AVALONBAY COMMUNITIES INC

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estate investment trust (“REIT”) for federal income tax purposes. We develop, redevelop, acquire, own and operate multifamily apartment communities in New England, the New York/New Jersey metro area, the Mid-Atlantic, the Pacific Northwest, and Northern and Southern California, as well as in our expansion regions of Raleigh-Durham and Charlotte, North Carolina, Southeast Florida, Dallas and Austin, Texas, and Denver, Colorado. We focus on leading metropolitan areas that we believe are generally characterized by growing employment in high wage sectors of the economy, higher cost of home ownership and a diverse and vibrant quality of life. We believe these market characteristics have offered, and will continue to offer, the opportunity for superior risk-adjusted returns over the long-term on apartment community investments relative to other markets that do not have these characteristics.

Current wording

estate investment trust (“REIT”) for federal income tax purposes. We develop, redevelop, acquire, own and operate apartment communities in New England, the New York/New Jersey metro area, the Mid-Atlantic, the Pacific Northwest, and Northern and Southern California, as well as in our expansion regions of Raleigh-Durham and Charlotte, North Carolina, Southeast Florida, Dallas and Austin, Texas, and Denver, Colorado. We focus on leading metropolitan areas that we believe are generally characterized by growing employment in high wage sectors of the economy, higher cost of home ownership and a diverse and vibrant quality of life. We believe these market characteristics have offered, and will continue to offer, the opportunity for superior risk-adjusted returns over the long-term on apartment community investments relative to other markets that do not have these characteristics.

Previous wording

Our principal financial goal is to increase long-term shareholder value through the development, redevelopment, acquisition, ownership, operation and asset management and, when appropriate, disposition of apartment communities in our markets. To help meet this goal, we regularly (i) monitor our investment allocation by geographic market and product type, (ii) develop, redevelop and acquire apartment communities in our selected markets, (iii) efficiently operate our communities to maximize resident satisfaction and shareholder return, (iv) selectively sell apartment communities that no longer meet our long term strategy or when opportunities are presented to realize a portion of the value created through our investment and redeploy the proceeds from those sales and (v) maintain a capital structure that we believe is aligned with our business risks and allows us to maintain continuous access to cost-effective capital. We pursue our development, redevelopment, investment and operating activities with the purpose of “Creating a Better Way to Live.”

Current wording

Our principal financial goal is to increase long-term shareholder value through the development, redevelopment, acquisition, ownership, operation and asset management and, when appropriate, disposition of apartment communities in our markets. To help meet this goal, we regularly (i) monitor our investment allocation by geographic market and product type, (ii) develop, redevelop and acquire interests in apartment communities in our selected markets, (iii) efficiently operate our communities to maximize resident satisfaction and shareholder return, (iv) selectively sell apartment communities that no longer meet our long term strategy or when opportunities are presented to realize a portion of the value created through our investment and redeploy the proceeds from those sales and (v) maintain a capital structure that we believe is aligned with our business risks and allows us to maintain continuous access to cost-effective capital. We pursue our development, redevelopment, investment and operating activities with the purpose of “Creating a Better Way to Live.”

Previous wording

•Net income attributable to common stockholders for the three months ended September 30, 2024 was $372,519,000, an increase of $200,488,000, or 116.5%, from the prior year period. The increase is primarily attributable to increases in real estate sales and related gains and an increase in NOI from communities over the prior year period.

Current wording

•Net income attributable to common stockholders for the three months ended March 31, 2025 was $236,597,000, an increase of $63,148,000, or 36.4%, from the prior year period. The increase was primarily attributable to increases in real estate sales and related gains and an increase in NOI from communities over the prior year period.

Previous wording

•Same Store NOI attributable to our apartment rental operations, including parking and other ancillary residential revenue ("Residential"), for the three months ended September 30, 2024 was $456,664,000, an increase of $9,170,000, or 2.0%, over the prior year period. The increase over the prior year period was due to an increase in Residential revenue of $20,205,000, or 3.1%, partially offset by an increase in Residential property operating expenses of $11,035,000, or 5.4%.

