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CPT Camden Property Trust

Filed: 20 Feb 20, 1:04pm

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
 
 FORM 10-K
(Mark One)
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2019
OR 
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                     to                     
Commission file number: 1-12110
 
CAMDEN PROPERTY TRUST
(Exact name of registrant as specified in its charter)
 
Texas 76-6088377
(State or other jurisdiction of
incorporation or organization)
 
(I.R.S. Employer
Identification No.)
    
11 Greenway Plaza, Suite 2400Houston,Texas 77046
(Address of principal executive offices)   (Zip Code)
Registrant’s telephone number, including area code: (713) 354-2500
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading SymbolName of each exchange on which registered
Common Shares of Beneficial Interest, $.01 par valueCPTNew 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  ¨
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  ¨    No  ý
Indicate by check mark whether 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 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  ¨
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ý    No  ¨
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 definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act (check one):
Large accelerated filer ýAccelerated filer ¨
Non-accelerated filer ¨Smaller reporting company 
   Emerging growth company 
If an emerging growth company, indicate by check mark if the registrant has elected to not use the extended transition period for complying with any new or revised financial accounting standards provided pursuant of Section 13(a) of the Exchange Act. ¨
Indicate by check mark whether the registrant is a shell company (as defined in the Rule 12b-2 of the Act).    Yes       No  ý
The aggregate market value of voting and non-voting common equity held by non-affiliates of the registrant was $10,045,538,849 based on a June 28, 2019 share price of $104.39.
On February 13, 2020, 97,326,277 common shares of the registrant were outstanding, net of treasury shares and shares held in our deferred compensation arrangements.
 
 
 
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the registrant's Proxy Statement in connection with its Annual Meeting of Shareholders to be held May 13, 2020 are incorporated by reference in Part III.

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TABLE OF CONTENTS
 


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PART I
Item 1. Business
General
Formed on May 25, 1993, Camden Property Trust, a Texas real estate investment trust (“REIT”), and all its consolidated subsidiaries are primarily engaged in the ownership, management, development, redevelopment, acquisition, and construction of multifamily apartment communities. Unless the context requires otherwise, “we,” “our,” “us,” and the “Company” refer to Camden Property Trust and its consolidated subsidiaries. Our multifamily apartment communities are referred to as “communities,” “multifamily communities,” “properties,” or “multifamily properties” in the following discussion.
Our website is located at www.camdenliving.com. We make available free of charge through our website, our annual report on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K, and amendments to such reports, filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, as soon as reasonably practicable after we electronically file such material with, or furnish it to, the U.S. Securities and Exchange Commission (the “SEC”). We also make available, free of charge on our website, our Guidelines on Governance, Code of Business Conduct and Ethics, Code of Ethical Conduct for Senior Financial Officers, and the charters of each of our Audit, Compensation, and Nominating and Corporate Governance Committees. Copies are also available, without charge, from Investor Relations, 11 Greenway Plaza, Suite 2400, Houston, Texas 77046. References to our website in this report are provided as a convenience and do not constitute, and should not be viewed as, an incorporation by reference of the information contained on, or available through our website, and therefore such information should not be considered part of this report.
Our annual, quarterly, and current reports, proxy statements, and other information are electronically filed with the SEC. The SEC maintains a website (http://www.sec.gov) that contains reports, proxy, and information statements and other information regarding issuers that file electronically with the SEC.
Narrative Description of Business
As of December 31, 2019, we owned interests in, operated, or were developing 172 multifamily properties comprised of 58,315 apartment homes across the United States. Of the 172 properties, eight properties were under construction and will consist of a total of 2,208 apartment homes when completed. We also own land holdings which we may develop into multifamily communities in the future.
Operating and Business Strategy
We believe producing consistent earnings growth through property operations, development and acquisitions, achieving market balance, and recycling capital are crucial factors to our success. We rely heavily on our sophisticated property management capabilities and innovative operating strategies to help us maximize the earnings potential of our communities.
Real Estate Investments and Market Balance. We believe we are well positioned in our current markets and have the expertise to take advantage of new opportunities as they arise. These capabilities, combined with what we believe is a conservative financial structure, should allow us to concentrate our growth efforts toward selective opportunities to enhance our strategy of having a geographically diverse portfolio of assets which meet the requirements of our residents.
We continue to operate in our core markets which we believe provides an advantage due to economies of scale. We believe, where possible, it is best to operate with a strong base of properties in order to benefit from the personnel allocation and the market strength associated with managing multiple properties in the same market. However, consistent with our goal of generating sustained earnings growth, we intend to selectively dispose of properties and redeploy capital for various strategic reasons, including if we determine a property cannot meet our long-term earnings growth expectations.
We try to maximize capital appreciation of our properties by investing in markets characterized by conditions favorable to multifamily property appreciation. These markets generally feature the following:
 
Strong economic growth leading to household formation and job growth, which in turn should support higher demand for our apartments; and
An attractive quality of life, which may lead to higher demand and retention for our apartments and allow us to more readily increase rents.
Subject to market conditions, we intend to continue to seek opportunities to develop new communities, and to redevelop, reposition and acquire existing communities. We also intend to evaluate our operating property and land development portfolio and plan to continue our practice of selective dispositions as market conditions warrant and opportunities arise.

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We expect to maintain a strong balance sheet and preserve our financial flexibility by continuing to focus on our core fundamentals which currently are generating positive cash flows from operations, maintaining appropriate debt levels and leverage ratios, and controlling overhead costs. We intend to meet our near-term liquidity requirements through a combination of one or more of the following: cash flows generated from operations, draws on our unsecured credit facility, the use of debt and equity offerings under our automatic shelf registration statement, proceeds from property dispositions, equity issued from our at-the-market ("ATM") share offering programs, other unsecured borrowings, or secured mortgages.
Sophisticated Property Management. We believe the depth of our organization enables us to deliver quality services, promote resident satisfaction, and retain residents, thereby increasing our operating revenues and reducing our operating expenses. We manage our properties utilizing a staff of professionals and support personnel, including certified property managers, experienced apartment managers and leasing agents, and trained apartment maintenance technicians. Our on-site personnel are trained to deliver high-quality services to our residents, and we strive to motivate our on-site employees through incentive compensation arrangements based upon property operational results, rental rate increases, occupancy levels, and level of new leases and lease renewals achieved.
Operations. We believe an intense focus on operations is necessary to realize consistent, sustained earnings growth. Ensuring resident satisfaction, increasing rents as market conditions allow, maximizing rent collections, maintaining property occupancy at optimal levels, and controlling operating costs comprise our principal strategies to maximize property financial results. We believe our web-based property management and revenue management systems strengthen on-site operations and allow us to quickly adjust rental rates as local market conditions change. Lease terms are generally staggered based on vacancy exposure by apartment type such that lease expirations are matched to each property's seasonal rental patterns. We generally offer leases ranging from twelve to fifteen months with individual property marketing plans structured to respond to local market conditions. In addition, we conduct ongoing customer service surveys to help ensure timely response to residents' changing needs and a high level of satisfaction.
Investments in Joint Ventures. We have entered into, and may continue in the future to enter into, joint ventures or partnerships, including limited liability companies, through which we own an indirect economic interest in less than 100% of the community or land owned by the joint venture or partnership. We account for three investment funds (collectively, the "Funds") utilizing the equity method of accounting. As of December 31, 2019, we had two discretionary investment funds, which are closed to future investments, and a third fund which we formed in March 2015 and, as amended, may be utilized for future multifamily investments of up to $360 million. See Note 8, “Investments in Joint Ventures,” and Note 14, “Commitments and Contingencies,” in the notes to the Consolidated Financial Statements for further discussion of our investments in joint ventures.
Competition
There are numerous housing alternatives which compete with our communities in attracting residents. Our properties compete directly with other multifamily properties as well as condominiums, single-family homes, third-party providers of short-term rentals and serviced apartments, which are available for rent or purchase in the markets in which our communities are located. This competitive environment could have a material adverse effect on our ability to lease apartment homes or on the rents realized at our present properties or any newly developed or acquired property.
Employees
At December 31, 2019, we had approximately 1,650 employees, including executive, administrative, and community personnel.
Qualification as a Real Estate Investment Trust
As of December 31, 2019, we met the qualification of a REIT under Sections 856-860 of the Internal Revenue Code of 1986, as amended (the “Code”). As a result, with the exception of our taxable REIT subsidiaries, we will not be subject to federal income tax to the extent we continue to meet certain requirements of the Code.
Item 1A. Risk Factors
In addition to the other information contained in this Form 10-K, the following risk factors should be considered carefully in evaluating our business. Our business, financial condition, or results of operations could be materially adversely affected by any of these risks.

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Risks Associated with Capital Markets, Credit Markets, and Real Estate
Volatility in capital and credit markets, or other unfavorable changes in economic conditions, either nationally or regionally in one or more of the markets in which we operate, could adversely impact us.
The capital and credit markets are subject to volatility and disruption. We therefore may not be able to obtain new debt financing or refinance our existing debt on favorable terms or at all, which would adversely affect our liquidity, our ability to make distributions to shareholders, acquire assets and continue our development activities. Other weakened economic conditions, including job losses, high unemployment levels, stock market volatility, and uncertainty about the future, could adversely affect rental rates and occupancy levels. Unfavorable changes in economic conditions may have a material adverse impact on our cash flows and operating results.
Additional key economic risks which may adversely affect conditions in the markets in which we operate include the following:
 
local conditions, such as an oversupply of apartments or other housing available for rent, or a reduction in demand for apartments in the area;
declines in the financial condition of our residents, which may make it more difficult for us to collect rents from some residents;
declines in market rental rates;
low mortgage interest rates and home pricing, making alternative housing more affordable;
government or builder incentives which enable home buyers to put little or no money down, making alternative housing options more attractive;
regional economic downturns, including, but not limited to, business layoffs, downsizing and increased unemployment, which may impact one or more of our geographical markets; and
increased operating costs, if these costs cannot be passed through to our residents.
Short-term leases expose us to the effects of declining market rents.
Our apartment leases are generally for a term of fifteen months or less. As these leases typically 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 apartments or increase or maintain rental income.
There are numerous housing alternatives which compete with our properties in attracting residents. Our properties compete directly with other multifamily properties, condominiums, single-family homes, third-party providers of short-term rentals and serviced apartments, which are available for rent or purchase in the markets in which our properties are located. This competitive environment could have a material adverse effect on our ability to lease apartment homes at our present properties or any newly developed or acquired property, as well as on the rents realized.
We face risks associated with land holdings and related activities.
We hold land for future development and may in the future acquire additional land holdings. The risks inherent in purchasing, owning, and developing land increase as demand for apartments, or rental rates, decrease. Real estate markets are highly uncertain and, as a result, the value of undeveloped land may fluctuate significantly. In addition, carrying costs can be significant and can result in losses or reduced profitability. As a result, we hold certain land, and may in the future acquire additional land, in our development pipeline at a cost we may not be able to fully recover or at a cost which may preclude us from developing a profitable multifamily community. If there are subsequent changes in the fair market value of our land holdings which we determine is less than the carrying basis of our land holdings reflected in our financial statements plus estimated costs to sell, we may be required to take future impairment charges which would reduce our net income.
Risks Associated with Our Operations
Development, redevelopment and construction risks could impact our profitability.
We intend to continue to develop, redevelop and construct multifamily apartment communities for our portfolio. In 2020, we expect to incur costs between approximately $220 million and $240 million related to the construction of seven consolidated projects. Additionally, during 2020, we expect to incur costs between approximately $65 million and $75 million related to the start of new development activities, between approximately $52 million and $56 million related to repositions and revenue

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enhancing expenditures of existing properties and between approximately $16 million and $20 million in extensive redevelopment expenditures of existing properties. Our development, redevelopment and construction activities may be exposed to a number of risks which may increase our construction costs and decrease our profitability, including the following:
 
inability to obtain, or delays in obtaining, necessary zoning, land-use, building, occupancy, and other required permits and authorizations;
increased materials and labor costs, problems with contractors or subcontractors, or other costs including those costs due to errors and omissions which occur in the design or construction process;
inability to obtain financing with favorable terms;
inability to complete construction and lease-up of a community on schedule;
forecasted occupancy and rental rates may differ from the actual results; and
the incurrence of costs related to the abandonment of development opportunities which we have pursued and subsequently deemed unfeasible.
Our inability to successfully implement our development, redevelopment and construction strategy could adversely affect our results of operations and our ability to satisfy our financial obligations and pay distributions to shareholders.
One of our wholly-owned subsidiaries is engaged in the business of providing general contracting services under construction contracts entered into between it and third parties (which may include our nonconsolidated affiliates). The terms of those construction contracts generally require this subsidiary to estimate the time and costs to complete a project to calculate the cost plus margin for the project fee, but not to exceed a maximum amount, and to assume the risk when these estimates may be greater than anticipated. As a result, profitability on those contracts is dependent on the ability to accurately predict such factors. The time and costs necessary to complete a project may be affected by a variety of factors, including, but not limited to, those listed above, many of which are beyond this subsidiary’s control. In addition, the terms of those contracts generally require this subsidiary to warrant its work for a period of time during which it may be required to repair, replace, or rebuild non-conforming work. Further, trailing liabilities, based on various legal theories such as claims of negligent construction, may result from such projects, and these trailing liabilities may go on for a number of years depending on the length of the statute of repose in the applicable jurisdictions.
Investments through joint ventures and investment funds involve risks not present in investments in which we are the sole investor.
We have invested and may continue to invest as a joint venture partner in joint ventures. These investments involve risks, including, but not limited to, the possibility the other joint venture partner may have business goals which are inconsistent with ours, possess the ability to take or force action or withhold consent contrary to our requests, or become insolvent and require us to assume and fulfill the joint venture’s financial obligations. We and our joint venture partners may each have the right to initiate a buy-sell arrangement, which could cause us to sell our interest, or acquire a joint venture partner’s interest, at a time when we otherwise would not have entered into such a transaction. Each joint venture agreement is individually negotiated, and our ability to operate, finance, or dispose of a community in our sole discretion may be limited to varying degrees depending on the terms of the applicable joint venture agreement. We account for three investment funds (collectively, the "Funds") utilizing the equity method of accounting. As of December 31, 2019, we had two discretionary investment funds, and in March 2015, we completed the formation of a third fund with an unaffiliated third party which did not own any properties in 2019, 2018, or 2017. The risks associated with our Funds, which we manage as the general partner and advisor, include, but are not limited to, the following:
one of our wholly-owned subsidiaries is the general partner of the Funds and has unlimited liability for the third-party debts, obligations, and liabilities of the Funds pursuant to partnership law;
investors in the Funds (other than us), by majority vote, may remove our subsidiary as the general partner of the Funds with or without cause and the Funds’ advisory boards, by a majority vote of their members, may remove our subsidiary as the general partner of the Funds at any time for cause;
while we have broad discretion to manage the Funds and make investment decisions on behalf of the Funds, the investors or the Funds' advisory boards must approve certain matters, and as a result we may be unable to make certain investments or implement certain decisions on behalf of the Funds which we consider beneficial;
our ability to dispose of all or a portion of our investments in the Funds is subject to significant restrictions; and
we may be liable if the Funds fail to comply with various tax or other regulatory matters.

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Competition could adversely affect our ability to acquire properties.
We expect other real estate investors will compete with us to acquire additional operating properties. This competition could increase prices for the type of properties we would likely pursue and adversely affect our ability to acquire these properties or achieve the expected profitability of such properties upon acquisition.
Our acquisition strategy may not produce the cash flows expected.
We may acquire additional operating properties on a selective basis. Our acquisition activities are subject to a number of risks, including, but not limited to, the following:
 
we may not be able to successfully integrate acquired properties into our existing operations;
our estimates of the costs, if any, of repositioning or redeveloping the acquired property may prove inaccurate;
the expected occupancy, rental rates and operating expenses may differ from the actual results;
we may not be able to obtain adequate financing; and
we may not be able to identify suitable candidates on terms acceptable to us and may not achieve expected returns or other benefits as a result of integration challenges, such as personnel and technology.
Changes in rent control or rent stabilization laws and regulations could adversely affect our operations and property values.
Certain states and local municipalities have recently adopted rent control or rent stabilization laws and regulations, imposing restrictions on amounts of rent increases which may be charged based solely on market conditions.  There are a number of additional states and local municipalities in which we operate also considering or being urged by advocacy groups to consider imposing rent control or rent stabilization laws and regulations.  Such laws and regulations could limit our ability to increase rents, charge certain fees, evict residents, or recover increases in our operating expenses and could make it more difficult to dispose of properties in certain circumstances. The terms of laws and regulations recently enacted, future laws and regulations which may be enacted, as well as any lawsuits against the Company arising from such issues, could have a significant adverse impact on our results of operations and could reduce the value of our operating properties.
Failure to qualify as a REIT could have adverse consequences.

We may not continue to qualify as a REIT in the future. Also, the Internal Revenue Service may challenge our qualification as a REIT for prior years. If we fail to qualify as a REIT in any taxable year, we may be subject to federal and state income taxes for such year. In addition, we may not be able to requalify as a REIT for the four subsequent taxable years and may be subject to federal and state income taxes in those years as well. This may also impair our ability to expand our business and raise capital which may adversely affect the value of our common shares.

We may face other tax liabilities in the future which may impact our cash flow. These potential tax liabilities may be calculated on our income or property values at either the corporate or individual property levels. Any additional tax expense incurred would decrease the cash available for cash distributions to our common shareholders and non-controlling interest holders. Additionally, in order for us to continue to qualify as a REIT we must meet a number of organizational and operational requirements, including a requirement to distribute annual dividends to our shareholders equal to a minimum of 90% of our adjusted taxable income.
Tax laws have recently changed and may continue to change at any time, and any such legislative or other actions could have a negative effect on us.
Tax laws remain under constant review by persons involved in the legislative process, at the Internal Revenue Service, the U.S. Department of Treasury, and by various state and local tax authorities. Future changes in tax laws, including to administrative interpretations, enacted tax rates, or new pronouncements relating to accounting for income taxes could adversely affect us in a number of ways, including making it more difficult or more costly for us to qualify as a REIT.
Litigation risks could affect our business.
As an owner, manager and developer of multifamily properties, we may incur liability based on various conditions at our properties and the buildings thereon, and we also have become and in the future may become involved in legal proceedings, including consumer, employment, tort or commercial litigation, which if decided adversely to or settled by us, and not adequately covered by insurance, could result in liability which is material to our financial condition or results of operations.

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Damage from catastrophic weather and other natural events could result in losses.
A certain number of our properties are located in areas which have experienced and may in the future experience catastrophic weather and other natural events from time to time, including fires, snow or ice storms, windstorms, tornadoes, hurricanes, earthquakes, flooding or other severe weather, or other environmental events. These adverse weather or natural events could cause substantial damages or losses to our properties which could exceed our insurance coverage. In the event of a loss in excess of insured limits, we could lose our capital invested in the affected property, anticipated future revenue from the property, and could also continue to be obligated to repay any mortgage indebtedness or other obligations related to the property. Any such loss could materially and adversely affect our business, financial condition and results of operations.

The implementation of future enhancements to our new enterprise resource planning system could interfere with our business and operations.
We have completed the first phase of a multi-year implementation of an enterprise resource planning (ERP) system which replaced our previous financial accounting system. This ERP system maintains our books and records, records transactions, and provides important information relating to the operations of our business to our management. The implementation of this ERP system has required, and will continue to require, the investment of significant personnel and financial resources. While we have invested, and will continue to invest, significant resources in planning and project management, issues may arise during the implementation of future enhancements which may result in operational or financial reporting delays, increased costs or other difficulties not presently contemplated.  Any disruptions, delays or deficiencies in the design and implementation of future enhancements to the ERP system could have a materially adverse effect on our financial condition and results of operations.
A cybersecurity incident and other technology disruptions could negatively impact our business.
We use technology in substantially all aspects of our business operations, including internet and cloud-based systems and applications. We also use mobile devices, social networking, outside vendors and other online activities to connect with our employees, suppliers and residents. Such uses and the on-going advancement in technology give rise to potential cybersecurity risks with increasing sophistication, including but not limited to, security breach, espionage, system disruption, theft and inadvertent release of confidential information. Our business involves the storage and transmission of numerous classes of sensitive and confidential information and intellectual property, including residents' and suppliers' personal information, private information about employees, and financial and strategic information about us. Further, as we pursue our strategy to grow through acquisitions and developments and to pursue new initiatives to improve our operations, we are also expanding our information technologies, resulting in a larger technological presence and corresponding exposure to cybersecurity risk. If we fail to assess and identify cybersecurity risks associated with our operations, we may become increasingly vulnerable to such risks and may be liable for the consequential litigation and remediation costs. Additionally, the measures we have implemented to prevent security breaches and cyber incidents may not be effective and there can be no complete assurance of prevention or anticipation of such incidents. The theft, destruction, loss, misappropriation, or release of sensitive data, confidential information or intellectual property, or interference with our information technology systems or the technology systems of third parties on which we rely could result in business disruption, negative publicity, brand damage, violation of privacy laws, loss of residents, potential liability and competitive disadvantage, any of which could result in a material adverse effect on our financial condition or results of operations.
Our third-party service providers are primarily responsible for the security of their own information technology environments and in certain instances, we rely significantly on third-party service providers to supply and store our sensitive data in a secure manner. All of these third parties face potential risks relating to cybersecurity similar to ours which could disrupt their businesses and therefore adversely impact us. While we provide guidance and specific requirements in some cases, we do not directly control any of these parties' information technology security operations, or the amount of investment they place in guarding against cybersecurity threats. Accordingly, we are subject to any flaws in or breaches to their information technology systems or those which they operate for us, which could have a material adverse effect on our financial condition or results of operations.
Risks Associated with Our Indebtedness and Financing
We have significant debt, which could have adverse consequences.
As of December 31, 2019, we had outstanding debt of approximately $2.5 billion. This indebtedness could have adverse consequences, including, but not limited to, the following:  
our vulnerability to general adverse economic and industry conditions is increased; and
our flexibility in planning for, or reacting to, changes in business and industry conditions is limited.
Our unsecured credit facility and the indenture under which our unsecured 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 provisions could limit our financial flexibility. A default in these provisions, if uncured,

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could require us to repay the indebtedness before the scheduled maturity date, which could adversely affect our liquidity and increase our financing costs.
Insufficient cash flows could limit our ability to make required payments for debt obligations or pay distributions to shareholders.
Substantially all of our income is derived from rental and other income from our multifamily communities. As a result, our performance depends in large part on our ability to collect rent from residents, which could be negatively affected by a number of factors, including, but not limited to, the following:
 
delay in resident lease commencements;
decline in occupancy;
failure of residents to make rental payments when due;
the attractiveness of our properties to residents and potential residents;
our ability to adequately manage and maintain our communities;
competition from other available apartments and housing alternatives;
changes in market rents;
increases in operating expenses; and
changes in governmental regulations such as rent control or stabilization laws regulating rental housing.
Cash flow could be insufficient to meet required payments of principal and interest with respect to debt financing. In order for us to continue to qualify as a REIT we must meet a number of organizational and operational requirements, including a requirement to distribute annual dividends to our shareholders equal to a minimum of 90% of our adjusted taxable income. This requirement limits the cash available to meet required principal payments on our debt.
Issuances of additional debt may adversely impact our financial condition.
Our capital requirements depend on numerous factors, including the rental and occupancy rates of our multifamily properties, minimum dividend requirements to our equity holders, development, redevelopment and other capital expenditures, costs of operations, and potential acquisitions. If our capital requirements vary materially from our plans, we may require additional financing earlier than anticipated. If we issue more debt, we could become more leveraged, resulting in increased risk of default on our obligations and an increase in our debt service requirements, both of which could adversely affect our financial condition and ability to access debt and equity capital markets in the future.
We may be unable to renew, repay, or refinance our outstanding debt.
We are subject to the risk our unsecured indebtedness will not be renewed, repaid, or refinanced when due or the terms of any renewal or refinancing will not be as favorable as the existing terms of such indebtedness. If we are unable to refinance our indebtedness on acceptable terms, or at all, we might be forced to dispose of one or more of the properties on disadvantageous terms, which might result in losses to us. Such losses could have a material adverse effect on us and our ability to pay amounts due on our debt and make distributions to our shareholders.
We may be adversely affected by changes in LIBOR reporting practices or the method in which LIBOR is determined.
Our unsecured credit facility and unsecured term loan are indexed to the London Interbank Offered Rate ("LIBOR"). It is unclear whether LIBOR will continue to be calculated or published as a reference rate/benchmark after 2021. To address the potential for LIBOR’s cessation, the Federal Reserve Board and the Federal Reserve Bank of New York (FRBNY), in coordination with multiple other regulators and large industry participants, convened the Alternative Reference Rates Committee (“ARRC”). The ARRC has identified the Secured Overnight Financing Rate (SOFR) as the preferred successor rate for LIBOR. We are closely monitoring the progress of the phase-out of LIBOR and incorporating relatively standardized fallback language into our LIBOR-indexed debt documents for transitioning to an alternative index (which is defined to be the index that becomes generally used by lenders and other market participants) and a spread adjustment mechanism to prevent lenders from receiving a lower rate upon transition. There is significant uncertainty with respect to how the phase-out will be implemented and what alternative index will be adopted, which will ultimately be determined by the market as a whole. It therefore remains uncertain how such changes will be implemented and the effects such changes would have on us and the financial markets generally. These changes may have a material adverse impact on the availability of financing and on our financing costs.

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Rising interest rates could both increase our borrowing costs, thereby adversely affecting our cash flows and the amounts available for distribution to our shareholders, and decrease our share price, if investors seek higher yields through other investments.
We have an unsecured credit facility and an unsecured term loan bearing interest at variable rates on all amounts drawn. We may incur mortgage debt or other additional variable rate debt in the future. Increases in interest rates would increase our interest expense, unless we make arrangements which hedge the risk of rising interest rates, and would increase the costs of refinancing existing debt and of issuing new debt. Accordingly, higher interest rates would adversely affect cash flow, net income, and cash available for payment of our debt obligations and distributions to shareholders.
An environment of rising interest rates could also lead holders of our securities to seek higher yields through other investments, which could adversely affect the market price of our shares. One of the factors which may influence the price of our stock in public markets is the annual distribution rate we pay as compared with the yields on alternative investments.
Failure to maintain our current credit ratings could adversely affect our cost of funds, related margins, liquidity, and access to capital markets.
Moody’s, Fitch, and Standard & Poor's, the major debt rating agencies, routinely evaluate our debt and have given us ratings of A3 with stable outlook, A- with stable outlook, and A- with stable outlook, respectively, on our senior unsecured debt as of December 31, 2019. These ratings are based on a number of factors, which include their assessment of our financial strength, liquidity, capital structure, asset quality, and sustainability of cash flow and earnings. Due to changes in market conditions, 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.
Risks Associated with Our Shares
Share ownership limits and our ability to issue additional equity securities may prevent takeovers beneficial to shareholders.
For us to maintain our qualification as a REIT, we must have 100 or more shareholders during the year and not more than 50% in value of our outstanding shares may be owned, directly or indirectly, by five or fewer individuals. As defined for federal income tax purposes, the term “individuals” includes a number of specified entities. To minimize the possibility of us failing to qualify as a REIT under this test, our declaration of trust includes restrictions on transfers of our shares and ownership limits. The ownership limits, as well as our ability to issue other classes of equity securities, may delay, defer, or prevent a change in control. These provisions may also deter tender offers for our common shares which may be attractive to you or limit your opportunity to receive a premium for your shares which might otherwise exist if a third party were attempting to effect a change in control transaction.
Our share price will fluctuate.
The market price and trading volume of our common shares are subject to fluctuation due to general market conditions, the risks discussed in this report and other matters, including, but not limited to, the following:
 
operating results which vary from the expectations of securities analysts and investors;
investor interest in our property portfolio;
the reputation and performance of REITs;
the attractiveness of REITs as compared to other investment vehicles;
the results of our financial condition and operations;
the perception of our growth and earnings potential;
minimum dividend requirements;
increases in market interest rates, which may lead purchasers of our common shares to demand a higher yield; and
changes in financial markets and national and regional economic and general market conditions.
The form, timing and amount of dividend distributions in future periods may vary and be impacted by economic and other considerations.
The form, timing and amount of dividend distributions will be declared at the discretion of our Board of Trust Managers and will depend on actual cash from operations, our financial condition, capital requirements, the annual distribution requirements

8


under the REIT provisions of the Code and other factors as the Board of Trust Managers may consider relevant. The Board of Trust Managers may modify the form, timing and amount of dividends from time to time.
Item 1B. Unresolved Staff Comments
None.
Item 2. Properties
The Properties
Our properties typically consist of mid-rise buildings or two and three story buildings in a landscaped setting, as well as high-rise buildings, and provide residents with a variety of amenities common to multifamily rental properties.
Operating Properties (including properties held through unconsolidated joint ventures)
The 164 operating properties in which we owned interests and operated at December 31, 2019 averaged 959 square feet of living area per apartment home. For the year ended December 31, 2019, no single operating property accounted for greater than 1.5% of our total revenues. Our stabilized operating properties had a weighted average occupancy rate of approximately 96% for each of the years ended December 31, 2019 and 2018 and an average monthly rental revenue per apartment home of $1,562 and $1,502 for the same periods, respectively. Resident lease terms generally range from twelve to fifteen months. At December 31, 2019, 147 of our operating properties had over 200 apartment homes, with the largest having 904 apartment homes. Our operating properties were constructed and placed in service as follows:
Year Placed in ServiceNumber of Operating Properties
2015-201925
2010-201418
2005-200933
2000-200442
1995-199936
Prior to 199510

Property Table
The following table sets forth information with respect to our 164 operating properties at December 31, 2019:
 
  OPERATING PROPERTIES
Property and Location 
Year Placed
in Service
 
Average Apartment
Size (Sq. Ft.)
 
