Published: 2022-11-07 00:00:00 ET

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Form 10-Q

(Mark One)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2022

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: 1-13232 (Apartment Investment and Management Company)

Commission File Number: 0-56223 (Aimco OP L.P.)

Apartment Investment and Management Company

Aimco OP L.P.

(Exact name of registrant as specified in its charter)

 

Maryland (Apartment Investment and Management Company)		84-1259577
Delaware (Aimco OP L.P.)		85-2460835
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)
4582 South Ulster Street, Suite 1450
Denver, Colorado		80237
(Address of principal executive offices)		(Zip Code)

 

(303) 224-7900

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address, and former fiscal year, if changed since last report)

 

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

 

Title of Each Class		Trading Symbol(s)		Name of Each Exchange on Which Registered
Class A Common Stock (Apartment Investment and Management Company)		AIV		New York Stock Exchange

 

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

 

None (Apartment Investment and Management Company)

Partnership Common Units (Aimco OP L.P.)

(title of each class)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 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.

 

Apartment Investment and Management Company: Yes  ☒ No ☐		Aimco OP L.P.: Yes  ☒ 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).

 

Apartment Investment and Management Company: Yes  ☒ No ☐		Aimco OP L.P.: Yes  ☒ No ☐

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Apartment Investment and Management Company:

 

Large accelerated filer	☒			Accelerated filer	☐
Non-accelerated filer	☐			Smaller reporting company	☐
				Emerging growth company	☐

 

Aimco OP L.P.:

 

Large accelerated filer	☐			Accelerated filer	☐
Non-accelerated filer	☐			Smaller reporting company	☐
				Emerging growth company	☒

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 

Apartment Investment and Management Company:	☐		Aimco OP L.P.:	☒

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

 

Apartment Investment and Management Company: Yes ☐    No ☒		Aimco OP L.P.: Yes ☐    No ☒

The number of shares of Apartment Investment and Management Company Class A Common Stock outstanding as of November 4, 2022: 151,632,179

 

 

 

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EXPLANATORY NOTE

 

Apartment Investment and Management Company (“Aimco” or “the Company”), a Maryland corporation, is a self-administered and self-managed real estate investment trust, or REIT. On December 15, 2020, Aimco completed the separation of its business into two, separate and distinct, publicly traded companies, Aimco and Apartment Income REIT Corp. (“AIR”). The separation was effected by way of a pro rata distribution, in which stockholders of Aimco received one share of Class A common stock of AIR for every one share of Class A common stock of Aimco held as of the close of business on December 5, 2020. Apartment Income REIT, L.P. (“AIR Operating Partnership”), formerly known as “Aimco Properties, L.P.” until July 7, 2021, also completed a pro rata distribution of all of the outstanding common limited partnership units of Aimco OP L.P. (“Aimco Operating Partnership” and such units, “OP Units”) to holders of AIR Operating Partnership common limited partnership units and AIR Operating Partnership Class I High Performance partnership units as of the close of business on December 5, 2020. The transactions described in this paragraph are collectively referred to as the “Separation” and are governed by the terms of the Separation and Distribution Agreement (the “Separation Agreement”).

Aimco, through a wholly owned subsidiary, is the general partner and directly is the special limited partner of Aimco Operating Partnership. As of September 30, 2022, Aimco owned 92.7% of the legal interest in the common partnership units of Aimco Operating Partnership and 95.0% of the economic interest in Aimco Operating Partnership. The remaining 7.3% legal interest is owned by limited partners. As the sole general partner of Aimco Operating Partnership, Aimco has exclusive control of Aimco Operating Partnership’s day-to-day management.

Aimco Operating Partnership holds all of Aimco’s assets and manages the daily operations of Aimco’s business. Pursuant to the Aimco Operating Partnership agreement, Aimco is required to contribute to Aimco Operating Partnership all proceeds from the offerings of its securities. In exchange for the contribution of such proceeds, Aimco receives additional interests in Aimco Operating Partnership with similar terms (e.g., if Aimco contributes proceeds of a stock offering, Aimco receives partnership units with terms substantially similar to the stock issued by Aimco).

This filing combines the quarterly reports on Form 10-Q for the quarterly period ended September 30, 2022, of Aimco and Aimco Operating Partnership. Where it is important to distinguish between the two entities, we refer to them specifically. Otherwise, references to “we,” “us,” or “our” mean, collectively, Aimco, Aimco Operating Partnership, and their consolidated entities.

We believe combining the periodic reports of Aimco and Aimco Operating Partnership into this single report provides the following benefits:

We operate Aimco and Aimco Operating Partnership as one enterprise; the management of Aimco directs the management and operations of Aimco Operating Partnership; and Aimco OP GP, LLC, Aimco Operating Partnership’s general partner, is managed by Aimco.

We believe it is important to understand the few differences between Aimco and Aimco Operating Partnership in the context of how Aimco and Aimco Operating Partnership operate as a consolidated company. Aimco has no assets or liabilities other than its investment in Aimco Operating Partnership. Also, Aimco is a corporation that issues publicly traded equity from time to time, whereas Aimco Operating Partnership is a partnership that has no publicly traded equity. Except for the net proceeds from stock offerings by Aimco, which are contributed to Aimco Operating Partnership in exchange for additional limited partnership interests (of a similar type and in an amount equal to the shares of stock sold in the offering), Aimco Operating Partnership generates all remaining capital required by its business. These sources include Aimco Operating Partnership’s working capital, net cash provided by operating activities, borrowings under its revolving credit facility, the issuance of debt and equity securities, including additional partnership units, and proceeds received from the sale of real estate.

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Equity, partners’ capital, and noncontrolling interests are the main areas of difference between the condensed consolidated financial statements of Aimco and those of Aimco Operating Partnership. Interests in Aimco Operating Partnership held by entities other than Aimco, which we refer to as OP Units, are classified within partners’ capital in Aimco Operating Partnership’s condensed consolidated financial statements and as noncontrolling interests in Aimco’s condensed consolidated financial statements.

To help investors understand the differences between Aimco and Aimco Operating Partnership, this report provides: separate condensed consolidated financial statements for Aimco and Aimco Operating Partnership; a single set of condensed consolidated notes to such financial statements that includes separate discussions of each entity’s stockholders’ equity or partners’ capital, and earnings per share or earnings per unit, as applicable; and a combined Management’s Discussion and Analysis of Financial Condition and Results of Operations section that includes discrete information related to each entity, where appropriate.

This report also includes separate Part I, Item 4. Controls and Procedures sections and separate Exhibits 31 and 32 certifications for Aimco and Aimco Operating Partnership in order to establish that the requisite certifications have been made and that Aimco and Aimco Operating Partnership are both compliant with Rule 13a-15 or Rule 15d-15 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and 18 U.S.C. §1350.

 

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APARTMENT INVESTMENT AND MANAGEMENT COMPANY

AIMCO OP L.P.

 

TABLE OF CONTENTS

 

FORM 10-Q

		Page
	PART I. FINANCIAL INFORMATION
ITEM 1.	FINANCIAL STATEMENTS
	Apartment Investment and Management Company:
	Condensed Consolidated Balance Sheets (Unaudited)	4
	Condensed Consolidated Statements of Operations (Unaudited)	5
	Condensed Consolidated Statements of Equity (Unaudited)	6
	Condensed Consolidated Statements of Cash Flows (Unaudited)	8
	Aimco OP L.P.:
	Condensed Consolidated Balance Sheets (Unaudited)	9
	Condensed Consolidated Statements of Operations (Unaudited)	10
	Condensed Consolidated Statements of Partners’ Capital (Unaudited)	11
	Condensed Consolidated Statements of Cash Flows (Unaudited)	13
	Notes to the Condensed Consolidated Financial Statements of Apartment Investment and Management Company and Aimco OP L.P. (Unaudited)	14
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	29
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	41
ITEM 4.	CONTROLS AND PROCEDURES	41
	PART II. OTHER INFORMATION
ITEM 1A.	RISK FACTORS	43
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	43
ITEM 6.	EXHIBITS	45
Signatures		47

 

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PART I. FINANCIAL INFORMATION

 

ITEM 1. FINANCIAL STATEMENTS

APARTMENT INVESTMENT AND MANAGEMENT COMPANY

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

(Unaudited)

 

		September 30, 2022				December 31, 2021
ASSETS
Buildings and improvements		$	1,248,005			$	1,257,214
Land			639,272				534,285
Total real estate			1,887,277				1,791,499
Accumulated depreciation			(516,857	)			(561,115	)
Net real estate			1,370,420				1,230,384
Cash and cash equivalents			206,366				233,374
Restricted cash			19,075				11,208
Mezzanine investment			362,788				337,797
Interest rate options			61,448				25,657
Right-of-use lease assets			95,506				429,768
Other assets, net			180,641				165,913
Total assets		$	2,296,244			$	2,434,101
LIABILITIES AND EQUITY
Non-recourse property debt, net		$	859,593			$	483,137
Construction loans, net			80,816				163,570
Notes payable to AIR			—				534,127
Total indebtedness			940,409				1,180,834
Deferred tax liabilities			121,344				124,747
Lease liabilities			98,467				435,093
Accrued liabilities and other			125,132				97,400
Total liabilities			1,285,352				1,838,074
Redeemable noncontrolling interests in consolidated real estate partnerships			158,135				33,794
Commitments and contingencies (Note 4)
Equity:
Common Stock, $0.01 par value, 510,587,500 shares authorized at both September 30, 2022 and December 31, 2021, and 149,124,466 and 149,818,021 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively			1,492				1,498
Additional paid-in capital			514,341				521,842
Retained Earnings (accumulated deficit)			250,996				(22,775	)
Total Aimco equity			766,829				500,565
Noncontrolling interests in consolidated real estate partnerships			45,517				35,213
Common noncontrolling interests in Aimco Operating Partnership			40,411				26,455
Total equity			852,757				562,233
Total liabilities and equity		$	2,296,244			$	2,434,101

 

See notes to condensed consolidated financial statements.

