AvalonBay Communities, Inc. (NYSE:AVB) (the "Company") reported today that Net Income Attributable to Common Stockholders for the three months ended December 31, 2021 was $335,209,000. This resulted in a decrease in Earnings per Share – diluted ("EPS") for the three months ended December 31, 2021 of 1.6% to $2.40 from $2.44 for the prior year period, primarily attributable to a decrease in gain on sale of real estate and an increase in depreciation expense, as detailed in the table below.

Funds from Operations attributable to common stockholders - diluted ("FFO") per share for the three months ended December 31, 2021 increased 17.6% to $2.27 from $1.93 for the prior year period. Core FFO per share (as defined in this release) for the three months ended December 31, 2021 increased 12.4% to $2.27 from $2.02 for the prior year period.

The following table compares the Company's actual results for EPS, FFO per share and Core FFO per share for the three months ended December 31, 2021 to its results for the prior year period:


Q4 2021 Results Compared to Q4 2020
	Per Share (1)
	EPS			FFO			Core FFO
Q4 2020 per share reported results	$	2.44		$	1.93		$	2.02
Same Store Residential NOI (2)		0.17			0.17			0.17
Development and Other Stabilized Residential NOI		0.13			0.13			0.13
Commercial NOI		0.06			0.06			0.06
Overhead and other		0.05			0.05			(0.04	)
Capital markets and transaction activity		(0.06	)		(0.06	)		(0.06	)
Unconsolidated investment income		0.04			0.04			(0.01	)
Income taxes		(0.05	)		(0.05	)		—
Gain on sale of real estate and depreciation expense		(0.38	)		—			—
Q4 2021 per share reported results	$	2.40		$	2.27		$	2.27

(1) For additional detail on reconciling items between EPS, FFO and Core FFO, see Definitions and Reconciliations, table 2.
(2) Consists of a $0.17 increase in Residential revenue.

The following table compares the Company's actual results for EPS, FFO per share and Core FFO per share for the three months ended December 31, 2021 to its October 2021 outlook:


Q4 2021 Results Compared to October 2021 Outlook
	Per Share
	EPS			FFO			Core FFO
Projected per share - October 2021 outlook (1)	$	2.30		$	2.22		$	2.24
Same Store Residential NOI		0.01			0.01			0.01
Development and Other Stabilized Residential NOI		0.01			0.01			0.01
Commercial NOI		0.01			0.01			0.01
Capital markets and transaction activity		0.01			0.01			—
Unconsolidated investment income and other		0.04			0.04			—
Income taxes		(0.03	)		(0.03	)		—
Gain on sale of real estate and depreciation expense		0.05			—			—
Q4 2021 per share reported results	$	2.40		$	2.27		$	2.27

(1) The mid-point of the Company's October 2021 outlook.

For the year ended December 31, 2021, EPS increased 22.1% to $7.19 from $5.89 for the prior year, FFO per share decreased 3.8% to $8.13 from $8.45 for the prior year, and Core FFO per share decreased 4.9% to $8.26 from $8.69 for the prior year.

The following table compares the Company's actual results for EPS, FFO per share and Core FFO per share for the year ended December 31, 2021 to its results for the prior year:


Full Year 2021 Results Compared to Full Year 2020
	Per Share (1)
	EPS			FFO			Core FFO
2020 per share reported results	$	5.89		$	8.45		$	8.69
Same Store Residential NOI (2)		(0.47	)		(0.47	)		(0.47	)
Development and Other Stabilized Residential NOI		0.35			0.35			0.35
Commercial NOI		0.09			0.09			0.09
Overhead and other		—			—			(0.11	)
Capital markets and transaction activity		(0.31	)		(0.31	)		(0.26	)
Unconsolidated investment income		0.08			0.08			(0.03	)
Income taxes		(0.06	)		(0.06	)		—
Gain on sale of real estate and depreciation expense		1.62			—			—
2021 per share reported results	$	7.19		$	8.13		$	8.26

(1) For additional detail on reconciling items between EPS, FFO and Core FFO, see Definitions and Reconciliations, table 2.
(2) Consists of a $0.32 decrease in Residential revenue and $0.14 increase in Residential operating expenses.

Same Store Operating Results for the Three Months Ended December 31, 2021 Compared to the Prior Year Period

Same Store total revenue increased $30,373,000, or 6.1%, to $529,467,000. Residential revenue increased $23,803,000, or 4.8%, to $523,219,000, which includes a favorable reduction of uncollectible lease revenue of $6,501,000. Same Store Residential rental revenue increased 4.7%, as detailed in the following table:


Same Store Residential Rental Revenue Change
Q4 2021 Compared to Q4 2020
Residential rental revenue
Lease rates	1.9	%
Concessions and other discounts	(0.3	) %
Economic occupancy	1.7	%
Other rental revenue	0.1	%
Uncollectible lease revenue (1)	1.3	%
Total Residential rental revenue	4.7	%

(1) Uncollectible lease revenue decreased to 1.58% from 2.89% of total Residential rental revenue in the prior year period.

Same Store Residential operating expenses increased $759,000, or 0.5%, to $161,036,000 and Same Store Residential NOI increased $23,044,000, or 6.8%, to $362,183,000.

The following table presents percentage changes in Same Store Residential rental revenue, Residential operating expenses and Residential NOI for the three months ended December 31, 2021 compared to the three months ended December 31, 2020:


Q4 2021 Compared to Q4 2020
		Same Store Residential
	Rental Revenue (1)			Opex (2)				% of Q4 2021 NOI		Rental Revenue cash basis (3)

						NOI
New England		5.3	%	3.1	%	6.7	%	14.1	%	9.2	%
Metro NY/NJ		4.7	%	1.0	%	6.4	%	20.9	%	11.2	%
Mid-Atlantic		3.4	%	1.8	%	4.2	%	16.2	%	5.4	%
Southeast FL		17.3	%	(20.0	) %	48.9	%	1.6	%	19.2	%
Denver, CO		11.4	%	(7.8	) %	20.8	%	1.2	%	8.6	%
Pacific NW		4.4	%	(0.3	) %	7.0	%	5.2	%	7.3	%
No. California		(1.9	) %	(2.5	) %	(1.6	) %	17.9	%	4.1	%
So. California		10.0	%	1.9	%	13.9	%	22.9	%	9.9	%
Total		4.7	%	0.5	%	6.8	%	100.0	%	8.3	%

(1) See full release for additional detail.
(2) See full release for discussion of variances.
(3) The change in Residential Rental Revenue with Concessions on a Cash Basis.

