200,000.

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Structured Investment Program Activity

During 2022, the Company entered into the first commitments under its Structured Investment Program, through which the Company will provide mezzanine loans or preferred equity to third party multifamily developers. The initial commitments are for three mezzanine loans of up to $92,375,000 in the aggregate. These commitments are to fund multifamily development projects in the Company's existing markets. At December 31, 2022, the commitments had a weighted average rate of return of 9.8% and the Company had funded $29,352,000 of these commitments.

Liquidity and Capital Markets

As of December 31, 2022, the Company did not have any borrowings outstanding under its $2,250,000,000 unsecured revolving credit facility (the "Credit Facility") or its $500,000,000 unsecured commercial paper note program. The commercial paper program is backstopped by the Company's commitment to maintain available borrowing capacity under its Credit Facility in an amount equal to actual borrowings under the program. The Company had $2,248,086,000 available under the Credit Facility after considering its commercial paper program and letters of credit as of December 31, 2022.

In addition, at December 31, 2022, the Company had $613,189,000 in unrestricted cash and cash equivalents and $121,056,000 in cash in escrow, which is restricted primarily related to principal reserve funds for secured borrowing arrangements.

The Company’s annualized Net Debt-to-Core EBITDAre (as defined in this release) for the fourth quarter of 2022 was 4.5 times and Unencumbered NOI (as defined in this release) for the year ended December 31, 2022 was 95%.

During the three months ended December 31, 2022, the Company issued $350,000,000 principal amount of unsecured notes in a public offering under its existing shelf registration statement for net proceeds before offering costs of $346,290,000. The notes mature in February 2033 and were issued with a 5.00% coupon. The effective interest rate of the notes is 4.37%, including the impact of offering costs and hedging activity.

During the year ended December 31, 2022, in addition to the debt activity discussed above, the Company had the following debt activity:

The Company repaid its $100,000,000 principal amount variable rate unsecured term loan at its
maturity. The variable rate unsecured term loan was indexed to LIBOR plus 0.90% and entered into in February 2017.

The Company repaid $35,276,000 principal amount secured fixed rate debt with an effective rate of 6.16% in advance of the October 2047 maturity date, recognizing a loss on debt extinguishment of $1,399,000 composed of prepayment penalties and the non-cash write off of unamortized deferred financing costs.

During the three months ended December 31, 2022, the Company settled the outstanding forward contracts entered into in December 2021 under its current continuous equity program, selling 68,577 shares of common stock for $229.34 per share, for net proceeds of $15,727,000.

During the second quarter of 2022, in connection with an underwritten offering of shares, the Company entered into forward contracts to sell 2,000,000 shares of common stock by the end of 2023 for an initial forward sales price of $247.30 per share and approximate proceeds of $494,200,000 net of offering fees and discounts and based on the initial forward price (the "Equity Forward"). The proceeds that the Company expects to receive on the date or dates of settlement are subject to certain customary adjustments during the term of the forward contract for the Company's dividends and a daily interest charge.

First Quarter 2023 Dividend Declaration

The Company’s Board of Directors declared a dividend for the first quarter of 2023 of $1.65 per share on the Company’s common stock (par value of $0.01 per share). The declared dividend is a 3.8% increase over the Company’s prior quarterly dividend of $1.59 per share. The dividend is payable on April 17, 2023 to common stockholders of record as of March 31, 2023.

In declaring the increased dividend, the Board of Directors evaluated the Company’s past performance and future prospects for earnings growth. Additional factors considered in determining the increase included current common dividend distributions, the relationship of the current common dividend distribution to the Company’s Core FFO, the relationship of dividend distributions to taxable income, distribution requirements under rules governing real estate investment trusts and expected growth in taxable income.

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First Quarter and Full Year 2023 Financial Outlook

The following presents a summary of the Company's financial outlook for 2023, further details for which are provided in Attachment 13.

For its first quarter and full year 2023 financial outlook, the Company expects the following:
Projected EPS, Projected FFO and Projected Core FFO Outlook (1)
 Q1 2023Full Year 2023
 LowHighLowHigh
Projected EPS $1.05 $1.15 $6.25 $6.75 
Projected FFO per share $2.46 $2.56 $9.99 $10.49 
Projected Core FFO per share$2.47 $2.57 $10.06 $10.56 
(1) See Attachment 14, table 8, for reconciliations of Projected FFO per share and Projected Core FFO per share to Projected EPS.

The following table compares the Company’s actual results for EPS, FFO per share and Core FFO per share for the full year 2022 to its 2023 full year financial outlook:

Full Year 2023 Outlook Comparison
to Full Year 2022 Full Year Results
Per Share
EPSFFOCore FFO
2022 per share reported results$8.12 $9.67 $9.79 
Same Store NOI (1)0.51 0.51 0.51 
Development and Other Stabilized Residential NOI0.20 0.20 0.19 
Commercial NOI(0.01)(0.01)(0.01)
Overhead and other0.05 0.05 0.03 
Capital markets and transaction activity(0.08)(0.08)(0.10)
Variable rate interest expense(0.10)(0.10)(0.10)
Gain on sale of real estate and depreciation expense(2.19)— — 
Projected per share - 2023 outlook (2)$6.50 $10.24 $10.31 
(1) Consists of increases of $0.85 in revenue and $0.34 in operating expenses.
(2) Represents the mid-point of the Company's February 2023 outlook.

