[Glossary](index=4&type=section&id=Glossary) Defines key financial and operational terms essential for understanding the company's report - The report includes a glossary defining abbreviations and key terms such as Annualized Rent, Funds From Operations (FFO), Leased Rate, Net Operating Income (NOI), Occupancy Rate, Recurring Capital Expenditures, Rentable Square Feet, Rental Rate, Same Properties, Short-Term Leases, and Total Portfolio, which are crucial for understanding the company's financial and operational metrics[8](index=8&type=chunk)[10](index=10&type=chunk)[12](index=12&type=chunk) [Forward Looking Statements](index=7&type=section&id=Forward%20Looking%20Statements) Highlights inherent risks and uncertainties that may impact future financial performance and operational outcomes - This report contains forward-looking statements subject to various risks and uncertainties, including adverse developments from the COVID-19 pandemic, economic or real estate market conditions in Southern California and Honolulu, competition, decreasing rental rates, tenant defaults, increasing interest rates, and difficulties in raising capital[14](index=14&type=chunk) - Other significant risks include inability to liquidate real estate investments quickly, adverse changes to rent laws, environmental uncertainties, natural disasters, fire and property damage, insufficient insurance, difficulties in entering new markets, and challenges in property acquisitions and development[14](index=14&type=chunk) [PART I. FINANCIAL INFORMATION](index=8&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) Presents the company's unaudited financial statements and management's discussion and analysis for the period [Item 1. Financial Statements (unaudited)](index=8&type=section&id=Item%201.%20Financial%20Statements%20(unaudited)) The financial statements for the quarter ended March 31, 2022, show an increase in total assets and equity compared to December 31, 2021, driven by higher cash and cash equivalents and a significant gain in accumulated other comprehensive income [Consolidated Balance Sheets](index=8&type=section&id=Consolidated%20Balance%20Sheets) Details the company's financial position, showing changes in assets, liabilities, and equity from year-end 2021 to Q1 2022 | Metric | March 31, 2022 (in thousands) | December 31, 2021 (in thousands) | |:---------------------------------------------|:------------------------------|:---------------------------------| | Total Assets | $9,440,314 | $9,354,032 | | Total Liabilities | $5,314,617 | $5,367,479 | | Total Equity | $4,125,697 | $3,986,553 | | Douglas Emmett, Inc. stockholders' equity | $2,517,947 | $2,416,069 | | Noncontrolling interests | $1,607,750 | $1,570,484 | | Cash and cash equivalents | $337,274 | $335,905 | | Interest rate contract assets | $125,189 | $15,473 | | Interest rate contract liabilities | $6,667 | $69,930 | - Total assets increased by **$86.3 million (0.9%)** from December 31, 2021, to March 31, 2022, primarily driven by a significant increase in interest rate contract assets and other assets[19](index=19&type=chunk) - Total liabilities decreased by **$52.8 million (1.0%)**, mainly due to a substantial decrease in interest rate contract liabilities[19](index=19&type=chunk) - Total equity increased by **$139.1 million (3.5%)**, with Douglas Emmett, Inc. stockholders' equity rising by **$101.9 million (4.2%)** and noncontrolling interests increasing by **$37.3 million (2.4%)**[19](index=19&type=chunk) [Consolidated Statements of Operations](index=9&type=section&id=Consolidated%20Statements%20of%20Operations) Presents the company's revenues, expenses, and net income for the three months ended March 31, 2022 and 2021 | Metric | Three Months Ended March 31, 2022 (in thousands) | Three Months Ended March 31, 2021 (in thousands) | YoY Change (in thousands) | YoY Change (%) | |:-------------------------------------------|:-------------------------------------------------|:-------------------------------------------------|:--------------------------|:---------------| | Total revenues | $238,882 | $216,295 | $22,587 | 10.4% | | Total operating expenses | $178,152 | $173,857 | $4,295 | 2.5% | | Net income | $26,259 | $7,588 | $18,671 | 246.1% | | Net income attributable to common stockholders | $25,514 | $11,601 | $13,913 | 120.0% | | Net income per common share – basic and diluted | $0.14 | $0.06 | $0.08 | 133.3% | - Total revenues increased by **10.4%** year-over-year, driven by a **7.3%** increase in office rental revenues and tenant recoveries and a **20.5%** increase in multifamily rental revenues[21](index=21&type=chunk) - Net income attributable to common stockholders surged by **120.0%** to **$25.5 million**, and diluted EPS increased by **133.3%** to **$0.14**, reflecting improved operational performance and lower write-offs[21](index=21&type=chunk) [Consolidated Statements of Comprehensive Income](index=10&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income) Reports net income and other comprehensive income components, primarily driven by cash flow hedge adjustments | Metric | Three Months Ended March 31, 2022 (in thousands) | Three Months Ended March 31, 2021 (in thousands) | YoY Change (in thousands) | YoY Change (%) | |:------------------------------------------------|:-------------------------------------------------|:-------------------------------------------------|:--------------------------|:---------------| | Net income | $26,259 | $7,588 | $18,671 | 246.1% | | Other comprehensive income: cash flow hedges | $174,434 | $76,469 | $97,965 | 128.1% | | Comprehensive income | $200,693 | $84,057 | $116,636 | 138.8% | | Comprehensive income attributable to common stockholders | $147,317 | $62,304 | $85,013 | 136.4% | - Comprehensive income attributable to common stockholders increased by **136.4%** year-over-year, primarily driven by a significant gain from cash flow hedges[23](index=23&type=chunk) [Consolidated Statements of Equity](index=11&type=section&id=Consolidated%20Statements%20of%20Equity) Outlines changes in total equity, including net income, cash flow hedge adjustments, and dividend payments | Metric | Three Months Ended March 31, 2022 (in thousands) | Three Months Ended March 31, 2021 (in thousands) | |:---------------------------------------------|:-------------------------------------------------|:-------------------------------------------------| | Beginning balance (Total Equity) | $3,986,553 | $3,996,019 | | Net income | $26,259 | $7,588 | | Cash flow hedge adjustments | $174,434 | $76,469 | | Dividends | $(49,215) | $(49,131) | | Ending balance (Total Equity) | $4,125,697 | $4,020,525 | | Dividends declared per common share | $0.28 | $0.28 | - Total equity increased by **$139.1 million** during the three months ended March 31, 2022, primarily due to net income and substantial cash flow hedge adjustments, despite dividend payments[25](index=25&type=chunk) - Accumulated other comprehensive income (AOCI) shifted from a deficit of **$(38.8) million** at the beginning of the period to a positive **$83.0 million**, largely due to cash flow hedge adjustments of **$121.8 million** attributable to common stockholders[25](index=25&type=chunk) [Consolidated Statements of Cash Flows](index=13&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Summarizes cash inflows and outflows from operating, investing, and financing activities for the period | Activity | Three Months Ended March 31, 2022 (in thousands) | Three Months Ended March 31, 2021 (in thousands) | YoY Change (in thousands) | YoY Change (%) | |:------------------------------------------|:-------------------------------------------------|:-------------------------------------------------|:--------------------------|:---------------| | Net cash provided by operating activities | $139,470 | $125,044 | $14,426 | 11.5% | | Net cash used in investing activities | $(72,944) | $(79,317) | $6,373 | 8.0% | | Net cash used in financing activities | $(65,157) | $(33,838) | $(31,319) | (92.6)% | | Increase in cash and cash equivalents | $1,369 | $11,889 | $(10,520) | (88.5)% | | Ending cash and cash equivalents | $337,375 | $184,406 | $152,969 | 83.0% | - Net cash provided by operating activities increased by **11.5%** year-over-year, primarily due to higher revenues from office and multifamily portfolios, better collections, and increased parking income[28](index=28&type=chunk)[173](index=173&type=chunk) - Net cash used in investing activities decreased by **8.0%**, mainly due to a **$34.5 million** decrease in capital expenditures for developments, partially offset by a **$25.0 million** deposit for a property acquisition and a **$4.2 million** increase in capital expenditures for real estate improvements[28](index=28&type=chunk)[173](index=173&type=chunk) - Net cash used in financing activities significantly increased by **92.6%**, primarily due to a **$30.0 million** decrease in net borrowings[28](index=28&type=chunk)[173](index=173&type=chunk) [Notes to Consolidated Financial Statements](index=16&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Provides detailed explanations and additional information supporting the consolidated financial statements [1. Overview](index=16&type=section&id=1.