Form: 10-K

Annual report pursuant to Section 13 and 15(d)

March 3, 2014

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Washington, D.C. 20549



For the fiscal year ended December 31, 2013

Commission file number 1-12672

(Exact name of registrant as specified in its charter)

(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer
Identification No.)

Ballston Tower
671 N. Glebe Rd, Suite 800
Arlington, Virginia 22203
(Address of principal executive office)
(703) 329-6300
(Registrant's telephone number, including area code)

         Securities registered pursuant to Section 12(b) of the Act:

(Title of each class)   (Name of each exchange on which registered)
Common Stock, par value $.01 per share   New York Stock Exchange

         Securities registered pursuant to Section 12(g) of the Act: None

         Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes  ý    No  o

         Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.    Yes  o    No  ý

         Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding twelve (12) months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ý    No  o

         Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  ý    No  o

         Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.    ý

         Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer ý   Accelerated filer o   Non-accelerated filer o
(Do not check if a
smaller reporting company)
  Smaller repobrting company o

         Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).    Yes  o    No  ý

         The aggregate market value of the registrant's Common Stock, par value $.01 per share, held by nonaffiliates of the registrant, as of June 28, 2013 was $17,455,382,529.

         The number of shares of the registrant's Common Stock, par value $.01 per share, outstanding as of January 31, 2014 was 129,417,333.

Documents Incorporated by Reference

         Portions of AvalonBay Communities, Inc.'s Proxy Statement for the 2014 annual meeting of stockholders, a definitive copy of which will be filed with the SEC within 120 days after the year end of the year covered by this Form 10-K, are incorporated by reference herein as portions of Part III of this Form 10-K.


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ITEM 1a.





ITEM 1b.




































ITEM 7a.















ITEM 9a.





ITEM 9b.






ITEM 10.





ITEM 11.





ITEM 12.





ITEM 13.





ITEM 14.






ITEM 15.








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        This Form 10-K contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Our actual results could differ materially from those set forth in each forward-looking statement. Certain factors that might cause such a difference are discussed in this report, including in the section entitled "Forward-Looking Statements" included in this Form 10-K. You should also review Item 1a., "Risk Factors," for a discussion of various risks that could adversely affect us.



        AvalonBay Communities, Inc. (the "Company," which term, unless the context otherwise requires, refers to AvalonBay Communities, Inc. together with its subsidiaries) is a Maryland corporation that has elected to be treated as a real estate investment trust ("REIT") for federal income tax purposes. We engage in the development, redevelopment, acquisition, ownership and operation of multifamily communities located primarily in high barrier to entry markets of the United States. These barriers to entry generally include a difficult and lengthy entitlement process with local jurisdictions and dense urban or suburban areas where zoned and entitled land is in limited supply. Our primary markets are located in New England, the New York/New Jersey Metro area, the Mid-Atlantic, the Pacific Northwest, and the Northern and Southern California regions of the United States. We focus on these markets because we believe that, over the long-term, a limited new supply of apartment homes and lower housing affordability in these markets will result in higher growth in cash flows relative to other markets.

        At January 31, 2014, we owned or held a direct or indirect ownership interest in:

    244 operating apartment communities containing 72,811 apartment homes in twelve states and the District of Columbia, of which 214 communities containing 63,514 apartment homes were consolidated for financial reporting purposes, three communities containing 979 apartment homes were held by joint ventures in which we hold an ownership interest, and 27 communities containing 8,318 apartment homes were owned by the Funds (as defined below). Three of the consolidated communities containing 1,126 apartment homes were under redevelopment, as discussed below;

    29 wholly-owned communities under construction that are expected to contain an aggregate of 8,708 apartment homes when completed, including one community in which we had an indirect interest expected to contain 103 apartment homes; and

    rights to develop an additional 46 communities that, if developed in the manner expected, will contain an estimated 12,986 apartment homes; and

    an indirect interest in a joint venture formed with Equity Residential (as defined in this Form 10-K) which owns direct and indirect interests in assets acquired as part of the Archstone Acquisition, including a direct interest in apartment communities in Germany, an indirect interest in a joint venture which owns six apartment communities with 1,902 apartment homes in the United States, and two land parcels.

        We generally obtain ownership in an apartment community by developing a new community on vacant land or by acquiring an existing community. In selecting sites for development or acquisition, we favor locations that are near expanding employment centers and convenient to transportation, recreation areas, entertainment, shopping and dining.

        Our consolidated real estate investments consist of the following reportable segments: Established Communities, Other Stabilized Communities and Development/Redevelopment Communities.


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Established Communities are generally operating communities that were owned and had stabilized occupancy and operating expenses as of the beginning of the prior year such that year-over-year comparisons are meaningful. Other Stabilized Communities are generally all other operating communities that have stabilized occupancy and operating expenses during the current year, but that were not owned or had not achieved stabilization as of the beginning of the prior year such that year-over-year comparisons are not meaningful, as well as communities that are planned for disposition during the current year. Development/Redevelopment Communities consist of communities that are under construction, communities where substantial redevelopment is in progress or is planned to begin during the current year and communities under lease-up. A more detailed description of these segments and other related information can be found in Note 9, "Segment Reporting," of the Consolidated Financial Statements set forth in Item 8 of this report.

        Our principal financial goal is to increase long-term stockholder value through the development, redevelopment, acquisition, operation, 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 an interest in apartment communities in high barrier to entry markets with growing or high potential for demand and high for-sale housing costs, (iii) 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 (iv) endeavor to maintain a capital structure that is aligned with our business risks with a view to maintaining continuous access to cost-effective capital. Our strategy is to be leaders in multifamily market research, consumer insight and capital allocation, delivering a range of multifamily offerings tailored to serve the needs of the most attractive customer segments in the best-performing U.S. submarkets. A substantial majority of our current communities are upscale, which generally command among the highest rents in their markets. However, we also pursue the ownership and operation of apartment communities that target a variety of customer segments and price points, consistent with our goal of offering a broad range of products and services.

        We operate our apartment communities under three core brands Avalon, AVA, and Eaves by Avalon. We believe that this branding differentiation allows us to target our product offerings to multiple customer groups and submarkets within our existing geographic footprint. The "Avalon" brand is our core offering, focusing on upscale apartment living and high end amenities and services in urban and suburban markets. Our "AVA" brand is designed for people who want to live in or near urban neighborhoods and in close proximity to public transportation, services, shopping and night-life. AVA apartments are generally smaller, many engineered for roommate living, and feature modern design and a technology focus. Our Eaves by Avalon brand is designed for renters who seek good quality apartment living, often in a suburban setting, with practical amenities and services at a more modest price point.

        During the three years ended December 31, 2013, excluding activity for the Funds (as defined below), we acquired 59 apartment communities, of which 54 were acquired as part of the Archstone Acquisition (as defined in this Form 10-K). In addition, in conjunction with the Archstone Acquisition, excluding investments in joint ventures formed with Equity Residential, we acquired interests in three unconsolidated joint ventures, as discussed below, which own an aggregate of 12 apartment communities. During the three years ended December 31, 2013, we disposed of 15 apartment communities, four of which were acquired in the Archstone Acquisition, and completed the development of 26 apartment communities and the redevelopment of 24 apartment communities. During 2012 we also purchased our joint venture partner's interest in one operating community, obtaining a 100% ownership interest in that apartment community. In addition, in 2011 we exchanged a portfolio of three communities and a parcel of land we owned for a portfolio of six communities and $26,000,000 in cash. In addition, we sold one community in 2014 through the date this Form 10-K was filed.


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        In March 2005, we formed AvalonBay Value Added Fund, L.P. ("Fund I"), a private, discretionary real estate investment vehicle, which we manage and in which we own a 15.2% interest. Fund I acquired communities with the objective of either redeveloping or repositioning them, or taking advantage of market cycle timing and improved operating performance. From its inception in March 2005 through the close of its investment period in March 2008, Fund I acquired 20 communities. During the three years ended December 31, 2013, we realized our pro rata share of the gain from the sale of 16 communities owned by Fund I.

        In September 2008, we formed AvalonBay Value Added Fund II, L.P. ("Fund II"), a second institutional discretionary real estate investment fund which we manage and in which we own a 31.3% interest. In 2012, Fund II acquired its final operating community, which was an active acquisition candidate as of August 2011, the end of the investment period for Fund II. From the commencement of Fund II through the close of the investment period, Fund II acquired 13 operating communities. During the three years ended December 31, 2013, we realized our pro rata share of the gain from the sale of one community owned by Fund II.

        In conjunction with the Archstone Acquisition, excluding joint ventures formed with Equity Residential, we acquired interests in three additional joint ventures, Brandywine Apartments of Maryland, LLC ("Brandywine"), Archstone Multifamily Partners AC LP (the "U.S. Fund") and Multifamily Partners AC JV LP (the "AC JV").

        Brandywine owns a 305 apartment home community located in Washington, DC, which is managed by a third party. Brandywine is comprised of five members who hold various interests in the joint venture. In conjunction with the Archstone Acquisition, we acquired a 26.1% equity interest in the venture, and subsequently purchased an additional 2.6% interest, and as of December 31, 2013, hold a 28.7% equity interest in the venture.

        The U.S. Fund was formed in July 2011 and is fully invested. The U.S. Fund owns nine communities containing 1,726 apartment homes, one of which includes a marina containing 229 boat slips. Through subsidiaries, we acquired and own the general partner of the fund and hold a 28.6% interest in the fund.

        The AC JV is a joint venture in which we acquired Archstone's 20% ownership interest. The AC JV was formed in 2011 and owns two operating apartment communities containing 818 apartment homes in Cambridge, MA and Herndon, VA, and one development community which, if completed as expected, will contain 103 apartment homes in Cambridge, MA. The AC JV partnership agreement contains provisions that require us to provide a right of first offer ("ROFO") to the AC JV in connection with additional opportunities to acquire or develop additional interests in multifamily real estate assets within a specified geographic radius of the existing assets, generally one mile or less. We own one land parcel for the development of 301 apartment homes, classified as a Development Right in Cambridge, MA, acquired as part of the Archstone Acquisition that is subject to the ROFO restrictions. The ROFO restriction expires in 2019.

        A more detailed description of Fund I, Fund II, the U.S. Fund and the AC JV (collectively, the "Funds"), Brandywine and the related investment activity can be found in the discussion in Note 6, "Investments in Real Estate Entities," of the Consolidated Financial Statements in Item 8 of this report and in Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations."

        Including sales by unconsolidated entities and entities in which we held a residual profits interest, during 2013 we sold 16 operating communities and recognized a gain in accordance with U.S. generally accepted accounting principles ("GAAP") of $292,684,000.

        A further discussion of our development, redevelopment, disposition, acquisition, property management and related strategies follows.


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        Development Strategy.    We select land for development and follow established procedures that we believe minimize both the cost and the risks of development. As one of the largest developers of multifamily rental apartment communities in high barrier to entry markets of the United States, we identify development opportunities through local market presence and access to local market information achieved through our regional offices. In addition to our principal executive office in Arlington, Virginia, we also maintain regional offices, administrative offices or specialty offices, including offices that are in or near the following cities:

    Boston, Massachusetts;

    Long Island, New York;

    Los Angeles, California;

    New York, New York;

    Newport Beach, California;

    San Francisco, California;

    San Jose, California;

    Seattle, Washington;

    Fairfield, Connecticut;

    Virginia Beach, Virginia; and

    Woodbridge, New Jersey.

        After selecting a target site, we usually negotiate for the right to acquire the site either through an option or a long-term conditional contract. Options and long-term conditional contracts generally allow us to acquire the target site shortly before the start of construction, which reduces development-related risks and preserves capital. However, as a result of competitive market conditions for land suitable for development, we have sometimes acquired and held land prior to construction for extended periods while entitlements are obtained, or acquired land zoned for uses other than residential with the potential for rezoning. For further discussion of our Development Rights, refer to Item 2. "Communities" in this report.

        We generally act as our own general contractor and construction manager, except for certain mid-rise and high-rise apartment communities and certain development communities acquired as part of the Archstone Acquisition, where we may elect to use third-party general contractors as construction managers. We generally perform these functions directly (although we may use a wholly-owned subsidiary) both for ourselves and for the joint ventures and partnerships of which we are a member or a partner. We believe direct involvement in construction enables us to achieve higher construction quality, greater control over construction schedules and cost savings. Our development, property management and construction teams monitor construction progress to ensure quality workmanship and a smooth and timely transition into the leasing and operating phase.

        During periods where competition for development land is more intense, we may acquire improved land with existing commercial uses and rezone the site for multifamily residential use. During the period that we hold these buildings for future development, any rent received in excess of expenses from these operations, which we consider to be incidental, is accounted for as a reduction in our investment in the development pursuit and not as net income. Any expenses relating to these operations, in excess of any rents received, are accounted for as a reduction in net income. We have also participated, and may in the future participate, in master planned or other large multi-use developments where we commit to build infrastructure (such as roads) to be used by other participants or commit to act as construction manager or general contractor in building structures or spaces for


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third parties (such as unimproved ground floor retail space, municipal garages or parks). Costs we incur in connection with these activities may be accounted for as additional invested capital in the community or we may earn fee income for providing these services. Particularly with large scale, urban in-fill developments, we may engage in significant environmental remediation efforts to prepare a site for construction.

        Throughout this report, the term "development" is used to refer to the entire property development cycle, including pursuit of zoning approvals, procurement of architectural and engineering designs and the construction process. References to "construction" refer to the actual construction of the property, which is only one element of the development cycle.

        Redevelopment Strategy.    When we undertake the redevelopment of a community, our goal is to renovate and/or rebuild an existing community so that our total investment is generally below replacement cost and the community is well positioned in the market to achieve attractive returns on our capital. We have a dedicated group of associates and procedures that are intended to control both the cost and risks of redevelopment. Our redevelopment teams, which include redevelopment, construction and property management personnel, monitor redevelopment progress. We believe we achieve significant cost savings by acting as our own general contractor. More importantly, this helps to ensure quality design and workmanship and a smooth and timely transition into the lease-up and restabilization phases.