The following table compares the Company’s actual results for EPS, FFO per share and Core FFO per share for the fourth quarter 2022 to its first quarter 2023 financial outlook:

Q4 2022 Results Compared to Q1 2023 Outlook
Per Share
EPSFFOCore FFO
Q4 2022 per share reported results $1.72 $2.57 $2.59 
Same Store NOI (1)(0.03)(0.03)(0.03)
Development and Other Stabilized Residential NOI— — — 
Commercial NOI— — — 
Overhead and other(0.02)(0.02)(0.03)
Capital markets and transaction activity— — — 
Variable rate interest expense(0.01)(0.01)(0.01)
Gain on sale of real estate and depreciation expense(0.56)— — 
Projected per share - Q1 2023 outlook (2)$1.10 $2.51 $2.52 
(1) Consists of increases of $0.04 in revenue and $0.07 in operating expenses.
(2) Represents the mid-point of the Company's February 2023 outlook.

First Quarter Conference Schedule

Management is scheduled to present at Citi's Global Property CEO Conference from March 5 - 8, 2023. During this conference, management may discuss the Company's current operating environment; operating trends; development, redevelopment, disposition and acquisition activity; financial outlook; portfolio strategy and other business and financial matters affecting the Company. Details on how to access a webcast of the Company's presentation will be available in advance of the conference event on the Company's website at http://investors.avalonbay.com.

Other Matters

The Company will hold a conference call on February 9, 2023 at 1:00 PM ET to review and answer questions about this release, its fourth quarter 2022 results, the Attachments (described below) and related matters. To participate on the call, dial 877-407-9716.

To hear a replay of the call, which will be available from February 9, 2023 at 4:00 PM ET to March 9, 2023, dial 844-512-2921 and use replay passcode: 13734358. A webcast of the conference call will also be available at http://investors.avalonbay.com, and an online playback of the webcast will be available for at least seven days following the call.

The Company produces Earnings Release Attachments (the "Attachments") that provide detailed information regarding operating, development, redevelopment, disposition and acquisition activity. These Attachments are considered a part of this earnings release and are available in full with this earnings release via the Company's website at http://investors.avalonbay.com. To receive future press
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releases via e-mail, please submit a request through http://investors.avalonbay.com/email_notification.

In addition to the Attachments, the Company is providing a teleconference presentation that will be available on the Company's website at http://investors.avalonbay.com subsequent to this release and before the market opens on February 9, 2023.

About AvalonBay Communities, Inc.

As of December 31, 2022, the Company owned or held a direct or indirect ownership interest in 294 apartment communities containing 88,475 apartment homes in 12 states and the District of Columbia, of which 18 communities were under development and one community was under redevelopment. The Company is an equity REIT in the business of developing, redeveloping, acquiring and managing apartment communities in leading metropolitan areas in New England, the New York/New Jersey Metro area, the Mid-Atlantic, the Pacific Northwest, and Northern and Southern California, as well as in the Company's expansion markets of Raleigh-Durham and Charlotte, North Carolina, Southeast Florida, Dallas and Austin, Texas, and Denver, Colorado. More information may be found on the Company’s website at http://www.avalonbay.com. For additional information, please contact Jason Reilley, Vice President of Investor Relations, at 703-317-4681.

Forward-Looking Statements

This release, including its Attachments, 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. These forward-looking statements, which you can identify by the Company’s use of words such as “expects,” “plans,” “estimates,” “anticipates,” “projects,” “intends,” “believes,” “outlook,” "may," "shall," "will," "pursue" and similar expressions that predict or indicate future events and trends and that do not report historical matters, are based on the Company’s expectations, forecasts and assumptions at the time of this release, which may not be realized and involve risks and uncertainties that cannot be predicted accurately or that might not be anticipated. These could cause actual results, performance or achievements to differ materially from the anticipated future results, performance or achievements expressed or implied by the forward-looking statements. Risks and uncertainties that might cause such differences include the following: we may abandon development or redevelopment opportunities for which we have already incurred costs; adverse capital and credit market conditions, including rising interest rates, may affect
our access to various sources of capital and/or cost of capital, which may affect our business activities, earnings and common stock price, among other things; changes in local employment conditions, demand for apartment homes, supply of competitive housing products, landlord-tenant laws, including the adoption of new rent control regulations, and other economic or regulatory conditions may result in lower than expected occupancy and/or rental rates and adversely affect the profitability of our communities; delays in completing development, redevelopment and/or lease-up, and general price inflation, may result in increased financing and construction costs and may delay and/or reduce the profitability of a community; debt and/or equity financing for development, redevelopment or acquisitions of communities may not be available or may not be available on favorable terms; we may be unable to obtain, or experience delays in obtaining, necessary governmental permits and authorizations; expenses may result in communities that we develop or redevelop failing to achieve expected profitability; our assumptions concerning risks relating to joint ventures and our ability to successfully dispose of certain assets may not be realized; investments made under the Structured Investment Program in either mezzanine debt or preferred equity of third-party multifamily development may not be repaid as expected; our assumptions and expectations in our financial outlook may prove to be too optimistic; the timing and net proceeds of condominium sales at The Park Loggia may not equal our current expectations; litigation costs and consequences may exceed our expectations; and risks related to pandemics, including the effect, among other factors, on the multifamily industry and the general economy of measures taken by businesses and the government, such as governmental limitations on the ability of multifamily owners to evict residents who are delinquent in the payment of their rent, the preferences of consumers and businesses for living and working arrangements, and federal efforts at economic stimulus. Additional discussions of risks and uncertainties that could cause actual results to differ materially from those expressed or implied by the forward-looking statements appear in the Company’s filings with the Securities and Exchange Commission, including the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021 under the heading “Risk Factors” and under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations - Forward-Looking Statements” and in subsequent quarterly reports on Form 10-Q.