Number of
Apartments
 2019 Average
Occupancy  (1)
 2019 Average
Monthly Rental
Rate per
Apartment (2)
ARIZONA          
Phoenix/Scottsdale          
Camden Chandler 2016 1,146
 380 95.7% $1,462
Camden Copper Square 2000 786
 332 96.4
 1,223
Camden Foothills 2014 1,032
 220 95.8
 1,682
Camden Hayden 2015 1,043
 234 94.9
 1,527
Camden Legacy 1996 1,067
 428 95.0
 1,384
Camden Montierra 1999 1,071
 249 96.8
 1,412
Camden North End (3) 2019 921
 441 Lease-Up
 1,607
Camden Old Town Scottsdale (4) 2016 890
 316 94.1
 1,719

9


  OPERATING PROPERTIES
Property and Location 
Year Placed
in Service
 
Average Apartment
Size (Sq. Ft.)
 
Number of
Apartments
 2019 Average
Occupancy  (1)
 2019 Average
Monthly Rental
Rate per
Apartment (2)
Camden Pecos Ranch 2001 924
 272 96.6% $1,199
Camden San Marcos 1995 984
 320 97.2
 1,337
Camden San Paloma 1993/1994 1,042
 324 96.9
 1,352
Camden Sotelo 2008/2012 1,303
 170 95.6
 1,551
CALIFORNIA          
Los Angeles/Orange County          
Camden Crown Valley 2001 1,009 380 96.8
 2,119
Camden Glendale 2015 882 303 95.2
 2,486
Camden Harbor View (5) 2004 981 546 94.7
 2,659
Camden Main and Jamboree 2008 1,011 290 96.3
 2,133
Camden Martinique 1986 795 714 96.2
 1,858
Camden Sea Palms 1990 891 138 96.1
 2,169
The Camden 2016 768 287 95.5
 3,202
San Diego/Inland Empire          
Camden Landmark 2006 982 469 95.6
 1,672
Camden Old Creek 2007 1,037 350 96.7
 2,235
Camden Sierra at Otay Ranch 2003 962 422 94.2
 2,053
Camden Tuscany 2003 896 160 95.1
 2,643
Camden Vineyards 2002 1,053 264 96.4
 1,808
COLORADO          
Denver          
Camden Belleview Station 2009 888 270 95.9
 1,507
Camden Caley 2000 925 218 94.9
 1,516
Camden Denver West 1997 1,015 320 96.7
 1,794
Camden Flatirons 2015 960 424 96.1
 1,670
Camden Highlands Ridge 1996 1,149 342 95.3
 1,784
Camden Interlocken 1999 1,010 340 95.9
 1,693
Camden Lakeway 1997 932 451 95.4
 1,595
Camden Lincoln Station 2017 844 267 96.3
 1,602
WASHINGTON DC METRO          
Camden Ashburn Farm 2000 1,062 162 97.3
 1,736
Camden College Park 2008 942 508 96.4
 1,614
Camden Dulles Station 2009 978 382 97.2
 1,806
Camden Fair Lakes 1999 1,056 530 96.8
 1,875
Camden Fairfax Corner 2006 934 489 96.7
 1,946
Camden Fallsgrove 2004 996 268 96.7
 1,810
Camden Grand Parc 2002 672 105 95.9
 2,564
Camden Lansdowne 2002 1,006 690 96.8
 1,685
Camden Largo Town Center 2000/2007 1,027 245 96.1
 1,684
Camden Monument Place 2007 856 368 96.6
 1,669
Camden NoMa 2014 770 321 96.4
 2,268
Camden NoMa II 2017 759 405 95.7
 2,349
Camden Potomac Yard (5) 2008 835 378 95.7
 2,057

10


  OPERATING PROPERTIES
Property and Location 
Year Placed
in Service
 
Average Apartment
Size (Sq. Ft.)
 
Number of
Apartments
 2019 Average
Occupancy  (1)
 2019 Average
Monthly Rental
Rate per
Apartment (2)
Camden Roosevelt 2003 856 198 95.5% $2,893
Camden Russett 2000 992 426 95.9
 1,511
Camden Shady Grove (6) 2018 877 457 95.8
 1,739
Camden Silo Creek 2004 975 284 97.2
 1,672
Camden South Capitol (7) 2013 821 281 96.4
 2,324
Camden Washingtonian (6) 2018 871 365 96.3
 1,718
FLORIDA          
Southeast Florida          
Camden Aventura 1995 1,108 379 95.7
 1,987
Camden Boca Raton 2014 843 261 96.4
 1,964
Camden Brickell (5) 2003 937 405 94.5
 2,123
Camden Doral 1999 1,120 260 97.3
 1,958
Camden Doral Villas 2000 1,253 232 97.0
 2,092
Camden Las Olas (5) 2004 1,043 420 93.8
 2,093
Camden Plantation 1997 1,201 502 96.4
 1,709
Camden Portofino 1995 1,112 322 96.6
 1,776
Orlando          
Camden Hunter’s Creek 2000 1,075 270 97.0
 1,466
Camden Lago Vista 2005 955 366 96.9
 1,346
Camden LaVina 2012 970 420 95.9
 1,364
Camden Lee Vista 2000 937 492 95.9
 1,296
Camden North Quarter 2016 806 333 95.2
 1,576
Camden Orange Court 2008 817 268 96.0
 1,376
Camden Thornton Park 2016 920 299 95.1
 1,882
Camden Town Square 2012 983 438 96.8
 1,404
Camden Waterford Lakes (7) 2014 971 300 96.1
 1,454
Camden World Gateway 2000 979 408 96.8
 1,360
Tampa/St. Petersburg          
Camden Bay 1997/2001 943
 760 95.5
 1,234
Camden Montague 2012 975
 192 96.4
 1,358
Camden Pier District 2016 989
 358 96.1
 2,490
Camden Preserve 1996 942
 276 95.2
 1,459
Camden Royal Palms 2006 1,017
 352 95.9
 1,244
Camden Visconti (7) 2007 1,125
 450 95.7
 1,377
Camden Westchase Park 2012 992
 348 96.9
 1,454
GEORGIA          
Atlanta          
Camden Brookwood 2002 912
 359 95.9
 1,432
Camden Buckhead Square 2015 827
 250 95.9
 1,589
Camden Creekstone 2002 990
 223 97.0
 1,385
Camden Deerfield 2000 1,187
 292 95.9
 1,432
Camden Dunwoody 1997 1,007
 324 96.5
 1,363
Camden Fourth Ward 2014 847
 276 97.2
 1,730

11


  OPERATING PROPERTIES
Property and Location 
Year Placed
in Service
 
Average Apartment
Size (Sq. Ft.)
 
Number of
Apartments
 2019 Average
Occupancy  (1)
 2019 Average
Monthly Rental
Rate per
Apartment (2)
Camden Midtown Atlanta 2001 935
 296 96.4% $1,532
Camden Paces 2015 1,407
 379 96.1
 2,724
Camden Peachtree City 2001 1,027
 399 96.7
 1,320
Camden Phipps (7) 1996 1,018
 234 95.8
 1,563
Camden Shiloh 1999/2002 1,143
 232 97.1
 1,325
Camden St. Clair 1997 999
 336 96.0
 1,376
Camden Stockbridge 2003 1,009
 304 96.1
 1,135
Camden Vantage 2010 901
 592 95.6
 1,462
NORTH CAROLINA          
Charlotte          
Camden Ballantyne 1998 1,048
 400 95.9
 1,290
Camden Cotton Mills 2002 905
 180 95.8
 1,485
Camden Dilworth 2006 857
 145 95.9
 1,467
Camden Fairview 1983 1,036
 135 96.6
 1,204
Camden Foxcroft 1979 940
 156 96.9
 1,073
Camden Foxcroft II 1985 874
 100 96.4
 1,183
Camden Gallery 2017 743
 323 96.2
 1,583
Camden Grandview 2000 1,059
 266 96.1
 1,685
Camden Grandview II (3) 2019 2,242
 28 Lease-Up
 3,968
Camden Sedgebrook 1999 972
 368 96.7
 1,141
Camden South End 2003 882
 299 94.8
 1,454
Camden Southline (7) 2015 831
 266 96.4
 1,572
Camden Stonecrest 2001 1,098
 306 96.4
 1,324
Camden Touchstone 1986 899
 132 96.4
 1,091
Raleigh          
Camden Asbury Village (7) 2009 1,009
 350 96.0
 1,249
Camden Carolinian (3)(4) 2017 1,118
 186 Lease-Up
 2,331
Camden Crest 2001 1,013
 438 97.1
 1,068
Camden Governor’s Village 1999 1,046
 242 96.1
 1,112
Camden Lake Pine 1999 1,066
 446 96.6
 1,189
Camden Manor Park 2006 966
 484 96.1
 1,168
Camden Overlook 2001 1,060
 320 96.5
 1,278
Camden Reunion Park 2000/2004 972
 420 95.2
 1,079
Camden Westwood 1999 1,027
 354 92.8
 1,120
TEXAS          
Austin          
Camden Amber Oaks (7) 2009 862
 348 96.5
 1,121
Camden Amber Oaks II (7) 2012 910
 244 96.3
 1,178
Camden Brushy Creek (7) 2008 882
 272 96.4
 1,184
Camden Cedar Hills 2008 911
 208 95.7
 1,298
Camden Gaines Ranch 1997 955
 390 96.8
 1,459
Camden Huntingdon 1995 903
 398 96.5
 1,200

12


  OPERATING PROPERTIES
Property and Location 
Year Placed
in Service
 
Average Apartment
Size (Sq. Ft.)
 
Number of
Apartments
 2019 Average
Occupancy  (1)
 2019 Average
Monthly Rental
Rate per
Apartment (2)
Camden La Frontera 2015 901
 300 95.7% $1,256
Camden Lamar Heights 2015 838
 314 95.7
 1,528
Camden Rainey Street (4) 2016 873
 326 94.3
 2,264
Camden Shadow Brook (7) 2009 909
 496 95.6
 1,179
Camden Stoneleigh 2001 908
 390 97.0
 1,305
Dallas/Fort Worth          
Camden Addison 1996 942
 456 96.9
 1,253
Camden Belmont 2010/2012 945
 477 95.5
 1,472
Camden Buckingham 1997 919
 464 96.3
 1,249
Camden Centreport 1997 911
 268 96.2
 1,209
Camden Cimarron 1992 772
 286 96.7
 1,244
Camden Design District (7) 2009 939
 355 95.8
 1,405
Camden Farmers Market 2001/2005 932
 904 95.0
 1,374
Camden Henderson 2012 967
 106 97.0
 1,541
Camden Legacy Creek 1995 831
 240 96.7
 1,303
Camden Legacy Park 1996 871
 276 96.0
 1,299
Camden Panther Creek (7) 2009 946
 295 96.5
 1,267
Camden Riverwalk (7) 2008 982
 600 95.9
 1,485
Camden Valley Park 1986 743
 516 96.7
 1,093
Camden Victory Park 2016 861
 423 96.3
 1,665
Houston          
Camden City Centre 2007 932
 379 94.2
 1,500
Camden City Centre II 2013 868
 268 95.7
 1,515
Camden Cypress Creek (7) 2009 993
 310 96.2
 1,326
Camden Downs at Cinco Ranch (7) 2004 1,075
 318 95.8
 1,269
Camden Grand Harbor (7) 2008 959
 300 95.2
 1,188
Camden Greenway 1999 861
 756 96.2
 1,399
Camden Heights (7) 2004 927
 352 95.3
 1,503
Camden Highland Village (4) 2014/2015 1,175
 552 88.0
 2,438
Camden Holly Springs 1999 934
 548 95.9
 1,235
Camden McGowen Station (6) 2018 1,007
 315 95.2
 2,092
Camden Midtown 1999 844
 337 95.3
 1,547
Camden Northpointe (7) 2008 940
 384 96.2
 1,147
Camden Oak Crest 2003 870
 364 96.1
 1,136
Camden Park 1995 866
 288 95.8
 1,106
Camden Plaza 2007 915
 271 94.4
 1,594
Camden Post Oak 2003 1,200
 356 95.3
 2,460
Camden Royal Oaks 2006 923
 236 93.6
 1,366
Camden Royal Oaks II 2012 1,054
 104 97.6
 1,593
Camden Spring Creek (7) 2004 1,080
 304 95.4
 1,238
Camden Stonebridge 1993 845
 204 95.8
 1,116
Camden Sugar Grove 1997 921
 380 95.4
 1,200

13


  OPERATING PROPERTIES
Property and Location 
Year Placed
in Service
 
Average Apartment
Size (Sq. Ft.)
 
Number of
Apartments
 2019 Average
Occupancy  (1)
 2019 Average
Monthly Rental
Rate per
Apartment (2)
Camden Travis Street 2010 819
 253 96.6% $1,489
Camden Vanderbilt 1996/1997 863
 894 96.1
 1,437
Camden Whispering Oaks 2008 934
 274 94.9
 1,244
Camden Woodson Park (7) 2008 916
 248 94.4
 1,213
Camden Yorktown (7) 2008 995
 306 95.7
 1,188
(1)Represents the average physical occupancy for the year except as noted.
(2)The average monthly rental rate per apartment incorporates vacant units and resident concessions calculated on a straight-line basis over the life of the lease.
(3)Property under lease-up at December 31, 2019.
(4)Property acquired in 2019 - the average occupancy was calculated from the date the property was acquired.
(5)Property under redevelopment at December 31, 2019.
(6)Development property stabilized during 2019 - the average occupancy was calculated from the date at which the occupancy exceeded 90% through December 31, 2019.
(7)Property owned through an unconsolidated joint venture in which we own a 31.3% interest. The remaining interest is owned by an unaffiliated third-party.
Item 3. Legal Proceedings
None.
Item 4. Mine Safety Disclosures
None.

14


PART II
Item 5. Market for Registrant’s Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities
Our common shares are traded on the New York Stock Exchange under the symbol "CPT." As of February 13, 2020, there were approximately 340 shareholders of record and 51,751 beneficial owners of our common shares.
In the first quarter of 2020, the Company's Board of Trust Managers declared a first quarter dividend of $0.83 per common share to our common shareholders of record as of March 31, 2020. Future dividend payments are paid at the discretion of the Board of Trust Managers and depend on cash flows generated from operations, the Company's financial condition and capital requirements, distribution requirements under the REIT provisions of the Code and other factors which may be deemed relevant by our Board of Trust Managers. Assuming similar dividend distributions for the remainder of 2020, our annualized dividend rate for 2020 would be $3.32 as compared to a dividend rate of $3.20 in 2019.
The following graph assumes the investment of $100 on December 31, 2014 and quarterly reinvestment of dividends, including a special dividend of $4.25 paid in September 2016.
chart-ada0b8db40bf5a1d99ba02.jpg
(Source: S&P Global Market Intelligence)
 
    
Index2015 2016 2017 2018 2019
Camden Property Trust$107.92
 $128.68
 $145.81
 $144.33
 $179.26
FTSE NAREIT Equity103.20
 111.99
 117.84
 112.39
 141.61
S&P 500101.38
 113.51
 138.29
 132.23
 173.86
Russell 200095.59
 115.95
 132.94
 118.30
 148.49

   

15


In May 2017, we created an at-the market ("ATM") share offering program through which we can, but have no obligation to, sell common shares having an aggregate offering price of up to $315.3 million (the "2017 ATM program"), in amounts and at times as we determine, into the existing trading market at current market prices as well as through negotiated transactions. Actual sales from time to time may depend on a variety of factors including, among others, market conditions, the trading price of our common shares, and determinations by management of the appropriate sources of funding for us. During the years ended December 31, 2019 and 2017, we issued approximately 0.2 million and 28.1 thousand common shares, respectively, under the 2017 ATM program for a total net consideration of approximately $24.8 million and $2.5 million, respectively. We did not sell any shares under the 2017 ATM Program during the year ended December 31, 2018. The proceeds from the sale of our common shares under the 2017 ATM program are intended to be used for general corporate purposes, which may include reducing future borrowings under our unsecured line of credit, the repayment of other indebtedness, the redemption or other repurchase of outstanding debt or equity securities, funding for development activities, and financing for acquisitions.
As of the date of this filing, we had common shares having an aggregate offering price of up to $287.7 million remaining available for sale under the 2017 ATM program. No additional shares were sold under the 2017 ATM program subsequent to December 31, 2019 through the date of this filing.
See Part III, Item 12, for a description of securities authorized for issuance under equity compensation plans.
We have a repurchase plan approved by our Board of Trust Managers which allows for the repurchase of up to $500 million of our common equity securities through open market purchases, block purchases, and privately negotiated transactions. During the year ended December 31, 2018, we repurchased 3,222 common shares for approximately $0.3 million. There were no repurchases under this program for the years ended December 31, 2017 or 2019 or through the date of this filing. The remaining dollar value of our common equity securities authorized to be repurchased under this program was approximately $269.5 million as of the date of this filing.

16


Item 6. Selected Financial Data
The following table provides selected financial data relating to our historical financial condition and results of operations as of and for each of the years ended December 31, 2015 through 2019. This data should be read in conjunction with Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the consolidated financial statements and related notes. Prior year amounts have been reclassified for discontinued operations.
COMPARATIVE SUMMARY OF SELECTED FINANCIAL AND PROPERTY DATA
 
 Year Ended December 31,
(in thousands, except per share amounts and property data)2019 2018 2017 2016 2015
Operating Data (a)         
Property revenues$1,028,461
 $954,505
 $900,896
 $876,447
 $835,618
Total property expenses366,347
 343,579
 328,742
 311,355
 301,000
Total non-property income33,480
 2,797
 27,795
 14,577
 7,332
Total other expenses522,924
 459,441
 447,595
 425,190
 412,022
Income from continuing operations attributable to common shareholders219,623
 156,128
 196,422
 436,981
 229,565
Net income attributable to common shareholders219,623
 156,128
 196,422
 819,823
 249,315
Earnings per common share from continuing operations:         
Basic$2.23
 $1.63
 $2.14
 $4.81
 $2.55
Diluted2.22
 1.63
 2.13
 4.79
 2.54
Total earnings per common share:         
Basic$2.23
 $1.63
 $2.14
 $9.08
 $2.77
Diluted2.22
 1.63
 2.13
 9.05
 2.76
Distributions declared per common share$3.20
 $3.08
 $3.00
 $3.00
 $2.80
Special dividend per common share (b)$
 $
 $
 $4.25
 $
Balance Sheet Data (at end of year)         
Total real estate assets, at cost (c)$9,115,793
 $8,328,475
 $7,667,743
 $7,376,690
 $7,387,597
Total assets6,748,504
 6,219,586
 6,173,748
 6,028,152
 6,037,612
Notes payable2,524,099
 2,321,603
 2,204,598
 2,480,588
 2,724,687
Non-qualified deferred compensation share awards
 52,674
 77,230
 77,037
 79,364
Equity3,701,724
 3,385,104
 3,484,714
 3,095,553
 2,892,896
Other Data         
Cash flows provided by (used in):         
Operating activities$555,597
 $503,747
 $434,656
 $443,063
 $423,238
Investing activities(792,445) (640,921) (189,754) 690,412
 (293,235)
Financing activities220,744
 (197,028) (112,923) (904,237) (273,231)
Funds from operations – diluted (d)505,388
 463,982
 424,072
 425,464
 414,497
Adjusted funds from operations – diluted (d)433,216
 391,686
 359,314
 366,380
 350,328
Property Data         
Number of operating properties (at the end of year) (e)164 161
 155
 152
 172
Number of operating apartment homes (at end of year)
(e)
56,107 55,160
 53,033
 52,793
 59,792
Number of operating apartment homes (weighted average) (e) (f)48,549 46,925
 46,210
 46,934
 47,088
Weighted average monthly total property revenue per apartment home (a) (f)$1,765
 $1,695
 $1,625
 $1,556
 $1,479
Properties under development (at end of period)8 6
 7
 7
 8
(a)Excludes discontinued operations. See Note 2, "Summary of Significant Accounting Policies and Recent Accounting Pronouncements," in the Notes to Consolidated Financial Statements for further discussion of discontinued operations.

17


(b)In addition to our 2016 quarterly dividends, our Board of Trust Managers declared a special dividend to our common shareholders of record as of September 23, 2016, consisting of gains on disposition of assets completed in 2016 which was paid on September 30, 2016.
(c)Includes operating properties held for sale at net book value and excludes properties from discontinued operations and joint ventures for all periods presented.
(d)Management considers Funds from Operations (“FFO”) and adjusted FFO ("AFFO") to be appropriate supplementary measures of the financial performance of an equity REIT. The National Association of Real Estate Investment Trusts (“NAREIT”) currently defines FFO as net income (computed in accordance with accounting principles generally accepted in the United States of America (“GAAP”)), excluding gains (or losses) associated with the sale of previously depreciated operating properties, real estate depreciation and amortization, impairments of depreciable assets, and adjustments for unconsolidated joint ventures to reflect FFO on the same basis. Our calculation of diluted FFO also assumes conversion of all potentially dilutive securities, including certain non-controlling interests, which are convertible into common shares. We consider FFO to be an appropriate supplemental measure of operating performance because, by excluding gains or losses on dispositions of operating properties, and depreciation, FFO can assist in the comparison of the operating performance of a company’s real estate investments between periods or to different companies. AFFO is calculated utilizing FFO less recurring capitalized expenditures which are necessary to help preserve the value of and maintain the functionality at our communities. We also consider AFFO to be a useful supplemental measure because it is frequently used by analysts and investors to evaluate a REIT's operating performance between periods or different companies. Our definition of recurring capital expenditures may differ from other REITs, and there can be no assurance our basis for computing this measure is comparable to other REITs. To facilitate a clear understanding of our consolidated historical operating results, we believe FFO and AFFO should be examined in conjunction with net income attributable to common shareholders as presented in the consolidated statements of income and comprehensive income and data included elsewhere in this report. FFO and AFFO are not defined by GAAP and should not be considered alternatives to net income attributable to common shareholders as an indication of our operating performance. Additionally, FFO and AFFO as disclosed by other REITs may not be comparable to our calculation. See "Funds from Operations and Adjusted FFO" in Item 7 "Management's Discussion and Analysis of Financial Condition and Results of Operations" for reconciliations of net income attributable to common shareholders to FFO and AFFO.
(e)Includes operating properties held for sale and discontinued operating properties held for sale for all periods presented.
(f)Excludes apartment homes owned in joint ventures.


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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following discussion should be read in conjunction with the consolidated financial statements and notes appearing elsewhere in this report. Historical results and trends which might appear in the consolidated financial statements should not be interpreted as being indicative of future operations.
Discussion of our year-to-date comparisons between 2019 and 2018 is presented below. Year-to-date comparisons between 2018 and 2017 can be found in "Part II. Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on Form 10-K for the fiscal year ended December 31, 2018.
We consider portions of this report to be "forward-looking" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, both as amended, with respect to our expectations for future periods. Forward-looking statements do not discuss historical fact, but instead include statements related to expectations, projections, intentions, or other items relating to the future; forward-looking statements are not guarantees of future performance, results, or events. Although we believe the expectations reflected in our forward-looking statements are based upon reasonable assumptions, we can give no assurance our expectations will be achieved. Any statements contained herein which are not statements of historical fact should be deemed forward-looking statements. Reliance should not be placed on these forward-looking statements as these statements are subject to known and unknown risks, uncertainties, and other factors beyond our control and could differ materially from our actual results and performance.
Factors which may cause our actual results or performance to differ materially from those contemplated by forward-looking statements include, but are not limited to, the following:
 
Volatility in capital and credit markets, or other unfavorable changes in economic conditions, either nationally or regionally in one or more of the markets in which we operate, could adversely impact us;
Short-term leases expose us to the effects of declining market rents;
Competition could limit our ability to lease apartments or increase or maintain rental income;
We face risks associated with land holdings and related activities;
Development, redevelopment and construction risks could impact our profitability;
Investments through joint ventures and investment funds involve risks not present in investments in which we are the sole investor;
Competition could adversely affect our ability to acquire properties;
Our acquisition strategy may not produce the cash flows expected;
Changes in rent control or rent stabilization laws and regulations could adversely affect our operations and property values;
Failure to qualify as a REIT could have adverse consequences;
Tax laws have recently changed and may continue to change at any time, and any such legislative or other actions could have a negative effect on us;
Litigation risks could affect our business;
Damage from catastrophic weather and other natural events could result in losses;
The implementation of future enhancements to our new enterprise resource planning system could interfere with our business and operations;
A cybersecurity incident and other technology disruptions could negatively impact our business;
We have significant debt, which could have adverse consequences;
Insufficient cash flows could limit our ability to make required payments for debt obligations or pay distributions to shareholders;
Issuances of additional debt may adversely impact our financial condition;
We may be unable to renew, repay, or refinance our outstanding debt;
We may be adversely affected by changes in LIBOR reporting practices or the method in which LIBOR is determined;

19


Rising interest rates could both increase our borrowing costs, thereby adversely affecting our cash flows and the amounts available for distribution to our shareholders, and decrease our share price, if investors seek higher yields through other investments;
Failure to maintain our current credit ratings could adversely affect our cost of funds, related margins, liquidity, and access to capital markets;
Share ownership limits and our ability to issue additional equity securities may prevent takeovers beneficial to shareholders;
Our share price will fluctuate; and
The form, timing and amount of dividend distributions in future periods may vary and be impacted by economic and other considerations.
These forward-looking statements represent our estimates and assumptions as of the date of this report, and we assume no obligation to update or supplement forward-looking statements because of subsequent events.
Executive Summary
We are primarily engaged in the ownership, management, development, redevelopment, acquisition, and construction of multifamily apartment communities. Overall, we focus on investing in markets characterized by high-growth economic conditions, strong employment, and attractive quality of life which we believe leads to higher demand and retention of our apartments. As of December 31, 2019, we owned interests in, operated, or were developing 172 multifamily properties comprised of 58,315 apartment homes across the United States as detailed in the following Property Portfolio table. In addition, we own other land holdings which we may develop into multifamily apartment communities in the future.
Consolidated Results
Net income attributable to common shareholders was approximately $219.6 million for the year ended December 31, 2019 as compared to $156.1 million for the same period in 2018. The approximately $63.5 million, or 40.7% increase was primarily due to an increase from property operations relating to our existing operating, newly developed and acquired operating communities. The increase also related to gains recognized on dispositions in 2019, including two consolidated operating properties and our proportionate share of one operating property by one of our unconsolidated joint ventures. These increases were partially offset by an increase in depreciation expense and a loss on early retirement of debt.
Property Operations
Our results for the year ended December 31, 2019 reflect an increase in same store revenues of 3.7% as compared to 2018. These increases were primarily due to higher average rental rates which we believe was primarily attributable to improving job growth, favorable demographics, a manageable supply of new multifamily housing, and in part to more individuals choosing to rent versus buy as evidenced by the continued low level of homeownership rates. We believe the continued low levels of homeownership rates are mainly attributable to costs of obtaining mortgage loans as well as changing trends of certain age-sectors having a higher propensity to rent, all of which promote apartment rentals. We also believe U.S. economic and employment growth are likely to continue during 2020 and the supply of new multifamily homes will likely remain at manageable levels. If economic conditions were to worsen or any of these factors were to adversely change, our operating results could be adversely affected.
Construction Activity
At December 31, 2019, we had a total of eight projects under construction to be comprised of 2,208 apartment homes, including one development project to be comprised of 234 apartment homes owned by one of our unconsolidated discretionary investment funds in which we have a 31.3% ownership interest. Initial occupancies of these eight projects are currently scheduled to occur within the next 24 months. Excluding the project owned by one of the Funds, we estimate the additional cost to complete the construction of the seven projects to be approximately $358.6 million.
Acquisitions
Operating properties: In December 2019, we acquired one operating property comprised of 186 apartment homes in Raleigh, North Carolina for approximately $75.1 million, and one operating property comprised of 552 apartment homes in Houston, Texas for approximately $147.2 million. In May 2019, we acquired one operating property comprised of 326 apartment homes located in Austin, Texas for approximately $120.4 million. In February 2019, we acquired one operating property comprised of 316 apartment homes located in Scottsdale, Arizona for approximately $97.1 million.
Land: In connection with the acquisition of the operating property in Houston, Texas in December 2019, we acquired approximately 2.3 acres of land adjacent to the operating property for approximately $8.0 million for the future development of

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approximately 300 apartment homes. In May 2019, we acquired approximately 11.6 acres of land in Tempe, Arizona for approximately $18.0 million for the future development of approximately 400 apartment homes. In April 2019, we acquired approximately 4.3 acres of land in Charlotte, North Carolina for approximately $10.9 million for the future development of approximately 400 apartment homes.
In January 2020, we acquired 4.9 acres of land in Raleigh, North Carolina for approximately $18.2 million for the future development of approximately 355 apartment homes.
Dispositions
Sale of Operating Properties: During the year ended December 31, 2019, we sold our remaining three operating properties in Corpus Christi, Texas. The operating properties sold included two consolidated communities comprised of 632 apartment homes and one joint venture community with 270 apartment homes. The total net proceeds from the disposition of the two consolidated communities was approximately $69.4 million and we recognized a gain of approximately $49.9 million. The proceeds from the disposition of the one property owned through the unconsolidated joint venture was approximately $38.5 million and our portion of the gain of approximately $6.2 million was recognized in equity in income of joint ventures.
Other
In February 2019, we issued approximately 3.4 million common shares in an underwritten equity offering and received approximately $328.4 million in net proceeds.
In March 2019, we amended and restated our $600 million unsecured credit facility to, among other things, extend the maturity date from August 2019 to March 2023, with two options to further extend the facility at our election for two additional six-month periods, and increased the facility from $600 million to $900 million, which may be expanded three times by up to an additional $500 million upon satisfaction of certain conditions.
In February and March 2019, we repaid a total of approximately $439.3 million of secured conventional mortgage debt.
In June 2019, we issued $600 million of senior unsecured notes due July 1, 2029 under our existing shelf registration statement.
In October 2019, we issued $300 million of senior unsecured notes due November 1, 2049 under our existing shelf registration statement.
In October 2019, we redeemed all of our 4.78% $250 million Senior Notes due 2021 and prepaid our 4.38% $45.3 million secured mortgage notes due 2045. In connection with these transactions, we recorded an approximate $12 million loss on early retirement of debt.
In 2019, we issued approximately 0.2 million shares under our 2017 ATM program and received approximately $24.8 million in net proceeds.
Future Outlook
Subject to market conditions, we intend to continue to seek opportunities to develop new communities, and to redevelop, reposition and acquire existing communities. We also intend to evaluate our operating property and land development portfolio and plan to continue our practice of selective dispositions as market conditions warrant and opportunities arise. We expect to maintain a strong balance sheet and preserve our financial flexibility by continuing to focus on our core fundamentals which currently are generating positive cash flows from operations, maintaining appropriate debt levels and leverage ratios, and controlling overhead costs. We intend to meet our near-term liquidity requirements through a combination of one or more of the following: cash flows generated from operations, draws on our unsecured credit facility, the use of debt and equity offerings under our automatic shelf registration statement, proceeds from property dispositions, equity issued from our ATM programs, other unsecured borrowings, or secured mortgages.
As of December 31, 2019, we had approximately $23.2 million in cash and cash equivalents, and $847.1 million available under our $900.0 million unsecured credit facility. As of the date of this filing, we had common shares having an aggregate offering price of up to $287.7 million remaining available for sale under our 2017 ATM program and do not have any debt maturing through the year ending 2021. Additionally, as of December 31, 2019 and through the date of this filing, 100% of our consolidated properties were unencumbered. We believe we are well-positioned with a strong balance sheet and sufficient liquidity to fund new development, redevelopment, and other capital funding requirements. We will, however, continue to assess and take further actions we believe are prudent to meet our objectives and capital requirements.