        Throughout this report, the term "redevelopment" is used to refer to the entire redevelopment cycle, including planning and procurement of architectural and engineering designs, budgeting and actual renovation work. The actual renovation work is referred to as "reconstruction," which is only one element of the redevelopment cycle.

        Disposition Strategy.    We sell assets that no longer meet our long-term strategy or when market conditions are favorable, and we redeploy the proceeds from those sales to develop, redevelop and acquire communities and to rebalance our portfolio across or within geographic regions. This also allows us to realize a portion of the value created through our investments and provides additional liquidity. We are then able to redeploy the net proceeds from our dispositions in lieu of raising that amount of capital externally. When we decide to sell a community, we generally solicit competing bids from unrelated parties for these individual assets and consider the sales price of each proposal.

        We acquired 16 assets in the Archstone Acquisition for which outstanding third parties retained an indirect interest with associated tax protection rights which may be triggered if we sell the assets or repay secured financing thereon; if triggered upon a sale of all 16 assets, the associated tax protection payments are estimated to be approximately $44 million at December 31, 2013.

        Acquisition Strategy.    Our core competencies in development and redevelopment discussed above allow us to be selective in the acquisitions we target. Acquisitions allow us to achieve rapid penetration into markets in which we desire an increased presence. Acquisitions (and dispositions) also help us achieve our desired product mix or rebalance our portfolio. Portfolio growth also allows for fixed general and administrative costs to be a smaller percentage of overall community Net Operating Income ("NOI"). We are not presently pursuing the formation of a new discretionary real estate investment fund, preferring at this time to maintain flexibility in shaping our portfolio of wholly-owned assets through acquisitions and dispositions.

        Property Management Strategy.    We seek to increase operating income through innovative, proactive property management that will result in higher revenue from communities while constraining operating expenses. Our principal strategies to maximize revenue include:

    focusing on resident satisfaction;

    staggering lease terms such that lease expirations are better matched to traffic patterns;


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    balancing high occupancy with premium pricing, and increasing rents as market conditions permit; and

    employing revenue management software to optimize the pricing and term of leases.

        Constraining growth in operating expenses is another way in which we seek to increase earnings growth. Growth in our portfolio and the resulting increase in revenue allows for fixed operating costs to be spread over a larger volume of revenue, thereby increasing operating margins. We constrain growth in operating expenses in a variety of ways, which include, but are not limited to, the following:

    we use purchase order controls, acquiring goods and services from pre-approved vendors;

    we use national negotiated contracts and also purchase supplies in bulk where possible;

    we bid third-party contracts on a volume basis;

    we strive to retain residents through high levels of service in order to eliminate the cost of preparing an apartment home for a new resident and to reduce marketing and vacant apartment utility costs;

    we perform turnover work in-house or hire third parties, generally depending upon the least costly alternative;

    we undertake preventive maintenance regularly to maximize resident satisfaction and property and equipment life; and

    we aggressively pursue real estate tax appeals.

        On-site property management teams receive bonuses based largely upon the NOI produced at their respective communities. We use and continuously seek ways to improve technology applications to help manage our communities, believing that the accurate collection of financial and resident data will enable us to maximize revenue and control costs through careful leasing decisions, maintenance decisions and financial management.

        We generally manage the operation and leasing activity of our communities directly (although we may use a wholly-owned subsidiary) both for ourselves and the joint ventures and partnerships of which we are a member or a partner.

        From time to time we also pursue or arrange ancillary services for our residents to provide additional revenue sources or increase resident satisfaction. As a REIT, we generally cannot provide direct services to our residents that are not customarily provided by a landlord, nor can we directly share in the income of a third party that provides such services. However, we can provide such non-customary services to residents or share in the revenue from such services if we do so through a "taxable REIT subsidiary," which is a subsidiary that is treated as a "C corporation" subject to federal income taxes.

        Financing Strategy.    We maintain a capital structure that provides financial flexibility to ensure we can select cost effective capital market options that are well matched to our business risks. We estimate that our short-term liquidity needs will be met from cash on hand, borrowings under our $1,300,000,000 revolving variable rate unsecured credit facility (the "Credit Facility"), sales of current operating communities and/or issuance of additional debt or equity securities. A determination to engage in an equity or debt offering depends on a variety of factors such as general market and economic conditions, our short and long-term liquidity needs, the relative costs of debt and equity capital and growth opportunities. A summary of debt and equity activity for the last three years is reflected on our Consolidated Statement of Cash Flows of the Consolidated Financial Statements set forth in Item 8 of this report.


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        We have entered into, and may continue in the future to enter into, joint ventures (including limited liability companies or partnerships) through which we would own an indirect economic interest of less than 100% of the community or communities owned directly by such joint ventures. Our decision to either hold an apartment community in fee simple or to have an indirect interest in the community through a joint venture is based on a variety of factors and considerations, including: (i) the economic and tax terms required by a seller of land or of a community; (ii) our desire to diversify our portfolio of communities by market, submarket and product type; (iii) our desire at times to preserve our capital resources to maintain liquidity or balance sheet strength; and (iv) our projection, in some circumstances, that we will achieve higher returns on our invested capital or reduce our risk if a joint venture vehicle is used. Investments in joint ventures are not limited to a specified percentage of our assets. Each joint venture agreement is individually negotiated, and our ability to operate and/or dispose of a community in our sole discretion may be limited to varying degrees depending on the terms of the joint venture agreement.

        In addition, from time to time, we may offer shares of our equity securities, debt securities or options to purchase stock in exchange for property. We may also acquire properties in exchange for properties we currently own.

        Other Strategies and Activities.    While we emphasize equity real estate investments in rental apartment communities, we have the ability to invest in other types of real estate, mortgages (including participating or convertible mortgages), securities of other REITs or real estate operating companies, or securities of technology companies that relate to our real estate operations or of companies that provide services to us or our residents, in each case consistent with our qualification as a REIT. In addition, we own and lease retail space at our communities when either (i) the highest and best use of the space is for retail (e.g., street level in an urban area); (ii) we believe the retail space will enhance the attractiveness of the community to residents or; (iii) some component of retail space is required to obtain entitlements to build apartment homes. As of December 31, 2013, we had a total of 659,847 square feet of rentable retail space, excluding retail space within communities currently under construction. Gross rental revenue provided by leased retail space in 2013 was $15,946,000 (1.1% of total revenue). We may also develop a property in conjunction with another real estate company that will own and operate the retail component of a mixed-use building that we help develop. If we secure a development right and believe that its best use, in whole or in part, is to develop the real estate with the intent to sell rather than hold the asset, we may, through a taxable REIT subsidiary, develop real estate for sale. Any investment in securities of other entities, and any development of real estate for sale, is subject to the percentage of ownership limitations, gross income tests, and other limitations that must be observed for REIT qualification.

        We have not engaged in trading, underwriting or agency distribution or sale of securities of other issuers and do not intend to do so. At all times we intend to make investments in a manner so as to qualify as a REIT unless, because of circumstances or changes to the Internal Revenue Code of 1986 (or the Treasury Regulations), our Board of Directors determines that it is no longer in our best interest to qualify as a REIT.

Archstone Acquisition

        On February 27, 2013, pursuant to an asset purchase agreement (the "Purchase Agreement") dated November 26, 2012, by and among the Company, Equity Residential and its operating partnership, ERP Operating Limited Partnership (together, "Equity Residential"), Lehman Brothers Holdings, Inc. ("Lehman," which term is sometimes used in this report to refer to Lehman Brothers Holdings, Inc., and/or its relevant subsidiary or subsidiaries), and Archstone Enterprise LP ("Archstone," which has since changed its name to Jupiter Enterprise LP), we, together with Equity Residential, acquired, directly or indirectly, all of Archstone's assets, including all of the ownership interests in joint ventures and other entities owned by Archstone, and assumed Archstone's liabilities,


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both known and unknown, with certain limited exceptions. Under the terms of the Purchase Agreement, we acquired approximately 40% of Archstone's assets and liabilities and Equity Residential acquired approximately 60% of Archstone's assets and liabilities (the "Archstone Acquisition").

        We acquired the following as part of the Archstone Acquisition:

    54 operating apartment communities that were consolidated for financial reporting purposes, containing 18,423 apartment homes, of which four communities containing 1,368 apartment homes were subsequently disposed of during 2013;

    six communities that were under construction and/or in lease-up, of which two have been completed with 553 homes and the other four of which are expected to be completed during 2014 and contain 1,114 apartment homes;

    six parcels of land, one of which we sold to the AC JV, which is currently being developed;

    options to acquire two additional parcels of land, of which one was acquired in 2013 and will begin construction in 2014;

    interests in unconsolidated joint ventures in which we are the general partner or managing member, which joint ventures own 11 apartment communities containing 2,544 apartment homes, and an interest in an unconsolidated joint venture in which we are a limited partner, which joint venture owns one apartment community containing 305 apartment homes, as further discussed below; and

    a 40% ownership interest in unconsolidated joint venture arrangements with Equity Residential which will hold assets and liabilities that we and Equity Residential will jointly manage, and that we and Equity Residential intend to sell to or resolve with third parties, and/or subsequently transfer to Equity Residential or to us.

        The Company provided the following consideration for the Archstone Acquisition:

    the issuance of 14,889,706 shares of the Company's common stock, valued at $1,875,210,000 as of the market's close on the closing date, February 27, 2013;

    cash payment of approximately $760,000,000;

    the assumption of consolidated indebtedness with a fair value of approximately $3,732,980,000, as of February 27, 2013, consisting of $3,512,202,000 principal amount of consolidated indebtedness and $220,777,000 representing the amount by which fair value of the aforementioned debt exceeds the principal face value, $70,479,000 of which excess related to debt the Company repaid concurrent with the Archstone Acquisition;

    the acquisition with Equity Residential of interests in entities that have preferred units outstanding, some of which may be presented for redemption from time to time. The Company's 40% share of the fair value of the collective obligations, including accrued dividends on these outstanding Archstone preferred units as of February 27, 2013, was approximately $67,500,000; and

    the assumption with Equity Residential of all other liabilities, known or unknown, of Archstone, other than certain excluded liabilities. The Company shares 40% of the responsibility for these liabilities.

Tax Matters

        We filed an election with our 1994 federal income tax return to be taxed as a REIT under the Internal Revenue Code of 1986, as amended, ("the Code") and intend to maintain our qualification as a REIT in the future. As a qualified REIT, with limited exceptions, we will not be taxed under federal


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and certain state income tax laws at the corporate level on our taxable net income to the extent taxable net income is distributed to our stockholders. We expect to make sufficient distributions to avoid income tax at the corporate level. While we believe that we are organized and qualified as a REIT and we intend to operate in a manner that will allow us to continue to qualify as a REIT, there can be no assurance that we will be successful in this regard. Qualification as a REIT involves the application of highly technical and complex provisions of the Code for which there are limited judicial and administrative interpretations and involves the determination of a variety of factual matters and circumstances not entirely within our control.


        We face competition from other real estate investors, including insurance companies, pension and investment funds, partnerships and investment companies and other REITs, to acquire and develop apartment communities and acquire land for future development. As an owner and operator of apartment communities, we also face competition for prospective residents from other operators whose communities may be perceived to offer a better location or better amenities or whose rent may be perceived as a better value given the quality, location and amenities that the resident seeks. We also compete against condominiums and single-family homes that are for sale or rent. Although we often compete against large, sophisticated developers and operators for development opportunities and for prospective residents, real estate developers and operators of any size can provide effective competition for both real estate assets and potential residents.

Environmental and Related Matters

        As a current or prior owner, operator and developer of real estate, we are subject to various federal, state and local environmental laws, regulations and ordinances and also could be liable to third parties resulting from environmental contamination or noncompliance at our communities. For some development communities we undertake extensive environmental remediation to prepare the site for construction, which could be a significant portion of our total construction cost. Environmental remediation efforts could expose us to possible liabilities for accidents or improper handling of contaminated materials during construction. These and other risks related to environmental matters are described in more detail in Item 1a., "Risk Factors."

        We believe that more government regulation of energy use, along with a greater focus on environmental protection, may, over time, have a significant impact on urban growth patterns. If changes in zoning to encourage greater density and proximity to mass transit do occur, such changes could benefit multifamily housing and those companies with a competency in high-density development. However, there can be no assurance as to whether or when such changes in regulations or zoning will occur or, if they do occur, whether the multifamily industry or the Company will benefit from such changes.

Other Information

        We file annual, quarterly and current reports, proxy statements and other information with the SEC. You may read and copy any document we file at the SEC's Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. You may call the SEC at 1-202-551-8090 for further information on the operation of the Public Reference Room. Our SEC filings are also available to the public from the SEC's website at

        We maintain a website at Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports, filed or furnished pursuant to the Securities Exchange Act of 1934 are available free of charge in the "Investors" section of our website as soon as reasonably practicable after the reports are filed with or furnished to the


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SEC. In addition, the charters of our Board's Nominating and Corporate Governance Committee, Audit Committee and Compensation Committee, as well as our Director Independence Standards, Corporate Governance Guidelines, Code of Business Conduct and Ethics, Policy Regarding Shareholder Rights Agreement, Policy Regarding Shareholder Approval of Future Severance Agreements, Executive Stock Ownership Guidelines, and Policy for Recoupment of Incentive Compensation, are available free of charge in that section of our website or by writing to AvalonBay Communities, Inc., Ballston Tower, Suite 800, 671 N. Glebe Rd., Arlington, Virginia 22203, Attention: Chief Financial Officer. To the extent required by the rules of the SEC and the NYSE, we will disclose amendments and waivers relating to these documents in the same place on our website.

        We were incorporated under the laws of the State of California in 1978. In 1995, we reincorporated in the State of Maryland and have been focused on the ownership and operation of apartment communities since that time. As of January 31, 2014, we had 2,900 employees.


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        Our operations involve various risks that could have adverse consequences, including those described below. This Item 1a. includes forward-looking statements. You should refer to our discussion of the qualifications and limitations on forward-looking statements in this Form 10-K.

Development, redevelopment and construction risks could affect our profitability.