The Company does not undertake a duty to update forward-looking statements, including its expected 2023 operating results and other financial data forecasts contained in this release. The Company may, in its discretion, provide
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information in future public announcements regarding its outlook that may be of interest to the investment community. The format and extent of future outlooks may be different from the format and extent of the information contained in this release.
 
Definitions and Reconciliations

Non-GAAP financial measures and other capitalized terms, as used in this earnings release, are defined, reconciled and further explained on Attachment 14, Definitions and Reconciliations of Non-GAAP Financial Measures and Other Terms. Attachment 14 is included in the full earnings release available at the Company’s website at http://investors.avalonbay.com.

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er-q4x2022.jpg
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 FOURTH QUARTER 2022
 
Supplemental Operating and Financial Data
 
Table of Contents
 
Company Profile  
Condensed Consolidated Operating Information..........................................................................................................Attachment 1
Condensed Consolidated Balance Sheets....................................................................................................................Attachment 2
Sequential Operating Information.................................................................................................................................Attachment 3
  
Market Profile - Same Store  
Quarterly Residential Rental Revenue and Occupancy Changes................................................................................Attachment 4
Sequential Quarterly Residential Rental Revenue and Occupancy Changes..............................................................Attachment 5
Full Year Residential Rental Revenue and Occupancy Changes.................................................................................Attachment 6
Residential Operating Expenses ("Opex")....................................................................................................................Attachment 7
  
Development, Joint Venture, Debt Profile and Disposition Activity  
Expensed Community Maintenance Costs and Capitalized Community Expenditures................................................Attachment 8
Development Communities...........................................................................................................................................Attachment 9
Unconsolidated Real Estate Investments.....................................................................................................................Attachment 10
Debt Structure and Select Debt Metrics........................................................................................................................Attachment 11
Summary of Disposition Activity....................................................................................................................................Attachment 12
Financial Outlook
2023 Financial Outlook.................................................................................................................................................Attachment 13
Definitions and Reconciliations  
Definitions and Reconciliations of Non-GAAP Financial Measures and Other Terms...................................................Attachment 14