Current wording

•Same Store NOI attributable to our apartment rental operations, including parking and other ancillary residential revenue ("Residential"), for the three months ended March 31, 2025 was $478,316,000, an increase of $12,025,000, or 2.6%, over the prior year period. The increase over the prior year period was due to an increase in Residential revenue of $20,294,000, or 3.0%, partially offset by an increase in Residential property operating expenses of $8,269,000, or 4.0%.

Previous wording

•19 wholly-owned communities under construction, which are expected to contain 6,855 apartment homes with a projected total capitalized cost of $2,683,000,000.

Current wording

•19 wholly-owned communities under construction, which are expected to contain 6,595 apartment homes with a projected total capitalized cost of $2,493,000,000.

Previous wording

•Land or rights to land on which we expect to develop an additional 28 apartment communities that, if developed as expected, will contain 9,091 apartment homes.

Current wording

•Land or rights to land on which we expect to develop an additional 28 apartment communities that, if developed as expected, will contain 8,932 apartment homes.

Previous wording

Third Quarter 2024 Real Estate Transactions Highlights

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First Quarter 2025 Real Estate Transactions Highlights

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•Same Store is composed of consolidated communities where a comparison of operating results from the prior year to the current year is meaningful as these communities were owned and had stabilized occupancy as of the beginning of the prior year period. For the nine month periods ended September 30, 2024 and 2023, Same Store communities are consolidated for financial reporting purposes, had stabilized occupancy as of January 1, 2023, are not conducting or are not probable to conduct substantial redevelopment activities and are not held for sale as of September 30, 2024 or probable for disposition to unrelated third parties within the current year. A community is considered to have stabilized occupancy at the earlier of (i) attainment of 90% physical occupancy or (ii) the one-year anniversary of completion of development or redevelopment.

Current wording

•Same Store is composed of consolidated communities where a comparison of operating results from the prior year to the current year is meaningful as these communities were owned and had stabilized occupancy as of the beginning of the prior year period. For the three month periods ended March 31, 2025 and 2024, Same Store communities are consolidated for financial reporting purposes, had stabilized occupancy as of January 1, 2024, are not conducting or are not probable to conduct substantial redevelopment activities and are not held for sale as of March 31, 2025 or probable for disposition to unrelated third parties within the current year. A community is considered to have stabilized occupancy at the earlier of (i) attainment of 90% physical occupancy or (ii) the one-year anniversary of completion of development or redevelopment.

Previous wording

•Redevelopmentis composed of consolidated communities where substantial redevelopment occurred or is in progress. Redevelopment is considered substantial when (i) capital invested is expected to exceed the lesser of $5,000,000 or 10% of the community's pre-redevelopment basis and (ii) physical occupancy is below or is expected to be below 90% during, or as a result of, the redevelopment activity.

Current wording

•Redevelopmentis composed of consolidated communities where substantial redevelopment occurred, is in progress, or is probable to begin during the fiscal year. Redevelopment is considered substantial when (i) capital invested is expected to exceed the lesser of $5,000,000 or 10% of the community's pre-redevelopment basis and (ii) physical occupancy is below or is expected to be below 90% during, or as a result of, the redevelopment activity.

Previous wording

Our results of operations are driven by our operating platform and are primarily affected by both overall and individual geographic market conditions and apartment fundamentals and is reflected in changes in Same Store NOI; NOI derived from acquisitions, development completions and development under construction and in lease-up; loss of NOI related to disposed communities; and capital market and financing activity. A comparison of our operating results for the three and nine months ended September 30, 2024 and 2023 is as follows (unaudited, dollars in thousands).