%20Overview) Describes the company's business as a REIT focused on office and multifamily properties in specific geographic markets - Douglas Emmett, Inc. is a self-administered and self-managed REIT, focusing on high-quality office and multifamily properties in Los Angeles County, California, and Honolulu, Hawaii[35](index=35&type=chunk) | Portfolio Component | Consolidated Portfolio | Total Portfolio | |:--------------------|:-----------------------|:----------------| | Office properties | 69 | 71 | | Office square feet | 17.8 million | 18.2 million | | Multifamily properties | 12 | 12 | | Multifamily units | 4,415 | 4,415 | - The company consolidates entities where it is the primary beneficiary, including its Operating Partnership and three joint ventures, with consolidated debt (excluding JVs) of **$3.41 billion** as of March 31, 2022[39](index=39&type=chunk) [2. Summary of Significant Accounting Policies](index=17&type=section&id=2.%20Summary%20of%20Significant%20Accounting%20Policies) Details the accounting principles and methods used in preparing the financial statements, with no material changes from the prior year - No changes were made to significant accounting policies disclosed in the 2021 Annual Report on Form 10-K[44](index=44&type=chunk) - Revenue recognition for rental revenues and tenant recoveries follows Topic 842 'Leases', with collectibility assessments impacting straight-line versus cash basis income recognition[46](index=46&type=chunk)[47](index=47&type=chunk) - Charges for uncollectible tenant receivables and deferred rent receivables, primarily due to COVID-19, reduced office revenues by **$0.1 million** for the three months ended March 31, 2022, a significant decrease from **$1.8 million** in the prior year[47](index=47&type=chunk) [3. Investment in Real Estate](index=18&type=section&id=3.%20Investment%20in%20Real%20Estate) Presents the composition and changes in the company's real estate investments, including land, buildings, and properties under development | Component | March 31, 2022 (in thousands) | December 31, 2021 (in thousands) | |:--------------------------------|:------------------------------|:---------------------------------| | Land | $1,150,821 | $1,150,821 | | Buildings and improvements | $9,359,788 | $9,344,087 | | Tenant improvements and lease intangibles | $936,698 | $935,639 | | Property under development | $394,386 | $388,530 | | Investment in real estate, gross | $11,841,693 | $11,819,077 | - During the three months ended March 31, 2022, **$8.6 million** of Property under development balances were transferred to Building and improvements for real estate placed into service[52](index=52&type=chunk) - No properties were purchased or sold during the three months ended March 31, 2022, though a residential property was acquired in April 2022 (see Note 17)[53](index=53&type=chunk) [4. Ground Lease](index=20&type=section&id=4.%20Ground%20Lease) Details the company's ground lease obligations, including annual payments and future minimum lease commitments - The company pays **$733 thousand** per year for a ground lease in Honolulu, Hawaii, expiring December 31, 2086, with rent resetting to market rates after February 28, 2029[56](index=56&type=chunk) | Metric | Amount (in thousands) | |:-----------------------------|:----------------------| | Ground lease right-of-use asset carrying value | $7,500 | | Ground lease liability | $10,900 | | Ground rent expense (Q1 2022) | $182 | | Twelve months ending March 31: | Future Minimum Lease Payments (in thousands) | |:-------------------------------|:---------------------------------------------| | 2023 | $733 | | 2024 | $733 | | 2025 | $733 | | 2026 | $733 | | 2027 | $733 | | Thereafter | $43,796 | | Total | $47,461 | [5. Acquired Lease Intangibles](index=21&type=section&id=5.%20Acquired%20Lease%20Intangibles) Reports the net carrying values and accretion of acquired lease intangible assets and liabilities | Metric | March 31, 2022 (in thousands) | December 31, 2021 (in thousands) | |:---------------------------------------------|:------------------------------|:---------------------------------| | Acquired lease intangible assets, net | $3,969 | $4,168 | | Acquired lease intangible liabilities, net | $22,714 | $24,710 | | Metric | Three Months Ended March 31, 2022 (in thousands) | Three Months Ended March 31, 2021 (in thousands) | |:---------------------------------------------|:-------------------------------------------------|:-------------------------------------------------| | Net accretion of above- and below-market tenant lease assets and liabilities | $1,801 | $3,118 | | Total net accretion/amortization | $1,797 | $3,114 | - The net accretion of acquired lease intangibles decreased from **$3.114 million** in Q1 2021 to **$1.797 million** in Q1 2022, indicating a lower positive impact on rental revenues[61](index=61&type=chunk) [6. Investment in Unconsolidated Fund](index=22&type=section&id=6.%20Investment%20in%20Unconsolidated%20Fund) Provides financial details and distributions from the company's equity interest in an unconsolidated fund - The company manages and holds a **33.5%** equity interest in Partnership X, an unconsolidated fund owning two office properties totaling **0.4 million square feet**[64](index=64&type=chunk) | Metric | Three Months Ended March 31, 2022 (in thousands) | Three Months Ended March 31, 2021 (in thousands) | |:-------------------------------------|:-------------------------------------------------|:-------------------------------------------------| | Operating distributions received | $244 | $164 | | Capital distributions received | $531 | $194 | | Total distributions received | $775 | $358 | | Partnership X Financials (100%) | March 31, 2022 (in thousands) | December 31, 2021 (in thousands) | |:--------------------------------|:------------------------------|:---------------------------------| | Total assets | $144,662 | $139,171 | | Total liabilities | $118,512 | $117,668 | | Total equity | $26,150 | $21,503 | | Total revenues (Q1) | $4,397 | $4,002 | | Net income (Q1) | $622 | $396 | [7. Other Assets](index=22&type=section&id=7.%20Other%20Assets) Itemizes other assets, including restricted cash, prepaid expenses, and deposits for property acquisitions | Component | March 31, 2022 (in thousands) | December 31, 2021 (in thousands) | |:--------------------------------|:------------------------------|:---------------------------------| | Restricted cash | $101 | $101 | | Prepaid expenses | $13,476 | $15,936 | | Indefinite-lived intangibles | $1,988 | $1,988 | | Deposits in escrow | $25,000 | $0 | | Furniture, fixtures and equipment, net | $2,425 | $2,499 | | Other | $5,469 | $5,197 | | Total other assets | $48,459 | $25,721 | - Total other assets increased significantly from **$25.7 million** to **$48.5 million**, primarily due to a **$25.0 million** deposit in escrow for a property acquisition completed in April 2022[67](index=67&type=chunk) [8. Secured Notes Payable and Revolving Credit Facility, Net](index=24&type=section&id=8.%20Secured%20Notes%20Payable%20and%20Revolving%20Credit%20Facility,%20Net) Details the company's consolidated debt, including principal balances, weighted average interest rates, and future principal payments | Debt Type | March 31, 2022 (in thousands) | December 31, 2021 (in thousands) | |:----------------------------------------|:------------------------------|:---------------------------------| | Total Wholly Owned Subsidiary Debt | $3,411,523 | $3,411,725 | | Total Consolidated JVs Debt | $1,635,000 | $1,635,000 | | Total Consolidated Debt | $5,046,523 | $5,046,725 | | Total Consolidated Debt, net | $5,013,876 | $5,012,076 | | Debt Statistic (as of March 31, 2022) | Value | |:--------------------------------------|:------------| | Principal balance | **$5.05 billion** | | Weighted average remaining life | **5.2 years** | | Weighted average remaining fixed interest period | **2.8 years** | | Weighted average annual interest rate | **2.89%** | | Twelve months ending March 31: | Future Principal Payments (in thousands) | |:-------------------------------|:-----------------------------------------| | 2023 | $833 | | 2024 | $871 | | 2025 | $735,912 | | 2026 | $103,354 | | 2027 | $1,415,999 | | Thereafter | $2,789,554 | | Total | $5,046,523 | [9. Interest Payable, Accounts Payable and Deferred Revenue](index=27&type=section&id=9.