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Property Portfolio
Our multifamily property portfolio is summarized as follows:
 December 31, 2019 December 31, 2018
 
Apartment
Homes
 Properties 
Apartment
Homes
 Properties
Operating Properties       
Houston, Texas9,301
 26
 8,749
 25
Washington, D.C. Metro6,862
 19
 6,862
 19
Dallas, Texas5,666
 14
 5,666
 14
Atlanta, Georgia4,496
 14
 4,496
 14
Phoenix, Arizona3,686
 12
 2,929
 10
Austin, Texas3,686
 11
 3,360
 10
Orlando, Florida3,594
 10
 3,594
 10
Raleigh, North Carolina3,240
 9
 3,054
 8
Charlotte, North Carolina3,104
 14
 3,076
 13
Southeast Florida2,781
 8
 2,781
 8
Tampa, Florida2,736
 7
 2,736
 7
Los Angeles/Orange County, California2,658
 7
 2,658
 7
Denver, Colorado2,632
 8
 2,632
 8
San Diego/Inland Empire, California1,665
 5
 1,665
 5
Corpus Christi, Texas
 
 902
 3
Total Operating Properties56,107
 164
 55,160
 161
Properties Under Construction       
Houston, Texas505
 2
 271
 1
Atlanta, Georgia366
 1
 365
 1
Orlando, Florida360
 1
 360
 1
Phoenix, Arizona343
 1
 441
 1
Southeast Florida269
 1
 
 
Denver, Colorado233
 1
 233
 1
San Diego/Inland Empire, California132
 1
 
 
Charlotte, North Carolina
 
 28
 1
Total Properties Under Construction2,208
 8
 1,698
 6
Total Properties58,315
 172
 56,858
 167

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Less: Unconsolidated Joint Venture Properties (1)
       
Houston, Texas (2)
2,756
 9
 2,522
 8
Austin, Texas1,360
 4
 1,360
 4
Dallas, Texas1,250
 3
 1,250
 3
Tampa, Florida450
 1
 450
 1
Raleigh, North Carolina350
 1
 350
 1
Orlando, Florida300
 1
 300
 1
Washington, D.C. Metro281
 1
 281
 1
Charlotte, North Carolina266
 1
 266
 1
Atlanta, Georgia234
 1
 234
 1
Corpus Christi, Texas
 
 270
 1
Total Unconsolidated Joint Venture Properties7,247
 22
 7,283
 22
Total Properties Fully Consolidated51,068
 150
 49,575
 145

(1)Refer to Note 8, "Investments in Joint Ventures," in the notes to Consolidated Financial Statements for further discussion of our joint venture investments.
(2)Includes a property under construction owned by one of the Funds. See Communities Under Construction below for details.

Stabilized Communities
We generally consider a property stabilized once it reaches 90% occupancy. During the year ended December 31, 2019, stabilization was achieved at three consolidated operating properties as follows:

Stabilized Property and Location
Number of
Apartment
Homes
 
Date of
Construction
Completion
 
Date of
Stabilization
Consolidated Operating Property     
Camden Shady Grove     
Rockville, MD457
 1Q18 1Q19
Camden Washingtonian     
Gaithersburg, MD365
 4Q18 2Q19
Camden McGowen Station     
Houston, TX315
 4Q18 4Q19
Consolidated total1,137
    
      
Completed Construction in Lease-Up
At December 31, 2019, we had two consolidated completed operating properties in lease-up as follows:
($ in millions)
Property and Location
Number of
Apartment
Homes
 
Cost
Incurred (1)
 % Leased at 1/29/2020 Date of Construction Completion Estimated Date of Stabilization
Consolidated Operating Properties         
Camden North End I         
Phoenix, AZ441
 $98.8
 75% 1Q19 2Q20
Camden Grandview II         
Charlotte, NC28
 22.5
 93% 1Q19 1Q20
Consolidated total469
 $121.3
      
(1)    Excludes leasing costs, which are expensed as incurred.

Properties Under Development
Our consolidated balance sheet at December 31, 2019 included approximately $512.3 million related to properties under development and land. Of this amount, approximately $413.4 million related to our projects currently under construction. In

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addition, we had approximately $98.9 million primarily invested in land held for future development related to projects we currently expect to begin construction.
Communities Under Construction. At December 31, 2019, we had seven consolidated properties and one unconsolidated property held by one of the Funds, in various stages of construction as follows:
($ in millions)
Property and Location
Number of
Apartment
Homes
 Estimated
Cost
 Cost
Incurred
 Included in
Properties
Under
Development
 Estimated
Date of
Construction
Completion
 Estimated
Date of
Stabilization
Consolidated Communities Under Construction           
Camden Downtown I
Houston, TX
271
 $132.0
 $123.4
 $123.4
 3Q20 1Q21
Camden RiNo
Denver, CO
233
 75.0
 66.6
 66.6
 3Q20 4Q20
Camden Lake Eola
Orlando, FL
360
 120.0
 75.0
 75.0
 4Q20 3Q21
Camden Buckhead
Atlanta, GA
366
 160.0
 55.2
 55.2
 3Q21 2Q22
Camden North End II
Phoenix, AZ
343
 90.0
 31.3
 31.3
 4Q21 2Q22
Camden Hillcrest
San Diego, CA
132
 95.0
 42.7
 42.7
 3Q21 2Q22
Camden Atlantic
Plantation, FL
269
 100.0
 19.2
 19.2
 4Q21 1Q23
Consolidated total1,974
 $772.0
 $413.4
 $413.4
    
            
Unconsolidated Community Under Construction           
Camden Cypress Creek II (1)
     Cypress, TX
234
 $38.0
 $10.4
 $10.4
 1Q21 3Q21
(1)Property owned through an unconsolidated joint venture in which we own a 31.3% interest.
Development Pipeline Communities. At December 31, 2019, we had the following consolidated communities undergoing development activities:
($ in millions)
Property and Location
 
Projected
Homes
 
Total Estimated
Cost (1)
 Cost to Date
Camden Hayden II 400
 $110.0
 $22.0
Tempe, AZ      
Camden NoDa 400
 100.0
 14.8
Charlotte, NC      
Camden Arts District 354
 150.0
 26.9
Los Angeles, CA      
Camden Paces III 350
 100.0
 15.8
Atlanta, GA      
Camden Downtown II 271
 145.0
 11.4
Houston, TX      
Camden Highland Village II 300
 100.0
 8.0
Houston, TX      
Total 2,075
 $705.0
 $98.9
(1)Represents our estimate of total costs we expect to incur on these projects. However, forward-looking statements are not guarantees of future performance, results, or events. Although we believe these expectations are based upon reasonable assumptions, future events rarely develop exactly as forecasted, and estimates routinely require adjustment.

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Geographic Diversification
At December 31, 2019 and 2018, our real estate assets by various markets, excluding depreciation and investments in joint ventures, were as follows:
 
($ in thousands)2019 2018
Washington, D.C. Metro$1,574,746
 17.3% $1,551,925
 18.6%
Houston, Texas1,126,255
 12.3
 899,458
 10.8
Los Angeles/Orange County, California755,976
 8.3
 738,856
 8.9
Atlanta, Georgia755,323
 8.3
 713,931
 8.6
Phoenix, Arizona708,681
 7.7
 563,797
 6.8
Southeast Florida625,468
 6.9
 599,907
 7.2
Orlando, Florida596,007
 6.5
 549,039
 6.6
Denver, Colorado543,234
 6.0
 502,761
 6.0
Dallas, Texas519,833
 5.7
 508,134
 6.1
Charlotte, North Carolina429,640
 4.7
 401,879
 4.8
San Diego/Inland Empire, California392,158
 4.3
 371,186
 4.5
Raleigh, North Carolina371,827
 4.1
 293,961
 3.5
Tampa, Florida362,334
 4.0
 350,517
 4.2
Austin, Texas354,311
 3.9
 234,743
 2.8
Corpus Christi, Texas
 
 48,381
 0.6
Total$9,115,793
 100.0% $8,328,475
 100.0%
Results of Operations
Changes in revenues and expenses related to our operating properties from period to period are due primarily to the performance of stabilized properties in the portfolio, the lease-up of newly constructed properties, acquisitions, and dispositions. Where appropriate, comparisons of income and expense for communities included in continuing operations are made on a dollars-per-weighted average apartment home basis in order to adjust for such changes in the number of apartment homes owned during each period. Selected weighted averages for the years ended December 31 are as follows:
 
 2019 2018
Average monthly property revenue per apartment home$1,765
 $1,695
Annualized total property expenses per apartment home$7,546
 $7,322
Weighted average number of operating apartment homes owned 100%48,549
 46,925
Weighted average occupancy of operating apartment homes owned 100%96.0% 95.6%

Management considers property net operating income ("NOI") to be an appropriate supplemental measure of operating performance to net income because it reflects the operating performance of our communities without an allocation of corporate level property management overhead or general and administrative costs. We define NOI as total property income less property operating and maintenance expenses less real estate taxes. NOI is further detailed in the Property-Level NOI table as seen below. NOI is not defined by accounting principles generally accepted in the United States of America ("GAAP") and should not be considered an alternative to net income as an indication of our operating performance, should not be considered an alternative to net cash from operating activities as a measure of liquidity, and should not be considered an indication of cash available to fund cash needs. Additionally, NOI as disclosed by other REITs may not be comparable to our calculation.


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Reconciliations of net income to NOI for the year ended December 31, 2019 and 2018 are as follows:
(in thousands) 2019 2018
Net income $224,270 $160,694
Less: Fee and asset management income (8,696) (7,231)
Less: Interest and other income (3,090) (2,101)
Less: (Income)/loss on deferred compensation plans (21,694) 6,535
Plus: Property management expense 25,290
 25,581
Plus: Fee and asset management expense 5,759
 4,451
Plus: General and administrative expense 53,201
 50,735
Plus: Interest expense 80,706
 84,263
Plus: Depreciation and amortization expense 336,274
 300,946
Plus: Expense/(benefit) on deferred compensation plans 21,694
 (6,535)
Plus: Loss on early retirement of debt 11,995
 
Less: Gain on sale of operating properties (49,901) 
Less: Equity in income of joint ventures (14,783) (7,836)
Plus: Income tax expense 1,089
 1,424
Net operating income $662,114
 $610,926
 
Property-Level NOI (1)(2)
Property NOI, as reconciled above, is detailed further into the categories below for the year ended December 31, 2019 as compared to 2018:
 
 
Apartment
Homes at
 
Year Ended
December 31,
 Change
($ in thousands)12/31/2019 2019 2018 $ %
Property revenues:         
Same store communities41,986
 $856,066
 $825,606
 $30,460
 3.7%
Non-same store communities6,639
 147,259
 110,048
 37,211
 33.8
Development and lease-up communities2,443
 6,936
 1,751
 5,185
 *
Dispositions/other
 18,200
 17,100
 1,100
 6.4
Total property revenues51,068
 $1,028,461
 $954,505
 $73,956
 7.7%
Property expenses:         
Same store communities41,986
 $303,647
 $297,826
 $5,821
 2.0%
Non-same store communities6,639
 52,822
 38,611
 14,211
 36.8
Development and lease-up communities2,443
 2,685
 491
 2,194
 *
Dispositions/other
 7,193
 6,651
 542
 8.1
Total property expenses51,068
 $366,347
 $343,579
 $22,768
 6.6%
Property NOI:         
Same store communities41,986
 $552,419
 $527,780
 $24,639
 4.7%
Non-same store communities6,639
 94,437
 71,437
 23,000
 32.2
Development and lease-up communities2,443
 4,251
 1,260
 2,991
 *
Dispositions/other
 11,007
 10,449
 558
 5.3
Total property NOI51,068
 $662,114
 $610,926
 $51,188
 8.4%
* Not a meaningful percentage.

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(1)
For 2019, same store communities are communities we owned and were stabilized since January 1, 2018, excluding communities under redevelopment and properties held for sale. Non-same store communities are stabilized communities not owned or stabilized since January 1, 2018, including communities under redevelopment and excluding properties held for sale. We define communities under redevelopment as communities with capital expenditures that improve a community's cash flow and competitive position through extensive unit, exterior building, common area, and amenity upgrades. Management believes same store information is useful as it allows both management and investors to determine financial results over a particular period for the same set of communities. Development and lease-up communities are non-stabilized communities we have developed since January 1, 2018, excluding properties held for sale. Dispositions/other includes those communities disposed of or held for sale which are not classified as discontinued operations, non-multifamily rental properties, expenses related to land holdings not under active development, and other miscellaneous revenues and expenses.
Same Store Analysis
Year ended December 2019 compared to year ended December 2018
Same store property NOI increased approximately $24.6 million for the year ended December 31, 2019 as compared to the same period in 2018. The increase was due to an increase of approximately $30.5 million in same store property revenues for the year ended December 31, 2019, partially offset by an increase of approximately $5.8 million in same store property expenses for the year ended December 31, 2019, as compared to the same period in 2018.

The $30.5 million increase in same store property revenues for the year ended December 31, 2019, as compared to the same period in 2018, was primarily due to an increase of approximately $28.6 million in rental revenues primarily from a 3.4% increase in average rental rates and an approximately $1.9 million increase in income from our bulk internet rebilling program.

The $5.8 million increase in same store property expenses for the year ended December 31, 2019, as compared to the same period in 2018, was primarily due to higher salary expenses of approximately $3.9 million, higher property insurance expenses of approximately $1.0 million as a result of higher premiums, higher real estate taxes of approximately $0.7 million as a result of higher property valuations and tax rates at a number of our communities, and higher other miscellaneous property expenses of approximately $0.6 million. These increases were partially offset by an approximate $0.4 million decrease related to lower repair and maintenance costs as compared to the same period in 2018.
Non-same Store and Development and Lease-up Analysis
Property NOI from non-same store and development and lease-up communities increased approximately $26.0 million for the year ended December 31, 2019 as compared to the same period in 2018. The increase was due to an increase of approximately $42.4 million in revenues for the year ended December 31, 2019, partially offset by an increase of approximately $16.4 million in expenses for the year ended December 31, 2019, as compared to the same period in 2018. The increases in property revenues and expenses from our non-same store communities were primarily due to the acquisition of three operating properties in 2018 and four operating properties in 2019 and the stabilization of one operating property in 2018 and three operating properties in 2019. The increases in property revenues and expenses from our development and lease-up communities were primarily due to the timing of completion and partial lease-up of two properties during 2019. The following table details the changes, described above, relating to non-same store and development and lease-up NOI:

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  For the year ended December 31,
(in millions) 2019 compared to 2018
Property Revenues  
Revenues from non-same store stabilized properties $15.7
Revenues from acquisitions 19.3
Revenues from development and lease-up properties 5.2
Other 2.2
  $42.4
Property Expenses  
Expenses from non-same store stabilized properties $5.1
Expenses from acquisitions 8.2
Expenses from development and lease-up properties 2.2
Other 0.9
  $16.4
Property NOI  
NOI from non-same store stabilized properties $10.6
NOI from acquisitions 11.1
NOI from development and lease-up properties 3.0
Other 1.3
  $26.0
Dispositions/Other Property Analysis
Dispositions/other property NOI increased approximately $0.6 million for the year ended December 31, 2019 as compared to the same period in 2018. The increase was primarily due to the receipt of business interruption insurance proceeds.

Non-Property Income
 
 
Year Ended
December 31,
 Change
($ in thousands)2019 2018 $ %
Fee and asset management$8,696
 $7,231
 $1,465
 20.3%
Interest and other income3,090
 2,101
 989
 47.1
Income (loss) on deferred compensation plans21,694
 (6,535) 28,229
 *
Total non-property income$33,480
 $2,797
 $30,683
 1,097.0%
* Not a meaningful percentage
Fee and asset management income from property management, asset management, construction, and development activities at our joint ventures and our third-party construction projects increased approximately $1.5 million for the year ended December 31, 2019 as compared to 2018. The increase for 2019 as compared to 2018 was primarily due to higher fees earned on capital projects at Fund communities, an increase in third-party construction activity, and higher property management fees.
Interest and other income increased approximately $1.0 million for the year ended December 31, 2019, as compared to 2018. The increase was primarily related to higher interest income earned on investments in cash and cash equivalents due to maintaining higher average cash balances in 2019, as compared to 2018.
Our deferred compensation plans recognized income of approximately $21.7 million in 2019 and a loss of approximately $6.5 million in 2018. The changes were related to the performance of the investments held in deferred compensation plans for participants and were directly offset by the expense (benefit) related to these plans, as discussed below.

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Other Expenses
 
Year Ended
December 31,
 Change
($ in thousands)2019 2018 $ %
Property management$25,290
 $25,581
 $(291) (1.1)%
Fee and asset management5,759
 4,451
 1,308
 29.4
General and administrative53,201
 50,735
 2,466
 4.9
Interest80,706
 84,263
 (3,557) (4.2)
Depreciation and amortization336,274
 300,946
 35,328
 11.7
Expense (benefit) on deferred compensation plans21,694
 (6,535) 28,229
 *
Total other expenses$522,924
 $459,441
 $63,483
 13.8 %
* Not a meaningful percentage
Property management expenses, which primarily represent regional supervision and accounting costs related to property operations, decreased approximately $0.3 million for the year ended December 31, 2019 as compared to 2018 . The decrease was primarily related to lower discretionary expenses and lower incentive compensation expenses due to a decrease in amortization costs as a result of having substantially three-year awards outstanding in 2019 as compared to having three and five year awards in 2018. The decrease was partially offset by higher other compensation related costs. Property management expenses were 2.5% and 2.7% of total property revenues for the years ended December 31, 2019 and 2018, respectively.
Fee and asset management expense from property management, asset management, construction, and development activities at our joint ventures and our third-party construction projects increased approximately $1.3 million for the year ended December 31, 2019 as compared to 2018. The increase was primarily due to higher expenses incurred as a result of an increase in capital projects at Fund communities and an increase in third-party construction activity.
General and administrative expenses increased approximately $2.5 million during the year ended December 31, 2019 as compared to 2018. The increase was primarily due to higher compensation-related costs, professional fees, information technology costs, and other corporate initiative costs. Excluding deferred compensation plans, general and administrative expenses were 5.1% and 5.3% of total revenues for the years ended December 31, 2019 and 2018, respectively.
Interest expense decreased approximately $3.6 million for the year ended December 31, 2019 as compared to 2018. The decrease was primarily due to the repayment of $380 million of secured conventional mortgage notes with a weighted average interest rate of 4.43% in October 2018, the repayment of approximately $439.3 million of secured conventional mortgage debt with a weighted average interest rate of 5.2% in the first quarter of 2019, the early redemption of our $250 million, 4.78% senior unsecured notes due 2021, and the prepayment of an approximately $45.3 million, 4.38% secured conventional mortgage note in October 2019. The decrease was partially offset by the issuance of a $100 million unsecured floating rate term loan in September 2018; the issuance of $400 million, 3.74% senior unsecured notes in October 2018; the issuance of $600 million, 3.67% senior unsecured notes in June 2019; and the issuance of $300 million, 3.35% senior unsecured notes in October 2019. The decrease was further offset by an increase in interest expense recognized on our unsecured credit facility due to having higher balances outstanding in 2019 as compared to 2018.
Depreciation and amortization expense increased approximately $35.3 million for the year ended December 31, 2019 as compared to 2018. The increase was primarily due to the acquisition of one operating property in September 2018 and four operating properties in 2019, the completion of units in our development pipeline, the completion of repositions and the partial completion of redevelopments during 2019 and 2018.
Our deferred compensation plans incurred an expense of approximately $21.7 million in 2019 and a benefit of approximately $6.5 million in 2018. These changes were related to the performance of the investments held in deferred compensation plans for participants and were directly offset by the income (loss) related to these plans, as discussed in the non-property income section above.

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Other
 
Year Ended
December 31,
 Change
(in thousands)2019 2018 $
Loss on early retirement of debt$(11,995) $
 $(11,995)
Gain on sale of operating properties$49,901
 $
 $49,901
Equity in income of joint ventures14,783
 7,836
 6,947
Income tax expense(1,089) (1,424) 335
The loss on early retirement of debt for the year ended December 31, 2019 related to the early redemption of our $250 million, 4.78% Senior Notes due 2021 and the prepayment of a $45.3 million, 4.38% secured conventional mortgage note due 2045.
Gain on sale of operating properties for the year ended December 31, 2019 was due to the sale of two operating properties located in Corpus Christi, Texas in the fourth quarter.
Equity in income of joint ventures increased approximately $6.9 million for the year ended December 31, 2019 as compared to 2018. The increase was primarily due to the recognition of a $6.2 million proportionate share of the gain related to the sale of one operating property by one of the Funds in December 2019 as well as increases in earnings from the operating properties owned by the Funds.
Income tax expense decreased approximately $0.3 million for the year ended December 31, 2019, as compared to 2018. The decrease was primarily due to lower state income taxes, which included an approximate $0.1 million state income tax refund. The decrease was partially offset by an increase in taxable income related to our third-party construction activities conducted in a taxable REIT subsidiary.
Funds from Operations (“FFO”) and Adjusted FFO ("AFFO")
Management considers FFO and AFFO to be appropriate supplementary measures of the financial performance of an equity REIT. The National Association of Real Estate Investment Trusts (“NAREIT”) currently defines FFO as net income (computed in accordance with GAAP), excluding gains (or losses) associated with the sale of previously depreciated operating properties, real estate depreciation and amortization, impairments of depreciable assets, and adjustments for unconsolidated joint ventures to reflect FFO on the same basis. Our calculation of diluted FFO also assumes conversion of all potentially dilutive securities, including certain non-controlling interests, which are convertible into common shares. We consider FFO to be an appropriate supplemental measure of operating performance because, by excluding gains or losses on dispositions of operating properties and depreciation, FFO can assist in the comparison of the operating performance of a company’s real estate investments between periods or to different companies.
AFFO is calculated utilizing FFO less recurring capitalized expenditures which are necessary to help preserve the value of and maintain the functionality at our communities. We also consider AFFO to be a useful supplemental measure because it is frequently used by analysts and investors to evaluate a REIT's operating performance between periods or different companies. Our definition of recurring capital expenditures may differ from other REITs, and there can be no assurance our basis for computing this measure is comparable to other REITs.
To facilitate a clear understanding of our consolidated historical operating results, we believe FFO and AFFO should be examined in conjunction with net income attributable to common shareholders as presented in the consolidated statements of income and comprehensive income and data included elsewhere in this report. FFO and AFFO are not defined by GAAP and should not be considered alternatives to net income attributable to common shareholders as an indication of our operating performance. Additionally, FFO and AFFO as disclosed by other REITs may not be comparable to our calculation.

