2025
2024
$
Change
%
Change
Net income
$
1,151,949
$
1,070,975
$
80,974
7.6
%
Adjustments:
Property management
133,369
132,739
0.5
%
General and administrative
65,280
61,653
3,627
5.9
%
Depreciation
1,010,400
952,191
58,209
6.1
%
Net (gain) loss on sales of real estate properties
(626,388
)
(546,797
)
(79,591
)
14.6
%
Interest and other income
(52,440
)
(30,329
)
(22,111
)
72.9
%
Other expenses
60,485
74,051
(13,566
)
(18.3
)%
Interest:
Expense incurred, net
306,798
285,735
21,063
7.4
%
Amortization of deferred financing costs
8,768
7,834
11.9
%
Income and other tax expense (benefit)
1,585
1,256
26.2
%
(Income) loss from investments in unconsolidated entities
18,915
8,974
9,941
110.8
%
Net (gain) loss on sales of land parcels
—
100.0
%
Total NOI
$
2,078,801
$
2,018,282
$
60,519
3.0
%
Rental income:
Same store
$
2,821,804
$
2,749,354
$
72,450
2.6
%
Non-same store/other
272,155
230,754
41,401
17.9
%
Total rental income
3,093,959
2,980,108
113,851
3.8
%
Operating expenses:
Same store
904,887
872,799
32,088
3.7
%
Non-same store/other
110,271
89,027
21,244
23.9
%
Total operating expenses
1,015,158
961,826
53,332
5.5
%
NOI:
Same store
1,916,917
1,876,555
40,362
2.2
%
Non-same store/other
161,884
141,727
20,157
14.2
%
Total NOI
$
2,078,801
$
2,018,282
$
60,519
3.0
%
See Note 16 in the Notes to Consolidated Financial Statements for our disclosure of reportable segments.
The comparison discussions provided below detail the changes in results for the year ended December 31, 2025 as compared to the year ended December 31, 2024.
The increase in same store rental income is primarily driven by good demand and modest supply across most of our markets.
The increase in same store rental income is primarily driven by good demand and modest supply across most of our markets.
The increase in same store operating expenses is due primarily to:
The increase in same store operating expenses is due primarily to:
Real estate taxes – An $8.1 million increase due to escalation in rates and assessed values;
Real estate taxes – An $8.1 million increase due to escalation in rates and assessed values;
Utilities – An $11.3 million increase primarily driven by higher commodity prices, higher sewer and trash rates and higher water usage in Southern California; and
Utilities – An $11.3 million increase primarily driven by higher commodity prices, higher sewer and trash rates and higher water usage in Southern California; and
Repairs and maintenance – A $6.2 million increase primarily driven by costs associated with the implementation of various resident technology initiatives (including bulk Wi-Fi programs).
Repairs and maintenance – A $6.2 million increase primarily driven by costs associated with the implementation of various resident technology initiatives (including bulk Wi-Fi programs).
Non-same store/other NOI results consist primarily of properties acquired in calendar years 2024 and 2025, operations from the Company’s development properties, other corporate operations and operations prior to disposition from 2024 and 2025 sold properties. The increase in NOI is primarily a result of the Company's 2025 and significant second half of 2024 net acquisition activity, which is positively impacting 2025 results.
Non-same store/other NOI results consist primarily of properties acquired in calendar years 2024 and 2025, operations from the Company’s development properties, other corporate operations and operations prior to disposition from 2024 and 2025 sold properties. The increase in NOI is primarily a result of the Company's 2025 and significant second half of 2024 net acquisition activity, which is positively impacting 2025 results.
The increase in consolidated total NOI is a result of the Company’s higher NOI from non-same store properties as noted above and higher NOI from same store properties, largely due to improvement in same store revenues and the Company's continued focus
The increase in consolidated total NOI is a result of the Company’s higher NOI from non-same store properties as noted above and higher NOI from same store properties, largely due to improvement in same store revenues and the Company's continued focus on same store expense efficiency.
See the Same Store Results section below for additional discussion of those results. See the reconciliation table of net income per the consolidated statements of operations to NOI above for the dollar and percentage changes related to the comparison discussions provided below.
Property management expenses include off-site expenses associated with the self-management of the Company’s properties as well as management fees paid to any third-party management companies. The increase during the year ended December 31, 2025 as compared to 2024 is primarily attributable to increases in training and marketing expenses, information technology expenses and legal and professional fees, partially offset by decreases in workforce/contractors costs and payroll-related costs.
General and administrative expenses, which include corporate operating expenses, increased during the year ended December 31, 2025 as compared to 2024, primarily due to increases in payroll-related costs and other public company costs.
Depreciation expense increased during the year ended December 31, 2025 as compared to 2024, primarily as a result of additional depreciation expense on properties acquired in 2024 and 2025 and development properties placed in service during 2024 and 2025, partially offset by lower depreciation from properties sold in 2024 and 2025.
Net gain on sales of real estate properties increased during the year ended December 31, 2025 as compared to 2024, primarily as a result of a higher dollar sales volume and the mix of properties sold in 2025 vs. 2024.
Interest and other income increased during the year ended December 31, 2025 as compared to 2024, primarily due to a net increase in realized/unrealized gains on various investment securities, interest income on mortgages receivable and an employment tax refund received in 2025 but not in 2024, partially offset by lower insurance/litigation settlement proceeds received during 2025 as compared to 2024.
Other expenses decreased during the year ended December 31, 2025 as compared to 2024, primarily due to a decrease in advocacy contributions, partially offset by increases in litigation accruals and the write-off of development pursuit costs and overhead.
Interest expense, including amortization of deferred financing costs, increased during the year ended December 31, 2025 as compared to 2024, primarily due to higher overall debt balances outstanding and higher overall rates. The effective interest cost on all indebtedness, excluding debt extinguishment costs/prepayment penalties, for the year ended December 31, 2025 was 3.93% as compared to 3.91% in 2024. The Company capitalized interest of approximately $12.4 million and $14.5 million during the years ended December 31, 2025 and 2024, respectively.
Loss from investments in unconsolidated entities increased during the year ended December 31, 2025 as compared to 2024, primarily as a result of losses incurred on our unconsolidated development properties which recently started lease-up activities as well as those that recently stabilized and on our real estate technology and other real estate fund investments.
For comparison of the year ended December 31, 2024 to the year ended December 31, 2023, refer to Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, included in the Company’s and the Operating Partnership’s Annual Report on Form 10-K for the year ended December 31, 2024.