%20Interest%20Payable,%20Accounts%20Payable%20and%20Deferred%20Revenue) Presents the balances of interest payable, accounts payable, and deferred revenue as of the reporting dates | Component | March 31, 2022 (in thousands) | December 31, 2021 (in thousands) | |:--------------------------------------------|:------------------------------|:---------------------------------| | Interest payable | $12,467 | $12,254 | | Accounts payable and accrued liabilities | $98,740 | $83,150 | | Deferred revenue | $43,725 | $50,056 | | Total interest payable, accounts payable and deferred revenue | $154,932 | $145,460 | - Total interest payable, accounts payable, and deferred revenue increased by **$9.5 million (6.5%)** from December 31, 2021, to March 31, 2022, primarily due to an increase in accounts payable and accrued liabilities[75](index=75&type=chunk) [10. Derivative Contracts](index=27&type=section&id=10.%20Derivative%20Contracts) Describes the company's use of interest rate swaps to manage risk and their fair value impact on financial statements - The company uses interest rate swap contracts to manage risk on floating-rate debt, effectively converting it to a fixed-rate basis, and does not speculate in derivatives[77](index=77&type=chunk) | Derivative Type | Number of Swaps | Notional Amount (in thousands) | |:------------------------------------|:----------------|:-------------------------------| | Consolidated derivatives | 35 | $5,017,400 | | Unconsolidated Fund's derivatives | 2 | $115,000 | | Metric | March 31, 2022 (in thousands) | December 31, 2021 (in thousands) | |:---------------------------------------------|:------------------------------|:---------------------------------| | Fair value - consolidated derivatives (assets) | $125,189 | $15,473 | | Fair value - consolidated derivatives (liabilities) | $6,667 | $69,930 | | Fair value - unconsolidated Fund's derivatives (assets) | $7,564 | $1,963 | - Consolidated derivative assets significantly increased from **$15.5 million** to **$125.2 million**, while liabilities decreased from **$69.9 million** to **$6.7 million**, indicating a favorable shift in fair value[104](index=104&type=chunk) | Impact on AOCI and Operations (Q1 2022) | Amount (in thousands) | |:----------------------------------------|:----------------------| | Consolidated derivatives: Gains recorded in AOCI before reclassifications | $154,944 | | Consolidated derivatives: Losses reclassified from AOCI to Interest Expense | $17,649 | | Unconsolidated Fund's derivative (our share): Gains recorded in AOCI before reclassifications | $1,774 | | Unconsolidated Fund's derivative (our share): Losses reclassified from AOCI to Income from unconsolidated Fund | $67 | [11. Equity](index=31&type=section&id=11.%20Equity) Details changes in equity, including common stock transactions, noncontrolling interests, and stock-based compensation - During Q1 2022, the company acquired **243 thousand OP Units** in exchange for common stock and **9 thousand OP Units** for **$313 thousand** in cash[86](index=86&type=chunk) - Noncontrolling interests in the Operating Partnership owned **30.8 million OP Units** and fully-vested LTIP Units, representing approximately **15%** of total outstanding interests as of March 31, 2022[88](index=88&type=chunk) | Metric | Three Months Ended March 31, 2022 (in thousands) | Three Months Ended March 31, 2021 (in thousands) | |:---------------------------------------------|:-------------------------------------------------|:-------------------------------------------------| | Net income attributable to common stockholders | $25,514 | $11,601 | | Net transfers from noncontrolling interests | $3,776 | $61 | | Change from net income and transfers | $29,290 | $11,662 | - Stock-based compensation expense, net, was **$2.581 million** for Q1 2022, slightly down from **$2.694 million** in Q1 2021[94](index=94&type=chunk) [12. EPS](index=33&type=section&id=12.%20EPS) Reports basic and diluted earnings per share, reflecting net income attributable to common stockholders | Metric | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | |:---------------------------------------------|:----------------------------------|:----------------------------------| | Net income attributable to common stockholders - basic and diluted | $25,288 (in thousands) | $11,382 (in thousands) | | Weighted average shares of common stock outstanding - basic and diluted | 175,656 (in thousands) | 175,464 (in thousands) | | Net income per common share - basic and diluted | $0.14 | $0.06 | - Basic and diluted EPS increased to **$0.14** for Q1 2022, up from **$0.06** in Q1 2021, reflecting a significant improvement in net income attributable to common stockholders[96](index=96&type=chunk) [13. Fair Value of Financial Instruments](index=34&type=section&id=13.%20Fair%20Value%20of%20Financial%20Instruments) Provides fair value estimates for financial instruments, including secured notes payable and derivative contracts - The company uses Level 2 inputs (observable market interest rates) for fair value estimates of secured notes payable and ground lease liability, and for derivative instruments[101](index=101&type=chunk)[102](index=102&type=chunk)[104](index=104&type=chunk) | Financial Instrument (in thousands) | March 31, 2022 Fair Value | March 31, 2022 Carrying Value | |:------------------------------------|:--------------------------|:------------------------------| | Secured notes payable | $5,017,170 | $5,050,416 | | Ground lease liability | $8,086 | $10,856 | - Short-term financial instruments like cash, tenant receivables, and payables approximate fair value due to their short-term nature[100](index=100&type=chunk) [14. Segment Reporting](index=36&type=section&id=14.%20Segment%20Reporting) Presents financial performance by operating segment, distinguishing between office and multifamily real estate - The company operates in two segments: office real estate and multifamily real estate, with segment profit calculated before general and administrative expenses, depreciation, amortization, and interest expense[106](index=106&type=chunk) | Segment Activity (in thousands) | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | |:--------------------------------|:----------------------------------|:----------------------------------| | Office Segment Profit | $135,766 | $124,465 | | Multifamily Segment Profit | $25,569 | $20,341 | | Total Profit from All Segments | $161,335 | $144,806 | - Total profit from all segments increased by **$16.5 million (11.4%)** year-over-year, with office segment profit up **9.1%** and multifamily segment profit up **25.7%**[106](index=106&type=chunk) [15. Future Minimum Lease Rental Receipts](index=37&type=section&id=15.%20Future%20Minimum%20Lease%20Rental%20Receipts) Outlines the total future minimum base rentals expected from non-cancelable office tenant and ground leases | Twelve months ending March 31: | Future Minimum Base Rentals (in thousands) | |:-------------------------------|:-------------------------------------------| | 2023 | $628,283 | | 2024 | $530,024 | | 2025 | $428,543 | | 2026 | $332,702 | | 2027 | $246,890 | | Thereafter | $673,309 | | Total | $2,839,751 | - The total future minimum base rentals from non-cancelable office tenant and ground leases for consolidated properties amount to **$2.84 billion** as of March 31, 2022[108](index=108&type=chunk) [16. Commitments, Contingencies & Guarantees](index=37&type=section&id=16.%20Commitments,%20Contingencies%20%26%20Guarantees) Discusses legal proceedings, concentration of risk, contractual commitments, and guarantees - The company is party to various lawsuits in the ordinary course of business but does not expect any to have a materially adverse effect[109](index=109&type=chunk) - Concentration of risk exists in tenant receivables (mitigated by targeting affluent tenants, credit evaluations, and security deposits) and geographic risk due to all properties being in Los Angeles County and Honolulu[110](index=110&type=chunk)[111](index=111&type=chunk) - As of March 31, 2022, remaining contractual commitments for development projects totaled approximately **$58.9 million**, and for repositionings, capital expenditure projects, and tenant improvements, approximately **$30.2 million**[117](index=117&type=chunk)[118](index=118&type=chunk) - The company has guaranteed certain non-recourse carve-outs and interest rate swaps for Partnership X's **$115.0 million** floating-rate term loan, with Partnership X agreeing to indemnify the company for any payments[119](index=119&type=chunk)[120](index=120&type=chunk) [17. Subsequent Events](index=40&type=section&id=17.