ESS

A month has gone by since the last earnings report for Essex Property Trust (ESS). Shares have lost about 0.4% in that time frame, underperforming the S&P 500. But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is Essex Property Trust due for a breakout? Well, first let's take a quick look at its latest earnings report in order to get a better handle on the recent drivers for Essex Property Trust, Inc. before we dive into how investors and analysts have reacted as of late. Essex Property Trust reported second-quarter 2026 core FFO per share of $4.08, beating the Zacks Consensus Estimate of $4.03. The figure also increased 1.2% from the year-ago quarter. The outperformance reflected higher same-property and non-same-property NOI. ESS raised its 2026 FFO per share guidance. Total revenues were $489.05 million, which rose 4.1% year over year and came ahead of the consensus mark of $487.32 million. Same-property revenues and NOI grew 2.7% and 2.6%, respectively, while financial occupancy edged up 10 basis points year over year to 96.3%. Same-property revenue growth was primarily driven by a 2.2% increase in scheduled rents. Other income contributed another 0.6%, while delinquency reduced growth by 0.1%. Cash concessions and vacancy had no year-over-year impact. Sequentially, same-property revenues improved 0.8% from the first quarter of 2026. Scheduled rents added 0.9%, and other income contributed 0.2%. These gains were partly offset by a 0.2% vacancy impact and a 0.1% delinquency drag. Northern California remained the strongest part of Essex Property’s West Coast portfolio. Same-property revenues in the region increased 4.4% year over year, while operating expenses declined 1.2%. Regional NOI advanced 6.8%. Northern California also achieved 1.8% sequential revenue growth and a 3.4% increase in NOI. Southern California revenues grew 1.5%, with NOI up 1.1%. Seattle Metro revenues increased 1.7%, but a 14.2% surge in operating expenses resulted in a 2.7% decline in NOI. Same-property financial occupancy was 96.3% at quarter-end compared with 96.2% a year earlier and 96.5% at the end of the first quarter. The modest sequential decline accompanied positive revenue growth across the overall portfolio. Northern California posted the highest occupancy at 96.8%, up from 96.6% a year ago. Seattle’s occupancy was unchanged at 96.4%, while Southern California improved 10 basis points year over year to 95.7%. Same-property operating expenses increased 2.8% from the prior-year quarter. Despite the expense growth, portfolio NOI reached $316.8 million, up from $308.7 million a year earlier. During the quarter, a joint venture in which Essex holds a 50% interest sold a 218-unit apartment community in San Jose for $105.3 million. The company’s pro rata share of the transaction was $52.6 million, and it recorded a $9.2 million gain. Essex also received $87.8 million from the full redemption of three structured finance investments. These investments generated a weighted average return of 11.6%. Subsequent to quarter-end, another 50%-owned joint venture originated two preferred equity investments totaling $36.2 million, or $18.1 million at Essex’s share. The investments carry an initial preferred return of 11.5%. Essex ended June with approximately $1.4 billion of liquidity. This included $1.23 billion of available unsecured commitments and $167 million of cash, equivalents, marketable securities and undrawn equity forward contracts. Net indebtedness to adjusted EBITDAre improved to 5.4X from 5.5X in both the prior quarter and the year-ago period. Debt to total assets was 34%, while 93% of adjusted NOI came from unencumbered assets. The company repurchased 48,261 shares during the quarter for $11.7 million. Year to date, it bought back 254,001 shares for $61.9 million and retained $500 million of repurchase authority at quarter-end. Essex raised its full-year 2026 core FFO guidance to $16.03-$16.25 per share from $15.69-$16.19. The revised midpoint of $16.14 represents a 20-cent increase. For the third quarter, Essex expects core FFO per share of $3.93-$4.05. Management also lifted its same-property revenue growth outlook to 2.5%-3.1% from 1.7%-3.1%. The NOI growth range was raised to 2.3%-3.3% from 0.8%-3.4%, while the operating expense range was narrowed to 2.5%-3%. In the past month, investors have witnessed a upward trend in estimates revision. Currently, Essex Property Trust has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. However, the stock was allocated a score of D on the value side, putting it in the bottom 40% for value investors. Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in. Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Interestingly, Essex Property Trust has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Essex Property Trust, Inc. (ESS) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Image source: The Motley Fool. Thursday, July 30, 2026 at 2:00 p.m. ET President and Chief Executive Officer - Angela Kleiman Barb Pak Rylan Burns Operator: Good day, and welcome to the Essex Property Trust Second Quarter 2026 Earnings Call. As a reminder, today's conference is being recorded. Statements made on this conference call regarding expected operating results and other future events are forward-looking statements that involve risks and uncertainties. Forward-looking statements are made based on current expectations, assumptions and beliefs as well as information available to the company at this time. A number of factors could cause actual results to differ materially from those anticipated. Further information about these risks can be found on the company's filings with the SEC. It is now my pleasure to introduce you to your host, Mrs. Angela Kleiman, President and Chief Executive Officer for Essex Property Trust. Thank you. You may begin. Angela Kleiman: Thank you for joining Essex's second quarter earnings call. Today, I will cover performance in the first half and outlook for the second half of the year, then conclude with an update on the transaction market. Barb Pak will follow with prepared remarks, and Rylan Burns is here for Q&A. We are pleased to report a solid first half of 2026, highlighted by a substantial outperformance led by strong executions from our operations team in delivering results exceeding our original expectations. While national economic and employment growth have been measured, West Coast multifamily fundamentals continue to demonstrate durability with limited housing supply across our markets and affordability favoring renting. As such, we are meaningfully raising our full year expectations for same-property revenues and core FFO per share, which Barb will cover in a moment. As for regional highlights, starting with Seattle, operating conditions improved in the second quarter with 2.6% blended rent growth, representing a 340 basis point sequential increase from the first quarter. Consistent with normal seasonality, market rents reached their peak around early July and are expected to moderate through the balance of the year. Performance has been stronger on the East Side, a benefit to our portfolio allocation, which achieved a 3.2% blended rents, a considerably higher growth rate than the 1% in the urban core. We are also encouraged by recent office expansion announcements from several notable companies. These trends are consistent with prior innovation cycles and reinforces Seattle's long-term position as a leading technology market. While it will take time for these commitments to translate into meaningful hiring, they represent a positive signal for future demand. More importantly, favorable outlook for this region is supported by declining supply deliveries, which continues to moderate. Turning to Northern California, which remains our strongest performing region and the leading multifamily market in the country, delivering blended rent growth of 6.5%, while concurrently maintaining strong occupancy. This performance is attributable to two key factors. First is the compelling supply-demand backdrop with limited housing deliveries and continued investments across the Bay Area from technology sector propelling demand. Second, positive migration trends as talent and entrepreneurs are drawn to the unique concentration of capital and innovation. As a result, we are experiencing growing momentum of demand for housing throughout the broader region. These fundamentals have translated into pricing power and outperformance relative to our original expectations, including peak leasing momentum extending beyond typical seasonal patterns. On to Southern California. The region remains closely tied to national economic trends with job growth generally in line with the U.S. average. Against this tempered employment backdrop, limited new supply has supported relatively stable operating conditions. Accordingly, we generated a 1.4% blended rent growth in the second quarter, led by Orange County, while Los Angeles lagged. Looking ahead to the second half of the year, we expect the broader economy to unfold generally consistent with our initial forecast for the year with modest job growth and continued macroeconomic and geopolitical uncertainty. While demand is highly correlated to the pace of job growth, West Coast multifamily fundamentals remain well positioned with attractive affordability for rental housing, combined with new apartment deliveries moderating across most of our markets. Lastly, on the transaction market. Investor interest in West Coast multifamily assets remain healthy with transaction volume increasing throughout the year across our markets despite a higher interest rate environment. Cap rates for institutional quality assets have generally remained in the mid-4% range, while the majority of transactions in Northern California pricing in the low 4% range. Overall, the strength of private market valuations reinforces the value of the capital we deployed in Northern California over the past several years. We will continue to evaluate acquisitions, dispositions and other investment opportunities based on the highest relative return with a focus on maximizing growth, NAV and FFO per share accretion. With that, I'll turn the call over to Barb. Barb Pak: Thanks, Angela. Today, I will recap our second quarter results, discuss key updates to our revised full year guidance and conclude with comments on the balance sheet. Starting with our second quarter results. We achieved another solid quarter with core FFO per share exceeding the midpoint of our guidance range by $0.10. The outperformance was primarily driven by operations with same-property NOI accounting for $0.05 and non-same-property NOI contributing an additional $0.03. As for the favorable variance within our same-property portfolio, it was comprised of revenue growth, which was 20 basis points ahead of plan. In addition, operating expenses came in lower than expected, which was driven by $0.03 of favorable property taxes, mainly due to successful Prop 8 appeals that are onetime in nature. The benefit from our non-same-property portfolio was largely attributable to prior year acquisitions in Northern California, which continue to perform ahead of plan due to strong rent growth in this region. Turning to our updated full year guidance. We are pleased to announce a $0.20 increase to the midpoint of core FFO per share, representing a 1.3% increase at the midpoint. Better operating performance within our portfolio is the key driver of the increase. As it relates to our same-property portfolio, we are raising the midpoint of NOI growth by 70 basis points to 2.8%. The increase is a result of 40 basis points improvement in revenue growth, which is driven by higher scheduled rent, occupancy and other income. In addition, we are lowering the midpoint