Current wording

Our results of operations are driven by our operating platform and are primarily affected by both overall and individual geographic market conditions and apartment fundamentals and are reflected in changes in Same Store NOI; NOI derived from acquisitions, development completions and development under construction and in lease-up; loss of NOI related to disposed communities; and capital market and financing activity. A comparison of our operating results for the three months ended March 31, 2025 and 2024 is as follows (unaudited, dollars in thousands).

Previous wording

Net income attributable to common stockholders increased $200,488,000, or 116.5%, to $372,519,000 and $113,046,000, or 16.5%, to $799,902,000 for the three and nine months ended September 30, 2024, respectively, as compared to the prior year periods, primarily due to increases in real estate sales and related gains, increases in income from unconsolidated investments and an increase in NOI from communities over the prior year periods.

Current wording

Net income attributable to common stockholders increased $63,148,000, or 36.4%, to $236,597,000 for the three months ended March 31, 2025, as compared to the prior year period, primarily due to increases in NOI from communities and real estate sales and related gains in the current year.

Previous wording

NOI. We define NOI as total property revenue less direct property operating expenses (including property taxes), and excluding corporate-level income (including management, development and other fees), property management and other indirect operating expenses, net of corporate income, expensed transaction, development and other pursuit costs, net of recoveries, interest expense, net, loss on extinguishment of debt, net, general and administrative expense, income from unconsolidated investments, depreciation expense, income tax (benefit) expense, casualty and impairment loss, gain on sale of communities, other real estate activity and net operating income from real estate assets sold or held for sale. Management considers NOI to be an important and appropriate supplemental performance measure to net income because it helps both investors and management to understand the core operations of a community or communities prior to the allocation of any corporate-level property management overhead or financing-related costs. NOI reflects the operating performance of a community and allows for an easier comparison of the operating performance of individual assets or groups of assets. In addition, because prospective buyers of real estate have different financing and overhead structures, with varying marginal impact to overhead as a result of 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.

Current wording

NOI. We define NOI as total property revenue less direct property operating expenses (including property taxes), and excluding corporate-level income (including management, development and other fees), property management and other indirect operating expenses, net of corporate income, expensed transaction, development and other pursuit costs, net of recoveries, interest expense, net, loss on extinguishment of debt, net, general and administrative expense, income from unconsolidated investments, Structured Investment Program interest income, depreciation expense, income tax expense (benefit), casualty and impairment loss, gain on sale of communities, other real estate activity and net operating income from real estate assets sold or held for sale. Management considers NOI to be an important and appropriate supplemental performance measure to net income because it helps both investors and management to understand the core operations of a community or communities prior to the allocation of any corporate-level property management overhead or financing-related costs. NOI reflects the operating performance of a community and allows for an easier comparison of the operating performance of individual assets or groups of assets. In addition, because prospective buyers of real estate have different financing and overhead structures, with varying marginal impact to overhead as a result of 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.

Previous wording

NOI does not represent cash generated from operating activities in accordance with GAAP, and NOI should not be considered an alternative to net income as an indication of our performance. NOI should also not be considered an alternative to net cash flow from operating activities, as determined by GAAP, as a measure of liquidity, nor is NOI indicative of cash available to fund cash needs. Residential NOI represents results attributable to our apartment rental operations, including parking and other ancillary residential revenue. Reconciliations of NOI and Residential NOI for the three and nine months ended September 30, 2024 and 2023 to net income for each period are as follows (unaudited, dollars in thousands):

Current wording

NOI does not represent cash generated from operating activities in accordance with GAAP, and NOI should not be considered an alternative to net income as an indication of our performance. NOI should also not be considered an alternative to net cash flow from operating activities, as determined by GAAP, as a measure of liquidity, nor is NOI indicative of cash available to fund cash needs. Residential NOI represents results attributable to our apartment rental operations, including parking and other ancillary residential revenue. Reconciliations of NOI and Residential NOI for the three months ended March 31, 2025 and 2024 to net income for each period are as follows (unaudited, dollars in thousands):