%20Subsequent%20Events) Reports significant events occurring after the balance sheet date, including a major property acquisition - On April 26, 2022, the company acquired a luxury multifamily apartment building with **120 units** at 1221 Ocean Avenue in Santa Monica for **$330.0 million** through a new joint venture (**55%** capital interest)[123](index=123&type=chunk) - The acquisition was partly financed with a **$175.0 million** secured, non-recourse interest-only term loan, with the interest rate swap-fixed at **3.90%** until May 1, 2026[123](index=123&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=41&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) The company's Q1 2022 results show favorable comparisons to Q1 2021, driven by improved rent collections, lower write-offs, and higher tenant recoveries and parking income, despite ongoing COVID-19 impacts [Business Description](index=41&type=section&id=Business%20Description) Describes the company's core business as a REIT focused on high-quality office and multifamily properties in key markets - Douglas Emmett, Inc. is a fully integrated REIT specializing in high-quality office and multifamily properties in Los Angeles County and Honolulu, focusing on areas with significant supply constraints and lifestyle amenities[126](index=126&type=chunk) | Portfolio Type | Properties | Rentable Square Feet (thousands) / Units | Leased Rate | Occupancy Rate | |:---------------|:-----------|:-----------------------------------------|:------------|:---------------| | Office | 71 | 18,160 | 87.7% | 84.6% | | Multifamily | 12 | 4,415 | 99.7% | 98.2% | [Impacts of the COVID-19 Pandemic on our Business](index=43&type=section&id=Impacts%20of%20the%20COVID-19%20Pandemic%20on%20our%20Business) Assesses the ongoing effects of the COVID-19 pandemic on rent collections, leasing, and overall business operations - COVID-19 pandemic relief ordinances in California and Hawaii continue to negatively impact rent collections, though conditions are improving[131](index=131&type=chunk) - Charges for uncollectible tenant receivables decreased significantly from **$1.8 million** in Q1 2021 to **$0.1 million** in Q1 2022, indicating better collections[132](index=132&type=chunk) - Future impacts on leasing, rent collections, and revenue remain uncertain, depending on pandemic duration, new tenant protections, tenant business conditions, building attendance, and long-term occupancy trends[133](index=133&type=chunk) [Acquisitions, Financings, Developments and Repositionings](index=43&type=section&id=Acquisitions,%20Financings,%20Developments%20and%20Repositionings) Details recent strategic activities including debt refinancing, property developments, and repositioning projects - In Q1 2022, interest rate swaps for a **$300.0 million** term loan were replaced, reducing the swap-fixed interest rate from **3.42%** to **2.66%**[136](index=136&type=chunk) - The 34-story 'The Landmark Los Angeles' residential high-rise with **376 apartments** in Brentwood, California, was completed and is expected to be placed into service in Q2 2022[137](index=137&type=chunk) - The 'The Residences at Bishop Place' project in Honolulu, converting an office tower into **493 rental apartments**, has delivered **52%** and leased **51%** of planned units, with phased conversion continuing through 2025[139](index=139&type=chunk) [Rental Rate Trends - Total Portfolio](index=44&type=section&id=Rental%20Rate%20Trends%20-%20Total%20Portfolio) Analyzes changes in office and multifamily rental rates, including straight-line and cash rent comparisons | Office Rental Rate (per leased square foot) | Three Months Ended March 31, 2022 | Year Ended December 31, 2021 | |:--------------------------------------------|:----------------------------------|:-----------------------------| | Average straight-line rental rate | $48.83 | $44.99 | | Annualized lease transaction costs | $6.16 | $4.77 | | Office Rent Roll (per leased square foot) | Expiring Rate | New/Renewal Rate | Percentage Change | |:------------------------------------------|:--------------|:-----------------|:------------------| | Cash Rent | $49.19 | $47.35 | (3.7)% | | Straight-line Rent | $44.62 | $48.83 | 9.4% | - Multifamily rental rates for new tenants averaged **$29,612** annually in Q1 2022, slightly down from **$29,837** in 2021, but the rent on leases subject to change (new and existing tenants) was **7.3%** higher on average than prior rent[146](index=146&type=chunk)[147](index=147&type=chunk) [Occupancy Rates - Total Portfolio](index=46&type=section&id=Occupancy%20Rates%20-%20Total%20Portfolio) Presents current and average occupancy rates for the office and multifamily portfolios, highlighting trends | Occupancy Rates as of: | March 31, 2022 | December 31, 2021 | |:-----------------------|:---------------|:------------------| | Office portfolio | 84.6% | 84.9% | | Multifamily portfolio | 98.2% | 98.0% | | Average Occupancy Rates: | Three Months Ended March 31, 2022 | Year Ended December 31, 2021 | |:-------------------------|:----------------------------------|:-----------------------------| | Office portfolio | 84.7% | 85.7% | | Multifamily portfolio | 98.1% | 96.8% | - Office occupancy rates continued to be adversely impacted by COVID-19, while multifamily occupancy rates improved in Q1 2022 compared to 2020 and 2021[149](index=149&type=chunk) [Comparison of three months ended March 31, 2022 to three months ended March 31, 2021](index=48&type=section&id=Comparison%20of%20three%20months%20ended%20March%2031,%202022%20to%20three%20months%20ended%20March%2031,%202021) Provides a detailed year-over-year comparison of key revenue and expense items, explaining significant variances | Metric (in thousands) | 2022 | 2021 | Change | % Change | |:--------------------------------------|:----------|:----------|:----------|:---------| | Office rental revenue and tenant recoveries | $180,427 | $168,179 | $12,248 | 7.3% | | Office parking and other income | $22,713 | $18,464 | $4,249 | 23.0% | | Multifamily revenue | $35,742 | $29,652 | $6,090 | 20.5% | | Office rental expenses | $67,374 | $62,178 | $(5,196) | (8.4)% | | Multifamily rental expenses | $10,173 | $9,311 | $(862) | (9.3)% | | General and administrative expenses | $11,240 | $9,571 | $(1,669) | (17.4)% | | Depreciation and amortization | $89,365 | $92,797 | $3,432 | 3.7% | | Income from unconsolidated Fund | $247 | $167 | $80 | 47.9% | | Interest expense | $(34,902) | $(35,205) | $303 | 0.9% | - Office rental revenue and tenant recoveries increased by **7.3%** due to better collections, lower write-offs, and higher tenant recoveries, partly offset by decreased occupancy[153](index=153&type=chunk) - Multifamily revenue increased by **20.5%** due to higher occupancy, rental rates, better collections, new units at Bishop Place, and higher insurance recoveries for fire damage[153](index=153&type=chunk) - General and administrative expenses increased by **17.4%** primarily due to higher personnel and advocacy expenses[153](index=153&type=chunk) [Non-GAAP Supplemental Financial Measure: FFO](index=50&type=section&id=Non-GAAP%20Supplemental%20Financial%20Measure:%20FFO) Reconciles net income to Funds From Operations (FFO), a key non-GAAP metric for evaluating REIT performance - FFO is a non-GAAP measure used by investors to evaluate REIT performance, excluding real estate depreciation, amortization, and gains/losses on sales, but has limitations as it doesn't capture changes in property value or capital expenditures[156](index=156&type=chunk) | Metric (in thousands) | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | |:----------------------------------------------|:----------------------------------|:----------------------------------| | Net income attributable to common stockholders | $25,514 | $11,601 | | Depreciation and amortization of real estate assets | $89,365 | $92,797 | | FFO | $103,763 | $89,937 | - FFO increased by **$13.8 million (15.4%)** to **$103.8 million** in Q1 2022, primarily due to increased revenues from both office and multifamily portfolios, driven by better collections, higher tenant recoveries, and improved occupancy[157](index=157&type=chunk) [Non-GAAP Supplemental Financial Measure: Same Property NOI](index=51&type=section&id=Non-GAAP%20Supplemental%20Financial%20Measure:%20Same%20Property%20NOI) Presents Same Property Net Operating Income (NOI) to assess the operational performance of comparable properties - Same Property NOI is a non-GAAP measure used to compare operational performance between periods by excluding the impact of investing transactions, but it has limitations as it excludes depreciation, amortization, and capital expenditures[161](index=161&type=chunk) | Metric (in thousands) | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | Change | % Change | |:----------------------|:----------------------------------|:----------------------------------|:----------|:---------| | Office NOI | $133,842 | $123,071 | $10,771 | 8.8% | | Multifamily NOI | $18,998 | $17,183 | $1,815 | 10.6% | | Total NOI | $152,840 | $140,254 | $12,586 | 9.0% | - Total Same Property NOI increased by **$12.6 million (9.0%)** in Q1 2022, with office NOI up **8.8%** and multifamily NOI up **10.6%**, primarily due to better collections, lower write-offs, and higher tenant recoveries and parking income[162](index=162&type=chunk)[163](index=163&type=chunk) [Liquidity and Capital Resources](index=52&type=section&id=Liquidity%20and%20Capital%20Resources) Discusses the company's ability to meet short-term and long-term financial obligations and fund strategic initiatives - Short-term liquidity needs are met through cash on hand (**$337.3 million** as of March 31, 2022), cash from operations (**$139.5 million** in Q1 2022), and a **$400.0 million** revolving credit facility with no outstanding balance[166](index=166&type=chunk) - Long-term liquidity for acquisitions, development, and debt refinancings will be met through long-term secured non-recourse debt, equity issuances (including an ATM program for up to **$400.0 million**), property dispositions, and JV transactions[167](index=167&type=chunk) - Approximately **46%** of the total office portfolio was unencumbered as of March 31, 2022, and interest rate swaps are generally used to mitigate floating interest rate risk[168](index=168&type=chunk) [Cash Flows](index=53&type=section&id=Cash%20Flows) Analyzes the sources and uses of cash from operating, investing, and financing activities | Cash Flow Activity (in thousands) | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | Change | % Change | |:------------------------------------------|:----------------------------------|:----------------------------------|:----------|:---------| | Net cash provided by operating activities | $139,470 | $125,044 | $14,426 | 11.5% | | Net cash used in investing activities | $(72,944) | $(79,317) | $6,373 | 8.0% | | Net cash used in financing activities | $(65,157) | $(33,838) | $(31,319) | (92.6)% | - Operating cash flows increased by **11.5%** due to higher revenues from office and multifamily portfolios, improved collections, and increased parking income[173](index=173&type=chunk) - Investing cash flows saw a decrease in usage by **8.0%**, primarily from reduced development capital expenditures, partially offset by a property acquisition deposit[173](index=173&type=chunk) - Financing cash flows showed a significant increase in usage by **92.6%**, mainly due to a **$30.0 million** decrease in net borrowings[173](index=173&type=chunk) [Critical Accounting Policies](index=54&type=section&id=Critical%20Accounting%20Policies) Reaffirms the company's critical accounting policies and the use of management estimates in financial reporting - No changes were made to critical accounting policies disclosed in the 2021 Annual Report on Form 10-K, with financial statements prepared in accordance with US GAAP requiring management estimates that could materially differ from actual results[175](index=175&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=54&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company actively manages market risk, particularly interest rate risk, through hedging strategies - All floating rate borrowings were hedged with interest rate swaps as of March 31, 2022, exposing the company to credit risk from counterparties, which is minimized by contracting with investment-grade financial institutions[176](index=176&type=chunk) - The transition from USD-LIBOR to SOFR by June 30, 2023, poses risks to loan interest payments, swap interest payments, and the valuation of loans and swaps, with potential acceleration if LIBOR becomes unavailable sooner[177](index=177&type=chunk) [Item 4. Controls and Procedures](index=54&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that disclosure controls and procedures were effective as of March 31, 2022, ensuring timely and accurate reporting - The CEO and CFO concluded that disclosure controls and procedures were effective as of March 31, 2022, ensuring information required for SEC reports is processed, recorded, summarized, and reported timely[179](index=179&type=chunk) - No changes in internal control over financial reporting occurred during Q1 2022 that materially affected, or are reasonably likely to materially affect, internal control over financial reporting[179](index=179&type=chunk) [PART II. OTHER INFORMATION](index=55&type=section&id=PART%20II.%20OTHER%20INFORMATION) Contains additional required disclosures not covered in the financial information section [Item 1. Legal Proceedings](index=55&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in routine legal proceedings but does not anticipate any material adverse effects on its business, financial condition, or results of operations - Excluding ordinary, routine litigation, the company is not currently a party to any legal proceedings expected to have a materially adverse effect on its business, financial condition, or results of operations[183](index=183&type=chunk) [Item 1A. Risk Factors](index=55&type=section&id=Item%201A.%20Risk%20Factors) There are no new material changes to the risk factors previously disclosed in the company's 2021 Annual Report on Form 10-K - No material changes to the risk factors disclosed in Part I, 'Item 1A. Risk Factors' in the 2021 Annual Report on Form 10-K were identified[184](index=184&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=55&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) There were no unregistered sales of equity securities or use of proceeds to report during the period - No unregistered sales of equity securities and use of proceeds to report[185](index=185&type=chunk)[189](index=189&type=chunk) [Item 3. Defaults Upon Senior Securities](index=55&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) There were no defaults upon senior securities to report during the period - No defaults upon senior securities to report[185](index=185&type=chunk)[190](index=190&type=chunk) [Item 4. Mine Safety Disclosures](index=55&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) Mine safety disclosures are not applicable to the company's operations - Mine safety disclosures are not applicable[185](index=185&type=chunk)[191](index=191&type=chunk) [Item 5. Other Information](index=55&type=section&id=Item%205.%20Other%20Information) There is no other information to report in this section - No other information to report[185](index=185&type=chunk)[192](index=192&type=chunk) [Item 6. Exhibits](index=55&type=section&id=Item%206.%20Exhibits) The report includes various exhibits, such as CEO and CFO certificates under Sarbanes-Oxley Act sections 302 and 906, and Inline XBRL documents for financial data - Exhibits include CEO and CFO certificates pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act of 2002, along with Inline XBRL documents for financial data[187](index=187&type=chunk)[188](index=188&type=chunk) [SIGNATURES](index=56&type=section&id=SIGNATURES) Provides the official signatures of the company's executives, certifying the report's accuracy and compliance - The report is signed by Jordan L. Kaplan, President and CEO, and Peter D. Seymour, CFO, on May 6, 2022, certifying its compliance with Exchange Act requirements[194](index=194&type=chunk)[195](index=195&type=chunk)

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K ☑ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2021 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: 1-33106 Douglas Emmett, Inc. (Exact name of registrant as specified in its charter) Maryland 20-3073047 (State or other jurisdiction of ...

Douglas Emmett, Inc. (NYSE:DEI) Q4 2021 Earnings Conference Call February 9, 2022 2:00 PM ET Company Participants Jordan Kaplan – President and Chief Executive Officer Kevin Crummy – Chief Investment Officer Peter Seymour – Chief Financial Officer Stuart McElhinney – Vice President of Investor Relations Conference Call Participants Alexander Goldfarb – Piper Sandler & Co. Craig Mailman – KeyBanc Capital Markets, Inc. Elvis Rodriguez – Bank of America Steve Sakwa – Evercore John Kim – BMO Capital Markets Em ...