 
The following is a "Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The projections and estimates contained in the following attachments, including but not limited to Attachments 9, 10, 13 and 14 contain forward-looking statements that involve risks and uncertainties, and actual results may differ materially from those projected in such statements. Risks associated with the Company's development, redevelopment, construction, and lease-up activities which could impact the forward-looking statements are discussed in the paragraph titled "Forward-Looking Statements" in the release that accompanies, and should be read in conjunction with, these attachments. These and other risks are also described in the Company's filings with the Securities and Exchange Commission, including the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2021 and the Company's Quarterly Reports on Form 10-Q for subsequent quarters, and could cause actual results to differ materially from such projections and estimates.
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Attachment 1
AvalonBay Communities, Inc.
Condensed Consolidated Operating Information
December 31, 2022
(Dollars in thousands except per share data)
(unaudited)
Q4Q4Full YearFull Year
20222021% Change20222021% Change
Revenue:   
Rental and other income$666,394 $600,494 11.0 %$2,587,113 $2,291,766 12.9 %
Management, development and other fees3,279 703 366.4 %6,333 3,084 105.4 %
Total669,673 601,197 11.4 %2,593,446 2,294,850 13.0 %
Operating expenses:
Direct property operating expenses, excluding property taxes127,411 115,218 10.6 %509,529 469,123 8.6 %
Property taxes72,266 70,571 2.4 %288,960 283,089 2.1 %
Total community operating expenses199,677 185,789 7.5 %798,489 752,212 6.2 %
Property management and other indirect operating expenses(29,463)(25,258)16.6 %(120,625)(101,730)18.6 %
Expensed transaction, development and other pursuit costs, net of recoveries (1)(6,700)(1,331)403.4 %(16,565)(3,231)412.7 %
Interest expense, net (1)(57,461)(55,711)3.1 %(230,074)(220,415)4.4 %
Loss on extinguishment of debt, net— (19)100.0 %(1,646)(17,787)(90.7)%
Depreciation expense(207,232)(197,036)5.2 %(814,978)(758,596)7.4 %
General and administrative expense (1)(20,741)(16,481)25.8 %(74,064)(69,611)6.4 %
Casualty loss— (2)100.0 %— (3,119)100.0 %
Income from investments in unconsolidated entities6,820 5,626 21.2 %53,394 38,585 38.4 %
Gain on sale of communities88,065 213,881 (58.8)%555,558 602,235 (7.8)%
Gain on other real estate transactions, net4,944 95 N/A5,039 2,097 140.3 %
Net for-sale condominium activity (2)(381)425 N/A88 (977)N/A
Income before income taxes247,847 339,597 (27.0)%1,151,084 1,010,089 14.0 %
Income tax expense (1)(6,683)(4,299)55.5 %(14,646)(5,733)155.5 %
Net income241,164 335,298 (28.1)%1,136,438 1,004,356 13.2 %
Net loss (income) attributable to noncontrolling interests 129 (89)N/A337 (57)N/A
Net income attributable to common stockholders$241,293 $335,209 (28.0)%$1,136,775 $1,004,299 13.2 %
Net income attributable to common stockholders per common share - basic$1.72 $2.40 (28.3)%$8.13 $7.19 13.1 %
Net income attributable to common stockholders per common share - diluted$1.72 $2.40 (28.3)%$8.12 $7.19 12.9 %
FFO (1)$359,135 $317,091 13.3 %$1,353,732 $1,135,681 19.2 %
Per common share - diluted$2.57 $2.27 13.2 %$9.67 $8.13 18.9 %
Core FFO (1)$363,087 $317,551 14.3 %$1,369,999 $1,153,472 18.8 %
Per common share - diluted$2.59 $2.27 14.1 %$9.79 $8.26 18.5 %
Dividends declared - common$222,911 $222,658 0.1 %$891,190 $890,001 0.1 %
Per common share$1.59 $1.59 — %$6.36 $6.36 — %
Average shares and participating securities outstanding - basic139,956,721 139,790,984 0.1 %139,891,551 139,681,493 0.2 %
Average shares outstanding - diluted140,007,823 139,928,816 0.1 %139,975,087 139,717,399 0.2 %
Total outstanding common shares and operating partnership units139,924,364 139,759,426 0.1 %139,924,364 139,759,426 0.1 %
(1)Amounts include non-Core items as detailed in Attachment 14 - Definitions and Reconciliations of Non-GAAP Financial Measures and Other Terms, table 2.
(2)Amounts include $485 and $634 of for-sale condominium marketing, operating and administrative costs and are offset by $104 and $1,059 of gains on for-sale condominiums for the three months ended December 31, 2022 and 2021, respectively. Amounts include $2,129 and $4,087 of for-sale condominium marketing, operating and administrative costs and are offset by $2,217 and $3,110 of gains on for-sale condominiums for the years ended December 31, 2022 and 2021, respectively. See Attachment 14 - Definitions and Reconciliations of Non-GAAP Financial Measures and Other Terms, table 2.
10


Attachment 2
 
AvalonBay Communities, Inc.
Condensed Consolidated Balance Sheets
December 31, 2022
(Dollars in thousands)
(unaudited)
 
 December 31,December 31,
 20222021
Real estate$24,619,616 $23,799,947 
Less accumulated depreciation(6,878,556)(6,208,610)
Net operating real estate17,741,060 17,591,337 
Construction in progress, including land1,072,543 807,101 
Land held for development179,204 147,546 
For-sale condominium inventory (1)32,532 146,535 
Real estate assets held for sale, net— 17,065 
Total real estate, net19,025,339 18,709,584 
Cash and cash equivalents613,189 420,251 
Cash in escrow121,056 123,537 
Resident security deposits36,815 33,757 
Investments in unconsolidated entities212,084 216,390 
Other assets449,281 398,497 
Total assets$20,457,764 $19,902,016 
Unsecured notes, net$7,602,305 $7,349,394 
Unsecured credit facility and commercial paper— — 
Notes payable, net713,740 754,153 
Resident security deposits63,700 59,787 
Other liabilities821,781 802,221 
Total liabilities9,201,526 8,965,555 
Redeemable noncontrolling interests2,685 3,368 
Equity11,253,553 10,933,093 
Total liabilities and equity$20,457,764 $19,902,016 
(1)Consists of the aggregate carrying value of the unsold for-sale residential condominiums of The Park Loggia.