        We intend to continue to develop and redevelop apartment home communities. These activities can include long planning and entitlement timelines and can involve complex and costly activities, including significant environmental remediation or construction work in high-density urban areas. These activities may be exposed to the following risks:

    we may abandon opportunities that we have already begun to explore for a number of reasons, including changes in local market conditions or increases in construction or financing costs, and, as a result, we may fail to recover expenses already incurred in exploring those opportunities;

    occupancy rates and rents at a community may fail to meet our original expectations for a number of reasons, including changes in market and economic conditions beyond our control and the development by competitors of competing communities;

    we may be unable to obtain, or experience delays in obtaining, necessary zoning, occupancy, or other required governmental or third party permits and authorizations, which could result in increased costs or the delay or abandonment of opportunities;

    we may incur costs that exceed our original estimates due to increased material, labor or other costs;

    we may be unable to complete construction and lease-up of a community on schedule, resulting in increased construction and financing costs and a decrease in expected rental revenues;

    we may be unable to obtain financing with favorable terms, or at all, for the proposed development of a community, which may cause us to delay or abandon an opportunity;

    we may incur liabilities to third parties during the development process, for example, in connection with managing existing improvements on the site prior to tenant terminations and demolition (such as commercial space) or in connection with providing services to third parties (such as the construction of shared infrastructure or other improvements); and

    we may incur liability if our communities are not constructed and operated in compliance with the accessibility provisions of the Americans with Disabilities Acts, the Fair Housing Act or other federal, state or local requirements. Noncompliance could result in imposition of fines, an award of damages to private litigants, and a requirement that we undertake structural modifications to remedy the noncompliance.

        We estimate construction costs based on market conditions at the time we prepare our budgets, and our projections include changes that we anticipate but cannot predict with certainty. Construction costs may increase, particularly for labor and certain materials and, for some of our Development Communities and Development Rights (as defined below), the total construction costs may be higher than the original budget. Total capitalized cost includes all capitalized costs incurred and projected to be incurred to develop or redevelop a community, determined in accordance with GAAP, including:

    land and/or property acquisition costs;

    fees paid to secure air rights and/or tax abatements;

    construction or reconstruction costs;


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    costs of environmental remediation;

    real estate taxes;

    capitalized interest and insurance;

    loan fees;


    professional fees;

    allocated development or redevelopment overhead; and

    other regulatory fees.

        Costs to redevelop communities that have been acquired have, in some cases, exceeded our original estimates and similar increases in costs may be experienced in the future. We cannot assure you that market rents in effect at the time new development or redevelopment communities complete lease-up will be sufficient to fully offset the effects of any increased construction or reconstruction costs.

Unfavorable changes in market and economic conditions could adversely affect occupancy, rental rates, operating expenses, and the overall market value of our assets, including joint ventures and investments in the Funds.

        Local conditions in our markets significantly affect occupancy, rental rates and the operating performance of our communities. The risks that may adversely affect conditions in those markets include the following:

    plant closings, industry slowdowns and other factors that adversely affect the local economy;

    an oversupply of, or a reduced demand for, apartment homes;

    a decline in household formation or employment or lack of employment growth;

    the inability or unwillingness of residents to pay rent increases;

    rent control or rent stabilization laws, or other laws regulating housing, that could prevent us from raising rents to offset increases in operating costs; and

    economic conditions that could cause an increase in our operating expenses, such as increases in property taxes, utilities, compensation of on-site associates and routine maintenance.

Changes in applicable laws, or noncompliance with applicable laws, could adversely affect our operations or expose us to liability.

        We must develop, construct and operate our communities in compliance with numerous federal, state and local laws and regulations, some of which may conflict with one another or be subject to limited judicial or regulatory interpretations. These laws and regulations may include zoning laws, building codes, landlord tenant laws and other laws generally applicable to business operations. Noncompliance with laws could expose us to liability.

        Lower revenue growth or significant unanticipated expenditures may result from our need to comply with changes in (i) laws imposing remediation requirements and the potential liability for environmental conditions existing on properties or the restrictions on discharges or other conditions, (ii) rent control or rent stabilization laws or other residential landlord/tenant laws, or (iii) other governmental rules and regulations or enforcement policies affecting the development, use and operation of our communities, including changes to building codes and fire and life-safety codes.


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Short-term leases expose us to the effects of declining market rents.

        Substantially all of our apartment leases are for a term of one year or less. Because these leases generally permit the residents to leave at the end of the lease term without penalty, our rental revenues are impacted by declines in market rents more quickly than if our leases were for longer terms.

Competition could limit our ability to lease apartment homes or increase or maintain rents.

        Our apartment communities compete with other housing alternatives to attract residents, including other rental apartments, condominiums and single-family homes that are available for rent, as well as new and existing condominiums and single-family homes for sale. Competitive residential housing in a particular area could adversely affect our ability to lease apartment homes and to increase or maintain rental rates.

Attractive investment opportunities may not be available, which could adversely affect our profitability.

        We expect that other real estate investors, including insurance companies, pension funds, other REITs and other well-capitalized investors, will compete with us to acquire existing properties and to develop new properties. This competition could increase prices for properties of the type we would likely pursue and adversely affect our profitability.

Capital and credit market conditions may adversely affect our access to various sources of capital and/or the cost of capital, which could impact our business activities, dividends, earnings, and common stock price, among other things.

        In periods when the capital and credit markets experience significant volatility, the amounts, sources and cost of capital available to us may be adversely affected. We primarily use external financing to fund construction and to refinance indebtedness as it matures. If sufficient sources of external financing are not available to us on cost effective terms, we could be forced to limit our development and redevelopment activity and/or take other actions to fund our business activities and repayment of debt, such as selling assets, reducing our cash dividend or paying out less than 100% of our taxable income. To the extent that we are able and/or choose to access capital at a higher cost than we have experienced in recent years (reflected in higher interest rates for debt financing or a lower stock price for equity financing) our earnings per share and cash flows could be adversely affected. In addition, the price of our common stock may fluctuate significantly and/or decline in a high interest rate or volatile economic environment. We believe that the lenders under our Credit Facility will fulfill their lending obligations thereunder, but if economic conditions deteriorate, there can be no assurance that the ability of those lenders to fulfill their obligations would not be adversely impacted.

Insufficient cash flow could affect our debt financing and create refinancing risk.

        We are subject to the risks associated with debt financing, including the risk that our cash flow will be insufficient to meet required payments of principal and interest. In this regard, we note that in order for us to continue to qualify as a REIT, we are required to annually distribute dividends generally equal to at least 90% of our REIT taxable income, computed without regard to the dividends paid deduction and our net capital gain. This requirement limits the amount of our cash flow available to meet required principal and interest payments. The principal outstanding balance on a portion of our debt will not be fully amortized prior to its maturity. Although we may be able to repay our debt by using our cash flows, we cannot assure you that we will have sufficient cash flows available to make all required principal payments. Therefore, we may need to refinance at least a portion of our outstanding debt as it matures. There is a risk that we may not be able to refinance existing debt or that a refinancing will not be done on as favorable terms; either of these outcomes could have a material adverse effect on our financial condition and results of operations.


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Rising interest rates could increase interest costs and could affect the market price of our common stock.

        We currently have, and may in the future incur, contractual variable interest rate debt. In addition, we regularly seek access to both fixed and variable rate debt financing to repay maturing debt and to finance our development and redevelopment activity. Accordingly, if interest rates increase, our interest costs will also rise, unless we have made arrangements that hedge the risk of rising interest rates. In addition, an increase in market interest rates may lead purchasers of our common stock to demand a greater annual dividend yield, which could adversely affect the market price of our common stock.

Bond financing and zoning compliance requirements could limit our income, restrict the use of communities and cause favorable financing to become unavailable.

        We have financed some of our apartment communities with obligations issued by local government agencies because the interest paid to the holders of this debt is generally exempt from federal income taxes and, therefore, the interest rate is generally more favorable to us. These obligations are commonly referred to as "tax-exempt bonds" and generally must be secured by mortgages on our communities. As a condition to obtaining tax-exempt financing, or on occasion as a condition to obtaining favorable zoning in some jurisdictions, we will commit to make some of the apartments in a community available to households whose income does not exceed certain thresholds (e.g., 50% or 80% of area median income), or who meet other qualifying tests. As of December 31, 2013, approximately 6% of our apartment homes at current operating communities were under income limitations such as these. These commitments, which may run without expiration or may expire after a period of time (such as 15 or 20 years) may limit our ability to raise rents and, in consequence, can also adversely affect the value of the communities subject to these restrictions.

        In addition, some of our tax-exempt bond financing documents require us to obtain a guarantee from a financial institution of payment of the principal of, and interest on, the bonds. The guarantee may take the form of a letter of credit, surety bond, guarantee agreement or other additional collateral. If the financial institution defaults in its guarantee obligations, or if we are unable to renew the applicable guarantee or otherwise post satisfactory collateral, a default will occur under the applicable tax-exempt bonds and the community could be foreclosed upon if we do not redeem the bonds.

Risks related to indebtedness.

        We have a Credit Facility with Bank of America, N.A., as administrative agent, swing lender, issuing bank and a bank, JPMorgan Chase Bank, N.A., as a bank and as syndication agent, Deutsche Bank Trust Company Americas, Morgan Stanley Bank and Wells Fargo Bank, N.A., each as a bank and as documentation agent, Barclays Bank PLC as a bank and as co-documentation agent, UBS AG, Stamford Branch, as a co-documentation agent, Goldman Sachs Bank USA, The Bank of New York Mellon, Compass Bank, PNC Bank, National Association, and Suntrust Bank, each as a bank and as a managing agent, Branch Banking and Trust Company, Bank of Tokyo Mitsubishi UFJ, Ltd., and Capital One, N.A., each as a bank and as a co-agent, and the other bank parties signatory thereto. Our organizational documents do not limit the amount or percentage of indebtedness that may be incurred. Accordingly, subject to compliance with outstanding debt covenants, we could incur more debt, resulting in an increased risk of default on our obligations and an increase in debt service requirements that could adversely affect our financial condition and results of operations.

        The mortgages on those of our properties that are subject to secured debt, our Credit Facility and the indenture under which a substantial portion of our debt was issued contain customary restrictions, requirements and other limitations, as well as certain financial and operating covenants including maintenance of certain financial ratios. Maintaining compliance with these restrictions could limit our flexibility. A default in these requirements, if uncured, could result in a requirement that we repay indebtedness, which could severely affect our liquidity and increase our financing costs. Refer to


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Item 7., "Management's Discussion and Analysis of Financial Condition and Results of Operations," for further discussion.

        The mortgages on those of our properties subject to secured debt generally include provisions which stipulate a prepayment penalty or payment that we will be obligated to pay in the event that we elect to repay the mortgage note prior to the earlier of (i) the stated maturity of the note, or (ii) the date at which the mortgage note is prepayable without such penalty or payment. If we elect to repay some or all of the outstanding principal balance for our mortgage notes, we may incur prepayment penalties or payments under these provisions which could adversely affect our results of operations.

Failure to maintain our current credit ratings could adversely affect our cost of funds, related margins, liquidity and access to capital markets.

        There are two major debt rating agencies that routinely evaluate and rate our debt. Their ratings are based on a number of factors, which include their assessment of our financial strength, liquidity, capital structure, asset quality amount of real estate under development, and sustainability of cash flow and earnings, among other factors. If market conditions change, we may not be able to maintain our current credit ratings, which could adversely affect our cost of funds and related margins, liquidity, and access to capital markets.

Debt financing may not be available and equity issuances could be dilutive to our stockholders.

        Our ability to execute our business strategy depends on our access to an appropriate blend of debt and equity financing. Debt financing may not be available in sufficient amounts or on favorable terms. If we issue additional equity securities, the interests of existing stockholders could be diluted.

Failure to generate sufficient revenue or other liquidity needs could limit cash flow available for distributions to stockholders.

        A decrease in rental revenue, or liquidity needs such as the repayment of indebtedness or funding of our development activities, could have an adverse effect on our ability to pay distributions to our stockholders. Significant expenditures associated with each community such as debt service payments, if any, real estate taxes, insurance and maintenance costs are generally not reduced when circumstances cause a reduction in income from a community.

The form, timing and/or amount of dividend distributions in future periods may vary and be impacted by economic and other considerations.

        The form, timing and/or amount of dividend distributions will be declared at the discretion of the Board of Directors and will depend on actual cash from operations, our financial condition, capital requirements, the annual distribution requirements under the REIT provisions of the Code and other factors as the Board of Directors may consider relevant. The Board of Directors may modify our dividend policy from time to time.

We may choose to pay dividends in our own stock, in which case stockholders may be required to pay tax in excess of the cash they receive.

        We may distribute taxable dividends that are payable in part in our stock, as we did in the fourth quarter of 2008. Taxable stockholders receiving such dividends will be required to include the full amount of the dividend as income to the extent of our current and accumulated earnings and profits for federal income tax purposes. As a result, a U.S. stockholder may be required to pay tax with respect to such dividends in excess of the cash received. If a U.S. stockholder sells the stock it receives as a dividend in order to pay this tax, the sales proceeds may be less than the amount included in income with respect to the dividend, depending on the market price of our stock at the time of the


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sale. Furthermore, with respect to non-U.S. stockholders, we may be required to withhold U.S. tax with respect to such dividends, including in respect of all or a portion of such dividend that is payable in stock. In addition, the trading price of our stock would experience downward pressure if a significant number of our stockholders sell shares of our stock in order to pay taxes owed on dividends.

Difficulty of selling apartment communities could limit liquidity and financial flexibility.

        Federal tax laws may limit our ability to earn a gain on the sale of a community (unless we own it through a subsidiary which will incur a taxable gain upon sale) if we are found to have held, acquired or developed the community primarily with the intent to resell the community, and this limitation may affect our ability to sell communities without adversely affecting returns to our stockholders. In addition, real estate in our markets can at times be difficult to sell quickly at prices we find acceptable. These potential difficulties in selling real estate in our markets may limit our ability to change or reduce the apartment communities in our portfolio promptly in response to changes in economic or other conditions.

Acquisitions may not yield anticipated results.

        Our business strategy includes acquiring as well as developing communities. Our acquisition activities and their success may be exposed to the following risks:

    an acquired property may fail to perform as we expected in analyzing our investment; and

    our estimate of the costs of repositioning or redeveloping an acquired property may prove inaccurate.