United States Securities and Exchange Commission Washington, D.C. 20549 Title of Each Class Trading Symbol Name of Each Exchange on Which Registered Common Stock, $0.01 par value per share DEI New York Stock Exchange Class Outstanding at October 29, 2021 Common Stock, $0.01 par value per share 175,485,780 shares FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2021 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR ...

Douglas Emmett, Inc. (NYSE:DEI) Q3 2021 Earnings Conference Call November 3, 2021 2:00 PM ET Company Participants Stuart McElhinney - Vice President of Investor Relations Jordan Kaplan - President and Chief Executive Officer Kevin Crummy - Chief Investment Officer Peter Seymour - Chief Financial Officer Conference Call Participants Stephen Sakwa - Evercore ISI Alexander Goldfarb - Piper Sandler & Co. Craig Mailman - KeyBanc Capital Markets, Inc. John Kim - BMO Capital Markets Blaine Heck - Wells Fargo Secur ...

United States Securities and Exchange Commission Washington, D.C. 20549 Title of Each Class Trading Symbol Name of Each Exchange on Which Registered Common Stock, $0.01 par value per share DEI New York Stock Exchange Class Outstanding at July 30, 2021 Common Stock, $0.01 par value per share 175,472,472 shares FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2021 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) O ...

Douglas Emmett, Inc. (NYSE:DEI) Q2 2021 Earnings Conference Call August 4, 2021 2:00 PM ET Company Participants Stuart McElhinney - Vice President, Investor Relations Jordan Kaplan - President and CEO Kevin Crummy - Chief Investment Officer Peter Seymour - Chief Financial Officer Conference Call Participants Ardie Kamran - KeyBanc Capital Markets Elvis Rodriguez - Bank of America Parker Decraene - Citi Steve Sakwa - Evercore ISI Daniel Santos - Piper Sandler Rich Anderson - SMBC Frank Lee - BMO Bill Crow - ...

Douglas Emmett, Inc. (NYSE:DEI) Q1 2021 Earnings Conference Call May 5, 2020 2:00 PM ET Company Representatives Jordan Kaplan - President, Chief Executive Officer Kevin Crummy - Chief Investment Officer Peter Seymour - Chief Financial Officer Stuart McElhinney - Vice President of Investor Relations Conference Call Participants Steve Sakwa - Evercore ISI Manny Korchman - Citi Frank Lee - BMO Jamie Feldman - Bank of America Alexander Goldfarb - Piper Sandler Rich Anderson - SMBC Craig Mailman - KeyBanc Dave R ...

[PART I. FINANCIAL INFORMATION](index=8&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This section details the company's financial performance, condition, and management's analysis for the quarter ended March 31, 2021 [Financial Statements](index=8&type=section&id=Item%201.%20Financial%20Statements) Presents unaudited consolidated financial statements, showing total assets of $9.25 billion, liabilities of $5.23 billion, and a net income decline to $7.6 million [Consolidated Financial Statements](index=8&type=section&id=Consolidated%20Financial%20Statements) As of March 31, 2021, total assets were $9.25 billion, liabilities $5.23 billion, with net income sharply down to $7.6 million from $29.7 million year-over-year Consolidated Balance Sheet Summary (As of March 31, 2021) | Category | Amount (in thousands) | | :--- | :--- | | **Total Assets** | **$9,249,737** | | Investment in real estate, net | $8,850,908 | | Cash and cash equivalents | $184,274 | | **Total Liabilities** | **$5,229,212** | | Secured notes payable and revolving credit facility, net | $4,775,994 | | **Total Equity** | **$4,020,525** | Consolidated Statement of Operations Summary (Three Months Ended March 31) | Category | 2021 (in thousands) | 2020 (in thousands) | | :--- | :--- | :--- | | Total Revenues | $216,295 | $251,350 | | Total Operating Expenses | $173,857 | $187,132 | | **Net Income** | **$7,588** | **$29,714** | | Net Income per Share (basic and diluted) | $0.06 | $0.15 | Consolidated Statement of Cash Flows Summary (Three Months Ended March 31) | Category | 2021 (in thousands) | 2020 (in thousands) | | :--- | :--- | :--- | | Net cash provided by operating activities | $125,044 | $153,510 | | Net cash used in investing activities | ($79,317) | ($64,785) | | Net cash used in financing activities | ($33,838) | ($67,712) | [Notes to Consolidated Financial Statements](index=15&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Provides detailed disclosures on the company's REIT portfolio, debt structure, segment performance, and significant future development commitments - As of March 31, 2021, the company's consolidated portfolio consisted of a **17.8 million square foot office portfolio** and **4,325 multifamily apartment units**[33](index=33&type=chunk) - Charges for uncollectible tenant receivables and deferred rent receivables, primarily due to the COVID-19 pandemic, reduced office revenues by **$1.8 million** for the three months ended March 31, 2021[44](index=44&type=chunk) - The company has contractual commitments of approximately **$116.5 million** for development projects and **$22.6 million** for repositioning and capital expenditures[114](index=114&type=chunk) [Management's Discussion and Analysis (MD&A)](index=36&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Discusses the COVID-19 pandemic's adverse impact on operations, leading to a 19.6% FFO decrease and a 16.0% Same Property NOI decline, while highlighting solid liquidity [Overview and COVID-19 Impact](index=36&type=section&id=Overview%20and%20COVID-19%20Impact) The COVID-19 pandemic materially impacted operations, causing $1.8 million in tenant receivable write-offs and a 1% decline in office portfolio leased percentage - The company's rent collections were negatively impacted by unusually punitive ordinances in Los Angeles, Beverly Hills, and Santa Monica, which prohibit evictions and allow rent deferral for residential, retail, and office tenants[125](index=125&type=chunk) - In Q1 2021, the company wrote off **$1.8 million** in tenant receivables and deferred rent receivables, primarily due to the COVID-19 pandemic[126](index=126&type=chunk) - The total office portfolio leased percentage declined by **1% to 87.7%** due to new leasing volume remaining below pre-pandemic levels, while the multifamily portfolio remained strong at **99.6% leased**[127](index=127&type=chunk) [Developments and Rental Rate Trends](index=40&type=section&id=Developments%20and%20Rental%20Rate%20Trends) The company is advancing two major multifamily development projects, while rental rate trends show pressure with office straight-line rent down 0.3% and multifamily rent down 6.3% - The company is building a **34-story high-rise with 376 apartments** in West Los Angeles and converting a **25-story office tower into approximately 500 apartments** in downtown Honolulu[134](index=134&type=chunk)[135](index=135&type=chunk) Office Rent Roll (Q1 2021 vs. Expiring Leases) | Rent Type | Expiring Rate | New/Renewal Rate | Percentage Change | | :--- | :--- | :--- | :--- | | Cash Rent | $43.37 | $39.41 | (9.1)% | | Straight-line Rent | $40.25 | $40.13 | (0.3)% | - For multifamily properties, the rent on leases subject to change during Q1 2021 was **6.3% lower** than the prior rent on the same unit[143](index=143&type=chunk) [Non-GAAP Measures (FFO and Same Property NOI)](index=46&type=section&id=Non-GAAP%20Measures%20%28FFO%20and%20Same%20Property%20NOI%29) Funds From Operations (FFO) decreased 19.6% to $89.9 million, and Same Property Net Operating Income (NOI) fell 16.0% due to pandemic impacts - FFO for Q1 2021 decreased by **$21.9 million**, or **19.6%**, to **$89.9 million**, compared to $111.9 million for Q1 2020[155](index=155&type=chunk) Same Property NOI Change (Q1 2021 vs Q1 2020) | Segment | Change | Commentary | | :--- | :--- | :--- | | **Total NOI** | **(16.0)%** | Driven by declines in both segments | | Office NOI | (16.9)% | Due to lower collections, occupancy, and parking income | | Multifamily NOI | (9.2)% | Due to lower collections and rental rates | FFO Reconciliation (in thousands) | Line Item | Q1 2021 | Q1 2020 | | :--- | :--- | :--- | | Net income attributable to common stockholders | $11,601 | $26,923 | | Depreciation and amortization of real estate assets | $92,797 | $97,777 | | Adjustments for noncontrolling interests & unconsolidated Fund | ($14,461) | ($12,818) | | **FFO** | **$89,937** | **$111,882** | [Liquidity and Capital Resources](index=49&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains solid liquidity with $184.3 million in cash, $295 million credit facility availability, and 41% unencumbered office