of operating expense growth by 25 basis points, primarily reflecting the property tax savings previously discussed. Altogether, higher same-property growth contributed $0.12 to the full year increase. The balance of the increase to our guidance largely reflects better-than-expected performance within our non-same-property portfolio, as previously discussed. As for our third quarter core FFO guidance, we are forecasting $3.99 per share at the midpoint. The $0.09 sequential decline from the second quarter primarily reflects higher operating expenses, including normal seasonal increases in utilities and California property taxes as well as increased controllable spending during the second half of the year. As I mentioned last quarter, controllable expenses were lower than expected in the first quarter, which was timing related. And as such, we expect these expenses to be $0.09 higher in the second half of the year than the first half. Concluding with the balance sheet, we remain in a strong financial position with net debt-to-EBITDA of 5.4x, minimal debt maturities over the next 12 months, over $1 billion of available liquidity and access to multiple sources of capital. As such, we have ample flexibility to fund our commitments and capitalize on opportunities that support long-term growth. I will now turn the call back to operator for questions. Operator: Thank you. We'll now be conducting a question-and-answer session. [Operator Instructions] So that we may address as many participants as possible, we ask that you limit yourself to one question and one follow-up, and if time permitting, you may requeue to add any additional questions. [Operator Instructions] Thank you. Our first question comes from the line of Steve Sakwa with Evercore ISI. Steve Sakwa: Could you maybe just elaborate a little bit on some of the July trends that you're seeing? It feels like the market certainly improved quite dramatically from maybe the start of the second quarter to the end of the second quarter. And then I'm just curious how kind of spreads and renewals are trending in July and perhaps August? Angela Kleiman: Steve, thanks for your question. It's Angela here. Happy to. From -- maybe I'll start from the blend. I think that's a good data point. So July blends are coming in similar to the second quarter. And so I think things are moving along as planned and our fundamentals remain sound. And just for context, where July is coming in this year, it's slightly better than the same period last year. And so -- and if you want to compare from a year-over-year perspective, it's interesting how things are trending. So last year, we had a very strong first half and then a pretty significant drop in the second half. We're definitely not seeing that so far this year, and we are assuming that this year, first half and second half are quite similar. Steve Sakwa: Yes. I guess that's kind of the issue is that you're not seeing the drop-off and the market has been very strong. So I think maybe it would sort of imply that there should be more momentum into the back half of the year, but yet you're not really assuming that or maybe projecting that within guidance. So is there something holding you back on that? Or is that just conservatism on your part at this point in the year? Angela Kleiman: Yes, that's a good question, Steve. It's a little bit of both. So we are not anticipating a significant drop-off. And our base case is that we're going to land right at that 2.5% blended midpoint. And the reason we are not -- obviously, we have a range, which would point to a better performance. But what we're seeing on the ground here is that Northern California momentum remains strong. We actually haven't peaked yet, and that's fantastic. Having said that, the broad U.S. economy actually is slower this year than last year. And we are tethered to that, especially Southern California, including L.A. So a good data point I'll point you to is if you just look at job growth, job growth for the first half of this year is actually quite a bit slower or lower than the same period last year. And for those reasons and with the geopolitical uncertainty that remains, if we were 100% Northern California, obviously, our numbers will be very different, much more robust. But given that 40% of our footprint is still in Southern California, and it is tied to the broader economy, we needed to essentially make sure that we factor some of these uncertainties out there. But at the end of the day, if you look at Southern California, while it is a lag for the West Coast, it is still a solid long-term market, generating 1.4% blended rent growth with occupancy above 95%, it performs -- outperforms most of the major metros in the U.S. Operator: Our next question comes from the line of Brad Heffern with RBC Capital Markets. Brad Heffern: On new lease spreads, we were kind of surprised to see the new lease number so much lower than 2Q '25, just given all the strength in NorCal. You kind of covered it a little bit with your commentary about the broader economy, but I'm just wondering about the dynamic of lower new lease spreads year-over-year, but higher renewals and what's kind of driving that pricing decision? Angela Kleiman: Brad, thanks for your question. It's interesting how the different regions performance is quite a bit of variation there. And so in Northern California, we're definitely seeing very strong new lease spreads. But Southern California is not going to have that kind of strength. And of course, Seattle is somewhere in the middle. But overall, if you look at the combination of our composition of our portfolio, Southern California plus Seattle is 60%. And so that gives you a little bit more insight to the different components. And what we are seeing this year is that our renewal continues to be quite strong and coming in, in that 5% range. And with new lease, we're expecting that for the trend with that lower new lease to continue and elevated renewal to continue. Brad Heffern: Okay. And Barb, two things on the preferred book. So you had the close to $90 million in redemptions in the quarter, but the balance is only down about $40 million sequentially. So can you reconcile that? And then just also give your broader perspective on how the current balance should evolve in the coming quarters? Barb Pak: Yes. No, that's a good question. So the redemptions that we had this quarter, two were in the preferred equity book, that was the $40 million. And then one was a mezz investment, which sits in the notes and other receivables on the balance sheet. And so it's in two different buckets on the income statement and balance sheet. So that's why you didn't see it fully drop $90 million in that preferred line. And then what was your second question? Brad Heffern: Just how you expect the balance there to evolve. I think that was all the redemptions for the year, but I could be wrong. Barb Pak: Yes. We have one other small redemption in the third quarter, which was factored into our guidance originally, but it's offsetting by the new investment that we did. The book value that we're accruing on is $100 million. And I think that's a good run rate to use going forward for guidance purposes unless we do more investments. But at this point, $100 million seems like a good run rate. Operator: Our next question comes from the line of Eric Wolfe with Citi. Eric Wolfe: I think you mentioned a moment ago that you're still expecting like a 2.5% blended rate growth for the year. Apologies if I misheard that. But could you just talk about what drove the increase in your same-store revenue guidance, what the various components of the change were? Angela Kleiman: Yes. I'll cover the blend and Barb will talk about the revenue growth. So, just to confirm your question, yes, we are expecting for the full year to land at 2.5%. And I talked about that first year and second half to be similar and first half is coming in about 2.6%, which would imply that the second half comes in at 2.4%. So not a huge variation there. Barb? Barb Pak: And then in terms of the 40 basis points improvement to our same-store revenue growth, scheduled rent and other income each contribute 15 basis points to growth and then the other 10 basis points is from higher occupancy. Eric Wolfe: Got it. That's helpful. And then you spent some time talking about Seattle as well as Northern California. And I guess I'm just wondering, if you compare those markets, is it very obvious, I guess, that Northern California has sort of seen stronger demand, and it's just that they absorbed the supply earlier, and that's why you're seeing much more pricing power? Or I guess when you look at your dashboards and you look at traffic and you look at other things that signify demand, it's just NorCal just has a stronger demand right now. Angela Kleiman: Yes, it's a good question. A couple of things. With Northern California, it had a lower supply to start with relative to Seattle. Seattle last year was closer to 1% versus NorCal was half of that. So the base is very different and certainly is beneficial to Northern California. And your point as far as the demand is spot on. Demand starts with Northern California, and that's really the center of the innovation engine. And what we have seen over multiple cycles is that it starts with Northern California and then it expands out to Seattle. And we're already seeing announcements, public announcements of expansion to Seattle. But it does take time for people -- for companies once they make the expansion announcements to then build out the office space and then hiring then follows. And so there's always a lag. Operator: Our next question comes from the line of Alexander Goldfarb with Piper Sandler. Alexander Goldfarb: Angela, if I could just continue that Seattle discussion, sort of a 2-parter on Seattle. One, do you think that the East side has the potential to put up numbers like we're seeing in Northern Cal? And two, just from being out there in the market, it seems like CBD is waking up some of the office demand coming back there just because of space -- lack of space availability on the East side. So do you think we could be surprised by CBD as well as we look over the next 12 months? Angela Kleiman: Alex, it's a great question. It all hinges on demand. And the reason why it's possible for Seattle, especially in the East side to perform at a similar level as Northern California is because it does have that tailwind of jobs to come and supply is abating. Having said that, it is a market that historically produces more supply. So it does need more jobs in order for us to have meaningful pricing power, but we've seen this before. As far as CBD, that's a little -- as far as the CBD itself, that's a little trickier because CBD historically and as we look forward, does have a higher percentage of total supply for the market. And if you look at the location of the employers, large employers, it's throughout the whole Seattle Metro, not concentrated in the CBD. And so I do think that there is a recovery possible for CBD, but I'm not sure about the magnitude specific to pointing to Northern California, that level of magnitude. Alexander Goldfarb: Okay. And then, Barb, just a second question is I saw the RealPage litigation, but there was another litigation settlement as well. What was that? Was that also related to RealPage, or what was that? Angela Kleiman: Alex, it's Angela here. I'll cover the litigation. So we settled a separate dispute item, which has nothing to do with RealPage. And this was a litigation that was ongoing for multiple years, almost four years. And I know this magnitude is actually unusual for Essex. But after protracted litigation and considering the cost to defend, we decided it was in our best interest to just bring the