Failure to succeed in new markets, or with new brands and community formats, or in activities other than the development, ownership and operation of residential rental communities may have adverse consequences.

        We may from time to time commence development activity or make acquisitions outside of our existing market areas if appropriate opportunities arise. Our historical experience in our existing markets in developing, owning and operating rental communities does not ensure that we will be able to operate successfully in new markets, should we choose to enter them. We may be exposed to a variety of risks if we choose to enter new markets, including an inability to accurately evaluate local apartment market conditions; an inability to obtain land for development or to identify appropriate acquisition opportunities; an inability to hire and retain key personnel; and lack of familiarity with local governmental and permitting procedures.

        Although we are primarily in the multifamily business, we also own and lease ancillary retail space when a retail component represents the best use of the space, as is often the case with large urban in-fill developments. We also may engage or have an interest in for-sale activity. We may be unsuccessful in owning and leasing retail space at our communities or in developing real estate with the intent to sell, which could have an adverse effect on our results of operations.

        We are currently implementing two new brands of communities that target various customer preferences. We cannot assure that these brands will be successful or that our costs in developing and implementing these brands will result in incremental revenue and earnings.

Land we hold with no current intent to develop may be subject to future impairment charges.

        We own parcels of land that we do not currently intend to develop. As discussed in Item 2., "Communities—Other Land and Real Estate Assets," in the event that the fair market value of a parcel changes such that we determine that the carrying basis of the parcel reflected in our financial statements is greater than the parcel's then current fair value, less costs to dispose, we would be subject to an impairment charge, which would reduce our net income.


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Risks involved in real estate activity through joint ventures.

        Instead of acquiring or developing apartment communities directly, at times we invest as a partner or a co-venturer. Joint venture investments (including investments through partnerships or limited liability companies) involve risks, including the possibility that our partner might become insolvent or otherwise refuse to make capital contributions when due; that we may be responsible to our partner for indemnifiable losses; that our partner might at any time have business goals that are inconsistent with ours; and that our partner may be in a position to take action or withhold consent contrary to our instructions or requests. Frequently, we and our partner may each have the right to trigger a buy-sell arrangement, that could cause us to sell our interest, or acquire our partner's interest, at a time when we otherwise would not have initiated such a transaction.

Risks associated with an investment in and management of discretionary real estate investment funds.

        We formed Fund I and Fund II, in which we have an equity interest of 15.2% and 31.3%, and as part of the Archstone Acquisition we acquired equity interests in the U.S. Fund and the AC JV of 28.6% and 20.0%, respectively, which, through wholly-owned subsidiaries, we manage as the general partner and managing member and in which at December 31, 2013 we have an aggregate equity investment, excluding costs incurred in excess of our equity in the underlying net assets of each respective fund, of approximately $270,178,000, net of distributions to us and excluding our purchase of a mortgage note secured by a Fund I community. The investment periods for Fund I, Fund II and the U.S. Fund are over. These Funds present risks, including the following:

    our subsidiaries that are the general partners of the Funds are generally liable, under partnership law, for the debts and obligations of the respective Funds, subject to certain exculpation and indemnification rights pursuant to the terms of the partnership agreement of the Funds;

    investors in the Funds holding a majority of the partnership interests may remove us as the general partner without cause, subject to our right to receive compensation for an additional period of management fees after such removal and our right to acquire one of the properties then held by the Funds;

    while we have broad discretion to manage the Funds and make investment decisions on behalf of the Funds, the investors or an advisory committee comprised of representatives of the investors must approve certain matters, and as a result we may be unable to cause the Funds to implement certain decisions that we consider beneficial; and

    we may be liable and/or our status as a REIT may be jeopardized if either the Funds, or the REIT entities associated with the Funds and/or the U.S. Fund and/or AC JV, fail to comply with various tax or other regulatory matters.

The governance provisions of our joint ventures with Equity Residential could adversely affect our flexibility in dealing with such joint venture assets and liabilities.

        In connection with the Archstone Acquisition, we created joint ventures with Equity Residential that manage certain of the acquired assets and liabilities. These structures involve participation in the ventures by Equity Residential whose interests and rights may not be the same as ours. Joint ownership of an investment in real estate involves risks not associated with direct ownership of real estate, including the risk that Equity Residential may at any time have economic or other business interests or goals which become inconsistent with our business interests or goals, including inconsistent goals relating to the sale of properties held in the joint ventures or the timing of the termination and liquidation of the joint ventures. Under the form for the joint venture arrangements, neither we nor Equity Residential expect to individually have the sole power to control the ventures, and an impasse


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could occur, which would adversely affect the applicable joint venture and decrease potential returns to us and our investors.

We rely on information technology in our operations, and any breach, interruption or security failure of that technology could have a negative impact on our business, operations and/or financial condition.

        Information security risks have generally increased in recent years due to the rise in new technologies and the increased sophistication and activities of perpetrators of cyber attacks.

        We collect and hold personally identifiable information of our residents and prospective residents in connection with our leasing and property management activities, and we collect and hold personally identifiable information of our associates in connection with their employment. In addition, we engage third party service providers that may have access to such personally identifiable information in connection with providing necessary information technology and security and other business services to us.

        We address potential breaches or disclosure of this confidential personally identifiable information by engaging reputable, recognized firms to help us design and maintain our information technology and data security systems, including testing and verification of their proper and secure operations on a periodic basis. We also maintain cyber risk insurance to cover certain risks arising out of data and network breaches.

        However, a failure in or breach of our operational or information security systems, or those of our third party service providers, as a result of cyber attacks or information security breaches could result in a wide range of potentially serious harm to our business operations and financial prospects, including (among others) disruption of our business and operations, disclosure or misuse of confidential or proprietary information (including personal information of our residents and/or associates), damage to our reputation, and/or potentially significant legal and/or financial liabilities.

Risk of earthquake damage.

        As further described in Item 2., "Communities—Insurance and Risk of Uninsured Losses," many of our West Coast communities are located in the general vicinity of active earthquake faults. We cannot assure you that an earthquake would not cause damage or losses greater than insured levels. In the event of a loss in excess of insured limits, we could lose our capital invested in the affected community, as well as anticipated future revenue from that community. We would also continue to be obligated to repay any mortgage indebtedness or other obligations related to the community. Any such loss could materially and adversely affect our business and our financial condition and results of operations.

        Insurance coverage for earthquakes can be costly due to limited industry capacity. As a result, we may experience shortages in desired coverage levels if market conditions are such that insurance is not available or the cost of insurance makes it, in management's view, economically impractical.

A significant uninsured property or liability loss could have a material adverse effect on our financial condition and results of operations.

        In addition to the earthquake insurance discussed above, we carry commercial general liability insurance, property insurance and terrorism insurance with respect to our communities on terms we consider commercially reasonable. There are, however, certain types of losses (such as losses arising from acts of war) that are not insured, in full or in part, because they are either uninsurable or the cost of insurance makes it, in management's view, economically impractical. If an uninsured property loss or a property loss in excess of insured limits were to occur, we could lose our capital invested in a community, as well as the anticipated future revenues from such community. We would also continue to


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be obligated to repay any mortgage indebtedness or other obligations related to the community. If an uninsured liability to a third party were to occur, we would incur the cost of defense and settlement with, or court ordered damages to, that third party. A significant uninsured property or liability loss could materially and adversely affect our business and our financial condition and results of operations.

We may incur costs and increased expenses to repair property damage resulting from inclement weather.

        Particularly in New England and the Metro New York/New Jersey area, we are exposed to risks associated with inclement weather, including increased costs related to winter weather, such as costs for the removal of snow and ice, repair of water and wind damage from storms, as well as from delays in construction. In addition, inclement weather could increase the need for maintenance and repair of our communities.

We may incur costs due to environmental contamination or non-compliance.

        Under various federal, state and local environmental and public health laws, regulations and ordinances, we may be required, regardless of knowledge or responsibility, to investigate and remediate the effects of hazardous or toxic substances or petroleum product releases at our properties (including in some cases natural substances such as methane and radon gas) and may be held liable under these laws or common law to a governmental entity or to third parties for property, personal injury or natural resources damages and for investigation and remediation costs incurred as a result of the contamination. These damages and costs may be substantial and may exceed any insurance coverage we have for such events. The presence of such substances, or the failure to properly remediate the contamination, may adversely affect our ability to borrow against, develop, sell or rent the affected property. In addition, some environmental laws create or allow a government agency to impose a lien on the contaminated site in favor of the government for damages and costs it incurs as a result of the contamination.

        The development, construction and operation of our communities are subject to regulations and permitting under various federal, state and local laws, regulations and ordinances, which regulate matters including wetlands protection, storm water runoff and wastewater discharge. Such laws and regulations may impose restrictions on the manner in which our communities may be developed, and noncompliance with such laws and regulations may subject us to fines and penalties. We do not currently anticipate that we will incur any material liabilities as a result of noncompliance with these laws.

        Certain federal, state and local laws, regulations and ordinances govern the removal, encapsulation or disturbance of asbestos containing materials ("ACMs") when such materials are in poor condition or in the event of renovation or demolition of a building. These laws and the common law may impose liability for release of ACMs and may allow third parties to seek recovery from owners or operators of real properties for personal injury associated with exposure to ACMs. We are not aware that any ACMs were used in the construction of the communities we developed. ACMs were, however, used in the construction of a number of the communities that we acquired. We implement an operations and maintenance program at each of the communities at which ACMs are detected. We do not currently anticipate that we will incur any material liabilities as a result of the presence of ACMs at our communities.

        We are aware that some of our communities have lead paint and have implemented an operations and maintenance program at each of those communities. We do not currently anticipate that we will incur any material liabilities as a result of the presence of lead paint at our communities.

        Environmental agencies and third parties may assert claims for remediation or personal injury based on the alleged actual or potential intrusion into buildings of chemical vapors from soils or groundwater underlying or in the vicinity of those buildings or on nearby properties. We currently do


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not anticipate that we will incur any material liabilities as a result of vapor intrusion at our communities.

        All of our stabilized operating communities, and all of the communities that we are currently developing, have been subjected to at least a Phase I or similar environmental assessment, which generally does not involve invasive techniques such as soil or ground water sampling. These assessments, together with subsurface assessments conducted on some properties, have not revealed, and we are not otherwise aware of, any environmental conditions that we believe would have a material adverse effect on our business, assets, financial condition or results of operations. In connection with our ownership, operation and development of communities, from time to time we undertake substantial remedial action in response to the presence of subsurface or other contaminants, including contaminants in soil, groundwater and soil vapor beneath or affecting our buildings. In some cases, an indemnity exists upon which we may be able to rely if environmental liability arises from the contamination or remediation costs exceed estimates. There can be no assurance, however, that all necessary remediation actions have been or will be undertaken at our properties or that we will be indemnified, in full or at all, in the event that environmental liability arises.

        Mold growth may occur when excessive moisture accumulates in buildings or on building materials, particularly if the moisture problem remains undiscovered or is not addressed over a period of time. Although the occurrence of mold at multifamily and other structures, and the need to remediate such mold, is not a new phenomenon, there has been increased awareness in recent years that certain molds may in some instances lead to adverse health effects, including allergic or other reactions. To help limit mold growth, we educate residents about the importance of adequate ventilation and request or require that they notify us when they see mold or excessive moisture. We have established procedures for promptly addressing and remediating mold or excessive moisture from apartment homes when we become aware of its presence regardless of whether we or the resident believe a health risk is presented. However, we cannot provide assurance that mold or excessive moisture will be detected and remediated in a timely manner. If a significant mold problem arises at one of our communities, we could be required to undertake a costly remediation program to contain or remove the mold from the affected community and could be exposed to other liabilities that may exceed any applicable insurance coverage.

        Additionally, we have occasionally been involved in developing, managing, leasing and operating various properties for third parties. Consequently, we may be considered to have been an operator of such properties and, therefore, potentially liable for removal or remediation costs or other potential costs which relate to the release or presence of hazardous or toxic substances or petroleum products at such properties. We are not aware of any material environmental liabilities with respect to properties managed or developed by us or our predecessors for such third parties.

        We cannot assure you that:

    the environmental assessments described above have identified all potential environmental liabilities;

    no prior owner created any material environmental condition not known to us or the consultants who prepared the assessments;

    no environmental liabilities have developed since the environmental assessments were prepared;

    the condition of land or operations in the vicinity of our communities, such as the presence of underground storage tanks, will not affect the environmental condition of our communities;

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    no environmental liabilities will arise at communities that we have sold for which we may have liability.

Our success depends on key personnel whose continued service is not guaranteed.

        Our success depends in part on our ability to attract and retain the services of executive officers and other personnel. Our executive officers make important capital allocation decisions or recommendations to our Board of Directors from among the opportunities identified by our regional offices. There is substantial competition for qualified personnel in the real estate industry, and the loss of several of our key personnel could adversely affect the Company.

Failure to qualify as a REIT would cause us to be taxed as a corporation, which would significantly reduce funds available for distribution to stockholders.

        If we fail to qualify as a REIT for federal income tax purposes, we will be subject to federal income tax on our taxable income at regular corporate rates (subject to any applicable alternative minimum tax). In addition, unless we are entitled to relief under applicable statutory provisions, we would be ineligible to make an election for treatment as a REIT for the four taxable years following the year in which we lose our qualification. The additional tax liability resulting from the failure to qualify as a REIT would significantly reduce or eliminate the amount of funds available for distribution to our stockholders. Furthermore, we would no longer be required to make distributions to our stockholders. Thus, our failure to qualify as a REIT could also impair our ability to expand our business and raise capital, and would adversely affect the value of our common stock.

        We believe that we are organized and qualified as a REIT, and we intend to operate in a manner that will allow us to continue to qualify as a REIT. However, we cannot assure you that we are qualified as a REIT, or that we will remain qualified in the future. This is because qualification as a REIT involves the application of highly technical and complex provisions of the Internal Revenue Code for which there are only limited judicial and administrative interpretations and involves the determination of a variety of factual matters and circumstances not entirely within our control. In addition, future legislation, new regulations, administrative interpretations or court decisions may significantly change the tax laws or the application of the tax laws with respect to qualification as a REIT for federal income tax purposes or the federal income tax consequences of this qualification.