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Reconciliations of net income attributable to common shareholders to FFO and AFFO for the years ended December 31 are as follows:
 
($ in thousands)2019 2018
Funds from operations   
Net income attributable to common shareholders (1)
$219,623
 $156,128
Real estate depreciation and amortization328,045
 294,283
Adjustments for unconsolidated joint ventures8,987
 8,976
Gain on sale of operating properties(49,901) 
Gain on sale of unconsolidated joint venture operating property(6,204) 
Income allocated to non-controlling interests4,838
 4,595
Funds from operations$505,388
 $463,982
    
Less: recurring capitalized expenditures(72,172) (72,296)
Adjusted funds from operations$433,216
 $391,686
    
Weighted average shares – basic98,460
 95,208
Incremental shares issuable from assumed conversion of:   
Common share options and awards granted119
 158
Common units1,753
 1,835
Weighted average shares – diluted100,332
 97,201
 
(1)Net income attributable to common shareholders for the year ended December 31, 2019 included an approximate $12 million loss on early retirement of debt related to the redemption of our 4.78% Senior Notes due 2021 and the prepayment of a 4.38% secured conventional mortgage note due 2045.
Liquidity and Capital Resources
Financial Condition and Sources of Liquidity
We intend to maintain a strong balance sheet and preserve our financial flexibility, which we believe should enhance our ability to identify and capitalize on investment opportunities as they become available. We intend to maintain what management believes is a conservative capital structure by:
 
extending and sequencing the maturity dates of our debt where practicable;
managing interest rate exposure using what management believes to be prudent levels of fixed and floating rate debt;
maintaining what management believes to be conservative coverage ratios; and
using what management believes to be a prudent combination of debt and equity.
Our interest expense coverage ratio, net of capitalized interest, was approximately 7.3 and 6.4 times for the years ended December 31, 2019 and 2018, respectively. This ratio is a method for calculating the amount of operating cash flows available to cover interest expense and is calculated by dividing interest expense for the period into the sum of property revenues and expenses, non-property income, and other expenses after adding back depreciation, amortization, and interest expense. All of our properties were unencumbered at December 31, 2019 and approximately 89.6% and 80.0% of our properties were unencumbered at December 31, 2018 and 2017, respectively. Our weighted average maturity of debt was approximately 8.9 years at December 31, 2019.
We also intend to strengthen our capital and liquidity positions by continuing to focus on our core fundamentals, which currently are generating positive cash flows from operations, maintaining appropriate debt levels and leverage ratios, and controlling overhead costs.
Our primary sources of liquidity are cash and cash equivalents on hand and cash flow generated from operations. Other sources may include one or more of the following: availability under our unsecured credit facility, the use of debt and equity offerings under our automatic shelf registration statement, proceeds from property dispositions, equity issued from our ATM programs, and other unsecured borrowings or secured mortgages. We believe our liquidity and financial condition are sufficient to meet all of our reasonably anticipated cash needs during 2020 including:

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normal recurring operating expenses;
current debt service requirements, including debt maturities;
recurring capital expenditures;
reposition expenditures;
funding of property developments, redevelopments, acquisitions, and joint venture investments; and
the minimum dividend payments required to maintain our REIT qualification under the Code.
Factors which could increase or decrease our future liquidity include but are not limited to volatility in capital and credit markets, changes in rent control or rent stabilization laws, sources of financing, the minimum REIT dividend requirements, our ability to complete asset purchases, sales, or developments, the effect our debt level and changes in credit ratings could have on our cost of funds, and our ability to access capital markets.
Cash Flows
The following is a discussion of our cash flows for the years ended December 31, 2019 and 2018.
Net cash from operating activities was approximately $555.6 million during the year ended December 31, 2019 as compared to approximately $503.7 million during the year ended December 31, 2018. The increase was primarily due to growth attributable to our same store, non-same store communities, and development and lease-up communities and changes in our operating accounts. These increases were partially offset by cash outflows related to the settlement of our forward interest rate swaps in 2019 as compared to cash inflows received in 2018. See further discussions of our 2019 operations as compared to 2018 in "Results of Operations."
Net cash used in investing activities during the year ended December 31, 2019 totaled approximately $792.4 million as compared to $640.9 million during the year ended December 31, 2018. Cash outflows during 2019 primarily related to property development and capital improvements of approximately $407.6 million, the acquisition of four operating properties for approximately $436.3 million, and increases in non-real estate assets of $17.2 million. These outflows were partially offset by net proceeds from the sale of two operating properties of approximately $67.6 million and a net decrease in notes receivable of $1.4 million. Cash outflows during 2018 primarily related to property development and capital improvements of approximately $359.2 million, the acquisition of three operating properties for approximately $290.0 million, and increases in non-real estate assets of $14.5 million. These outflows were partially offset by the sale of land of approximately $11.3 million and a net decrease in notes receivable of $9.5 million. The increase in property development and capital improvements for 2019, as compared to the same period in 2018, was primarily due to the acquisition of three development properties in 2019 as compared to one development property in 2018, the timing and completion of five consolidated operating properties in 2018 and 2019, and the completion of repositions at several of our operating properties. The property development and capital improvements during 2019 and 2018, included the following:
  December 31,
(in millions) 2019 2018
Expenditures for new development, including land $217.5
 $177.9
Capital expenditures 80.9
 83.6
Reposition expenditures 66.7
 49.8
Capitalized interest, real estate taxes, and other capitalized indirect costs 26.6
 24.3
Redevelopment expenditures 15.9
 23.6
     Total $407.6
 $359.2
Net cash from financing activities totaled approximately $220.7 million during the year ended December 31, 2019 as compared to net cash used of approximately $197.0 million during the year ended December 31, 2018. Cash inflows during 2019 primarily related to net proceeds of approximately $890.0 million from the issuance of $600.0 million senior unsecured notes in June 2019 and $300.0 million senior unsecured notes in October 2019, as well as net proceeds of approximately $353.2 million from the issuance of approximately 3.4 million common shares through an underwritten equity offering completed in February 2019 and approximately 0.2 million common shares through our 2017 ATM program. We also had net proceeds of $44.0 million of borrowings from our unsecured line of credit. These cash inflows were partially offset by the repayment of approximately $439.3 million of secured conventional mortgage debt in the first quarter of 2019, and the early redemption of our $250 million unsecured notes payable due 2021 and the prepayment of the approximate $45.3 million secured conventional mortgage note due 2045 and associated prepayment penalties in the fourth quarter of 2019. We also used approximately $317.3 million to pay

32


distributions to common shareholders and non-controlling interest holders. Cash outflows during 2018 primarily related to the repayment of approximately $380.0 million variable and fixed rate secured conventional mortgage notes, approximately $298.0 million to pay distributions to common shareholders and non-controlling interest holders, and approximately $14.7 million for the repurchase of our common shares and redemption of units. These cash outflows during 2018 were partially offset by net proceeds of approximately $495.5 million from the issuance of $400.0 million senior unsecured notes and the issuance of a $100.0 million unsecured floating-rate term loan.
Financial Flexibility

In March 2019, we amended and restated our $600 million unsecured credit facility to, among other things, extend the maturity date from August 2019 to March 2023, with two options to further extend the facility at our election for two additional six-month periods, and increase the facility from $600 million to $900 million, which may be expanded three times by up to an additional $500 million upon the satisfaction of certain conditions. The interest rate on our unsecured credit facility is based upon the London Interbank Offered Rate ("LIBOR") plus a margin which is subject to change as our credit ratings change. Advances under our credit facility may be priced at the scheduled rates, or we may enter into bid rate loans with participating banks at rates below the scheduled rates. These bid rate loans have terms of 180 days or less and may not exceed the lesser of $450 million or the remaining amount available under our credit facility. Our credit facility is subject to customary financial covenants and limitations. We believe we are in compliance with all such financial covenants and limitations as of December 31, 2019 and through the date of this filing.
Our credit facility provides us with the ability to issue up to $50.0 million in letters of credit. While our issuance of letters of credit does not increase our borrowings outstanding under our credit facility, it does reduce the amount available. At December 31, 2019, we had approximately $44.0 million of borrowings outstanding on our $900.0 million credit facility and we had outstanding letters of credit totaling approximately $8.9 million, leaving approximately $847.1 million available under our credit facility.

We currently have an automatic shelf registration statement which allows us to offer common shares, preferred shares, debt securities, or warrants, and our Amended and Restated Declaration of Trust provides we may issue up to 185 million shares of beneficial interest, consisting of 175 million common shares and 10 million preferred shares. At December 31, 2019, we had approximately 97.2 million common shares outstanding, net of treasury shares and shares held in our deferred compensation arrangements, and no preferred shares outstanding.
In May 2017, we created an at-the market ("ATM") share offering program through which we can, but have no obligation to, sell common shares having an aggregate offering price of up to $315.3 million (the "2017 ATM program"), in amounts and at times as we determine, into the existing trading market at current market prices as well as through negotiated transactions. Actual sales from time to time may depend on a variety of factors including, among others, market conditions, the trading price of our common shares, and determinations by management of the appropriate sources of funding for us. The proceeds from the sale of our common shares under the 2017 ATM program are intended to be used for general corporate purposes, which may include reducing future borrowings under our unsecured line of credit, the repayment of other indebtedness, the redemption or other repurchase of outstanding debt or equity securities, funding for development activities, and financing for acquisitions. As of the date of this filing, we had common shares having an aggregate offering price of up to $287.7 million remaining available for sale under the 2017 ATM program. No additional shares under the 2017 ATM program were sold subsequent to December 31, 2019 through the date of this filing.
We believe our ability to access capital markets is enhanced by our senior unsecured debt ratings by Moody’s, Fitch, and Standard and Poor's, which were A3 with stable outlook, A- with stable outlook, and A- with stable outlook, respectively, as of December 31, 2019. We believe our ability to access capital markets is also enhanced by our ability to borrow on a secured basis from various institutions including banks, Fannie Mae, Freddie Mac, or life insurance companies. However, we may not be able to maintain our current credit ratings and may not be able to borrow on a secured or unsecured basis in the future.
Future Cash Requirements and Contractual Obligations
One of our principal long-term liquidity requirements includes the repayment of maturing debt, including any future borrowings under our unsecured credit facility. As of the date of this filing, we did not have any debt maturing through the year ending December 31, 2021. See Note 9, “Notes Payable,” in the notes to Consolidated Financial Statements for further discussion of scheduled maturities.
We estimate the additional cost to complete the construction of the seven consolidated projects to be approximately $358.6 million. Of this amount, we expect to incur costs between approximately $220 million and $240 million during 2020 and to incur the remaining costs during 2021. Additionally, we expect to incur costs between approximately $65 million and $75 million related to the start of new development activities, between approximately $52 million and $56 million of repositions and revenue enhancing

33


expenditures, between approximately $16 million and $20 million in redevelopment expenditures and between approximately $72 million and $76 million of additional recurring capital expenditures.
We anticipate meeting our near-term liquidity requirements through a combination of one or more of the following: cash flows generated from operations, draws on our unsecured credit facility, the use of debt and equity offerings under our automatic shelf registration statement, proceeds from property dispositions, equity issued from our 2017 ATM program, other unsecured borrowings, or secured mortgages. We continue to evaluate our operating properties and land development portfolio and plan to continue our practice of selective dispositions as market conditions warrant and opportunities arise.
As a REIT, we are subject to a number of organizational and operational requirements, including a requirement to distribute current dividends to our shareholders equal to a minimum of 90% of our annual taxable income. In order to reduce the amount of income taxes, our general policy is to distribute at least 100% of our taxable income. In December 2019, we announced our Board of Trust Managers had declared a quarterly dividend of $0.80 per common share to our common shareholders of record as of December 16, 2019. This dividend was subsequently paid on January 17, 2020 and we paid equivalent amounts per unit to holders of common operating partnership units. When aggregated with previous 2019 dividends, this distribution to common shareholders and holders of the common operating partnership units equates to an annual dividend rate of $3.20 per share or unit for the year ended December 31, 2019.
In the first quarter of 2020, the Company's Board of Trust Managers declared a first quarter dividend of $0.83 per common share to our common shareholders of record as of March 31, 2020. Future dividend payments are paid at the discretion of the Board of Trust Managers and depend on cash flows generated from operations, the Company's financial condition and capital requirements, distribution requirements under the REIT provisions of the Code and other factors which may be deemed relevant by our Board of Trust Managers. Assuming similar dividend distributions for the remainder of 2020, our annualized dividend rate for 2020 would be $3.32 as compared to a dividend rate of $3.20 in 2019.
The following table summarizes our known contractual cash obligations as of December 31, 2019:
 
(in millions)Total 2020 2021 2022 2023 2024 Thereafter
Debt maturities (1)
$2,524.1
 $(3.1) $(3.1) $447.0
 $247.9
 $542.6
 $1,292.8
Interest payments (2)
790.6
 91.1
 91.1
 87.9
 71.5
 52.2
 396.8
Non-cancelable lease payments17.1
 3.4
 3.2
 2.9
 2.7

2.8
 2.1
 $3,331.8
 $91.4
 $91.2
 $537.8
 $322.1
 $597.6
 $1,691.7
(1)Includes all available extension options, amortization of debt discounts and debt issuance costs, net of scheduled principal payments.
(2)Includes contractual interest payments for our senior unsecured notes and all available extension options. The interest payments on our unsecured term loan with floating interest rates were calculated based on the interest rates in effect as of December 31, 2019.
Off-Balance Sheet Arrangements
The joint ventures in which we have an interest have been funded in part with secured, third-party debt. At December 31, 2019, our unconsolidated joint ventures had outstanding debt of approximately $496.9 million. As of December 31, 2019, we had no outstanding guarantees related to the loans of our unconsolidated joint ventures.
Inflation
Substantially all of our apartment leases are for a term generally ranging from twelve to fifteen months. In an inflationary environment, we may realize increased rents at the commencement of new leases or upon the renewal of existing leases. We believe the short-term nature of our leases generally minimizes our risk from the adverse effects of inflation.
Critical Accounting Policies
The preparation of our financial statements in conformity with GAAP requires management to make certain estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities, the disclosures of contingent assets and liabilities at the balance sheet date, and the amounts of revenues and expenses recognized during the reporting period. These estimates are based on historical experience and other assumptions believed to be reasonable under the circumstances. The following is a discussion of our critical accounting policies. For a discussion of all of our significant accounting policies, see Note 2, "Summary of Significant Accounting Policies and Recent Accounting Pronouncements," to the accompanying consolidated financial statements.
Valuation of Assets. Long-lived assets are reviewed for impairment annually or whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. Impairment may exist if estimated future undiscounted cash flows associated with long-lived assets are not sufficient to recover the carrying value of such assets. We consider projected future

34


undiscounted cash flows, trends, strategic decisions regarding future development plans, and other factors in our assessment of whether impairment conditions exist. While we believe our estimates of future cash flows are reasonable, different assumptions regarding a number of factors, including market rents, economic conditions, and occupancies, could significantly affect these estimates. When impairment exists, the long-lived asset is adjusted to its fair value. In estimating fair value, management uses appraisals, management estimates, and discounted cash flow calculations which utilize inputs from a marketplace participant’s perspective. In addition, we evaluate our equity investments in joint ventures and if we believe there is an other than temporary decline in market value of our investment below our carrying value, we will record an impairment charge.
The value of our properties under development depends on market conditions, including estimates of the project start date as well as estimates of demand for multifamily communities. We have reviewed market trends and other marketplace information and have incorporated this information as well as our current outlook into the assumptions we use in our impairment analyses. Due to the judgment and assumptions applied in the impairment analyses, it is possible actual results could differ substantially from those estimated.
We believe the carrying value of our operating real estate assets, properties under development, and land is currently recoverable. However, if market conditions deteriorate or if changes in our development strategy significantly affect any key assumptions used in our fair value estimates, we may need to take material charges in future periods for impairments related to existing assets. Any such material non-cash charges could have an adverse effect on our consolidated financial position and results of operations.
Recent Accounting Pronouncements
See Note 2, "Summary of Significant Accounting Policies and Recent Accounting Pronouncements" in the notes to Consolidated Financial Statements for further discussion of recent accounting pronouncements issued during the year ended December 31, 2019.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
We believe the primary market risk we face is interest rate risk. We seek to mitigate this risk by following established risk management policies, which includes (i) maintaining prudent levels of fixed and floating rate debt; and (ii) extending and sequencing the maturity dates of our debt where practicable. We also periodically use derivative financial instruments, primarily interest rate swaps with major financial institutions, to manage a portion of this risk. We do not utilize derivative financial instruments for trading or speculative purposes. The table below summarizes our debt as of December 31, 2019 and 2018:

 December 31, 2019 December 31, 2018
 
Amount
(in  millions)
 
Weighted
Average
Maturity
(in years)
 
Weighted
Average
Interest
Rate
 
% Of
Total
 
Amount
(in  millions)
 
Weighted
Average
Maturity
(in years)
 
Weighted
Average
Interest
Rate
 
% Of
Total
Fixed rate debt$2,380.4
 9.3
 3.8% 94.3% $2,222.0
 5.0
 4.3% 95.7%
Variable rate debt143.7
 2.7
 2.7% 5.7% 99.6
 3.0
 3.3% 4.3%
In order to manage interest rate exposure, we have utilized interest rate swap agreements to protect against unfavorable interest rate changes relating to forecasted debt transactions. These swaps, which are settled upon issuance of the related debt, are designated as cash flow hedges and the gains and/or losses are deferred in other comprehensive income and recognized as an adjustment to interest expense over the same period the hedged interest payments affect earnings. In 2019, we settled all remaining outstanding forward interest rate swaps with a total notional value of $300 million resulting in a net cash payment of approximately $20.4 million. In 2018, we settled five forward interest rate swaps with an aggregate notional amount of $400 million, in connection with the issuance of $400 million senior unsecured debt in October 2018, which resulted in a cash receipt of approximately $15.9 million. As of December 31, 2019, we had no hedges outstanding.
At December 31, 2019, we had approximately $44.0 million of borrowings outstanding under our unsecured credit facility and did not have any amount outstanding at December 31, 2018. At December 31, 2019 and 2018, we also had a term loan of approximately $99.7 million and $99.6 million, respectively. If interest rates on the variable rate debt listed in the table above would have been 100 basis points higher throughout 2019 and 2018, our annual interest costs would have increased by approximately $1.4 million and $1.0 million, respectively.
For fixed rate debt, interest rate changes affect the fair market value but do not impact net income attributable to common shareholders or cash flows. Holding other variables constant, if interest rates would have been 100 basis points higher as of December 31, 2019, the fair value of our fixed rate debt would have decreased by approximately $171.4 million.

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Item 8. Financial Statements and Supplementary Data
Our response to this item is included in a separate section at the end of this report beginning on page F-1.
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
None.
Item 9A. Controls and Procedures
Evaluation of Disclosure Controls and Procedures. We carried out an evaluation, under the supervision and with the participation of our management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report pursuant to Securities Exchange Act ("Exchange Act") Rules 13a-15(e) and 15d-15(e). Based on the evaluation, the Chief Executive Officer and Chief Financial Officer concluded the disclosure controls and procedures as of the end of the period covered by this report are effective to ensure information required to be disclosed by us in our Exchange Act filings is accurately recorded, processed, summarized, and reported within the periods specified in the Securities and Exchange Commission's rules and forms and is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.
Changes in Internal Controls. There were no changes in our internal control over financial reporting (identified in connection with the evaluation required by paragraph (d) in Rules 13a-15 and 15d-15 under the Exchange Act) during our most recent fiscal quarter which have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

36


Management’s Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rule 13a-15(f) and 15d-15(f) promulgated under the Securities Exchange Act of 1934 as follows:
A process designed by, or under the supervision of, the Company’s principal executive and principal financial officers, or persons performing similar functions, and effected by the Company's board of trust managers, management, and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that:
 
Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;
Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and receipts and expenditures of the Company are being made only in accordance with authorizations of management and Board of Trust Managers of the Company; and
Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on the financial statements.
Management assessed the effectiveness of our internal control over financial reporting as of December 31, 2019. In making this assessment, management used the criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.
Based on our assessment, management concluded our internal control over financial reporting is effective as of December 31, 2019.
Deloitte & Touche LLP, an independent registered public accounting firm, has issued an attestation report regarding the effectiveness of our internal control over financial reporting, which is included herein.

February 20, 2020

37



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and Board of Trust Managers of Camden Property Trust

Opinion on Internal Control over Financial Reporting
    
We have audited the internal control over financial reporting of Camden Property Trust and subsidiaries (the “Company”) as of December 31, 2019, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2019, based on criteria established in Internal Control - Integrated Framework (2013) issued by COSO.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, 2019, of the Company and our report dated February 20, 2020, expressed an unqualified opinion on those financial statements.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ DELOITTE & TOUCHE LLP
 
Houston, Texas
February 20, 2020


38


Item 9B. Other Information
None.
PART III
Item 10. Directors, Executive Officers, and Corporate Governance
Information with respect to this Item 10 is incorporated by reference from our Proxy Statement, which we expect to file on or about March 24, 2020 in connection with the Annual Meeting of Shareholders to be held on or about May 13, 2020.
Item 11. Executive Compensation
Information with respect to this Item 11 is incorporated by reference from our Proxy Statement, which we expect to file on or about March 24, 2020 in connection with the Annual Meeting of Shareholders to be held on or about May 13, 2020.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters
Information with respect to this Item 12 is incorporated by reference from our Proxy Statement, which we expect to file on or about March 24, 2020 in connection with the Annual Meeting of Shareholders to be held on or about May 13, 2020.
Item 13. Certain Relationships and Related Transactions, and Director Independence
Information with respect to this Item 13 is incorporated herein by reference from our Proxy Statement, which we expect to file on or about March 24, 2020 in connection with the Annual Meeting of Shareholders to be held on or about May 13, 2020.
Item 14. Principal Accounting Fees and Services
Information with respect to this Item 14 is incorporated herein by reference from our Proxy Statement, which we expect to file on or about March 24, 2020 in connection with the Annual Meeting of Shareholders to be held on or about May 13, 2020.

PART IV

Item 15. Exhibits and Financial Statement Schedules
The following documents are filed as part of this report:
 
All other schedules have been omitted since the required information is presented in the financial statements and the related notes or is not applicable.

39


(3) Index to Exhibits:
The following exhibits are filed as part of or incorporated by reference into this report:
Exhibit No. Description Filed Herewith or Incorporated Herein by Reference (1)
   
3.1 Amended and Restated Declaration of Trust of Camden Property Trust (2) Exhibit 3.1 to Form 10-K for the year ended December 31, 1993 - Rule 311-P
   
 Amendment to the Amended and Restated Declaration of Trust of Camden Property Trust Exhibit 3.1 to Form 10-Q for the quarter ended June 30, 1997
     
 Amendment to the Amended and Restated Declaration of Trust of Camden Property Trust Exhibit 3.1 to Form 8-K filed on May 14, 2012
   
 Third Amended and Restated Bylaws of Camden Property Trust Exhibit 99.1 to Form 8-K filed on March 12, 2013
   
 Fourth Amended and Restated Bylaws of Camden Property Trust Exhibit 3.1 to Form 8-K filed on July 25, 2019
     
4.1 Specimen certificate for Common Shares of Beneficial Interest (2) Form S-11 filed on September 15, 1993 (Registration No. 33-68736) - Rule 311-P
     
 Indenture for Senior Debt Securities dated as of February 11, 2003 between Camden Property Trust and U. S. Bank National Association, as successor to SunTrust Bank, as Trustee Exhibit 4.1 to Form S-3 filed on February 12, 2003 (Registration No. 333-103119)
     
 First Supplemental Indenture dated as of May 4, 2007 between the Company and U.S. Bank National Association, as successor to SunTrust Bank, as Trustee Exhibit 4.2 to Form 8-K filed on May 7, 2007
     
 Second Supplemental Indenture dated as of June 3, 2011 between the Company and U.S. Bank National Association, as successor to SunTrust Bank, as Trustee Exhibit 4.3 to Form 8-K filed on June 3, 2011
     
 Third Supplemental Indenture dated as of October 4, 2018 between the Company and U.S. Bank National Association, as successor to SunTrust Bank, as Trustee Exhibit 4.4 to Form 8-K filed on October 4, 2018
     
 Registration Rights Agreement dated as of February 28, 2005 between Camden Property Trust and the holders named therein Form S-4 filed on November 24, 2004 (Registration No. 333-120733)
     
 Form of Camden Property Trust 2.95% Note due 2022 Exhibit 4.4 to Form 8-K filed on December 7, 2012
     
 Form of Camden Property Trust 4.875% Note due 2023 Exhibit 4.5 to Form 8-K filed on June 3, 2011
     
 Form of Camden Property Trust 4.250% Note due 2024 Exhibit 4.1 to Form 8-K filed on December 2, 2013
     
 Form of Camden Property Trust 3.50% Note due 2024 Exhibit 4.1 to Form 8-K filed on September 12, 2014
     
 Form of Camden Property Trust 4.100% Note due 2028 Exhibit 4.5 to Form 8-K filed on October 4, 2018
     
 Form of Camden Property Trust 3.150% Note due 2029 Exhibit 4.5 to Form 8-K filed on June 17, 2019
     
 Form of Camden Property Trust 3.350% Note due 2049 Exhibit 4.5 to Form 8-K filed on October 7, 2019
     
10.1 Form of Indemnification Agreement between Camden Property Trust and certain of its trust managers and executive officers (2) Form S-11 filed on July 9, 1993 (Registration No. 33-63588) - Rule 311-P
     
 Second Amended and Restated Employment Agreement dated July 11, 2003 between Camden Property Trust and Richard J. Campo Exhibit 10.1 to Form 10-Q for the quarter ended June 30, 2003
     

40


Exhibit No. Description Filed Herewith or Incorporated Herein by Reference (1)
 Second Amended and Restated Employment Agreement dated July 11, 2003 between Camden Property Trust and D. Keith Oden Exhibit 10.2 to Form 10-Q for the quarter ended June 30, 2003
     
 Form of First Amendment to Second Amended and Restated Employment Agreements, effective as of January 1, 2008, between Camden Property Trust and each of Richard J. Campo and D. Keith Oden Exhibit 99.1 to Form 8-K filed on November 30, 2007
     
 Second Amendment to Second Amended and Restated Employment Agreement, dated as of March 14, 2008, between Camden Property Trust and D. Keith Oden Exhibit 99.1 to Form 8-K filed on March 18, 2008
     
 Form of Employment Agreement by and between Camden Property Trust and certain senior executive officers Exhibit 10.13 to Form 10-K for the year ended December 31, 1996
     
 Second Amended and Restated Employment Agreement, dated November 3, 2008, between Camden Property Trust and H. Malcolm Stewart Exhibit 99.1 to Form 8-K filed on November 4, 2008
     
 
Second Amended and Restated Camden Property Trust Key Employee Share Option Plan (KEYSOP), effective as of January 1, 2008
 Exhibit 99.5 to Form 8-K filed on November 30, 2007
     
 Amendment No. 1 to Second Amended and Restated Camden Property Trust Key Employee Share Option Plan, effective as of January 1, 2008 Exhibit 99.1 to Form 8-K filed on December 8, 2008
     
 Form of Amended and Restated Master Exchange Agreement between Camden Property Trust and certain key employees Exhibit 10.7 to Form 10-K for the year ended December 31, 2003
     
 Form of Amended and Restated Master Exchange Agreement between Camden Property Trust and certain trust managers Exhibit 10.8 to Form 10-K for the year ended December 31, 2003
     
 Form of Amended and Restated Master Exchange Agreement between Camden Property Trust and certain key employees Exhibit 10.9 to Form 10-K for the year ended December 31, 2003
     
 Form of Master Exchange Agreement between Camden Property Trust and certain trust managers Exhibit 10.10 to Form 10-K for the year ended December 31, 2003
     
 Form of Amendment No. 1 to Amended and Restated Master Exchange Agreement (Trust Managers) effective November 27, 2007 Exhibit 10.1 to Form 10-Q filed on July 30, 2010
     
 Form of Amendment No. 1 to Amended and Restated Master Exchange Agreement (Key Employees) effective November 27, 2007 Exhibit 10.2 to Form 10-Q filed on July 30, 2010
     
 Form of Third Amended and Restated Agreement of Limited Partnership of Camden Operating, L.P. Exhibit 10.1 to Form S-4 filed on February 26, 1997 (Registration No. 333-22411)
     
 First Amendment to Third Amended and Restated Agreement of Limited Partnership of Camden Operating, L.P., dated as of February 23, 1999 Exhibit 99.2 to Form 8-K filed on March 10, 1999
     
 Form of Second Amendment to Third Amended and Restated Agreement of Limited Partnership of Camden Operating, L.P., dated as of August 13, 1999 Exhibit 10.15 to Form 10-K for the year ended December 31, 1999
     
 Form of Third Amendment to Third Amended and Restated Agreement of Limited Partnership of Camden Operating, L.P., dated as of September 7, 1999 Exhibit 10.16 to Form 10-K for the year ended December 31, 1999
   

41


Exhibit No. Description Filed Herewith or Incorporated Herein by Reference (1)
 Form of Fourth Amendment to Third Amended and Restated Agreement of Limited Partnership of Camden Operating, L.P., dated as of January 7, 2000 Exhibit 10.17 to Form 10-K for the year ended December 31, 1999
     
 Form of Amendment to Third Amended and Restated Agreement of Limited Partnership of Camden Operating, L.P., dated as of December 1, 2003 Exhibit 10.19 to Form 10-K for the year ended December 31, 2003
   
 Amended and Restated 1993 Share Incentive Plan of Camden Property Trust Exhibit 10.18 to Form 10-K for the year ended December 31, 1999
     
 Amended and Restated Camden Property Trust 1999 Employee Share Purchase Plan Exhibit 10.1 to Form 10-Q for the quarter ended June 30, 2014
   
 Amended and Restated 2002 Share Incentive Plan of Camden Property Trust Exhibit 10.1 to Form 10-Q for the quarter ended March 31, 2002
     
 Camden Property Trust 2018 Employee Share Purchase Plan Exhibit 99.2 to Form 8-K filed on May 17, 2018
   
 Amendment to Amended and Restated 2002 Share Incentive Plan of Camden Property Trust Exhibit 99.1 to Form 8-K filed on May 4, 2006
     
 Amendment to Amended and Restated 2002 Share Incentive Plan of Camden Property Trust, effective as of January 1, 2008 Exhibit 99.1 to Form 8-K filed on July 29, 2008
   
 Camden Property Trust 2011 Share Incentive Plan, effective as of May 11, 2011 Exhibit 99.1 to Form 8-K filed on May 12, 2011
     
 Amendment No. 1 to 2011 Share Incentive Plan of Camden Property Trust, dated as of July 31, 2012 Exhibit 99.1 to Form 8-K filed on August 6, 2012
     
 Amendment No. 2 to the 2011 Share Incentive Plan of Camden Property Trust, dated as of July 30, 2013 Exhibit 99.1 to Form 8-K filed on August 5, 2013
     
 Amendment No. 3 to the 2011 Share Incentive Plan of Camden Property Trust, dated as of October 28, 2015 Exhibit 99.1 to Form 8-K filed on October 29, 2015
     
 Camden Property Trust 2018 Share Incentive Plan, effective as of May 17, 2018 Exhibit 99.1 to Form 8-K filed on May 17, 2018
     
 Camden Property Trust Short Term Incentive Plan Exhibit 10.2 to Form 10-Q for the quarter ended March 31, 2002
   
 Second Amended and Restated Camden Property Trust Non-Qualified Deferred Compensation Plan Exhibit 99.1 to Form 8-K filed on February 21, 2014
     
 Amended and Restated Camden Property Trust Non-Qualified Deferred Compensation Plan Exhibit 10.35 to Form 10-K filed on February 15, 2019
     
 Form of Second Amended and Restated Agreement of Limited Partnership of Camden Summit Partnership, L.P. among Camden Summit, Inc., as general partner, and the persons whose names are set forth on Exhibit A thereto Exhibit 10.5 to Form S-4 filed on November 24, 2004 (Registration No. 333-120733)
   
 Form of Tax, Asset and Income Support Agreement among Camden Property Trust, Camden Summit, Inc., Camden Summit Partnership, L.P. and each of the limited partners who has executed a signature page thereto Exhibit 10.6 to Form S-4 filed on November 24, 2004 (Registration No. 333-120733)
   

42


Exhibit No. Description Filed Herewith or Incorporated Herein by Reference (1)
 Agreement, dated as of September 14, 2018, among William F. Paulsen, the 2014 Amended and Restated William B. McGuire Junior Revocable Trust, David F. Tufaro, McGuire Family DE 2012 LP, William B. McGuire, Jr., Susanne H. McGuire, Camden Property Trust, Camden Summit, Inc. and Camden Summit Partnership, L.P. Exhibit 99.1 to Form 8-K filed by Camden Property Trust on September 17, 2018 (File No. 1-12110)
     
