EarningsQ3 2026 Earnings Report
MX:ESS Q3 2026 EPS Results
Actual EPS$28.37
Consensus EPS$27.53
Beat/MissBeat by +$0.84
One Year Ago EPS$47.78
MX:ESS Q3 2026 Revenue Results
Actual Revenue$9.19B
Expected Revenue$9.16B
Beat/MissBeat by +$31.37M
YoY Revenue Growth+4.10%
Earnings Announcement Details
QuarterQ3 2026
Date10/27/2026
TimeAfter Close
Conference CallTuesday, October 27, 2026
MX:ESS Upcoming Earnings
Essex Property's next earnings date is estimated for February 9, 2027, based on past reporting schedules.
Q3 2026 Earnings Call Audio
MX:ESS Q3 2026 Earnings Call
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Q3 2026 Earnings Slide Deck
Q3 2026 Earnings Call Summary
Earnings Call Sentiment|Positive
The call was predominantly positive. Essex raised its full-year revenue and NOI outlook, exceeded expectations on core FFO, reported strong Northern California performance, and highlighted favorable supply, affordability, liquidity, and capital-allocation conditions. The main challenges were higher interest rates and related joint-venture interest expense, higher scheduled controllable spending, modest Los Angeles growth, macroeconomic uncertainty, and potential transaction-market weakness, but management generally characterized operating fundamentals as stable or improving.Company Guidance
Full-Year Growth Outlook Raised
Essex raised its full-year outlook for same-property revenue growth by 10 basis points to 2.9%, driven by better scheduled rent growth, and raised the midpoint of same-property NOI growth by 20 basis points to 3%. The company also achieved another increase in its full-year growth outlook for same-property revenue growth and core FFO per share.
Core FFO Beat Guidance
Third-quarter core FFO per share was $4, representing a $0.01 beat to the midpoint of the guidance range. The primary driver was better same-property revenue, which grew 3% year over year.
Northern California Continued to Lead Performance
Northern California generated 7.3% blended rent growth in the third quarter, supported by a strong leasing season with an extended peak that continued through September. Northern California was identified as the primary driver of the company's outperformance.
Seattle Returned to Positive Rent Growth
Seattle's blended rent growth turned positive in the second quarter and remained positive in the third quarter, generating 2.1% growth. The improvement was led by the Eastside, which benefited Essex's portfolio allocation in the region.
Southern California Remained Stable
Southern California operating conditions were described as stable, with Orange County and San Diego leading regional performance. Third-quarter blended rent growth was 90 basis points, in line with plan.
Strong Leasing and Renewal Trends
New lease rates in Northern California improved by 20 basis points sequentially from the second to the third quarter, an unusual result for the company's normal seasonal pattern. Fourth-quarter renewals were being offered in the mid-4% range, while asking rents were in the low to mid-5s. Companywide earn-in was expected to be approximately 150 basis points plus an additional 5 to 10 basis points, compared with about 85 basis points last year.
Favorable West Coast Supply Fundamentals
Total housing deliveries are expected to remain at a historical low of approximately 40 basis points of total housing stock. Management said supply in Essex's markets is expected to decline around 20% next year, with the forecast accounting for delays and realistic lease-up timing.
Technology and Aerospace Demand Catalysts
Management said technology-sector innovation continues to attract investment and support economic activity, while Seattle has reached its pre-COVID average in top-20 technology job openings for the first time in two years. In Southern California, aerospace and defense commitments include an estimated $1.5 trillion industry opportunity over the next 10 years, with one-third of the funding allocated to Southern California, although the timing of job growth remains uncertain.
San Francisco Affordability Supports Further Growth
San Francisco's rent-to-median-income ratio was 25.7%, up about 150 basis points from a year ago but still below the nearly 30% 20-year average and the 36% historical peak. Management said Northern California rents could increase by over 20% without wage growth to return to pre-COVID affordability levels.
Successful East Bay Acquisition
Essex closed on an off-market 474-unit community built in 2022 in the East Bay. The transaction was priced at more than $200 million and well below replacement cost, with an expected mid-5% yield. Management said nearby communities should allow operating efficiencies and improved retail leasing.
Disciplined and Flexible Capital Allocation
Essex said it has allocated capital to five of six available options in 2026, including acquisitions, development, reinvestments, stock buybacks, and debt paydown. The company intends to remain nimble and direct capital toward opportunities offering the highest risk-adjusted returns and potential to increase NAV and FFO per share.
Strong Liquidity and Manageable Maturities
Pro rata debt maturities for 2027 are approximately $575 million, including $350 million of bonds maturing in May, which management described as manageable relative to the balance sheet. Net debt to EBITDA was 5.4x, and the company had well over $1 billion of available liquidity.
Limited Floating-Rate Exposure and Hedging
Floating-rate exposure was approximately 12% on a pro rata basis, with just over 40% tied to the SIFMA Index. During 2026, Essex executed approximately $600 million of swaps at a 4.9% all-in fixed rate to replace swaps expiring over the following six months.
Development Projects Tracking Favorably
The 7 South Linden project in Northern California was tracking to plan, with underwriting yields improving alongside rent growth and delivery expected ahead of schedule. Essex was also making progress on the entitlement process for the Middlefield project in Mountain View.
Stable Concession Levels
Portfolio concessions averaged around 10 days in the third quarter versus approximately six days a year earlier and were around one week heading into the fourth quarter. Northern California had effectively no concessions, the Pacific Northwest was below one week, and Southern California was a little over one week.
MX:ESS Earnings History
The table shows recent earnings report dates and whether the forecast was beat or missed. See the change in forecast and EPS from the previous year.
Beat
Missed