matter to a resolution. But because the settlement is still subject to court approval, we've been advised to refrain from discussing additional details. But I can tell you that we don't have anything else of this magnitude. Operator: Our next question comes from the line of Jana Galan with Bank of America. Jana Galan: Congratulations on a great quarter. Following up on your comments that Northern California rents have not yet peaked this leasing season. I just wanted to confirm, is that also the case for Seattle and Southern California markets? Angela Kleiman: Good question. No, that is not the case for Seattle and Southern California. Seattle peaked consistent with typical seasonality, so in the early July. And so -- and we are expecting and seeing a moderation for the rest of the year. As far as the Southern California, it's a little bit hard to describe the peak itself. I mean, technically, it peaked early, but it's a very flat curve. So it's not really much of a peak. And I'll point to my earlier comment on the soft economy and the muted job growth as one of the key driver. And so Southern California is just kind of moving along and not doing much of anything this year. Jana Galan: And then maybe just looking at the supply outlook for 2027, it seems very favorable, especially in some of the little bit slower markets like Seattle. Just curious if there's any early comments you'd like to make on kind of the supply you see, how competitive it is to where you guys are located. Barb Pak: Yes, Jana, this is Barb. Yes, the supply is going to continue to trend lower in '27 versus '26. And the backdrop is already very favorable, and it's going to get more favorable. And we're not surprised by this given what we've seen on the ground and permits and things like that for the last several years. So this is -- it's good for us. We won't need a lot of incremental job growth next year just to cover the supply. In terms of where the supply is, it is within our metros. It doesn't necessarily have to be next to our properties, but it is competitive within our submarkets that we operate in. So overall, though, I think the supply picture continues to look good for the West Coast in our markets for the foreseeable future. Operator: Our next question comes from the line of Nick Yulico with Scotiabank. Nicholas Yulico: I wanted to see in terms of the guidance for the year on same-store revenue growth, could you get a feel for what's assumed for the different regions? In particular, I'm just wondering like for Northern California, I think you're up about 4% year-over-year in the first half of the year. Is that like a similar number for the whole year? Or does it get better in the back half of the year? Barb Pak: Nick, yes, it's Barb. I would say in terms of the various regions, Northern California, I think, continues to improve relative to where we are today through the back half of the year given the rent growth we're seeing. And that's going to be offset by slower growth in Southern California, given the moderation in blended rent growth that we're seeing there. I think Seattle stays pretty much on par. Nicholas Yulico: Okay. And then my second question is just maybe you can give us a reminder of how to think about this. I think you said Northern California blended rents were up over 6% in the quarter. We see -- look at market data, and it's all over the place, but somewhere sort of high single digit, maybe even over 10% in San Francisco specifically. So, I guess, the question is if like that type of rent growth continues in markets, how long does it take to translate into same-store revenue growth going from 4% to some higher number, 6% or more, which is where the market rent growth has been recently? Angela Kleiman: Yes. That's a good question. Our lease turns pretty quickly. And so it doesn't take a long time for rent growth to translate into the bottom line. That's one benefit of the multifamily business. But in terms of -- if your question is how long is this tailwind, is that what you're asking? Or you're only asking about the timing of the rent? Nicholas Yulico: Well, I think my question is like we're seeing rent growth that's very high coming out of Northern California, but it hasn't fully translated into your same-store revenue growth yet. So at some point, you should be accruing that benefit. But just for everyone to kind of manage expectations, how we should think about that? Angela Kleiman: Yes. Yes, I see what you're saying. We do have -- if you look at the turnover rate, that's probably a great indication of how quickly we can capture the market rent growth and turnover or retention rate is still very high with Northern Cal in particular. And that's not a surprise, right, because as markets move quickly and keep in mind, in California, we have AB 1482. So it does prolong that recovery. But to us, that's not problematic. Operator: Our next question comes from the line of Adam Kramer with Morgan Stanley. Adam Kramer: I think that at NAREIT, if I remember correctly, you guys used the word sort of stabilization or stability in SoCal. Obviously, it's a different market versus NorCal versus Seattle, different employers, et cetera. But just wondering if you could maybe give us an update sort of what's the latest thinking there? Would you sort of still use that word stabilization or a different way to maybe frame what's happening fundamentals-wise there and sort of where that market is in terms of the recovery? Angela Kleiman: Yes. We would still frame it as a stable market. I mean if you look at blended lease rates at 1.4% and plan and occupancy for that region is above 95%. This is by no means a market that's fragile or broken. It's performing as you would expect in an environment of an overall slow economic environment. Adam Kramer: Okay. That's helpful. And then just maybe flipping to Seattle. I think on the prior call, you talked about sort of positive lease growth in March and that continuing into April. Maybe just sort of how Seattle trended in terms of either new or blended through the second quarter. And I think supply there is supposed to decline pretty meaningfully over the course of this year and into next. So maybe just sort of the outlook for Seattle specifically. Angela Kleiman: Yes. I'm happy to go into a little more detail on that. And so we had talked about blended rates flipped positive in March, and it continued to increase through June, actually. And then, of course, with the peak now, it's starting to taper down. So just to give you a high level, March blended lease rate for Seattle that month was 1.4% and in June it was 2.8%. So over 140 basis points in increase. And of course, now it's starting to moderate as we would expect. Does that help give you the color you're looking for? Adam Kramer: Yes. That's helpful. Operator: Our next question comes from the line of Jamie Feldman with Wells Fargo. James Feldman: I was hoping to get a little bit more granular on the Southern California submarkets. I mean there's been so much capital raised, especially -- and then you listen to some of the industrial calls, and they're definitely getting more enthusiastic about some of the demand drivers, especially aerospace, defense. I mean can you give a little bit more color on -- maybe a better way to ask it, like are you seeing green shoots at all in any of the submarkets? Or how -- can you give us more color on what you are seeing as we think ahead? Angela Kleiman: Jamie, sure thing. Happy to. And we talked about Southern California being generally stable market. And so definitely seeing that continue. Orange County is leading the pack and San Diego is starting to turn for the better once it started to work through the bulk of the supply. So that's all a good sign. What's really dragging our Southern California continues to be L.A. County. And once again, I had talked about L.A. hitting its trough back in 2023 when occupancy was only at -- or economic occupancy was only at 91%. So since then, it's improved and it's hovering around that kind of between that 93% to 94% economic occupancy, that is. And so it's remained steady. We are seeing green shoots, like you said, from Anduril and some of these aerospace defense, but they're relatively new. And so it is a positive sign for us, but it's too new to be able to point to what the magnitude will be. James Feldman: Okay. And I guess, similarly, with all the capital being raised in Northern California, are you seeing people more interested in moving out to buy homes now that they have more capital? It certainly seems like it's helping you push rents. I'm just curious any just kind of consumer behavior you're seeing that's unique given how much those stocks have moved and how much money has been raised and wealth has been created. Angela Kleiman: Yes. Yes. No, that's a really good point. A couple of things. I think affordability remains much more attractive to rent even though we've been able to increase rents, but it's really a recovery increase, right? So the way to think about Northern California is this is a market, if you look at since pre-COVID, should be well above 20% rent growth, but we're nowhere near that. And so it still has quite a bit of catching up to do. More importantly, when we're talking about buying or converting from being a renter to a homeowner, the cost to own is exponentially more expensive. And so it's not -- it's very difficult to be -- to move from being a renter to a buyer. And we've not seen that as a reason for move-out in our portfolio. Operator: Our next question comes from the line of Austin Wurschmidt with KeyBanc Capital Markets. Austin Wurschmidt: Just wanted to go back to guidance a little bit. Given the 2.4% back half assumed lease rate growth versus, call it, 2% or even slightly below 2% that you had last year, is it fair to say we should start to see that scheduled rent accelerate in the back half of the year and that the earn-in for 2027 should be higher than the 85 basis points that you had heading into this year? Angela Kleiman: Well, I think that is possible, but it's way too early to predict because we will need to see the rate of deceleration. And like I said, we're not assuming a significant drop-off, but we still have a couple of more months before we can get a better -- be able to pinpoint the earn-in. I can give you a couple of building blocks on the earn-in side that -- as it relates to 2027 in that if you look at our supply, supply is getting lower, so that's good. And affordability tailwind continues. And then lastly, our preferred equity headwind is now behind us. So I do think that we have some pretty good building blocks there. But as far as the actual rate, we really do need to see how the next couple of months perform and how the rents moderate to get a better sense. Austin Wurschmidt: And then just when you roll up all the differing trends across your regions, is the portfolio operating at a loss or gain to lease today? And I guess where does that stand across each of the three regions? Angela Kleiman: Yes. So we do have a loss to lease, so that's good. It's mostly driven by Northern California, so no surprise there. And as far as Southern California, we have a gain to lease, also not surprise there since the curve was very flat and Seattle is kind of in the middle, slight gain to lease. Austin Wurschmidt: Could you give some color around the magnitude there, Angela, for each of the regions? Angela Kleiman: Yes. So, let me see. Northern California, let's see, closer to around, say, 6%. Southern California in the 2s and Seattle, 70 basis points. Operator: Our next question comes from the line of John Kim with BMO Capital Markets. John Kim: I wanted to ask about the change in pricing strategy. I think you said in the past, you were a little bit more