 Employment Agreement dated February 15, 1999, by and among William B. McGuire, Jr., Summit Properties Inc. and Summit Management Company, as restated on August 24, 2001 Exhibit 10.1 to Summit Properties Inc.’s Form 10-Q for the quarter ended September 30, 2001 (File No. 000-12792)
   
 Amendment Agreement, dated as of June 19, 2004, among William B. McGuire, Jr., Summit Properties Inc. and Summit Management Company Exhibit 10.8.2 to Summit Properties Inc.’s Form 10-Q for the quarter ended June 30, 2004 (File No. 001-12792)
     
 Employment Agreement dated February 15, 1999, by and among William F. Paulsen, Summit Properties Inc. and Summit Management Company, as restated on April 3, 2001 Exhibit 10.1 to Summit Properties Inc.’s Form 10-Q for the quarter ended June 30, 2001 (File No. 000-12792)
     
 Amendment Agreement, dated as of June 19, 2004, among William F. Paulsen, Summit Properties Inc. and Summit Management Company Exhibit 10.8.2 to Summit Properties Inc.’s Form 10-Q for the quarter ended June 30, 2004 (File No. 001-12792)
   
 Separation Agreement, dated as of February 28, 2005, between Camden Property Trust and William B. McGuire, Jr. Exhibit 99.1 to Form 8-K filed on April 28, 2005
   
 Separation Agreement, dated as of February 28, 2005, between Camden Property Trust and William F. Paulsen Exhibit 99.2 to Form 8-K filed on April 28, 2005
     
 Distribution Agency Agreement, dated May 15, 2017, between Camden Property Trust and Jefferies LLC Exhibit 1.1 to Form 8-K filed on May 16, 2017
     
 Distribution Agency Agreement, dated May 15, 2017, between Camden Property Trust and J.P. Morgan Securities LLC Exhibit 1.2 to Form 8-K filed on May 16, 2017
     
 Distribution Agency Agreement, dated May 15, 2017, between Camden Property Trust and Merrill Lynch, Pierce, Fenner & Smith Incorporated Exhibit 1.3 to Form 8-K filed on May 16, 2017
     
 Distribution Agency Agreement, dated May 15, 2017, between Camden Property Trust and SunTrust Robinson Humphrey, Inc. Exhibit 1.4 to Form 8-K filed on May 16, 2017
     
 Distribution Agency Agreement, dated May 15, 2017, between Camden Property Trust and Wells Fargo Securities, LLC Exhibit 1.5 to Form 8-K filed on May 16, 2017
   

43


Exhibit No. Description Filed Herewith or Incorporated Herein by Reference (1)
 Third Amended and Restated Credit Agreement dated as of March 8, 2019 among Camden Property Trust, as the Borrower, Bank of America, N.A., as Administrative Agent, JPMorgan Chase Bank, N.A., U.S. Bank National Association, and PNC Bank National Association, as Syndication Agents, The Bank of Nova Scotia, Branch Banking and Trust Company, Deutsche Bank Securities Inc., Regions Bank, SunTrust Bank, and Wells Fargo Bank, National Association, as Documentation Agents, TD Bank N.A., as Managing Agent, and the other lenders party thereto, Merrill Lynch, Pierce, Fenner & Smith Incorporated, J.P. Morgan Chase Bank N.A., U.S. Bank National Association, and PNC Capital Markets LLC, as Joint Lead Arrangers, Merrill Lynch, Pierce, Fenner & Smith Incorporated, and J.P. Morgan Chase Bank N.A., as Joint Bookrunners Exhibit 99.1 to Form 8-K filed on March 8, 2019
     
 List of Significant Subsidiaries Filed Herewith
   
 Consent of Deloitte & Touche LLP Filed Herewith
     
 Powers of Attorney for Heather J. Brunner, Mark D. Gibson, Scott S. Ingraham, Renu Khator, William B. McGuire, Jr., William F. Paulsen, Frances Aldrich Sevilla-Sacasa, Steven A. Webster, and Kelvin R. Westbrook Filed Herewith
   
 Certification of Chief Executive Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act Filed Herewith
     
 Certification of Chief Financial Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act Filed Herewith
     
 Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 Filed Herewith
     
101.INS XBRL Instance Document XBRL Instance Document - The instance document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL document
   
101.SCH XBRL Taxonomy Extension Schema Document Filed Herewith
   
101.CAL XBRL Taxonomy Extension Calculation Linkbase Document Filed Herewith
     
101.DEF XBRL Taxonomy Extension Definition Linkbase Document Filed Herewith
     
101.LAB XBRL Taxonomy Extension Label Linkbase Document Filed Herewith
     
101.PRE XBRL Taxonomy Extension Presentation Linkbase Document Filed Herewith
     
104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) Filed Herewith
     
(1)
Unless otherwise indicated, all references to reports or registration statements are to reports or registration statements filed by Camden Property Trust (File No. 1-12110).
(2)Pursuant to SEC Release No. 33-10322 and Rule 311 of Regulation S-T, this exhibit was filed in paper before the mandated electronic filing.
(3)Portions of the exhibit have been omitted pursuant to a request for confidential treatment.
Item 16. Summary
None.

44


SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, Camden Property Trust has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized.
 
February 20, 2020   CAMDEN PROPERTY TRUST
    
    By: /s/ Michael P. Gallagher
      Michael P. Gallagher
      Senior Vice President — Chief Accounting Officer


45


Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below by the following persons on behalf of Camden Property Trust and in the capacities and on the dates indicated.
 
Name Title Date
   
/s/ Richard J. Campo Chairman of the Board of Trust February 20, 2020
Richard J. Campo 
Managers and Chief Executive
Officer (Principal Executive Officer)
  
   
/s/ D. Keith Oden Executive Vice Chairman of the Board of Trust February 20, 2020
D. Keith Oden Managers  
   
/s/ Alexander J. Jessett Executive Vice President - Finance, February 20, 2020
Alexander J. Jessett 
Chief Financial Officer and Treasurer (Principal
Financial Officer)
  
   
/s/ Michael P. Gallagher Senior Vice President - Chief Accounting February 20, 2020
Michael P. Gallagher 
Officer (Principal Accounting
Officer)
  
     
*  
Heather J. Brunner Trust Manager February 20, 2020
     
*  
Scott S. Ingraham Trust Manager February 20, 2020
     
*  
Renu Khator Trust Manager February 20, 2020
     
*  
William B. McGuire, Jr. Trust Manager February 20, 2020
     
*  
William F. Paulsen Trust Manager February 20, 2020
     
*  
Frances Aldrich Sevilla-Sacasa Trust Manager February 20, 2020
     
*  
Steven A. Webster Trust Manager February 20, 2020
     
*  
Kelvin R. Westbrook Trust Manager February 20, 2020
     
*By: /s/ Alexander J. Jessett  
Alexander J. Jessett
Attorney-in-fact
    

46



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and the Board of Trust Managers of Camden Property Trust

Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of Camden Property Trust and subsidiaries (the "Company") as of December 31, 2019 and 2018, the related consolidated statements of income and comprehensive income, equity, and cash flows, for each of the three years in the period ended December 31, 2019, and the related notes and the schedules listed in the Index at Item 15 (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2019 and 2018, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2019, in conformity with accounting principles generally accepted in the United States of America.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2019, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 20, 2020, expressed an unqualified opinion on the Company's internal control over financial reporting.
Basis for Opinion
These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Asset Impairment - Determination of Impairment Indicators of Properties Under Development, Including Land - Refer to Note 2 to the financial statements
Critical Audit Matter Description
The Company’s evaluation of properties under development, including land (“properties under development”), for impairment involves an initial assessment to determine whether events or changes in circumstances indicate that the carrying amount of properties under development may not be recoverable. Possible indications of impairment of properties under development may include deterioration of market conditions or changes in the Company’s development strategy that may significantly affect key assumptions used in fair value estimates.
The Company considers projected future undiscounted cash flows, trends, strategic decisions regarding future development plans, and other factors in the assessment of whether impairment conditions exist. The Company makes significant assumptions, such as project start date, as well as estimates of demand for multifamily communities, market rents, economic conditions, and occupancies, to evaluate properties under development for possible indications of impairment. Changes in these assumptions could

F-1


have a significant impact on concluding whether impairment indications exist, which would require a recoverability test to be performed for the properties under development. As of December 31, 2019, the Company’s properties under development had an aggregate book value of $512.3 million, and no impairment loss has been recognized for the year ended December 31, 2019.
Given the Company’s evaluation of impairment indicators for the properties under development requires management to make judgments related to significant assumptions described above, performing audit procedures to evaluate whether management appropriately identified events or changes in circumstances indicating that the carrying amounts may not be recoverable required a high degree of auditor judgment.
How the Critical Audit Matter Was Addressed in the Audit
Our audit procedures related to the evaluation of properties under development for possible indications of impairment included the following, among others:
We tested the effectiveness of controls over management’s process of identifying indicators of asset impairment, including controls over management’s estimates of projected occupancy and market rent, projected construction costs, and other market and economic assumptions.
We evaluated the reasonableness of management’s impairment indicator analysis by performing the following procedures:
Compared projected net operating income growth, occupancy rate, and capitalization rate for each property to market averages from third-party market reports and to the Company’s financial performance for operating properties in the same or nearby markets.
Discussed with management and read Board of Trust Managers' meeting minutes to determine if there were any significant adverse changes in legal factors or in the business climate that could affect management’s plans for properties under development, including if it is more likely than not that the properties under development will be sold, not developed, or otherwise disposed of significantly before the end of its previously estimated useful life.
Performed a retrospective lookback review of completed construction projects to determine if projected costs are reasonable to actual completed construction costs.
We performed a search for negative evidence by reading third-party market reports to evaluate management’s analysis to identify any significant changes in economic factors, industry factors, or other adverse events that may result in an impairment indicator.


/s/ DELOITTE & TOUCHE LLP
 
Houston, Texas
February 20, 2020
 
We have served as the Company's auditor since 1993.


F-2


CAMDEN PROPERTY TRUST
CONSOLIDATED BALANCE SHEETS
 
 December 31,
(in thousands, except per share amounts)2019 2018
Assets   
Real estate assets, at cost   
Land$1,199,384
 $1,098,526
Buildings and improvements7,404,090
 6,935,971
 $8,603,474
 $8,034,497
Accumulated depreciation(2,686,025) (2,403,149)
Net operating real estate assets$5,917,449
 $5,631,348
Properties under development, including land512,319
 293,978
Investments in joint ventures20,688
 22,283
Total real estate assets$6,450,456
 $5,947,609
Accounts receivable – affiliates21,833
 22,920
Other assets, net248,716
 205,454
Cash and cash equivalents23,184
 34,378
Restricted cash4,315
 9,225
Total assets$6,748,504
 $6,219,586
Liabilities and equity   
Liabilities   
Notes payable   
Unsecured$2,524,099
 $1,836,427
Secured
 485,176
Accounts payable and accrued expenses171,719
 146,866
Accrued real estate taxes54,408
 54,358
Distributions payable80,973
 74,982
Other liabilities215,581
 183,999
Total liabilities$3,046,780
 $2,781,808
Commitments and contingencies (Note 14)

 

Non-qualified deferred compensation share awards
 52,674
Equity   
Common shares of beneficial interest; $0.01 par value per share; 175,000 shares authorized; 109,110 and 105,503 issued; 106,878 and 103,080 outstanding at December 31, 2019 and 2018, respectively1,069
 1,031
Additional paid-in capital4,566,731
 4,154,763
Distributions in excess of net income attributable to common shareholders(584,167) (495,496)
Treasury shares, at cost (9,636 and 9,841 common shares, at December 31, 2019 and 2018, respectively)(348,419) (355,804)
Accumulated other comprehensive income (loss)(6,529) 6,929
Total common equity$3,628,685
 $3,311,423
Non-controlling interests73,039
 73,681
Total equity$3,701,724
 $3,385,104
Total liabilities and equity$6,748,504
 $6,219,586
See Notes to Consolidated Financial Statements.

F-3


CAMDEN PROPERTY TRUST
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
 
 Year Ended December 31,
(in thousands, except per share amounts)2019 2018 2017
Property revenues$1,028,461
 $954,505
 $900,896
Property expenses     
Property operating and maintenance$235,589
 $220,732
 $217,817
Real estate taxes130,758
 122,847
 110,925
Total property expenses$366,347
 $343,579
 $328,742
Non-property income     
Fee and asset management$8,696
 $7,231
 $8,176
Interest and other income3,090
 2,101
 3,011
Income (loss) on deferred compensation plans21,694
 (6,535) 16,608
Total non-property income$33,480
 $2,797
 $27,795
Other expenses     
Property management$25,290
 $25,581
 $25,773
Fee and asset management5,759
 4,451
 3,903
General and administrative53,201
 50,735
 50,587
Interest80,706
 84,263
 86,750
Depreciation and amortization336,274
 300,946
 263,974
Expense (benefit) on deferred compensation plans21,694
 (6,535) 16,608
Total other expenses$522,924
 $459,441
 $447,595
Loss on early retirement of debt(11,995) 
 (323)
Gain on sale of operating properties49,901
 
 43,231
Equity in income of joint ventures14,783
 7,836
 6,822
Income from continuing operations before income taxes$225,359
 $162,118
 $202,084
Income tax expense(1,089) (1,424) (1,224)
Net income$224,270
 $160,694
 $200,860
Less income allocated to non-controlling interests(4,647) (4,566) (4,438)
Net income attributable to common shareholders$219,623
 $156,128
 $196,422
Total earnings per share – basic2.23
 1.63
 2.14
Total earnings per share – diluted2.22
 1.63
 2.13
Weighted average number of common shares outstanding – basic98,460
 95,208
 91,499
Weighted average number of common shares outstanding – diluted99,384
 95,366
 92,515
See Notes to Consolidated Financial Statements.


F-4


CAMDEN PROPERTY TRUST
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (Continued)
 
 Year Ended December 31,
(In thousands, except per share amounts)2019 2018 2017
Consolidated Statements of Comprehensive Income     
Net income$224,270
 $160,694
 $200,860
Other comprehensive income     
Unrealized gain (loss) on cash flow hedging activities(12,998) 6,782
 1,690
Unrealized gain (loss) and unamortized prior service cost on post retirement obligation(449) 450
 (20)
Reclassification of net (gain) loss on cash flow hedging activities, prior service cost and net loss on post retirement obligation(11) (246) 136
Comprehensive income$210,812
 $167,680
 $202,666
Less income allocated to non-controlling interests(4,647) (4,566) (4,438)
Comprehensive income attributable to common shareholders$206,165
 $163,114
 $198,228
See Notes to Consolidated Financial Statements.

F-5


CAMDEN PROPERTY TRUST
CONSOLIDATED STATEMENTS OF EQUITY
 
 Common Shareholders    
(in thousands, except per share amounts)
Common
shares of
beneficial
interest
 
Additional
paid-in capital
 
Distributions
in excess of
net income
 
Treasury
shares, at cost
 
Accumulated
other
comprehensive
loss
 
Non-controlling
interests
 
Total
equity
Equity, December 31, 2016$978
 $3,678,277
 $(289,180) $(373,339) $(1,863) $80,680
 $3,095,553
Net income    196,422
     4,438
 200,860
Other comprehensive income        1,806
   1,806
Common shares issued (4,778 shares)48
 444,990
         445,038
Net share awards  15,779
   8,177
     23,956
Employee share purchase plan  1,030
   686
     1,716
Common share options exercised (11 shares)  521
   410
     931
Change in classification of deferred compensation plan  (13,388)         (13,388)
Change in redemption value of non-qualified share awards    (10,038)       (10,038)
Diversification of share awards within deferred compensation plan  10,159
 13,074
       23,233
Conversions of operating partnership unit (3 shares)  117
       (117) 
Cash distributions declared to equity holders ($3.00 per share)    (278,981)     (5,650) (284,631)
Other2
 (324)         (322)
Equity, December 31, 2017$1,028
 $4,137,161
 $(368,703) $(364,066) $(57) $79,351
 $3,484,714
Net income    156,128
     4,566
 160,694
Other comprehensive income        6,986
   6,986
Net share awards  13,720
   7,961
     21,681
Employee share purchase plan  826
   554
     1,380
Common share options exercised (8 shares)  41
   


     41
Change in classification of deferred compensation plan  (16,407)         (16,407)
Change in redemption value of non-qualified share awards    669
       669
Diversification of share awards within deferred compensation plan  29,379
 10,915
       40,294
Common shares repurchased      (253)     (253)
Conversion/redemption of operating partnership units (2 shares)  (9,781)       (4,634) (14,415)
Cash distributions declared to equity holders ($3.08 per share)    (294,505)     (5,602) (300,107)
Other3
 (176)         (173)
Equity, December 31, 2018$1,031
 $4,154,763
 $(495,496) $(355,804) $6,929
 $73,681
 $3,385,104
See Notes to Consolidated Financial Statements.

F-6



CAMDEN PROPERTY TRUST
CONSOLIDATED STATEMENTS OF EQUITY (Continued)
 
 Common Shareholders    
(in thousands, except per share amounts)
Common
shares of
beneficial
interest
 
Additional
paid-in capital
 
Distributions
in excess of
net income
 
Treasury
shares, at cost
 
Accumulated
other
comprehensive
loss
 
Non-controlling
interests
 
Total
equity
Equity, December 31, 2018$1,031
 $4,154,763
 $(495,496) $(355,804) $6,929
 $73,681
 $3,385,104
Net income    219,623
     4,647
 224,270
Other comprehensive (loss)        (13,458)   (13,458)
Common shares issued (3,599 shares)36
 353,177
         353,213
Net share awards  13,609
   6,590
     20,199
Employee share purchase plan  1,538
   795
     2,333
Change in classification of deferred compensation plan (See Note 11)  43,311
 9,363
       52,674
Conversion of operating partnership units (8 shares)  304
       (304) 
Cash distributions declared to equity holders ($3.20 per share)    (317,657)     (5,607) (323,264)
Other2
 29
       622
 653
Equity, December 31, 2019$1,069
 $4,566,731
 $(584,167) $(348,419) $(6,529) $73,039
 $3,701,724
See Notes to Consolidated Financial Statements.



F-7


CAMDEN PROPERTY TRUST
CONSOLIDATED STATEMENTS OF CASH FLOWS
 
 Year Ended December 31,
(in thousands)2019 2018 2017
Cash flows from operating activities     
Net income$224,270
 $160,694
 $200,860
Adjustments to reconcile net income to net cash from operating activities:     
Depreciation and amortization336,274
 300,946
 263,974
Loss on early retirement of debt11,995
 
 323
Gain on sale of operating properties(49,901) 
 (43,231)
Distributions of income from joint ventures14,843
 7,736
 6,851
Equity in income of joint ventures(14,783) (7,836) (6,822)
Share-based compensation15,235
 16,749
 17,547
Receipts for settlement of forward interest rate swaps(20,430) 15,905
 
Net change in operating accounts and other38,094
 9,553
 (4,846)
Net cash from operating activities$555,597
 $503,747
 $434,656
Cash flows from investing activities     
Development and capital improvements, including land$(407,558) $(359,230) $(299,086)
Acquisition of operating property(436,305) (290,005) (58,267)
Proceeds from sales of operating properties, including land67,572
 11,296
 76,902
Increase in non-real estate assets(17,197) (14,503) (5,128)
Decrease (increase) in notes receivable1,394
 9,475
 (1,988)
Maturity of short-term investments
 
 100,000
Other(351) 2,046
 (2,187)
Net cash from investing activities$(792,445) $(640,921) $(189,754)
Cash flows from financing activities     
Borrowings on unsecured credit facility and other short-term borrowings$1,217,000
 $342,000
 $465,000
Repayments on unsecured credit facility and other short-term borrowings(1,173,000) (342,000) (465,000)
Repayment of notes payable, including prepayment penalties(746,730) (381,438) (278,999)
Proceeds from notes payable889,979
 495,545
 
Distributions to common shareholders and non-controlling interests(317,253) (298,005) (280,761)
Payment of deferred financing costs(5,965) (914) (978)
Proceeds from issuance of common shares353,213
 
 445,038
Repurchase of common shares and redemption of units
 (14,668) 
Other3,500
 2,452
 2,777
Net cash from financing activities$220,744
 $(197,028) $(112,923)
Net increase (decrease) in cash, cash equivalents, and restricted cash(16,104) (334,202) 131,979
Cash, cash equivalents, and restricted cash, beginning of year43,603
 377,805
 245,826
Cash, cash equivalents, and restricted cash, end of year$27,499
 $43,603
 $377,805
See Notes to Consolidated Financial Statements.


F-8



CAMDEN PROPERTY TRUST
CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
 
 Year Ended December 31,
(in thousands)2019 2018 2017
Reconciliation of cash, cash equivalents, and restricted cash to the Consolidated Balance Sheet     
Cash and cash equivalents$23,184
 $34,378
 $368,492
Restricted cash4,315
 9,225
 9,313
Total cash, cash equivalents, and restricted cash, end of year27,499
 43,603
 377,805
Supplemental information     
Cash paid for interest, net of interest capitalized$71,248
 $81,299
 $88,654
Cash paid for income taxes1,291
 1,951
 1,705
Supplemental schedule of noncash investing and financing activities     
Distributions declared but not paid$80,973
 $74,982
 $72,943
Value of shares issued under benefit plans, net of cancellations18,249
 17,253
 18,061
Accrual associated with construction and capital expenditures27,162
 35,588
 19,016
       Right-of-use assets obtained in exchange for the use of new operating lease liabilities15,017
 
 
See Notes to Consolidated Financial Statements.

F-9


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. Description of Business
Business. Formed on May 25, 1993, Camden Property Trust, a Texas real estate investment trust (“REIT”), and all consolidated subsidiaries are primarily engaged in the ownership, management, development, redevelopment, acquisition, and construction of multifamily apartment communities. Our multifamily apartment communities are referred to as “communities,” “multifamily communities,” “properties,” or “multifamily properties” in the following discussion. As of December 31, 2019, we owned interests in, operated, or were developing 172 multifamily properties comprised of 58,315 apartment homes across the United States. Of the 172 properties, 8 properties were under construction, and will consist of a total of 2,208 apartment homes when completed. We also own land holdings which we may develop into multifamily communities in the future.
2. Summary of Significant Accounting Policies and Recent Accounting Pronouncements
Principles of Consolidation. Our consolidated financial statements include our accounts and the accounts of other subsidiaries and joint ventures (including partnerships and limited liability companies) over which we have control. All intercompany transactions, balances, and profits have been eliminated in consolidation. Investments acquired or created are evaluated based on the accounting guidance relating to variable interest entities (“VIEs”), which requires the consolidation of VIEs in which we are considered to be the primary beneficiary. If the investment is determined not to be a VIE, then the investment is evaluated for consolidation primarily using a voting interest model. In determining if we have a controlling financial interest, we consider factors such as ownership interests, authority to make decisions, kick-out rights and participating rights. As of December 31, 2019, two of our consolidated operating partnerships are VIEs. We are considered the primary beneficiary of both consolidated operating partnerships and therefore consolidate these operating partnerships.  As of December 31, 2019, we held approximately 92% and 95% of the outstanding common limited partnership units and the sole 1% general partnership interest in each of these consolidated operating partnerships.
Acquisitions of Real Estate. Upon the acquisition of real estate, we determine the fair value of tangible and intangible assets, which includes land, buildings (as-if-vacant), furniture and fixtures, the value of in-place leases, including above and below market leases, and acquired liabilities. In estimating these values, we apply methods similar to those used by independent appraisers of income-producing property. Estimates of fair value of acquired debt are based upon interest rates available for the issuance of debt with similar terms and remaining maturities. Depreciation is computed on a straight-line basis over the remaining useful lives of the related tangible assets. The value of in-place leases and above or below market leases is amortized over the estimated average remaining life of leases in place at the time of acquisition; the net carrying value of in-place leases are included in other assets, net and the net carrying value of above or below market leases are included in other liabilities, net in our consolidated balance sheets.
During the years ended December 31, 2019, 2018, and 2017, we recognized amortization expense of approximately $10.4 million, $9.4 million, and $1.3 million, respectively, related to in-place leases. The net amortization of above-market and below-market leases increased rental revenues by $0.1 million and $0.2 million during the years ended December 31, 2019 and 2018, respectively. We did not recognize any net amortization of above-market and below-market leases during the year ended December 31, 2017. During the year ended December 31, 2019, the weighted average amortization periods for both in-place and net above and below market leases were approximately six months. During the year ended December 31, 2018, the weighted average amortization period for in-place and net above and below market leases were approximately seven months and five months. During the year ended December 31, 2017, the weighted average amortization period for in-place leases was approximately six months.
Asset Impairment. Long-lived assets are reviewed for impairment annually or whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. Impairment may exist if estimated future undiscounted cash flows associated with long-lived assets are not sufficient to recover the carrying value of such assets. We consider projected future undiscounted cash flows, trends, strategic decisions regarding future development plans, and other factors in our assessment of whether impairment conditions exist. While we believe our estimates of future cash flows are reasonable, different assumptions regarding a number of factors, including market rents, economic conditions, and occupancies, could significantly affect these estimates. When impairment exists, the long-lived asset is adjusted to its fair value. In estimating fair value, management uses appraisals, management estimates, and discounted cash flow calculations which utilize inputs from a marketplace participant’s perspective. In addition, we evaluate our equity investments in joint ventures and if we believe there is an other than temporary decline in market value of our investment below our carrying value, we will record an impairment charge. We did not record any impairment charges for the years ended December 31, 2019, 2018, or 2017.
The value of our properties under development depends on market conditions, including estimates of the project start date as well as estimates of demand for multifamily communities. We have reviewed market trends and other marketplace information and have incorporated this information as well as our current outlook into the assumptions we use in our impairment analyses.

