Equity Residential Sells Large San Diego Asset

Proceeds to be Used to Address Sole Significant 2021 Debt Maturity

CHICAGO, IL (STL.News) Equity Residential (NYSE: EQR) Monday announced that the Company has sold an apartment property in San Diego and used the sale proceeds to enhance its already strong financial position by addressing 2021 debt maturities.

The Company sold Vantage Pointe, a 679-unit apartment property located in downtown San Diego, for a sale price of approximately $312.5 million at a Disposition Yield of 4.1%, generating a preliminary Un-levered IRR of 8.8% over the Company’s ten-year ownership period.  The Company used the proceeds from this sale as well as cash on hand and borrowings under its commercial paper program to satisfy its obligations on its $750.0 million 4.625% unsecured notes which are due in December 2021, by discharging them pursuant to their indenture.  As a result, the Company will incur approximately $39.1 million in debt extinguishment charges, of which $25.8 million represents a cash charge and the remaining $13.3 million corresponds to write-offs of un-amortized debt costs.  These charges will impact the Company’s 2020 Earnings Per Share and Funds from Operations per share but will not impact the Company’s Normalized Funds from Operations per share.

“We are pleased to execute on the opportunity to sell this asset at a price that we had ascribed to the property pre-pandemic,” said Mark J. Parrell, Equity Residential’s President and CEO.  “The use of these proceeds to address our only significant 2021 maturity leaves us with minimal near-term maturities, preserves the flexibility of our balance sheet and maintains credit capacity for future opportunities.”