CORRESP Filing
APARTMENT INVESTMENT & MANAGEMENT CO
Date: June 4, 2025 · CIK: 0000922864 · Accession: 0000950170-25-081681
AI Filing Summary & Sentiment
Reasoning
File numbers found in text: 001-13232
Referenced dates: May 27, 2025
Letter
June 4, 2025 Via EDGAR U.S. Securities and Exchange Commission Division of Corporation Finance Office of Real Estate & Construction 100 F Street, N.E. Washington, D.C. 20549 Attention: William Demarest and Kristina Marrone Re: Apartment Investment and Management Company Form 10-K for the year ended December 31, 2024 Form 8-K filed February 24, 2025 File No. 001-13232 Dear William Demarest and Kristina Marrone: This letter responds to the comments that Apartment Investment and Management Company (the “Company”, “we”, or “our”) received from the staff (the “Staff”) of the U.S. Securities and Exchange Commission (the “Commission”) by letter dated May 27, 2025, relating to the above-referenced filings. For reference, Staff comments have been included in italic, bold face type, followed by our responses in standard type. Form 10-K for the year ended December 31, 2024 Note 14 – Business Segments, page F-42 1. Please tell us how you have complied with ASC 280-10-50-26A in reporting significant expense categories regularly reported to your CODM. The Company acknowledges the Staff’s comment. We respectfully advise the Staff that before adoption of Accounting Standards Update (“ASU”) No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, we disclosed “Property operating expenses” as a single line item representing an aggregation of all segment expenses. An example of this disclosure before adoption of ASU 2023-07, as presented within our Form 10-Q for the quarter ended September 30, 2024, filed with the Commission on November 7, 2024, is depicted below:
Development and Redevelopment
Operating
Other
Proportionate and Other Adjustments (1)
Corporate and Amounts Not Allocated to Segments (2)
Consolidated
Three Months Ended September 30, 2024
Rental and other property revenues $ 6,631
$ 39,281
$ 4,979
$ 2,267
$ —
$ 53,158
Property operating expenses
3,940
11,883
3,829
2,276
1,409
23,337
Other operating expenses not allocated to segments (3)
—
—
—
—
31,295
31,295
Total operating expenses
3,940
11,883
3,829
2,276
32,704
54,632
Proportionate property net operating income (loss)
2,691
27,398
1,150
(9 )
(32,704 )
(1,474 )
Other items included in income before income tax (4)
—
—
—
—
(22,405 )
(22,405 )
Income (loss) before income tax $ 2,691
$ 27,398
$ 1,150
$ (9 )
$ (55,109 )
$ (23,879 )
After the adoption of ASU 2023-07, we separately identified “Controllable operating expenses”, “Real estate taxes, net of capitalized amounts”, “Utilities expense, net of utility reimbursements”, and “Property insurance expense, net of capitalized amounts” as the significant expense categories included in property net operating income (loss), our reported segment profit or loss measure. Each of these significant segment expense categories is regularly reported to the Company’s chief operating decision maker (“CODM”) and disclosed within the table presenting the results of operations for each segment in compliance
with ASC 280-10-50-26A. An example of this disclosure after adoption of ASU 2023-07, as presented within our Form 10-K for the year ended December 31, 2024, filed with the Commission on February 24, 2025, is depicted below:
Development and Redevelopment
Operating
Other
Adjustments (1)
Corporate and Amounts Not Allocated to Segments (2)
Consolidated
December 31, 2024
Rental and other property revenues $ 9,852
$ 140,099
$ 6,690
$ 7,977
$ 44,061
$ 208,679
Controllable operating expenses (3)
4,527
18,567
6,746
—
6,239
36,079
Real estate taxes, net of capitalized amounts
1,963
16,653
—
7,312
26,521
Utilities expense, net of utility reimbursements
1,959
3,096
7,977
1,410
14,697
Property insurance expense, net of capitalized amounts
1,019
2,773
—
2,059
5,969
Other property operating expenses (4)
—
—
—
—
7,718
7,718
Property operating expenses
9,468
41,089
7,712
7,977
24,738
90,984
Property net operating income (loss)
99,010
(1,022 )
—
19,323
117,695
Other operating expenses not allocated to segments (5)
—
—
—
—
(119,196 )
(119,196 )
Other items included in income before income tax (6)
—
—
—
—
(105,570 )
(105,570 )
Income (loss) before income tax $
$ 99,010
$ (1,022 )
$ —
$ (205,443 )
$ (107,071 )