Previous wording

The following presents our Residential NOI and respective changes for the three and nine months ended September 30, 2024 as compared to the three and nine months ended September 30, 2023 (unaudited, dollars in thousands):

Current wording

The Residential NOI changes for the three months ended March 31, 2025 compared to the three months ended March 31, 2024 consist of changes in the following categories (unaudited, dollars in thousands):

Previous wording

The 2.0% increase in our Same Store Residential NOI for the three months ended September 30, 2024 is due to an increase in Residential revenue of $20,205,000, or 3.1%, partially offset by an increase in Residential property operating expenses of $11,035,000, or 5.4%, over the prior year period. The 2.9% increase in our Same Store Residential NOI for the nine months ended September 30, 2024 is due to an increase in Residential revenue of $67,094,000, or 3.5%, partially offset by an increase in Residential property operating expenses of $28,516,000, or 4.8%, over the prior year period.

Current wording

The 2.6% increase in our Same Store Residential NOI for the three months ended March 31, 2025 is due to an increase in Residential revenue of $20,294,000, or 3.0%, partially offset by an increase in Residential property operating expenses of $8,269,000, or 4.0%, over the prior year period.

Previous wording

Rental and other income increased $36,890,000, or 5.3%, and $110,374,000, or 5.4%, for the three and nine months ended September 30, 2024, respectively, compared to the prior year periods, primarily due to the increased rental revenue from our Same Store communities, discussed below.

Current wording

Rental and other income increased $33,074,000, or 4.7%, for the three months ended March 31, 2025, compared to the prior year period, primarily due to the increased rental revenue from our Same Store communities, discussed below.

Previous wording

Consolidated Communities — The weighted average number of occupied apartment homes for consolidated communities increased to 79,203 apartment homes for the nine months ended September 30, 2024, compared to 77,439 homes for the prior year period. The weighted average monthly revenue per occupied apartment home increased to $3,059 for the nine months ended September 30, 2024, compared to $2,945 in the prior year period.

Current wording

Consolidated Communities — The weighted average number of occupied apartment homes for consolidated communities increased to 80,703 apartment homes for the three months ended March 31, 2025, compared to 77,375 homes for the prior year period. The weighted average monthly residential revenue per occupied apartment home increased to $3,025 for the three months ended March 31, 2025, compared to $3,020 in the prior year period.

Previous wording

Same Store Communities — The following table presents the change in Same Store Residential revenue, including the attribution of the change between average revenue per occupied home and Economic Occupancy (as defined below) for the nine months ended September 30, 2024 (unaudited, dollars in thousands).

Current wording

Same Store Communities — The following table presents the change in Same Store Residential revenue, including the attribution of the change between average revenue per occupied home and Economic Occupancy (as defined below) for the three months ended March 31, 2025 (unaudited, dollars in thousands).

Previous wording

Direct property operating expenses, excluding property taxes, increased $11,446,000, or 8.2%, and $25,708,000, or 6.4%, for the three and nine months ended September 30, 2024, respectively, compared to the prior year periods, primarily due to the addition of newly developed apartment communities as well as increased Residential operating expenses at our Same Store communities as discussed below.

Current wording

Direct property operating expenses, excluding property taxes, increased $10,276,000, or 7.4%, for the three months ended March 31, 2025 compared to the prior year period, primarily due to the addition of newly developed apartment communities as well as increased Residential operating expenses at our Same Store communities as discussed below.

Previous wording

Same Store Residential direct property operating expenses, excluding property taxes, increased $8,449,000, or 6.5%, and $18,109,000, or 4.8%, for the three and nine months ended September 30, 2024, respectively, compared to the prior year periods, primarily due to increased utility costs from our bulk internet offering, trash costs and increased property insurance premiums.

Current wording

Same Store Residential direct property operating expenses, excluding property taxes, increased $7,568,000, or 5.8%, for the three months ended March 31, 2025, compared to the prior year period, primarily due to increased (i) repairs and maintenance costs, (ii) utility costs from our bulk internet offering, (iii) property insurance premiums and (iv) marketing costs from internet advertising.