Same Store Operating Results for the Year Ended December 31, 2021 Compared to the Prior Year

Same Store total revenue decreased $36,010,000, or 1.7%, to $2,046,173,000. Residential revenue decreased $45,983,000, or 2.2%, to $2,024,861,000, partially offset by a favorable reduction of uncollectible lease revenue of $2,227,000. Same Store Residential rental revenue decreased 2.2%, as detailed in the following table:


Same Store Residential Rental Revenue Change
Full Year 2021 Compared to Full Year 2020
Residential rental revenue
Lease rates	(2.0	) %
Concessions and other discounts	(1.8	) %
Economic occupancy	1.4	%
Other rental revenue	0.1	%
Uncollectible lease revenue (1)	0.1	%
Total Residential rental revenue	(2.2	) %

(1) Uncollectible lease revenue decreased to 2.16% from 2.21% of total Residential rental revenue in the prior year period.

Same Store Residential operating expenses increased $20,300,000, or 3.2%, to $654,579,000 and Same Store Residential NOI decreased $66,283,000, or 4.6%, to $1,370,282,000.

The following table presents percentage changes in Same Store Residential rental revenue, Residential operating expenses and Residential NOI for the year ended December 31, 2021 compared to the year ended December 31, 2020:


Full Year 2021 Compared to Full Year 2020
	Same Store Residential
	Rental Revenue (1)		Opex (2)				% of 2021 NOI		Rental Revenue cash basis (3)

					NOI
New England	(1.0	) %	4.1	%	(3.6	) %	14.1	%	0.4	%
Metro NY/NJ	(0.8	) %	3.1	%	(2.6	) %	20.8	%	1.6	%
Mid-Atlantic	(2.1	) %	4.7	%	(5.1	) %	16.4	%	(0.8	) %
Southeast FL	8.8	%	(10.5	) %	25.2	%	1.4	%	11.1	%
Denver, CO	11.5	%	(2.8	) %	19.2	%	1.2	%	10.9	%
Pacific NW	(2.6	) %	4.1	%	(5.7	) %	5.2	%	(0.7	) %
No. California	(10.0	) %	2.7	%	(14.4	) %	18.6	%	(6.0	) %
So. California	1.3	%	3.4	%	0.3	%	22.3	%	2.8	%
Total	(2.2	) %	3.2	%	(4.6	) %	100.0	%	(0.1	) %

(1) See full release for additional detail.
(2) See full release for discussion of variances.
(3) The change in Residential Rental Revenue with Concessions on a Cash Basis.

Same Store Collections Update

The following table provides an update for Same Store Residential revenue collections for Q2 2020 through Q4 2021 as of each respective quarter end, as well as through January 31, 2022 for the periods presented. Collected Residential revenue is the portion of apartment base rent charged to residents and other rentable items, such as parking and storage rent, along with pet and other fees in accordance with residential leases, that has been collected, including $28,286,000 of aggregate rent relief payments, of which $14,549,000 was received during the three months ended December 31, 2021 ("Collected Residential Revenue"), and excludes transactional and other fees.


Same Store Collections (1)
	Collected Residential Revenue
	At quarter end (2)		At January 31, 2022 (3)(4)
Q2 2020	95.4	%	98.5	%
Q3 2020	95.1	%	98.2	%
Q4 2020	94.7	%	98.1	%
Q1 2021	94.7	%	98.3	%
Q2 2021	95.0	%	98.8	%
Q3 2021	95.8	%	98.8	%
Q4 2021	95.6	%	97.0	%

(1) Collections are for the Company's 2021 Same Store communities and exclude commercial revenue, which was 1.0%, of the Company's 2021 Same Store total revenue.
(2) The Collected Residential Revenue percentage as of the last day in the respective quarter.
(3) The percentage of Collected Residential Revenue as of January 31, 2022.
(4) Collected Residential Revenue for January 2022 at January 31, 2022 was 93.0%, which is 94.9% of the AVB Residential Benchmark.

For further discussion of collection rates and limitations on use of this data, see "Same Store Collections," in Definitions and Reconciliations.

Development Activity

During the three months ended December 31, 2021, the Company completed the development of Avalon Easton II, located in Easton, MA. Avalon Easton II was constructed as a second phase of the Avalon Easton operating community, and contains 44 apartment homes and was constructed for a Total Capital Cost of $15,000,000.

During the three months ended December 31, 2021, the Company started the construction of three communities:

Avalon Princeton Circle, located in Princeton, NJ;

Avalon Montville, located in Montville, NJ; and

Avalon Redmond Campus, located in Redmond, WA.

Avalon Redmond Campus is a densification of the Company's existing eaves Redmond Campus operating community, where 48 existing older apartment homes were demolished and will be replaced by a new Avalon branded 214 apartment home community. In the aggregate, these communities will contain 785 apartment homes when completed and will be developed for an estimated Total Capital Cost of $291,000,000.

During 2021, the Company:

completed the development of nine communities containing an aggregate of 2,752 apartment homes and 29,000 square feet of commercial space for an aggregate Total Capital Cost of $1,070,000,000; and

commenced the development of 10 communities, which in the aggregate will contain 3,010 apartments homes when completed and will be developed for an estimated Total Capital Cost of $1,246,000,000.

At December 31, 2021, the Company had 17 consolidated Development communities under construction that are expected to contain 5,386 apartment homes and 40,000 square feet of commercial space. Estimated Total Capital Cost at completion for these Development communities is $2,140,000,000.

At December 31, 2021, the Company had two Unconsolidated Development communities under construction that in the aggregate are expected to contain 803 apartment homes and 56,000 square feet of commercial space.

The projected Total Capital Cost of Development Rights at December 31, 2021 was $3.3 billion.

Acquisition Activity

During the three months ended December 31, 2021, the Company acquired the following three communities in its expansion markets:

Avalon Fort Lauderdale, located in Fort Lauderdale, FL, containing 243 apartment homes and 49,000 square feet of commercial space that is 100% leased to Whole Foods Market, for a purchase price of $150,000,000;

Avalon Miramar, located in Miramar, FL, containing 380 apartment homes for a purchase price of $133,000,000; and

Hawk, located in Charlotte, NC, containing 71 apartment homes for a purchase price of $48,500,000. Hawk is the final community acquired in a three community portfolio in Charlotte, NC.