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APARTMENT INVESTMENT AND MANAGEMENT COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

(Unaudited)

 

		Three Months Ended September 30,								Nine Months Ended September 30,
		2022				2021				2022				2021
REVENUES
Rental and other property revenues		$	47,683			$	42,893			$	148,375			$	123,115
OPERATING EXPENSES
Property operating expenses			17,455				18,155				56,384				51,500
Depreciation and amortization			85,438				21,709				143,420				63,065
General and administrative expenses			10,809				8,868				29,243				22,562
Total operating expenses			113,702				48,732				229,047				137,127
Interest expense			(9,719	)			(12,680	)			(65,865	)			(37,995	)
Mezzanine investment income, net			8,423				7,636				24,990				22,654
Realized and unrealized gains (losses) on interest rate options			9,209				2,231				48,005				10,608
Realized and unrealized gains (losses) on equity investments			(2,145	)			1,233				20,152				2,107
Gains on dispositions of real estate			75,539				—				170,004				—
Lease modification income			1,577				—				206,963				—
Other income (expense), net			(255	)			552				(1,743	)			2,959
Income (loss) before income tax			16,610				(6,867	)			321,834				(13,679	)
Income tax benefit (expense)			17,563				2,021				(24,338	)			9,881
Net income (loss)			34,173				(4,846	)			297,496				(3,798	)
Net (income) loss attributable to redeemable noncontrolling    interests in consolidated real estate partnerships			(2,907	)			(127	)			(5,446	)			(41	)
Net (income) loss attributable to noncontrolling interests    in consolidated real estate partnerships			(240	)			(296	)			(585	)			(862	)
Net (income) loss attributable to common noncontrolling    interests in Aimco Operating Partnership			(1,554	)			253				(14,648	)			209
Net income (loss) attributable to Aimco		$	29,472			$	(5,016	)		$	276,817			$	(4,492	)
Net income (loss) attributable to Aimco per common    share – basic (Note 6)		$	0.19			$	(0.03	)		$	1.82			$	(0.03	)
Net income (loss) attributable to Aimco per common    share – diluted (Note 6)		$	0.19			$	(0.03	)		$	1.81			$	(0.03	)
Weighted-average common shares outstanding – basic			149,611				149,762				149,706				149,517
Weighted-average common shares outstanding – diluted			151,197				149,762				151,076				149,517

 

See notes to condensed consolidated financial statements.

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APARTMENT INVESTMENT AND MANAGEMENT COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

For the Three Months Ended September 30, 2022 and 2021

(In thousands)

(Unaudited)

 

		Common Stock																				Noncontrolling Interests in				Common Noncontrolling Interests in
		Shares Issued				Amount				Additional Paid- in Capital				Retained Earnings (Accumulated Deficit)				Total Aimco Equity				Consolidated Real Estate Partnerships				Aimco Operating Partnership				Total Equity
Balances at June 30, 2021			149,663			$	1,496			$	517,540			$	(16,315	)		$	502,721			$	31,847			$	26,654			$	561,222
Net income (loss)			—				—				—				(5,016	)			(5,016	)			296				(253	)			(4,973	)
Redemption of OP Units			140				1				354				—				355				—				(361	)			(6	)
Share-based compensation expense			—				—				1,019				—				1,019				—				441				1,460
Contributions from noncontrolling interests			—				—				—				—				—				3,158				—				3,158
Distributions to noncontrolling interests			—				—				—				—				—				(287	)			—				(287	)
Other, net			—				1				—				(46	)			(45	)			—				—				(45	)
Balances at September 30, 2021			149,803			$	1,498			$	518,913			$	(21,377	)		$	499,034			$	35,014			$	26,481			$	560,529
Balances at June 30, 2022			149,097			$	1,492			$	515,065			$	224,567			$	741,124			$	44,665			$	39,233			$	825,022
Net income (loss)			—				—				—				29,472				29,472				240				1,554				31,266
Redemption of OP Units			26				—				398				—				398				—				(474	)			(76	)
Share-based compensation expense			—				—				1,454				—				1,454				—				258				1,712
Distributions to noncontrolling interests			—				—				—				—				—				(287	)			(160	)			(447	)
Contributions from noncontrolling interests			—				—				—				—				—				898				—				898
Purchase of noncontrolling interests in consolidated real estate partnerships			—				—				155				—				155				—				—				155
Common stock repurchased			(73	)			(1	)			(525	)			—				(526	)			—				—				(526	)
Cash Dividends			—				—				—				(3,043	)			(3,043	)			—				—				(3,043	)
Other, net			74				1				(2,206	)			—				(2,205	)			1				—				(2,204	)
Balances at September 30, 2022			149,124			$	1,492			$	514,341			$	250,996			$	766,829			$	45,517			$	40,411			$	852,757

 

 

See notes to condensed consolidated financial statements.

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APARTMENT INVESTMENT AND MANAGEMENT COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

For the Nine Months Ended September 30, 2022 and 2021

(In thousands)

(Unaudited)

 

		Common Stock																				Noncontrolling Interests in				Common Noncontrolling Interests in
		Shares Issued				Amount				Additional Paid- in Capital				Retained Earnings (Accumulated Deficit)				Total Aimco Equity				Consolidated Real Estate Partnerships				Aimco Operating Partnership				Total Equity
Balances at December 31, 2020			149,036			$	1,490			$	515,127			$	(16,839	)		$	499,778			$	31,877			$	27,436			$	559,091
Net income (loss)			—				—				—				(4,492	)			(4,492	)			862				(209	)			(3,839	)
Redemption of OP Units			580				6				1,252				—				1,258				—				(1,305	)			(47	)
Share-based compensation expense			—				—				1,770				—				1,770				—				559				2,329
Contributions from noncontrolling interests			—				—				—				—				—				3,158				—				3,158
Distributions to noncontrolling interests			—				—				—				—				—				(869	)			—				(869	)
Other common stock issuances			232				2				1,069				—				1,071				—				—				1,071
Other, net			(45	)			—				(305	)			(46	)			(351	)			(14	)			—				(365	)
Balances at September 30, 2021			149,803			$	1,498			$	518,913			$	(21,377	)		$	499,034			$	35,014			$	26,481			$	560,529
Balances at December 31, 2021			149,818			$	1,498			$	521,842			$	(22,775	)		$	500,565			$	35,213			$	26,455			$	562,233
Net income (loss)			—				—				—				276,817				276,817				585				14,648				292,050
Redemption of OP Units			65				1				1,932				—				1,933				—				(2,152	)			(219	)
Share-based compensation expense			—				—				4,234				—				4,234				—				1,515				5,749
Distributions to noncontrolling interests			—				—				—				—				—				(892	)			(160	)			(1,052	)
Contributions from noncontrolling interests			—				—				—				—				—				10,616				—				10,616
Purchase of noncontrolling interests in consolidated real estate partnerships			—				—				(7,088	)			—				(7,088	)			—				—				(7,088	)
Common stock repurchased			(816	)			(8	)			(4,937	)			—				(4,945	)			—				—				(4,945	)
Other Common Stock issuances			106				1				851				—				852				—				—				852
Redemption of redeemable noncontrolling interests in consolidated real estate partnerships			—				—				(183	)			—				(183	)			—				—				(183	)
Cash Dividends			—				—				—				(3,043	)			(3,043	)			—				—				(3,043	)
Other, net			(49	)			—				(2,310	)			(3	)			(2,313	)			(5	)			105				(2,213	)
Balances at September 30, 2022			149,124			$	1,492			$	514,341			$	250,996			$	766,829			$	45,517			$	40,411			$	852,757

 

See notes to condensed consolidated financial statements.