F-10


Due to the judgment and assumptions applied in the impairment analyses, it is possible actual results could differ substantially from those estimated.
We believe the carrying value of our operating real estate assets, properties under development, and land is currently recoverable. However, if market conditions deteriorate or if changes in our development strategy significantly affect any key assumptions used in our fair value estimates, we may need to take material charges in future periods for impairments related to existing assets. Any such non-cash charges could have an adverse effect on our consolidated financial position and results of operations.
Cash and Cash Equivalents. All cash and investments in money market accounts and other highly liquid securities with a maturity of three months or less at the date of purchase are considered to be cash and cash equivalents. We maintain the majority of our cash and cash equivalents at major financial institutions in the United States and deposits with these financial institutions may exceed the amount of insurance provided on such deposits; however, we regularly monitor the financial stability of these financial institutions and believe we are not currently exposed to any significant default risk with respect to these deposits.
Short-term Investments. Our short-term investments consisted of certificates of deposit which have original maturities of more than three months but less than one year.
Cost Capitalization. Real estate assets are carried at cost plus capitalized carrying charges. Carrying charges are primarily interest and real estate taxes which are capitalized as part of properties under development. Capitalized interest is generally based on the weighted average interest rate of our unsecured debt. Expenditures directly related to the development and improvement of real estate assets are capitalized at cost as land and buildings and improvements. Indirect development costs, including salaries and benefits and other related costs directly attributable to the development of properties, are also capitalized. We begin capitalizing development, construction, and carrying costs when the development of the future real estate asset is probable and activities necessary to prepare the underlying real estate for its intended use have been initiated. All construction and certain carrying costs are capitalized and reported in the balance sheet as properties under development until the apartment homes are substantially completed. As apartment homes within development properties are completed, the total capitalized development cost of each apartment home is transferred from properties under development including land to buildings and improvements.
As discussed above, carrying charges are principally interest and real estate taxes capitalized as part of properties under development. Capitalized interest was approximately $14.1 million, $13.6 million, and $15.2 million for the years ended December 31, 2019, 2018, and 2017, respectively. Capitalized real estate taxes were approximately $2.8 million, $2.2 million, and $2.4 million for the years ended December 31, 2019, 2018, and 2017, respectively.
Where possible, we stage our construction to allow leasing and occupancy during the construction period, which we believe minimizes the duration of the lease-up period following completion of construction. Our accounting policy related to properties in the development and leasing phase is to expense all operating costs associated with completed apartment homes. We capitalize renovation and improvement costs we believe extend the economic lives of depreciable property. Capital expenditures subsequent to initial construction are capitalized and depreciated over their estimated useful lives.
Depreciation and amortization is computed over the expected useful lives of depreciable property on a straight-line basis with lives generally as follows:
 
Estimated
Useful  Life
Buildings and improvements5-35 years
Furniture, fixtures, equipment and other3-20 years
Intangible assets/liabilities (in-place leases and below market leases)underlying lease term

Derivative Financial Instruments. Derivative financial instruments are recorded in the consolidated balance sheets at fair value and presented on a gross basis for financial reporting purposes even when those instruments are subject to master netting arrangements and may otherwise qualify for net presentation. Accounting for changes in the fair value of derivatives depends on the intended use of the derivative, whether we have elected to designate a derivative in a hedging relationship and apply hedge accounting, and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows or other types of forecasted transactions are cash flow hedges. Hedge accounting generally provides for the matching of the timing of gain or loss recognition on the hedging instrument with the recognition of the changes attributable to the earnings effect of the hedged transactions. We may enter into derivative contracts which are intended to economically hedge certain of our risks, for which hedge accounting does not apply or we elect not to apply hedge accounting.
Assets Held for Sale (Including Discontinued Operations). Disposed of properties are classified as a discontinued operation when the disposal represents a strategic shift, such as disposal of a major line of business, a major geographical area or a major

F-11


equity investment. The results of operations for properties sold during the period or classified as held for sale at the end of the period, and meeting the above criteria of discontinued operations, are classified as discontinued operations for all periods presented. Real estate assets held for sale are measured at the lower of carrying amount or fair value less costs to sell and are presented separately in the accompanying consolidated balance sheets. Subsequent to classification of a property as held for sale, no further depreciation is recorded. Consolidated operating properties sold or classified as held for sale, which do not meet the above criteria of discontinued operations are not included in discontinued operations and the related gains and losses are included in continuing operations. Properties sold by our unconsolidated entities which do not meet the above criteria of discontinued operations are not included in discontinued operations and related gains or losses are reported as a component of equity in income of joint ventures.
Gains on sale of real estate are recognized when the criteria for derecognition of an asset is met, including when a contract exists and the buyer obtained control of the nonfinancial asset sold, in accordance with accounting principles generally accepted in the United States of America ("GAAP"). As a result, most of our future contributions of nonfinancial assets to our joint ventures, if any, will result in the recognition of a full gain or loss as if we sold 100% of the nonfinancial asset.
Fair Value. For financial assets and liabilities recorded at fair value on a recurring or non-recurring basis, fair value is the price we would receive to sell an asset, or pay to transfer a liability, in an orderly transaction with a market participant at the measurement date. In the absence of such data, fair value is estimated using internal information consistent with what market participants would use in a hypothetical transaction.
In determining fair value, observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect our market assumptions; preference is given to observable inputs. These two types of inputs create the following fair value hierarchy:
 
Level 1: Quoted prices for identical instruments in active markets.
Level 2: Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable.
Level 3: Significant inputs to the valuation model are unobservable.
Recurring Fair Value Measurements. The following describes the valuation methodologies we use to measure different financial instruments at fair value on a recurring basis:
Deferred Compensation Plan Investments. The estimated fair values of investment securities classified as deferred compensation plan investments are based on quoted market prices utilizing public information for the same transactions. Our deferred compensation plan investments are recorded in other assets in our consolidated balance sheets. The inputs associated with the valuation of our recurring deferred compensation plan investments are included in Level 1 of the fair value hierarchy.
Derivative Financial Instruments. The estimated fair values of derivative financial instruments are valued using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves and volatility. The fair values of interest rate swaps and caps are estimated using the market-standard methodology of netting the discounted fixed cash payments and the discounted expected variable cash receipts. The variable cash receipts are based on an expectation of interest rates (forward curves) derived from observable market interest rate curves. In addition, credit valuation adjustments, which consider the impact of any credit enhancements to the contracts, are incorporated in the fair values to account for potential nonperformance risk, including our own nonperformance risk and the respective counterparty’s nonperformance risk. The fair value of interest rate caps is determined using the market-standard methodology of discounting the future expected cash receipts which would occur if variable interest rates rise above the strike rate of the caps. The variable interest rates used in the calculation of projected receipts on the cap are based on an expectation of future interest rates derived from observed market interest rate curves and volatilities.
Although we have determined the majority of the inputs used to value our derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with our derivatives utilize Level 3 inputs, such as estimates of current credit spreads, to evaluate the likelihood of default. However, we have assessed the significance of the impact of the credit valuation adjustments on the overall valuation of our derivative positions and have determined the credit valuation adjustments are not significant to the overall valuation of our derivatives. As a result, we have determined our derivative valuations in their entirety are classified in Level 2 of the fair value hierarchy.
Non-recurring Fair Value Measurements. Certain assets are measured at fair value on a non-recurring basis. These assets are not measured at fair value on an ongoing basis, but are subject to fair value adjustments in certain circumstances. Long-lived assets such as the land, real estate asset, and in-place leases acquired with an operating property are measured in the form of cash received unless otherwise noted. These assets are recorded at fair value if they are impaired using the fair value methodologies

F-12


used to measure long-lived assets described above at "Asset Impairment." The inputs associated with the valuation of long-lived assets are generally included in Level 3 of the fair value hierarchy, unless a quoted price for a similar long-lived asset in an active market exists, at which time they are included in Level 2 of the fair value hierarchy.
Financial Instrument Fair Value Disclosures. As of December 31, 2019 and 2018, the carrying values of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses, and distributions payable represent fair value because of the short-term nature of these instruments. The carrying value of restricted cash approximates its fair value based on the nature of our assessment of the ability to recover these amounts. The carrying value of our notes receivable, which are included in other assets, net in our consolidated balance sheets, approximates their fair value. The estimated fair values are based on certain factors, such as market interest rates, terms of the note, and credit worthiness of the borrower. These financial instruments utilize Level 3 inputs. In calculating the fair value of our notes payable, interest rate, and spread assumptions reflect current credit worthiness and market conditions available for the issuance of notes payable with similar terms and remaining maturities. These financial instruments utilize Level 2 inputs.
Income Recognition. On January 1, 2019, we adopted Accounting Standards Update ("ASU") 2016-02, "Leases" which is codified as ASC 842, Leases. The majority of our revenues are derived from real estate lease contracts which are accounted for pursuant to ASC 842 and presented as property revenues, which include rental revenue and revenue from amounts received under contractual terms for other services provided to our customers. Our other revenue streams include fee and asset management income in accordance with other revenue guidance, ASC 606, Revenues from Contracts with Customers. A detail of these revenue streams are discussed below:
Property Revenue: We earn rental revenue from operating lease contracts for the use of dedicated spaces within owned assets which is recognized on a straight-line basis over the applicable lease term, net of amounts related to lease contracts identified as uncollectible. We also earn revenues from amounts received under contractual terms for other services considered non-lease components within a lease contract, primarily consisting of utility rebillings and other transactional fees, and are charged to our residents and recognized monthly as earned. We elected the practical expedient under ASU 2016-02 to not separate lease and non-lease components and have presented our property revenues combined based upon the lease being determined to be the predominant component. Any uncollectible amounts related to individual lease contracts are presented as an adjustment to property revenue. Any renewal options of real estate lease contracts are considered a new, separate contract and will be recognized at the time the option is exercised on a straight-line basis over the renewal period.
As of December 31, 2019, our average residential lease term was between twelve months to fifteen months with all other commercial leases averaging longer lease terms. We anticipate property revenue from existing leases as follows:
(in millions) 
Year ended December 31,Operating Leases
2020$666.0
202134.1
20225.5
20234.9
20244.1
Thereafter28.3
Total$742.9

Fee and Asset Management Income: We receive property management, asset management, and development and construction fees from our joint ventures for managing the ventures and managing the activities, development, and construction of their operating communities. While the individual activities related to these fees may vary, the services provided are substantially similar, have the same pattern of transfer, and are considered to be individual performance obligations composed of a series of distinct services recognized monthly as earned.
We also earn construction fees for construction management and general contracting services we provide to third-party owners of multifamily and commercial properties. These fees are recognized as we satisfy our single performance obligation over time based on a percentage-of-completion of cost basis which we believe is an accurate depiction of the transfer of control to our customers. For these contracts, significant judgment is used to estimate the cost plus margin for the project fee and our profitability on those contracts is dependent on the ability to accurately predict such factors. We record third-party construction receivables for amounts where we have unconditional rights to payment but have not received and liabilities for amounts incurred but not paid. For the years ended December 31, 2019 and 2018, these contract receivable and liability balances were immaterial.
Credit Risk. In management’s opinion, due to the number of residents, the types and diversity of submarkets in which our properties operate, and the collection terms, there is no significant concentration of credit risk.

F-13


Reclassifications. Certain amounts have been presented separately within financing activities in the consolidated statements of cash flows for the years ended December 31, 2018 and 2017 to conform to the current-year presentation. These changes in presentation had no impact in consolidated cash flows from financing activities. Upon our adoption of ASU 2016-02 on January 1, 2019 we were required, based on our election of a practical expedient, to combine lessor lease and non-lease components as a single component under certain conditions. For the years ended December 31, 2018 and 2017, we combined other property revenues of $112.5 million and $130.4 million, respectively, with rental revenues of $842.0 million and $770.5 million, respectively, to conform to the current year presentation.
Insurance. Our primary lines of insurance coverage are property, general liability, health, workers’ compensation, and cyber security. We believe our insurance coverage adequately insures our properties against the risk of loss attributable to fire, earthquake, hurricane, tornado, flood, and other perils and adequately insures us against other risks. Losses are accrued based upon our estimates of the aggregate liability for claims incurred using certain actuarial assumptions followed in the insurance industry and based on our experience.
Other Assets, Net. Other assets in our consolidated financial statements include investments under deferred compensation plans, deferred financing costs, non-real estate leasehold improvements and equipment, notes receivable, operating lease right-of-use assets, prepaid expenses, and other miscellaneous receivables. Investments under deferred compensation plans are classified as trading securities and are adjusted to fair market value at period end. For a further discussion of our investments under deferred compensation plans, see Note 11, “Share-based Compensation and Benefit Plans.” Deferred financing costs are related to our unsecured credit facility, and are amortized no longer than the terms of the related facility on the straight-line method, which approximates the effective interest method. Corporate leasehold improvements and equipment includes expenditures related to renovation and construction of office space we lease. These leasehold improvements are depreciated using the straight-line method over the shorter of the expected useful lives or the lease terms which generally range from three to ten years.
Notes Receivable. We have one note receivable included in Other assets, net in our consolidated balance sheets, relating to a real estate secured loan to an unaffiliated third party. During 2019, we received payments of approximately $1.4 million in principal and approximately $0.6 million in interest on this note which matures on October 1, 2025. At December 31, 2019 and 2018, the outstanding note receivable balance was approximately $7.9 million and $9.3 million, respectively, and the weighted average interest rate was approximately 7.0% and 4.0%, respectively. Interest is recognized over the life of the note and is included in interest and other income in our consolidated statements of income and comprehensive income. We consider a note receivable to be impaired if it is probable we will not collect all contractually due principal and interest. We do not accrue interest when a note is considered impaired and an allowance is recorded for any principal and previously accrued interest which is not believed to be collectible. All cash receipts on impaired notes are applied to reduce the principal amount of such notes until the principal has been recovered and, thereafter, are recognized as interest income. There were no impairments as of December 31, 2019 or 2018.
Reportable Segments. We operate in a single reportable segment which includes the ownership, management, development, redevelopment, acquisition, and construction of multifamily apartment communities. Each of our operating properties is considered a separate operating segment as each property earns revenues and incurs expenses, individual operating results are reviewed and discrete financial information is available. We do not distinguish or group our consolidated operations based on geography, size or type. Our multifamily apartment communities have similar long-term economic characteristics and provide similar products and services to our residents. Further, all material operations are within the United States and no multifamily apartment community comprises more than 10% of consolidated revenues. As a result, our operating properties are aggregated into a single reportable segment. Our multifamily communities generate property revenue through the leasing of apartment homes, which comprised approximately 99% of our total property revenues and total non-property income, excluding income (loss) on deferred compensation plans, for each of the years ended December 31, 2019, 2018, and 2017.
Restricted Cash. Restricted cash consists of escrow deposits held by lenders for property taxes, insurance and replacement reserves, cash required to be segregated for the repayment of residents’ security deposits, and escrowed amounts related to our development and acquisition activities. Substantially all restricted cash is invested in demand and short-term instruments.
Share-based Compensation. Compensation expense associated with share-based awards is recognized in our consolidated statements of income and comprehensive income using the grant-date fair values. Compensation cost for all share-based awards, including options, requires measurement at estimated fair value on the grant date and recognition of compensation expense over the requisite service period for awards expected to vest. The fair value of stock option grants is estimated using the Black-Scholes valuation model. Valuation models require the input of assumptions, including judgments to estimate the expected stock price volatility, expected life, and forfeiture rate. The compensation cost for share-based awards is based on the market value of the shares on the date of grant and is adjusted as actual forfeitures occur.
Use of Estimates. In the application of GAAP, management is required to make estimates and assumptions which affect the reported amounts of assets and liabilities at the date of the financial statements, results of operations during the reporting periods,

F-14


and related disclosures. Our more significant estimates include estimates supporting our impairment analysis related to the carrying values of our real estate assets. These estimates are based on historical experience and other assumptions believed to be reasonable under the circumstances. Future events rarely develop exactly as forecasted, and the best estimates routinely require adjustment.
Recent Accounting Pronouncements. In August 2018, the Financial Accounting Standards Board ("FASB") issued ASU 2018-15, "Intangibles—Goodwill and Other— Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract." ASU 2018-15 aligns the accounting for costs incurred to implement a cloud computing arrangement which is a service arrangement with the guidance on capitalizing costs associated with developing or obtaining internal-use software. ASU 2018-15 is effective for interim and annual periods beginning after December 15, 2019, and early adoption is permitted. This standard may be applied using the prospective transition method which is applicable to costs for activities on service contracts entered, renewed, materially modified, or performed after the effective date or the retrospective transition method which allows us to recognize a cumulative effect adjustment to the opening balance of retained earnings, if any, as of the adoption date. We adopted as of January 1, 2020, using the prospective transition method and will present future qualified capitalizable costs relating to new completed cloud computing arrangements which are service arrangements as prepaid assets within other assets on our consolidated balance sheets, as cash flows from operating activities on our consolidated statement of cash flows, and the associated amortization as general and administrative expenses on our consolidated statements of income and comprehensive income. Our adoption of ASU 2018-15 will not have a material impact on our consolidated financial statements.
In February 2016, the FASB issued ASU 2016-02, "Leases." ASU 2016-02 and its related amendments codify ASC 842 and provides new guidance for accounting for leases. We adopted ASC 842 as of January 1, 2019 using the transition method which allows us to recognize a cumulative-effect adjustment to the opening balance of retained earnings as of the adoption date and to initially apply the new lease standard to leases which existed as of January 1, 2019. Upon our adoption of ASC 842, as a lessee we recorded a right-of-use asset and a corresponding liability in our consolidated balance sheet, as a lessor we now present combined lease and non-lease components as a single component in our consolidated statement of income and comprehensive income, and this ASU did not have an impact on the opening balance of retained earnings as of the adoption date. In addition to the transition practical expedient, we elected other practical expedients during our adoption of the new lease standard. For both lessor and lessee contracts, we elected the practical expedient package to not reassess: (i) whether any expired or existing contract was a lease or contained a lease, (ii) the lease classification of any expired or existing leases, and (iii) the accounting for initial direct costs for any existing leases.
As a lessor, we also elected practical expedients to:
not separate the lease and non-lease components by class of underlying assets and account for the combined components as a single component under certain conditions, and
exclude from lease revenues the sales taxes collected from lessees and certain lessor costs paid directly by the lessee (as of the date of adoption, we did not have material sales tax collected from customers or lessor costs paid by customers).
As a lessee, we also elected the practical expedients to:
use hindsight to determine lease terms and impairment of the right-of-use assets for existing lease contracts,
not separate lease and non-lease components by class of underlying asset when certain conditions are met which is consistent with our current accounting, and
not recognize short-term lease contracts with a duration of 12 months or less (short-term leases) in our consolidated balance sheet.
We earn income from the leasing of our owned real estate properties which is considered our only lessor underlying asset class. Substantially all of our real estate lessor commitments will continue to be accounted for as operating leases and the new leasing standard did not have a material impact on our property revenues. As a lessee, we enter into lease contracts to facilitate the operations and needs of our business and our operating leases primarily consist of our office facility leases which are considered our only lessee underlying asset class. Our lessee operating lease commitments are subject to this standard and recognized as operating lease liabilities and right-of-use assets upon adoption. See above "Income Recognition," as it relates to our lessor leases and Note 14, "Commitments and Contingencies" as it relates to our lessee leases for additional disclosures required by ASC 842.

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3. Per Share Data
Basic earnings per share are computed using net income attributable to common shareholders and the weighted average number of common shares outstanding. Diluted earnings per share reflect common shares issuable from the assumed conversion of common share options and share awards granted and units convertible into common shares. Only those items having a dilutive impact on our basic earnings per share are included in diluted earnings per share. Our unvested share-based awards are considered participating securities and are reflected in the calculation of basic and diluted earnings per share using the two-class method. The number of common share equivalent securities excluded from the diluted earnings per share calculation was approximately 1.1 million, 2.1 million, and 1.5 million for the years ended December 31, 2019, 2018, and 2017, respectively. These securities, which include common share options and share awards granted and units convertible into common shares, were excluded from the diluted earnings per share calculation as they are anti-dilutive.
The following table presents information necessary to calculate basic and diluted earnings per share for the periods indicated:
  Year Ended December 31,
(in thousands, except per share amounts) 2019 2018 2017
Earnings per common share calculation – basic      
Income from continuing operations attributable to common shareholders $219,623
 $156,128
 $196,422
Amount allocated to participating securities (539) (1,107) (660)
Net income attributable to common shareholders – basic $219,084
 $155,021
 $195,762
       
Total earnings per common share – basic $2.23
 $1.63
 $2.14
       
Weighted average number of common shares outstanding – basic 98,460
 95,208
 91,499
Earnings per common share calculation – diluted      
Income from continuing operations attributable to common shareholders, net of amount allocated to participating securities $219,084
 $155,021
 $195,762
Income allocated to common units from continuing operations 1,593
 
 1,174
Net income attributable to common shareholders – diluted $220,677
 $155,021
 $196,936
       
Total earnings per common share – diluted $2.22
 $1.63
 $2.13
       
Weighted average number of common shares outstanding – basic 98,460
 95,208
 91,499
Incremental shares issuable from assumed conversion of:      
Common share options and share awards granted 119
 158
 211
Common units 805
 
 805
Weighted average number of common shares outstanding – diluted 99,384
 95,366
 92,515

4. Common Shares
In May 2017, we created an at-the market ("ATM") share offering program through which we can, but have no obligation to, sell common shares having an aggregate offering price of up to $315.3 million (the "2017 ATM program"), in amounts and at times as we determine, into the existing trading market at current market prices as well as through negotiated transactions. Actual sales from time to time may depend on a variety of factors including, among others, market conditions, the trading price of our common shares, and determinations by management of the appropriate sources of funding for us. The proceeds from the sale of our common shares under the 2017 ATM program are intended to be used for general corporate purposes, which may include reducing future borrowings under our unsecured line of credit, the repayment of other indebtedness, the redemption or other repurchase of outstanding debt or equity securities, funding for development activities, and financing for acquisitions.
For the year ended December 31, 2018, we did not sell any shares under the 2017 ATM program. The following table presents activity under the 2017 ATM program for the years ended December 31, 2019 and 2017:

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 Year Ended December 31,
(in thousands, except per share amounts)2019 2017
Total net consideration$24,839.1
 $2,513.6
Common shares sold224.3
 28.1
Average price per share$111.88
 $90.44

As of the date of this filing, we had common shares having an aggregate offering price of up to $287.7 million remaining available for sale under the 2017 ATM program. No additional shares were sold under the 2017 ATM program subsequent to December 31, 2019 through the date of this filing.
We have a repurchase plan approved by our Board of Trust Managers which allows for the repurchase of up to $500 million of our common equity securities through open market purchases, block purchases, and privately negotiated transactions. For the year ended December 31, 2018, we repurchased 3,222 common shares for approximately $0.3 million. There were no repurchases under this program for the years ended December 31, 2017 or 2019 or through the date of this filing. The remaining dollar value of our common equity securities authorized to be repurchased under the program was approximately $269.5 million as of the date of this filing.
We currently have an automatic shelf registration statement which allows us to offer, from time to time, common shares, preferred shares, debt securities, or warrants. Our Amended and Restated Declaration of Trust provides we may issue up to 185 million shares of beneficial interest, consisting of 175 million common shares and 10 million preferred shares. At December 31, 2019, we had approximately 97.2 million common shares outstanding, net of treasury shares and shares held in our deferred compensation arrangements, and 0 preferred shares outstanding. In February 2019, we issued approximately 3.4 million common shares in an underwritten equity offering and received approximately $328.4 million in net proceeds, which we used to acquire one operating property in Scottsdale, Arizona, and repay amounts on our unsecured line of credit and certain secured conventional mortgage debt.
In the first quarter of 2020, the Company's Board of Trust Managers declared a first quarter dividend of $0.83 per common share to our common shareholders of record as of March 31, 2020.
5. Operating Partnerships
At December 31, 2019, approximately 4% of our consolidated multifamily apartment homes were held in Camden Operating, L.P. (“Camden Operating” or the “operating partnership”). Camden Operating has 11.9 million outstanding common limited partnership units and as of December 31, 2019, we held approximately 92% of the outstanding common limited partnership units and the sole 1% general partnership interest of the operating partnership. The remaining common limited partnership units, comprising approximately 0.8 million units, are primarily held by former officers, directors, and investors of Paragon Group, Inc., which we acquired in 1997. Each common limited partnership unit is redeemable for one common share of Camden Property Trust or cash at our election. Holders of common limited partnership units are not entitled to rights as shareholders prior to redemption of their common limited partnership units. No member of our management owns Camden Operating common limited partnership units.
At December 31, 2019, approximately 32% of our consolidated multifamily apartment homes were held in Camden Summit Partnership, L.P. (the “Camden Summit Partnership”). Camden Summit Partnership has 22.8 million outstanding common limited partnership units and as of December 31, 2019, we held approximately 95% of the outstanding common limited partnership units and the sole 1% general partnership interest of Camden Summit Partnership. The remaining common limited partnership units, comprising approximately 0.9 million units, are primarily held by former officers, directors, and investors of Summit Properties Inc., which we acquired in 2005. Each common limited partnership unit is redeemable for one common share of Camden Property Trust or cash at our election and holders of common limited partnership units are not entitled to rights as shareholders prior to redemption of their common limited partnership units. No member of our management owns Camden Summit Partnership common limited partnership units, and two of our trust managers own Camden Summit Partnership common limited partnership units.

We made no material changes to any operating partnership agreements during the year ended December 31, 2019. During 2018, we entered into an agreement with certain holders of common units of limited partnership interest in the Camden Summit Partnership, which holders included two of our Trust Managers.  This agreement modifies the original terms of the Tax Protection Agreement dated February 28, 2005 which states the Camden Summit Partnership must maintain a certain amount of secured debt until February 28, 2020 to protect the negative tax capital of the unitholders or reimburse the unitholders for income taxes incurred from the repayment of this indebtedness.  Pursuant to this 2018 agreement, Camden Summit Partnership issued $100.0 million of unsecured debt with an unrelated third party which was guaranteed by Camden Property Trust. Additionally, each such unitholder agreed to indemnify Camden Property Trust for their portion of the unsecured debt equal to the amount of income and gain which would be required to be recognized by the unitholder due to their negative tax capital account; the indemnities are for

F-17


a one-year period with an annual October 15 renewal right.  These amounts were approximately $21.2 million in the aggregate for the two Trust Managers which are holders of common units of limited partner interest in Camden Summit Partnership. In return, Camden Summit Partnership agreed to extend the duration of the Tax Protection Agreement for two years for each year such unitholder's indemnification agreement remains in place.
6. Income Taxes
We have maintained and intend to maintain our election as a REIT under the Internal Revenue Code of 1986, as amended. In order for us to continue to qualify as a REIT we must meet a number of organizational and operational requirements, including a requirement to distribute annual dividends to our shareholders equal to a minimum of 90% of our adjusted taxable income. As a REIT, we generally will not be subject to federal income tax on our taxable income at the corporate level to the extent such income is distributed to our shareholders annually. If our taxable income exceeds our dividends in a tax year, REIT tax rules allow us to designate dividends from the subsequent tax year in order to avoid current taxation on undistributed income. If we fail to qualify as a REIT in any taxable year, we may be subject to federal and state income taxes for such year. In addition, we may not be able to requalify as a REIT for the four subsequent taxable years and may be subject to federal and state income taxes in those years as well. Historically, we have incurred only state and local income, franchise, and excise taxes. Taxable income from non-REIT activities managed through taxable REIT subsidiaries is subject to applicable federal, state, and local income taxes. Our operating partnerships are flow-through entities and are not subject to federal income taxes at the entity level.
We have recorded income, franchise, and excise taxes in the consolidated statements of income and comprehensive income for the years ended December 31, 2019, 2018 and 2017 as income tax expense. Income taxes for the years ended December 31, 2019, 2018 and 2017, primarily related to state income tax and federal taxes on certain of our taxable REIT subsidiaries. We have 0 significant temporary or permanent differences or tax credits associated with our taxable REIT subsidiaries.
For income tax purposes, distributions to common shareholders are characterized as ordinary income, capital gains or as a return of a shareholder's invested capital. A summary of the income tax characterization of our distributions paid per common share for the years ended December 31, 2019, 2018 and 2017 is set forth in the following table:
 
  Year Ended December 31,
  2019 2018 2017
Common Share Distributions      
Ordinary income $2.53
 $2.99
 $2.38
Long-term capital gain 0.46
 0.09
 0.41
Unrecaptured Sec. 1250 gain 0.21
 
 0.21
Total $3.20
 $3.08
 $3.00

We have taxable REIT subsidiaries which are subject to federal and state income taxes. At December 31, 2019, our taxable REIT subsidiaries had immaterial net operating loss carryforwards (“NOL’s”) related to 2017 and prior which expire in years 2034 to 2037 and no benefits related to these NOL’s have been recognized in our consolidated financial statements. For any post 2017 NOL's, the NOL can be carried forward indefinitely, however, usage of the NOL is limited to 80% of any year's taxable income.
The carrying value of net assets reported in our consolidated financial statements at December 31, 2019 exceeded the tax basis by approximately $1.3 billion.
Income Tax Expense. We had income tax expense of approximately $1.1 million, $1.4 million and $1.2 million for the tax years ended December 31, 2019, 2018 and 2017, respectively, which was comprised mainly of state income tax and federal income tax related to one of our taxable REIT subsidiaries.
Income Tax Expense – Deferred. For the years ended December 31, 2019, 2018, and 2017, our deferred tax expense was not significant.
The income tax returns of Camden Property Trust and its subsidiaries are subject to examination by federal, state and local tax jurisdictions for years 2016 through 2018.  Tax attributes generated in years prior to 2016 are also subject to challenge in any examination of those tax years. We believe we have 0 uncertain tax positions or unrecognized tax benefits requiring disclosure as of and for the periods presented.
Tax reform. The 2017 Tax Act was passed on December 22, 2017 which includes a number of changes to the corporate income tax system, including but not limited to a reduction in the statutory federal corporate income tax rate from 35% to 21% for non-REIT “C” corporations, changes to deductions for certain pass-through business income, and possible limitations on interest expense, depreciation and the deductibility of executive compensation. As a REIT, we generally will not be subject to

F-18


federal income tax on our taxable income at the corporate level and the changes from the 2017 Tax Act did not have a material impact on our consolidated financial statements.
7. Acquisitions and Dispositions
Asset Acquisition of Operating Properties. In December 2019, we acquired 1 operating property comprised of 186 apartment homes in Raleigh, North Carolina for approximately $75.1 million, and 1 operating property comprised of 552 apartment homes in Houston, Texas for approximately $147.2 million. In May 2019, we acquired 1 operating property comprised of 326 apartment homes located in Austin, Texas for approximately $120.4 million. In February 2019, we acquired 1 operating property comprised of 316 apartment homes located in Scottsdale, Arizona for approximately $97.1 million.
In September 2018, we acquired 1 operating property comprised of 299 apartment homes located in Orlando, Florida, for approximately $89.8 million. In February 2018, we acquired 1 operating property comprised of 333 apartment homes located in Orlando, Florida, for approximately $81.4 million. In January 2018, we acquired 1 operating property comprised of 358 apartment homes located in St. Petersburg, Florida, for approximately $126.9 million. In June 2017, we acquired 1 operating property comprised of 250 apartment homes, located in Atlanta, Georgia, for approximately $58.3 million.
Acquisitions of Land. In connection with the acquisition of the operating property in Houston, Texas in December 2019, we acquired approximately 2.3 acres of land adjacent to the operating property for approximately $8.0 million for the future development of approximately 300 apartment homes. In May 2019, we acquired approximately 11.6 acres of land in Tempe, Arizona for approximately $18.0 million for the development of approximately 400 apartment homes. In April 2019, we acquired approximately 4.3 acres of land in Charlotte, North Carolina for approximately $10.9 million for the development of approximately 400 apartment homes. During the year ended December 31, 2018, we acquired approximately 1.8 acres of land in Orlando, Florida for approximately $11.4 million for the development of a community with 360 apartment homes. During the year ended December 31, 2017, we acquired approximately 8.2 acres of land in San Diego, California for approximately $20.0 million for the development of approximately 132 apartment homes.
In January 2020, we acquired 4.9 acres of land in Raleigh, North Carolina for approximately $18.2 million for the future development of approximately 355 apartment homes.
Land Holding Dispositions. During the year ended December 31, 2018, we sold approximately 14.1 acres of land adjacent to two development properties in Phoenix, Arizona for approximately $11.5 million. We did not sell any land during the years ended December 31, 2019 or 2017.
Sale of Operating Properties. During the year ended December 31, 2019, we sold our remaining 3 operating properties in Corpus Christi, Texas. The operating properties sold included 2 consolidated communities comprised of 632 apartment homes and 1 joint venture community comprised of 270 apartment homes. The total net proceeds recognized from the disposition of the two consolidated communities was approximately $69.4 million and we recognized a gain of approximately $49.9 million. See Note 8, "Investments in Joint Ventures" for further discussion of the joint venture community. We did not sell any operating properties during the year ended December 31, 2018. During the year ended December 31, 2017, we sold 1 operating property, comprised of 1,005 apartment homes, located in Corpus Christi, Texas for approximately $78.4 million and recognized a gain of approximately $43.2 million.
8. Investments in Joint Ventures
Our equity investments in unconsolidated joint ventures, which we account for utilizing the equity method of accounting, consists of 3 funds (collectively, the "Funds"). At December 31, 2019, 2018, and 2017, we had two discretionary investment funds in which we had an ownership interest of 31.3% in each of these funds. In March 2015, we completed the formation of a third fund with an unaffiliated third party for additional multifamily investments of up to $450.0 million. In June 2019, we amended the third fund's agreement, among other things, to reduce the investments from $450.0 million to approximately $360.0 million and increase our ownership interest from 20% to 40%. This third fund did not own any properties in 2019, 2018, or 2017. We provide property and asset management and other services to the Funds which own operating properties and we may also provide construction and development services to the Funds which own properties under development. The following table summarizes the combined balance sheet and statement of income data for the Funds as of and for the periods presented:
 
(in millions)2019 2018
Total assets$685.0
 $695.2
Total third-party debt496.9
 510.7
Total equity153.4
 158.4

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 2019 2018 2017
Total revenues$131.7
 $127.4
 $121.9
Gain on sale of operating property (1)
19.8
 
 
Net income (2)
37.5
 16.4
 13.5
Equity in income (3) (4)
14.8
 7.8
 6.8
 
(1)In December 2019, one of the funds sold 1 operating property comprised of 270 apartment homes for approximately $38.5 million.
(2)Net income for the year ended December 31, 2017 includes approximately $1.3 million of property expense relating to Hurricanes Harvey and Irma in the third quarter of 2017.
(3)Equity in income excludes our ownership interest of fee income from various services provided by us to the Funds.
(4)Equity in income for the year ended December 31, 2019 includes our ownership interest of the gain on sale of the operating property of approximately $6.2 million. Equity in income for the year ended December 31, 2017 includes our ownership interest of the hurricane related insurance recoveries and expenses of approximately $0.4 million.
The Funds in which we have a partial interest have been funded in part with secured third-party debt. As of December 31, 2019, we had 0 outstanding guarantees related to debt of the Funds.
We may earn fees for property and asset management, construction, development, and other services related to joint ventures in which we own an equity interest and may earn a promoted equity interest if certain thresholds are met. We eliminate fee income for services provided to these joint ventures to the extent of our ownership. Fees earned for these services, net of eliminations, were approximately $6.8 million, $5.7 million, and $5.8 million for the years ended December 31, 2019, 2018, and 2017, respectively.