During the year ended December 31, 2021, the Company acquired seven wholly-owned communities containing 1,932 apartment homes and 90,000 square feet of commercial space for a total purchase price of $724,500,000 and a weighted average Market Cap Rate of 3.8%. Four of these communities marked the Company's entrance into the Dallas, Texas and Charlotte, North Carolina metropolitan regions.

On February 1, 2022, the Company acquired Avalon Flatirons, a wholly-owned operating community, located in Lafayette, Colorado, containing 207 apartment homes and 16,000 square feet of commercial space, for a purchase price of $95,000,000.

Disposition Activity

During the three months ended December 31, 2021, the Company sold two wholly-owned operating communities:

eaves Lawrenceville, located in Lawrenceville, NJ; and

Avalon at Center Place, located in Providence, RI.

In aggregate, these communities contain 857 apartment homes and 20,000 square feet of commercial space and were sold for $283,000,000 and a weighted average Market Cap Rate of 3.4%, resulting in a gain in accordance with GAAP of $216,188,000 and an Economic Gain of $140,017,000.

During the year ended December 31, 2021, the Company sold nine wholly-owned operating communities containing 2,404 apartment homes and 30,000 square feet of commercial space. These assets were sold for $867,200,000 and a weighted average Market Cap Rate of 3.7%, resulting in a gain in accordance with GAAP of $602,151,000 and an Economic Gain of $344,609,000.

During the three months and year ended December 31, 2021, the Company sold 10 and 53, respectively, of the 172 residential condominiums at The Park Loggia, located in New York, NY, for gross proceeds of $28,180,000 and $135,458,000, respectively. As of December 31, 2021, 123 of the 172 residential condominiums have been sold for aggregate gross proceeds of $351,830,000 and 87% of the 66,000 square feet of commercial space has been leased. In addition, subsequent to quarter end and through the date of this release, the Company sold nine residential condominiums for gross proceeds of $24,528,000, reducing inventory to be sold to 40 condominiums.

Liquidity and Capital Markets

At December 31, 2021, the Company did not have any borrowings outstanding under its $1,750,000,000 unsecured credit facility and had $543,788,000 in unrestricted cash and cash in escrow.

The Company's annualized Net Debt-to-Core EBITDAre (as defined in this release) for the fourth quarter of 2021 was 5.1 times and Unencumbered NOI (as defined in this release) for full year 2021 was 95%.

During the three months ended December 31, 2021, the Company had the following debt activity:

The Company repaid $73,060,000 principal amount of fixed rate debt with a weighted average interest rate of 3.79% secured by Avalon Westbury at par in advance of its November 2036 maturity date.

The Company issued $400,000,000 principal amount of unsecured notes in a public offering under its existing shelf registration statement for net proceeds before offering costs of $396,976,000. The notes mature in December 2028 and were issued with a 1.90% coupon. The effective interest rate of the notes is 2.04%, including the impact of offering costs. The notes were issued under the Company's green bond framework, and the Company has allocated or will allocate the net proceeds, in whole or in part, to one or more new or existing eligible green projects.

During the year ended December 31, 2021, in addition to the debt activity discussed above, the Company had the following debt activity:

The Company repaid $27,795,000 principal amount of 5.37% fixed rate debt in advance of its April 2021 maturity date.

The Company repaid $450,000,000 principal amount of its 2.95% unsecured notes in advance of the September 2022 maturity date.

The Company issued $700,000,000 principal amount of unsecured notes in a public offering under its existing shelf registration statement and the green bond framework for net proceeds before offering costs of $694,617,000. The notes mature in January 2032 and were issued with a 2.05% coupon and 2.16% effective interest rate.

During the three months and year ended December 31, 2021, under its current continuous equity program, the Company (i) sold 101,343 and 122,343 shares of common stock, respectively, at a weighted average sales price of $225.85 and $226.15 per share, respectively, for net proceeds of $22,545,000 and $27,253,000, respectively, and (ii) entered into a forward contract to sell 68,577 shares of common stock before 2023 for approximate proceeds of $16,000,000.

First Quarter and Full Year 2022 Financial Outlook

The following presents a summary of the Company's financial outlook for 2022, further details for which are provided in the full release.

For its first quarter and full year 2022 financial outlook, the Company expects the following:


Projected EPS, Projected FFO and Projected Core FFO Outlook (1)
	Q1 2022					Full Year 2022
	Low			High		Low			High
Projected EPS	$	1.73	—	$	1.85	$	6.56	—	$	7.06
Projected FFO per share	$	2.11	—	$	2.23	$	9.28	—	$	9.78
Projected Core FFO per share	$	2.14	—	$	2.26	$	9.30	—	$	9.80

(1) See Definitions and Reconciliations, table 8, for reconciliations of Projected FFO per share and Projected Core FFO per share to Projected EPS.

The following table compares the Company's actual results for EPS, FFO per share and Core FFO per share for the full year 2021 to its 2022 full year financial outlook:


Full Year 2022 Outlook
Comparison to Full Year 2021 Results

	Per Share
	EPS			FFO			Core FFO

2021 per share reported results	$	7.19		$	8.13		$	8.26
Same Store Residential revenue		1.21			1.21			1.21
Same Store Residential Opex		(0.22	)		(0.22	)		(0.22	)
Development and Other Stabilized Residential NOI		0.44			0.44			0.44
Commercial NOI		0.03			0.03			0.03
Capital markets and transaction activity		0.05			0.05			(0.08	)
Overhead and other		(0.11	)		(0.11	)		(0.09	)
Gain on sale of real estate, depreciation expense and casualty and impairment loss		(1.78	)		—			—
Projected per share - 2022 outlook (1)	$	6.81		$	9.53		$	9.55

(1) Represents the mid-point of the Company's February 2022 outlook.

The following table compares the Company's actual results for EPS, FFO per share and Core FFO per share for the fourth quarter of 2021 to its first quarter 2022 financial outlook:


Q4 2021 Results Compared to Q1 2022 Outlook
	Per Share
	EPS			FFO			Core FFO
Q4 2021 per share reported results	$	2.40		$	2.27		$	2.27
Same Store Residential revenue		0.02			0.02			0.02
Same Store Residential Opex		(0.06	)		(0.06	)		(0.06	)
Development and Other Stabilized Residential NOI		0.02			0.02			0.02
Commercial NOI		(0.01	)		(0.01	)		(0.01	)
Capital markets and transaction activity		(0.03	)		(0.03	)		(0.02	)
Overhead and other		(0.04	)		(0.04	)		(0.02	)
Gain on sale of real estate and depreciation expense		(0.51	)		—			—
Projected per share - Q1 2022 outlook (1)	$	1.79		$	2.17		$	2.20

(1) Represents the mid-point of the Company's February 2022 outlook.