agnostic on pushing renewals maybe as hard as your peers because you were looking to optimize occupancy and achieve better pricing on new leases. But now as you're pushing renewal rates higher, will that suppress new lease rates going forward? I'm just wondering why this changed? Angela Kleiman: John, we have not changed our operating philosophy or approach. The goal has always been to maximize revenues. We're agnostic on where we get that from, whether it's new lease or renewals or occupancy. Those are kind of the three big ones, if you will, or the three big levers. Now one of the reasons why depending on the market, we favor occupancy, well, that's for obvious reasons. And as far as favoring renewals over new lease rates, we talked about the cost of turnover. And so in an environment where unless we're able to push rents above, say, 6%, for example, we're better off focusing on renewals and keeping that new lease rates flat and not to incur turnover because that is very expensive. And so ultimately, I will take you back to our strategy, which is to maximize revenues and not to focus on any specific rental rates as a metric. John Kim: Okay. And then maybe another subtle change, maybe not, but you did make a couple of preferred investments in your West Coast -- one of your West Coast joint ventures. And in the past, you had said redemptions will be used to buy fee simple assets. So has that philosophy changed? Or is it because it's in a joint venture that you've made these reinvestments back into the preferred? Rylan Burns: John, Rylan here. Our overall philosophy as it relates to this business has not changed in recent years. I'd remind people that we've made a lot of money in this business over the past several decades. It's incredibly synergistic with our development and our investment businesses. So what we've done is just strategically resized this book of business, which has the benefit of reducing earnings volatility. And we're just going to remain highly selective. So when we see the best risk-adjusted returns, that's where we'll step in and lean in. And that's what we've seen more recently, and we've done another one earlier this year. So we're just going to remain highly opportunistic and making sure that we're putting our dollars to work where it's really creating value for our shareholders. John Kim: Okay. So there's not a stated strategy to reduce the preferred investment book? Rylan Burns: As Barb alluded to, it's down to $100 million. So we think it's in a very manageable space, and we could grow that if we see the right opportunities. Operator: Our next question comes from the line of Michael Goldsmith with UBS. Ami Probandt: This is Ami on with Michael. Given the strengthening rent growth in Northern California, are we getting close to the point where developments start to look more attractive? Or if not, what conditions need to change for development to start looking attractive again? Rylan Burns: Ami, this is Rylan again. Development economics have improved over the past year as rent growth has outpaced cost growth. Our philosophy as it relates to new developments is we just want to make sure that we're getting compensated for the risk inherent in all developments. So we have the South San Francisco deal, which is trending very favorably relative to our initial underwriting, and we're actually ahead of schedule on that project. We're working forward another project further down the Peninsula. And we continue to underwrite all land development sites. but just trying to remain disciplined to make sure that we're fully getting compensated for the risk inherent in development. But we continue to look at everything and the economics to answer your question bluntly, have improved. Ami Probandt: And for those deals, what yields would you be targeting approximately? Rylan Burns: What we said publicly is anywhere from 100 to 150 basis point spread to where we can go and buy. And so these yields, I think I've said on the seven self-fed deal, historically, we expect to stabilize closer to 6%. Operator: Our next question comes from the line of Haendel St. Juste with Mizuho Securities. Unknown Analyst: This is Mike on with Haendel at Mizuho. What has the retention rate been in your San Francisco portfolio? And are you seeing a higher retention rate given the stronger new market rent growth pricing? Angela Kleiman: Our retention rate in San Francisco has been elevated, so relative to the other regions, and it's been that way for quite some time. As far as our expectation, yes, we expect to maintain that high retention rate, especially in an environment where market rent is moving so quickly. And so that's not a surprise to us. But to us, that just means that it's a longer tailwind. Unknown Analyst: Okay. Helpful. And also, where are renewals being sent out and executed for August and September? And how much of your 3Q renewals in terms of visibility have been executed so far? Angela Kleiman: So, August, September, we're sending renewals out in the high 5s. And we expect negotiation probably around, say, 50 basis points. So we'll land in that low 5s range. How much of it is out? Well, let's see. August is done, and we're halfway through September. Operator: Our next question comes from the line of Peter Abramowitz with Deutsche Bank. Peter, your line is on mute on my end. We can't hear you. All right. It looks like we lost him. Our next question comes from the line of Ann Chan with Green Street. Ann Chan: So I believe you have three 3 properties with ground leases expiring in '27 or '28. Could you give us a sense of whether we should expect either a large step-up on ground rent at those properties in conjunction with an extension of the ground lease? Or if you sell the properties, do you expect a very high cap rate? Rylan Burns: Yes. And as you can imagine, these are ongoing negotiations that we'll have with the ground holders. In many instances, we'd love to figure out a way that we can renew, but it's going to go back to our broader philosophy, does this create value and at what rate. So still too early to say, but those conversations are ongoing. And it's a very, very small percentage of our portfolio. Ann Chan: And second question for me. On the JV disposition in San Jose, can you share the cap rate on the sale and maybe some color on the decision to sell versus consolidating the property? Rylan Burns: It's a fair question. This was a mid-4% cap rate, sub 4.5%. This is a joint venture that had debt maturing. So that caused us to evaluate the property and the valuation. Unsurprising, we saw very strong interest in the asset. And in this instance, we thought we could generate better risk-adjusted rewards by redeploying elsewhere. So we made the decision with our partner to sell this asset, and we're very pleased with the execution. Operator: Our last question comes from the line of Peter Abramowitz with Deutsche Bank. Peter Abramowitz: Yes, just one question about Seattle. One of your peers called out tech layoffs as a pretty specific driver of softer pricing for the first half of the year. I know it's not something we discussed much on the call and wasn't mentioned in the release. Just kind of curious if that's something you've noticed as well? Has it had any impact in your Seattle portfolio or Northern California? And just any color you could provide around that would be helpful. Angela Kleiman: Happy to. We -- it could be depending on the specific location of the asset relative to our peers. I don't know what they're seeing. But certainly, on our end, we're not seeing that as a primary reason. As we have noted in the past that these tech announcements, vast majority of them are not in our markets. And when we look at the top 20 tech jobs, the job openings have remained steady, actually with incremental increase throughout the year, we're pretty darn close long-term average despite the layoff headlines. So it's not something that we're seeing as a major impact. I'd probably point you back to the broader economy that probably has a larger influence over all the other markets, except for Northern California. Operator: Thank you. This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation. Goodbye. Before you buy stock in Essex Property Trust, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Essex Property Trust wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $397,405!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,344,091!* That performance is why people listen. With a track record of beating the S&P 500 by 4x, Stock Advisor offers a distinct advantage. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built for the long haul. See the 10 stocks » *Stock Advisor returns as of August 7, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Essex Property Trust (ESS) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

This article first appeared on GuruFocus. Core FFO per Share (Q2): Exceeded the midpoint of guidance by $0.10. Full Year Core FFO per Share Guidance: Raised by $0.20 at the midpoint, a 1.3% increase. Same-Property NOI Growth Guidance: Midpoint raised by 70 basis points to 2.8%. Same-Property Revenue Growth Guidance: Improved by 40 basis points, driven by higher scheduled rent, occupancy, and other income. Same-Property Operating Expense Growth Guidance: Lowered by 25 basis points, reflecting property tax savings. Third-Quarter Core FFO Guidance: $3.99 per share at the midpoint. Net Debt-to-EBITDA: 5.4 times. Liquidity: Over $1 billion of available liquidity. Blended Rent Growth (Seattle): 2.6% in Q2, a 340-basis point sequential increase from Q1. Blended Rent Growth (Northern California): 6.5%. Blended Rent Growth (Southern California): 1.4% in Q2. Warning! GuruFocus has detected 12 Warning Signs with ESS. Is ESS fairly valued? Test your thesis with our free DCF calculator. Release Date: July 30, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Essex Property Trust Inc (NYSE:ESS) reported a solid first half of 2026, with core FFO per share exceeding the midpoint of guidance by $0.10, driven by strong operational performance. The company raised its full-year 2026 core FFO per share guidance by $0.20 (1.3% increase at the midpoint) and increased same-property NOI growth guidance by 70 basis points to 2.8%. Northern California remains the strongest performing region, delivering 6.5% blended rent growth with strong occupancy, supported by limited supply and robust tech-driven demand. Seattle's operating conditions improved significantly, with blended rent growth increasing 340 basis points sequentially to 2.6% in Q2, and the East Side outperforming with 3.2% growth. The company maintains a strong balance sheet with net debt-to-EBITDA of 5.4 times, minimal debt maturities over the next 12 months, and over $1 billion of available liquidity. Transaction market for West Coast multifamily assets remains healthy, with cap rates for institutional quality assets in the mid-4% range, reinforcing the value of Essex's capital deployed in Northern California. Southern California, which represents 40% of the portfolio, is lagging with only 1.4% blended rent growth, closely tied to slower national economic and job growth trends. The company expects blended rent growth to moderate in the second half of 2026, with a forecasted 2.4% growth versus 2.6% in the first half, reflecting seasonal patterns and broader economic uncertainty. New lease spreads in Q2 were lower year-over-year, particularly in Southern California and Seattle, which offset the strength seen in Northern California. The company settled a separate litigation dispute (unrelated to RealPage) that had been ongoing for nearly four years, incurring an unusual magnitude of settlement costs. L.A. County continues to drag Southern California performance, with economic