Previous wording

Property taxes increased $4,020,000, or 5.1%, and $15,373,000, or 6.7%, for the three and nine months ended September 30, 2024, respectively, compared to the prior year periods, primarily due to the addition of newly developed apartment communities and increases for our Same Store Residential portfolio, partially offset by decreased property taxes from dispositions.

Current wording

Property taxes increased $2,051,000, or 2.6%, for the three months ended March 31, 2025, compared to the prior year period, primarily due to increases for our Same Store Residential portfolio and the addition of newly developed and acquired apartment communities, partially offset by decreased property taxes from dispositions.

Previous wording

Same Store Residential property taxes increased $2,586,000, or 3.5%, and $10,407,000, or 4.9%, for the three and nine months ended September 30, 2024, respectively, compared to the prior year periods, due to increased assessments and rates across the portfolio, successful appeals in the prior year period in excess of current period successful appeals and the expiration of property tax incentive programs primarily at certain of our properties in New York City. The expiration of property tax incentive programs represents $752,000, or 29%, of the 3.5% increase in property taxes for the three months ended September 30, 2024 and $4,546,000, or 44%, of the 4.9% increase in property taxes for the nine months ended September 30, 2024.

Current wording

Same Store Residential property taxes increased $701,000, or 0.9%, for the three months ended March 31, 2025, compared to the prior year period, due to increased assessments across the portfolio and the expiration of property tax incentive programs primarily at certain of our properties in New York City, partially offset by successful appeals in the current year period in excess of the prior year period.

Previous wording

Property management and other indirect operating expenses, net of corporate income increased $6,404,000, or 18.0%, and $12,974,000, or 12.3%, for the three and nine months ended September 30, 2024, respectively, compared to the prior year periods, primarily due to increased costs related to investments in technology and process related spend for initiatives to improve future efficiency in services for residents and prospects and increased advocacy costs.

Current wording

Property management and other indirect operating expenses, net of corporate income increased $838,000, or 2.3%, for the three months ended March 31, 2025, compared to the prior year period, primarily due to increased costs related to investments in technology and process related spend for initiatives to improve future efficiency in services for residents and prospects.

Previous wording

Expensed transaction, development and other pursuit costs, net of recoveries includes costs incurred for write downs and abandonment of Development Rights and development pursuits not yet considered probable for development, as well as costs related to abandoned acquisition and disposition pursuits, offset by any recoveries of costs incurred. In periods of increased acquisition and pursuit activity, periods of economic downturn or when there is limited access to capital, these costs can be volatile and may vary significantly from year to year. In addition, the timing for potential recoveries will not always align with the timing for expensing an abandoned pursuit. Expensed transaction, development and other pursuit costs, net of recoveries, was $1,573,000 and $7,235,000 for the three and nine months ended September 30, 2024, respectively, and $18,959,000 and $23,212,000 for the three and nine months ended September 30, 2023, respectively. The amounts for 2023 include write-offs of $17,111,000 related to three Development Rights in Northern and Southern California and the Mid-Atlantic that we determined are no longer probable.

Current wording

Expensed transaction, development and other pursuit costs, net of recoveries includes costs incurred for write downs and abandonment of Development Rights and development pursuits not yet considered probable for development, as well as costs related to abandoned acquisition and disposition pursuits, offset by any recoveries of costs incurred. In periods of increased acquisition and pursuit activity, periods of economic downturn or when there is limited access to capital, these costs can be volatile and may vary significantly from year to year. In addition, the timing for potential recoveries will not always align with the timing for expensing an abandoned pursuit. Expensed transaction, development and other pursuit costs, net of recoveries, was $4,744,000 for the three months ended March 31, 2025, and $4,245,000 for the three months ended March 31, 2024. The amounts for 2025 and 2024 include a write-off of $3,668,000 and $1,600,000, respectively, for one development opportunity in each year that the Company determined is no longer probable.