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APARTMENT INVESTMENT AND MANAGEMENT COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

	Nine Months Ended September 30,
	2022				2021
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	297,496			$	(3,798	)
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		143,420				63,065
Income from unconsolidated real estate partnerships		(459	)			(743	)
Realized and unrealized gains on interest rate options		(48,005	)			(10,608	)
Income tax expense (benefit)		24,338				(9,881	)
Amortization of debt issuance costs and other		2,149				801
Mezzanine investment, net		(24,990	)			(22,654	)
Loss on extinguishment of debt, net		28,901				—
Lease modification income		(206,963	)			—
Realized and unrealized gains (losses) on equity investments		(20,152	)			—
Gain on disposition of real estate		(170,004	)			—
Share-based compensation		6,462				3,750
Changes in operating assets and operating liabilities:
Other assets, net		5,904				(10,930	)
Net cash received from development property lease terminations		195,789				—
Accrued liabilities and other		(5,634	)			13,083
Total adjustments		(69,244	)			25,883
Net cash provided by operating activities		228,252				22,085
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of real estate		(130,122	)			(69,601	)
Capital expenditures (1)		(184,048	)			(134,855	)
Proceeds from disposition of real estate		243,134				—
Investment in IQHQ		(14,227	)			(12,091	)
Redemption of IQHQ investment		16,473
Investment in unconsolidated real estate partnerships		(12,878	)			—
Other investing activities		(1,293	)			(96	)
Net cash used in investing activities		(82,961	)			(216,643	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from non-recourse property debt		674,720				59,757
Proceeds from construction loans		54,286				142,305
Payments of deferred loan costs		(8,244	)			(6,634	)
Principal repayments on non-recourse property debt		(284,562	)			(22,307	)
Principal repayments on construction loans		(138,404	)			—
Principal repayments on Notes Payable to AIR		(534,127	)			—
Purchase of interest rate options		(3,223	)			(5,905	)
Proceeds from interest rate option		15,465				—
Payments on finance leases		(25,797	)			(7,773	)
Payments of prepayment premiums		(25,740	)			—
Common stock repurchased		(4,419	)			—
Dividend paid on common stock		(3,043	)
Distributions to noncontrolling interests		(1,052	)			—
Distributions to redeemable noncontrolling interests		(917	)
Contributions from noncontrolling interests		10,616				—
Contributions from redeemable noncontrolling interests		122,413				—
Redemption of common and preferred OP units		(209	)			—
Redemption of noncontrolling interests		(7,088	)			—
Redemption of redeemable noncontrolling interests		(5,094	)			—
Other financing activities		(13	)			(859	)
Net cash provided by (used in) financing activities		(164,432	)			158,584
NET DECREASE IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH		(19,141	)			(35,974	)
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH AT BEGINNING OF PERIOD		244,582				298,735
CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT END OF PERIOD	$	225,441			$	262,761

(1) Accrued capital expenditures were $31.4 million and $19.4 million as of September 30, 2022 and 2021, respectively.

See notes to condensed consolidated financial statements.

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AIMCO OP L.P.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

(Unaudited)

 

		September 30, 2022				December 31, 2021
ASSETS
Buildings and improvements		$	1,248,005			$	1,257,214
Land			639,272				534,285
Total real estate			1,887,277				1,791,499
Accumulated depreciation			(516,857	)			(561,115	)
Net real estate			1,370,420				1,230,384
Cash and cash equivalents			206,366				233,374
Restricted cash			19,075				11,208
Mezzanine investment			362,788				337,797
Interest rate options			61,448				25,657
Right-of-use lease assets			95,506				429,768
Other assets, net			180,641				165,913
Total assets		$	2,296,244			$	2,434,101
LIABILITIES AND EQUITY
Non-recourse property debt, net		$	859,593			$	483,137
Construction loans, net			80,816				163,570
Notes payable to AIR			—				534,127
Total indebtedness			940,409				1,180,834
Deferred tax liabilities			121,344				124,747
Lease liabilities			98,467				435,093
Accrued liabilities and other			125,132				97,400
Total liabilities			1,285,352				1,838,074
Redeemable noncontrolling interests in consolidated real estate partnerships			158,135				33,794
Commitments and contingencies (Note 4)
Partners’ capital:
General Partner and Special Limited Partner			766,829				500,565
Limited Partners			40,411				26,455
Partners’ capital attributable to Aimco Operating Partnership			807,240				527,020
Noncontrolling interests in consolidated real estate partnerships			45,517				35,213
Total partners’ capital			852,757				562,233
Total liabilities and partners’ capital		$	2,296,244			$	2,434,101

 

See notes to condensed consolidated financial statements.

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AIMCO OP L.P.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per unit data)

(Unaudited)

 

		Three Months Ended September 30,								Nine Months Ended September 30,
		2022				2021				2022				2021
REVENUES
Rental and other property revenues		$	47,683			$	42,893			$	148,375			$	123,115
OPERATING EXPENSES
Property operating expenses			17,455				18,155				56,384				51,500
Depreciation and amortization			85,438				21,709				143,420				63,065
General and administrative expenses			10,809				8,868				29,243				22,562
Total operating expenses			113,702				48,732				229,047				137,127
Interest expense			(9,719	)			(12,680	)			(65,865	)			(37,995	)
Mezzanine investment income, net			8,423				7,636				24,990				22,654
Realized and unrealized gains (losses) on interest rate options			9,209				2,231				48,005				10,608
Realized and unrealized gains (losses) on equity investments			(2,145	)			1,233				20,152				2,107
Gains on dispositions of real estate			75,539				-				170,004				-
Lease modification income			1,577				-				206,963				-
Other income (expense), net			(255	)			552				(1,743	)			2,959
Income (loss) before income tax			16,610				(6,867	)			321,834				(13,679	)
Income tax benefit (expense)			17,563				2,021				(24,338	)			9,881
Net income (loss)			34,173				(4,846	)			297,496				(3,798	)
Net (income) loss attributable to redeemable noncontrolling    interests in consolidated real estate partnerships			(2,907	)			(127	)			(5,446	)			(41	)
Net (income) loss attributable to noncontrolling interests    in consolidated real estate partnerships			(240	)			(296	)			(585	)			(862	)
Net income (loss) attributable to Aimco Operating      Partnership		$	31,026			$	(5,269	)		$	291,465			$	(4,701	)
Net income (loss) attributable to Aimco Operating      Partnership per common unit – basic (Note 6)		$	0.19			$	(0.03	)		$	1.82			$	(0.03	)
Net income (loss) attributable to Aimco Operating      Partnership per common unit – diluted (Note 6)		$	0.19			$	(0.03	)		$	1.81			$	(0.03	)
Weighted-average common units outstanding – basic			157,530				157,806				157,627				157,873
Weighted-average common units outstanding – diluted			159,136				157,806				159,017				157,873

 

See notes to condensed consolidated financial statements.

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AIMCO OP L.P.

CONDENSED CONSOLIDATED STATEMENTS OF PARTNERS’ CAPITAL

For the three months ended September 30, 2022 and 2021

(In thousands)

(Unaudited)

 

		General Partner and Special Limited Partner				Limited Partners				Partners’ Capital Attributable to Aimco Operating Partnership				Noncontrolling Interests in Consolidated Real Estate Partnerships				Total Partners’ Capital
Balances at June 30, 2021		$	502,721			$	26,654			$	529,375			$	31,847			$	561,222
Net income (loss)			(5,016	)			(253	)			(5,269	)			296				(4,973	)
Redemption of OP Units			355				(361	)			(6	)			—				(6	)
Share-based compensation expense			1,019				441				1,460				—				1,460
Contributions from noncontrolling interests			—				—				—				3,158				3,158
Distributions to noncontrolling interests			—				—				—				(287	)			(287	)
Other, net			(45	)			—				(45	)			—				(45	)
Balances at September 30, 2021		$	499,034			$	26,481			$	525,515			$	35,014			$	560,529
Balances at June 30, 2022		$	741,124			$	39,233			$	780,357			$	44,665			$	825,022
Net income (loss)			29,472				1,554				31,026				240				31,266
Redemption of OP Units			398				(474	)			(76	)			—				(76	)
Share-based compensation expense			1,454				258				1,712				—				1,712
Distributions to noncontrolling interests			—				(160	)			(160	)			(287	)			(447	)
Contributions from noncontrolling interests			—				—				—				898				898
Purchase of noncontrolling interests in consolidated real estate partnerships			155				—				155				—				155
Repurchases of OP Units held by Aimco			(526	)			—				(526	)			—				(526	)
Cash Dividends			(3,043	)			—				(3,043	)			—				(3,043	)
Other, net			(2,205	)			—				(2,205	)			1				(2,204	)
Balances at September 30, 2022		$	766,829			$	40,411			$	807,240			$	45,517			$	852,757

 

 

 

 

See notes to condensed consolidated financial statements.

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AIMCO OP L.P.