occupancy hovering around 93% to 94%, and the region's recovery is expected to be gradual. Development economics, while improved, still require a 100 to 150 basis point spread over acquisition yields to compensate for risk, limiting new development starts. Q: Could you elaborate on the July trends you're seeing, and how spreads and renewals are trending in July and August?A: Angela Kleiman (President and CEO): July blends are coming in similar to the second quarter, with fundamentals remaining sound. July is slightly better than the same period last year. Unlike last year, when there was a significant drop-off in the second half, we are not seeing that this year. We assume the first half and second half will be quite similar. Q: Given the market's strength, why aren't you assuming more momentum in the back half of the year within guidance?A: Angela Kleiman (President and CEO): It's a bit of both conservatism and reality. We are not anticipating a significant drop-off, but the broad US economy is slower this year than last year, which impacts Southern California. Job growth in the first half is lower than the same period last year. While Northern California remains strong, 40% of our footprint is in Southern California, which is tied to the broader economy. Southern California is still a solid long-term market, generating 1.4% blended rent growth with occupancy above 95%. Q: On new lease spreads, why was the new lease number so much lower than 2Q '25 given the strength in NorCal? What's driving the pricing decision?A: Angela Kleiman (President and CEO): There is significant variation across regions. Northern California is seeing very strong new lease spreads, but Southern California and Seattle (which together make up 60% of the portfolio) are not as strong. Renewals continue to be quite strong, coming in around 5%, and we expect the trend of lower new lease spreads and elevated renewals to continue. Q: Can you reconcile the $90 million in redemptions in the quarter with the balance only being down about $40 million sequentially? How should the balance evolve?A: Barbara Pak (CFO and EVP): Two of the redemptions were in the preferred equity book ($40 million), and one was a mezz investment that sits in notes and other receivables. We have one other small redemption in the third quarter, which is offset by a new investment. The book value we're accruing on is $100 million, which is a good run rate for guidance purposes. Q: What drove the increase in same-store revenue guidance, and what were the various components of the change?A: Angela Kleiman (President and CEO) and Barbara Pak (CFO and EVP): We expect full-year blended rent growth to land at 2.5%, with the first half at 2.6% and the second half at 2.4%. The 40 basis points improvement to same-store revenue growth is driven by scheduled rent and other income each contributing 15 basis points, with the other 10 basis points from higher occupancy. Q: Is it obvious that Northern California has seen stronger demand, or is it just that they absorbed supply earlier?A: Angela Kleiman (President and CEO): Northern California had lower supply to start with relative to Seattle. Demand starts with Northern California as the center of the innovation engine, and it expands out to Seattle over multiple cycles. We're already seeing expansion announcements to Seattle, but it takes time for companies to build out office space and then hire. Q: Do you think the East Side of Seattle has the potential to put up numbers like Northern Cal? Could CBD surprise us?A: Angela Kleiman (President and CEO): It all hinges on demand. Seattle's East Side could perform at a similar level to Northern California because of the tailwind of jobs to come and abating supply. However, Seattle historically produces more supply, so it needs more jobs for meaningful pricing power. The CBD is trickier because it has a higher percentage of total supply, and large employers are throughout the whole Seattle Metro, not concentrated in the CBD. Q: Can you confirm if Northern California rents have not yet peaked this leasing season, and is that also the case for Seattle and Southern California?A: Angela Kleiman (President and CEO): Northern California has not peaked yet, which is fantastic. Seattle peaked consistent with typical seasonality in early July and is moderating. Southern California peaked early, but it's a very flat curve, so it's not really much of a peak. Southern California is just moving along due to the soft economy and muted job growth. Q: What's assumed for same-store revenue growth by region for the year? Does Northern California get better in the back half?A: Barbara Pak (CFO and EVP): Northern California should continue to improve through the back half of the year given the rent growth we're seeing. This will be offset by slower growth in Southern California given the moderation in blended rent growth. Seattle should stay pretty much on par. Q: How long does it take for high market rent growth in Northern California to translate into same-store revenue growth?A: Angela Kleiman (President and CEO): Our lease turns pretty quickly, so it doesn't take long for rent growth to translate into the bottom line. Turnover rates are still very high in Northern Cal, and retention rates are elevated. In California, AB 1482 prolongs the recovery, but that's not problematic for us. Q: Would you still use the word "stabilization" for Southern California? Are you seeing green shoots in any submarkets?A: Angela Kleiman (President and CEO): We would still frame it as a stable market with blended lease rates at 1.4% and occupancy above 95%. Orange County is leading the pack, and San Diego is starting to turn for the better. L.A. County continues to drag, with economic occupancy hovering between 93% and 94%. We are seeing green shoots from aerospace and defense companies like Anduril, but it's too new to point to the magnitude. Q: With all the capital being raised in Northern California, are people more interested in moving out to buy homes?A: Angela Kleiman (President and CEO): Affordability remains much more attractive to rent. Northern California should be well above 20% rent growth since pre-COVID, but we're nowhere near that, so it still has catching up to do. The cost to own is exponentially more expensive, and we've not seen moving to homeownership as a reason For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Interested in Essex Property Trust, Inc.? Here are five stocks we like better. Essex Property Trust raised its full-year outlook after second-quarter results exceeded expectations, increasing the midpoint of Core FFO guidance by $0.20 per share and same-property NOI growth guidance by 70 basis points to 2.8%. Northern California led operating performance with 6.5% blended rent growth, while Seattle improved to 2.6%; Southern California remained stable at 1.4% amid muted job growth. The company ended the quarter with a solid balance sheet, including 5.4x net debt to EBITDA and more than $1 billion in liquidity, while improved development economics and healthy investor demand supported continued capital-recycling and investment opportunities. Blackstone’s $10 Billion Bet on Property Prices Going Up Essex Property Trust (NYSE:ESS) raised its full-year outlook after reporting second-quarter operating performance that exceeded its expectations, led by stronger apartment revenue trends and lower-than-anticipated expenses across its West Coast portfolio. President and Chief Executive Officer Angela Kleiman said the company’s first-half results reflected execution by its operating teams and durable multifamily fundamentals in the company’s markets, despite measured national economic and employment growth. She cited limited housing supply and the relative affordability of renting as support for demand. → Why SK hynix Could Be the Best AI Chip Stock to Buy Now Yield Curve Tests New Lows, Where Markets Are Seeking Safety Chief Financial Officer Barb Pak said Core funds from operations, or FFO, per share exceeded the midpoint of the company’s second-quarter guidance by $0.10. Same-property net operating income, or NOI, accounted for $0.05 of the outperformance, while non-same-property NOI contributed another $0.03. The same-property result included revenue growth that was 20 basis points ahead of plan and lower operating expenses. Pak said successful Proposition 8 property-tax appeals provided $0.03 of favorable property-tax results, though she characterized that benefit as one-time in nature. Northern California acquisitions made in the prior year also outperformed the company’s plan as rent growth in the region remained strong. → Microsoft Just Flipped the AI Spending Narrative Overnight Realty Income Trades At Decade Low Valuations, Worth The Yield? Essex increased the midpoint of its full-year Core FFO-per-share guidance by $0.20, or 1.3%, with better operating performance serving as the primary driver. The company raised the midpoint of its same-property NOI growth outlook by 70 basis points to 2.8%. Pak said the revised same-property revenue outlook includes a 40-basis-point improvement, driven by higher scheduled rent, occupancy and other income. Scheduled rent and other income each represented 15 basis points of the improvement, while higher occupancy represented the remaining 10 basis points. Essex also lowered the midpoint of its operating-expense growth forecast by 25 basis points, primarily due to the property-tax savings. → Carrier Earnings Could Send the Stock to a New All-Time High Higher same-property growth contributed $0.12 to the increase in full-year FFO guidance, according to Pak. The remainder primarily reflected stronger-than-expected results from the non-same-property portfolio. For the third quarter, Essex forecast Core FFO of $3.99 per share at the midpoint, a sequential decline of $0.09 from the second quarter. Pak attributed the expected decline to seasonal utility costs, California property taxes and higher controllable spending in the second half. She said controllable expenses were lower than expected in the first quarter because of timing and are expected to be $0.09 higher in the second half than in the first half. Northern California remained Essex’s strongest region in the second quarter, with blended rent growth of 6.5% and strong occupancy. Kleiman said limited housing deliveries, technology-sector investment and positive migration trends among talent and entrepreneurs supported the market. “We are experiencing growing momentum of demand for housing throughout the broader region,” Kleiman said, adding that peak leasing momentum has extended beyond typical seasonal patterns. Essex expects full-year blended rent growth of about 2.5%, with the first half coming in at approximately 2.6% and the second half implied at about 2.4%. Kleiman said Northern California’s momentum remains strong and the region had not yet reached its seasonal rent peak during the call. However, she said the company’s portfolio-wide outlook incorporates slower economic and job-growth conditions, particularly because Southern California and Seattle account for 60% of Essex’s portfolio. Northern California is expected to improve through the second half, while Southern California is expected to slow and Seattle is expected to remain roughly steady, Pak said. Essex reported a loss to lease of roughly 6% in Northern California, while Southern California had a gain to lease in the low 2% range and Seattle had a slight gain to lease of about 70 basis points. Kleiman said Northern California’s elevated retention rates may extend the time needed for market rent gains to flow through revenue, particularly because California’s AB 1482 regulations can prolong the recovery process. Seattle posted 2.6% blended rent growth in the second quarter, a 