11


Attachment 3
AvalonBay Communities, Inc.
Sequential Operating Information (1)
December 31, 2022
(Dollars in thousands, except per home data)
(unaudited)
Total Apartment
Homes
Quarter Ended
December 31, 2022
Quarter Ended
September 30, 2022
Quarter Ended
June 30,
2022
Quarter Ended
March 31,
2022
Quarter Ended
December 31, 2021
Residential Rental Revenue (2)  
Same Store69,493 $571,828 $567,890 $555,528 $528,879 $518,381 
Other Stabilized (3)7,527 54,061 50,495 45,104 41,633 37,950 
Development/Redevelopment (4)8,733 26,883 24,436 20,796 17,176 14,545 
Commercial Rental Revenue (2)N/A10,891 12,577 9,235 9,924 9,284 
     Total Rental Revenue85,753 $663,663 $655,398 $630,663 $597,612 $580,160 
Residential Operating Expense
Same Store$171,600 $179,907 $168,458 $165,504 $158,572 
Other Stabilized (3)17,824 17,814 14,668 15,178 13,160 
Development/Redevelopment8,238 8,132 6,879 5,177 5,216 
Commercial Operating Expense1,649 1,572 1,562 1,700 1,339 
Total Operating Expense$199,311 $207,425 $191,567 $187,559 $178,287 
Residential NOI (5)
Same Store$400,722 $388,397 $387,555 $363,716 $360,149 
Other Stabilized (3)37,095 33,432 30,973 26,846 25,081 
Development/Redevelopment18,656 16,318 13,925 12,007 9,338 
Commercial NOI (5)9,242 11,005 7,673 8,224 7,945 
Total NOI$465,715 $449,152 $440,126 $410,793 $402,513 
Same Store Average Rental Revenue per Occupied Home (6)$2,861 $2,839 $2,766 $2,634 $2,586 
Same Store Economic Occupancy95.9 %96.0 %96.4 %96.3 %96.2 %
Same Store Turnover (7)
Current year period / Prior year period38.8% / 37.5%55.0% / 55.8%46.8% / 50.8%35.3% / 44.2%37.5% / 47.9%
Current year / Prior year44.0% / 47.1%47.1% / 52.7%
SAME STORE LIKE-TERM EFFECTIVE RENT CHANGE (5)
October 2022November 2022December 2022January 2023
  New England7.0 %4.6 %3.9 %4.9 %
  Metro NY/NJ8.8 %7.3 %5.4 %5.7 %
  Mid-Atlantic6.2 %5.8 %4.9 %2.3 %
  Southeast FL7.4 %7.9 %8.9 %7.3 %
  Denver, CO5.3 %4.6 %2.5 %1.9 %
  Pacific NW5.2 %2.7 %1.1 %3.0 %
  N. California3.8 %3.4 %2.5 %2.6 %
  S. California5.2 %5.3 %2.6 %2.4 %
     Total6.2 %5.1 %3.6 %3.6 %
(1)Includes consolidated communities and excludes communities that have been sold or that are classified as held for sale.
(2)Rental revenue excludes non-qualified REIT income.
(3)Results for these communities prior to January 1, 2022 may reflect operations prior to stabilization, including lease-up, such that occupancy is not stabilized.
(4)For per home rent projections and Economic Occupancy for Development communities currently under construction, see Attachment 9 - Development Communities.
(5)See Attachment 14 - Definitions and Reconciliations of Non-GAAP Financial Measures and Other Terms.
(6)Reflects the effect of Residential concessions amortized over the average lease term and includes uncollectible lease revenue and revenue from government rent relief programs.
(7)Turnover is the annualized number of units turned over during the period, divided by the total number of Same Store apartment homes for the respective period.
12


Attachment 4
AvalonBay Communities, Inc.
Quarterly Residential Rental Revenue and Occupancy Changes - Same Store (1)
December 31, 2022
(unaudited)
 Apartment HomesAverage Monthly Rental Revenue
Per Occupied Home
Economic OccupancyResidential Rental Revenue ($000s)(2)
% Change Excluding
Rent Relief (3)
  Q4 22Q4 21% ChangeQ4 22Q4 21% ChangeQ4 22Q4 21% Change
          
  New England9,618 $3,206 $2,827 13.4 %96.7 %96.8 %(0.1)%$89,478 $78,967 13.3 %14.7 %
  Metro NY/NJ
     New York City, NY3,788 3,936 3,321 18.5 %97.0 %96.9 %0.1 %43,402 36,602 18.6 %19.1 %
     New York - Suburban3,202 3,595 3,368 6.7 %95.3 %96.2 %(0.9)%32,907 31,097 5.8 %7.1 %
     New Jersey4,651 3,286 2,837 15.8 %96.3 %97.6 %(1.3)%44,157 38,567 14.5 %15.8 %
  Metro NY/NJ11,641 3,583 3,139 14.1 %96.3 %97.0 %(0.7)%120,466 106,266 13.4 %14.4 %
  Mid-Atlantic
     Washington Metro11,015 2,411 2,211 9.0 %94.8 %95.3 %(0.5)%75,562 69,617 8.5 %9.3 %
     Baltimore, MD1,562 2,035 1,875 8.5 %95.8 %97.4 %(1.6)%9,139 8,546 6.9 %7.2 %
  Mid-Atlantic12,577 2,364 2,170 8.9 %95.0 %95.5 %(0.5)%84,701 78,163 8.4 %9.0 %
  Southeast FL1,214 2,861 2,426 17.9 %96.7 %97.2 %(0.5)%10,082 8,589 17.4 %18.0 %
  Denver, CO1,086 2,246 1,995 12.6 %95.4 %94.8 %0.6 %6,979 6,166 13.2 %12.7 %
  Pacific Northwest4,807 2,638 2,313 14.1 %94.5 %94.4 %0.1 %35,953 31,487 14.2 %14.6 %
  Northern California
     San Jose, CA4,723 2,918 2,619 11.4 %95.6 %96.5 %(0.9)%39,521 35,750 10.5 %11.5 %
     Oakland - East Bay, CA4,138 2,647 2,474 7.0 %96.2 %95.9 %0.3 %31,596 29,453 7.3 %8.5 %
     San Francisco, CA3,267 3,325 2,998 10.9 %95.8 %95.5 %0.3 %31,207 28,062 11.2 %13.8 %
  Northern California12,128 2,935 2,670 9.9 %95.8 %96.0 %(0.2)%102,324 93,265 9.7 %11.3 %
  Southern California
     Los Angeles, CA11,284 2,543 2,462 3.3 %96.2 %95.9 %0.3 %82,822 79,910 3.6 %15.0 %
     Orange County, CA3,371 2,647 2,388 10.8 %94.8 %96.3 %(1.5)%25,391 23,240 9.3 %12.9 %
     San Diego, CA1,767 2,685 2,414 11.2 %95.8 %96.4 %(0.6)%13,632 12,328 10.6 %13.0 %
  Southern California16,422 2,579 2,442 5.6 %95.9 %96.0 %(0.1)%121,845 115,478 5.5 %14.3 %
        Total Same Store69,493 $2,861 $2,586 10.6 %95.9 %96.2 %(0.3)%$571,828 $518,381 10.3 %13.1 %