Previous wording

Interest expense, netincreased $7,654,000, or 15.9%, and $11,092,000, or 7.1%, for the three and nine months ended September 30, 2024, respectively, compared to the prior year periods. This category includes interest costs offset by capitalized interest pertaining to development and redevelopment activity, amortization of premium/discount on debt, interest income and any mark-to-market impact from derivatives not in qualifying hedge relationships. The increases for the three and nine months ended September 30, 2024 are primarily due to increases in amounts of unsecured indebtedness and decreases in interest income compared to the prior year periods due to lower cash amounts invested. The increases for the three and nine months ended September 30, 2024 are also due to decreased capitalized interest, compared to the prior year periods.

Current wording

Interest expense, netincreased $5,098,000, or 9.3%, for the three months ended March 31, 2025, compared to the prior year period. This category includes interest costs offset by capitalized interest pertaining to development and redevelopment activity, amortization of premium/discount on debt, interest income and any mark-to-market impact from derivatives not in qualifying hedge relationships. The increases for the three months ended March 31, 2025 are primarily due to increased effective interest expense for our unsecured indebtedness, increased commercial paper outstanding and decreases in interest income compared to the prior year period due to lower cash amounts invested and lower rates. The increases for the three months ended March 31, 2025 are also due to decreased capitalized interest, compared to the prior year period.

Previous wording

Depreciation expense increased $11,140,000, or 5.5%, and $25,043,000, or 4.1%, for the three and nine months ended September 30, 2024, respectively, compared to the prior year periods, primarily due to the addition of newly developed apartment communities, partially offset by dispositions.

Current wording

Depreciation expense increased $5,619,000, or 2.6%, for the three months ended March 31, 2025, compared to the prior year period, primarily due to the addition of newly developed and acquired apartment communities, partially offset by dispositions.

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Casualty and impairment loss for the nine months ended September 30, 2024 was $2,935,000 and for the three and nine months ended September 30, 2023 was $3,499,000 and $8,550,000, respectively, for property and casualty damage to certain of our communities. The charge for the nine months ended September 30, 2024 relates to flooding and water damage at communities in California from extensive rainfall and a fire at a community in New Jersey. The charge for the three and nine months ended September 30, 2023 relates to damage across certain communities in our Northeast and California regions related to severe weather and other casualty events.

Current wording

Casualty and impairment loss for the three months ended March 31, 2024 was $2,935,000 for property and casualty damage to certain of our communities. The charge for the three months ended March 31, 2024 relates to flooding and water damage at communities in California from extensive rainfall and a fire at a community in New Jersey.

Previous wording

Gain on sale of communities increased $150,852,000 and $32,029,000 for the three and nine months ended September 30, 2024, respectively, compared to the prior year periods. The amount of gain realized in a given period depends on many factors, including the number of communities sold, the size and carrying value of the communities sold and the market conditions in the local area. For the three and nine months ended September 30, 2024, we sold two and five wholly-owned communities and recognized gains of $172,973,000 and $241,459,000, respectively. For the three and nine months ended September 30, 2023, we sold one and three wholly-owned communities and recognized gains of $22,121,000 and $209,430,000, respectively.

Current wording

Gain on sale of communities increased $56,539,000 for the three months ended March 31, 2025, compared to the prior year period. The amount of gain realized in a given period depends on many factors, including the number of communities sold, expected operating performance of the communities and the market conditions in the local area. For the three months ended March 31, 2025, we sold one wholly-owned community and recognized a gain of $56,469,000, with no sales in the three months ended March 31, 2024.

Previous wording

FFO and Core FFO do not represent net income in accordance with GAAP, and therefore should not be considered an alternative to net income, which remains the primary measure, as an indication of our performance. In addition, FFO and Core FFO as calculated by other REITs may not be comparable to our calculations of FFO and Core FFO.