340-basis-point sequential improvement from the first quarter. The East Side outperformed, generating 3.2% blended rent growth compared with 1% in the urban core. Kleiman said Seattle rents peaked in early July, consistent with normal seasonal patterns, and are expected to moderate through the rest of the year. Blended rent growth in Seattle rose from 1.4% in March to 2.8% in June before beginning to taper, she said. The company cited recent office-expansion announcements by technology companies as a positive long-term signal for Seattle demand, though Kleiman noted that office buildouts and hiring typically follow such announcements with a lag. She said the East Side could potentially approach Northern California-like performance if job growth materializes and supply continues to abate, but the market historically produces more new supply and requires greater employment growth to generate substantial pricing power. Southern California produced 1.4% blended rent growth in the second quarter, led by Orange County, while Los Angeles lagged. Essex described the regional market as stable, with occupancy above 95%, but said muted job growth has constrained momentum. Orange County is leading the Southern California portfolio, while San Diego has begun to improve after working through a large share of new supply, Kleiman said. Los Angeles County remains the principal drag, although its economic occupancy has improved from a 91% trough in 2023 to roughly 93% to 94%. The company is seeing early signs of demand from aerospace and defense companies, including Anduril, but Kleiman said it is too early to assess the magnitude of any effect. Essex ended the period with net debt to EBITDA of 5.4 times, minimal debt maturities over the next 12 months and more than $1 billion of available liquidity, Pak said. She said the company has access to multiple capital sources and flexibility to fund commitments and pursue growth opportunities. Investor interest in West Coast multifamily properties has remained healthy despite higher interest rates, according to Kleiman. She said institutional-quality assets have generally traded at capitalization rates in the mid-4% range, while many Northern California transactions have been priced in the low-4% range. Rylan Burns, Essex’s chief investment officer and executive vice president, said the company and a joint-venture partner sold a San Jose property at a cap rate in the mid-4% range, below 4.5%. Debt maturity at the joint venture prompted the review, and Burns said Essex concluded it could achieve better risk-adjusted returns by redeploying capital elsewhere. Burns also said development economics have improved during the past year as rent growth has exceeded construction-cost growth. Essex’s South San Francisco project is ahead of its initial underwriting and ahead of schedule, he said. The company is evaluating another project farther down the peninsula and continues to seek development yields roughly 100 to 150 basis points above acquisition yields, with South Linden expected to stabilize at a yield closer to 6%. Essex Property Trust, Inc (NYSE: ESS) is a publicly traded real estate investment trust that acquires, develops, owns and operates multifamily residential properties. The company focuses on market-rate apartment communities and delivers a full suite of property services including leasing, resident services, asset management, and capital improvement programs designed to preserve and enhance long‑term property values. Essex concentrates its portfolio in West Coast markets, with a significant presence in California and the Pacific Northwest. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Essex Property Trust Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for July 2026.

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Performance outperformance was primarily driven by Northern California, which management identified as the strongest multifamily market in the country due to a compelling supply-demand imbalance and innovation-led demand. Seattle showed significant sequential improvement in blended rent growth, benefiting from a portfolio allocation toward the East Side where growth tripled the rate of the urban core. Southern California remains the portfolio's laggard, closely tethered to the broader U.S. economy's tempered employment growth and macroeconomic uncertainty. Management attributes the durability of West Coast fundamentals to limited housing supply and a significant affordability gap that continues to favor renting over homeownership. The transaction market is showing increased volume with cap rates for institutional assets remaining in the mid-4% range, validating the company's recent capital deployment in Northern California. Operational outperformance in the second quarter was bolstered by successful property tax appeals and higher-than-expected scheduled rent and occupancy levels. Full-year guidance assumes a 2.5% blended rent growth midpoint, implying a slight moderation in the second half to 2.4% as seasonal peaks pass. Management expects Northern California's momentum to extend beyond typical seasonal patterns, while Southern California is projected to remain stable but flat due to muted job growth. The 2027 outlook is supported by a favorable supply picture, with new apartment deliveries expected to trend lower in 2027 compared to 2026 across most core markets. Third-quarter core FFO guidance reflects a sequential decline due to the timing of controllable spending and normal seasonal increases in utilities and property taxes. Strategic focus remains on maximizing NAV and FFO per share through disciplined capital allocation across acquisitions, dispositions, and selective development. A one-time $0.03 benefit to property taxes was realized in the second quarter following successful Prop 8 appeals, which is not expected to recur. Management settled a multi-year litigation matter unrelated to RealPage to avoid further defense costs, though specific details remain restricted pending court approval. The preferred equity investment book has been strategically resized to approximately $100 million to reduce earnings volatility while maintaining opportunistic flexibility. California's AB 1482 regulatory environment continues to impact the pace at which market rent growth translates into bottom-line revenue by prolonging the recovery cycle. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management clarified that while Northern California has not yet peaked, the 40% portfolio exposure to a slower Southern California economy necessitates a cautious outlook. The base case assumes the first and second halves of the year will be similar, avoiding the significant drop-off experienced in late 2023. Management denied a change in philosophy, stating they remain agnostic on the source of revenue and are currently prioritizing renewals to avoid expensive turnover costs. In the current environment, focusing on renewals in the 5% range is more efficient than pushing new lease rates that may not exceed 6%. Development economics have improved as rent growth outpaces cost growth, with management targeting a 100 to 150 basis point spread over acquisition cap rates. The South San Francisco project is currently trending ahead of schedule and performing favorably relative to initial underwriting. Management stated they are not seeing tech layoffs as a primary driver of soft pricing, noting that most announced layoffs are not in their specific submarkets. Job openings in the top 20 tech categories have remained steady and near long-term averages despite headline-grabbing layoff announcements.

SAN MATEO, Calif., July 29, 2026--(BUSINESS WIRE)--Essex Property Trust, Inc. (NYSE: ESS) (the "Company") announced today its second quarter 2026 earnings results and related business activities. Net Income, Funds from Operations ("FFO"), and Core FFO per diluted share for the three and six-month periods ended June 30, 2026 are detailed below. Second Quarter 2026 Highlights: Reported Net Income per diluted share for the second quarter of 2026 of $0.97, compared to $3.44 in the second quarter of 2025. The decrease is primarily attributable to a gain on sale of real estate and land recognized in the second quarter of 2025. Grew Core FFO per diluted share by 1.2% compared to the second quarter of 2025, exceeding the midpoint of the Company’s guidance range by $0.10 per diluted share. The outperformance was primarily attributable to higher same-property and non-same-property net operating income ("NOI"). Achieved same-property revenue and NOI growth of 2.7% and 2.6%, respectively, compared to the second quarter of 2025. On a sequential basis, same-property revenue and NOI improved 0.8% and 1.2%, respectively. Disposed of a co-investment apartment community at a total contract price of $105.3 million ($52.6 million at pro rata share). Received $87.8 million from the full redemption of three structured finance investments. Revised full-year 2026 guidance range as detailed in the table below: Same-Property Operations Same-property operating results exclude any properties that are not comparable for the periods presented. The table below illustrates the percentage change in same-property revenue on a year-over-year basis for the three and six-month periods ended June 30, 2026 and on a sequential basis for the three-month period ended June 30, 2026: The table below illustrates the components that drove the change in same-property revenue on a year-over-year basis for the three and six-month periods ended June 30, 2026 and on a sequential basis for the three-month period ended June 30, 2026: Investment Activity Dispositions In June 2026, Wesco V, LLC ("Wesco V"), a joint venture in which the Company owns a 50% interest, sold a 218-unit apartment home community located in San Jose, CA for a total contract price of $105.3 million ($52.6 million at pro rata share). The Company recorded a gain on sale of co-investment communities of $9.2 million at pro rata share in the second quarter, which has been excluded from Total and Core FFO. Other Investments In the second quarter of 2026, the Company received cash proceeds of $87.8 million from the full redemption of three structured finance investments yielding a weighted average return of 11.6%. The Company recorded $0.2 million of income from prepayment penalties as the result of an early redemption, which has been excluded from Core FFO. Subsequent to quarter end, Wesco VII, LLC ("Wesco VII"), a joint venture in which the Company owns a 50% interest, originated two preferred equity investments in stabilized apartment communities totaling $36.2 million ($18.1 million at pro rata share). Both investments were fully funded at closing and yield an initial preferred return of 11.5%. Balance Sheet and Liquidity Common Stock and Liquidity In the second quarter of 2026, the Company repurchased 48,261 shares of its common stock through the Company’s stock repurchase plan, totaling $11.7 million, including commissions, at an average price per share of $242.47. Year-to-date, the Company has repurchased 254,001 shares of its common stock totaling $61.9 million, including commissions, at an average price per share of $243.76. In May 2026, the Board of Directors approved the replacement of the Company’s prior repurchase program with a new, $500.0 million stock repurchase plan. As of June 30, 2026, the Company had $500.0 million of purchase authority remaining under its stock repurchase plan. As of June 30, 2026, the Company had approximately $1.4 billion in liquidity via available capacity on its unsecured credit facilities, cash and cash equivalents, and marketable securities. Guidance For the second quarter of 2026, the Company exceeded the midpoint of the guidance range provided in its first