First Quarter Conference Schedule

Management is scheduled to present at Citi's Global Property CEO Conference from March 6 - 9, 2022. During this conference, management may discuss the Company's current operating environment; operating trends; development, redevelopment, disposition and acquisition activity; financial outlook; portfolio strategy and other business and financial matters affecting the Company. Details on how to access a webcast of the Company's presentation will be available in advance of the conference event on the Company's website at http:// www.avalonbay.com/events.

Other Matters

The Company will hold a conference call on February 3, 2022 at 1:00 PM ET to review and answer questions about this release, its fourth quarter 2021 results and 2022 outlook, the Attachments (described below) and related matters. To participate on the call, dial 888-204-4368 and use conference id: 2633813.

To hear a replay of the call, which will be available from February 3, 2022 at 6:00 PM ET to February 10, 2022 at 6:00 PM ET, dial 888-203-1112 and use conference id: 2633813. A webcast of the conference call will also be available at http://www.avalonbay.com/earnings, and an online playback of the webcast will be available for at least seven days following the call.

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

In addition to the Attachments, the Company is providing a teleconference presentation that will be available on the Company's website at http://www.avalonbay.com/earnings subsequent to this release and before the market opens on February 3, 2022.

About AvalonBay Communities, Inc.

As of December 31, 2021, the Company owned or held a direct or indirect ownership interest in 297 apartment communities containing 87,992 apartment homes in 12 states and the District of Columbia, of which 19 communities were under development and one community was under redevelopment. The Company is an equity REIT in the business of developing, redeveloping, acquiring and managing apartment communities in leading metropolitan areas in New England, the New York/New Jersey Metro area, the Mid-Atlantic, the Pacific Northwest, and Northern and Southern California, as well as in the Company's expansion markets of Raleigh-Durham and Charlotte, North Carolina, Southeast Florida, Dallas and Austin, Texas, and Denver, Colorado. More information may be found on the Company's website at http://www.avalonbay.com. For additional information, please contact Jason Reilley, Vice President of Investor Relations, at 703-317-4681.

Forward-Looking Statements

This release, including its Attachments, contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements, which you can identify by the Company's use of words such as "expects," "plans," "estimates," "anticipates," "projects," "intends," "believes," "outlook" and similar expressions that do not relate to historical matters, are based on the Company's expectations, forecasts and assumptions at the time of this release, which may not be realized and involve risks and uncertainties that cannot be predicted accurately or that might not be anticipated. These could cause actual results to differ materially from those expressed or implied by the forward-looking statements. Risks and uncertainties that might cause such differences include those related to the COVID-19 pandemic, including the effect on the multifamily industry and the general economy of measures taken by businesses and the government, including measures to relieve economic distress, such as governmental limitations on the ability of multifamily owners to evict residents who are delinquent in the payment of their rent and federal efforts at economic stimulus; we may abandon development or redevelopment opportunities for which we have already incurred costs; adverse capital and credit market conditions may affect our access to various sources of capital and/or cost of capital, which may affect our business activities, earnings and common stock price, among other things; changes in local employment conditions, demand for apartment homes, supply of competitive housing products, landlord-tenant laws, including the adoption of new rent control regulations, and other economic or regulatory conditions may result in lower than expected occupancy and/or rental rates and adversely affect the profitability of our communities; delays in completing development, redevelopment and/or lease-up may result in increased financing and construction costs and may delay and/or reduce the profitability of a community; debt and/or equity financing for development, redevelopment or acquisitions of communities may not be available or may not be available on favorable terms; we may be unable to obtain, or experience delays in obtaining, necessary governmental permits and authorizations; expenses may result in communities that we develop or redevelop failing to achieve expected profitability; our assumptions concerning risks relating to our lack of control of joint ventures and our ability to successfully dispose of certain assets may not be realized; our assumptions and expectations in our financial outlook may prove to be too optimistic; and the timing and net proceeds of condominium sales may not equal our current expectations. Additional discussions of risks and uncertainties that could cause actual results to differ materially from those expressed or implied by the forward-looking statements appear in the Company's filings with the Securities and Exchange Commission, including the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2020 under the heading "Risk Factors" and under the heading "Management's Discussion and Analysis of Financial Condition and Results of Operations - Forward-Looking Statements" and in subsequent quarterly reports on Form 10-Q.

The Company does not undertake a duty to update forward-looking statements, including its expected 2022 operating results and other financial data forecasts contained in this release. The Company may, in its discretion, provide information in future public announcements regarding its outlook that may be of interest to the investment community. The format and extent of future outlooks may be different from the format and extent of the information contained in this release.

Definitions and Reconciliations

Non-GAAP financial measures and other capitalized terms, as used in this earnings release, are defined, reconciled and further explained on Attachment 14, Definitions and Reconciliations of Non-GAAP Financial Measures and Other Terms. Attachment 14 is included in the full earnings release available at the Company's website at http://www.avalonbay.com/earnings. This wire distribution includes only the following definitions and reconciliations.

AVB Residential Benchmark represents the average monthly revenue collections as a percentage of amounts billed for the referenced day of the month for the period from April 2019 to March 2020.

Average Rental Rates are calculated by the Company as Residential rental revenue in accordance with GAAP, divided by the weighted average number of occupied apartment homes.

Commercial represents results attributable to the non-apartment components of the Company's mixed-use communities and other non-residential operations.

Development is composed of consolidated communities that are either currently under construction, or were under construction and were completed during the current year. These communities may be partially or fully complete and operating.

Development Rights are development opportunities in the early phase of the development process for which the Company either has an option to acquire land or enter into a leasehold interest, for which the Company is the buyer under a long-term conditional contract to purchase land, where the Company controls the land through a ground lease or owns land to develop a new community, or where the Company is the designated developer in a public-private partnership. The Company capitalizes related pre-development costs incurred in pursuit of new developments for which the Company currently believes future development is probable.