Current wording

FFO and Core FFO do not represent (i) net income in accordance with GAAP, and therefore should not be considered an alternative to net income, which remains the primary measure, as an indication of our performance, or (ii) cash generated from operating activities in accordance with GAAP, and therefore should not be considered an alternative to net cash flows from operating activities, as determined by GAAP, as a measure of liquidity. In addition, FFO and Core FFO are not necessarily indicative of cash available to fund cash needs and may not be comparable to FFO and Core FFO as calculated by other REITs.

Previous wording

(1)Amounts consist primarily of net unrealized gains on technology investments.

Current wording

(1)Amounts consist primarily of net unrealized losses (gains) on technology investments.

Previous wording

(3)Reflects changes to expected credit losses associated with our lending commitments primarily under the SIP. The timing and amount of actual losses that will be incurred, if any, is to be determined.

Current wording

(2)Reflects changes to expected credit losses associated with our lending commitments primarily under the SIP. The timing and amount of actual losses that will be incurred, if any, is to be determined at the maturity of each respective lending agreement.

Previous wording

(5)Represents the imputed carry cost of for-sale residential condominiums at The Park Loggia. We compute this adjustment by multiplying the total capitalized cost of completed and unsold for-sale residential condominiums by our weighted average unsecured debt effective interest rate.

Current wording

(4)Comprised of gains on sale of non-operating real estate, as well as the imputed carry cost of for-sale residential condominiums at The Park Loggia. We compute this adjustment by multiplying the total capitalized cost of completed and unsold for-sale residential condominiums by our weighted average unsecured debt effective interest rate.

Previous wording

We had cash, cash equivalents and restricted cash of $792,477,000 at September 30, 2024, an increase of $261,517,000 from $530,960,000 at December 31, 2023. The following discussion relates to changes in cash, cash equivalents and restricted cash due to operating, investing and financing activities.

Current wording

We had cash, cash equivalents and restricted cash of $219,107,000 at March 31, 2025, a decrease of $47,969,000 from $267,076,000 at December 31, 2024. The following discussion relates to changes in cash, cash equivalents and restricted cash due to operating, investing and financing activities.

Previous wording

•Net cash used in investing activities was primarily due to (i) the investment of $691,744,000 in the development and redevelopment of communities, (ii) acquisition of four wholly-owned communities for $278,363,000 and (iii) capital expenditures of $140,985,000 for our wholly-owned communities and non-real estate assets. These amounts were partially offset by net proceeds from the disposition of five wholly-owned communities of $502,808,000.

Current wording

•Net cash used in investing activities was primarily due to (i) the investment of $237,282,000 in the development and redevelopment of communities, (ii) acquisition of two wholly-owned communities for $187,362,000 and (iii) capital expenditures of $48,626,000 for our wholly-owned communities and non-real estate assets. These amounts were partially offset by net proceeds from the disposition of one wholly-owned community of $63,651,000.

Previous wording

•Net cash used in financing activities was primarily due to payment of cash dividends in the amount of $720,136,000, partially offset by proceeds from the issuance of unsecured notes in the amount of $398,788,000.

Current wording

•Net cash used in financing activities was primarily due to payment of cash dividends in the amount of $243,678,000, partially offset by proceeds from the issuance of commercial paper in the amount of $224,942,000.