        Even if we qualify as a REIT, we will be subject to certain federal, state and local taxes on our income and property and on taxable income that we do not distribute to our shareholders. Our non-U.S. assets may be subject to foreign taxes. In addition, we may hold certain assets and engage in certain activities that a REIT could not engage in directly through our taxable REIT subsidiaries. We also use taxable REIT subsidiaries to hold certain assets that we believe would be subject to the 100% prohibited transaction tax if sold at a gain outside of a taxable REIT subsidiary. Our domestic taxable REIT subsidiaries are subject to U.S. tax as regular corporations. The Archstone Acquisition increased the amount of assets held through our taxable REIT subsidiaries.

The ability of our stockholders to control our policies and effect a change of control of our company is limited by certain provisions of our charter and bylaws and by Maryland law.

        There are provisions in our charter and bylaws that may discourage a third party from making a proposal to acquire us, even if some of our stockholders might consider the proposal to be in their best interests. These provisions include the following:

        Our charter authorizes our Board of Directors to issue up to 50,000,000 shares of preferred stock without stockholder approval and to establish the preferences and rights, including voting rights, of any series of preferred stock issued. The Board of Directors may issue preferred stock without stockholder


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approval, which could allow the Board to issue one or more classes or series of preferred stock that could discourage or delay a tender offer or a change in control.

        To maintain our qualification as a REIT for federal income tax purposes, not more than 50% in value of our outstanding stock may be owned, directly or indirectly, by or for five or fewer individuals at any time during the last half of any taxable year. To maintain this qualification, and/or to address other concerns about concentrations of ownership of our stock, our charter generally prohibits ownership (directly, indirectly by virtue of the attribution provisions of the Code, or beneficially as defined in Section 13 of the Securities Exchange Act) by any single stockholder of more than 9.8% of the issued and outstanding shares of any class or series of our stock. In general, under our charter, pension plans and mutual funds may directly and beneficially own up to 15% of the outstanding shares of any class or series of stock. Under our charter, our Board of Directors may in its sole discretion waive or modify the ownership limit for one or more persons, but is not required to do so even if such waiver would not affect our qualification as a REIT. Our Board of Directors waived this ownership limit with respect to the common stock issued to Lehman in connection with the Archstone Acquisition. These ownership limits may prevent or delay a change in control and, as a result, could adversely affect our stockholders' ability to realize a premium for their shares of common stock.

        As a Maryland corporation, we are subject to the provisions of the Maryland General Corporation Law. Maryland law imposes restrictions on some business combinations and requires compliance with statutory procedures before some mergers and acquisitions may occur, which may delay or prevent offers to acquire us or increase the difficulty of completing any offers, even if they are in our stockholders' best interests. In addition, other provisions of the Maryland General Corporation Law permit the Board of Directors to make elections and to take actions without stockholder approval (such as classifying our Board such that the entire Board is not up for re-election annually) that, if made or taken, could have the effect of discouraging or delaying a change in control.


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        Our real estate investments consist primarily of current operating apartment communities, communities in various stages of development ("Development Communities") and Development Rights (as defined below). Our current operating communities are further distinguished as Established Communities, Other Stabilized Communities, Lease-Up Communities and Redevelopment Communities, and exclude communities in which we obtained an indirect interest through joint ventures we formed with Equity Residential as part of the Archstone Acquisition. While we generally establish the classification of communities on an annual basis, we may update the classification of communities during the calendar year to the extent that our plans with regard to the disposition or redevelopment of a community change during the year. The following is a description of each category:

        Current Communities are categorized as Established, Other Stabilized, Lease-Up, or Redevelopment according to the following attributes:

    Established Communities (also known as Same Store Communities) are 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 and operating expenses as of the beginning of the prior year. For the year ended December 31, 2013, the Established Communities are communities that are consolidated for financial reporting purposes, had stabilized occupancy and operating expenses as of January 1, 2012, are not conducting or planning to conduct substantial redevelopment activities and are not held for sale or planned for disposition within the current year. A community is considered to have stabilized occupancy at the earlier of (i) attainment of 95% physical occupancy or (ii) the one-year anniversary of completion of development or redevelopment.

    Other Stabilized Communities includes all other completed communities that we own or have a direct or indirect ownership interest in, and that have stabilized occupancy, as defined above. Other Stabilized Communities do not include communities that are conducting or planning to conduct substantial redevelopment activities within the current year.

    Lease-Up Communities are communities where construction has been complete for less than one year and where physical occupancy has not reached 95%.

    Redevelopment Communities are communities where substantial redevelopment is in progress or is planned to begin during the current year. Redevelopment is considered substantial when 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 is expected to have a material impact on the operations of the community, including occupancy levels, and future rental rates.

        Development Communities are communities that are under construction and for which a final certificate of occupancy has not been received. These communities may be partially complete and operating.

        Development Rights are development opportunities in the early phase of the development process for which we either have an option to acquire land or enter into a leasehold interest, for which we are the buyer under a long-term conditional contract to purchase land or where we control the land through a ground lease or own land to develop a new community. We capitalize related pre-development costs incurred in pursuit of new developments for which we currently believe future development is probable.


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        We currently lease our corporate headquarters located in Arlington, Virginia under an operating lease. The lease term ends in 2020, subject to two five year renewal options. All other regional and administrative offices are leased under operating leases.

        As of December 31, 2013, communities that we owned or held a direct or indirect interest in were classified as follows.

  Number of
  Number of
apartment homes

Current Communities


Established Communities:


New England

    29     7,222  

Metro NY/NJ

    25     8,416  


    11     4,443  

Pacific Northwest

    10     2,387  

Northern California

    18     5,224  

Southern California

    22     5,827  

Total Established

    115     33,519  

Other Stabilized Communities:


New England

    17     3,749  

Metro NY/NJ

    19     5,876  


    25     8,206  

Pacific Northwest

    5     1,142  

Northern California

    17     5,502  

Southern California

    33     10,562  


    3     1,030  

Total Other Stabilized

    119     36,067  

Lease-Up Communities

    7     2,099  

Redevelopment Communities

    3     1,126  

Total Current Communities

    244     72,811  

Development Communities

    29     8,708  

Development Rights

    46     12,986  

        Our holdings under each of the above categories are discussed on the following pages.

        We generally establish the composition of our Established Communities portfolio annually. For the years ended December 31, 2013, 2012 and 2011, there were 19, 11 and 14 communities added to the Established Communities portfolio, respectively, and 7, 17 and 7 communities removed, respectively. We anticipate updating the composition of our Established Communities portfolio as of both January 1, 2014 and April 1, 2014. The expected April 1, 2014 update is primarily to incorporate the stabilized apartment communities acquired in February 2013 as part of the Archstone acquisition, although we will also add previously existing assets that we owned that qualify for inclusion in our Established Communities portfolio as of April 1, 2014.

Current Communities

        Our Current Communities include garden-style apartment communities consisting of multi-story buildings in landscaped settings, as well as mid and high rise apartment communities in urban settings. As of January 31, 2014, our current communities consisted of 145 garden-style (of which 16 are mixed communities and/or include town homes), 22 high-rise and 77 mid-rise apartment communities.


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        Our communities generally offer a variety of quality amenities and features, which may include:

    fully-equipped kitchens;

    lofts and vaulted ceilings;

    walk-in closets;


    patios/decks; and

    modern appliances.

        Other features at various communities may include:

    swimming pools;

    fitness centers;

    tennis courts; and

    wi-fi lounges.

        As described in Item 1, we operate under three core brands Avalon, AVA, and Eaves by Avalon. Our core "Avalon" brand focuses on upscale apartment living and high end amenities and services. "AVA" targets customers in high energy, transit-served urban neighborhoods and generally feature smaller apartments, many of which are designed for roommate living with an emphasis on modern design and a technology focus. "Eaves by Avalon" is targeted to the cost conscious, "value" segment in suburban areas. We believe that these brands allow us to further penetrate our existing markets by targeting our market by consumer preference and attitude as well as by location and price.

        We also have an extensive and ongoing maintenance program to continually maintain and enhance our communities and apartment homes. The aesthetic appeal of our communities and a service-oriented property management team, focused on the specific needs of residents, enhances market appeal to discriminating residents. We believe our mission of Enhancing the Lives of our Residents helps us achieve higher rental rates and occupancy levels while minimizing resident turnover and operating expenses.


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        Our Current Communities are located in the following geographic markets:

  Number of
communities at
  Number of
apartment homes at
  Percentage of total
apartment homes at
  1-31-13   1-31-14   1-31-13   1-31-14   1-31-13   1-31-14  

New England

    42     49     9,652     11,868     18.4 %   16.3 %

Boston, MA

    29     34     6,792     8,518     12.9 %   11.7 %

Fairfield County, CT

    13     15     2,860     3,350     5.5 %   4.6 %

Metro NY/NJ

    38     45     12,698     14,676     24.2 %   20.2 %

Long Island, NY

    8     10     2,281     2,881     4.4 %   4.0 %

Northern New Jersey

    7     9     2,048     2,414     3.9 %   3.3 %

Central New Jersey

    8     9     3,258     3,642     6.2 %   5.0 %

New York, NY

    6     10     2,196     3,581     4.2 %   4.9 %

New York Suburban

    9     7     2,915     2,158     5.6 %   3.0 %


    21     37     8,493     13,118     16.2 %   18.0 %

Washington Metro

    21     37     8,493     13,118     16.2 %   18.0 %

Pacific Northwest

    12     16     2,810     3,794     5.4 %   5.2 %

Seattle, WA

    12     16     2,810     3,794     5.4 %   5.2 %

Northern California

    28     37     8,338     11,104     15.9 %   15.3 %

Oakland-East Bay, CA

    8     10     2,573     3,244     4.9 %   4.5 %

San Francisco, CA

    11     14     2,535     3,207     4.8 %   4.4 %

San Jose, CA

    9     13     3,230     4,653     6.2 %   6.4 %

Southern California

    37     57     10,436     17,221     19.9 %   23.7 %

Los Angeles, CA

    18     34     4,636     10,344     8.8 %   14.2 %

Orange County, CA

    11     13     3,017     3,745     5.8 %   5.1 %

San Diego, CA

    8     10     2,783     3,132     5.3 %   4.3 %


    —     3     —     1,030     0.0 %   1.4 %

    178     244     52,427     72,811     100.0 %   100.0 %

        We manage and operate substantially all of our Current Communities. During the year ended December 31, 2013, we completed construction of 4,907 apartment homes in 12 communities, and sold 4,907 apartment homes in 16 communities. The average age of our Current Communities, on a weighted average basis according to number of apartment homes, is 19.6 years. When adjusted to reflect redevelopment activity, as if redevelopment were a new construction completion date, the weighted average age of our Current Communities is 13.5 years.

        Of the Current Communities, as of January 31, 2014, we owned (directly or through wholly-owned subsidiaries):

    a full fee simple, or absolute, ownership interest in 211 operating communities, 11 of which are on land subject to land leases expiring in October 2026, November 2028, May 2041, December 2061, September 2065, November 2067, April 2095, May 2105, September 2105, April 2106, and March 2142;

    a general partnership interest and an indirect limited partnership interest in Fund I, Fund II, the U.S. Fund and the AC JV. Subsidiaries of Fund I own a fee simple interest in four operating communities, subsidiaries of Fund II own a fee simple interest in 12 operating communities, subsidiaries of the U.S. Fund own a fee simple interest in nine operating communities, and subsidiaries of the AC JV own a fee simple interest in two operating communities and one development community;

    a general partnership interest in one partnership structured as a "DownREIT," as described more fully below, that owns one community; and


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    a membership interest in five limited liability companies, that each hold a fee simple interest in an operating community.

        For some communities, a land lease is used to support tax advantaged structures that ultimately allow us to purchase the land upon lease expiration. We have options to purchase the underlying land for certain of the land leases for which we have an absolute ownership interest that expire in October 2026, November 2028 and April 2095.

        We also hold, directly or through wholly-owned subsidiaries, the full fee simple ownership interest in 26 of the 29 Development Communities and a leasehold interest in three of the Development Communities with the land leases expiring in July 2046, December 2086, and November 2106. Two of the three land leases (those expiring in 2046 and 2086) provide options for the Company to purchase the land at some point during the lease term.

        In our partnership structured as a DownREIT, one of our wholly-owned subsidiaries is the general partner, and there are limited partners whose interest in the partnership is represented by units of limited partnership interest. Limited partners are entitled to receive an initial distribution before any distribution is made to the general partner. Under the partnership agreement for the DownREIT, the distributions per unit paid to the holders of units of limited partnership interests are equal to our current common stock dividend amount. The holders of units of limited partnership interest have the right to present all or some of their units for redemption for a cash amount as determined by the partnership agreement and based on the fair value of our common stock. In lieu of a cash redemption by the partnership, we may elect to acquire any unit presented for redemption for one share of our common stock or for such cash amount. As of January 31, 2014, there were 7,500 DownREIT partnership units outstanding. The DownREIT partnership is consolidated for financial reporting purposes.


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Profile of Current, Development and Unconsolidated Communities(1)(14)

rentable area
(Sq. Ft.)
Year of
(Sq. Ft.)
Average economic occupancy
Average rental rate
City and state
of homes
$ per
$ per
Sq. Ft.