CONDENSED CONSOLIDATED STATEMENTS OF PARTNERS’ CAPITAL

For the nine months ended September 30, 2022 and 2021

(In thousands)

(Unaudited)

 

		General Partner and Special Limited Partner				Limited Partners				Partners’ Capital Attributable to Aimco Operating Partnership				Noncontrolling Interests in Consolidated Real Estate Partnerships				Total Partners’ Capital
Balances at December 31, 2020		$	499,778			$	27,436			$	527,214			$	31,877			$	559,091
Net income (loss)			(4,492	)			(209	)			(4,701	)			862				(3,839	)
Redemption of OP Units			1,258				(1,305	)			(47	)			—				(47	)
Other common stock issuances			1,071				—				1,071				—				1,071
Share-based compensation expense			1,770				559				2,329				—				2,329
Contribution from noncontrolling interests			—				—				—				3,158				3,158
Distributions to noncontrolling interests			—				—				—				(869	)			(869	)
Other, net			(351	)			—				(351	)			(14	)			(365	)
Balances at September 30, 2021		$	499,034			$	26,481			$	525,515			$	35,014			$	560,529
Balances at December 31, 2021		$	500,565			$	26,455			$	527,020			$	35,213			$	562,233
Net income (loss)			276,817				14,648				291,465				585				292,050
Redemption of OP Units			1,933				(2,152	)			(219	)			—				(219	)
Share-based compensation expense			4,234				1,515				5,749				—				5,749
Distributions to noncontrolling interests			—				(160	)			(160	)			(892	)			(1,052	)
Contributions from noncontrolling interests			—				—				—				10,616				10,616
Purchase of noncontrolling interests in consolidated real estate partnerships			(7,088	)			—				(7,088	)			—				(7,088	)
Repurchases of OP Units held by Aimco			(4,945	)			—				(4,945	)			—				(4,945	)
Other OP Unit issuances			852				109				961				—				961
Redemption of redeemable noncontrolling interests in consolidated real estate partnerships			(183	)			—				(183	)			—				(183	)
Cash dividends			(3,043	)			—				(3,043	)			—				(3,043	)
Other, net			(2,313	)			(4	)			(2,317	)			(5	)			(2,322	)
Balances at September 30, 2022		$	766,829			$	40,411			$	807,240			$	45,517			$	852,757

 

See notes to condensed consolidated financial statements.

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AIMCO OP L.P.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

	Nine Months Ended September 30,
	2022				2021
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	297,496			$	(3,798	)
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		143,420				63,065
Income from unconsolidated real estate partnerships		(459	)			(743	)
Realized and unrealized gains on interest rate options		(48,005	)			(10,608	)
Income tax expense (benefit)		24,338				(9,881	)
Amortization of debt issuance costs and other		2,149				801
Mezzanine investment, net		(24,990	)			(22,654	)
Loss on extinguishment of debt, net		28,901				—
Lease modification income		(206,963	)			—
Realized and unrealized gains (losses) on equity investments		(20,152	)			—
Gain on disposition of real estate		(170,004	)			—
Share-based compensation		6,462				3,750
Changes in operating assets and operating liabilities:
Other assets, net		5,904				(10,930	)
Net cash received from development property lease terminations		195,789				—
Accrued liabilities and other		(5,634	)			13,083
Total adjustments		(69,244	)			25,883
Net cash provided by operating activities		228,252				22,085
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of real estate		(130,122	)			(69,601	)
Capital expenditures (1)		(184,048	)			(134,855	)
Proceeds from disposition of real estate		243,134				—
Investment in IQHQ		(14,227	)			(12,091	)
Redemption of IQHQ investment		16,473
Investment in unconsolidated real estate partnerships		(12,878	)			—
Other investing activities		(1,293	)			(96	)
Net cash used in investing activities		(82,961	)			(216,643	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from non-recourse property debt		674,720				59,757
Proceeds from construction loans		54,286				142,305
Payments of deferred loan costs		(8,244	)			(6,634	)
Principal repayments on non-recourse property debt		(284,562	)			(22,307	)
Principal repayments on construction loans		(138,404	)			—
Principal repayments on Notes Payable to AIR		(534,127	)			(5,905	)
Purchase of interest rate options		(3,223	)			—
Proceeds from interest rate option		15,465				(7,773	)
Payments on finance leases		(25,797	)			—
Payments of prepayment premiums		(25,740	)			—
Common stock repurchased		(4,419	)			—
Dividend paid on common stock		(3,043	)			—
Distributions to noncontrolling interests		(1,052	)			—
Distributions to redeemable noncontrolling interests		(917	)			—
Contributions from noncontrolling interests		10,616				—
Contributions from redeemable noncontrolling interests		122,413
Redemption of common and preferred OP units		(209	)
Redemption of noncontrolling interests		(7,088	)
Redemption of redeemable noncontrolling interests		(5,094	)			—
Other financing activities		(13	)			(859	)
Net cash provided by (used in) financing activities		(164,432	)			158,584
NET DECREASE IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH		(19,141	)			(35,974	)
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH AT BEGINNING OF PERIOD		244,582				298,735
CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT END OF PERIOD	$	225,441			$	262,761

(1) Accrued capital expenditures were $31.4 million and $19.4 million as of September 30, 2022 and 2021, respectively.

See notes to condensed consolidated financial statements.

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APARTMENT INVESTMENT AND MANAGEMENT COMPANY

AIMCO OP L.P.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022

(Unaudited)

 

 

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward Looking Statements

The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward-looking statements in certain circumstances. Certain information included in this Quarterly Report on Form 10-Q contains or may contain information that is forward-looking within the meaning of the federal securities laws, including, without limitation, statements regarding: the ongoing relationship between Aimco and AIR (the “Separate Entities”) following the Separation; the impact of the COVID-19 pandemic, including on our ability to maintain current or meet projected occupancy, rental rate and property operating results; the effect of acquisitions, dispositions, developments, and redevelopments; including our ability to meet budgeted costs and timelines, and achieve budgeted rental rates related to our development and redevelopment investments; expectations regarding sales of our apartment communities and the use of proceeds thereof; the availability and cost of corporate debt; and our ability to comply with debt covenants, including financial coverage ratios; and the outcome and consequences of the current proxy contest with Land & Buildings Capital Growth, L.P.("Land & Buildings").

These forward-looking statements are based on management’s judgment as of this date, which is subject to risks and uncertainties that could cause actual results to differ materially from our expectations, including, but not limited to: the effects of the coronavirus pandemic on Aimco’s business and on the global and U.S. economies generally, and the ongoing, dynamic and uncertain nature and duration of the pandemic, geopolitical events which may adversely affect the markets in which our securities trade, and other macroeconomic conditions, including, among other things, supply chain challenges and rising interest rates, all of which heightens the impact of the other risks and factors

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described herein, and the impact on entities in which Aimco holds a partial interest, including its indirect interest in the partnership that owns Parkmerced Apartments, and the impact of coronavirus related governmental lockdowns on Aimco’s residents, commercial tenants, and operations; real estate and operating risks, including fluctuations in real estate values and the general economic climate in the markets in which we operate and competition for residents in such markets; national and local economic conditions, including the pace of job growth and the level of unemployment; the amount, location and quality of competitive new housing supply; the timing and effects of acquisitions, dispositions, developments and redevelopments; expectations regarding sales of apartment communities and the use of proceeds thereof; insurance risks, including the cost of insurance, and natural disasters and severe weather such as hurricanes; supply chain disruptions, particularly with respect to raw materials such as lumber, steel, and concrete; financing risks, including the availability and cost of financing; the risk that cash flows from operations may be insufficient to meet required payments of principal and interest; the risk that earnings may not be sufficient to maintain compliance with debt covenants, including financial coverage ratios; legal and regulatory risks, including costs associated with prosecuting or defending claims and any adverse outcomes; the terms of laws and governmental regulations that affect us and interpretations of those laws and regulations; possible environmental liabilities, including costs, fines or penalties that may be incurred due to necessary remediation of contamination of real estate presently or previously owned by Aimco; the relationship between Aimco and Separate Entities after the Separation; the ability and willingness of the Separate Entities and their subsidiaries to meet and/or perform their obligations under the contractual arrangements that were entered into among the parties in connection with the Separation and any of their obligations to indemnify, defend and hold the other party harmless from and against various claims, litigation and liabilities; and the ability to achieve some or all the benefits that we expect to achieve from the Separation; the outcome and consequences of activist stockholders on our business; and such other risks and uncertainties described from time to time in our filings with the Securities and Exchange Commission (“SEC”).

In addition, our current and continuing qualification as a real estate investment trust involves the application of highly technical and complex provisions of the Internal Revenue Code of 1986, as amended (the “Code”) and depends on our ability to meet the various requirements imposed by the Code through actual operating results, distribution levels and diversity of stock ownership.

Readers should carefully review our financial statements and the notes thereto, as well as Item 1A. Risk Factors in Part II of this report. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included elsewhere in this Quarterly Report on Form 10-Q. We undertake no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law.

Readers should also carefully review the section entitled “Risk Factors” described in Item 1A of Apartment Investment and Management Company’s and Aimco OP L.P.’s combined Annual Report on Form 10-K for the year ended December 31, 2021, and subsequent documents we file from time to time with the SEC.

As used herein and except as the context otherwise requires, “we,” “our,” and “us” refer to Apartment Investment and Management Company (which we refer to as Aimco), Aimco OP L.P. (which we refer to as Aimco Operating Partnership) and their consolidated subsidiaries, collectively.

Certain financial and operating measures found herein and used by management are not defined under accounting principles generally accepted in the United States ("GAAP"). These measures are defined and reconciled to the most comparable GAAP measures under the Non-GAAP Measures heading.

Executive Overview

Our mission is to make real estate investments, primarily focused on the multifamily sector within the continental United States, where outcomes are enhanced through our human capital so that substantial value is created for investors, teammates, and the communities in which we operate.

Our value proposition includes our:

Our primary goal is outsized risk adjusted returns and accelerating growth for our shareholders. We are focused on providing superior total-return performance to shareholders, primarily through capital appreciation driven by accretive investment and active portfolio management over multi-year periods. We plan to reinvest earnings to facilitate growth and, therefore, do not presently intend to pay a regular quarterly cash dividend.