quarter 2026 earnings release for Core FFO by $0.10 per diluted share. The following table provides a reconciliation of second quarter 2026 Core FFO per diluted share to the midpoint of the guidance provided in the Company’s first quarter 2026 earnings release. For additional details regarding the Company’s 2026 FFO guidance range, see page S-15 and S-16.1 of the supplemental financial information. Conference Call with Management The Company will host an earnings conference call with management to discuss its quarterly results on Thursday, July 30, 2026 at 11 a.m. PST (2 p.m. EST), which will be broadcast live via the Internet at www.essex.com, and accessible via phone by dialing toll-free, (877) 407-0784, or toll/international, (201) 689-8560. No passcode is necessary. A rebroadcast of the live call will be available online for 30 days and digitally for 7 days. To access the replay online, go to www.essex.com and select the second quarter 2026 earnings link. To access the replay, dial (844) 512-2921 using the replay pin number 13761419. If you are unable to access the information via the Company’s website, please contact the Investor Relations Department at [email protected] or calling (650) 655-7800. Corporate Profile Essex Property Trust, Inc., an S&P 500 company, is a fully integrated real estate investment trust (REIT) that acquires, develops, redevelops, and manages multifamily residential properties in selected West Coast markets. Essex currently has ownership interests in 258 apartment communities comprising over 62,000 apartment homes with an additional property in active development. Additional information about the Company can be found on the Company’s website at www.essex.com. This press release and accompanying supplemental financial information has been furnished to the Securities and Exchange Commission electronically on Form 8-K and can be accessed from the Company’s website at www.essex.com. If you are unable to obtain the information via the Web, please contact the Investor Relations Department at (650) 655-7800. FFO Reconciliation FFO, as defined by the National Association of Real Estate Investment Trusts ("Nareit"), is generally considered by industry analysts as an appropriate measure of performance of an equity REIT. Generally, FFO adjusts the net income of equity REITs for non-cash charges such as depreciation and amortization of rental properties, impairment charges, gains on sales of real estate and extraordinary items. Management considers FFO and FFO which excludes non-core items, which is referred to as "Core FFO," to be useful supplemental operating performance measures of an equity REIT because, together with net income and cash flows, FFO and Core FFO provide investors with additional bases to evaluate the operating performance and ability of a REIT to incur and service debt and to fund acquisitions and other capital expenditures and to pay dividends. By excluding gains or losses related to sales of depreciated operating properties and land and excluding real estate depreciation (which can vary among owners of identical assets in similar condition based on historical cost accounting and useful life estimates), FFO can help investors compare the operating performance of a real estate company between periods or as compared to different companies. By further adjusting for items that are not considered part of the Company’s core business operations, Core FFO allows investors to compare the core operating performance of the Company to its performance in prior reporting periods and to the operating performance of other real estate companies without the effect of items that by their nature are not comparable from period to period and tend to obscure the Company’s actual operating results. FFO and Core FFO do not represent net income or cash flows from operations as defined by U.S. generally accepted accounting principles ("GAAP") and are not intended to indicate whether cash flows will be sufficient to fund cash needs. These measures should not be considered as alternatives to net income as an indicator of the REIT’s operating performance or to cash flows as a measure of liquidity. FFO and Core FFO do not measure whether cash flow is sufficient to fund all cash needs including principal amortization, capital improvements and distributions to stockholders. FFO and Core FFO also do not represent cash flows generated from operating, investing or financing activities as defined under GAAP. Management has consistently applied the Nareit definition of FFO to all periods presented. However, there is judgment involved and other REITs’ calculation of FFO may vary from the Nareit definition for this measure, and thus their disclosures of FFO may not be comparable to the Company’s calculation. The following table sets forth the Company’s calculation of FFO and Core FFO per diluted share for the three and six-month periods ended June 30, 2026 and 2025 (dollars in thousands, except for share and per share amounts): Net Operating Income ("NOI") and Same-Property NOI Reconciliations NOI and Same-Property NOI are considered by management to be important supplemental performance measures to earnings from operations included in the Company’s consolidated statements of income. The presentation of same-property NOI assists with the presentation of the Company’s operations prior to the allocation of depreciation and any corporate-level or financing-related costs. NOI reflects the operating performance of a community and allows for an easy comparison of the operating performance of individual communities or groups of communities. In addition, because prospective buyers of real estate have different financing and overhead structures, with varying marginal impacts to overhead by acquiring real estate, NOI is considered by many in the real estate industry to be a useful measure for determining the value of a real estate asset or group of assets. The Company defines same-property NOI as same-property revenues less same-property operating expenses, including property taxes. Please see the reconciliation of earnings from operations to NOI and same-property NOI, which in the table below is the NOI for stabilized properties consolidated by the Company for the periods presented (dollars in thousands): Safe Harbor Statement Under The Private Litigation Reform Act of 1995: This press release includes "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. Forward-looking statements are statements which are not historical facts, including statements regarding the Company’s expectations, estimates, assumptions, hopes, intentions, beliefs and strategies regarding the future. Words such as "expects," "assumes," "anticipates," "may," "will," "intends," "plans," "projects," "believes," "seeks," "future," "estimates," and variations of such words and similar expressions are intended to identify such forward-looking statements. Such forward-looking statements include, among other things, statements regarding the Company’s third quarter and full-year 2026 guidance (including net income, Total FFO and Core FFO, same-property growth and related assumptions) and anticipated yield on certain investments. While the Company’s management believes the assumptions underlying its forward-looking statements are reasonable, such forward-looking statements involve known and unknown risks, uncertainties and other factors, many of which are beyond the Company’s control, which could cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The Company cannot assure the future results or outcome of the matters described in these statements; rather, these statements merely reflect the Company’s current expectations of the approximate outcomes of the matters discussed. Factors that might cause the Company’s actual results, performance or achievements to differ materially from those expressed or implied by these forward-looking statements include, but are not limited to, the following: assumptions related to our third quarter and full-year 2026 guidance; occupancy rates and rental demand may be adversely affected by competition and local economic and market conditions; there may be increased interest rates, inflation, escalated operating costs and possible recessionary impacts; tariffs, geopolitical tensions and regional conflicts, and the related impacts on macroeconomic conditions, including, among other things, interest rates and inflation; the terms of any refinancing may not be as favorable as the terms of existing indebtedness; the Company’s inability to maintain its investment grade credit rating with the rating agencies; the Company may be unsuccessful in the management of its relationships with its co-investment partners; the Company may fail to achieve its business objectives; time of actual completion and/or stabilization of development and redevelopment projects; estimates of future income from an acquired property may prove to be inaccurate; future cash flows may be inadequate to meet operating requirements and/or may be insufficient to provide for dividend payments in accordance with REIT requirements; changes in laws or regulations and the anticipated or actual impact of future changes in laws or regulations; unexpected difficulties in leasing of future development projects; volatility in financial and securities markets; the Company’s failure to successfully operate acquired properties; unforeseen consequences from cyber-intrusion; government approvals, actions and initiatives, including the need for compliance with environmental requirements; and those further risks, special considerations, and other factors referred to in the Company’s annual report on Form 10-K for the year ended December 31, 2025, quarterly reports on Form 10-Q, and those risk factors and special considerations set forth in the Company’s other filings with the SEC which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. All forward-looking statements are made as of the date hereof, the Company assumes no obligation to update or supplement this information for any reason, and therefore, they may not represent the Company’s estimates and assumptions after the date of this press release. Definitions and Reconciliations Non-GAAP financial measures and certain other capitalized terms, as used in this earnings release and supplemental financial information, are defined and further explained on pages S-17.1 through S-17.4, "Reconciliations of Non-GAAP Financial Measures and Other Terms," of the accompanying supplemental financial information. The supplemental financial information is available on the Company’s website at www.essex.com. View source version on businesswire.com: https://www.businesswire.com/news/home/20260729202303/en/ Contacts Contact Information Loren RaineySr. Director, Investor Relations(650) [email protected]