EBITDA, EBITDAre and Core EBITDAre are considered by management to be supplemental measures of our financial performance. EBITDA is defined by the Company as net income or loss attributable to the Company before interest expense, income taxes, depreciation and amortization. EBITDAre is calculated by the Company in accordance with the definition adopted by the Board of Governors of the National Association of Real Estate Investment Trusts ("Nareit"), as EBITDA plus or minus losses and gains on the disposition of depreciated property, plus impairment write-downs of depreciated property, with adjustments to reflect the Company's share of EBITDAre of unconsolidated entities. Core EBITDAre is the Company's EBITDAre as adjusted for non-core items outlined in the table below. By further adjusting for items that are not considered part of the Company's core business operations, Core EBITDAre can help one compare the core operating and financial performance of the Company between periods. A reconciliation of EBITDA, EBITDAre and Core EBITDAre to net income is as follows (dollars in thousands):

TABLE 1
	Q4
	2021
Net income	$	335,298
Interest expense and loss on extinguishment of debt		55,911
Income tax expense		4,299
Depreciation expense		197,036
EBITDA	$	592,544

Gain on sale of communities		(213,881	)
Unconsolidated entity EBITDAre adjustments (1)		2,983
EBITDAre	$	381,646

Unconsolidated entity gains, net		(5,814	)
Casualty and impairment loss		2
Advocacy contributions		59
Executive transition compensation costs		411
Severance related costs		(73	)
Development pursuit write-offs and expensed transaction costs, net of recoveries		788
Gain on for-sale condominiums		(1,059	)
For-sale condominium marketing, operating and administrative costs		634
Gain on other real estate transactions, net		(95	)
Legal settlements		39
Core EBITDAre	$	376,538

(1) Includes joint venture interest, taxes, depreciation, gain on dispositions of depreciated real estate and impairment losses, if applicable, included in net income.

Economic Gain is calculated by the Company as the gain on sale in accordance with GAAP, less accumulated depreciation through the date of sale and any other adjustments that may be required under GAAP accounting. Management generally considers Economic Gain to be an appropriate supplemental measure to gain on sale in accordance with GAAP because it helps investors to understand the relationship between the cash proceeds from a sale and the cash invested in the sold community. The Economic Gain for disposed communities is based on their respective final settlement statements. A reconciliation of the aggregate Economic Gain to the aggregate gain on sale in accordance with GAAP for the wholly-owned operating communities disposed of during the year ended December 31, 2021 is presented elsewhere in the full release.

Economic Occupancy ("Ec Occ") is defined as total possible Residential revenue less vacancy loss as a percentage of total possible Residential revenue. Total possible Residential revenue (also known as "gross potential") is determined by valuing occupied units at contract rates and vacant units at Market Rents. Vacancy loss is determined by valuing vacant units at current Market Rents. By measuring vacant apartments at their Market Rents, Economic Occupancy takes into account the fact that apartment homes of different sizes and locations within a community have different economic impacts on a community's gross revenue.

FFO and Core FFO are considered by management to be supplemental measures of our operating and financial performance. FFO is calculated by the Company in accordance with the definition adopted by Nareit. FFO is calculated by the Company as Net income or loss attributable to common stockholders computed in accordance with GAAP, adjusted for gains or losses on sales of previously depreciated operating communities, cumulative effect of a change in accounting principle, impairment write-downs of depreciable real estate assets, write-downs of investments in affiliates which are driven by a decrease in the value of depreciable real estate assets held by the affiliate and depreciation of real estate assets, including adjustments for unconsolidated partnerships and joint ventures. By excluding gains or losses related to dispositions of previously depreciated operating communities 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 one compare the operating and financial performance of a company's real estate between periods or as compared to different companies. Core FFO is the Company's FFO as adjusted for non-core items outlined in the table below. By further adjusting for items that are not considered by us to be part of our core business operations, Core FFO can help one compare the core operating and financial performance of the Company between periods. A reconciliation of Net income attributable to common stockholders to FFO and to Core FFO is as follows (dollars in thousands):

TABLE 2
	Q4			Q4			Full Year			Full Year
	2021			2020			2021			2020
Net income attributable to common stockholders	$	335,209		$	341,128		$	1,004,299		$	827,630
Depreciation - real estate assets, including joint venture adjustments		195,749			176,840			753,755			704,331
Distributions to noncontrolling interests		12			12			48			48
Gain on sale of unconsolidated entities holding previously depreciated real estate		—			—			(23,305	)		(5,157	)
Gain on sale of previously depreciated real estate		(213,881	)		(249,106	)		(602,235	)		(340,444	)
Casualty and impairment loss on real estate		2			—			3,119			—
FFO attributable to common stockholders		317,091			268,874			1,135,681			1,186,408

Adjusting items:
Unconsolidated entity (gains) losses, net (1)		(5,814	)		289			(14,870	)		375
Business interruption insurance proceeds		—			—			—			(385	)
Lost NOI from casualty losses covered by business interruption insurance		—			—			—			48
Loss on extinguishment of consolidated debt		19			—			17,787			9,333
Gain on interest rate contract		—			(2,894	)		(2,654	)		(2,894	)
Advocacy contributions		59			5,484			59			8,558
Executive transition compensation costs		411			—			3,010			—
Severance related costs		(73	)		27			313			2,142
Development pursuit write-offs and expensed transaction costs, net of recoveries (2)		788			7,907			1,363			11,443
Gain on for-sale condominiums (3)		(1,059	)		(39	)		(3,110	)		(8,213	)
For-sale condominium marketing, operating and administrative costs (3)		634			1,650			4,087			5,662
For-sale condominium imputed carry cost (4)		1,252			2,304			7,031			11,317
Gain on other real estate transactions, net		(95	)		(112	)		(2,097	)		(440	)
Legal settlements		39			455			1,139			490
Income tax expense (benefit) (5)		4,299			(2,178	)		5,733			(3,247	)
Core FFO attributable to common stockholders	$	317,551		$	281,767		$	1,153,472		$	1,220,597

Average shares outstanding - diluted		139,928,816			139,632,368			139,717,399			140,435,195

Earnings per share - diluted	$	2.40		$	2.44		$	7.19		$	5.89
FFO per common share - diluted	$	2.27		$	1.93		$	8.13		$	8.45
Core FFO per common share - diluted	$	2.27		$	2.02		$	8.26		$	8.69