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Our financial objectives are to create value and produce superior, project-level, risk-adjusted returns on equity as measured by the investment period Internal Rate of Return (“IRR”) and the project-level Multiple on Invested Capital (“MOIC”). We measure broader performance based on Net Asset Value (“NAV”) growth over time.

Our capital allocation strategy has been designed to leverage our investment platform and optimize risk-adjusted returns for our shareholders.

Overall, we target a growth-oriented capital allocation, primarily weighted toward direct investment in “Value Add” and “Opportunistic” multifamily real estate.

From time to time, we expect to allocate a limited/small portion of our capital to passive debt and equity investments, both directly and indirectly. We may also utilize our established platform and existing relationships to generate fees through service offerings.

We have policies in place that support our strategy, guide our investment allocations, and manage risk, including to hold at all times a sizeable portion of our net equity in a diversified portfolio of “Core” and “Core-Plus” assets and before starting a project, require cash or committed credit necessary for completion.

Given our stated strategy, it is expected that at any point in time the value-creation process will be ongoing at numerous of our investments. Over time, we expect the Aimco enterprise to produce superior returns on equity on a risk-adjusted basis and it is our plan to do so by:

We have corporate headquarters in Denver, Colorado and Bethesda, Maryland. Our investment platform is managed by experienced professionals based in four regions: West Coast, Central and Mountain West, Mid-Atlantic and Northeast, and Southeast. By regionalizing this platform, we are able to leverage the in-depth local market knowledge of each regional leader, creating a comparative advantage when sourcing, evaluating, and executing investment opportunities.

Our dedicated team will source and execute development and redevelopment projects, and various other direct investment strategies. The Aimco development and redevelopment portfolio currently includes $0.6 billion of projects in construction and lease-up. In addition, since the Separation, our team has secured significant, high-quality, future development opportunities, more than tripling Aimco’s controlled pipeline to a total potential of more than 15 million square feet, located in high-growth markets. Generally, we seek direct investment opportunities in locations where barriers to entry are high, target customers can be clearly defined and where we have a comparative advantage over others in the market.

Our entire portfolio of operating properties includes 26 apartment communities (22 consolidated properties and four unconsolidated properties) with average rents in line with local market averages (generally defined as B class). We also own one commercial office building that is part of an assemblage with an adjacent apartment building. The target composition of our stabilized portfolio will continue to include primarily B multifamily assets, spread across a geographically diversified portfolio and with a bias toward long established residential neighborhoods that rank highly in regard to schools, employment fundamentals and state and regional governance. Core-Plus opportunities offer the opportunity for incremental capital investment while maintaining stabilized cashflow to accelerate income growth and improve asset values.

We expect to allocate a limited portion of our capital to passive debt and equity investments, both directly and at the entity level when warranted by risk adjusted returns. Our current allocation to alternative investments includes: our indirect interest mezzanine loan to the Parkmerced partnership which owns 3,165 apartment homes and future development rights in San Francisco, California, and our passive equity investments in IQHQ, Inc. (“IQHQ”), a privately held life sciences real estate development company, and in property technology funds consisting of entities that develop technology related to the real estate industry.

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At all times, we will guard our liquidity by maintaining sufficient cash and committed credit.

From time-to-time, we will allocate capital to financial assets designed to mitigate risks elsewhere in the Aimco enterprise. Existing examples include our option to acquire an interest rate swap designed to protect against repricing risk on our maturing liabilities and the use of interest rate caps to provide protection against increases in interest rates on in-place loans.

We expect to capitalize our activities through a combination of non-recourse property debt, construction loans, third-party equity, and the recycling of Aimco equity, including retained earnings. We plan to limit the use of recourse leverage, with a strong preference towards non-recourse property-level debt in order to limit risk to the Aimco enterprise. When warranted, we plan to seek equity capital from joint venture partners to improve our cost of capital, further leverage Aimco equity, reduce exposure to a single investment and, in certain cases, for strategic benefits.

The results from the execution of our business plan during the three and nine months ended September 30, 2022 are further described below.

Financial Results and Recent Highlights

 

Value Add, Opportunistic & Alternative Investments

Development and Redevelopment

We generally seek development and redevelopment opportunities where barriers to entry are high, target customers can be clearly defined, and where we have a comparative advantage over others in the market. Our Value Add and Opportunistic investments may also target portfolio acquisitions, operational turnarounds, and re-entitlements.

We currently have four active development and redevelopment projects, located across four U.S. markets, in varying phases of construction and lease-up. These projects remain on track, as measured by budget, lease-up metrics, and current market valuations. During the three and nine months ended September 30, 2022, we invested $60.6 million and $188.9 million respectively, in development and redevelopment activities. Updates include:

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Alternative Investments

Aimco makes alternative investments where it has special knowledge or expertise relevant to the venture and opportunity exists for positive asymmetric outcomes. Aimco's current alternative investments include a mezzanine loan secured by a stabilized multifamily property with an option to participate in future multi-family development as well as three passive equity investments. Updates include:

Investment Activity

Aimco is focused on development and redevelopment, funded through our joint ventures. Aimco will also consider opportunistic investments in related activities. Updates include:

 

Operating Property Results

Aimco owns a diversified portfolio of stabilized apartment communities located in eight major U.S. markets with average rents in line with local market averages. We also own a commercial office building that is part of an assemblage with an adjacent apartment building.

Highlights for the three months ended September 30, 2022 include:

Balance Sheet and Financing Activity

We are highly focused on maintaining a strong balance sheet, including having at all times ample liquidity. As of September 30, 2022, we had access to $375.4 million in liquidity, including $206.3 million of cash on hand, $19.1 million of restricted cash, and the capacity to borrow up to $150.0 million on our revolving credit facility. Refer to the Liquidity and Capital Resources section for additional information regarding our leverage.

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Financial Results of Operations

We have three segments: (i) Development and Redevelopment, (ii) Operating, and (iii) Other.

Our Development and Redevelopment segment consists of properties that are under construction or have not achieved stabilization, as well as land assemblages that are being held for development adjacent to The Hamilton community and other land purchases. Our Operating segment includes 21 residential apartment communities that have achieved stabilized level of operations as of January 1, 2021 and maintained it throughout the current year and comparable period. We aggregate all our apartment communities that have reached stabilization into our Operating segment. Our Other segment consists of properties that are not included in our Development and Redevelopment or Operating segments.

The following discussion and analysis of the results of our operations and financial condition should be read in conjunction with the accompanying condensed consolidated financial statements included in Item 1.

Three and Nine Months Ended September 30, 2022 compared with the Three and Nine Months Ended September 30, 2021

Net income increased by $34.5 million and by $281.3 million during the three and nine months ended September 30, 2022, respectively, compared to the same periods in 2021, as described more fully below.

Property Results

As of September 30, 2022, our Development and Redevelopment segment included four properties that were under construction. Our Operating segment included 21 communities with 5,582 apartment homes, and our Other segment included our recent Eldridge Townhomes acquisition, and one office building.

We use proportionate property net operating income to assess the operating performance of our segments. Proportionate property net operating income is defined as our share of rental and other property revenues, less direct property operating expenses, but

Please refer to Note 10 to the condensed consolidated financial statements in Item 1 for further discussion regarding our segments, including a reconciliation of these proportionate amounts to consolidated rental and other property revenues and property operating expenses.

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Proportionate Property Net Operating Income

The results of our segments for the three months ended September 30, 2022 and 2021, as presented below, are based on segment classifications as of September 30, 2022:

	Three Months Ended September 30,
(in thousands)	2022				2021				$ Change				% Change
Rental and other property revenues, before utility reimbursements:
Development and Redevelopment	$	123			$	256			$	(133	)			(52.0	%)
Operating		34,691				31,126				3,565				11.5	%
Other		4,241				3,459				782				22.6	%
Total		39,055				34,841				4,214				12.1	%
Property operating expenses, net of utility reimbursements:
Development and Redevelopment		336				472				(136	)			(28.8	%)
Operating		10,220				10,301				(81	)			(0.8	%)
Other		1,264				1,124				140				12.5	%
Total		11,820				11,897				(77	)			(0.6	%)
Proportionate property net operating income:
Development and Redevelopment		(213	)			(216	)			3				(1.4	%)
Operating		24,471				20,825				3,646				17.5	%
Other		2,977				2,335				642				27.5	%
Total	$	27,235			$	22,944			$	4,291				18.7	%

For the three months ended September 30, 2022, compared to the same period in 2021:

The results of our segments for the nine months ended September 30, 2022 and 2021, as presented below, are based on segment classifications as of September 30, 2022:

	Nine Months Ended September 30,								Historical Change
(in thousands)	2022				2021				$				%
Rental and other property revenues, before utility reimbursements:
Development and Redevelopment	$	204			$	2,006				(1,802	)			(89.8	%)
Operating		100,052				90,176				9,876				11.0	%
Other		13,619				9,783				3,836				39.2	%
Total		113,875				101,965				11,910				11.7	%
Property operating expenses, net of utility reimbursements:
Development and Redevelopment		908				1,737				(829	)			(47.7	%)
Operating		30,916				30,461				455				1.5	%
Other		4,085				3,251				834				25.7	%
Total		35,909				35,449				460				1.3	%
Proportionate property net operating income:
Development and Redevelopment		(704	)			269				(973	)			(100.0	%)
Operating		69,136				59,715				9,421				15.8	%
Other		9,534				6,532				3,002				46.0	%
Total	$	77,966			$	66,516			$	11,450				17.2	%

For the nine months ended September 30, 2022, compared to the same period in 2021:

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Non-Segment Real Estate Operations

Operating income amounts not attributed to our segments include property management costs, casualty losses, and, if applicable, the results of apartment communities sold or held for sale, reported in consolidated amounts, which we do not allocate to our segments for purposes of evaluating segment performance.