“Controllable operating expenses”, “Real estate taxes, net of capitalized amounts”, “Utilities expense, net of utility reimbursements”, and “Property insurance expense, net of capitalized amounts” represented 40%, 29%, 16%, and 7%, respectively, of consolidated Property operating expenses for the year ended December 31, 2024, presented in the Consolidated Statements of Operations . The remaining 8% was presented in the “Other property operating expenses” line, with disclosure of its components, to reconcile to consolidated Property operating expenses presented in the Consolidated Statements of Operations . The CODM uses “Controllable operating expenses”, “Real estate taxes, net of capitalized amounts”, “Utilities expense, net of utility reimbursements”, and “Property insurance expense, net of capitalized amounts” to manage operations and is not routinely provided further disaggregation of these significant expense categories. Form 8-K filed February 24, 2025 Exhibits 2. We note that throughout your earnings release and supplemental schedules filed as Exhibit 99.1, you include disclosures related to the non-GAAP measures net operating income and property net operating income. In future filings please include a reconciliation of these measures to the most directly comparable GAAP measure. The Company acknowledges the Staff’s comment. In future earnings releases and supplemental schedules, we will present a reconciliation of income (loss) before income tax benefit to property net operating income. We will also revise our disclosures to consistently reference property net operating income as the defined term, which previously had been used interchangeably with net operating income. An example of our proposed revised disclosure based on our earnings release and supplemental schedules filed as Exhibit 99.1 to the Form 8-K furnished to the Commission on February 24, 2025, is as follows: PROPERTY NET OPERATING INCOME (NOI): Property NOI is defined by Aimco as total rental and other property revenues, excluding utility reimbursements, less property operating expenses, including utility reimbursements, for the consolidated apartment communities. Property NOI does not include: property management revenues, primarily from affiliates; casualties; property management expenses; depreciation; or interest expense. Aimco evaluates the performance of the apartment communities in its segments using Property NOI, which includes the apartment communities that Aimco consolidates and excludes apartment communities that it does not consolidate. Property NOI is helpful because it helps both investors and management to understand the operating performance of real estate excluding costs associated with decisions about acquisition pricing, overhead allocations, and financing arrangements.
The following table presents the reconciliation of GAAP income (loss) before income tax benefit to total Property NOI, as well as Property NOI for our Stabilized Operating apartment communities as presented on Supplemental Schedule 6 to total Property NOI.
Property NOI reconciliation
(dollars in thousands) (unaudited)
Three Months Ended December 31,
Twelve Months Ended December 31,
Income (loss) before income tax benefit per Consolidated Statements of Operations $ (9,976 )
$ (155,296 )
$ (107,071 )
$ (170,071 )
Adjustments:
Depreciation and amortization
21,236
17,728
86,359
68,834
General and administrative expenses
8,961
8,379
32,837
32,865
Interest income
(2,171 )
(2,709 )
(9,652 )
(9,731 )
Interest expense
20,835
10,085
70,057
37,718
Mezzanine (income) loss, net
154,801
2,432
155,814
Realized and unrealized (gains) losses on interest rate contracts
(588 )
2,161
(1,752 )
(1,119 )
Realized and unrealized (gains) losses on equity investments
1,403
(535 )
49,504
(700 )
Gain on dispositions of real estate
(10,749 )
(6,106 )
(10,600 )
(7,984 )
Other (income) expense
1,779
5,581
7,657
Total Property NOI $ 30,279
$ 30,287
$ 117,695
$ 113,283
Segment Property NOI reconciliation
(dollars in thousands) (unaudited)
Three Months Ended December 31,
Twelve Months Ended December 31,
Rental income:
Stabilized Operating $ 35,539
$ 34,339
$ 140,099
$ 134,078
Stabilized Operating utilities reimbursement [1]
1,721
1,560
6,506
5,706
Other Real Estate
1,802
1,251
6,690
2,691
Non-stabilized and other amounts not allocated [2]
15,109
12,202
55,384
44,520
Total rental income
54,171
49,352
208,679
186,995