(1) Amounts for the three months and year ended December 31, 2021 include net unrealized gains on technology investments of $5,814 and $15,908, respectively. The amount for the year ended December 31, 2021 is partially offset by the write-off of asset management fee intangibles associated with the disposition of the final two AC JV communities.
(2) Amounts for 2020 include the write-off of $7,264 for a development opportunity in New York City that had a projected Total Capital Cost of $688,000.
(3) Aggregate impact of (i) Gain on for-sale condominiums and (ii) For-sale condominium marketing, operating and administrative costs, is a net gain of $425 for Q4 2021 and net expense of $977 for full year 2021 and a net expense of $1,611 for Q4 2020 and net gain of $2,551 for full year 2020, respectively.
(4) Represents the imputed carry cost of the for-sale residential condominiums at The Park Loggia. The Company computes this adjustment by multiplying the Total Capital Cost of completed and unsold for-sale residential condominiums by the Company's weighted average unsecured debt effective interest rate.
(5) Amounts are related to activity generated in the Company's taxable REIT subsidiaries ("TRS") and are comprised primarily of tax expense for condominium sales at The Park Loggia and other ancillary real estate for the three months and year ended December 31, 2021. The benefits for the three months and year ended December 31, 2020 related to tax losses as well as provisions of the Coronavirus Aid, Relief, and Economic Security Act (the "CARES" Act).

Interest Coverage is calculated by the Company as Core EBITDAre, divided by the sum of interest expense, net, and preferred dividends, if applicable. Interest Coverage is presented by the Company because it provides rating agencies and investors an additional means of comparing our ability to service debt obligations to that of other companies. A calculation of Interest Coverage for the three months ended December 31, 2021 is as follows (dollars in thousands):

TABLE 3

Core EBITDAre (1)	$	376,538

Interest expense	$	55,892

Interest Coverage	6.7 times

(1) For additional detail, see Definitions and Reconciliations, table 1.

Market Cap Rate is defined by the Company as Projected NOI of a single community for the first 12 months of operations (assuming no repositioning), less estimates for non-routine allowance of approximately $300 - $500 per apartment home, divided by the gross sales price for the community. Projected NOI, as referred to above, represents management's estimate of projected rental revenue minus projected operating expenses before interest, income taxes (if any), depreciation and amortization. For this purpose, management's projection of operating expenses for the community includes a management fee of 2.25%. The Market Cap Rate, which may be determined in a different manner by others, is a measure frequently used in the real estate industry when determining the appropriate purchase price for a property or estimating the value for a property. Buyers may assign different Market Cap Rates to different communities when determining the appropriate value because they (i) may project different rates of change in operating expenses and capital expenditure estimates and (ii) may project different rates of change in future rental revenue due to different estimates for changes in rent and occupancy levels. The weighted average Market Cap Rate is weighted based on the gross sales price of each community.

Market Rents as reported by the Company are based on the current market rates set by the Company based on its experience in renting apartments and publicly available market data. Trends in Market Rents for a region as reported by others could vary. Market Rents for a period are based on the average Market Rents during that period and do not reflect any impact for cash concessions.

Net Debt-to-Core EBITDAre is calculated by the Company as total debt (secured and unsecured notes and the Company's variable rate unsecured credit facility) that is consolidated for financial reporting purposes, less consolidated cash and cash in escrow, divided by annualized fourth quarter 2021 Core EBITDAre. A calculation of Net Debt-to-Core EBITDAre is as follows (dollars in thousands):

TABLE 4

Total debt principal (1)	$	8,170,431
Cash and cash in escrow		(543,788	)
Net debt	$	7,626,643

Core EBITDAre (2)	$	376,538

Core EBITDAre, annualized	$	1,506,152

Net Debt-to-Core EBITDAre		5.1 times

(1) Balance at December 31, 2021 excludes $10,033 of debt discount and $40,573 of deferred financing costs as reflected in unsecured notes, net, and $13,528 of debt discount and $2,750 of deferred financing costs as reflected in notes payable on the Condensed Consolidated Balance Sheets.
(2) For additional detail, see Definitions and Reconciliations, table 1.

NOI is defined by the Company as total property revenue less direct property operating expenses (including property taxes), and excluding corporate-level income (including management, development and other fees), corporate-level property management and other indirect operating expenses, expensed transaction, development and other pursuit costs, net of recoveries, interest expense, net, loss (gain) on extinguishment of debt, net, general and administrative expense, income from investments in unconsolidated entities, depreciation expense, corporate income tax expense (benefit), casualty and impairment loss, gain on sale of communities, gain on other real estate transactions, net, net for-sale condominium activity and net operating income from real estate assets sold or held for sale. The Company considers NOI to be an important and appropriate supplemental performance measure to Net Income of operating performance of a community or communities 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 groups of assets.

Residential NOI represents results attributable to the Company's apartment rental operations, including parking and other ancillary Residential revenue. A reconciliation of Residential NOI to Net Income, as well as a breakdown of Residential NOI by operating segment, is as follows (dollars in thousands):

TABLE 5
	Q4			Q4			Q3			Q2			Q1			Full Year			Full Year
	2021			2020			2021			2021			2021			2021			2020
Net income	$	335,298		$	341,114		$	78,847		$	447,977		$	142,234		$	1,004,356		$	827,706
Property management and other indirect operating expenses, net of corporate income		24,555			27,400			25,322			24,318			24,470			98,665			97,443
Expensed transaction, development and other pursuit costs, net of recoveries		1,331			8,110			417			1,653			(170	)		3,231			12,399
Interest expense, net		55,711			51,589			55,987			56,104			52,613			220,415			214,151
Loss (gain) on extinguishment of debt, net		19			—			17,890			—			(122	)		17,787			9,333
General and administrative expense		16,481			13,465			17,313			18,465			17,352			69,611			60,343
(Income) loss from investments in unconsolidated entities		(5,626	)		348			(6,867	)		(26,559	)		467			(38,585	)		(6,422	)
Depreciation expense		197,036			177,823			193,791			184,472			183,297			758,596			707,331
Income tax expense (benefit)		4,299			(2,178	)		2,179			10			(755	)		5,733			(3,247	)
Casualty and impairment loss		2			—			1,940			1,177			—			3,119			—
Gain on sale of communities		(213,881	)		(249,106	)		(58	)		(334,569	)		(53,727	)		(602,235	)		(340,444	)
Gain on other real estate transactions, net		(95	)		(112	)		(1,543	)		(32	)		(427	)		(2,097	)		(440	)
Net for-sale condominium activity		(425	)		1,611			(158	)		647			913			977			(2,551	)
NOI from real estate assets sold or held for sale		(2,801	)		(14,965	)		(4,064	)		(8,494	)		(9,536	)		(24,895	)		(67,418	)
NOI		411,904			355,099			380,996			365,169			356,609			1,514,678			1,508,184