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9. Notes Payable
The following is a summary of our indebtedness:
  December 31,
(in millions) 2019 2018
Commercial banks    
Unsecured credit facility $44.0
 $
2.70% Term loan, due 2022 99.7
 99.6
  $143.7
 $99.6
  

 

Senior unsecured notes (1)
    
4.78% Notes, due 2021 $
 $249.1
3.15% Notes, due 2022 348.0
 347.3
5.07% Notes, due 2023 248.4
 248.0
4.36% Notes, due 2024 249.0
 248.7
3.68% Notes, due 2024 248.0
 247.6
3.74% Notes, due 2028 396.7
 396.1
3.67% Notes, due 2029 593.7
 
3.41% Notes, due 2049 296.6
 
  $2,380.4
 $1,736.8
     
Total unsecured notes payable $2,524.1
 $1,836.4
     
Secured notes    
4.38% Conventional Mortgage Loan, due 2045 $
 $45.9
5.19% Conventional Mortgage Notes, due 2019 
 419.9
5.33% Conventional Mortgage Loan, due 2019 
 19.4
  $
 $485.2
     
Total notes payable (1)
 $2,524.1
 $2,321.6
     
Value of real estate assets, at cost, subject to secured notes $
 $867.9

(1)Unamortized debt discounts and debt issuance costs of $19.9 million and $13.9 million are included in senior unsecured and secured notes payable as of December 31, 2019 and 2018, respectively.
In March 2019, we amended and restated our $600 million unsecured credit facility to, among other things, extend the maturity date from August 2019 to March 2023, with two options to further extend the facility at our election for two additional six month periods, and increase the facility from $600 million to $900 million, which may be expanded three times by up to an additional $500 million upon satisfaction of certain conditions. The interest rate on our unsecured credit facility is based upon the London Interbank Offered Rate ("LIBOR") plus a margin which is subject to change as our credit ratings change. Advances under our credit facility may be priced at the scheduled rates, or we may enter into bid rate loans with participating banks at rates below the scheduled rates. These bid rate loans have terms of 180 days or less and may not exceed the lesser of $450 million or the remaining amount available under our credit facility. Our credit facility is subject to customary financial covenants and limitations. We believe we are in compliance with all such financial covenants and limitations as of December 31, 2019 through the date of this filing.
Our credit facility provides us with the ability to issue up to $50 million in letters of credit. While our issuance of letters of credit does not increase our borrowings outstanding under our credit facility, it does reduce the amount available. At December 31, 2019, we had approximately $44.0 million of borrowings outstanding on our $900 million credit facility and we had outstanding letters of credit totaling approximately $8.9 million, leaving approximately $847.1 million available under our credit facility.
In the first quarter of 2019, we repaid approximately $439.3 million of secured conventional mortgage debt utilizing our unsecured credit facility and proceeds from our equity offering completed in February 2019.
In June 2019, we issued $600.0 million aggregate principal amount of 3.150% senior unsecured notes due July 1, 2029 (the "2029 Notes") under our existing shelf registration statement. The 2029 Notes were offered to the public at 99.751% of their face amount with a stated rate of 3.150% and a yield to maturity of 3.179%. In anticipation of the offering of the 2029 Notes, we

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initiated forward interest rate swap agreements with an aggregate notional amount of $300.0 million. After giving effect to the settlement of the swap agreements, which will be recognized over the first seven years of the 2029 Notes as discussed below in Note 10, "Derivative Financial Instruments and Hedging Activities," and deducting the underwriting discounts and other estimated expenses of the offering, the effective annual interest rate on the 2029 Notes is approximately 3.84% through June 2026, and approximately 3.28% thereafter, for an all-in average effective rate of approximately 3.67%. We received net proceeds of approximately $593.4 million, net of underwriting discounts and other estimated offering expenses. Interest on the 2029 Notes is payable semi-annually on January 1 and July 1, beginning January 1, 2020. We may redeem the 2029 Notes, in whole or in part, at any time at a redemption price equal to the principal amount and accrued interest of the notes being redeemed plus a make-whole provision. If, however, we redeem the 2029 Notes 90 days or fewer prior to the maturity date, the redemption price will equal 100% of the principal amount of the 2029 Notes to be redeemed plus accrued and unpaid interest on the amount being redeemed to the redemption date. The 2029 Notes are direct, senior unsecured obligations and rank equally with all of our other unsecured and unsubordinated indebtedness. We used the proceeds from the offering of the 2029 Notes to repay outstanding balances on our unsecured line of credit in June 2019, the prepayment of secured debt in late October 2019 (discussed below) and for general corporate purposes which included property development, capital expenditures, and working capital.
In October 2019, we issued $300.0 million aggregate principal amount of 3.350% senior unsecured notes due November 1, 2049 (the "2049 Notes") under our existing shelf registration statement. The 2049 Notes were offered to the public at 99.941% of their face amount with a stated rate of 3.350% and a yield to maturity of 3.353%. We received net proceeds of approximately $296.6 million, net of underwriting discounts and other estimated offering expenses. After giving effect to net underwriting discounts and other estimated offering expenses, the effective annual interest rate on the 2049 Notes is approximately 3.41%. Interest on the 2049 Notes is payable semi-annually on May 1 and November 1, beginning May 1, 2020. We may redeem the 2049 Notes, in whole or in part, at any time at a redemption price equal to the principal amount and accrued interest of the notes being redeemed, plus a make-whole provision. If, however, we redeem the 2049 Notes within six months of the maturity date, the redemption price will equal 100% of the principal amount of the 2049 Notes to be redeemed plus accrued and unpaid interest on the amount being redeemed to the redemption date. The 2049 Notes are direct, senior unsecured obligations and rank equally with all of our other unsecured and unsubordinated indebtedness.
In October 2019, we used the net proceeds from the 2049 Notes, together with cash on hand, to fund the early redemption of all of the $250 million aggregate principal amount of our 4.78% effective rate Senior Notes due 2021, plus a make-whole premium and accrued and unpaid interest to the date of redemption, and to prepay all of the approximately $45.3 million aggregate principal amount of our 4.38% secured conventional mortgage note due 2045, plus a prepayment premium and interest to the date of repayment. In connection with these transactions, we recorded an approximate $12 million loss on early retirement of debt in the fourth quarter of 2019.
At December 31, 2019, we had $143.7 million outstanding floating rate debt, which included amounts borrowed under our unsecured credit facility, with a weighted average interest rate of approximately 2.7%. At December 31, 2018, we had outstanding floating rate debt of approximately $99.6 million with a weighted average interest rate of approximately 3.3%.
Our indebtedness, which includes our unsecured credit facility, had a weighted average maturity of 8.9 years at December 31, 2019. The table below is a summary of the maturity dates of our outstanding debt and principal amortizations, and the weighted average interest rates on such debt, at December 31, 2019:
(in millions) (1) 
Amount (2)
 
Weighted Average
Interest Rate (3)
2020 $(3.1) %
2021 (3.1) 
2022 447.0
 3.1
2023 247.9
 5.1
2024 (4)
 542.6
 3.9
Thereafter 1,292.8
 3.7
Total $2,524.1
 3.8%

(1)Includes all available extension options.
(2)Includes amortization of debt discounts and debt issuance costs.
(3)Includes the effects of the applicable settled forward interest rate swaps.
(4)
Includes $44.0 million of borrowings outstanding under our unsecured credit facility.

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10. Derivative Financial Instruments and Hedging Activities
Risk Management Objective of Using Derivatives. We are exposed to certain risks arising from both our business operations and economic conditions. We principally manage our exposures to a wide variety of business and operational risks through management of our core business activities. We manage economic risks, including interest rate, liquidity, and credit risk, primarily by managing the amount, sources, and duration of our debt funding and the use of derivative financial instruments. Specifically, we may enter into derivative financial instruments to manage exposures arising from business activities resulting in differences in the amount, timing, and duration of our known or expected cash payments principally related to our borrowings. See Note 2, "Summary of Significant Accounting Policies and Recent Accounting Pronouncements" for a further discussion of derivative financial instruments.
Cash Flow Hedges of Interest Rate Risk. Our objectives in using interest rate derivatives are to add stability to interest expense and to manage our exposure to interest rate movements. To accomplish these objectives, we primarily use interest rate swaps and caps as part of our interest rate risk management strategy. Interest rate swaps involve the receipt of variable rate amounts from a counterparty in exchange for us making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. Interest rate caps involve the receipt of variable rate amounts from a counterparty if interest rates rise above the strike rate on the contract in exchange for an upfront premium.
Designated Hedges. The gain or loss on the derivatives designated and qualifying as cash flow hedges is reported as a component of other comprehensive income or loss and subsequently reclassified into earnings in the period the hedged forecasted transaction affects earnings and presented in the same line item as the earnings effect of the hedged item.
In connection with the 2029 Notes issued in June 2019, we settled all of our remaining outstanding forward interest rate swaps with a total notional value of $300.0 million resulting in a net cash payment of approximately $20.4 million. Amounts in other comprehensive income associated with the settled forward interest rate swaps will be reclassified to interest expense over the first seven years of the 2029 Notes. In connection with the 2028 Notes issued in October 2018, we settled forward interest rate swaps with a total notional value of $400.0 million resulting in a net cash receipt of approximately $15.9 million. Amounts in other comprehensive income associated with the settled forward interest rate swaps will be reclassified to interest expense over the life of the 2028 Notes. At December 31, 2019, we had no designated hedges outstanding. At December 31, 2018, we had a total of 2 designated hedges outstanding with a total notional value of $300.0 million to hedge a portion of anticipated future fixed rate debt issuances in 2019.
Non-Designated Hedges. Derivatives are not entered into for trading or speculative purposes and are used to manage our exposure to interest rate movements and other identified risks. Our non-designated hedges are either specifically non-designated by management or do not meet strict hedge accounting requirements. Changes in the fair value of derivatives not designated in hedging relationships are recorded directly in earnings in interest and other income. At December 31, 2019 and 2018, we did not have any non-designated hedges outstanding.
The table below presents the fair value of our derivative financial instruments as well as their classification in the consolidated balance sheets at December 31, 2019 and 2018:
 Asset Derivatives Liability Derivatives
 December 31, 2019 December 31, 2018 December 31, 2019 December 31, 2018
 (in millions)Balance Sheet
Location
 Fair
Value
 Balance Sheet
Location
 Fair
Value
 Balance Sheet
Location
 Fair
Value
 Balance Sheet
Location
 Fair
Value
Derivatives Designated as Hedging Instruments               
Interest Rate SwapsOther Assets $
 Other Assets $
 Other Liabilities $
 Other Liabilities $7.4

The table below presents the effect of our derivative financial instruments in the consolidated statements of income and comprehensive income for the year ended December 31, 2019 and 2018:
 (in millions) 
Unrealized Gain (Loss)
Recognized in Other
Comprehensive  Income
(“OCI”) on Derivatives
 Location of Gain
Reclassified from
Accumulated OCI into Income
 Amount of Gain
Reclassified from
Accumulated OCI
into Income
Derivatives in Cash Flow Hedging Relationships 2019 2018 2017   2019 2018 2017
Interest Rate Swaps $(13.0) $6.8
 $1.7
 Interest expense $0.1
 $0.4
 $

As of December 31, 2019, the amount we expect to be reclassified into earnings in the next 12 months as an increase to interest expense is approximately $1.3 million.

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11. Share-based Compensation and Benefit Plans
Incentive Compensation. We currently maintain the 2018 Share Incentive Plan (the “2018 Share Plan”) and the 2011 Share Incentive Plan (the “2011 Share Plan”), although no new awards may be granted under the 2011 Plan. Each of these plans were approved by the Company’s shareholders. The shares available for awards under the 2018 Share Plan are, subject to certain other limits under the plan, generally available for any type of award authorized under the 2018 Share Plan, including stock options, stock appreciation rights, restricted stock awards, stock bonuses and other stock-based awards. Persons eligible to receive awards under the 2018 Share Plan include officers and employees of the Company or any of its subsidiaries, Trust Managers of the Company, and certain consultants and advisors to the Company or any of its subsidiaries. A total of 9.7 million shares (“Share Limit”) was authorized under the 2018 Share Plan. Shares issued or to be issued are counted against the Share Limit as set forth as (1) 3.45 to 1.0 for every share award, excluding stock options and share appreciation rights, granted, and (2) 1.0 to 1.0 for every share of stock option or share appreciation right granted. As of December 31, 2019, there were approximately 7.6 million common shares available under the 2018 Share Plan, which would result in approximately 2.2 million shares which could be granted pursuant to full value awards conversion ratios as defined under the plan.
Total compensation cost for option and share awards charged against income was approximately $16.8 million, $17.8 million, and $18.8 million for 2019, 2018 and 2017, respectively. Total capitalized compensation cost for option and share awards was approximately $3.4 million, $3.0 million, and $3.8 million for the years ended December 31, 2019, 2018, and 2017, respectively.
A summary of activity under our share incentive plans for the year ended December 31, 2019 is shown below:
  
Nonvested
Share
Awards
Outstanding
 
Weighted
Average
Exercise  /
Grant Price
Nonvested share awards outstanding at December 31, 2018 390,681
 $79.82
Granted 199,957
 98.84
Exercised/Vested (308,514) 82.65
Forfeited (17,470) 86.64
Total nonvested share awards outstanding at December 31, 2019 264,654
 $90.44

Options. Stock options other than reload options have a contractual life of ten years and vest over periods up to three years. Reload options vest at the grant date. Reload options are granted for the number of shares tendered as payment for the exercise price upon the exercise of an option with a reload provision. The reload options granted had an exercise price equal to the fair market value of a common share on the date of grant and expired on the same date as the original options which were exercised. None of our current incentive compensation plans carry reload option rights, and all of our obligations relating to reload options have been satisfied as of December 31, 2018. Expense for stock options is based on grant date fair value and recognized on a straight-line method over the vesting period.
We estimate the fair values of each option award on the date of grant using the Black-Scholes option pricing model. There were no options granted in December 31, 2019. The weighted-average fair value of reload stock options granted during the years ended December 31, 2018 and 2017 and the weighted-average assumptions for such grants were as follows:
  Year Ended
December 31, 2018
 
Year Ended
December 31, 2017
Weighted average fair value of options granted $4.11 $5.25
Expected volatility 15.1% 18.9%
Risk-free interest rate 2.0% 1.3%
Expected dividend yield 3.3% 5.5%
Expected life 1 year 2 years

Our computations of expected volatility for 2018 and 2017 were based on the historical volatility of our common shares over a time period equal to the expected life of the option and ending on the grant date, and the interest rate for periods within the contractual life of the award is based on the U.S. Treasury yield curve in effect at the time of grant. The expected dividend yield on our common shares was based on the historical dividend yield over the expected term of the options granted. Our computation of expected life was based upon historical experience of similar awards, giving consideration to the contractual terms of the share-based awards.

F-24


The total intrinsic value of options exercised was approximately $2.0 million and $2.2 million during the years ended December 31, 2018 and 2017, respectively. At December 31, 2019, there was no unrecognized compensation cost related to unvested options and there were no options outstanding.
Share Awards and Vesting. Share awards for employees generally vest over three years and are valued at the market value of the shares on the grant date. In the event the holder of the share awards attains at least age 65, and with respect to employees, also attain at least ten or more years of service ("Retirement Eligibility") before the term in which the awards are scheduled to vest, the value of the share awards is amortized from the date of grant to the individual's Retirement Eligibility date.
At December 31, 2019, 2018 and 2017, the weighted average fair value of share awards granted was $98.84, $82.81 and $83.41, respectively. The total fair value of shares vested during the years ended December 31, 2019, 2018 and 2017 was approximately $25.5 million, $24.0 million, and $23.1 million, respectively. At December 31, 2019, the unamortized value of previously issued unvested share awards was approximately $13.5 million which is expected to be amortized over the next two years.
Employee Share Purchase Plan (“ESPP”). In May 2018, our shareholders approved the 2018 Employee Share Purchase Plan (the "2018 ESPP") which amends and restates our 1999 Employee Share Purchase Plan (the "1999 ESPP") effective with the offering period commencing in June 2018. Under the 2018 ESPP, we may issue up to a total of approximately 500,000 common shares. The 2018 ESPP permits eligible employees to purchase our common shares either through payroll deductions or through semi-annual contributions. Each offering period has a six month duration commencing in June and December for which shares may be purchased at 85% of the market value, as defined on the first or last day of the offering period, whichever price is lower. We currently use treasury shares to satisfy ESPP share requirements. Each participant must hold the shares purchased for nine months in order to receive the discount, and a participant may not purchase more than $25,000 in value of shares during any plan year, as defined. The following table presents information related to our ESPP:
 2019 2018 2017
Shares purchased22,032
 15,330
 18,986
Weighted average fair value of shares purchased$105.93
 $90.93
 $89.89
Expense recorded (in millions)$0.4
 $0.2
 $0.3

Rabbi Trust. We established a rabbi trust for a select group of participants in which share awards granted under the share incentive plan and salary and other cash amounts earned may be deposited. The rabbi trust is only in use for deferrals made prior to 2005, including bonuses related to service in 2004 but paid in 2005. The rabbi trust is an irrevocable trust and no portion of the trust fund may be used for any purpose other than the delivery of those assets to the participants. The assets held in the rabbi trust are subject to the claims of our general creditors in the event of bankruptcy or insolvency.
The value of the assets of the rabbi trust is consolidated into our financial statements. Granted share awards held by the rabbi trust are classified in equity in a manner similar to the manner in which treasury stock is accounted. Subsequent changes in the fair value of the shares are not recognized. The deferred compensation obligation is classified as an equity instrument and changes in the fair value of the amount owed to the participant are not recognized. At December 31, 2019 and 2018, approximately 1.4 million and 1.7 million share awards, respectively were held in the rabbi trust. Additionally, as of December 31, 2019 and 2018, the rabbi trust held trading securities totaling approximately $12.5 million and $14.9 million, respectively, which represents cash deferrals made by plan participants. Market value fluctuations on these trading securities are recognized in income in accordance with GAAP and the liability due to participants is adjusted accordingly.
At December 31, 2019 and 2018, approximately $17.3 million and $21.2 million, respectively, was required to be paid to us by plan participants upon the withdrawal of any assets from the rabbi trust, and is included in “Accounts receivable-affiliates” in our consolidated financial statements.
Non-Qualified Deferred Compensation. In 2004, we established a Non-Qualified Deferred Compensation Plan which is an unfunded arrangement established and maintained primarily for the benefit of a select group of participants. Eligible participants commence participation in this plan on the date the deferral election first becomes effective. We credit to the participant's account an amount equal to the amount designated as the participant's deferral for the plan year as indicated in the participant's deferral election(s). Any modification to or termination of the plan will not reduce a participant's right to any vested amounts already credited to his or her account. Approximately 0.8 million and 0.7 million share awards were held in the plan at December 31, 2019 and 2018, respectively. Additionally, as of December 31, 2019 and 2018, the plan held trading securities totaling approximately $139.3 million and $129.8 million, respectively, which represents cash deferrals made by plan participants and diversification of share awards within the plan to trading securities. Market value fluctuations on these trading securities are recognized in income in accordance with GAAP and the liability due to participants is adjusted accordingly. The assets held in the Non-Qualified Deferred Compensation Plan are subject to the claims of our general creditors in the event of bankruptcy or insolvency.

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Balances within temporary equity in our consolidated balance sheets related to fully vested awards and the proportionate share of nonvested awards of participants within our Non-Qualified Deferred Compensation Plan who were permitted to diversify their shares into other equity securities subject to a six-month holding period. In December 2018, the plan was amended and restated and effective January 1, 2019 participants in the Non-Qualified Deferred Compensation Plan were no longer able to diversify their common shares; accordingly, the fully vested share awards and the proportionate share of nonvested share awards previously eligible for diversification were reclassified on the effective date from temporary equity into additional paid-in capital in our consolidated balance sheet.
The following table summarizes the eligible share award activity for the years ended December 31, 2018 and 2017:
(in thousands) 2018 2017
Temporary equity:    
Balance at beginning of period $77,230
 $77,037
Change in classification 16,407
 13,388
Change in redemption value (669) 10,038
Diversification of share awards (429 shares during December 31, 2018) (40,294) (23,233)
Balance at December 31 $52,674
 $77,230

401(k) Savings Plan. We have a 401(k) savings plan, which is a voluntary defined contribution plan, which provides participating employees the ability to elect to contribute up to 60 percent of eligible compensation, subject to limitations as defined by the federal tax code, with the Company making matching contributions up to a predetermined limit. The matching contributions made for the years ended December 31, 2019, 2018, and 2017 were approximately $3.1 million, $2.9 million, and $2.7 million, respectively. Employees become vested in our matching contributions 33% after one year of service, 67% after two years of service and 100% after three years of service.
12. Fair Value Measurements
Recurring Fair Value Disclosures. The following table presents information about our financial instruments measured at fair value on a recurring basis as of December 31, 2019 and 2018 using the inputs and fair value hierarchy discussed in Note 2, “Summary of Significant Accounting Policies and Recent Accounting Pronouncements”:
Financial Instruments Measured at Fair Value on a Recurring Basis
 December 31, 2019 December 31, 2018
 (in millions)
Quoted 
Prices in
Active Markets
for Identical
Assets (Level 1)
 
Significant
Other
Observable
Inputs 
(Level 2)
 
Significant
Unobservable
Inputs
(Level 3)
 Total 
Quoted
 Prices in
Active Markets
for Identical
Assets (Level 1)
 
Significant
Other
Observable
Inputs
 (Level 2)
 
Significant
Unobservable
Inputs
(Level 3)
 Total
Other Assets               
Deferred compensation plan investments (1)
$151.8
 $
 $
 $151.8
 $144.7
 $
 $
 $144.7
Other Liabilities               
Derivative financial instruments - forward interest rate swaps$
 $
 $
 $
 $
 $7.4
 $
 $7.4

(1)Approximately $18.0 million and $12.7 million of participant cash was withdrawn from our deferred compensation plan investments during the years ended December 31, 2019 and 2018, respectively. Approximately $40.3 million of shares within the deferred compensation plan were diversified into other deferred compensation plan investments during the year ended 2018.
Nonrecurring Fair Value Disclosures. The nonrecurring fair value disclosures inputs under the fair value hierarchy are discussed in Note 2, “Summary of Significant Accounting Policies and Recent Accounting Pronouncements.” We completed 4 asset acquisitions of operating properties during the year ended December 31, 2019 and 3 asset acquisitions of operating properties during the year ended December 31, 2018. We recorded the real estate assets and identifiable above and below market and in-place leases at their relative fair values based upon methods similar to those used by independent appraisers of income producing properties. The fair value measurements associated with the valuation of these acquired assets represent Level 3 measurements within the fair value hierarchy. See Note 7, "Acquisitions and Dispositions" for a further discussion about these acquisitions.

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Financial Instrument Fair Value Disclosures. The following table presents the carrying and estimated fair values of our notes payable at December 31, 2019 and 2018, in accordance with the policies discussed in Note 2, "Summary of Significant Accounting Policies and Recent Accounting Pronouncements."
 
 December 31, 2019 December 31, 2018
(in millions)
Carrying
Value
 
Estimated
Fair Value
 
Carrying
Value
 
Estimated
Fair Value
Fixed rate notes payable$2,380.4
 $2,533.5
 $2,222.0
 $2,265.4
Floating rate notes payable (1)
143.7
 143.8
 99.6
 99.4

(1)Includes balances outstanding under our unsecured credit facility at December 31, 2019.

13. Net Change in Operating Accounts
The effect of changes in the operating accounts and other on cash flows from operating activities is as follows:
 
 Year Ended December 31,
(in thousands)2019 2018 2017
Change in assets:     
Other assets, net$(6,976) $10,364
 $(6,724)
Change in liabilities:     
Accounts payable and accrued expenses19,713
 (4,133) (2,300)
Accrued real estate taxes(1,014) 1,910
 2,342
Other liabilities23,119
 (1,486) (995)
Other3,252
 2,898
 2,831
Change in operating accounts and other$38,094
 $9,553
 $(4,846)

14. Commitments and Contingencies
Construction Contracts. As of December 31, 2019, we estimate the additional cost to complete the 7 consolidated projects currently under construction to be approximately $358.6 million. We expect to fund this amount through a combination of one or more of the following: cash flows generated from operations, draws on our unsecured credit facility, the use of debt and equity offerings under our automatic shelf registration statement, proceeds from property dispositions, equity issued from our ATM programs, other unsecured borrowings or secured mortgages.
Litigation. We are subject to various legal proceedings and claims which arise in the ordinary course of business. Matters which arise out of allegations of bodily injury, property damage, and employment practices are generally covered by insurance. While the resolution of these legal proceedings and claims cannot be predicted with certainty, management believes the final outcome of such matters will not have a material adverse effect on our consolidated financial statements.
Other Commitments and Contingencies. In the ordinary course of our business, we issue letters of intent indicating a willingness to negotiate for acquisitions, dispositions, or joint ventures and also enter into arrangements contemplating various transactions. Such letters of intent and other arrangements are non-binding as to either party unless and until a definitive contract is entered into by the parties. Even if definitive contracts relating to the purchase or sale of real property are entered into, these contracts generally provide the purchaser with time to evaluate the property and conduct due diligence, during which periods the purchaser will have the ability to terminate the contracts without penalty or forfeiture of any deposit or earnest money. There can be no assurance definitive contracts will be entered into with respect to any matter covered by letters of intent or we will consummate any transaction contemplated by any definitive contract. Furthermore, due diligence periods for real property are frequently extended as needed. An acquisition or sale of real property becomes probable at the time the due diligence period expires and the definitive contract has not been terminated. We are then at risk under a real property acquisition contract, but generally only to the extent of any earnest money deposits associated with the contract, and are obligated to sell under a real property sales contract. At December 31, 2019, we had approximately $0.9 million in refundable earnest money deposits for potential acquisitions of operating properties and land and are included in other assets, net in our consolidated balance sheet. Of this $0.9 million in refundable earnest money deposits, approximately $0.2 million was related to the acquisition of land in Raleigh, North Carolina which was completed in January 2020.