portfolio - As of March 31, 2021, the company had **$184.3 million** of cash and cash equivalents and a **$105.0 million** outstanding balance on its **$400.0 million** revolving credit facility[163](index=163&type=chunk) - Approximately **41%** of the company's total office portfolio is unencumbered, providing flexibility for future financing[165](index=165&type=chunk) - The company has an At-the-Market (ATM) program allowing it to sell up to **$400.0 million** of common stock to meet long-term liquidity needs[164](index=164&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=51&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company manages interest rate risk through swaps and is actively monitoring the transition from USD-LIBOR to alternative reference rates - The company's main market risk is interest rate risk, which it mitigates by using interest rate swaps to hedge its floating-rate debt; as of March 31, 2021, no consolidated floating-rate debt was unhedged, except for the revolving credit facility[172](index=172&type=chunk) - The company is managing the transition from USD-LIBOR to an alternative reference rate (like SOFR), as its floating-rate loans and swaps are indexed to LIBOR; the publication of most USD-LIBOR settings is expected to cease after June 30, 2023[173](index=173&type=chunk)[174](index=174&type=chunk)[175](index=175&type=chunk) [Controls and Procedures](index=51&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that disclosure controls and procedures were effective as of March 31, 2021, with no material changes - The CEO and CFO concluded that the company's disclosure controls and procedures were **effective** as of March 31, 2021[176](index=176&type=chunk) - No material changes to internal control over financial reporting occurred during the quarter ended March 31, 2021[176](index=176&type=chunk) [PART II. OTHER INFORMATION](index=52&type=section&id=PART%20II.%20OTHER%20INFORMATION) This section addresses legal proceedings and risk factors, confirming no material adverse legal actions or changes to previously disclosed risks [Legal Proceedings & Risk Factors](index=52&type=section&id=Item%201.%20Legal%20Proceedings%20%26%20Item%201A.%20Risk%20Factors) The company is not party to any material legal proceedings, and there are no material changes to previously disclosed risk factors - The company is not currently a party to any legal proceedings expected to have a materially adverse effect on its business[180](index=180&type=chunk) - There are no material changes to the risk factors disclosed in the company's 2020 Annual Report on Form 10-K[181](index=181&type=chunk)

[PART I](index=7&type=section&id=PART%20I) [Business](index=7&type=section&id=Item%201.%20Business) Douglas Emmett is a REIT focused on high-quality office and multifamily properties in Los Angeles and Honolulu, aiming for significant market share and maintaining REIT status - The company is a **REIT** focused on high-quality office and multifamily properties in Los Angeles and Honolulu, targeting submarkets with significant supply constraints[22](index=22&type=chunk) Portfolio Summary as of December 31, 2020 | Portfolio Type | Office Space (sq ft) | Multifamily Units | | :--- | :--- | :--- | | Consolidated Portfolio | 17.8 million | 4,287 | | Total Portfolio (incl. unconsolidated Fund) | 18.2 million | 4,287 | - The business strategy involves concentrating properties to gain substantial market share, averaging approximately **38%** of Class A office space in its submarkets, and utilizing a fully integrated operating platform with in-house leasing, management, and construction[26](index=26&type=chunk)[27](index=27&type=chunk) - The company operates through two segments: office real estate and multifamily real estate, employing approximately **700 people** as of year-end 2020[50](index=50&type=chunk)[51](index=51&type=chunk) - Local government ordinances related to the COVID-19 pandemic have impacted operations by prohibiting evictions and allowing rent deferrals for residential, retail, and office tenants[46](index=46&type=chunk) [Risk Factors](index=12&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant risks including the COVID-19 pandemic, geographic concentration, substantial debt, market competition, and regulatory compliance - The COVID-19 pandemic is a primary risk, potentially affecting rent collections, tenant demand, and operational costs[63](index=63&type=chunk)[64](index=64&type=chunk) - A high geographic concentration of properties in Los Angeles County and Honolulu exposes the company to localized economic downturns, regulatory changes, and natural disasters[67](index=67&type=chunk)[68](index=68&type=chunk) - The company has substantial debt, which creates risks related to interest rate fluctuations, refinancing, and potential default, which could be exacerbated during economic downturns[71](index=71&type=chunk)[72](index=72&type=chunk) - As of December 31, 2020, **11.4%** of the total office portfolio was available for lease, and leases for **13.3%** of the square footage were scheduled to expire in 2021, posing renewal and vacancy risks[85](index=85&type=chunk) - Failure to maintain its **REIT qualification** would lead to higher taxes and reduced cash available for distributions, significantly impacting financial performance[143](index=143&type=chunk)[144](index=144&type=chunk) [Unresolved Staff Comments](index=27&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company has no unresolved staff comments from the SEC - There are no unresolved staff comments[168](index=168&type=chunk) [Properties](index=28&type=section&id=Item%202.%20Properties) The company's portfolio includes 71 office properties and 12 multifamily properties, with detailed leasing statistics and tenant diversification Total Office Portfolio Summary (as of Dec 31, 2020) | Metric | Value | | :--- | :--- | | Number of Properties | 71 | | Rentable Square Feet | 18,192,265 | | Weighted Average Market Share | 38.0% | | Percent Leased | 88.6% | Total Multifamily Portfolio Summary (as of Dec 31, 2020) | Metric | Value | | :--- | :--- | | Number of Properties | 12 | | Number of Units | 4,287 | | Percent Leased | 98.2% | - The office portfolio is diversified across various industries, with the largest concentrations in Legal (**18.3%**), Financial Services (**14.9%**), and Entertainment (**13.5%**) based on annualized rent[180](index=180&type=chunk) - A significant portion of office leases are expiring in the near term, with **13.3%** of rentable square feet expiring in 2021 and **13.6%** in 2022[182](index=182&type=chunk) [Legal Proceedings](index=33&type=section&id=Item%203.%20Legal%20Proceedings) The company is not involved in any material legal proceedings that would adversely affect its operations - The company is not involved in any material legal proceedings outside the ordinary course of business[189](index=189&type=chunk) [Mine Safety Disclosures](index=33&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section is not applicable to the company's operations - No mine safety disclosures are reported[190](index=190&type=chunk) [PART II](index=34&type=section&id=PART%20II) [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=34&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock trades on the NYSE, declared increased dividends in 2020, and underperformed the S&P 500 over five years - The company's common stock is traded on the **New York Stock Exchange (NYSE)** under the ticker symbol '**DEI**'[193](index=193&type=chunk) Dividends Declared Per Common Share | Year | Q1 | Q2 | Q3 | Q4 | | :--- | :--- | :--- | :--- | :--- | | 2020 | $0.28 | $0.28 | $0.28 | $0.28 | | 2019 | $0.26 | $0.26 | $0.26 | $0.28 | - The cumulative total return on the company's common stock from December 31, 2015, to December 31, 2020, was **7.99%**, underperforming the S&P 500's return of **103.04%** over the same period[201](index=201&type=chunk) [Selected Financial Data](index=35&type=section&id=Item%206.