(1) Same Store is composed of communities with Stabilized Operations as of January 1, 2021 such that a comparison of Q4 2021 to Q4 2022 is meaningful.
(2) Reflects Residential concessions amortized over the average lease term and includes uncollectible lease revenue and revenue from government rent relief programs. Residential Rental Revenue with Concessions on a Cash Basis
for the Company's Same Store portfolio was 8.4%. See Attachment 14, table 9.
(3) Represents the change in Residential Rental Revenue adjusted to remove the impact of governmental rent relief in the periods presented. See Attachment 14, table 10 for further detail of uncollectible lease revenue and government
rent relief for the Company's Same Store portfolio.
13


Attachment 5
AvalonBay Communities, Inc.
Sequential Quarterly Residential Rental Revenue and Occupancy Changes - Same Store (1)
December 31, 2022
(unaudited)
 Apartment HomesAverage Monthly Rental Revenue
Per Occupied Home
Economic OccupancyResidential Rental Revenue ($000s)(2)
% Change Excluding
Rent Relief (3)
  Q4 22Q3 22% ChangeQ4 22Q3 22% ChangeQ4 22Q3 22% Change
          
  New England9,618 $3,206 $3,166 1.3 %96.7 %96.9 %(0.2)%$89,478 $88,490 1.1 %1.2 %
  Metro NY/NJ
     New York City, NY3,788 3,936 3,871 1.7 %97.0 %97.2 %(0.2)%43,402 42,777 1.5 %2.1 %
     New York - Suburban3,202 3,595 3,585 0.3 %95.3 %94.6 %0.7 %32,907 32,566 1.0 %2.0 %
     New Jersey4,651 3,286 3,255 1.0 %96.3 %96.0 %0.3 %44,157 43,581 1.3 %0.9 %
  Metro NY/NJ11,641 3,583 3,546 1.0 %96.3 %96.0 %0.3 %120,466 118,924 1.3 %1.6 %
  Mid-Atlantic
     Washington Metro11,015 2,411 2,400 0.5 %94.8 %94.9 %(0.1)%75,562 75,271 0.4 %0.6 %
     Baltimore, MD1,562 2,035 2,017 0.9 %95.8 %96.1 %(0.3)%9,139 9,087 0.6 %0.0 %
  Mid-Atlantic12,577 2,364 2,352 0.5 %95.0 %95.1 %(0.1)%84,701 84,358 0.4 %0.5 %
  Southeast FL1,214 2,861 2,784 2.8 %96.7 %94.9 %1.8 %10,082 9,642 4.6 %4.5 %
  Denver, CO1,086 2,246 2,210 1.6 %95.4 %95.7 %(0.3)%6,979 6,891 1.3 %0.7 %
  Pacific Northwest4,807 2,638 2,642 (0.2)%94.5 %95.1 %(0.6)%35,953 36,232 (0.8)%(0.7)%
  Northern California
     San Jose, CA4,723 2,918 2,897 0.7 %95.6 %95.6 %0.0 %39,521 39,255 0.7 %1.0 %
     Oakland - East Bay, CA4,138 2,647 2,666 (0.7)%96.2 %96.0 %0.2 %31,596 31,757 (0.5)%0.9 %
     San Francisco, CA3,267 3,325 3,277 1.5 %95.8 %95.4 %0.4 %31,207 30,633 1.9 %2.3 %
  Northern California12,128 2,935 2,918 0.6 %95.8 %95.7 %0.1 %102,324 101,645 0.7 %1.3 %
  Southern California
     Los Angeles, CA11,284 2,543 2,544 0.0 %96.2 %96.5 %(0.3)%82,822 83,082 (0.3)%1.1 %
     Orange County, CA3,371 2,647 2,567 3.1 %94.8 %95.9 %(1.1)%25,391 24,892 2.0 %2.4 %
     San Diego, CA1,767 2,685 2,658 1.0 %95.8 %97.5 %(1.7)%13,632 13,734 (0.7)%0.6 %
  Southern California16,422 2,579 2,561 0.7 %95.9 %96.5 %(0.6)%121,845 121,708 0.1 %1.3 %
        Total Same Store69,493 $2,861 $2,839 0.8 %95.9 %96.0 %(0.1)%$571,828 $567,890 0.7 %1.2 %