Boston, MA


Avalon at Lexington

  Lexington, MA     198     230,926     1994     1,166     92.9 %   95.1 %   96.1% (2)   2,152     1.76     23,805  

Avalon Oaks

  Wilmington, MA     204     229,752     1999     1,126     81.4 %   95.9 %   96.5 %   1,451     1.24     22,675  

Eaves Quincy

  Quincy, MA     245     224,538     1986/1996     916     90.6 %   96.5 %   96.8 %   1,605     1.69     25,478  

Avalon Essex

  Peabody, MA     154     198,478     2000     1,289     90.3 %   96.3 %   97.0 %   1,846     1.38     23,175  

Avalon Oaks West

  Wilmington, MA     120     133,376     2002     1,111     95.0 %   96.1 %   96.3 %   1,588     1.37     17,360  

Avalon Orchards

  Marlborough, MA     156     175,399     2002     1,124     94.9 %   96.6 %   97.1 %   1,679     1.44     22,772  

Avalon at Newton Highlands(11)

  Newton, MA     294     341,717     2003     1,162     92.2 %   96.2 %   94.7 %   2,501     2.07     59,899  

Avalon at The Pinehills

  Plymouth, MA     192     151,712     2004/2011     790     95.0 %   97.0 %   96.0 %   1,966     2.41     37,413  

Eaves Peabody

  Peabody, MA     286     250,624     2004     876     91.3 %   96.0 %   96.3 %   1,490     1.63     35,433  

Avalon at Bedford Center

  Bedford, MA     139     159,912     2005     1,150     96.4 %   96.4 %   95.5 %   2,035     1.70     25,040  

Avalon Chestnut Hill

  Chestnut Hill, MA     204     270,956     2007     1,328     93.1 %   96.6 %   94.9 %   2,827     2.06     61,760  

Avalon Shrewsbury

  Shrewsbury, MA     251     272,880     2007     1,087     90.8 %   96.1 %   95.8 %   1,576     1.39     36,304  

Avalon Danvers

  Danvers, MA     433     492,345     2006     1,137     93.3 %   96.8 %   95.5 %   1,691     1.44     84,639  

Avalon at Lexington Hills

  Lexington, MA     387     484,560     2007     1,252     93.5 %   95.8 %   96.0 %   2,336     1.79     88,237  

Avalon Acton

  Acton, MA     380     375,119     2007     987     88.9 %   96.7 %   96.7 %   1,581     1.55     63,185  

Avalon Sharon

  Sharon, MA     156     175,389     2007     1,124     92.3 %   97.3 %   96.4 %   1,826     1.58     30,457  

Avalon at Center Place(13)

  Providence, RI     225     222,835     1991/1997     990     88.9 %   96.1 %   96.1% (2)   2,523     2.45     37,046  

Avalon at Hingham Shipyard

  Hingham, MA     235     290,790     2009     1,237     89.4 %   95.3 %   94.4 %   2,425     1.87     53,940  

Avalon Northborough

  Northborough, MA     382     182,757     2009/2010     478     91.4 %   94.5 %   96.3 %   1,784     3.52     60,614  

Avalon Blue Hills

  Randolph, MA     276     269,675     2009     977     96.4 %   94.7 %   96.2 %   1,534     1.49     45,908  

Avalon Cohasset

  Cohasset, MA     220     293,272     2012     1,333     89.5 %   94.2 %   70.8% (3)   1,999     1.41     54,980  

Avalon Andover

  Andover, MA     115     132,918     2012     1,156     90.4 %   94.4 %   63.1% (3)   1,868     1.52     26,059  

Eaves Burlington

  Burlington, MA     203     198,193     1988/2012     976     92.1 %   96.1 %   96.1% (3)   1,576     1.55     40,321  

Avalon at Prudential Center III

  Boston, MA     271     246,935     1968/1998     911     87.8 %   96.1 %(2)   95.2% (2)   3,311     3.49 (2)   75,447  

Avalon at Prudential Center II

  Boston, MA     266     243,315     1968/1998     915     88.7 %   96.1 %(2)   95.2% (2)   3,357     3.53 (2)   62,085  

Avalon at Prudential Center I

  Boston, MA     243     242,410     1968/1998     998     94.7 %   96.1 %(2)   94.9% (2)   3,452     3.33 (2)   56,613  

Avalon Burlington

  Boston, MA     312     315,575     2013     1,011     86.9 %   96.1 %(3)   N/A     1,812     1.72 (3)   79,850  

Avalon Bear Hill

  Waltham, MA     324     391,394     1999/2013     1,208     93.5 %   96.1 %(3)   N/A     2,570     2.04 (3)   129,044  

Eaves North Quincy

  Quincy, MA     224     157,908     1977/2013     705     94.6 %   96.1 %(3)   N/A     1,747     2.38 (3)   53,572  

Avalon Natick

  Natick, MA     407     362,744     2011     891     95.1 %   96.1 %(3)   N/A     2,992     3.23 (3)   79,124  

Fairfield-New Haven, CT




Eaves Trumbull

  Trumbull, CT     340     379,242     1997     1,115     91.2 %   96.0 %   96.0 %   1,755     1.51     38,542  

Eaves Stamford

  Stamford, CT     238     222,165     1991     933     89.5 %   96.1 %(2)   96.2 %   2,063     2.12 (2)   41,315  

Avalon Wilton I

  Wilton, CT     102     158,259     1997     1,552     87.3 %   95.5 %   94.9% (2)   3,281     2.02     22,543  

Avalon Valley

  Danbury, CT     268     299,923     1999     1,119     92.2 %   95.7 %   96.1 %   1,702     1.45     26,701  

Avalon on Stamford Harbor

  Stamford, CT     323     322,461     2003     998     90.7 %   95.7 %   95.5 %   2,507     2.40     63,739  

Avalon New Canaan(12)

  New Canaan, CT     104     132,080     2002     1,270     94.2 %   93.7 %   94.5 %   3,276     2.42     24,854  

Avalon at Greyrock Place

  Stamford, CT     306     315,380     2002     1,031     92.5 %   95.5 %   96.3 %   2,300     2.13     72,267  

Avalon Danbury

  Danbury, CT     234     235,320     2005     1,006     92.7 %   95.9 %   96.1 %   1,702     1.62     36,124  

Avalon Darien

  Darien, CT     189     242,675     2004     1,284     89.4 %   95.8 %   95.8 %   2,855     2.13     42,995  

Avalon Milford I

  Milford, CT     246     217,077     2004     882     93.9 %   96.0 %   95.7 %   1,595     1.74     32,022  

Avalon Huntington

  Shelton, CT     99     139,869     2008     1,413     91.9 %   97.3 %   96.0 %   2,283     1.57     25,406  

Avalon Norwalk

  Norwalk, CT     311     310,629     2011     999     91.6 %   96.7 %   95.6 %   2,079     2.01     74,254  

Avalon Wilton II

  Wilton, CT     100     128,716     2011     1,287     94.0 %   95.6 %   93.1 %   2,408     1.79     30,376  

Avalon Shelton

  Shelton, CT     250     249,190     2013     997     88.8 %   41.8 %(3)   N/A     3,789     1.59 (3)   48,185  

Avalon East Norwalk

  Norwalk, CT     240     223,698     2013     932     87.9 %   32.8 %(3)   N/A     3,423     1.20 (3)   46,089  


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Profile of Current, Development and Unconsolidated Communities(1)(14)

rentable area
(Sq. Ft.)
Year of
(Sq. Ft.)
Average economic occupancy
Average rental rate
City and state
of homes
$ per
$ per
Sq. Ft.



Long Island, NY


Avalon Commons

  Smithtown, NY     312     377,240     1997     1,209     96.2 %   96.6 %   97.3 %   2,389     1.91     38,625  

Avalon Towers

  Long Beach, NY     109     124,611     1990/1995     1,143     90.8 %   95.7 %   96.4 %   3,543     2.96     21,705  

Avalon Court

  Melville, NY     494     596,874     1997/2000     1,208     94.3 %   96.2 %   96.2 %   2,725     2.17     61,981  

Avalon at Glen Cove(13)

  Glen Cove, NY     256     261,425     2004     1,021     95.3 %   96.9 %   96.6 %   2,582     2.45     68,833  

Avalon Pines

  Coram, NY     450     545,989     2005/2006     1,213     94.2 %   96.8 %   96.0 %   2,130     1.70     71,982  

Avalon at Glen Cove North(13)

  Glen Cove, NY     111     100,754     2007     908     91.0 %   96.5 %   97.0 %   2,494     2.65     40,080  

Avalon Charles Pond

  Coram, NY     200     208,532     2009     1,043     94.5 %   96.6 %   95.8 %   1,898     1.76     48,383  

Avalon Rockville Centre

  Rockville Centre, NY     349     349,048     2012     1,000     91.7 %   96.7 %   81.2% (3)   2,884     2.79     110,834  

Avalon Garden City

  Garden City, NY     204     288,443     2012     1,414     93.6 %   95.4 %(3)   28.8% (3)   3,541     2.39 (3)   67,483  

Avalon Westbury

  Westbury, NY     396     401,496     2006/2013     1,014     94.4 %   96.6 %(3)   N/A (3)   2,631     2.51 (3)   119,210  

Northern New Jersey




Avalon Cove

  Jersey City, NJ     504     574,339     1997     1,140     92.9 %   96.1 %   96.0% (2)   3,246     2.74     111,502  

Avalon at Edgewater

  Edgewater, NJ     408     428,792     2002     1,051     91.7 %   96.5 %   96.7 %   2,627     2.41     78,768  

Avalon at Florham Park

  Florham Park, NJ     270     330,410     2001     1,224     91.1 %   96.7 %   96.7 %   2,853     2.25     43,460  

Avalon Lyndhurst

  Lyndhurst, NJ     328     330,408     2006     1,007     92.4 %   96.2 %   96.1 %   2,224     2.12     79,022  

Avalon North Bergen

  North Bergen, NJ     164     146,170     2012     891     95.7 %   97.0 %   62.7% (3)   2,036     2.22     40,172  

Avalon at Wesmont Station

  Wood-Ridge, NJ     266     242,637     2012     912     93.2 %   95.9 %   48.4% (3)   1,997     2.10     57,459  

Avalon at Wesmont Station II

  Wood-Ridge, NJ     140     146,799     2013     1,049     97.9 %   65.8 %(3)   N/A     2,998     1.88 (3)   22,811  

Avalon Hackensack(13)

  Hackensack, NJ     226     228,184     2013     1,010     97.8 %   49.3 %(3)   N/A     3,202     1.56 (3)   44,270  

Central New Jersey




Avalon Run(10)

  Lawrenceville, NJ     632     707,592     1994/1996     1,120     91.9 %   96.1 %   96.1 %   1,565     1.34     77,630  

Avalon Princeton Junction

  West Windsor, NJ     512     486,069     1988     949     92.6 %   96.7 %   96.6 %   1,658     1.69     48,584  

Avalon at Freehold

  Freehold, NJ     296     317,356     2002     1,072     90.2 %   96.7 %   97.5 %   1,918     1.73     35,295  

Avalon Run East

  Lawrenceville, NJ     312     341,320     2003     1,094     91.0 %   96.5 %   96.6 %   1,914     1.69     52,734  

Avalon at Tinton Falls

  Tinton Falls, NJ     216     237,747     2007     1,101     94.9 %   96.4 %   96.8 %   1,911     1.67     41,161  

Avalon West Long Branch

  West Long Branch, NJ     180     193,511     2011     1,075     92.2 %   96.8 %   98.0 %   1,955     1.76     25,660  

Avalon Somerset

  Somerset, NJ     384     390,365     2013     1,017     90.1 %   51.9 %(3)   6.6% (3)   1,903     0.97 (3)   75,894  

New York, NY




Avalon Riverview I(13)

  Long Island City, NY     372     332,991     2002     895     93.3 %   96.8 %   96.4 %   3,460     3.74     97,654  

Avalon Bowery Place I

  New York, NY     206     152,725     2006     741     96.6 %   96.7 %   97.0 %   5,094     6.64     95,323  

Avalon Riverview North(13)

  Long Island City, NY     602     477,665     2007     793     93.0 %   96.6 %   96.3 %   3,276     3.99     169,007  

Avalon Bowery Place II

  New York, NY     90     73,596     2007     818     95.6 %   96.5 %   96.9 %   4,682     5.53     57,689  

Avalon Morningside Park(13)

  New York, NY     295     245,320     2009     832     95.3 %   96.2 %   95.7 %   3,467     4.01     115,114  

Avalon Fort Greene

  Brooklyn, NY     631     498,651     2010     790     94.8 %   96.0 %   96.0 %   3,125     3.80     302,124  

Avalon Midtown West

  New York, NY     550     393,554     1998/2013     716     94.4 %   93.4 %(3)   N/A     4,002     5.22 (3)   346,771  

Avalon Clinton North

  New York, NY     339     181,672     2008/2013     536     91.4 %   94.6 %(3)   N/A     3,200     5.65 (3)   195,860  

Avalon Clinton South

  New York, NY     288     160,368     2007/2013     557     92.7 %   93.7 %(3)   N/A     3,248     5.47 (3)   166,439  

New York Suburban, NY




Eaves Nanuet

  Nanuet, NY     504     608,842     1998     1,208     91.9 %   96.9 %   97.2 %   2,224     1.78     57,368  

Avalon Green

  Elmsford, NY     105     113,538     1995     1,081     90.5 %   95.5 %   97.5 %   2,447     2.16     13,748  

Avalon Willow

  Mamaroneck, NY     227     216,161     2000     952     91.6 %   96.0 %   96.4 %   2,435     2.45     48,325  

The Avalon

  Bronxville, NY     110     118,952     1999     1,081     89.1 %   93.2 %(2)   96.0% (2)   4,135     3.56 (2)   39,161  

Avalon White Plains

  White Plains, NY     407     372,406     2009     915     92.6 %   96.2 %   96.5 %   2,984     3.14     152,755  

Avalon Green II

  Elmsford, NY     444     533,539     2012     1,202     90.5 %   95.9 %   55.0% (3)   2,519     2.01     104,549  


Table of Contents

Profile of Current, Development and Unconsolidated Communities(1)(14)

rentable area
(Sq. Ft.)
Year of
(Sq. Ft.)
Average economic occupancy
Average rental rate
City and state
of homes
$ per
$ per
Sq. Ft.