Commercial NOI		(8,045	)		393			(6,769	)		(5,620	)		(5,311	)		(25,745	)		(12,559	)
Residential NOI	$	403,859		$	355,492		$	374,227		$	359,549		$	351,298		$	1,488,933		$	1,495,625

Residential NOI
Same Store:
New England	$	50,994		$	47,813		$	47,916		$	47,678		$	46,278		$	192,866		$	200,157
Metro NY/NJ		75,738			71,201			70,850			69,407			69,489			285,483			293,097
Mid-Atlantic		58,593			56,245			55,410			55,227			55,831			225,061			237,072
Southeast FL		5,904			3,966			5,015			4,545			4,178			19,642			15,683
Denver, CO		4,486			3,712			4,011			3,935			4,019			16,451			13,795
Pacific NW		18,733			17,506			17,929			17,714			17,183			71,559			75,894
No. California		64,848			65,901			62,566			62,854			63,558			253,826			296,357
So. California		82,887			72,795			78,362			72,491			71,654			305,394			304,510
Total Same Store		362,183			339,139			342,059			333,851			332,190			1,370,282			1,436,565
Other Stabilized		21,127			12,053			15,396			14,367			12,583			63,474			48,190
Development/Redevelopment		20,549			4,300			16,772			11,331			6,525			55,177			10,870
Residential NOI	$	403,859		$	355,492		$	374,227		$	359,549		$	351,298		$	1,488,933		$	1,495,625

NOI as reported by the Company does not include the operating results from assets sold or classified as held for sale. A reconciliation of NOI from communities sold or classified as held for sale is as follows (dollars in thousands):

TABLE 6
	Q4			Q4			Q3			Q2			Q1			Full Year			Full Year
	2021			2020			2021			2021			2021			2021			2020

Revenue from real estate assets sold or held for sale	$	5,102		$	24,451		$	7,145		$	14,463		$	16,146		$	42,857		$	109,371
Operating expenses from real estate assets sold or held for sale		(2,301	)		(9,486	)		(3,081	)		(5,969	)		(6,610	)		(17,962	)		(41,953	)
NOI from real estate assets sold or held for sale	$	2,801		$	14,965		$	4,064		$	8,494		$	9,536		$	24,895		$	67,418

Commercial NOI is composed of the following components (in thousands):

TABLE 7
	Q4			Q4			Q3			Q2			Q1			Full Year			Full Year
	2021			2020			2021			2021			2021			2021			2020

Commercial Revenue	$	9,396		$	894		$	8,283		$	7,046		$	6,754		$	31,479		$	17,748
Commercial Operating Expenses		(1,351	)		(1,287	)		(1,514	)		(1,426	)		(1,443	)		(5,734	)		(5,189	)
Commercial NOI	$	8,045		$	(393	)	$	6,769		$	5,620		$	5,311		$	25,745		$	12,559

Other Stabilized is composed of completed consolidated communities that the Company owns, which have Stabilized Operations as of January 1, 2021, or which were acquired subsequent to January 1, 2020. Other Stabilized excludes communities that are conducting or are probable to conduct substantial redevelopment activities.

Projected FFO and Projected Core FFO, as provided within this release in the Company's outlook, are calculated on a basis consistent with historical FFO and Core FFO, and are therefore considered to be appropriate supplemental measures to projected Net Income from projected operating performance. A reconciliation of the ranges provided for Projected FFO per share (diluted) for the fourth quarter and full year 2021 to the ranges provided for projected EPS (diluted) and corresponding reconciliation of the ranges for Projected FFO per share to the ranges for Projected Core FFO per share are as follows:

TABLE 8
	Low Range			High Range
Projected EPS (diluted) - Q1 2022	$	1.73		$	1.85
Depreciation (real estate related)		1.42			1.42
Gain on sale of communities		(1.04	)		(1.04	)
Projected FFO per share (diluted) - Q1 2022		2.11			2.23

Non-core transaction activity		0.02			0.02
Income tax expense and executive transition compensation costs		0.01			0.01
Projected Core FFO per share (diluted) - Q1 2022	$	2.14		$	2.26

Projected EPS (diluted) - Full Year 2022	$	6.56		$	7.06
Depreciation (real estate related)		5.68			5.68
Gain on sale of communities		(2.96	)		(2.96	)
Projected FFO per share (diluted) - Full Year 2022		9.28			9.78

Adjustments related to residential for-sale condominiums at The Park Loggia (1)		(0.01	)		(0.01	)
Non-core transaction activity		(0.01	)		(0.01	)
Development pursuit write-offs and expensed transaction costs, net of recoveries		0.01			0.01
Executive transition compensation costs		0.01			0.01
Income tax expense		0.02			0.02
Projected Core FFO per share (diluted) - Full Year 2022	$	9.30		$	9.80

(1) The Park Loggia adjustments relate to the following for the for-sale condominiums: operating expenses incurred, GAAP gain after taxes and cost of sales, and imputed carry costs on unsold homes.

Projected NOI, as used within this release for certain Development communities and in calculating the Market Cap Rate for dispositions, represents management's estimate, as of the date of this release (or as of the date of the buyer's valuation in the case of dispositions), of projected stabilized rental revenue minus projected stabilized operating expenses. For Development communities, Projected NOI is calculated based on the first twelve months of Stabilized Operations following the completion of construction. In calculating the Market Cap Rate, Projected NOI for dispositions is calculated for the first twelve months following the date of the buyer's valuation. Projected stabilized rental revenue represents management's estimate of projected gross potential minus projected stabilized economic vacancy and adjusted for projected stabilized concessions plus projected stabilized other rental revenue. Projected stabilized operating expenses do not include interest, income taxes (if any), depreciation or amortization, or any allocation of corporate-level property management overhead or general and administrative costs. In addition, projected stabilized operating expenses for Development communities do not include property management fee expense. Projected gross potential for Development communities and dispositions is generally based on leased rents for occupied homes and management's best estimate of rental levels for homes which are currently unleased, as well as those homes which will become available for lease during the twelve month forward period used to develop Projected NOI. The weighted average Projected NOI as a percentage of Total Capital Cost ("Weighted Average Initial Projected Stabilized Yield") is weighted based on the Company's share of the Total Capital Cost of each community, based on its percentage ownership.