(1) Same Store is composed of communities with Stabilized Operations as of January 1, 2021.
(2) Reflects Residential concessions amortized over the average lease term and includes uncollectible lease revenue and revenue from government rent relief programs. Residential Rental Revenue with Concessions on a Cash Basis
for the Company's Same Store portfolio was 0.2%. See Attachment 14, table 9.
(3) Represents the change in Residential Rental Revenue adjusted to remove the impact of governmental rent relief in the periods presented. See Attachment 14, table 10 for further detail of uncollectible lease revenue and government
rent relief for the Company's Same Store portfolio.
14


Attachment 6
AvalonBay Communities, Inc.
Full Year Residential Rental Revenue and Occupancy Changes - Same Store (1)
December 31, 2022
(unaudited)
 Apartment HomesAverage Monthly Rental Revenue
Per Occupied Home
Economic OccupancyResidential Rental Revenue ($000s)(2)
% Change Excluding
Rent Relief (3)
 Full Year 2022Full Year 2021% ChangeFull Year 2022Full Year 2021% ChangeFull Year 2022Full Year 2021% Change
  New England9,618 $3,064 $2,744 11.7 %97.0 %96.2 %0.8 %$343,179 $305,040 12.5 %12.5 %
  Metro NY/NJ
     New York City, NY3,788 3,717 3,222 15.4 %97.2 %96.7 %0.5 %164,170 141,699 15.9 %15.5 %
     New York - Suburban3,202 3,511 3,253 7.9 %95.3 %95.9 %(0.6)%128,535 119,741 7.3 %6.9 %
     New Jersey4,651 3,123 2,768 12.8 %96.4 %96.6 %(0.2)%168,069 149,286 12.6 %12.9 %
  Metro NY/NJ11,641 3,423 3,048 12.3 %96.4 %96.5 %(0.1)%460,774 410,726 12.2 %12.1 %
  Mid-Atlantic
     Washington Metro11,015 2,343 2,186 7.2 %95.1 %95.0 %0.1 %294,552 274,425 7.3 %7.4 %
     Baltimore, MD1,562 1,976 1,816 8.8 %96.5 %97.4 %(0.9)%35,720 33,104 7.9 %7.4 %
  Mid-Atlantic12,577 2,297 2,140 7.3 %95.3 %95.2 %0.1 %330,272 307,529 7.4 %7.4 %
  Southeast FL1,214 2,734 2,253 21.3 %95.9 %96.5 %(0.6)%38,206 31,644 20.7 %19.6 %
  Denver, CO1,086 2,151 1,896 13.4 %95.8 %96.1 %(0.3)%26,845 23,739 13.1 %12.9 %
  Pacific Northwest4,807 2,555 2,218 15.2 %95.2 %95.1 %0.1 %140,384 121,791 15.3 %15.3 %
  Northern California
     San Jose, CA4,723 2,827 2,605 8.5 %96.0 %96.3 %(0.3)%153,887 142,172 8.2 %8.1 %
     Oakland - East Bay, CA4,138 2,600 2,449 6.2 %96.1 %95.9 %0.2 %124,085 116,633 6.4 %5.7 %
     San Francisco, CA3,267 3,237 2,928 10.6 %95.5 %95.5 %0.0 %121,180 109,614 10.6 %10.5 %
  Northern California12,128 2,860 2,640 8.3 %95.9 %95.9 %0.0 %399,152 368,419 8.3 %8.1 %
  Southern California
     Los Angeles, CA11,284 2,550 2,304 10.7 %96.4 %96.3 %0.1 %333,002 300,519 10.8 %10.7 %
     Orange County, CA3,371 2,552 2,270 12.4 %96.0 %96.9 %(0.9)%99,077 88,854 11.5 %11.9 %
     San Diego, CA1,767 2,591 2,295 12.9 %96.9 %96.9 %0.0 %53,234 47,172 12.9 %13.5 %
  Southern California16,422 2,555 2,296 11.3 %96.4 %96.5 %(0.1)%485,313 436,545 11.2 %11.3 %
        Total Same Store69,493 $2,774 $2,504 10.8 %96.1 %96.0 %0.1 %$2,224,125 $2,005,433 10.9 %10.8 %

(1) Same Store is composed of communities with Stabilized Operations as of January 1, 2021 such that a comparison of full year 2021 to full year 2022 is meaningful.
(2) Reflects Residential concessions amortized over the average lease term and includes uncollectible lease revenue and revenue from government rent relief programs. Residential Rental Revenue with Concessions on a Cash Basis
for the Company's Same Store portfolio was 10.4%. See Attachment 14, table 9.
(3) Represents the change in Residential Rental Revenue adjusted to remove the impact of governmental rent relief in the periods presented. See Attachment 14, table 10 for further detail of uncollectible lease revenue and government
rent relief for the Company's Same Store portfolio.
15