Property operating expenses:
Stabilized Operating
9,591
9,517
41,089
39,356
Stabilized Operating utilities reimbursement [1]
1,721
1,560
6,506
5,706
Other Real Estate
1,969
1,348
7,712
4,710
Non-stabilized and other amounts not allocated [2]
10,611
6,640
35,677
23,940
Total property operating expenses:
23,892
19,065
90,984
73,712
Property NOI:
Stabilized Operating
25,948
24,822
99,010
94,722
Other Real Estate
(167 )
(97 )
(1,022 )
(2,019 )
Non-stabilized and other amounts not allocated [2]
4,498
5,562
19,707
20,580
Total Property NOI $ 30,279
$ 30,287
$ 117,695
$ 113,283
[1] Approximately two-thirds of Aimco’s utility costs at stabilized properties are reimbursed by residents. Utility reimbursements are included in rental and other property revenues on Aimco’s consolidated statements of operations prepared in accordance with GAAP. This adjustment represents the reclassification of utility reimbursements from revenues to property operating expenses for the purpose of evaluating segment results and as presented on Supplemental Schedule 6. Aimco also excludes the reimbursement amounts from the calculation of Average Revenue per Apartment Home throughout this Earnings Release and Supplemental Schedules. [2] Properties not included in the Stabilized Operating Portfolio and other amounts not allocated includes operating results of properties not presented in the Stabilized Operation Portfolio as presented on Supplemental Schedule 6 during the periods shown, as well as property management and casualty expense, which are not included in property operating expenses, net of utility reimbursements in the Supplemental Schedule 6 presentation. *****
In connection with our response to the Staff's comments, we acknowledge that the Company and its management are responsible for the accuracy and adequacy of its disclosures, notwithstanding any review, comments, action or absence of action by the Staff. We appreciate the Staff’s comments and request that the Staff contact the undersigned by phone at (983) 888-0660 or by email at lynn.stanfield@aimco.com with any questions or comments regarding this letter.
Sincerely,
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
Show Raw Text
CORRESP 1 filename1.htm CORRESP June 4, 2025 Via EDGAR U.S. Securities and Exchange Commission Division of Corporation Finance Office of Real Estate & Construction 100 F Street, N.E. Washington, D.C. 20549 Attention: William Demarest and Kristina Marrone Re: Apartment Investment and Management Company Form 10-K for the year ended December 31, 2024 Form 8-K filed February 24, 2025 File No. 001-13232 Dear William Demarest and Kristina Marrone: This letter responds to the comments that Apartment Investment and Management Company (the “Company”, “we”, or “our”) received from the staff (the “Staff”) of the U.S. Securities and Exchange Commission (the “Commission”) by letter dated May 27, 2025, relating to the above-referenced filings. For reference, Staff comments have been included in italic, bold face type, followed by our responses in standard type. Form 10-K for the year ended December 31, 2024 Note 14 – Business Segments, page F-42 1. Please tell us how you have complied with ASC 280-10-50-26A in reporting significant expense categories regularly reported to your CODM. The Company acknowledges the Staff’s comment. We respectfully advise the Staff that before adoption of Accounting Standards Update (“ASU”) No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, we disclosed “Property operating expenses” as a single line item representing an aggregation of all segment expenses. An example of this disclosure before adoption of ASU 2023-07, as presented within our Form 10-Q for the quarter ended September 30, 2024, filed with the Commission on November 7, 2024, is depicted below: Development and Redevelopment Operating Other Proportionate and Other Adjustments (1) Corporate and Amounts Not Allocated to Segments (2) Consolidated Three Months Ended September 30, 2024 Rental and other property revenues $ 6,631 $ 39,281 $ 4,979 $ 2,267 $ — $ 53,158 Property operating expenses 3,940 11,883 3,829 2,276 1,409 23,337 Other operating expenses not allocated to segments (3) — — — — 31,295 31,295 Total operating expenses 3,940 11,883 3,829 2,276 32,704 54,632 Proportionate property net operating income (loss) 2,691 27,398 1,150 (9 ) (32,704 ) (1,474 ) Other items included in income before income tax (4) — — — — (22,405 ) (22,405 ) Income (loss) before income tax $ 2,691 $ 27,398 $ 1,150 $ (9 ) $ (55,109 ) $ (23,879 ) After the adoption of ASU 2023-07, we separately identified “Controllable operating expenses”, “Real estate taxes, net of capitalized amounts”, “Utilities expense, net of utility reimbursements”, and “Property insurance expense, net of capitalized amounts” as the significant expense categories included in property net operating income (loss), our reported segment profit or loss measure. Each of these significant segment expense categories is regularly reported to the Company’s chief operating decision maker (“CODM”) and disclosed within the table presenting the results of operations for each segment in compliance with ASC 280-10-50-26A. An example of this disclosure after adoption of ASU 2023-07, as presented within our Form 10-K for the year ended December 31, 2024, filed with the Commission on February 24, 2025, is depicted below: Development and Redevelopment Operating Other Adjustments (1) Corporate and Amounts Not Allocated to Segments (2) Consolidated December 31, 2024 Rental and other property revenues $ 9,852 $ 140,099 $ 6,690 $ 7,977 $ 44,061 $ 208,679 Controllable operating expenses (3) 4,527 18,567 6,746 — 6,239 36,079 Real estate taxes, net of capitalized amounts 1,963 16,653 593 — 7,312 26,521 Utilities expense, net of utility reimbursements 1,959 3,096 255 7,977 1,410 14,697 Property insurance expense, net of capitalized amounts 1,019 2,773 118 — 2,059 5,969 Other property operating expenses (4) — — — — 7,718 7,718 Property operating expenses 9,468 41,089 7,712 7,977 24,738 90,984 Property net operating income (loss) 384 99,010 (1,022 ) — 19,323 117,695 Other operating expenses not allocated to segments (5) — — — — (119,196 ) (119,196 ) Other items included in income before income tax (6) — — — — (105,570 ) (105,570 ) Income (loss) before income tax $ 384 $ 99,010 $ (1,022 ) $ — $ (205,443 ) $ (107,071 ) “Controllable operating expenses”, “Real estate taxes, net of capitalized amounts”, “Utilities expense, net of utility reimbursements”, and “Property insurance expense, net of capitalized amounts” represented 40%, 29%, 16%, and 7%, respectively, of consolidated Property operating expenses for the year ended December 31, 2024, presented in the Consolidated Statements of Operations . The remaining 8% was presented in the “Other property operating expenses” line, with disclosure of its components, to reconcile to consolidated Property operating expenses presented in the Consolidated Statements of Operations . The CODM uses “Controllable operating expenses”, “Real estate taxes, net of capitalized amounts”, “Utilities expense, net of utility reimbursements”, and “Property insurance expense, net of capitalized amounts” to manage operations and is not routinely provided further disaggregation of these significant expense categories. Form 8-K filed February 24, 2025 Exhibits 2. We note that throughout your earnings release and supplemental schedules filed as Exhibit 99.1, you include disclosures related to the non-GAAP measures net operating income and property net operating income. In future filings please include a reconciliation of these measures to the most directly comparable GAAP measure. The Company acknowledges the Staff’s comment. In future earnings releases and supplemental schedules, we will present a reconciliation of income (loss) before income tax benefit to property net operating income. We will also revise our disclosures to consistently reference property net operating income as the defined term, which previously had been used interchangeably with net operating income. An example of our proposed revised disclosure based on our earnings release and supplemental schedules filed as Exhibit 99.1 to the Form 8-K furnished to the Commission on February 24, 2025, is as follows: PROPERTY NET OPERATING INCOME (NOI): Property NOI is defined by Aimco as total rental and other property revenues, excluding utility reimbursements, less property operating expenses, including utility reimbursements, for the consolidated apartment communities. Property NOI does not include: property management revenues, primarily from affiliates; casualties; property management expenses; depreciation; or interest expense. Aimco evaluates the performance of the apartment communities in its segments using Property NOI, which includes the apartment communities that Aimco consolidates and excludes apartment communities that it does not consolidate. Property NOI is helpful because it helps both investors and management to understand the operating performance of real estate excluding costs associated with decisions about acquisition pricing, overhead allocations, and financing arrangements. The following table presents the reconciliation of GAAP income (loss) before income tax benefit to total Property NOI, as well as Property NOI for our Stabilized Operating apartment communities as presented on Supplemental Schedule 6 to total Property NOI. Property NOI reconciliation (dollars in thousands) (unaudited) Three Months Ended December 31, Twelve Months Ended December 31, 2024 2023 2024 2023 Income (loss) before income tax benefit per Consolidated Statements of Operations $ (9,976 ) $ (155,296 ) $ (107,071 ) $ (170,071 ) Adjustments: Depreciation and amortization 21,236 17,728 86,359 68,834 General and administrative expenses 8,961 8,379 32,837 32,865 Interest income (2,171 ) (2,709 ) (9,652 ) (9,731 ) Interest expense 20,835 10,085 70,057 37,718 Mezzanine (income) loss, net 548 154,801 2,432 155,814 Realized and unrealized (gains) losses on interest rate contracts (588 ) 2,161 (1,752 ) (1,119 ) Realized and unrealized (gains) losses on equity investments 1,403 (535 ) 49,504 (700 ) Gain on dispositions of real estate (10,749 ) (6,106 ) (10,600 ) (7,984 ) Other (income) expense 779 1,779 5,581 7,657 Total Property NOI $ 30,279 $ 30,287 $ 117,695 $ 113,283 Segment Property NOI reconciliation (dollars in thousands) (unaudited) Three Months Ended December 31, Twelve Months Ended December 31, 2024 2023 2024 2023 Rental income: Stabilized Operating $ 35,539 $ 34,339 $ 140,099 $ 134,078 Stabilized Operating utilities reimbursement [1] 1,721 1,560 6,506 5,706 Other Real Estate 1,802 1,251 6,690 2,691 Non-stabilized and other amounts not allocated [2] 15,109 12,202 55,384 44,520 Total rental income 54,171 49,352 208,679 186,995 Property operating expenses: Stabilized Operating 9,591 9,517 41,089 39,356 Stabilized Operating utilities reimbursement [1] 1,721 1,560 6,506 5,706 Other Real Estate 1,969 1,348 7,712 4,710 Non-stabilized and other amounts not allocated [2] 10,611 6,640 35,677 23,940 Total property operating expenses: 23,892 19,065 90,984 73,712 Property NOI: Stabilized Operating 25,948 24,822 99,010 94,722 Other Real Estate (167 ) (97 ) (1,022 ) (2,019 ) Non-stabilized and other amounts not allocated [2] 4,498 5,562 19,707 20,580 Total Property NOI $ 30,279 $ 30,287 $ 117,695 $ 113,283 [1] Approximately two-thirds of Aimco’s utility costs at stabilized properties are reimbursed by residents. Utility reimbursements are included in rental and other property revenues on Aimco’s consolidated statements of operations prepared in accordance with GAAP. This adjustment represents the reclassification of utility reimbursements from revenues to property operating expenses for the purpose of evaluating segment results and as presented on Supplemental Schedule 6. Aimco also excludes the reimbursement amounts from the calculation of Average Revenue per Apartment Home throughout this Earnings Release and Supplemental Schedules. [2] Properties not included in the Stabilized Operating Portfolio and other amounts not allocated includes operating results of properties not presented in the Stabilized Operation Portfolio as presented on Supplemental Schedule 6 during the periods shown, as well as property management and casualty expense, which are not included in property operating expenses, net of utility reimbursements in the Supplemental Schedule 6 presentation. ***** In connection with our response to the Staff's comments, we acknowledge that the Company and its management are responsible for the accuracy and adequacy of its disclosures, notwithstanding any review, comments, action or absence of action by the Staff. We appreciate the Staff’s comments and request that the Staff contact the undersigned by phone at (983) 888-0660 or by email at lynn.stanfield@aimco.com with any questions or comments regarding this letter. Sincerely, APARTMENT INVESTMENT AND MANAGEMENT COMPANY /s/ H. Lynn C. Stanfield H. Lynn C. Stanfield Executive Vice President and Chief Financial Officer cc: Julian T.H. Kleindorfer, Latham & Watkins LLP Brent T. Epstein, Latham & Watkins LLP