%20Selected%20Financial%20Data) This section is blank due to the company's early adoption of SEC amendments eliminating this disclosure requirement - The company has ceased disclosing selected financial data in this item due to the early adoption of amendments to SEC Regulation S-K[7](index=7&type=chunk)[202](index=202&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=36&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the significant negative impact of the COVID-19 pandemic on 2020 results, affecting revenues, net income, FFO, and NOI [Impact of the COVID-19 Pandemic](index=37&type=section&id=Impact%20of%20the%20COVID-19%20Pandemic) The COVID-19 pandemic negatively impacted 2020 operations, leading to reduced rent collections, lower parking revenue, and a decline in office portfolio leased percentage - For the year ended December 31, 2020, charges for uncollectible tenant and deferred rent receivables, primarily due to the COVID-19 pandemic, reduced office revenues by **$41.0 million**[210](index=210&type=chunk) - The total office portfolio leased percentage declined by **4.7%** during 2020, ending the year at **88.6%**, as new leasing volume remained below pre-pandemic levels[211](index=211&type=chunk) [Results of Operations](index=42&type=section&id=Results%20of%20Operations) Total revenues and net income decreased in 2020, primarily due to pandemic impacts and a non-recurring gain in 2019 Comparison of Key Financial Metrics (2020 vs. 2019) | Metric (in thousands) | 2020 | 2019 | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Total Revenues | $891,523 | $936,682 | ($45,159) | (4.8)% | | Total Operating Expenses | $730,262 | $693,974 | ($36,288) | (5.2)% | | Net Income | $38,553 | $418,698 | ($380,145) | (90.8)% | | Net Income Attributable to Common Stockholders | $50,421 | $363,713 | ($313,292) | (86.1)% | - The significant decrease in Net Income was primarily due to a **$307.9 million** gain from the consolidation of a JV in 2019, which did not recur in 2020[243](index=243&type=chunk) [Non-GAAP Supplemental Financial Measures](index=47&type=section&id=Non-GAAP%20Supplemental%20Financial%20Measures) FFO decreased by 12.3% and total Same Property NOI by 14.7% in 2020 due to pandemic impacts on operating income Funds From Operations (FFO) Reconciliation (in thousands) | Metric | 2020 | 2019 | | :--- | :--- | :--- | | Net income attributable to common stockholders | $50,421 | $363,713 | | Adjustments (Depreciation, Gains, etc.) | $322,120 | $61,100 | | **FFO** | **$372,541** | **$424,813** | Same Property NOI Change (2020 vs. 2019) | Segment | 2020 NOI (in thousands) | 2019 NOI (in thousands) | % Change | | :--- | :--- | :--- | :--- | | Office | $455,621 | $537,839 | (15.3)% | | Multifamily | $42,967 | $46,894 | (8.4)% | | **Total** | **$498,588** | **$584,733** | **(14.7)%** | [Liquidity and Capital Resources](index=50&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains strong liquidity with $172.4 million cash and $325 million credit facility availability, funding needs through operations, debt, or equity - As of December 31, 2020, the company had **$172.4 million** of cash and cash equivalents and a **$75.0 million** balance on its **$400.0 million** revolving credit facility[258](index=258&type=chunk) Cash Flow Summary (in thousands) | Cash Flow Activity | 2020 | 2019 | | :--- | :--- | :--- | | Net cash provided by operating activities | $420,218 | $469,586 | | Net cash used in investing activities | ($265,175) | ($649,668) | | Net cash (used in) provided by financing activities | ($136,330) | $187,538 | [Quantitative and Qualitative Disclosures About Market Risk](index=54&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company manages interest rate risk on floating-rate debt using swaps and is monitoring the transition from LIBOR to SOFR - The company uses **interest rate swaps** to hedge interest rate risk on its floating-rate borrowings. As of December 31, 2020, no outstanding floating-rate debt was unhedged[280](index=280&type=chunk) - The company is monitoring the planned cessation of **LIBOR** after 2021 (or June 2023 for some settings) and the transition to alternative rates like **SOFR**, which could affect its floating-rate borrowings and interest rate swaps[281](index=281&type=chunk)[283](index=283&type=chunk) [Financial Statements and Supplementary Data](index=54&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section refers to detailed financial statements and schedules located in Part IV, Item 15 of the report - The full financial statements and supplementary data are located in Part IV, Item 15 of this report[284](index=284&type=chunk) [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=54&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports no changes in or disagreements with its accountants regarding accounting and financial disclosure - There were no disagreements with accountants on accounting and financial disclosure[285](index=285&type=chunk) [Controls and Procedures](index=55&type=section&id=Item%209A.%20Controls%20and%20Procedures) The company's disclosure controls and procedures were effective as of December 31, 2020, with no material changes to internal control - Management, including the CEO and CFO, concluded that as of December 31, 2020, the company's disclosure controls and procedures were **effective**[287](index=287&type=chunk) - No changes in internal control over financial reporting occurred during the quarter ended December 31, 2020, that materially affected, or are reasonably likely to materially affect, internal controls[288](index=288&type=chunk) [Other Information](index=55&type=section&id=Item%209B.%20Other%20Information) No other information is reported under this item - There is no information to report under this item[289](index=289&type=chunk) [PART III](index=56&type=section&id=PART%20III) [Directors, Executive Compensation, and Corporate Governance](index=56&type=section&id=Item%2010-14) Information for Items 10-14 is incorporated by reference from the company's 2021 Proxy Statement, covering directors, executive compensation, and governance - Information for Items 10, 11, 12, 13, and 14 is incorporated by reference from the company's 2021 Proxy Statement[292](index=292&type=chunk)[293](index=293&type=chunk)[296](index=296&type=chunk)[297](index=297&type=chunk) Securities Authorized for Issuance Under Stock-Based Compensation Plan (as of Dec 31, 2020) | Plan Category | Shares to be Issued (thousands) | Shares Remaining for Future Issuance (thousands) | | :--- | :--- | :--- | | Approved by stockholders | 2,855 | 9,062 | [PART IV](index=57&type=section&id=PART%20IV) [Exhibits and Financial Statement Schedule](index=57&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedule) This section includes the consolidated financial statements, notes, auditor's report, and exhibit schedule for the fiscal year ended December 31, 2020 [Consolidated Financial Statements](index=66&type=section&id=Consolidated%20Financial%20Statements) Audited financial statements show total assets of $9.25 billion, total revenues of $891.5 million, and net income of $50.4 million in 2020 Key Balance Sheet Data (as of Dec 31, 2020, in thousands) | Account | Amount | | :--- | :--- | | Total Assets | $9,250,825 | | Total Liabilities | $5,254,806 | | Total Equity | $3,996,019 | Key Income Statement Data (Year ended Dec 31, 2020, in thousands) | Account | Amount | | :--- | :--- | | Total Revenues | $891,523 | | Net Income | $38,553 | | Net Income Attributable to Common Stockholders | $50,421 | | EPS (basic and diluted) | $0.28 | Key Cash Flow Data (Year ended Dec 31, 2020, in thousands) | Account | Amount | | :--- | :--- | | Net Cash from Operating Activities | $420,218 | | Net Cash used in Investing Activities | ($265,175) | | Net Cash used in Financing Activities | ($136,330) | [Notes to Consolidated Financial Statements](index=74&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Notes detail accounting policies, real estate investment, debt, interest rate swaps, segment revenues, and development commitments - In December 2020, the company sold an 80,000 sq ft office property in Honolulu for **$21.0 million**, resulting in a **$6.4 million** gain[410](index=410&type=chunk) - As of December 31, 2020, total consolidated debt, net of unamortized costs, was **$4.74 billion**. The weighted average remaining life of the debt is **5.3 years** with a weighted average annual interest rate of **3.02%**[444](index=444&type=chunk)[446](index=446&type=chunk) - The company uses interest rate swaps to hedge its floating-rate debt. As of year-end, it had 39 consolidated derivative contracts with a total notional value of **$5.12 billion**[451](index=451&type=chunk) - As of December 31, 2020, the company had remaining contractual commitments of approximately **$148.2 million** for development projects and **$23.2 million** for repositioning and tenant improvements[503](index=503&type=chunk) [Form 10-K Summary](index=59&type=section&id=Item%2016.%20Form%2010-K%20Summary) This section is not applicable - No 10-K summary is provided[305](index=305&type=chunk)