Management believes that Projected NOI of the Development communities, on an aggregated weighted average basis, assists investors in understanding management's estimate of the likely impact on operations of the Development communities when the assets are complete and achieve stabilized occupancy (before allocation of any corporate-level property management overhead, general and administrative costs or interest expense). However, in this release the Company has not given a projection of NOI on a company-wide basis. Given the different dates and fiscal years for which NOI is projected for these communities, the projected allocation of corporate-level property management overhead, general and administrative costs and interest expense to communities under development is complex, impractical to develop, and may not be meaningful. Projected NOI of these communities is not a projection of the Company's overall financial performance or cash flow. There can be no assurance that the communities under development will achieve the Projected NOI as described in this release.

Redevelopment is composed of consolidated communities where substantial redevelopment is in progress or is probable to begin during the current year. Redevelopment is considered substantial when (i) capital invested during the reconstruction effort 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. Redevelopment includes one community containing 344 apartment homes that is currently under active redevelopment as of December 31, 2021.

Residential represents results attributable to the Company's apartment rental operations, including parking and other ancillary Residential revenue.

Residential Rental Revenue with Concessions on a Cash Basis is considered by the Company to be a supplemental measure to Residential rental revenue in conformity with GAAP to help investors evaluate the impact of both current and historical concessions on GAAP-based Residential rental revenue and to more readily enable comparisons to revenue as reported by other companies. In addition, Residential Rental Revenue with Concessions on a Cash Basis allows an investor to understand the historical trend in cash concessions.

A reconciliation of Same Store Residential rental revenue in conformity with GAAP to Residential Rental Revenue with Concessions on a Cash Basis is as follows (dollars in thousands):

TABLE 9
	Q4			Q4			Q3			Full Year			Full Year
	2021			2020			2021			2021			2020
Residential rental revenue (GAAP basis)	$	522,880		$	499,212		$	512,457		$	2,023,412		$	2,069,055
Residential concessions amortized		11,830			10,558			15,298			58,299			20,109
Residential concessions granted		(4,450	)		(20,081	)		(8,472	)		(42,237	)		(48,446	)

Residential Rental Revenue with Concessions on a Cash Basis	$	530,260		$	489,689		$	519,283		$	2,039,474		$	2,040,718

				Q4 2021			Q4 2021						Full year 2021
				vs. Q4 2020			vs. Q3 2021						vs. full year 2020
% change -- GAAP revenue					4.7	%		2.0	%					(2.2	) %

% change -- cash revenue					8.3	%		2.1	%					(0.1	) %

Same Store is composed of consolidated communities in the markets where the Company has a significant presence and where a comparison of operating results from the prior year to the current year is meaningful, as these communities were owned and had Stabilized Operations, as defined below, as of the beginning of the respective prior year period. Therefore, for 2021 operating results, Same Store is composed of consolidated communities that have Stabilized Operations as of January 1, 2020, are not conducting or are not probable to conduct substantial redevelopment activities and are not held for sale or probable for disposition within the current year.

Same Store Collections are the collection rates based on individual resident and commercial tenant activity as reflected in the Company's property management systems, and are presented to provide information about collections trends during the COVID-19 pandemic. Prior to the COVID-19 pandemic, the collections information provided was not routinely produced for internal use by senior management or publicly disclosed by the Company, and is a result of analysis that is not subject to internal controls over financial reporting. This information is not prepared in accordance with GAAP, does not reflect GAAP revenue or cash flow metrics, may be subject to adjustment in preparing GAAP revenue and cash flow metrics at the end of the three months and year ended December 31, 2021. Additionally, this information should not be interpreted as predicting the Company's financial performance, results of operations or liquidity for any period.

Stabilized Operations/Restabilized Operations is defined as the earlier of (i) attainment of 90% physical occupancy or (ii) the one-year anniversary of completion of development or redevelopment.

Total Capital Cost includes all capitalized costs projected to be or actually incurred to develop the respective Development or Redevelopment community, including land acquisition costs, construction costs, real estate taxes, capitalized interest and loan fees, permits, professional fees, allocated development overhead and other regulatory fees, offset by proceeds from the sale of any associated land or improvements, all as determined in accordance with GAAP. Total Capital Cost also includes costs incurred related to first generation commercial tenants, such as tenant improvements and leasing commissions. For Redevelopment communities, Total Capital Cost excludes costs incurred prior to the start of redevelopment when indicated. With respect to communities where development or redevelopment was completed in a prior or the current period, Total Capital Cost reflects the actual cost incurred, plus any contingency estimate made by management. Total Capital Cost for communities identified as having joint venture ownership, either during construction or upon construction completion, represents the total projected joint venture contribution amount. For joint ventures not in construction, Total Capital Cost is equal to gross real estate cost.

Unconsolidated Development is composed of communities that are either currently under construction, or were under construction and were completed during the current year, in which we have an indirect ownership interest through our investment interest in an unconsolidated joint venture. These communities may be partially or fully complete and operating.

Unencumbered NOI as calculated by the Company represents NOI generated by real estate assets unencumbered by outstanding secured notes payable as of December 31, 2021 as a percentage of total NOI generated by real estate assets. The Company believes that current and prospective unsecured creditors of the Company view Unencumbered NOI as one indication of the borrowing capacity of the Company. Therefore, when reviewed together with the Company's Interest Coverage, EBITDA and cash flow from operations, the Company believes that investors and creditors view Unencumbered NOI as a useful supplemental measure for determining the financial flexibility of an entity. A calculation of Unencumbered NOI for the year ended December 31, 2021 is as follows (dollars in thousands):

TABLE 10
	Full Year 2021
	NOI
Residential NOI:
Same Store	$	1,370,282
Other Stabilized		63,474
Development/Redevelopment		55,177
Total Residential NOI		1,488,933
Commercial NOI		25,745
NOI from real estate assets sold or held for sale		24,895
Total NOI generated by real estate assets		1,539,573
Less NOI on encumbered assets		(78,827	)
NOI on unencumbered assets	$	1,460,746

Unencumbered NOI		95	%

View source version on businesswire.com: https://www.businesswire.com/news/home/20220201006246/en/

AvalonBay Communities, Inc. Announces 2021 Operating Results and Initial 2022 Financial Outlook