Essex Property Trust (ESS) reported $489.05 million in revenue for the quarter ended June 2026, representing a year-over-year increase of 4.1%. EPS of $4.08 for the same period compares to $3.44 a year ago. The reported revenue represents a surprise of +0.36% over the Zacks Consensus Estimate of $487.32 million. With the consensus EPS estimate being $4.03, the EPS surprise was +1.24%. While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expectations to determine their next move, some key metrics always offer a more accurate picture of a company's financial health. As these metrics influence top- and bottom-line performance, comparing them to the year-ago numbers and what analysts estimated helps investors project a stock's price performance more accurately. Here is how Essex Property Trust performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts: Financial Occupancies - Same-Property Portfolio: 96.3% compared to the 96.2% average estimate based on three analysts. Revenues- Rental and other property: $486.73 million versus $484.55 million estimated by five analysts on average. Compared to the year-ago quarter, this number represents a +4.1% change. Revenues- Management and other fees from affiliates: $2.32 million versus the five-analyst average estimate of $2.27 million. The reported number represents a year-over-year change of +4.3%. Revenues- Total rental and other property revenues- Same-Property Revenues: $446.04 million versus $445.99 million estimated by three analysts on average. Compared to the year-ago quarter, this number represents a +8.5% change. Revenues- Rental and other property- Other property: $7.31 million versus $6.66 million estimated by two analysts on average. Compared to the year-ago quarter, this number represents a +5.6% change. Revenues- Rental and other property- Rental income: $479.42 million versus the two-analyst average estimate of $478.01 million. The reported number represents a year-over-year change of +4.1%. Net Earnings Per Share (Diluted): $0.97 versus the four-analyst average estimate of $1.40. View all Key Company Metrics for Essex Property Trust here>>> Shares of Essex Property Trust have returned +1% over the past month versus the Zacks S&P 500 composite's +1.9% change. The stock currently has a Zacks Rank #3 (Hold), indicating that it could perform in line with the broader market in the near term. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Essex Property Trust, Inc. (ESS) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Essex Property Trust, Inc. ESS is scheduled to report its second-quarter 2026 results on July 29, after market close. The company’s quarterly results are likely to reflect year-over-year growth in revenues, while core funds from operations (FFO) per share might remain unchanged. In the last reported quarter, this San Mateo, CA-based residential real estate investment trust (REIT) delivered a surprise of 2.53% in terms of core FFO per share. Results reflected favorable growth in same-property net operating income (NOI) aided by solid property-level momentum. Over the trailing four quarters, Essex Property’s earnings surpassed the Zacks Consensus Estimate on three occasions and missed on the other, the average surprise being 0.82%. The graph below depicts the surprise history of the company: Essex Property Trust, Inc. price-eps-surprise | Essex Property Trust, Inc. Quote Let’s see how things have shaped up before this announcement. The U.S. multifamily market entered the second half of 2026 with a clearer recovery taking shape, as strong renter demand and a rapidly shrinking supply pipeline began translating into lower vacancy and improving rent growth. According to a Cushman & Wakefield report, net absorption reached roughly 124,600 units, up from 83,500 units in the first quarter and 8% above the prior year, making it the fifth-strongest quarter in nearly 25 years. The supply picture also became more favorable. Approximately 88,000 units were delivered during the quarter, down 27% year over year. Around 475,000 units remained under construction at quarter-end, equal to just 3.5% of existing inventory. Improving demand and slowing supply pushed the national vacancy rate down 35 basis points quarter over quarter to 8.9%, its first move below 9% since 2024. On a trailing four-quarter basis, absorption of approximately 362,000 units exceeded deliveries of about 358,000 units for the first time since early 2022, indicating vacancy is likely to have passed its cyclical peak. The recovery was particularly pronounced in previously overbuilt markets: Austin; Charleston, SC; Savannah, GA; Huntsville, AL; Salt Lake City, UT, and Colorado Springs recorded some of the largest quarterly vacancy declines. Rent growth remains modest but is beginning to improve. National asking rents reached approximately $1,945 per month, up 1.5% year over year, compared with 1.1% growth in the first quarter. The Bay Area led the recovery, with San Francisco rents rising 13%, San Jose 7% and the East Bay 4.8%. Norfolk, VA; Toledo; Reno, NV, and Boise, ID, also posted strong gains. High-supply markets remained softer, with rents still declining in Austin and Sarasota, FL, although the pace of those declines moderated as excess supply was absorbed. Overall, the market appears to be shifting from stabilization into an occupancy-led recovery, with broader rent growth likely as the construction pipeline continues to shrink. Essex’s Q2 2026 results are likely to benefit from peak-season leasing, high occupancy and limited new supply. The company entered the quarter with April occupancy at 96.4% and blended lease growth above 3%. Northern California should remain the main growth driver, supported by tech activity, AI expansion and improving migration. Seattle also showed better momentum as lease rates turned positive in March and April. Southern California is likely to remain mixed. Overall, the second quarter should show improving rent growth and stable occupancy, partly offset by higher expenses from delayed projects. The Zacks Consensus Estimate of $486.85 million for second-quarter revenues calls for a 3.62% increase year over year. The consensus estimate for same-property revenues is pegged at $445.99 million, up from $410.95 million in the year-ago period. The consensus mark for same-property financial occupancies is currently pegged at 96.20%, on par with the prior quarter. For second-quarter 2026, Essex Property projected core FFO per share in the range of $3.92-$4.04 per share, with a midpoint of $3.98. Before the second-quarter earnings release, Essex Property’s activities were inadequate to gain analysts’ confidence. The Zacks Consensus Estimate for the quarterly core FFO per share was revised southward in the past week to $4.03. It indicates no change year over year. Our proven model predicts a surprise in terms of core FFO per share for Essex Property this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an FFO beat, which is the case here. Essex Property currently carries a Zacks Rank of 3 and has an Earnings ESP of +0.54%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter. Here are two other stocks from the broader REIT sector — Digital Realty Trust DLR and Cousins Properties CUZ— you may want to consider, as our model shows that these also have the right combination of elements to report an FFO beat this quarter. Digital Realty is slated to report quarterly numbers on July 23. DLR has an Earnings ESP of +2.30% and a Zacks Rank of 3 at present. You can see the complete list of today’s Zacks #1 Rank stocks here. Cousins is slated to report quarterly numbers on July 30. CUZ has an Earnings ESP of +0.45% and a Zacks Rank of 3 at present. Note: Anything related to earnings presented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Essex Property Trust, Inc. (ESS) : Free Stock Analysis Report Cousins Properties Incorporated (CUZ) : Free Stock Analysis Report Digital Realty Trust, Inc. (DLR) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Equity Residential EQR reported second-quarter 2026 normalized funds from operations of $1.02 per share, which beat the Zacks Consensus Estimate of $1.01 and rose 3% year over year. Rental income increased 2.1% to $785.05 million but missed the Zacks Consensus Estimate marginally. Results reflected higher same-store net operating income (NOI) supported by strong physical occupancy and better-than-anticipated renewal rates achieved. The company raised the midpoint of 2026 same-store revenue and NOI guidance. Same-store residential revenues rose 2.1%, supported by firm occupancy and better-than-anticipated renewal pricing. San Francisco and New York remained the strongest markets. Total same-store revenues increased 1.9% year over year, while expenses rose 3%. Same-store NOI advanced 1.4%. Physical occupancy was 96.2% compared with 96.6% in the prior-year quarter. We estimated the same to be 96.5%. Same-store residential lease rates grew 1.8%. Higher ancillary income, utility recoveries and other items added 0.5% to revenue growth, while improved net bad debt contributed 0.2%. Vacancy reduced growth by 0.3%, and leasing concessions lowered it by 0.1%. Renewal pricing remained the primary support for rent growth. The renewal rate achieved was 5.2% in the second quarter compared with 5.1% a year earlier. New-lease rates declined 0.7%, resulting in blended rate growth of 2.8%. Preliminary July data showed further progress. Blended rate growth accelerated to 3%, as new-lease change improved to negative 0.1%. Renewal rates remained healthy at 4.9%, while physical occupancy held at 96.2%. Net effective asking rents were up roughly 7.5% from the beginning of 2026. San Francisco continued to outperform expectations. Strong demand drove a 6.5% increase in average rental rates, higher physical occupancy and very low turnover. New York also benefited from limited new supply and strong demand, producing a 4.3% increase in average rental rates. Performance was softer in Washington, D.C., where a muted labor market weighed on demand. Los Angeles and Seattle entered the primary leasing season with weaker demand, leading to greater concession use, lower occupancy and softer blended rates. Expansion markets continued to absorb elevated available inventory. During the quarter, the company sold two properties containing 515 apartment units for approximately $164 million. The properties, located in Los Angeles and San Francisco, were sold at a weighted-average disposition yield of 5.3%. EQR did not acquire any properties. The company completed a 440-unit partially owned development in suburban Boston at a total cost of approximately $232.2 million. It also completed an unconsolidated 369-unit development in suburban Seattle costing approximately $185.3 million. The portfolio ended June with 312 properties and 85,520 apartment units. EQR and AvalonBay Communities agreed to an all-stock merger of equals that would create a company with more than 180,000 apartments and an enterprise value of approximately $71 billion. The companies expect $175 million of annual gross synergies within 18 months before projected real estate tax reassessments. Management raised the midpoint of its full-year same-store revenue growth outlook by 20 basis points. The revised range is 2.1%-2.7% compared with the previous range of 1.2%-3.2%. The improvement reflects stronger San Francisco momentum and better net bad-debt trends. The company suspended its full-year EPS, FFO and core FFO outlook because of the proposed merger with AvalonBay Communities. The midpoint of the same-store NOI growth forecast increased 30 basis points. EQR now expects growth of 1.5%-2.1% versus the prior range of 0.5%-2.5%. The expense growth outlook remains 3%-4%, while expected physical occupancy was adjusted to 96.3% from 96.4%. EQR currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Equity Residential price-consensus-eps-surprise-chart | Equity Residential Quote We now look forward to the earnings releases of other residential REITs, such as Essex Property Trust ESS and Invitation Homes INVH, which are slated to report on July 29. The Zacks Consensus Estimate for Essex Property’s second-quarter 2026 FFO per share is pegged at $4.03, which implies flat growth year over year. ESS currently carries a Zacks Rank #3. The Zacks Consensus Estimate for INVH’s second-quarter 2026 FFO per share is pegged at 49 cents, which suggests a year-over-year increase of 2.1%. INVH currently carries a Zacks Rank #3. Note: Anything related to earnings presented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Equity Residential (EQR) : Free Stock Analysis Report Essex Property Trust, Inc. (ESS) : Free Stock Analysis Report Invitation Home (INVH) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research