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Lease Commitments. Substantially all of our operating leases recorded in our consolidated balance sheets at January 1, 2019 upon adoption of ASC 842 are related to office facility leases. The lease and non-lease components are accounted for as a combined single component based upon the standalone price at the time the applicable lease is commenced and is recognized as a lease expense on a straight-line basis over the lease term. Most of our office facility leases include options to renew and generally are not included in the operating lease liabilities or right-of-use ("ROU") assets as they are not reasonably certain of being exercised. If an option to renew is exercised, it would be considered a separate contract and recognized based upon the standalone price at the time the option to renew is exercised. Variable lease payments which values are not known at lease commencement, such as executory costs of real estate taxes, property insurance, and common area maintenance, are expensed as incurred.
As of December 31, 2019, we had no significant leases executed but not yet commenced and did not record any impairment charges related to our ROU assets. The following is a summary of our operating lease related information:
($ in millions)   As of
Balance sheet Classification December 31, 2019
   Right-of-use assets, net Other assets, net $10.6
   Operating lease liabilities Other liabilities $15.0
($ in millions)   Year ended
Statement of income and comprehensive income Classification December 31, 2019
Rent expense related to operating lease liabilities General and administrative expenses and property management expenses $2.9
   Variable lease expense General and administrative expenses and property management expenses $1.4
($ in millions)   Year ended
Statement of cash flows Classification December 31, 2019
   Cash flows from operating leases Net cash from operating activities $3.1
Supplemental lease information    
   Weighted average remaining lease term (years) 5.3
   Weighted average discount rate - operating leases (1)
 4.9%
(1)We use a secured incremental borrowing rate, as defined by ASC 842 based on an estimated secured rate with applicable adjustments, as most of our lease contracts do not provide a readily determinable implicit rate.
The following is a summary of our maturities of our lease liabilities as of December 31, 2019:
(in millions) 
Year ended December 31,Operating Leases
2020$3.4
20213.2
20222.9
20232.7
20242.8
Thereafter2.1
Less: discount for time value(2.1)
Lease liability as of December 31, 2019$15.0

Prior to our adoption of ASU 2016-12, rental expense for the years ended December 31, 2018 and 2017 were approximately $3.8 million and $4.0 million, respectively. Minimum annual rental commitments as of December 31, 2018 for the years ending December 31, 2019 through 2023 were approximately $2.9 million, $3.0 million, $3.1 million, $2.7 million and $2.6 million, respectively, and approximately $4.5 million in the aggregate thereafter.
Investments in Joint Ventures. We have entered into, and may continue in the future to enter into, joint ventures or partnerships (including limited liability companies) through which we own an indirect economic interest in less than 100% of the community or land owned directly by the joint venture or partnership. Our decision whether to hold the entire interest in an apartment community or land ourselves, or to have an indirect interest in the community or land through a joint venture or partnership, is based on a variety of factors and considerations, including: (i) our projection, in some circumstances, that we will achieve higher returns on

F-28


our invested capital or reduce our risk if a joint venture or partnership vehicle is used; (ii) our desire to diversify our portfolio of investments by market; (iii) our desire at times to preserve our capital resources to maintain liquidity or balance sheet strength; and (iv) the economic and tax terms required by a seller of land or of a community, who may prefer or who may require less payment if the land or community is contributed to a joint venture or partnership. Investments in joint ventures or partnerships are not limited to a specified percentage of our assets. Each joint venture or partnership agreement is individually negotiated, and our ability to operate or dispose of land or of a community in our sole discretion may be limited to varying degrees in our existing joint venture agreements and may be limited to varying degrees depending on the terms of future joint venture agreements.
Employment Agreements. At December 31, 2019, we had employment agreements with 13 of our senior officers, the terms of which expire at various times through August 20, 2020. Such agreements provide for minimum salary levels as well as various incentive compensation arrangements, which are payable based on the attainment of specific goals. The agreements also provide for severance payments plus a gross-up payment if certain situations occur, such as termination without cause or a change of control. In the case of 10 of the agreements, the severance payment equals one times the respective current annual base salary in the case of termination without cause and 2.99 times the respective average annual base salary over the previous three fiscal years in the case of a change of control and a termination of employment or a material adverse change in the scope of their duties. In the case of one agreement, the severance payment equals one times the respective current annual base salary for termination without cause and 2.99 times the greater of current gross income or average gross income over the previous three fiscal years in the case of a change of control. In the case of the other two agreements, the severance payment generally equals 2.99 times the respective average annual compensation over the previous three fiscal years in connection with, among other things, a termination without cause or a change of control, and the officer would be entitled to receive continuation and vesting of certain benefits in the case of such termination.
15. Quarterly Financial Data (unaudited)
Summarized quarterly financial data for the years ended December 31, 2019 and 2018, is as follows:
 
(in thousands, except per share amounts)First Second Third Fourth 
Total (a)
2019:         
Revenues$248,567
 $255,761
 $260,672
 $263,461
 $1,028,461
Net income attributable to common shareholders38,613
 42,399
 43,597
 95,014
(b)219,623
Total earnings per share – basic0.40
 0.43
 0.44
 0.96
(b)2.23
Total earnings per share – diluted0.40
 0.43
 0.44
 0.95
(b)2.22
2018:         
Revenues$230,683
 $237,133
 $241,770
 $244,919
 $954,505
Net income attributable to common shareholders39,395
 38,671
 38,866
 39,196
 156,128
Total earnings per share – basic0.41
 0.40
 0.41
 0.41
 1.63
Total earnings per share – diluted0.41
 0.40
 0.40
 0.41
 1.63
(a)Net income per share is computed independently for each of the quarters presented. Therefore, the sum of quarterly net income per share amounts may not equal the total computed for the year.
(b)
Includes a $11,995 or $0.12 basic and diluted per share, impact related to the loss on early retirement of debt in October 2019. Also includes a $49,901 or $0.50 basic and $0.49 diluted per share, impact related to a gain on sale of 2 consolidated operating properties.

F-29


 
Camden Property Trust
Real Estate and Accumulated Depreciation
As of December 31, 2019
(in thousands)
Schedule III
 Initial Cost   Total Cost      
 Land 
Building/
Construction
in Progress &
Improvements
 
Cost 
Subsequent to
Acquisition/
Construction
 Land 
Building/
Construction
in Progress &
Improvements
 Total 
Accumulated
Depreciation
 
Total Cost,
Net of
Accumulated
Depreciation
 
Year of
Completion/
Acquisition
Current communities (1):
                 
                  
ARIZONA                 
       Phoenix/Scottsdale                 
              Camden Chandler$5,511
 $62,429
 $353
 $5,511
 $62,782
 $68,293
 $11,766
 $56,527
 2016
              Camden Copper Square4,825
 23,672
 8,859
 4,825
 32,531
 37,356
 20,332
 17,024
 2000
              Camden Foothills11,006
 33,712
 328
 11,006
 34,040
 45,046
 7,454
 37,592
 2014
              Camden Hayden9,248
 35,254
 262
 9,248
 35,516
 44,764
 7,259
 37,505
 2015
              Camden Legacy4,068
 26,612
 18,905
 4,068
 45,517
 49,585
 28,933
 20,652
 1998
              Camden Montierra13,687
 31,727
 5,891
 13,687
 37,618
 51,305
 10,733
 40,572
 2012
              Camden North End16,108
 82,620
 68
 16,108
 82,688
 98,796
 8,346
 90,450
 2019
              Camden Old Town Scottsdale23,227
 71,784
 1,832
 23,227
 73,616
 96,843
 4,211
 92,632
 2019
              Camden Pecos Ranch3,362
 24,492
 6,044
 3,362
 30,536
 33,898
 10,541
 23,357
 2012
              Camden San Marcos11,520
 35,166
 6,441
 11,520
 41,607
 53,127
 12,171
 40,956
 2012
              Camden San Paloma6,480
 23,045
 11,173
 6,480
 34,218
 40,698
 19,292
 21,406
 2002
              Camden Sotelo3,376
 30,576
 1,665
 3,376
 32,241
 35,617
 7,522
 28,095
 2013
CALIFORNIA                 
       Los Angeles/Orange County                 
              Camden Crown Valley9,381
 54,210
 11,280
 9,381
 65,490
 74,871
 37,277
 37,594
 2001
              Camden Glendale21,492
 96,158
 180
 21,492
 96,338
 117,830
 17,563
 100,267
 2015
              Camden Harbor View16,079
 127,459
 29,477
 16,079
 156,936
 173,015
 72,266
 100,749
 2003
              Camden Main and Jamboree17,363
 75,387
 2,782
 17,363
 78,169
 95,532
 23,382
 72,150
 2008
              Camden Martinique28,401
 51,861
 27,676
 28,401
 79,537
 107,938
 49,477
 58,461
 1998
              Camden Sea Palms4,336
 9,930
 8,280
 4,336
 18,210
 22,546
 10,683
 11,863
 1998
              The Camden18,286
 118,730
 337
 18,286
 119,067
 137,353
 18,101
 119,252
 2016
       San Diego/Inland Empire                 
              Camden Landmark17,339
 71,315
 3,789
 17,339
 75,104
 92,443
 19,580
 72,863
 2012
              Camden Old Creek20,360
 71,777
 9,397
 20,360
 81,174
 101,534
 32,105
 69,429
 2007
              Camden Sierra at Otay Ranch10,585
 49,781
 10,662
 10,585
 60,443
 71,028
 29,713
 41,315
 2003
              Camden Tuscany3,330
 36,466
 6,639
 3,330
 43,105
 46,435
 21,530
 24,905
 2003
              Camden Vineyards4,367
 28,494
 5,189
 4,367
 33,683
 38,050
 18,091
 19,959
 2002
COLORADO                 
       Denver                 
              Camden Belleview Station8,091
 44,003
 5,790
 8,091
 49,793
 57,884
 12,182
 45,702
 2012
              Camden Caley2,047
 17,445
 10,096
 2,047
 27,541
 29,588
 15,303
 14,285
 2000
              Camden Denver West$6,396
 $51,552
 $12,633
 $6,396
 $64,185
 $70,581
 $16,661
 $53,920
 2012
              Camden Flatirons6,849
 72,631
 855
 6,849
 73,486
 80,335
 15,824
 64,511
 2015
              Camden Highlands Ridge2,612
 34,726
 22,996
 2,612
 57,722
 60,334
 31,611
 28,723
 1996
              Camden Interlocken5,293
 31,612
 19,410
 5,293
 51,022
 56,315
 28,633
 27,682
 1999
              Camden Lakeway3,915
 34,129
 26,754
 3,915
 60,883
 64,798
 34,940
 29,858
 1997
              Camden Lincoln Station4,648
 51,762
 309
 4,648
 52,071
 56,719
 7,503
 49,216
 2017
WASHINGTON DC METRO                 
              Camden Ashburn Farm4,835
 22,604
 6,009
 4,835
 28,613
 33,448
 12,767
 20,681
 2005
              Camden College Park16,409
 91,503
 7,579
 16,409
 99,082
 115,491
 28,675
 86,816
 2008
              Camden Dulles Station10,807
 61,548
 9,357
 10,807
 70,905
 81,712
 24,907
 56,805
 2008
              Camden Fair Lakes15,515
 104,223
 14,105
 15,515
 118,328
 133,843
 53,166
 80,677
 2005
              Camden Fairfax Corner8,484
 72,953
 10,162
 8,484
 83,115
 91,599
 36,257
 55,342
 2006
              Camden Fallsgrove9,408
 43,647
 6,107
 9,408
 49,754
 59,162
 23,071
 36,091
 2005
              Camden Grand Parc7,688
 35,900
 3,891
 7,688
 39,791
 47,479
 17,257
 30,222
 2005
              Camden Lansdowne15,502
 102,267
 26,380
 15,502
 128,647
 144,149
 55,180
 88,969
 2005
              Camden Largo Town Center8,411
 44,163
 4,661
 8,411
 48,824
 57,235
 21,706
 35,529
 2005
              Camden Monument Place9,030
 54,089
 7,618
 9,030
 61,707
 70,737
 23,110
 47,627
 2007
              Camden NoMa19,442
 82,306
 405
 19,442
 82,711
 102,153
 20,114
 82,039
 2014
              Camden NoMa II17,331
 91,211
 102
 17,331
 91,313
 108,644
 19,201
 89,443
 2017
              Camden Potomac Yard16,498
 88,317
 11,856
 16,498
 100,173
 116,671
 35,674
 80,997
 2008
              Camden Roosevelt11,470
 45,785
 5,669
 11,470
 51,454
 62,924
 21,963
 40,961
 2005
              Camden Russett13,460
 61,837
 7,631
 13,460
 69,468
 82,928
 31,431
 51,497
 2005
              Camden Shady Grove24,177
 89,820
 236
 24,177
 90,056
 114,233
 15,388
 98,845
 2018
              Camden Silo Creek9,707
 45,301
 8,646
 9,707
 53,947
 63,654
 22,983
 40,671
 2005
              Camden Washingtonian13,512
 75,134
 38
 13,512
 75,172
 88,684
 7,453
 81,231
 2018
FLORIDA                 
       Southeast Florida                 
              Camden Aventura12,185
 47,616
 14,567
 12,185
 62,183
 74,368
 30,092
 44,276
 2005
              Camden Boca Raton2,201
 50,057
 435
 2,201
 50,492
 52,693
 10,690
 42,003
 2014
              Camden Brickell14,621
 57,031
 32,064
 14,621
 89,095
 103,716
 36,848
 66,868
 2005
              Camden Doral10,260
 40,416
 7,769
 10,260
 48,185
 58,445
 22,353
 36,092
 2005
              Camden Doral Villas6,476
 25,543
 7,881
 6,476
 33,424
 39,900
 16,294
 23,606
 2005
              Camden Las Olas12,395
 79,518
 28,185
 12,395
 107,703
 120,098
 44,737
 75,361
 2005
              Camden Plantation6,299
 77,964
 13,767
 6,299
 91,731
 98,030
 41,354
 56,676
 2005
              Camden Portofino9,867
 38,702
 10,387
 9,867
 49,089
 58,956
 22,310
 36,646
 2005
       Orlando                 
              Camden Hunter's Creek$4,156
 $20,925
 $6,337
 $4,156
 $27,262
 $31,418
 $13,356
 $18,062
 2005
              Camden Lago Vista3,497
 29,623
 6,301
 3,497
 35,924
 39,421
 17,112
 22,309
 2005
              Camden LaVina12,907
 42,617
 1,306
 12,907
 43,923
 56,830
 13,395
 43,435
 2012
              Camden Lee Vista4,350
 34,643
 11,443
 4,350
 46,086
 50,436
 26,129
 24,307
 2000
              Camden North Quarter9,990
 68,471
 1,038
 9,990
 69,509
 79,499
 8,057
 71,442
 2018
              Camden Orange Court5,319
 40,733
 3,813
 5,319
 44,546
 49,865
 17,210
 32,655
 2008
              Camden Thornton Park11,711
 74,628
 764
 11,711
 75,392
 87,103
 5,843
 81,260
 2018
              Camden Town Square13,127
 45,997
 1,093
 13,127
 47,090
 60,217
 13,085
 47,132
 2012
              Camden World Gateway5,785
 51,821
 8,612
 5,785
 60,433
 66,218
 27,663
 38,555
 2005
       Tampa/St. Petersburg                 
              Camden Bay7,450
 63,283
 23,090
 7,450
 86,373
 93,823
 47,472
 46,351
 1998/2002
              Camden Montague3,576
 16,534
 785
 3,576
 17,319
 20,895
 5,376
 15,519
 2012
              Camden Pier District16,704
 105,383
 1,271
 16,704
 106,654
 123,358
 12,714
 110,644
 2018
              Camden Preserve1,206
 17,982
 11,267
 1,206
 29,249
 30,455
 18,995
 11,460
 1997
              Camden Royal Palms2,147
 38,339
 4,283
 2,147
 42,622
 44,769
 17,259
 27,510
 2007
              Camden Westchase Park11,955
 36,254
 825
 11,955
 37,079
 49,034
 10,626
 38,408
 2012
GEORGIA                 
       Atlanta                 
              Camden Brookwood7,174
 31,984
 10,702
 7,174
 42,686
 49,860
 20,559
 29,301
 2005
              Camden Buckhead Square13,200
 43,785
 894
 13,200
 44,679
 57,879
 4,930
 52,949
 2017
              Camden Creekstone5,017
 19,912
 5,492
 5,017
 25,404
 30,421
 7,137
 23,284
 2012
              Camden Deerfield4,895
 21,922
 9,717
 4,895
 31,639
 36,534
 15,389
 21,145
 2005
              Camden Dunwoody5,290
 23,642
 9,812
 5,290
 33,454
 38,744
 16,870
 21,874
 2005
              Camden Fourth Ward10,477
 51,258
 1,621
 10,477
 52,879
 63,356
 11,789
 51,567
 2014
              Camden Midtown Atlanta6,196
 33,828
 11,097
 6,196
 44,925
 51,121
 21,671
 29,450
 2005
              Camden Paces15,262
 102,521
 1,218
 15,262
 103,739
 119,001
 22,448
 96,553
 2015
              Camden Peachtree City6,536
 29,063
 8,323
 6,536
 37,386
 43,922
 17,992
 25,930
 2005
              Camden Shiloh4,181
 18,798
 6,220
 4,181
 25,018
 29,199
 12,697
 16,502
 2005
              Camden St. Clair7,526
 27,486
 8,316
 7,526
 35,802
 43,328
 18,251
 25,077
 2005
              Camden Stockbridge5,071
 22,693
 5,281
 5,071
 27,974
 33,045
 13,537
 19,508
 2005
              Camden Vantage11,787
 68,822
 7,354
 11,787
 76,176
 87,963
 17,762
 70,201
 2013
NORTH CAROLINA                 
       Charlotte                 
              Camden Ballantyne$4,503
 $30,250
 $9,801
 $4,503
 $40,051
 $44,554
 $20,131
 $24,423
 2005
              Camden Cotton Mills4,246
 19,147
 7,548
 4,246
 26,695
 30,941
 13,703
 17,238
 2005
              CoWork by Camden814
 3,422
 9
 814
 3,431
 4,245
 172
 4,073
 2019
              Camden Dilworth516
 16,633
 3,421
 516
 20,054
 20,570
 8,836
 11,734
 2006
              Camden Fairview1,283
 7,223
 4,639
 1,283
 11,862
 13,145
 6,692
 6,453
 2005
              Camden Foxcroft1,408
 7,919
 4,898
 1,408
 12,817
 14,225
 7,103
 7,122
 2005
              Camden Foxcroft II1,152
 6,499
 3,698
 1,152
 10,197
 11,349
 5,096
 6,253
 2005
              Camden Gallery7,930
 51,957
 637
 7,930
 52,594
 60,524
 8,449
 52,075
 2017
              Camden Grandview7,570
 33,859
 13,278
 7,570
 47,137
 54,707
 22,302
 32,405
 2005
              Camden Grandview II4,617
 17,852
 26
 4,617
 17,878
 22,495
 1,120
 21,375
 2019
              Camden Sedgebrook5,266
 29,211
 8,192
 5,266
 37,403
 42,669
 18,878
 23,791
 2005
              Camden South End6,625
 29,175
 14,961
 6,625
 44,136
 50,761
 19,757
 31,004
 2005
              Camden Stonecrest3,941
 22,021
 6,962
 3,941
 28,983
 32,924
 14,930
 17,994
 2005
              Camden Touchstone1,203
 6,772
 3,807
 1,203
 10,579
 11,782
 5,818
 5,964
 2005
       Raleigh                 
              Camden Carolinian14,765
 56,674
 39
 14,765
 56,713
 71,478
 267
 71,211
 2019
              Camden Crest4,412
 31,108
 7,473
 4,412
 38,581
 42,993
 17,807
 25,186
 2005
              Camden Governor's Village3,669
 20,508
 7,066
 3,669
 27,574
 31,243
 12,827
 18,416
 2005
              Camden Lake Pine5,746
 31,714
 14,563
 5,746
 46,277
 52,023
 22,328
 29,695
 2005
              Camden Manor Park2,535
 47,159
 11,213
 2,535
 58,372
 60,907
 24,147
 36,760
 2006
              Camden Overlook4,591
 25,563
 10,347
 4,591
 35,910
 40,501
 18,586
 21,915
 2005
              Camden Reunion Park3,302
 18,457
 11,358
 3,302
 29,815
 33,117
 14,502
 18,615
 2005
              Camden Westwood4,567
 25,519
 9,115
 4,567
 34,634
 39,201
 16,292
 22,909
 2005
TEXAS                 
       Austin                 
              Camden Cedar Hills2,684
 20,931
 3,503
 2,684
 24,434
 27,118
 9,295
 17,823
 2008
              Camden Gaines Ranch5,094
 37,100
 10,909
 5,094
 48,009
 53,103
 23,458
 29,645
 2005
              Camden Huntingdon2,289
 17,393
 10,791
 2,289
 28,184
 30,473
 20,459
 10,014
 1995
              Camden La Frontera3,250
 32,376
 543
 3,250
 32,919
 36,169
 7,610
 28,559
 2015
              Camden Lamar Heights3,988
 42,773
 531
 3,988
 43,304
 47,292
 9,938
 37,354
 2015
              Camden Rainey Street30,044
 85,477
 887
 30,044
 86,364
 116,408
 3,040
 113,368
 2019
              Camden Stoneleigh3,498
 31,285
 8,966
 3,498
 40,251
 43,749
 19,167
 24,582
 2006
       Dallas/Fort Worth                 
              Camden Addison$11,516
 $29,332
 $8,735
 $11,516
 $38,067
 $49,583
 $13,673
 $35,910
 2012
              Camden Belmont12,521
 61,522
 6,530
 12,521
 68,052
 80,573
 17,987
 62,586
 2012
              Camden Buckingham2,704
 21,251
 11,413
 2,704
 32,664
 35,368
 21,634
 13,734
 1997
              Camden Centreport1,613
 12,644
 7,459
 1,613
 20,103
 21,716
 12,961
 8,755
 1997
              Camden Cimarron2,231
 14,092
 8,406
 2,231
 22,498
 24,729
 16,936
 7,793
 1997
              Camden Farmers Market17,341
 74,193
 28,144
 17,341
 102,337
 119,678
 54,327
 65,351
 2001/2005
              Camden Henderson3,842
 15,256
 801
 3,842
 16,057
 19,899
 4,680
 15,219
 2012
              Camden Legacy Creek2,052
 12,896
 7,420
 2,052
 20,316
 22,368
 14,235
 8,133
 1997
              Camden Legacy Park2,560
 15,449
 8,588
 2,560
 24,037
 26,597
 16,591
 10,006
 1997
              Camden Valley Park3,096
 14,667
 15,989
 3,096
 30,656
 33,752
 28,700
 5,052
 1994
              Camden Victory Park13,445
 71,735
 391
 13,445
 72,126
 85,571
 12,393
 73,178
 2016
       Houston                 
              Camden City Centre4,976
 44,735
 8,861
 4,976
 53,596
 58,572
 20,203
 38,369
 2007
              Camden City Centre II5,101
 28,131
 576
 5,101
 28,707
 33,808
 8,299
 25,509
 2013
              Camden Greenway16,916
 43,933
 21,492
 16,916
 65,425
 82,341
 42,848
 39,493
 1999
              Camden Highland Village28,536
 111,802
 34
 28,536
 111,836
 140,372
 586
 139,786
 2019
              Camden Holly Springs11,108
 42,852
 12,811
 11,108
 55,663
 66,771
 19,048
 47,723
 2012
              Camden McGowen Station6,089
 85,038
 18
 6,089
 85,056
 91,145
 9,284
 81,861
 2018
              Camden Midtown4,583
 18,026
 11,861
 4,583
 29,887
 34,470
 19,581
 14,889
 1999
              Camden Oak Crest2,078
 20,941
 6,437
 2,078
 27,378
 29,456
 15,113
 14,343
 2003
              Camden Park4,922
 16,453
 6,443
 4,922
 22,896
 27,818
 8,015
 19,803
 2012
              Camden Plaza7,204
 31,044
 4,528
 7,204
 35,572
 42,776
 10,443
 32,333
 2007
              Camden Post Oak14,056
 92,515
 19,339
 14,056
 111,854
 125,910
 27,955
 97,955
 2013
              Camden Royal Oaks1,055
 20,046
 3,829
 1,055
 23,875
 24,930
 10,362
 14,568
 2006
              Camden Royal Oaks II587
 12,743
 28
 587
 12,771
 13,358
 3,791
 9,567
 2012
              Camden Stonebridge1,016
 7,137
 7,076
 1,016
 14,213
 15,229
 10,152
 5,077
 1993
              Camden Sugar Grove7,614
 27,594
 5,004
 7,614
 32,598
 40,212
 9,840
 30,372
 2012
              Camden Travis Street1,780
 29,104
 2,028
 1,780
 31,132
 32,912
 11,104
 21,808
 2010
              Camden Vanderbilt16,076
 44,918
 26,933
 16,076
 71,851
 87,927
 49,883
 38,044
 1994/1997
              Camden Whispering Oaks1,188
 26,242
 2,016
 1,188
 28,258
 29,446
 11,332
 18,114
 2008
                  
Total current communities:$1,199,384
 $6,275,187
 $1,122,505
 $1,199,384
 $7,397,692
 $8,597,076
 $2,685,956
 $5,911,120
  
                  
Communities under construction:                 
       Name / location                 
              Camden Atlantic
Plantation, FL
  $19,259
     $19,259
 $19,259
   $19,259
 N/A
              Camden Buckhead
Atlanta, GA
  55,166
     55,166
 55,166
   55,166
 N/A
              Camden Downtown I
Houston, TX
  123,465
     123,465
 123,465
 48
 123,417
 N/A
              Camden Hillcrest
San Diego, CA
  42,669
     42,669
 42,669
   42,669
 N/A
              Camden Lake Eola
Orlando, FL
  75,000
     75,000
 75,000
   75,000
 N/A
              Camden North End II
Phoenix, AZ
  31,350
     31,350
 31,350
   31,350
 N/A
              Camden RiNo
Denver, CO
  66,530
     66,530
 66,530
 $21 66,509
 N/A
                  
Total communities under construction:$
 $413,439
 $
 $
 $413,439
 $413,439
 $69
 $413,370
  
                  
Development pipeline communities:                 
       Name/location                 
              Camden Arts District
Los Angeles, CA
  $26,888
     $26,888
 $26,888
   $26,888
 N/A
              Camden Downtown II
Houston, TX
  11,406
     11,406
 11,406
   11,406
 N/A
              Camden Hayden II
Phoenix, AZ
  22,004
     22,004
 22,004
   22,004
 N/A
              Camden Highland Village II
Houston, TX
  8,025
     8,025
 8,025
   8,025
 N/A
              Camden NoDa
Charlotte, NC
  14,748
     14,748
 14,748
   14,748
 N/A
              Camden Paces III
Atlanta, GA
  15,783
     15,783
 15,783
   15,783
 N/A
                  
Total development pipeline communities:$
 $98,854
 $
 $
 $98,854
 $98,854
 $
 $98,854
  
                  
Corporate


 6,424
 

 
 6,424
 6,424
 

 6,424
 N/A
                  
 $
 $6,424
 $
 $
 $6,424
 $6,424
 $
 $6,424
  
                  
TOTAL$1,199,384
 $6,793,904
 $1,122,505
 $1,199,384
 $7,916,409
 $9,115,793
 $2,686,025
 $6,429,768
  

(1)All communities were unencumbered at December 31, 2019.

S-1


Camden Property Trust
Real Estate and Accumulated Depreciation
As of December 31, 2019
(in thousands)
Schedule III
 
The changes in total real estate assets as adjusted for discontinued operations for the years ended December 31:
 
 2019 2018 2017
Balance, beginning of period$8,328,475
 $7,667,743
 $7,376,690
Additions during period:  
 
Acquisition of operating properties422,309
 286,901
 56,985
Development and repositions341,236
 300,294
 224,202
Improvements75,360
 84,841
 71,889
Deductions during period:     
Cost of real estate sold – other(51,587) (11,304) (62,023)
Balance, end of period$9,115,793
 $8,328,475
 $7,667,743
 
The changes in accumulated depreciation for the years ended December 31:
 
 2019
2018 2017
Balance, beginning of period$2,403,149
 $2,118,839
 $1,890,656
Depreciation of real estate assets317,026
 284,310
 255,924
Dispositions(34,150) 
 (27,741)
Balance, end of period$2,686,025
 $2,403,149
 $2,118,839
The aggregate cost for federal income tax purposes at December 31, 2019 was $8.2 billion.

S-2


Camden Property Trust
Mortgage Loans on Real Estate
As of December 31, 2019
Schedule IV
           
($ in thousands)

Description
 Interest Rate Final Maturity Date Periodic payment terms 
Face amount of
mortgages
 
Carry amount of
mortgages (a)
Parking Garage
     Developer advances
          Houston, TX
 (b) 
October 1, 2025
 (c) $7,868
 $7,868


(a)The aggregate cost at December 31, 2019 for federal income tax purposes was approximately $7,868.
(b)This loan currently bears interest at 7% on any unpaid principal balance.
(c)
Payments will consist of annual interest and principal payments from October 1, 2019 to October 1, 2025.

Changes in mortgage loans for the years ended December 31 are summarized below:

 2019 2018 2017
Balance, beginning of period$9,314
 $18,790
 $17,224
Additions:     
Advances under real estate loans
 
 1,566
Deductions:     
Collections of principal and loan payoff(1,446) (9,476) 
Balance, end of period$7,868
 $9,314
 $18,790


S-3