Baltimore, MD


Avalon at Fairway Hills(10)

  Columbia, MD     720     724,027     1987/1996     1,006     94.2 %   95.9 %(2)   95.6% (2)   1,523     1.45 (2)   58,877  

Eaves Columbia Town Center

  Columbia, MD     392     180,410     1986     460     90.9 %   96.1 %   95.8 %   1,542     3.22     55,764  

Avalon Russett

  Laurel, MD     238     274,663     1999/2013     1,154     95.0 %   95.1 %(3)   N/A     1,829     1.51 (3)   60,215  

Washington Metro




Avalon at Foxhall

  Washington, DC     308     297,875     1982     967     93.5 %   94.6 %   93.7 %   2,589     2.53     45,819  

Avalon at Gallery Place

  Washington, DC     203     184,157     2003     907     90.1 %   96.1 %   96.3 %   2,913     3.08     49,118  

Eaves Washingtonian Center I

  Gaithersburg, MD     192     191,280     1996     996     94.3 %   97.0 %   96.4 %   1,537     1.50     14,846  

Eaves Washingtonian Center II

  Gaithersburg, MD     96     99,386     1998     1,035     91.7 %   96.7 %   94.5 %   1,739     1.62     8,424  

Avalon at Grosvenor Station

  North Bethesda, MD     497     476,585     2004     959     93.8 %   95.2 %   96.2 %   1,975     1.96     83,925  

Avalon at Traville

  North Potomac, MD     520     573,717     2004     1,103     94.6 %   96.8 %   96.9 %   1,929     1.69     70,383  

Eaves Fair Lakes

  Fairfax, VA     420     355,228     1989/1996     846     93.3 %   96.4 %   96.8 %   1,552     1.77     38,532  

AVA Ballston

  Arlington, VA     344     294,271     1990     855     93.3 %   95.3 %(2)   92.8% (2)   2,207     2.46 (2)   52,585  

Eaves Fairfax City

  Fairfax, VA     141     148,282     1988/1997     1,052     95.7 %   96.1 %   95.6% (2)   1,813     1.66     16,449  

Avalon Crescent

  McLean, VA     558     613,426     1996     1,099     94.1 %   95.8 %   96.2 %   2,040     1.78     58,703  

Avalon at Arlington Square

  Arlington, VA     842     895,781     2001     1,064     94.3 %   95.4 %   95.7 %   2,121     1.90     114,830  

Avalon Park Crest

  Tysons Corner, VA     354     288,231     2010     814     94.9 %   83.7 %(3)   29.4% (3)   2,480     2.55 (3)   77,042  

Fairfax Towers

  Falls Church, VA     415     336,051     1978/2011     810     94.0 %   96.4 %   96.8 %   1,747     2.08     93,255  

AVA H Street

  Washington, DC     138     95,594     2012     693     91.3 %   72.2 %(3)   4.7% (3)   2,775     2.89 (3)   32,893  

Archstone First & M

  Washington, DC     469     410,812     2013     876     84.0 %   80.6 %(3)   N/A     2,879     2.65 (3)   200,037  

The Albemarle

  Washington, DC     228     256,610     1966/2013     1,123     95.2 %   96.9 %(3)   N/A     2,637     2.27 (3)   81,122  

Eaves Tunlaw Gardens

  Washington, DC     166     135,450     1944/2013     816     95.2 %   96.3 %(3)   N/A     1,817     2.15 (3)   41,079  

The Statesman

  Washington, DC     281     190,420     1961/2013     678     91.1 %   96.1 %(3)   N/A     1,972     2.80 (3)   76,888  

Eaves Glover Park

  Washington, DC     120     104,310     1953/2013     869     93.3 %   96.6 %(3)   N/A     2,329     2.59 (3)   37,710  

The Consulate

  Washington, DC     269     225,924     1978/2013     843     93.3 %   94.2 %(3)   N/A     2,181     2.45 (3)   84,714  

Oakwood Philadelphia(15)

  Philadelphia, PA     80     66,440     1945/2013     831     N/A     N/A (3)   N/A     N/A     2.25 (3)   36,235  

Avalon Ballston Place

  Arlington, VA     383     333,677     2001/2013     871     94.8 %   95.3 %(3)   N/A     2,591     2.83 (3)   165,782  

Eaves Tysons Corner

  Vienna, VA     217     209,940     1980/2013     967     91.7 %   96.8 %(3)   N/A     1,798     1.80 (3)   63,690  

Archstone Ballston Square

  Arlington, VA     714     626,170     1992/2013     877     93.1 %   94.8 %(3)   N/A     2,374     2.57 (3)   297,083  

Archstone Courthouse Place

  Arlington, VA     564     478,896     1999/2013     849     92.2 %   94.9 %(3)   N/A     2,440     2.73 (3)   242,381  

Avalon Reston Landing

  Reston, VA     400     398,192     2000/2013     995     93.5 %   96.5 %(3)   N/A     1,831     1.77 (3)   113,921  

Oakwood Arlington(15)

  Arlington, VA     184     154,376     1987/2013     839     N/A     N/A (3)   N/A     N/A     2.24 (3)   59,235  





Seattle, WA


Avalon Redmond Place

  Redmond, WA     222     211,450     1991/1997     952     94.1 %   95.4 %   96.2 %   1,577     1.58     32,519  

Avalon at Bear Creek

  Redmond, WA     264     288,250     1998     1,092     93.9 %   95.6 %   95.5 %   1,582     1.38     37,722  

Avalon Bellevue

  Bellevue, WA     200     165,504     2001     828     92.5 %   95.6 %   96.5 %   1,790     2.07     32,416  

Avalon RockMeadow

  Bothell, WA     206     243,958     2000     1,184     89.3 %   95.5 %   96.2 %   1,430     1.15     26,193  

Avalon ParcSquare

  Redmond, WA     124     127,251     2000     1,026     90.3 %   95.9 %   96.3 %   1,786     1.67     21,271  

Avalon Brandemoor

  Lynwood, WA     424     453,602     2001     1,070     93.4 %   95.9 %   96.1 %   1,301     1.17     46,902  

AVA Belltown

  Seattle, WA     100     82,418     2001     824     91.0 %   96.1 %   97.2 %   1,916     2.23     19,198  

Avalon Meydenbauer

  Bellevue, WA     368     331,945     2008     902     95.9 %   96.5 %   96.8 %   1,856     1.98     91,339  

Avalon Towers Bellevue(13)

  Bellevue, WA     397     331,366     2011     835     91.7 %   95.3 %   95.4 %   2,165     2.47     123,267  

AVA Queen Anne

  Seattle, WA     203     164,644     2012     811     92.1 %   95.6 %   69.0% (3)   2,011     2.37     53,785  

Avalon Brandemoor II

  Lynwood, WA     82     93,320     2011     1,138     91.5 %   96.3 %   94.0 %   1,529     1.29     13,998  

AVA Ballard

  Seattle, WA     265     190,043     2012     717     92.1 %   47.9 %(3)   N/A     2,814     1.88 (3)   63,121  

Eaves Redmond Campus

  Redmond, WA     422     429,164     1991/2013     1,017     94.1 %   94.4 %(3)   N/A     1,760     1.63 (3)   114,623  

Archstone Redmond Lakeview

  Redmond, WA     166     141,000     1987/2013     849     97.6 %   96.0 %(3)   N/A     1,478     1.67 (3)   38,460  


Table of Contents

Profile of Current, Development and Unconsolidated Communities(1)(14)

rentable area
(Sq. Ft.)
Year of
(Sq. Ft.)
Average rental rate
of homes
Average economic occupancy
$ per
$ per
Sq. Ft.
City and state



Oakland-East Bay, CA


Avalon Fremont

  Fremont, CA     308     316,052     1994     1,026     96.8 %   96.3 %   96.8 %   2,031     1.91     59,134  

Eaves Dublin

  Dublin, CA     204     179,004     1989/1997     877     95.1 %   96.4 %   95.8 %   1,836     2.02     29,575  

Eaves Pleasanton

  Pleasanton, CA     456     366,062     1988/1994     803     93.4 %   96.5 %   95.3 %   1,794     2.16     79,416  

Eaves Union City

  Union City, CA     208     150,225     1973/1996     722     93.3 %   96.4 %   97.1 %   1,516     2.02     23,866  

Eaves Fremont

  Fremont, CA     235     191,935     1985/1994     817     94.9 %   96.4 %   96.1 %   1,835     2.17     42,895  

Avalon Union City

  Union City, CA     439     429,768     2009     979     93.2 %   96.7 %   96.3 %   1,840     1.82     118,989  

Avalon Walnut Creek(13)

  Walnut Creek, CA     418     409,890     2010     981     95.2 %   95.8 %   95.8 %   2,305     2.25     146,994  

Eaves Walnut Creek

  Walnut Creek, CA     510     380,542     1987/2013     746     94.3 %   95.7 %(3)   N/A     1,614     2.07 (3)   116,914  

Avalon Walnut Ridge I

  Walnut Creek, CA     106     80,942     2000/2013     764     90.6 %   95.0 %(3)   N/A     1,952     2.43 (3)   30,530  

Avalon Walnut Ridge II

  Walnut Creek, CA     360     251,901     1989/2013     700     96.1 %   94.7 %(3)   N/A     1,698     2.30 (3)   87.425  

San Francisco, CA




Eaves Daly City

  Daly City, CA     195     141,411     1972/1997     725     95.9 %   96.0 %   97.0 %   1,939     2.57     32,508  

AVA Nob Hill

  San Francisco, CA     185     108,962     1990/1995     589     95.7 %   97.0 %   97.2 %   2,520     4.15     33,857  

Eaves San Rafael

  San Rafael, CA     254     221,780     1973/1996     873     91.7 %   97.4 %   96.4 %   1,911     2.13     46,888  

Eaves Foster City

  Foster City, CA     288     222,364     1973/1994     772     93.1 %   95.2 %   91.9 %(2)   2,073     2.56     50,505  

Avalon Pacifica

  Pacifica, CA     220     186,800     1971/1995     849     94.5 %   96.9 %   96.3 %   1,898     2.17     33,192  

Avalon Sunset Towers

  San Francisco, CA     243     171,836     1961/1996     707     95.5 %   95.2 %   96.1 %(2)   2,391     3.22     39,716  

Eaves Diamond Heights

  San Francisco, CA     154     123,047     1972/1994     799     96.1 %   96.7 %   96.1 %   2,341     2.83     29,646  

Avalon at Mission Bay North

  San Francisco, CA     250     241,788     2003     967     94.0 %   96.1 %   96.7 %   3,975     3.95     94,405  

Avalon at Mission Bay III

  San Francisco, CA     260     261,169     2009     1,004     97.3 %   96.2 %   96.3 %   3,977     3.81     147,918  

Avalon Ocean Avenue

  San Francisco, CA     173     161,083     2012     931     95.4 %   96.5 %   47.5 %(3)   3,104     3.22     58,152  

Archstone San Bruno

  San Bruno, CA     300     267,171     2004/2013     891     96.0 %   94.9 %(3)   N/A     2,400     2.56 (3)   112,220  

Archstone San Bruno II

  San Bruno, CA     185     156,583     2007/2013     846     96.2 %   95.8 %(3)   N/A     2,275     2.58 (3)   70,397  

Archstone San Bruno III

  San Bruno, CA     187     231,306     2010/2013     1,237     95.7 %   95.6 %(3)   N/A     3,222     2.49 (3)   98,567  

San Jose, CA




Avalon Campbell

  Campbell, CA     348     326,796     1995     939     95.4 %   95.2 %(2)   95.7 %(2)   2,041     2.07 (2)   72,773  

Eaves San Jose

  San Jose, CA     440     322,992     1985/1996     734     94.4 %   96.5 %(2)   93.8 %(2)   1,908     2.51 (2)   84,791  

Avalon on the Alameda

  San Jose, CA     305     299,762     1999     983     94.8 %   96.5 %   96.2 %   2,317     2.27     57,964  

Avalon Silicon Valley

  Sunnyvale, CA     710     653,929     1997/1998     921     95.9 %   96.2 %   95.2 %   2,352     2.46     124,896  

Avalon Mountain View(12)

  Mountain View, CA     248     211,552     1986     853     96.4 %   96.0 %   96.3 %   2,520     2.84     58,659  

Eaves Creekside

  Mountain View, CA     294     215,680     1962/1997     734     92.9 %   95.9 %(2)   96.5 %   1,973     2.58 (2)   44,425  

Avalon at Cahill Park

  San Jose, CA     218     218,177     2002     1,001     95.0 %   96.2 %   95.8 %   2,361     2.27     53,284  

Avalon Towers on the Peninsula

  Mountain View, CA     211     218,392     2002     1,035     97.2 %   96.0 %   95.2 %   3,333     3.09     66,654  

Avalon Willow Glen

  San Jose, CA     412     382,147     2002/2013     928     94.4 %   95.0 %(3)   N/A     2,107     2.16 (3)   131,888  

Eaves West Valley

  San Jose, CA     789     504,171     1970/2013     639     95.1 %   95.0 %(3)   N/A     1,592     2.37 (3)   211,273  

Eaves Mountain View at Middlefield

  Mountain View, CA     402     261,702     1969/2013     651     95.0 %   96.0 %(3)   N/A     2,079     3.07 (3)   137,629  

Eaves West Valley II

  San Jose, CA     84     71,136     2013     847     76.2 %   26.2 %(3)   N/A     816     0.25 (3)   17,291  


Table of Contents

Profile of Current, Development and Unconsolidated Communities(1)(14)

rentable area
(Sq. Ft.)
Year of
(Sq. Ft.)
Average rental rate
of homes
Average economic occupancy
$ per
$ per
Sq. Ft.
City and state



Orange County, CA


AVA Newport

  Costa Mesa, CA     145     122,415     1956/1996     844     86.2 %   96.0 %   94.9 %(2)   1,940     2.21     15,590  

Avalon Mission Viejo

  Mission Viejo, CA     166     124,600     1984/1996     751     93.4 %   95.9 %   96.6 %   1,337     1.71     14,260  

Eaves South Coast

  Costa Mesa, CA     258     207,672     1973/1996     805     94.6 %   95.4 %   95.7 %   1,616     1.92     33,541  

Eaves Santa Margarita

  Rancho Santa Margarita, CA     301     229,593     1990/1997     763     92.7 %   96.2 %   94.4 %(2)   1,490     1.88     31,766  

Eaves Huntington Beach

  Huntington Beach, CA     304     268,000     1971/1997     882     95.1 %   96.0 %   96.3 %   1,606     1.75     34,138  

Avalon Anaheim Stadium

  Anaheim, CA     251     302,480     2009     1,205     86.5 %   96.1 %   95.4 %   2,279     1.82     97,626  