Depreciation and Amortization

For the three and nine months ended September 30, 2022, depreciation and amortization expense increased by $63.7 million, or 100%, and $80.4 million, or 100%, respectively, when compared to the same periods in 2021, primarily due to accelerated depreciation recognized relating to the lease termination transaction in the amount of $69.9 million and $85.7 million for the three and nine months ended September 30, 2022, respectively.

General and Administrative Expenses

For the three months ended September 30, 2022, general and administrative expenses increased by $1.9 million, or 21.9% compared to the three months ended September 30, 2021. For the nine months ended September 30, 2022, general and administrative expenses increased by $6.7 million, or 29.6% compared to the nine months ended September 30, 2021. General and administrative expenses incurred for the three and nine months ended September 30, 2021 were prior to the full build out of our platform and are not representative of what we believe our anticipated expenses will be going forward. Additionally, for three and nine months ended September 30, 2022 and 2021, general and administrative expenses included $1.7 million and $4.6 million of expenses, respectively, to be reimbursed to AIR, per agreement upon separation, for consulting services with respect to strategic growth, direction, and advice. This agreement will conclude at year end.

Interest Expense

For the three and nine months ended September 30, 2022, compared to the same periods in 2021, interest expense decreased by $3.0 million, or 23.4%, and increased by $27.9 million, or 73.4%, respectively. The quarterly decrease of $3.0 million was due primarily to repayment and refinancing activity. The year to date increase of $27.9 million was due primarily to spread maintenance costs related to prepayment of the Notes Payable to AIR and other debt, the refinancing of certain property debt, and the payoff of a construction loan.

Mezzanine Investment Income, Net

On November 26, 2019, Aimco Predecessor made a five-year, $275.0 million mezzanine loan to the partnership owning the “Parkmerced Apartments” located in southwest San Francisco (the “Mezzanine Investment”). The loan bears interest at a 10% annual rate, accruing if not paid from property operations. Ownership of the subsidiaries that originated and hold the mezzanine loan was retained by AIR following the Separation. The Separation Agreement provides for AIR to transfer ownership of the subsidiaries that originated and hold the mezzanine loan, once required third-party consents to transfer are received. Until legal title of the subsidiaries is transferred, AIR is obligated to pass payments on the mezzanine loan to us.

As of September 30, 2022 and December 31, 2021, the total receivable, including accrued and unpaid interest, was $362.8 million and $337.8 million, respectively. During the three and nine months ended September 30, 2022, we recognized $8.4 million and $25.0 million, respectively, of income in connection with the mezzanine loan, compared to $7.6 million and $22.7 million during the three and nine months ended September 30, 2021, respectively.

The loan is subject to certain risks, including, but not limited to, those resulting from the lingering disruption due to the COVID-19 pandemic and associated response, and any similar events that might occur in the future, which may result in all or a portion of the loan not being repaid. In the event we determine that a portion of the related Mezzanine Investment is not recoverable, we will recognize an impairment.

Realized and Unrealized Gains (Losses) on Interest Rate Options

We recorded unrealized gains of $7.5 million and $38.3 million, respectively, during the three and nine months ended September 30, 2022, compared to unrealized gains of $2.2 million and $10.6 million during the three and nine months ended September 30, 2021, respectively. In addition, we recorded realized gains of $1.7 million and $9.7 million during the three and nine months ended September 30, 2022.

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Realized and Unrealized Gains (Losses) on Equity Investments

In June 2022, 22% of our original investment in IQHQ was redeemed for $16.5 million and we recognized a realized gain of $5.7 million. Our remaining investment in IQHQ with a cost basis of $39.2 million was valued at an estimated fair market value of $59.7 million, and a $20.5 million unrealized gain was recognized.at the same per share value as the cash redemption.

We measure our investments in property technology funds at NAV as a practical expedient. As a result of changes in NAV, we recorded unrealized losses of $2.2 million and $6.0 million, respectively, during the three and nine months ended September 30, 2022, compared to unrealized gains of $1.2 million and $2.1 million during the three and nine months ended September 30, 2021.

Gains on Dispositions of Real Estate

In July and August 2022, we sold our Cedar Rim and 2900 on First properties located in Seattle, Washington, for a total gross sales price of $122.0 million and recognized gains from the sales of $75.5 million.

In May 2022, we sold our Pathfinder Village property located in Fremont, California, for a gross sales price of $127.0 million and recognized a gain from the sale of $94.6 million.

Lease Modification Income

In June 2022, we as lessee and AIR as lessor, entered into a lease termination agreement pursuant to which AIR paid us a termination payment on September 1, 2022. Upon receipt of this payment, the leases with respect to four properties were terminated, and we relinquished control of the associated leasehold improvements and underlying land of these four properties. The total lease modification income recognized for the nine months ended September 30, 2022 was $207.0 million.

Other Income (Expense), Net

Other income (expense), net, includes costs associated with our risk management activities, partnership administration expenses, valuation changes associated with equity investments, fee income, and certain non-recurring items. Other income (expense), net, for the three months ended September 30, 2022 decreased by $0.8 million, or 100.0%, compared to the three months ended September 30, 2021. Other income (expense), net, for the nine months ended September 30, 2022, decreased by $4.7 million, or 100.0% compared to 2021.

Income Tax Benefit (Expense)

Certain aspects of our operations, including our development and redevelopment activities, are conducted through taxable REIT subsidiaries, or TRS entities. Additionally, our TRS entities hold investments in one of our apartment communities and 1001 Brickell Bay Drive.

Our income tax benefit calculated in accordance with GAAP includes income taxes associated with the income or loss of our TRS entities. Income taxes, as well as changes in valuation allowance and incremental deferred tax items in conjunction with intercompany asset transfers and internal restructurings (if applicable), are included in income tax benefit (expense) in our Condensed Consolidated Statements of Operations.

Consolidated GAAP income or loss subject to tax consists of pretax income or loss of our taxable entities and gains retained by the REIT. For the three and nine months ended September 30, 2022, we had consolidated net loss and income subject to tax of $75.6 million and $91.0 million, respectively. For the three and nine months ended September 30, 2021, we had consolidated net losses subject to tax of $7.9 million and $26.4 million, respectively.

For the three months ended September 30, 2022, we recognized income tax benefit of $17.6 million compared to a $2.0 million benefit during the same period in 2021. The change is primarily due to the GAAP income taxes associated with the lease modification depreciation expense recognized in the third quarter of 2022.

For the nine months ended September 30, 2022, we recognized income tax expense of $24.3 million compared to a $9.9 million benefit during the same period in 2021. The change is primarily due to the GAAP income taxes associated with the net lease modification income recognized in 2022.

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Critical Accounting Policies and Estimates

We prepare our condensed consolidated financial statements in accordance with GAAP, which requires us to make estimates and assumptions. We believe that the critical accounting policies that involve our more significant judgments and estimates used in the preparation of our condensed consolidated financial statements relate to the impairment of long-lived assets and capitalized costs.

Our critical accounting policies are described in more detail in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, of Aimco’s and Aimco Operating Partnership’s combined Annual Report on Form 10-K for the year ended December 31, 2021. There have been no significant changes in our critical accounting policies from those reported in our Form 10-K and we believe that the related judgments and assessments have been consistently applied and produce financial information that fairly depicts the financial condition, results of operations, and cash flows for all periods presented.

Non-GAAP Measures

We use EBITDAre and Adjusted EBITDAre in managing our business and in evaluating our financial condition and operating performance. These key financial indicators are non-GAAP measures and are defined and described below. We provide reconciliations of the non-GAAP financial measures to the most comparable financial measure computed in accordance with GAAP.

Earnings Before Interest Expense, Income Taxes, Depreciation and Amortization for Real Estate ("EBITDAre")

EBITDAre and Adjusted EBITDAre are non-GAAP measures, which we believe are useful to investors, creditors, and rating agencies as a supplemental measure of our ability to incur and service debt because they are recognized measures of performance by the real estate industry and allow for comparison of our credit strength to different companies. EBITDAre and Adjusted EBITDAre should not be considered alternatives to net income (loss) as determined in accordance with GAAP as indicators of liquidity. There can be no assurance that our method of calculating EBITDAre and Adjusted EBITDAre is comparable with that of other real estate investment trusts. Nareit defines EBITDAre as net income computed in accordance with GAAP, before interest expense, income taxes, depreciation, and amortization expense, further adjusted for:

EBITDAre is defined by Nareit and provides for an additional performance measure independent of capital structure for greater comparability between real estate investment trusts. We define Adjusted EBITDAre as EBITDAre adjusted to exclude the effect of net income attributable to noncontrolling interests in consolidated real estate partnerships and EBITDAre adjustments attributable to noncontrolling interests, and unrealized gain on interest rate options, which we believe allow investors to compare a measure of our earnings before the effects of our capital structure and indebtedness with that of other companies in the real estate industry. Additionally, we exclude interest income recognized on our Mezzanine Investment that was accrued but not paid.

