Essex Property Trust (ESS) Citi’s 30th Annual Global Property CEO Conference 2025 summary

Company overview and operational highlights

• Operates over 62,000 units as the only public multifamily REIT focused on the West Coast, with 31 consecutive years of dividend increases and strong total returns.

• Outperformance driven by favorable supply-demand fundamentals, disciplined capital allocation, and efficient operations.

• California markets have low new supply due to costly entitlement processes, making rent growth less dependent on job growth.

• Personal income in Northern California has grown over 20% in four years, supporting strong demand.

• 85% of AI companies are headquartered in Northern California, with announced expansions and hiring expected to boost housing demand.

Market strategy and legislative environment

• Maintains focus on core West Coast markets, citing near-term upside and comparable cap rates to other regions.

• Legislative risks are monitored; recent moderate election outcomes in California reduce concerns about extreme regulation.

• New eviction moratoriums are more targeted, requiring proof of impact and income limits, reducing risk of abuse.

• Statewide rent control (AB 1482) allows for CPI plus 5% increases, capped at 10%, aligning with long-standing internal policies.

Demand, rent growth, and operational performance

• Job openings at top tech companies in core markets have returned to pre-COVID levels, signaling renewed hiring and potential for accelerated rent growth.

• Rent and occupancy trends have exceeded expectations, with concessions dropping and new lease rates turning positive.

• Renewal rent increases are currently in the low 4% range, expected to settle in the mid- to high-3% range after negotiations.

• Will push renewals more aggressively if market rent growth reaches 4–5% during peak leasing season.