Previous wording

The $2,250,000,000 Credit Facility matures in September 2026. The interest rate that would be applicable to borrowings under the Credit Facility is 5.71% at October 31, 2024 and is composed of (i) the Secured Overnight Financing Rate ("SOFR"), applicable to the period of borrowing for a particular draw of funds from the facility (e.g., one month to maturity, three months to maturity, etc.), plus (ii) the current borrowing spread to SOFR of 0.805% per annum, which consists of a 0.10% SOFR adjustment plus 0.705% per annum, assuming a daily SOFR borrowing rate. The borrowing spread to SOFR can vary from SOFR plus 0.63% to SOFR plus 1.38% based upon the rating of our unsecured senior notes. There is also an annual facility commitment fee of 0.12% of the borrowing capacity under the facility, which can vary from 0.095% to 0.295% based upon the rating of our unsecured senior notes. The Credit Facility contains a sustainability-linked pricing component which provides for interest rate margin and commitment fee reductions or increases by meeting or missing targets related to environmental sustainability, specifically greenhouse gas emission reductions, with the adjustment determined annually. The annual determination under the sustainability-linked pricing component occurred in July 2024, maintaining reductions of approximately 0.02% to the interest rate margin and 0.005% to the commitment fee due to our achievement of sustainability targets.

Current wording

In April 2025, the Company entered into the Seventh Amended and Restated Revolving Loan Agreement with a syndicate of banks, which provides for a revolving variable rate unsecured credit facility, replacing our prior credit facility, dated September 27, 2022. The Amended Credit Facility (i) increased the borrowing capacity from $2,250,000,000 to $2,500,000,000, and (ii) extended the term of the Credit Facility from September 2026 to April 2030. The interest rate that would be applicable to borrowings under the Amended Credit Facility is 5.12% at April 30, 2025 and is composed of (i) the Secured Overnight Financing Rate ("SOFR"), applicable to the period of borrowing for a particular draw of funds from the facility (e.g., one month to maturity, three months to maturity, etc.), plus (ii) the current borrowing spread to SOFR of 0.705% per annum, assuming a daily SOFR borrowing rate. The borrowing spread to SOFR can vary from SOFR plus 0.65% to SOFR plus 1.40% per annum based upon the rating of our unsecured and unsubordinated long-term indebtedness. There is also an annual facility fee of 0.12% of the borrowing capacity under the facility, which can vary from 0.10% to 0.30% per annum based upon the rating of the Company's unsecured and unsubordinated long-term indebtedness. The Amended Credit Facility contains a sustainability-linked pricing component which provides for interest rate margin and commitment fee reductions or increases by meeting or missing targets related to environmental sustainability that can range from (0.025)% to 0.025% in the aggregate.

Previous wording

The availability on the Credit Facility as of October 31, 2024 is as follows (dollars in thousands):

Current wording

The availability on the Amended Credit Facility as of April 30, 2025 is as follows (dollars in thousands):

Previous wording

(1)In addition, we had $57,585 outstanding in additional letters of credit unrelated to the Credit Facility as of October 31, 2024.

Current wording

(1)In addition, we had $49,086 outstanding in additional letters of credit unrelated to the Amended Credit Facility as of April 30, 2025.

Previous wording

We have a Commercial Paper Program with the maximum aggregate face or principal amount outstanding at any one time not to exceed $500,000,000. Under the terms of the Commercial Paper Program, we may issue, from time to time, unsecured commercial paper notes with varying maturities of less than one year. The Commercial Paper Program is backstopped by our commitment to maintain available borrowing capacity under the Credit Facility in an amount equal to actual borrowings under the Commercial Paper Program.

Current wording

We have a Commercial Paper Program in which we may issue, unsecured commercial paper notes with maturities of less than one year. In April 2025, the Company increased the maximum amount of commercial paper that can be outstanding under its unsecured Commercial Paper Program from $500,000,000 to $1,000,000,000. The Commercial Paper Program is backstopped by our commitment to maintain available borrowing capacity under the Amended Credit Facility in an amount equal to actual borrowings under the Commercial Paper Program. As of April 30, 2025, we had $595,000,000 of borrowings outstanding under the Commercial Paper Program.

Previous wording

We are subject to financial covenants contained in the Credit Facility and the indentures under which our unsecured notes were issued. The principal financial covenants include the following:

Current wording

We are subject to financial covenants contained in the Credit Facility, the Term Loan and the indentures under which our unsecured notes were issued. The principal financial covenants include the following: