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0000803649false00008036492024-05-012024-05-010000803649us-gaap:CommonClassAMember2024-05-012024-05-010000803649us-gaap:SeriesDPreferredStockMember2024-05-012024-05-01

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549

FORM 8-K

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

Date of report (Date of earliest event reported): May 1, 2024

EQUITY COMMONWEALTH
(Exact name of registrant as specified in its charter)

Maryland
(State or other jurisdiction of incorporation)
1-9317 04-6558834
(Commission File Number) (IRS Employer Identification No.)
Two North Riverside Plaza, Suite 2000, Chicago, IL

60606
(Address of principal executive offices) (Zip Code)
(312) 646-2800
(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Exchange Act:
Title Of Each Class Trading Symbol Name of Each Exchange On Which Registered
Common Shares of Beneficial Interest EQC New York Stock Exchange
6.50% Series D Cumulative Convertible Preferred Shares of Beneficial Interest EQCpD New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
 
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. o On May 1, 2024, Equity Commonwealth, or the Company, issued a press release setting forth the Company’s results of operations and financial condition for the quarter ended March 31, 2024, and also provided certain supplemental operating and financial information for the quarter ended March 31, 2024.




Item 2.02. Results of Operations and Financial Condition.
Copies of the Company’s press release and supplemental operating and financial information are furnished as Exhibits 99.1 and 99.2 hereto, respectively.
Item 9.01.  Financial Statements and Exhibits.
(d)  Exhibits
99.1
99.2
104 The cover page from this Current Report on form 8-K, formatted in Inline XBRL.

2



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 hereunto duly authorized.
EQUITY COMMONWEALTH
By: /s/ William H. Griffiths
Name: William H. Griffiths
Title: Executive Vice President, Chief
Financial Officer and Treasurer
Date: May 1, 2024


EX-99.1 2 eqc33124ex991.htm EX-99.1 Document
Exhibit 99.1
image1.jpg
Two North Riverside Plaza, Suite 2000, Chicago, Illinois 60606

Equity Commonwealth Reports First Quarter 2024 Results
Chicago – May 1, 2024 - Equity Commonwealth (NYSE: EQC) today reported financial results for the quarter ended March 31, 2024.

Financial results for the quarter ended March 31, 2024
Net income attributable to common shareholders was $23.4 million, or $0.22 per diluted share, for the quarter ended March 31, 2024. This compares to net income attributable to common shareholders of $20.7 million, or $0.19 per diluted share, for the quarter ended March 31, 2023. The increase in net income was primarily due to an increase in interest income from higher average interest rates and a decrease in income tax expense.

Funds from Operations, or FFO, as defined by the National Association of Real Estate Investment Trusts, for the quarter ended March 31, 2024, were $27.8 million, or $0.26 per diluted share. This compares to FFO for the quarter ended March 31, 2023 of $25.1 million, or $0.22 per diluted share. The following items impacted FFO for the quarter ended March 31, 2024, compared to the corresponding 2023 period:
•$0.01 per diluted share increase in interest and other income, net; and
•$0.01 per diluted share decrease in income tax expense.

Normalized FFO was $27.6 million, or $0.25 per diluted share, for the quarter ended March 31, 2024. This compares to Normalized FFO for the quarter ended March 31, 2023 of $25.3 million, or $0.23 per diluted share. The following items impacted Normalized FFO for the quarter ended March 31, 2024, compared to the corresponding 2023 period:
•$0.01 per diluted share increase in interest and other income, net; and
•$0.01 per diluted share decrease in income tax expense.

Normalized FFO begins with FFO and eliminates certain items that, by their nature, are not comparable from period to period, non-cash items, and items that obscure the company’s operating performance. Definitions of FFO, Normalized FFO and reconciliations to net income, determined in accordance with U.S. generally accepted accounting principles, or GAAP, are included at the end of this press release.

As of March 31, 2024, the company’s cash and cash equivalents balance was $2.2 billion.

Same property results for the quarter ended March 31, 2024
The company’s same property portfolio at the end of the quarter consisted of 4 properties totaling 1.5 million square feet. Operating results were as follows:
•The same property portfolio was 75.4% leased as of March 31, 2024, compared to 81.2% as of December 31, 2023, and 81.6% as of March 31, 2023.
•The same property portfolio commenced occupancy was 74.6% as of March 31, 2024, compared to 80.0% as of December 31, 2023, and 77.0% as of March 31, 2023.
•Same property NOI increased 4.3% when compared to the same period in 2023, primarily due to a decrease in pre-leasing demolition costs and an increase in lease termination fees, partially offset by a decrease in average commenced occupancy.
•Same property cash NOI decreased 6.9% when compared to the same period in 2023, primarily due to a decrease in average commenced occupancy, partially offset by a decrease in pre-leasing demolition costs.
1

•The company entered into leases for approximately 18,000 square feet, including renewal leases for approximately 15,000 square feet and new leases for approximately 3,000 square feet.
•The GAAP rental rate on new and renewal leases was 0.5% lower compared to the prior GAAP rental rate for the same space.
•The cash rental rate on new and renewal leases was 2.8% lower compared to the prior cash rental rate for the same space.

The definitions and reconciliations of same property NOI and same property cash NOI to net income, determined in accordance with GAAP, are included at the end of this press release. The same property portfolio at the end of the quarter included properties continuously owned from January 1, 2023 through March 31, 2024.

Business update
Since taking responsibility for the company in 2014, the EQC team has remained focused in its efforts and executed a disciplined strategy. We have:
•Completed $7.6 billion of dispositions, including the sale of 164 properties totaling 44 million square feet and three land parcels,
•Distributed $1.8 billion, or $14.75 per Common Share, to our common shareholders,
•Repurchased $652 million of our Common Shares at a weighted average, dividend adjusted price of $17.63 per share,
•Repaid debt and preferred equity of $3.3 billion, and
•Generated a cash balance of $2.2 billion, or $19.95 per share.

Throughout this time, one of our guiding principles has been to be responsive to evolving market conditions. For the first six years, following this principle was relatively straightforward – valuations were at or near all-time highs, and we concluded that it was in shareholders’ best interests to sell assets. We sold $7.6 billion of assets between 2015 and early 2020. When the Covid-19 pandemic hit, office values plummeted. We have also evaluated numerous investment opportunities, seeking to acquire a business with strong fundamentals and a compelling risk-reward profile that would create long-term value for our shareholders. To date, we have not found such an opportunity.

Today, we are continuing our efforts to maximize shareholder value. We remain focused on opportunities in our pipeline where we can create long-term value for our shareholders, while concurrently taking steps to facilitate the potential wind down of our business. Before the end of this year, we expect to either announce a transaction or move forward with a plan to wind down our business.

Earnings conference call & supplemental operating and financial information
Equity Commonwealth will host a conference call to discuss first quarter results on Thursday, May 2, 2024, at 9:00 A.M. CT. The conference call will be available via live audio webcast on the Investor Relations section of the company’s website (www.eqcre.com). A replay of the audio webcast will also be available following the call.

A copy of EQC’s First Quarter 2024 Supplemental Operating and Financial Information is available in the Investor Relations section of EQC’s website at www.eqcre.com.

About Equity Commonwealth
Equity Commonwealth (NYSE: EQC) is a Chicago based, internally managed and self-advised real estate investment trust (REIT) with commercial office properties in the United States. EQC’s portfolio is comprised of four properties totaling 1.5 million square feet.

Regulation FD Disclosures
We use any of the following to comply with our disclosure obligations under Regulation FD: press releases, SEC filings, public conference calls, or our website. We routinely post important information on our website at www.eqcre.com, including information that may be deemed to be material. We encourage investors and others interested in the company to monitor these distribution channels for material disclosures.

2

Forward-Looking Statements
Some of the statements contained in this press release constitute forward-looking statements within the meaning of the federal securities laws. Any forward-looking statements contained in this press release are intended to be made pursuant to the safe harbor provisions of Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. You can identify forward-looking statements by the use of forward-looking terminology, including but not limited to, “may,” “will,” “should,” “could,” “would,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” or “potential” or the negative of these words and phrases or similar words or phrases which are predictions of or indicate future events or trends and which do not relate solely to historical matters. You can also identify forward-looking statements by discussions of strategy, plans or intentions.

The forward-looking statements contained in this press release reflect our current views about future events and are subject to numerous known and unknown risks, uncertainties, assumptions and changes in circumstances that may cause our actual results to differ significantly from those expressed in any forward-looking statement. We do not guarantee that the transactions and events described will happen as described (or that they will happen at all). We disclaim any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, of new information, data or methods, future events or other changes. For a further discussion of these and other factors that could cause our future results to differ materially from any forward-looking statements, see the section entitled “Risk Factors” in our most recent Annual Report on Form 10-K and subsequent quarterly reports on Form 10-Q.


Contact:
Bill Griffiths
(312) 646-2801
ir@eqcre.com













3
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited, amounts in thousands, except share data)

March 31, 2024 December 31, 2023
ASSETS
Real estate properties:
Land $ 44,060  $ 44,060 
Buildings and improvements 371,550  367,827 
415,610  411,887 
Accumulated depreciation (180,266) (180,535)
235,344  231,352 
Cash and cash equivalents 2,170,834  2,160,535 
Rents receivable 16,593  15,737 
Other assets, net 16,915  17,417 
Total assets $ 2,439,686  $ 2,425,041 
LIABILITIES AND EQUITY
Accounts payable, accrued expenses and other $ 20,833  $ 27,298 
Rent collected in advance 2,166  1,990 
Distributions payable 3,359  5,640 
Total liabilities $ 26,358  $ 34,928 
Shareholders’ equity:
Preferred shares of beneficial interest, $0.01 par value: 50,000,000 shares authorized;
Series D preferred shares; 6.50% cumulative convertible; 4,915,196 shares issued and outstanding, aggregate liquidation preference of $122,880 $ 119,263  $ 119,263 
Common shares of beneficial interest, $0.01 par value: 350,000,000 shares authorized; 107,223,284 and 106,847,438 shares issued and outstanding, respectively
 1,072  1,068 
Additional paid in capital 3,935,501  3,935,873 
Cumulative net income 3,952,384  3,926,979 
Cumulative common distributions (4,864,195) (4,864,440)
Cumulative preferred distributions (735,673) (733,676)
Total shareholders’ equity 2,408,352  2,385,067 
Noncontrolling interest 4,976  5,046 
Total equity $ 2,413,328  $ 2,390,113 
Total liabilities and equity $ 2,439,686  $ 2,425,041 

4
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, amounts in thousands, except per share data)


Three Months Ended
March 31,
2024 2023
Revenues:
Rental revenue $ 13,893  $ 14,226 
Other revenue (1)
 1,297  1,350 
Total revenues $ 15,190  $ 15,576 
Expenses:
Operating expenses $ 6,534  $ 7,256 
Depreciation and amortization 4,357  4,310 
General and administrative 8,323  8,555 
Total expenses $ 19,214  $ 20,121 
Interest and other income, net 29,512  28,376 
Income before income taxes 25,488  23,831 
Income tax expense (30) (1,080)
Net income $ 25,458  $ 22,751 
Net income attributable to noncontrolling interest (53) (66)
Net income attributable to Equity Commonwealth $ 25,405  $ 22,685 
Preferred distributions (1,997) (1,997)
Net income attributable to Equity Commonwealth common shareholders $ 23,408  $ 20,688 
Weighted average common shares outstanding — basic (2)
 107,216  109,720 
Weighted average common shares outstanding — diluted (2)(3)
 108,224  111,300 
Earnings per common share attributable to Equity Commonwealth common shareholders:
Basic $ 0.22  $ 0.19 
Diluted $ 0.22  $ 0.19 
(1) Other revenue is primarily comprised of parking revenue that does not represent a component of a lease.
(2) Weighted average common shares outstanding for the three months ended March 31, 2024 and 2023 includes 129 and 113 unvested, earned RSUs, respectively.
(3)
As of March 31, 2024, we had 4,915 series D preferred shares outstanding. The series D preferred shares were convertible into 4,032 common shares as of March 31, 2024 and 2023. The series D preferred shares are anti-dilutive for GAAP EPS for all periods presented.

5
CALCULATION OF FUNDS FROM OPERATIONS (FFO) AND NORMALIZED FFO
(Unaudited, amounts in thousands, except per share data)

Three Months Ended
March 31,
2024 2023
Calculation of FFO
Net income $ 25,458  $ 22,751 
Real estate depreciation and amortization 4,346  4,299 
FFO attributable to Equity Commonwealth 29,804  27,050 
Preferred distributions (1,997) (1,997)
FFO attributable to EQC common shareholders and unitholders $ 27,807  $ 25,053 
Calculation of Normalized FFO
FFO attributable to EQC common shareholders and unitholders $ 27,807  $ 25,053 
Straight-line rent adjustments (223) 279 
Normalized FFO attributable to EQC common shareholders and unitholders
 $ 27,584  $ 25,332 
Weighted average common shares and units outstanding — basic (1)
 107,439  110,044 
Weighted average common shares and units outstanding — diluted (1)
 108,447  111,624 
FFO attributable to EQC common shareholders and unitholders per share and unit — basic
 $ 0.26  $ 0.23 
FFO attributable to EQC common shareholders and unitholders per share and unit — diluted
 $ 0.26  $ 0.22 
Normalized FFO attributable to EQC common shareholders and unitholders per share and unit — basic
 $ 0.26  $ 0.23 
Normalized FFO attributable to EQC common shareholders and unitholders per share and unit — diluted
 $ 0.25  $ 0.23 
(1)
Our calculations of FFO and Normalized FFO attributable to EQC common shareholders and unitholders per share and unit - basic for the three months ended March 31, 2024 and 2023 include 223 and 324 LTIP/Operating Partnership Units, respectively, that are excluded from the calculation of basic earnings per common share attributable to EQC common shareholders (only).




6

We compute FFO in accordance with standards established by Nareit. Nareit defines FFO as net income (loss), calculated in accordance with GAAP, excluding real estate depreciation and amortization, gains (or losses) from sales of depreciable property, impairment of depreciable real estate and our portion of these items related to equity investees and noncontrolling interests.  Our calculation of Normalized FFO differs from Nareit’s definition of FFO because we exclude certain items that we view as nonrecurring or impacting comparability from period to period.  FFO and Normalized FFO are supplemental non-GAAP financial measures. We consider FFO and Normalized FFO to be appropriate measures of operating performance for a REIT, along with net income (loss), net income (loss) attributable to EQC common shareholders and cash flow from operating activities.
We believe that FFO and Normalized FFO provide useful information to investors because by excluding the effects of certain historical amounts, such as depreciation expense, FFO and Normalized FFO may facilitate a comparison of our operating performance between periods and with other REITs.  FFO and Normalized FFO do not represent cash generated by operating activities in accordance with GAAP and should not be considered as alternatives to net income (loss), net income (loss) attributable to EQC common shareholders or cash flow from operating activities, determined in accordance with GAAP, or as indicators of our financial performance or liquidity, nor are these measures necessarily indicative of sufficient cash flow to fund all of our needs.  These measures should be considered in conjunction with net income (loss), net income (loss) attributable to EQC common shareholders and cash flow from operating activities as presented in our condensed consolidated statements of operations and condensed consolidated statements of cash flows.  Other REITs and real estate companies may calculate FFO and Normalized FFO differently than we do.



7
CALCULATION OF SAME PROPERTY NET OPERATING INCOME (NOI) AND SAME PROPERTY CASH BASIS NOI
(Unaudited, amounts in thousands)

For the Three Months Ended
3/31/2024 12/31/2023 9/30/2023 6/30/2023 3/31/2023
Calculation of Same Property NOI and Same Property Cash Basis NOI:
Rental revenue $ 13,893  $ 13,824  $ 13,928  $ 13,358  $ 14,226 
Other revenue (1)
 1,297  1,322  1,284  1,232  1,350 
Operating expenses (6,534) (6,542) (6,722) (6,942) (7,256)
NOI $ 8,656  $ 8,604  $ 8,490  $ 7,648  $ 8,320 
Straight-line rent adjustments (223) (538) (107) 273  279 
Lease termination fees (616) (630) (173) (33) (177)
Cash Basis NOI $ 7,817  $ 7,436  $ 8,210  $ 7,888  $ 8,422 
Cash Basis NOI from non-same properties (2)
 16  7  (5) (4) (4)
Same Property Cash Basis NOI $ 7,833  $ 7,443  $ 8,205  $ 7,884  $ 8,418 
Non-cash rental income and lease termination fees from same properties 839  1,168  280  (240) (102)
Same Property NOI $ 8,672  $ 8,611  $ 8,485  $ 7,644  $ 8,316 
Reconciliation of Same Property NOI to GAAP Net Income:
Same Property NOI $ 8,672  $ 8,611  $ 8,485  $ 7,644  $ 8,316 
Non-cash rental income and lease termination fees from same properties (839) (1,168) (280) 240  102 
Same Property Cash Basis NOI $ 7,833  $ 7,443  $ 8,205  $ 7,884  $ 8,418 
Cash Basis NOI from non-same properties (2)
 (16) (7) 5  4  4 
Cash Basis NOI $ 7,817  $ 7,436  $ 8,210  $ 7,888  $ 8,422 
Straight-line rent adjustments 223  538  107  (273) (279)
Lease termination fees 616  630  173  33  177 
NOI $ 8,656  $ 8,604  $ 8,490  $ 7,648  $ 8,320 
Depreciation and amortization (4,357) (4,184) (4,436) (4,514) (4,310)
General and administrative (8,323) (7,504) (7,061) (13,854) (8,555)
Interest and other income, net 29,512  29,670  29,269  27,352  28,376 
Income before income taxes $ 25,488  $ 26,586  $ 26,262  $ 16,632  $ 23,831 
Income tax (expense) benefit (30) 40  (30) (796) (1,080)
Net income $ 25,458  $ 26,626  $ 26,232  $ 15,836  $ 22,751 
(1) Other revenue is primarily comprised of parking revenue that does not represent a component of a lease.
(2) Cash Basis NOI from non-same properties for all periods presented includes the operations of disposed properties.


8

NOI is income from our real estate including lease termination fees received from tenants less our property operating expenses. NOI excludes amortization of capitalized tenant improvement costs and leasing commissions and corporate level expenses. Cash Basis NOI is NOI excluding the effects of straight-line rent adjustments, lease value amortization and lease termination fees. The year-to-date same property versions of these measures include the results of properties continuously owned from January 1, 2023 through March 31, 2024.Properties classified as held for sale within our condensed consolidated balance sheets are excluded from the same property versions of these measures.
We consider these supplemental non-GAAP financial measures to be appropriate supplemental measures to net income (loss) because they may help to understand the operations of our properties. We use these measures internally to evaluate property level performance, and we believe that they provide useful information to investors regarding our results of operations because they reflect only those income and expense items that are incurred at the property level and may facilitate comparisons of our operating performance between periods and with other REITs. Cash Basis NOI is among the factors considered with respect to acquisition, disposition and financing decisions. These measures do not represent cash generated by operating activities in accordance with GAAP and should not be considered as an alternative to net income (loss), net income (loss) attributable to Equity Commonwealth common shareholders or cash flow from operating activities, determined in accordance with GAAP, or as indicators of our financial performance or liquidity, nor are these measures necessarily indicative of sufficient cash flow to fund all of our needs. These measures should be considered in conjunction with net income (loss), net income (loss) attributable to EQC common shareholders and cash flow from operating activities as presented in our condensed consolidated statements of operations and condensed consolidated statements of cash flows. Other REITs and real estate companies may calculate these measures differently than we do.

9
EX-99.2 3 eqc33124ex992.htm EX-99.2 Document
Exhibit 99.2



eqcsitebannerfebruary2020.jpg

Equity Commonwealth
Supplemental Operating
and Financial Information

First Quarter 2024

image2.jpg



Corporate Headquarters Investor Relations
Two North Riverside Plaza (312) 646-2801
Suite 2000 ir@eqcre.com
Chicago, IL 60606 www.eqcre.com
(312) 646-2800



TABLE OF CONTENTS
Corporate Information
Company Profile and Investor Information
Financial Information
Key Financial Data
Condensed Consolidated Balance Sheets
Additional Balance Sheet Information
Condensed Consolidated Statements of Operations
Calculation of Same Property Net Operating Income (NOI) and Same Property Cash Basis NOI
Same Property Results of Operations
Calculation of EBITDA, EBITDAre, and Adjusted EBITDAre
Calculation of Funds from Operations (FFO) and Normalized FFO
Portfolio Information
Property Detail
Leasing Summary
Capital Summary - Expenditures & Same Property Leasing Commitments
Tenants Representing 2.5% or More of Annualized Rental Revenue
Same Property Lease Expiration Schedule
Additional Support
Common & Potential Common Shares
Definitions
Forward-Looking Statements
Some of the statements contained in this presentation constitute forward-looking statements within the meaning of the federal securities laws including, but not limited to, statements pertaining to our capital resources, portfolio performance, lease expirations schedules, results of operations or anticipated market conditions, including statements regarding the overall impact of COVID-19 and other external factors on the foregoing. Any forward-looking statements contained in this presentation are intended to be made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. You can identify forward-looking statements by the use of forward-looking terminology, including but not limited to, “may,” “will,” “should,” “could,” “would,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” or “potential” or the negative of these words and phrases or similar words or phrases which are predictions of or indicate future events or trends and which do not relate solely to historical matters. You can also identify forward-looking statements by discussions of strategy, plans or intentions.
Any forward-looking statements contained in this presentation reflect our current views about future events and are subject to numerous known and unknown risks, uncertainties, assumptions and changes in circumstances that may cause our actual results to differ significantly from those expressed in any forward-looking statement. We do not guarantee that the transactions and events described will happen as described (or that they will happen at all). We disclaim any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, of new information, data or methods, future events or other changes. For a further discussion of these and other factors that could cause our future results to differ materially from any forward-looking statements, see the section entitled “Risk Factors” in our most recent Annual Report on Form 10-K and subsequent quarterly reports on Form 10-Q.
Regulation FD Disclosures
We use any of the following to comply with our disclosure obligations under Regulation FD: press releases, SEC filings, public conference calls, or our website. We routinely post important information on our website at www.eqcre.com, including information that may be deemed to be material. We encourage investors and others interested in the company to monitor these distribution channels for material disclosures.

2

COMPANY PROFILE AND INVESTOR INFORMATION
Equity Commonwealth (NYSE: EQC) is a Chicago based, internally managed and self-advised real estate investment trust (REIT) with commercial office properties in the United States.
Same Property Statistics
No. of
 Properties Sq. Feet % Leased % Commenced
4 1,520,944 75.4% 74.6%
 NYSE Trading Symbols
 Common Stock: EQC
 Preferred Stock Series D: EQCpD
Board of Trustees
David Helfand (Chair) Peter Linneman (Lead Independent Trustee) James A. Star
Ellen-Blair Chube Mary Jane Robertson
Martin L. Edelman Gerald A. Spector
Senior Management
David A. Helfand David S. Weinberg
President and Chief Executive Officer Executive Vice President and
Chief Operating Officer
William H. Griffiths Orrin S. Shifrin
Executive Vice President, Executive Vice President,
Chief Financial Officer and Treasurer General Counsel and Secretary
Equity Research Coverage (1)
Citigroup Nicholas Joseph (212) 816-1909 nicholas.joseph@citi.com
Green Street Advisors Daniel Ismail (949) 640-8780 dismail@greenstreetadvisors.com




Certain terms are defined in the definitions section of this document. All financial data included herein is unaudited.
(1) Any opinions, estimates or forecasts regarding EQC's performance made by these analysts do not represent opinions, forecasts or predictions of EQC or its management. EQC does not by its reference to the analysts above imply its endorsement of or concurrence with any information, conclusions or recommendations provided by any of these analysts.

3

KEY FINANCIAL DATA
(Unaudited, amounts in thousands, except per share data)
As of and for the Three Months Ended
3/31/2024 12/31/2023 9/30/2023 6/30/2023 3/31/2023
OPERATING INFORMATION
Ending property count
 4  4  4  4  4 
Ending square footage (1)
 1,521  1,521  1,521  1,521  1,507 
Percent leased
 75.4  % 81.2  % 80.8  % 82.0  % 81.6  %
Percent commenced
 74.6  % 80.0  % 79.9  % 78.2  % 77.0  %
Net income attributable to EQC common shareholders
 $ 23,408  $ 24,552  $ 24,149  $ 13,787  $ 20,688 
Adjusted EBITDAre (2)
 29,845  30,770  30,698  27,103  28,141 
SAME PROPERTY OPERATING INFORMATION
Ending square footage (1)
 1,521  1,521  1,521  1,521  1,507 
Percent leased 75.4  % 81.2  % 80.8  % 82.0  % 81.6  %
Percent commenced 74.6  % 80.0  % 79.9  % 78.2  % 77.0  %
Same Property NOI (2)
 $ 8,672  $ 8,611  $ 8,485  $ 7,644  $ 8,316 
Same Property Cash Basis NOI (2)
 7,833  7,443  8,205  7,884  8,418 
Same Property NOI margin 57.1  % 56.9  % 55.8  % 52.4  % 53.4  %
Same Property Cash Basis NOI margin 54.6  % 53.3  % 55.0  % 53.2  % 53.7  %
SHARES OUTSTANDING AND PER SHARE DATA
Shares Outstanding at End of Period
Common shares outstanding
 107,223  106,847  106,712  109,730  109,702 
Dilutive restricted share units (RSUs), Operating Partnership Units, and LTIP Units (3)
 1,358  1,467  1,779  1,891  2,068 
Preferred shares outstanding (4)
 4,915  4,915  4,915  4,915  4,915 
Weighted Average Shares Outstanding - GAAP
Basic (5)
 107,216  106,905  108,931  109,839  109,720 
Diluted (5)
 108,224  108,015  110,217  111,237  111,300 
Distributions Declared Per Common Share $ —  $ —  $ —  $ —  $ 4.25 
BALANCE SHEET
Total assets $ 2,439,686  $ 2,425,041  $ 2,393,786  $ 2,421,843  $ 2,399,324 
Total liabilities 26,358  34,928  31,550  30,016  30,252 
MARKET CAPITALIZATION
Market value of preferred shares
 $ 122,880  $ 123,519  $ 122,929  $ 124,846  $ 122,831 
Market value of diluted common shares
 2,050,009  2,079,629  1,992,980  2,261,441  2,314,757 
Total market capitalization $ 2,172,889  $ 2,203,148  $ 2,115,909  $ 2,386,287  $ 2,437,588 
(1) Changes in total square footage result from remeasurement.
(2) Non-GAAP financial measures are defined and reconciled to the most directly comparable GAAP measure herein.
(3) Restricted share units (RSUs) and LTIP Units are equity awards that contain both service and market-based vesting components. Refer to the schedule of Common & Potential Common Shares for information regarding RSUs and LTIP Units and their impact on weighted average shares outstanding.
(4)
As of March 31, 2024, we had 4,915 series D preferred shares outstanding that were convertible into 4,032 common shares. The series D preferred shares are anti-dilutive for GAAP EPS for all periods presented. Refer to the schedule of Common & Potential Common Shares for information regarding the series D preferred shares and their impact on diluted weighted average shares outstanding for EPS, FFO per share and Normalized FFO per share.
(5) Refer to the schedule of Common & Potential Common Shares for information regarding the components of our weighted average common shares outstanding.

4

CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited, amounts in thousands, except share data)
March 31, 2024 December 31, 2023
ASSETS
Real estate properties:
Land $ 44,060  $ 44,060 
Buildings and improvements 371,550  367,827 
415,610  411,887 
Accumulated depreciation (180,266) (180,535)
235,344  231,352 
Cash and cash equivalents 2,170,834  2,160,535 
Rents receivable 16,593  15,737 
Other assets, net 16,915  17,417 
Total assets $ 2,439,686  $ 2,425,041 
LIABILITIES AND EQUITY
Accounts payable, accrued expenses and other $ 20,833  $ 27,298 
Rent collected in advance 2,166  1,990 
Distributions payable 3,359  5,640 
Total liabilities $ 26,358  $ 34,928 
Shareholders’ equity:
Preferred shares of beneficial interest, $0.01 par value: 50,000,000 shares authorized;
Series D preferred shares; 6.50% cumulative convertible; 4,915,196 shares issued and outstanding, aggregate liquidation preference of $122,880 $ 119,263  $ 119,263 
Common shares of beneficial interest, $0.01 par value: 350,000,000 shares authorized; 107,223,284 and 106,847,438 shares issued and outstanding, respectively
 1,072  1,068 
Additional paid in capital 3,935,501  3,935,873 
Cumulative net income 3,952,384  3,926,979 
Cumulative common distributions (4,864,195) (4,864,440)
Cumulative preferred distributions (735,673) (733,676)
Total shareholders’ equity 2,408,352  2,385,067 
Noncontrolling interest 4,976  5,046 
Total equity $ 2,413,328  $ 2,390,113 
Total liabilities and equity $ 2,439,686  $ 2,425,041 

5

ADDITIONAL BALANCE SHEET INFORMATION
(Unaudited, amounts in thousands)
March 31, 2024 December 31, 2023
Additional Balance Sheet Information
Straight-line rents receivable $ 15,218  $ 14,995 
Accounts receivable 1,375  742 
Rents receivable $ 16,593  $ 15,737 
Capitalized lease incentives, net $ 1,340  $ 1,193 
Deferred leasing costs, net 10,258  10,816 
Other 5,317  5,408 
Other assets, net $ 16,915  $ 17,417 
Accounts payable $ 2,690  $ 2,824 
Accrued taxes 5,560  9,527 
Accrued capital expenditures 5,433  2,881 
Accrued leasing costs 286  206 
Security deposits 2,341  2,356 
Other accrued liabilities 4,523  9,504 
Accounts payable, accrued expenses and other $ 20,833  $ 27,298 

6

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, amounts in thousands, except per share data)
Three Months Ended
March 31,
2024 2023
Revenues:
Rental revenue $ 13,893  $ 14,226 
Other revenue (1)
 1,297  1,350 
Total revenues $ 15,190  $ 15,576 
Expenses:
Operating expenses $ 6,534  $ 7,256 
Depreciation and amortization 4,357  4,310 
General and administrative 8,323  8,555 
Total expenses $ 19,214  $ 20,121 
Interest and other income, net 29,512  28,376 
Income before income taxes 25,488  23,831 
Income tax expense (30) (1,080)
Net income $ 25,458  $ 22,751 
Net income attributable to noncontrolling interest (53) (66)
Net income attributable to Equity Commonwealth $ 25,405  $ 22,685 
Preferred distributions
 (1,997) (1,997)
Net income attributable to Equity Commonwealth common shareholders $ 23,408  $ 20,688 
Weighted average common shares outstanding — basic (2)
 107,216  109,720 
Weighted average common shares outstanding — diluted (2)
 108,224  111,300 
Earnings per common share attributable to Equity Commonwealth common shareholders:
Basic $ 0.22  $ 0.19 
Diluted $ 0.22  $ 0.19 
(1) Other revenue is primarily comprised of parking revenue that does not represent a component of a lease.
(2) Refer to the schedule of Common & Potential Common Shares for information regarding the components of our weighted average common shares outstanding.

7

CALCULATION OF SAME PROPERTY NET OPERATING INCOME (NOI) AND SAME PROPERTY CASH BASIS NOI
(Unaudited, amounts in thousands)
For the Three Months Ended
3/31/2024 12/31/2023 9/30/2023 6/30/2023 3/31/2023
Calculation of Same Property NOI and Same Property Cash Basis NOI:
Rental revenue $ 13,893  $ 13,824  $ 13,928  $ 13,358  $ 14,226 
Other revenue (1)
 1,297  1,322  1,284  1,232  1,350 
Operating expenses (6,534) (6,542) (6,722) (6,942) (7,256)
NOI $ 8,656  $ 8,604  $ 8,490  $ 7,648  $ 8,320 
Straight-line rent adjustments (223) (538) (107) 273  279 
Lease termination fees (616) (630) (173) (33) (177)
Cash Basis NOI $ 7,817  $ 7,436  $ 8,210  $ 7,888  $ 8,422 
Cash Basis NOI from non-same properties (2)
 16  7  (5) (4) (4)
Same Property Cash Basis NOI $ 7,833  $ 7,443  $ 8,205  $ 7,884  $ 8,418 
Non-cash rental income and lease termination fees from same properties
 839  1,168  280  (240) (102)
Same Property NOI $ 8,672  $ 8,611  $ 8,485  $ 7,644  $ 8,316 
Reconciliation of Same Property NOI to GAAP Net Income:
Same Property NOI $ 8,672  $ 8,611  $ 8,485  $ 7,644  $ 8,316 
Non-cash rental income and lease termination fees from same properties
 (839) (1,168) (280) 240  102 
Same Property Cash Basis NOI $ 7,833  $ 7,443  $ 8,205  $ 7,884  $ 8,418 
Cash Basis NOI from non-same properties (2)
 (16) (7) 5  4  4 
Cash Basis NOI $ 7,817  $ 7,436  $ 8,210  $ 7,888  $ 8,422 
Straight-line rent adjustments 223  538  107  (273) (279)
Lease termination fees 616  630  173  33  177 
NOI $ 8,656  $ 8,604  $ 8,490  $ 7,648  $ 8,320 
Depreciation and amortization (4,357) (4,184) (4,436) (4,514) (4,310)
General and administrative (8,323) (7,504) (7,061) (13,854) (8,555)
Interest and other income, net 29,512  29,670  29,269  27,352  28,376 
Income before income taxes $ 25,488  $ 26,586  $ 26,262  $ 16,632  $ 23,831 
Income tax (expense) benefit (30) 40  (30) (796) (1,080)
Net income $ 25,458  $ 26,626  $ 26,232  $ 15,836  $ 22,751 
(1) Other revenue is primarily comprised of parking revenue that does not represent a component of a lease.
(2) Cash Basis NOI from non-same properties for all periods presented includes the operations of disposed properties.

8

SAME PROPERTY RESULTS OF OPERATIONS
(Unaudited, dollars and square feet in thousands)
As of and for the Three Months Ended March 31,
2024 2023 % Change
Properties 4  4 
Square Feet
 1,521  1,507 
% Leased 75.4  % 81.6  % (6.2) %
% Commenced 74.6  % 77.0  % (2.4) %
Rental revenue
 $ 13,054  $ 14,328  (8.9) %
Other revenue (1)
 1,297  1,343  (3.4) %
Straight-line rent adjustment
223  (279)
Lease termination fees
 616  177 
Total revenue
 15,190  15,569  (2.4) %
Operating expenses
 (6,518) (7,253) (10.1) %
NOI
 $ 8,672  $ 8,316  4.3  %
NOI Margin
 57.1  % 53.4  %
Straight-line rent adjustment
 $ (223) $ 279 
Lease termination fees
 (616) (177)
Cash Basis NOI $ 7,833  $ 8,418  (6.9) %
Cash Basis NOI Margin
 54.6  % 53.7  %
(1) Other revenue is primarily comprised of parking revenue that does not represent a component of a lease.

9

CALCULATION OF EBITDA, EBITDAre, AND ADJUSTED EBITDAre
(Unaudited, amounts in thousands)
Three Months Ended
March 31,
2024 2023
Net income $ 25,458  $ 22,751 
Income tax expense
 30  1,080 
Depreciation and amortization
 4,357  4,310 
EBITDA, EBITDAre and Adjusted EBITDAre
 $ 29,845  $ 28,141 

10

CALCULATION OF FUNDS FROM OPERATIONS (FFO) AND NORMALIZED FFO
(Unaudited, amounts in thousands, except per share data)
Three Months Ended
March 31,
2024 2023
Calculation of FFO
Net income $ 25,458  $ 22,751 
Real estate depreciation and amortization 4,346  4,299 
FFO attributable to Equity Commonwealth 29,804  27,050 
Preferred distributions (1,997) (1,997)
FFO attributable to EQC common shareholders and unitholders
 $ 27,807  $ 25,053 
Calculation of Normalized FFO
FFO attributable to EQC common shareholders and unitholders $ 27,807  $ 25,053 
Straight-line rent adjustments (223) 279 
Normalized FFO attributable to EQC common shareholders and unitholders
 $ 27,584  $ 25,332 
Weighted average common shares and units outstanding -- basic (1)
 107,439  110,044 
Weighted average common shares and units outstanding -- diluted (1)
 108,447  111,624 
FFO attributable to EQC common shareholders and unitholders per share and unit -- basic
 $ 0.26  $ 0.23 
FFO attributable to EQC common shareholders and unitholders per share and unit -- diluted
 $ 0.26  $ 0.22 
Normalized FFO attributable to EQC common shareholders and unitholders per share and unit -- basic
 $ 0.26  $ 0.23 
Normalized FFO attributable to EQC common shareholders and unitholders per share and unit -- diluted
 $ 0.25  $ 0.23 
(1)
Our calculations of FFO and Normalized FFO attributable to EQC common shareholders and unitholders per share and unit - basic for the three months ended March 31, 2024 and 2023 include 223 and 324 LTIP/Operating Partnership Units, respectively, that are excluded from the calculation of basic earnings per common share attributable to EQC common shareholders (only). Refer to the schedule of Common & Potential Common Shares for information regarding the components of our weighted average common shares and units outstanding.

11

PROPERTY DETAIL
As of March 31, 2024
(Unaudited, sorted by annualized rental revenue, dollars in thousands)

Same Property Portfolio(1)
Property City, State Type No. of Buildings Square Feet % Leased % Commenced Annualized Rental Revenue Undepreciated Book Value Net Book Value Year Acquired
1 1225 Seventeenth Street Denver, CO Office 1  708,937 91.6  % 90.8  % $ 29,594  $ 177,668  $ 111,586  2009
(17th Street Plaza)
2 Bridgepoint Square Austin, TX Office 5  440,007 57.0  % 55.9  % 9,862  104,785  47,430  1997
3 206 East 9th Street Austin, TX Office 1  175,510 69.4  % 69.4  % 8,201  56,578  42,163  2012
(Capitol Tower)
4 1250 H Street, NW Washington, D.C. Office 1  196,490 63.4  % 62.5  % 7,141  76,579  34,165  1998
Total Same Properties 8  1,520,944 75.4  % 74.6  % $ 54,798  $ 415,610  $ 235,344 
(1) Refer to the definitions section of this document for a description of our same property portfolio.


12

LEASING SUMMARY
(Unaudited, dollars and square feet in thousands, except per square foot data)
As of and for the Three Months Ended
3/31/2024 12/31/2023 9/30/2023 6/30/2023 3/31/2023
Properties
 4  4  4  4  4 
Total square feet (1)
 1,521  1,521  1,521  1,521  1,507 
Percentage leased 75.4  % 81.2  % 80.8  % 82.0  % 81.6  %
Percentage commenced 74.6  % 80.0  % 79.9  % 78.2  % 77.0  %
Total Leases
Square feet 18  32  54  68  60 
Lease term (years) 4.1  3.0  6.4  4.9  5.8 
Starting cash rent $ 49.71  $ 50.88  $ 48.17  $ 48.34  $ 61.15 
Percent change in cash rent (2)
 (2.8) % 7.9  % (1.8) % (0.7) % 3.6  %
Percent change in GAAP rent (2)
 (0.5) % 26.4  % 6.0  % 15.3  % 13.8  %
Total TI & LC per square foot (3)
 $ 58.93  $ 16.97  $ 40.57  $ 43.44  $ 64.87 
Total TI & LC per sq. ft. per year of lease term (3)
 $ 14.39  $ 5.75  $ 6.38  $ 8.92  $ 11.22 
Renewal Leases
Square feet 15  27  39  54  37 
Lease term (years) 4.0  2.6  7.0  4.7  5.3 
Starting cash rent $ 49.54  $ 52.04  $ 49.47  $ 49.63  $ 63.26 
Percent change in cash rent (2)
 0.6  % 7.9  % (1.7) % (0.7) % 4.8  %
Percent change in GAAP rent (2)
 3.2  % 26.4  % 8.8  % 15.3  % 16.8  %
Total TI & LC per square foot (3)
 $ 64.35  $ 9.46  $ 41.02  $ 25.17  $ 58.65 
Total TI & LC per sq. ft. per year of lease term (3)
 $ 15.95  $ 3.70  $ 5.84  $ 5.40  $ 11.00 
New Leases
Square feet 3  5  15  14  23 
Lease term (years) 4.4  5.2  4.6  5.7  6.5 
Starting cash rent $ 50.50  $ 44.44  $ 44.73  $ 43.34  $ 57.87 
Percent change in cash rent (2)
 (17.6) % —  (2.2) % —  1.5  %
Percent change in GAAP rent (2)
 (17.0) % —  (1.3) % —  8.9  %
Total TI & LC per square foot (3)
 $ 34.43  $ 58.68  $ 39.38  $ 114.17  $ 74.56 
Total TI & LC per sq. ft. per year of lease term (3)
 $ 7.88  $ 11.36  $ 8.50  $ 20.15  $ 11.50 
The above leasing summary is based on leases executed during the periods indicated and excludes leasing activity for assets during the quarter in which the asset was sold or classified as held for sale. Our same property leasing activity is identical to the information above for all periods presented. Refer to the definitions section of this document for a description of our same property portfolio.
(1) Changes in total square footage result from remeasurement.
(2)
Percent change in GAAP and cash rents is a comparison of current rent, including estimated tenant expense reimbursements, if any, to the rent, including actual/projected tenant expense reimbursements, if any, last received for the same space on a GAAP and cash basis, respectively. Cash rent during the reporting period is calculated before deducting any initial period free rent. Leasing in suites vacant longer than two years was excluded from the calculation.
(3) Includes tenant improvements (TI) and leasing commissions (LC).

13

CAPITAL SUMMARY
EXPENDITURES & SAME PROPERTY LEASING COMMITMENTS
(Unaudited, dollars and square feet in thousands)
CAPITAL SUMMARY Three Months Ended
EXPENDITURES 3/31/2024 12/31/2023 9/30/2023 6/30/2023 3/31/2023
Tenant improvements $ 5,752  $ 645  $ 224  $ 1,351  $ 1,757 
Leasing costs
 174  150  646  673  1,162 
Building improvements (1)
 1,855  1,495  1,438  533  195 
Total capital expenditures $ 7,781  $ 2,290  $ 2,308  $ 2,557  $ 3,114 
Average square feet during period
 1,521  1,521  1,521  1,514  1,507 
Building improvements per average total sq. ft. during period
 $ 1.22  $ 0.98  $ 0.95  $ 0.35  $ 0.13 
CAPITAL SUMMARY Three Months Ended
SAME PROPERTY LEASING COMMITMENTS March 31, 2024
New Leases Renewal Leases Total
Square feet leased during the period 3  15  18 
Total TI & LC (2)
 $ 103  $ 965  $ 1,068 
Total TI & LC per square foot (2)
 $ 34.43  $ 64.35  $ 58.93 
Weighted average lease term by square foot (years) 4.4  4.0  4.1 
Total TI & LC per square foot per year of lease term (2)
 $ 7.88  $ 15.95  $ 14.39 
(1) Tenant-funded capital expenditures are excluded.
(2) Includes tenant improvements (TI) and leasing commissions (LC).

14

TENANTS REPRESENTING 2.5% OR MORE OF ANNUALIZED RENTAL REVENUE
As of March 31, 2024
(Unaudited, square feet in thousands)

Tenant
Square Feet (1)
% of Total Sq. Ft. (1)
 % of Annualized Rental Revenue Weighted Average Remaining Lease Term
1  Salesforce.com, Inc. 66  5.8  % 5.7  % 1.7
2  KPMG, LLP 66  5.8  % 5.2  % 5.2
3  Crowdstrike, Inc. 48  4.2  % 5.2  % 5.9
4  CBRE, Inc. 41  3.6  % 3.9  % 4.0
5  Jones Lang LaSalle Americas, Inc. 42  3.7  % 3.6  % 6.3
6  RSM US LLP 32  2.8  % 3.5  % 8.2
7  SonarSource US, Inc. 28  2.4  % 3.0  % 3.4
8  Alden Torch Financial, LLC 35  3.1  % 2.9  % 2.9
9  Ballard Spahr LLP 30  2.6  % 2.6  % 1.4
10  Simply Good Foods USA, Inc 29  2.5  % 2.6  % 3.7
11  Wunderman Thompson, LLC 24  2.1  % 2.5  % 3.3
12  Shiseido Americas Corporation 21  1.8  % 2.5  % 5.6
Total 462  40.4  % 43.2  % 4.3

(1)
Square footage as of March 31, 2024 includes space subject to leases that have commenced for revenue recognition purposes in accordance with GAAP, space being fitted out for occupancy pursuant to existing leases, and space which is leased but is not occupied or is being offered for sublease by tenants.

15

SAME PROPERTY LEASE EXPIRATION SCHEDULE
As of March 31, 2024
(Unaudited, dollars and sq. ft. in thousands)
Year Number of Tenants Expiring
Leased Sq. Ft. Expiring (1)
 % of Leased Sq. Ft. Expiring Cumulative % of Leased Sq. Ft. Expiring
Annualized Rental Revenue Expiring (2)
 % of Annualized Rental Revenue Expiring Cumulative % of Annualized Rental Revenue Expiring
2024 17 119 10.4  % 10.4  % $ 5,849  10.7  % 10.7  %
2025 7 130 11.3  % 21.7  % 6,018  11.0  % 21.7  %
2026 11 69 6.0  % 27.7  % 3,241  5.9  % 27.6  %
2027 18 231 20.1  % 47.8  % 11,027  20.1  % 47.7  %
2028 11 123 10.7  % 58.5  % 5,400  9.9  % 57.6  %
2029 10 149 13.0  % 71.5  % 6,729  12.3  % 69.9  %
2030 10 159 13.9  % 85.4  % 7,664  14.0  % 83.9  %
2031 4 58 5.1  % 90.5  % 2,661  4.9  % 88.8  %
2032 1 32 2.8  % 93.3  % 1,942  3.5  % 92.3  %
2033 3 23 2.0  % 95.3  % 1,392  2.5  % 94.8  %
Thereafter 4 54 4.7  % 100.0  % 2,875  5.2  % 100.0  %
    Total 96 1,147 100.0  % $ 54,798  100.0  %
Weighted average remaining
    lease term (in years) 4.2  4.3 
(1)
Leased square footage as of March 31, 2024 includes space subject to leases that have commenced for revenue recognition purposes in accordance with GAAP, space being fitted out for occupancy pursuant to existing leases, and space which is leased but is not occupied or is being offered for sublease by tenants. The year expiring corresponds to the latest-expiring signed lease for a given suite. Thus, backfilled suites expire in the year stipulated by the new lease.
(2) Excludes the Annualized Rental Revenue of space that is leased but not commenced.

16

COMMON & POTENTIAL COMMON SHARES
(Unaudited, share amounts in thousands)
Three Months Ended
March 31,
Weighted Average Share Calculation - GAAP EPS 2024 2023
Weighted average common shares outstanding - basic (1)
 107,216  109,720 
Weighted average dilutive RSUs and maket-based LTIP Units (2)
 1,008  1,580 
Weighted average common shares outstanding - diluted (1)
 108,224  111,300 
Three Months Ended
March 31,
Weighted Average Share and Unit Calculation - FFO and Normalized FFO per share and unit 2024 2023
Weighted average EQC common shares outstanding (1)
 107,216  109,720 
Weighted average Operating Partnership Units outstanding (3)
 119  227 
Weighted average time-based LTIP Units (2)(3)
 104  97 
Weighted average common shares and units outstanding - basic (1)
 107,439  110,044 
Weighted average dilutive RSUs and market-based LTIP Units (2)
 1,008  1,580 
Weighted average common shares and units outstanding - diluted (1)
 108,447  111,624 
Rollforward of Share Count to March 31, 2024
Series D Preferred Shares (4)
EQC Common Shares (5)
Outstanding on December 31, 2023 4,915  106,847 
Operating Partnership Unit redemption —  4 
Share-based compensation grants and vesting, net (6)
 —  372 
Outstanding on March 31, 2024
 4,915  107,223 
Common shares issuable from RSUs, Operating Partnership Units, and LTIP Units as measured on March 31, 2024 (2)
 1,358 
Potential common shares as measured on March 31, 2024 (7)
 108,581 
(1)
Weighted average common shares outstanding for the three months ended March 31, 2024 and 2023 includes 129 and 113 unvested, earned RSUs, respectively.
(2)
We have granted RSUs and LTIP Units to certain trustees, employees and eligible consultants. RSUs and market-based LTIP Units contain service and market-based vesting components. Time-based LTIP Units contain service-based vesting components. Each LTIP Unit will convert automatically into an OP Unit on a one-for-one basis when the LTIP Unit becomes vested and its capital account is equalized with the per-unit capital account of the OP Units.
(3)
Our calculations of FFO and Normalized FFO attributable to EQC common shareholders and unitholders per share and unit - basic include time-based LTIP Units and OP Units that are excluded from the calculation of basic earnings per common share attributable to EQC common shareholders (only).
(4)
As of March 31, 2024, we had 4,915 series D preferred shares that were convertible into 4,032 common shares. The series D preferred shares are anti-dilutive for GAAP EPS for all periods presented. The series D preferred shares are anti-dilutive for all periods presented with respect to FFO and Normalized FFO per common share and unit.
(5) EQC common shares include unvested restricted shares.
(6) This amount is net of forfeitures and shares surrendered to satisfy statutory tax withholding obligations.
(7)
Potential common shares as measured on March 31, 2024 include unvested earned RSUs. The 4,915 series D preferred shares outstanding that were convertible into 4,032 common shares as of March 31, 2024 are excluded.
17

DEFINITIONS
Annualized Rental Revenue
Annualized Rental Revenue is annualized contractual rents from our tenants pursuant to leases which have commenced as of March 31, 2024, plus estimated recurring expense reimbursements; excludes lease value amortization, straight-line rent adjustments, abated (free) rent periods and parking revenue. We calculate annualized rental revenue by aggregating the recurring billings outlined above for the most recent month during the quarter reported, adding abated rent, and multiplying the sum by 12 to provide an estimation of near-term potentially-recurring revenues. The annualized rental revenue of disposed properties, if any, is presented for the quarter-ended preceding each disposition.
Annualized rental revenue is a forward-looking non-GAAP measure. Annualized rental revenue cannot be reconciled to a comparable GAAP measure without unreasonable efforts, primarily due to the fact that it is calculated from the billings of tenants in the most recent month at the most recent rental rates during the quarter reported, whereas historical GAAP measures include billings from a potentially different group of tenants over multiple months at potentially different rental rates.
Building Improvements
Building improvements are expenditures to replace obsolete building components or extend the useful life of existing assets. Tenant-funded capital expenditures are excluded.
Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA), EBITDAre and Adjusted EBITDAre
We calculate EBITDA as net income (loss) excluding interest expense, income tax expense and depreciation and amortization.
We calculate EBITDAre in accordance with standards established by the National Association of Real Estate Investment Trusts (Nareit). Nareit defines EBITDAre as net income (loss), calculated in accordance with GAAP, plus interest expense, plus income tax expense, plus depreciation and amortization, plus (minus) losses and gains on the disposition of depreciated property, plus impairment write-downs of depreciated property and investments in unconsolidated joint ventures, plus adjustments to reflect the entity's share of EBITDAre of unconsolidated joint ventures. Our calculation of Adjusted EBITDAre differs from our calculations of EBITDA and EBITDAre because we exclude certain items that we view as nonrecurring or impacting comparability from period to period. EBITDA, EBITDAre and Adjusted EBITDAre are supplemental non-GAAP financial measures.
We consider EBITDA, EBITDAre and Adjusted EBITDAre to be appropriate measures of our operating performance, along with net income (loss), net income (loss) attributable to EQC common shareholders, and cash flow from operating activities. We believe that EBITDA, EBITDAre and Adjusted EBITDAre provide useful information to investors because by excluding the effects of certain historical amounts, such as interest, depreciation and amortization expense, EBITDA, EBITDAre and Adjusted EBITDAre may facilitate a comparison of current operating performance with our past operating performance. EBITDA, EBITDAre and Adjusted EBITDAre do not represent cash generated by operating activities in accordance with GAAP and should not be considered alternatives to net income (loss), net income (loss) attributable to EQC common shareholders or cash flow from operating activities, determined in accordance with GAAP, or as indicators of our financial performance or liquidity, nor are these measures necessarily indicative of sufficient cash flow to fund all of our needs. These measures should be considered in conjunction with net income (loss), net income (loss) attributable to EQC common shareholders and cash flow from operating activities as presented in our condensed consolidated statements of operations and condensed consolidated statements of cash flows. Other REITs and real estate companies may calculate EBITDA, EBITDAre and Adjusted EBITDAre differently than we do.
Funds from Operations (FFO) and Normalized FFO
We compute FFO in accordance with standards established by Nareit. Nareit defines FFO as net income (loss), calculated in accordance with GAAP, excluding real estate depreciation and amortization, gains (or losses) from sales of depreciable property, impairment of depreciable real estate and our portion of these items related to equity investees and noncontrolling interests.  Our calculation of Normalized FFO differs from Nareit’s definition of FFO because we exclude certain items that we view as nonrecurring or impacting comparability from period to period.  FFO and Normalized FFO are supplemental non-GAAP financial measures. We consider FFO and Normalized FFO to be appropriate measures of operating performance for a REIT, along with net income (loss), net income (loss) attributable to EQC common shareholders and cash flow from operating activities.
We believe that FFO and Normalized FFO provide useful information to investors because by excluding the effects of certain historical amounts, such as depreciation expense, FFO and Normalized FFO may facilitate a comparison of our operating performance between periods and with other REITs.  FFO and Normalized FFO do not represent cash generated by operating activities in accordance with GAAP and should not be considered as alternatives to net income (loss), net income (loss) attributable to EQC common shareholders or cash flow from operating activities, determined in accordance with GAAP, or as indicators of our financial performance or liquidity, nor are these measures necessarily indicative of sufficient cash flow to fund all of our needs.  These measures should be considered in conjunction with net income (loss), net income (loss) attributable to EQC common shareholders and cash flow from operating activities as presented in our condensed consolidated statements of operations and condensed consolidated statements of cash flows.  Other REITs and real estate companies may calculate FFO and Normalized FFO differently than we do.
Leasing Costs
Leasing costs include leasing commissions (LCs) and related legal expenses.
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DEFINITIONS
LTIP Units
LTIP Units are a class of beneficial interests in EQC Operating Trust (the Operating Trust) that may be issued to employees, officers or trustees of the Operating Trust, EQC, or their subsidiaries.
Net Operating Income (NOI), Same Property NOI, Cash Basis NOI and Same Property Cash Basis NOI
NOI is income from our real estate including lease termination fees received from tenants less our property operating expenses. NOI excludes amortization of capitalized tenant improvement costs and leasing commissions and corporate level expenses. Cash Basis NOI is NOI excluding the effects of straight-line rent adjustments, lease value amortization and lease termination fees. The year-to-date same property versions of these measures include the results of properties continuously owned from January 1, 2023 through March 31, 2024. Properties classified as held for sale within our condensed consolidated balance sheets are excluded from the same property versions of these measures.
We consider these supplemental non-GAAP financial measures to be appropriate supplemental measures to net income (loss) because they may help to understand the operations of our properties. We use these measures internally to evaluate property level performance, and we believe that they provide useful information to investors regarding our results of operations because they reflect only those income and expense items that are incurred at the property level and may facilitate comparisons of our operating performance between periods and with other REITs. Cash Basis NOI is among the factors considered with respect to acquisition, disposition and financing decisions. These measures do not represent cash generated by operating activities in accordance with GAAP and should not be considered as an alternative to net income (loss), net income (loss) attributable to Equity Commonwealth common shareholders or cash flow from operating activities, determined in accordance with GAAP, or as indicators of our financial performance or liquidity, nor are these measures necessarily indicative of sufficient cash flow to fund all of our needs. These measures should be considered in conjunction with net income (loss), net income (loss) attributable to EQC common shareholders and cash flow from operating activities as presented in our condensed consolidated statements of operations and condensed consolidated statements of cash flows. Other REITs and real estate companies may calculate these measures differently than we do.
Net Book Value
Net book value represents the carrying value of real estate properties after depreciation and amortization, purchase price allocations and impairment write-downs, if any.
NOI Margin
NOI Margin is NOI (or the same property or cash basis derivations of NOI defined above) divided by the total revenues used to calculate NOI (or its derivation).
Operating Partnership Units
Operating Partnership Units are beneficial interests in the Operating Trust.
Other Revenue
Other revenue is primarily comprised of parking revenue that does not represent a component of a lease.
Percentage Commenced
Percentage commenced is the percentage of space subject to leases that have commenced for revenue recognition purposes in accordance with GAAP, which includes the space of tenants in a free rent period.
Percentage Leased
Percentage leased is the percentage of space subject to signed leases.
Rental Revenue
Rental revenue is primarily comprised of minimum lease payments from tenants, including tenant reimbursements. In addition, rental revenue includes lease termination fees and straight-line rent adjustments.
Same Properties
Our year-to-date same property portfolio is comprised of those properties continuously owned from January 1, 2023 through March 31, 2024. Properties classified as held for sale within our condensed consolidated balance sheets are excluded.
Tenant Improvements
Tenant improvements are capital expenditures to improve tenant spaces.

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DEFINITIONS
Total Market Capitalization
Total market capitalization is the market value of preferred shares plus the market value of diluted common shares. The market value of preferred shares is the product of the number of Series D preferred shares outstanding at the end of the period and the closing share price of the Series D preferred shares (EQCpD) at the end of the period. The market value of diluted common shares is the product of the number of diluted common shares outstanding at the end of the period and the closing share price of the common shares (EQC) at the end of the period.
Undepreciated Book Value
Undepreciated book value represents the carrying value of real estate properties after purchase price allocations, and impairment write-downs, if any.


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