Attachment 7
AvalonBay Communities, Inc.
Residential Operating Expenses ("Opex") - Same Store (1)
December 31, 2022
(Dollars in thousands)
(unaudited)
Q4
2022
Q4
2021
% ChangeQ4 2022 % of
Total Opex
Full Year
2022
Full Year
2021
% ChangeFull Year 2022 % of
Total Opex
Property taxes (2)$61,366 $58,589 4.7 %35.8 %$242,742 $236,898 2.5 %35.4 %
Payroll (3)35,203 32,800 7.3 %20.5 %143,525 140,325 2.3 %20.9 %
Repairs & maintenance (4)29,959 27,147 10.4 %17.4 %121,846 113,398 7.4 %17.8 %
Utilities (5)19,941 15,907 25.4 %11.6 %74,894 62,272 20.3 %10.9 %
Office operations (6)16,134 13,470 19.8 %9.4 %61,503 51,522 19.4 %9.0 %
Insurance (7)5,994 7,057 (15.1)%3.5 %27,935 27,961 (0.1)%4.1 %
Marketing (8)3,003 3,602 (16.6)%1.8 %13,024 14,078 (7.5)%1.9 %
Total Same Store Residential Operating Expenses$171,600 $158,572 8.2 %100.0 %$685,469 $646,454 6.0 %100.0 %

(1)Same Store operating expenses exclude indirect costs for corporate-level property management and other support-related expenses.
(2)Property taxes increased for the three months and year ended December 31, 2022 over the prior year periods due to (i) increased assessments across the portfolio and (ii) the expiration of property tax incentive programs at certain of our properties in New York City. The increase for the year ended December 31, 2022 is partially offset by successful appeals in the current year in excess of the prior year. The expiration of property tax incentive programs represents $1,130 or 41% of the 4.7% increase in property taxes for the three months ended December 31, 2022 and $3,898 or 67% of the 2.5% increase in property taxes for the year ended December 31, 2022.
(3)Payroll costs increased for the three months and year ended December 31, 2022 over the prior year periods primarily due to a refundable payroll tax credit in the prior year periods, merit increases, benefits costs and maintenance overtime, partially offset by a reduction in on-site leasing and administrative personnel.
(4)Repairs and maintenance increased for the three months and year ended December 31, 2022 over the prior year periods due to increased turnover costs as well as common area amenities which re-opened in 2022 and a decrease in rebates as compared to the prior year periods.
(5)Utilities represents aggregate utility costs, net of resident reimbursements. The increases for the three months and year ended December 31, 2022 over the prior year periods are primarily due to the Company’s implementation of a bulk internet offering at its communities, which is more than offset by bulk internet revenue, as well as increases in electricity rates and trash removal. The increase for the year ended December 31, 2022 is also due to increased gas rates, water and sewer charges and a refund for water and sewer in the prior year not present in the current year.
(6)Office operations includes administrative costs, legal and eviction costs, land lease expense and association and license fees. The increases for the three months and year ended December 31, 2022 over the prior year periods are primarily due to (i) bad debt expense associated with amounts due from residents for utility reimbursements, damage receipts and other related items, (ii) credit card fees (which are offset in revenue) and (iii) furnished housing furniture rental costs which are more than offset by furnished housing revenue premiums. The increase for the year ended December 31, 2022 over the prior year is also due to government licenses and association fees in Northern California.
(7)Insurance is composed of premiums, expected claims activity and associated reductions from receipt of claims recoveries. The decrease for the three months ended December 31, 2022 from the prior year period is due to the timing of claims, partially offset by increased property insurance premiums. Insurance costs can be variable due to the amounts and timing of estimated and actual claim activity and the related recoveries received.
(8)Marketing costs decreased for the three months and year ended December 31, 2022 from the prior year period due to decreased internet advertising costs and third-party call center costs.
16


Attachment 8
AvalonBay Communities, Inc.
Expensed Community Maintenance Costs and Capitalized Community Expenditures
December 31, 2022
(Dollars in thousands except per home data)
(unaudited)
Full Year 2022 Maintenance
Expensed Per Home
Categorization of Full Year 2022
Additional Capitalized Value (2)
Current Communities Apartment Homes (1)Carpet ReplacementOther Maintenance (3)TotalAcquisitions, Construction, Redevelopment & Dispositions (4)NOI Enhancing (5)Asset Preservation2022 Additional Capitalized ValueNOI Enhancing Per HomeAsset Preservation Per Home
Same Store69,493 $122 $2,709 $2,831 $62,448 (6)$37,647 $109,512 $209,607 $542 $1,576 
Other Stabilized7,527 44 2,102 2,146 547,802 (7)413 2,662 550,877 $55 $354 
Development/Redevelopment (8)8,733 22 787 809 816,630 — — 816,630 — — 
Dispositions (9)— — — — (622,722)— — (622,722)— — 
        Total 85,753 $105 $2,460 $2,565 $804,158 $38,060 $112,174 $954,392 N/AN/A

(1)Includes consolidated communities and excludes communities that have been sold or that are classified as held for sale.
(2)Expenditures are capitalized for the acquisition or development of new assets or for expenditures that extend the life of existing assets and benefit the Company for periods greater than a year.
(3)Other maintenance includes maintenance, landscaping and redecorating costs, as well as maintenance related payroll expense.
(4)Includes the write-off of impaired assets and additional capitalized expenditures related to recognized casualty losses, if applicable.
(5)This Attachment excludes capitalized expenditures for the commercial component of communities, which the Company classifies as NOI Enhancing. Same Store and Other Stabilized exclude $748 and $8,902, respectively, related to commercial space.
(6)Consists primarily of expenditures for communities under redevelopment that have remained in Same Store with stabilized occupancy.
(7)Represents acquired communities coupled with commi