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The reconciliation of net income to EBITDAre and Adjusted EBITDAre for the three and nine months ended September 30, 2022 and 2021, is as follows (in thousands):

		Three Months Ended September 30,								Nine Months Ended September 30,
		2022				2021				2022				2021
Net income (loss)		$	34,173			$	(4,846	)		$	297,496			$	(3,798	)
Adjustments:
Interest expense			9,719				12,680				65,865				37,995
Income tax (benefit) expense			(17,563	)			(2,021	)			24,338				(9,881	)
Gains on dispositions of real estate			(75,539	)			—				(170,004	)			—
Lease modification income			(1,577	)			—				(206,963	)			—
Depreciation and amortization			85,438				21,709				143,420				63,065
Adjustment related to EBITDAre of unconsolidated partnerships			253				225				768				655
EBITDAre		$	34,904			$	27,747			$	154,920			$	88,036
Net (income) loss attributable to redeemable noncontrolling    interests in consolidated real estate partnerships			(2,907	)			(127	)			(5,446	)			(41	)
Net (income) loss attributable to noncontrolling interests    in consolidated real estate partnerships			(240	)			(296	)			(585	)			(862	)
EBITDAre adjustments attributable to noncontrolling interests			(93	)			177				(325	)			(54	)
Mezzanine investment income, net (1)			(8,423	)			(7,636	)			(24,990	)			(22,654	)
Realized and unrealized (gains) losses on interest rate options			(9,209	)			(2,231	)			(48,005	)			(10,608	)
Unrealized (gains) losses on IQHQ investment			—				—				(20,501	)			—
Adjusted EBITDAre		$	14,032			$	17,634			$	55,068			$	53,817
(1) Includes the portion of accrued and unpaid income recognized during the year

 

Liquidity and Capital Resources

Liquidity

Liquidity is the ability to meet present and future financial obligations. Our primary sources of liquidity are cash flows from operations and borrowing capacity under our loan agreements.

As of September 30, 2022, our available liquidity was $375.4 million, which consisted of:

We have commitments for, and expect to spend, approximately $152.1 million on development and redevelopment projects underway, with $211.2 million undrawn on our construction loans as of September 30, 2022. The initial allocation to our Edgewater joint venture and DC joint ventures have remaining unfunded commitments of $14.2 million. We also have unfunded commitments in the amount of $2.7 million related to four investments in entities that develop technology for the real estate industry. Our principal uses for liquidity include normal operating activities, payments of principal and interest on outstanding debt, capital expenditures, and future investments. Additionally, our third-party property managers may enter into commitments on our behalf to purchase goods and services in connection with the operation of our apartment communities and our office building. Those commitments generally have terms of one year or less and reflect expenditure levels comparable to historical levels.

We believe, based on the information available at this time, that we have sufficient cash on hand and access to additional sources of liquidity to meet our operational needs for the next twelve months.

In the event that our cash and cash equivalents, revolving secured credit facility, and cash provided by operating activities are not sufficient to cover our liquidity needs, we have the means to generate additional liquidity, such as from additional property financing activity and proceeds from apartment community sales. We expect to meet our long-term liquidity requirements, including debt maturities, development and redevelopment spending, and future investment activity, primarily through property

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financing activity, cash generated from operations, and the recycling of our equity. Our revolving secured credit facility matures in December 2023, prior to consideration of its two one-year extension options.

Leverage and Capital Resources

The availability and cost of credit and its related effect on the overall economy may affect our liquidity and future financing activities, both through changes in interest rates and access to financing. Any adverse changes in the lending environment could negatively affect our liquidity. We have taken steps to mitigate a portion of our repricing risk. However, if property or development financing options become unavailable, we may consider alternative sources of liquidity, such as reductions in capital spending or apartment community dispositions.

As of September 30, 2022, 81% of our outstanding debt had a fixed interest rate and 19% had a variable interest rate. The weighted-average interest rate on our non-recourse debt was 4.86%, and the average remaining term to maturity was 7.2 years. At quarter end, Aimco had interest rate cap protection in place for 100% of its variable interest rate debt. Aimco's use of interest rate caps may vary from quarter to quarter depending on lender requirements, recycling of interest rate caps between projects, and our view on forecasted interest rates.

While our primary source of leverage is property-level debt, we also have a secured $150.0 million credit facility with a syndicate of financial institutions, and construction loans. As of September 30, 2022, we had no outstanding borrowings under our revolving secured credit facility. Under our revolving secured credit facility, we have agreed to maintain a fixed charge coverage ratio of 1.25X minimum tangible net worth of $625.0 million, and maximum leverage of 60.0% as defined in the credit agreement. We are currently in compliance and expect to remain in compliance with these covenants during the next twelve months.

Changes in Cash, Cash Equivalents, and Restricted Cash

The following discussion relates to changes in consolidated cash, cash equivalents, and restricted cash due to operating, investing and financing activities, which are presented in our condensed consolidated statements of cash flows in Item 1 of this report.

Operating Activities

For the nine months ended September 30, 2022, net cash provided by operating activities was $228.3 million. Our operating cash flow is primarily affected by rental rates, occupancy levels, and operating expenses related to our portfolio of apartment communities and general and administrative costs. Cash provided by operating activities for the nine months ended September 30, 2022, increased by $206.2 million compared to the same period ended in 2021 due to timing of balance sheet position changes.

Investing Activities

For the nine months ended September 30, 2022, our net cash used in investing activities of $83.0 million consisted primarily of capital expenditures of $184.0 and $130.1 million of cash used to acquire undeveloped land parcels in Fort Lauderdale, Florida, offset by $243.1 million of proceeds received from the disposition of our properties located in Fremont, California and Seattle, Washington.

Total capital additions were $184.0 million and $134.9 million during the nine months ended September 30, 2022 and 2021, respectively, and were primarily used for construction costs on our development and redevelopment properties. We have generally funded capital additions with available cash, cash provided by operating activities, and construction loans.

We exclude the amounts of capital spending related to commercial spaces and to apartment communities sold or classified as held for sale at the end of the period from the foregoing measures. We have also excluded from these measures indirect capitalized costs, which are not yet allocated to communities with capital additions, and their related capital spending categories.

Financing Activities

For the nine months ended September 30, 2022, our net cash used in financing activities of $164.4 million consisted primarily of the $534.1 million payoff of the Notes Payable to AIR, $284.6 million to retire property debt and the $138.4 million paydown

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of construction loans, offset by $674.7 million in cash raised from the issuance of new property debt and a $102.0 million redeemable noncontrolling interest preferred equity contribution from an institutional partner.

Net cash provided by financing activities for the nine months ended September 30, 2021 was $158.6 million primarily due to $142.3 million of proceeds received from construction loans undertaken.

Future Capital Needs

We expect to fund any future acquisitions, development and redevelopment, and other capital spending principally with operating cash flows, short-term borrowings, and debt and equity financing. Our near-term business plan does not contemplate the issuance of equity. We believe, based on the information available at this time, that we have sufficient cash on hand and access to additional sources of liquidity to meet our operational needs for the next twelve months.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Our chief market risks are refunding risk, that is the availability of property debt or other cash sources to refund maturing property debt, and repricing risk, that is the possibility of increases in base interest rates and credit risk spreads. We use long-dated, fixed-rate, non-recourse property debt in order to avoid the refunding and repricing risks of short-term borrowings. We use working capital primarily to fund short-term uses. We make limited use of derivative financial instruments primarily to mitigate repricing risk, and we do not use them for trading or other speculative purposes.

As of September 30, 2022, on a consolidated basis, we had approximately $91.9 million of variable-rate property-level debt outstanding in addition to three variable rate construction loans that totaled $86.7 million. We estimate that a change in variable rates of 100 basis points with constant credit risk spreads would reduce or increase interest expense by approximately $1.8 million. This risk is mitigated by Aimco's use of interest rate caps, which as of September 30, 2022, provided protection for 100% of its variable interest rate debt. Aimco's use of interest rate caps may vary from quarter to quarter depending on lender requirements, recycling of interest rate caps between projects, and Aimco's view on forecasted interest rates.

As of September 30, 2022, we held interest rate swaps and caps with $1.7 billion notional value that provide protection through June 2025. These instruments were acquired for $15.7 million and are currently valued at $61.3 million.

ITEM 4. CONTROLS AND PROCEDURES

Aimco

Disclosure Controls and Procedures

Aimco’s management, with the participation of Aimco’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of Aimco’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this report. Based on such evaluation, Aimco’s Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of such period, Aimco’s disclosure controls and procedures were effective.

Changes in Internal Control Over Financial Reporting

There has been no change in Aimco’s internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended September 30, 2022, that has materially affected, or is reasonably likely to materially affect, Aimco’s internal control over financial reporting.