Avalon Irvine

  Irvine, CA     279     243,157     2010     872     91.4 %   95.0 %   95.1 %   1,851     2.02     77,501  

The Springs(6)

  Corona, CA     320     241,440     1987/2006     755     93.4 %   96.6 %   96.9 %   1,099     1.41     30,047  

Eaves Lake Forest

  Lake Forest, CA     225     215,319     1975/2011     957     91.1 %   96.4 %   95.5 %   1,538     1.55     26,728  

Avalon Irvine II

  Irvine, CA     179     160,987     2012     899     87.2 %   76.1 %(3)   8.3 %(2)   1,916     1.62 (3)   45,229  

Eaves Seal Beach

  Seal Beach, CA     549     387,594     1971/2013     706     91.3 %   94.7 %(3)   N/A     1,731     2.32 (3)   151,083  

San Diego, CA




Avalon at Mission Bay

  San Diego, CA     564     402,285     1969/1997     713     94.5 %   96.5 %   96.2 %   1,514     2.05     68,132  

Eaves Mission Ridge

  San Diego, CA     200     207,700     1960/1997     1,039     91.0 %   96.3 %   95.9 %   1,753     1.63     24,825  

AVA Cortez Hill

  San Diego, CA     299     230,395     1973/1998     771     92.0 %   95.8 %   92.3 %(2)   1,729     2.15     46,367  

Avalon Fashion Valley

  San Diego, CA     161     183,802     2008     1,142     92.5 %   96.8 %   94.2 %   2,380     1.80     64,884  

Eaves San Marcos

  San Marcos, CA     184     161,352     1988/2011     877     93.5 %   96.2 %   96.6 %   2,381     1.70     16,662  

Eaves Rancho Penasquitos

  San Diego, CA     250     191,256     1986/2011     765     92.8 %   96.2 %   94.4 %   2,382     1.86     33,872  

Archstone La Jolla Colony

  San Diego, CA     180     137,036     1987/2013     761     91.1 %   97.0 %(3)   N/A     2,383     2.14 (3)   46,094  

Eaves La Mesa

  La Mesa, CA     168     139,428     1989/2013     830     93.5 %   95.8 %(3)   N/A     2,384     1.80 (3)   39,069  

Los Angeles, CA




AVA Burbank

  Burbank, CA     748     530,160     1961/1997     709     93.6 %   95.1 %(2)   97.2 %(2)   1,548     2.08 (2)   93,048  

Avalon Woodland Hills

  Woodland Hills, CA     663     594,396     1989/1997     897     93.8 %   96.7 %   96.7 %   1,702     1.84     111,131  

Eaves Warner Center

  Woodland Hills, CA     227     191,443     1979/1998     843     93.8 %   97.4 %   97.4 %   1,621     1.87     29,218  

Avalon at Glendale(13)

  Burbank, CA     223     241,714     2003     1,084     94.2 %   95.6 %   96.8 %   2,378     2.10     43,217  

Avalon Burbank

  Burbank, CA     400     360,587     1988/2002     901     93.8 %   96.3 %   96.1 %   2,281     2.44     94,643  

Avalon Camarillo

  Camarillo, CA     249     233,273     2006     937     95.6 %   96.1 %   96.3 %   1,698     1.74     48,822  

Avalon Wilshire

  Los Angeles, CA     123     125,093     2007     1,017     95.9 %   95.1 %   96.2 %   2,865     2.68     47,595  

Avalon Encino

  Los Angeles, CA     131     131,220     2008     1,002     89.3 %   97.7 %   97.4 %   2,660     2.60     62,242  

Avalon Warner Place

  Canoga Park, CA     210     186,402     2007     888     95.2 %   97.0 %   96.6 %   1,710     1.87     52,931  

Eaves Phillips Ranch

  Pomona, CA     501     498,036     1989/2011     994     94.8 %   96.6 %   96.4 %   1,507     1.46     51,595  

Eaves San Dimas

  San Dimas, CA     102     94,200     1978/2011     924     97.1 %   97.2 %   96.6 %   1,338     1.41     9,759  

Eaves San Dimas Canyon

  San Dimas, CA     156     144,669     1981/2011     927     92.9 %   97.1 %   96.6 %   1,436     1.50     15,561  

AVA Pasadena

  Pasadena, CA     84     70,648     1973/2012     841     90.5 %   87.8 %(2)   97.9 %(3)   1,837     1.92 (2)   23,534  

Eaves Cerritos

  Artesia, CA     151     106,961     1973/2012     708     95.4 %   95.2 %   93.7 %(3)   1,406     1.89     29,500  

Avalon Del Rey

  Del Rey, CA     309     283,183     2006/2012     916     93.5 %   96.8 %   97.2 %(3)   2,154     2.27     103,205  

Avalon Simi Valley

  Simi Valley, CA     500     430,218     2007/2013     860     95.0 %   96.4 %(3)   N/A     1,674     1.88 (3)   119,684  

Archstone Studio City II

  Studio City, CA     101     84,207     1991/2013     834     92.1 %   94.0 %(3)   N/A     1,937     2.18 (3)   28,523  


Table of Contents

Profile of Current, Development and Unconsolidated Communities(1)(14)

rentable area
(Sq. Ft.)
Year of
(Sq. Ft.)
Average rental rate
of homes
Average economic occupancy
$ per
$ per
Sq. Ft.
City and state

Archstone Studio City III

  Studio City, CA     276     263,512     2002/2013     955     91.7 %   94.4 %(3)   N/A     2,330     2.30 (3)   97,194  

Avalon Calabasas

  Calabasas, CA     600     506,394     1988/2013     844     92.7 %   95.5 %(3)   N/A     1,749     1.98 (3)   156,518  

Avalon Oak Creek

  Agoura Hills, CA     336     364,176     2004/2013     1,084     92.6 %   94.8 %(3)   N/A     2,281     2.00 (3)   127,587  

Avalon Santa Monica on Main

  Santa Monica, CA     133     122,502     2007/2013     921     90.2 %   93.8 %(3)   N/A     4,040     4.11 (3)   95,736  

Avalon Del Mar Station

  Pasadena, CA     347     338,466     2006/2013     975     93.7 %   94.3 %(3)   N/A     2,220     2.15 (3)   130,181  

Eaves Old Town Pasadena

  Pasadena, CA     96     66,420     1972/2013     692     94.8 %   96.4 %(3)   N/A     1,726     2.41 (3)   25,468  

Eaves Thousand Oaks

  Thousand Oaks, CA     154     134,388     1992/2013     873     93.5 %   95.7 %(3)   N/A     1,861     2.04 (3)   35,835  

Eaves Los Feliz

  Los Angeles, CA     263     201,830     1989/2013     767     92.8 %   96.0 %(3)   N/A     1,749     2.19 (3)   65,273  

Oakwood Toluca Hills(15)

  Los Angeles, CA     1,151     795,442     1973/2013     691     N/A     N/A (3)   N/A     N/A     2.07 (3)   256,316  

Eaves Woodland Hills

  Woodland Hills, CA     883     578,365     1971/2013     655     95.1 %   95.8 %(3)   N/A     1,374     2.01 (3)   166,429  

Avalon Thousand Oaks Plaza

  Thousand Oaks, CA     148     140,452     2002/2013     949     95.9 %   96.5 %(3)   N/A     1,944     1.98 (3)   37,031  

Avalon Pasadena

  Pasadena, CA     120     102,516     2004/2013     854     92.5 %   95.1 %(3)   N/A     2,343     2.61 (3)   43,325  

Archstone Studio City

  Studio City, CA     450     331,324     1987/2013     736     93.3 %   94.9 %(3)   N/A     1,801     2.32 (3)   112,222  





Archstone Lexington

  Flower Mound, TX     222     218,309     2000/2013     983     91.4 %   96.3 %(3)   N/A     1,300     1.27 (3)   32,108  

Archstone Memorial Heights

  Houston, TX     556     434,236     1996/2013     781     91.0 %   95.4 %(3)   N/A     1,397     1.71 (3)   187,351  





Avalon Exeter(13)

  Boston, MA     187     200,641     N/A     1,073     17.6 %   N/A (3)   N/A     N/A     N/A (3)   95,579  

Avalon West Chelsea/AVA High Line(13)

  New York, NY     710     226,556     N/A     319     N/A     N/A (3)   N/A     N/A     N/A (3)   228,950  

Avalon Mosaic

  Tysons Corner, VA     531     458,198     N/A     863     27.7 %   6.5 %(3)   N/A     N/A     N/A (3)   110,310  

Avalon/AVA Assembly Row(13)

  Somerville, MA     445     181,910     N/A     409     19.5 %   N/A (3)   N/A     N/A     N/A (3)   99,880  

AVA University District

  Seattle, WA     283     201,389     N/A     712     42.4 %   22.6 %(3)   N/A     N/A     N/A (3)   68,640  

Avalon Dublin Station II

  Dublin, CA     253     247,301     N/A     977     24.5 %   N/A (3)   N/A     N/A     N/A (3)   74,099  

Avalon Morrison Park

  San Jose, CA     250     277,710     N/A     1,111     22.0 %   4.0 %(3)   N/A     N/A     N/A (3)   68,443  

AVA 55 Ninth

  San Francisco, CA     273     236,907     N/A     868     4.0 %   N/A (3)   N/A     N/A     N/A (3)   100,858  

Avalon Bloomingdale

  Bloomingdale, NJ     174     176,542     N/A     1,015     71.8 %   27.2 %(3)   N/A     N/A     N/A (3)   28,831  

Avalon Wharton

  Wharton, NJ     248     246,814     N/A     995     N/A     N/A (3)   N/A     N/A     N/A (3)   20,533  

Avalon Ossining

  Ossining, NY     168     184,137     N/A     1,096     12.5 %   N/A (3)   N/A     N/A     N/A (3)   24,768  

AVA Little Tokyo

  Los Angeles, CA     280     282,917     N/A     1,010     N/A     N/A (3)   N/A     N/A     N/A (3)   62,238  

AVA Stuart Street

  Boston, MA     398     324,768     N/A     816     N/A     N/A (3)   N/A     N/A     N/A (3)   52,037  

Avalon Canton

  Canton, MA     196     235,437     N/A     1,201     6.1 %   N/A (3)   N/A     N/A     N/A (3)   20,638  

Avalon at Stratford

  Stratford, CT     130     148,720     N/A     1,144     N/A     N/A (3)   N/A     N/A     N/A (3)   13,398  

Avalon Bloomfield Station

  Bloomfield, NJ     224     211,008     N/A     942     N/A     N/A (3)   N/A     N/A     N/A (3)   12,332  

Avalon Willoughby Square/AVA DoBro

  New York, NY     826     606,284     N/A     734     N/A     N/A (3)   N/A     N/A     N/A (3)   172,272  

Avalon Huntington Station

  Huntington Station, NY     303     364,602     N/A     1,203     1.3 %   N/A (3)   N/A     N/A     N/A (3)   48,921  

Avalon Alderwood I

  Lynnwood, WA     367     352,320     N/A     960     N/A     N/A (3)   N/A     N/A     N/A (3)   31,288  

Avalon Hayes Valley

  San Francisco, CA     182     135,044     N/A     742     N/A     N/A (3)   N/A     N/A     N/A (3)   39,052  

Avalon Baker Ranch

  Lake Forest, CA     430     424,840     N/A     988     N/A     N/A (3)   N/A     N/A     N/A (3)   34,803  

Avalon Vista

  Vista, CA     221     222,768     N/A     1,008     N/A     N/A (3)   N/A     N/A     N/A (3)   15,349  

Avalon San Dimas

  San Dimas, CA     156     152,724     N/A     979     N/A     N/A (3)   N/A     N/A     N/A (3)   18,729  

Avalon Glendora

  Los Angeles, CA     256     242,176     N/A     946     N/A     N/A (3)   N/A     N/A     N/A (3)   23,052  


Table of Contents

Profile of Current, Development and Unconsolidated Communities(1)(14)

rentable area
(Sq. Ft.)
Year of
(Sq. Ft.)
Average rental rate
of homes
Average economic occupancy
$ per
$ per
Sq. Ft.
City and state

Maple Leaf(9)

  Cambridge, MA     103     46,453     N/A     451     N/A     N/A (3)   N/A     N/A     N/A (3)   N/A  

Avalon Arlington North

  Arlington, VA     228     268,618     N/A     1,178     14.5 %   N/A (3)   N/A     N/A     N/A (3)   69,524  

Avalon Berkeley

  Berkeley, CA     94     79,524     N/A     846     N/A     N/A (3)   N/A     N/A     N/A (3)   23,096  

Archstone Toscano

  Houston, TX     474     460,983     N/A     973     62.9 %   37.9 %(3)   N/A     1,336     N/A (3)   86,419  

Archstone Memorial Heights Phase I

  Houston, TX     318     305,262     N/A     960     4.7 %   N/A(3 )   N/A     N/A     N/A (3)   35,920  





Avalon at Mission Bay North II(12)

  San Francisco, CA     313     291,556     2006     931     93.9 %   96.5 %   96.3 %   3,843     3.98     N/A  

Avalon Chrystie Place I(12)

  New York, NY     361     266,940     2005     739     94.5 %   94.2 %   95.7 %   4,651     5.93     N/A  

South Hills Apartments(6)

  West Covina, CA     85     104,600     1966/2007     1,231     92.9 %   97.0 %   96.4 %   1,807     1.42     N/A  

Weymouth Place(6)

  Weymouth, MA     211     154,957     1971/2007     734     90.5 %   95.8 %   97.3 %   1,331     1.74     N/A  

Avalon at Rutherford Station(6)

  East Rutherford, NJ     108     112,709     2005/2007     1,044     92.6 %   96.2 %   95.9 %   2,383     2.20     N/A  

Avalon Fair Oaks(7)

  Fairfax, VA     491     373,843     1987/2009     761     93.7 %   96.5 %   97.0 %   1,504     1.91     N/A  

Avalon Bellevue Park(7)

  Bellevue, WA     220     165,948     1994/2009     754     95.9 %   95.8 %   95.7 %   1,516     1.92     N/A  

Eaves Tustin(7)