Aimco Operating Partnership

Disclosure Controls and Procedures

Aimco Operating Partnership’s management, with the participation of the Chief Executive Officer and Chief Financial Officer of both Aimco and Aimco OP GP, LLC, Aimco Operating Partnership’s general partner, has evaluated the effectiveness of Aimco Operating Partnership’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange) as of the end of the period covered by this report. Based on such evaluation, the Chief Executive Officer and Chief Financial Officer of Aimco OP GP, LLC have concluded that, as of the end of such period, Aimco Operating Partnership’s disclosure controls and procedures are effective.

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Changes in Internal Control Over Financial Reporting

There has been no change in Aimco Operating Partnership’s internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended September 30, 2022, that has materially affected, or is reasonably likely to materially affect, Aimco Operating Partnership’s internal control over financial reporting.

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PART II. OTHER INFORMATION

ITEM 1A. RISK FACTORS

As of the date of this report, there have been no material changes from the risk factors in Aimco’s and Aimco Operating Partnership’s combined Annual Report on Form 10-K for the year ended December 31, 2021, except as discussed below. We may disclose changes to such factors or disclose additional factors from time to time in our filings with the SEC.

Activist Shareholders

On September 8, 2022, Land & Buildings Capital Growth Fund, LP, nominated three individuals to stand for election as directors at the Company’s 2022 annual meeting of stockholders in opposition to the three nominees recommended by the Board. On September 30, 2022, Land & Buildings withdrew one of its nominees.

While we strive to maintain constructive, ongoing communications with all of our stockholders, and welcome their views and opinions with the goal of enhancing value for all stockholders, activist stockholders may, from time to time, engage in proxy solicitations or advance stockholder proposals, or otherwise attempt to effect changes and assert influence on the Board and management. Responding to proposals by activist stockholders may and responding to a proxy contest instituted by stockholders would, require us to incur significant legal and advisory fees, proxy solicitation expenses and administrative and associated costs and require significant time and attention by the Board and management, diverting their attention from the pursuit of our business strategy. Any perceived uncertainties as to our future direction and control, our ability to execute on our strategy, or changes to the composition of the Board or senior management team arising from proposals by activist stockholders or a proxy contest could lead to the perception of a change in the direction of our business or instability which may be exploited by our competitors, result in the loss of potential business opportunities, and make it more difficult to pursue our strategic initiatives or attract and retain qualified personnel and business partners, any of which could have an adverse effect, which may be material, on our business and operating results and could result in volatility in the trading prices of our common stock. We may choose to initiate, or may become subject to, litigation as a result of proposals by activist stockholders or proxy contests or matters relating thereto, which would serve as a further distraction to the Board and management and could require us to incur significant additional costs.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Aimco

Unregistered Sales of Equity Securities

From time to time, Aimco may issue shares of common stock in exchange for OP Units, defined under the Aimco Operating Partnership heading below. Such shares are issued based on an exchange ratio of one share for each common OP Unit. Aimco may also issue shares of common stock in exchange for limited partnership interests in consolidated real estate partnerships. During the three months ended September 30, 2022, Aimco issued approximately 26,000 shares of common stock in exchange for OP Units in these transactions. Such shares were issued in reliance on Section 4(a)(2) of the Securities Act of 1933, as amended.

Repurchases of Equity Securities

Aimco’s Board has, from time to time, authorized Aimco to repurchase shares of its outstanding common stock. As of September 30, 2022, Aimco was authorized to repurchase up to 14.9 million shares of Aimco's outstanding common stock, subject

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to certain customary limitations, which may be made from time to time in the open market or in privately negotiated transactions. This authorization has no expiration date.

During the three months ended September 30, 2022, we repurchased 73,444 shares of Aimco Class A common stock at a weighted-average price of $7.16 per share. During the nine months ended September 30, 2022, we repurchased 815,608 shares of our common stock at a weighted-average price of $6.06 per share.

Aimco Operating Partnership

Unregistered Sales of Equity Securities

Aimco Operating Partnership did not issue any unregistered OP Units during the three months ended September 30, 2022.

Repurchases of Equity Securities

Aimco Operating Partnership’s Partnership Agreement generally provides that after holding common OP Units for one year, limited partners other than Aimco have the right to redeem their common OP Units for cash or, at our election, shares of Aimco Common Stock on a one-for-one basis (subject to customary antidilution adjustments). During the three months ended September 30, 2022, approximately 26,000 common OP Units were redeemed in exchange for shares of Common Stock. During the same period, approximately 12,000 common OP Units were redeemed in exchange for cash at an average price per unit of $6.57.

Dividend and Distribution Payments

As a REIT, Aimco is required to distribute annually to holders of shares of its Common Stock at least 90.0% of its “real estate investment trust taxable income,” which, as defined by the Code and United States Department of Treasury regulations, is generally equivalent to net taxable ordinary income. Aimco’s Board determines and declares its dividends. In making a dividend determination, Aimco’s Board considers a variety of factors, including REIT distribution requirements; current market conditions; liquidity needs; and other uses of cash, such as deleveraging and accretive investment activities. On September 30, 2022, we paid a special cash dividend of $0.02 per share to shareholders of record on September 14, 2022.

 

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ITEM 6. EXHIBITS

The following exhibits are filed with this report:

EXHIBIT NO.		DESCRIPTION
3.1		Charter – Articles of Restatement (Exhibit 3.1 to Aimco’s Annual Report on Form 10-K dated February 24, 2020, is incorporated herein by this reference)
3.2		Amended and Restated Bylaws (Exhibit 3.2 to Aimco’s Current Report on Form 8-K, dated December 15, 2020, is incorporated herein by this reference)
3.3		Articles Supplementary of Apartment Investment Management Company (Exhibit 3.1 to Aimco’s Current Report on Form 8-K, dated December 15, 2020, is incorporated herein by this reference)
10.1		Amended and Restated Agreement of Limited Partnership of Aimco OP L.P., effective as of December 14, 2020 (Exhibit 10.1 to Aimco’s Current Report on Form 8-K, dated December 15, 2020, is incorporated herein by this reference)
10.2		Amendment to Master Leasing Agreement by and between Apartment Income REIT L.P. and Aimco Development Company, LLC, dated as of May 19, 2022 (Exhibit 1.1 to Aimco's Current Report on Form 8-K, dated as of May 25, 2022, is incorporated herein by this reference)
10.3		Termination of Master Lease Agreements, dated as of June 17, 2022, by and among (i) MCZ/Centrum Flamingo II, L.L.C., AIMCO 50 Rogers Street, L.L.C., AIMCO Leahy Square Apartments, LLC, and Aimco Fitzsimons 3A Lessor, LLC; (ii) Flamingo North Lessee, LLC, Prism Lessee, LLC, 707 Leahy Lessee, LLC, and Fremont Lessee LLC; (iii) Aimco OP L.P.; and (iv) Apartment Income REIT, L.P. (Exhibit 1.1 to Aimco's Current Report on Form 8-K, dated June 14, 2022, is incorporated herein by this reference)
10.4		Amendment to Mezzanine Note Agreement and Notes, dated as of June 17, 2022, by and among Aimco JO Intermediate Holdings, LLC, Apartment Income REIT, L.P. (f/k/a AIMCO Properties, L.P.) and AIR/Bethesda Holdings, Inc. (f/k/a AIMCO/Bethesda Holdings, Inc.) (Exhibit 1.2 to Aimco's Current Report on Form 8-K, dated June 14, 2022, is incorporated herein by this reference)
10.5		Amendment to Master Leasing Agreement by and between Apartment Income REIT, L.P. and Aimco Development Company, LLC, dated as of June 14, 2022, (Exhibit 1.3 to Aimco's Current Report on Form 8-K, dated June 14, 2022, is incorporated herein by this reference)
31.1		Certification of Chief Executive Officer pursuant to Securities Exchange Act Rules 13a-14(a)/15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 – Aimco
31.2		Certification of Chief Financial Officer pursuant to Securities Exchange Act Rules 13a-14(a)/15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 – Aimco
31.3		Certification of Chief Executive Officer pursuant to Securities Exchange Act Rules 13a-14(a)/15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 – Aimco Operating Partnership
31.4		Certification of Chief Financial Officer pursuant to Securities Exchange Act Rules 13a-14(a)/15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 – Aimco Operating Partnership
32.1		Certifications of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 – Aimco
32.2		Certifications of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 – Aimco Operating Partnership

 

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EXHIBIT NO.		DESCRIPTION
101		The following materials from Aimco’s and Aimco Operating Partnership’s combined Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2022, formatted in iXBRL (Inline Extensible Business Reporting Language): (i) condensed consolidated balance sheets; (ii) condensed consolidated statements of operations; (iii) condensed consolidated statements of equity and partners’ capital; (iv) condensed consolidated statements of cash flows; and (v) notes to condensed consolidated financial statements.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document).

 

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

	APARTMENT INVESTMENT AND MANAGEMENT COMPANY
	By:	/s/ H. Lynn C. Stanfield
		H. Lynn C. Stanfield
		Executive Vice President and Chief Financial Officer

 

	AIMCO OP L.P.
	By:	Aimco OP GP, LLC, its General Partner
	By:	/s/ H. Lynn C. Stanfield
		H. Lynn C. Stanfield
		Executive Vice President and Chief Financial Officer

 

Date: November 7, 2022

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