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Item 9A. Controls and Procedures

2021-02-19 compared with 2020-02-19 · 659 added, 700 removed, 1056 unchanged (56% of the section changed)

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Disclosure Controls and Procedures

We maintain a set of disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) designed to ensure that information required to be disclosed in reports we file or submit under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures.

information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures.

The design of any disclosure controls and procedures is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its goals under all potential future conditions.

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Consolidated Financial Statements as of December 31, 2020 and 2019 and for the three years in the period ended December 31, 2020

Report of Deloitte & Touche LLP, Independent Registered Public Accounting Firm

Consolidated Balance Sheets

Consolidated Statements of Operations

Consolidated Statements of Other Comprehensive Loss

Consolidated Statements of Equity

Consolidated Statements of Cash Flows

Notes to Consolidated Financial Statements

Report of Deloitte & Touche LLP, Independent Registered Public Accounting Firm F- 1

Consolidated Balance Sheets F- 3

Consolidated Statements of Operations F- 4

Consolidated Statements of Comprehensive Loss F- 5

Consolidated Statements of Equity F- 6

Consolidated Statements of Cash Flows F- 7

Notes to Consolidated Financial Statements F- 9

(b) Financial Statement Schedule

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as of December 31, 2020 and for the three years in the period ended December 31, 2020

Schedule III Real Estate and Accumulated Depreciation

Schedule III Real Estate and Accumulated Depreciation F- 44

EXHIBIT INDEX

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4.3 First Supplemental Indenture between Invitation Homes Inc., IH Merger Sub LLC and Wilmington Trust, National Association, as trustee dated as of November 16, 2017 (incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K (File No.1-38004) filed on November 20, 2017).

Description of Securities.

4.4 Description of Securities (incorporated by reference to Exhibit 4.4 to the Company’s Current Report on Form 10-K (File No.

1-38004) filed on February 19, 2020).

10.1 Amended and Restated Stockholders Agreement by and among Invitation Homes Inc., each of the parties from time to time party thereto and, solely for the purposes of Section 4.1, Blackstone Real Estate Advisors L.P.

19 unchanged sentences

1-38004) filed on February 6, 2017).

Loan Agreement, between 2014-2 IH Borrower L.P.

and German American Capital Corporation, dated as of August 14, 2014 (incorporated by reference to Exhibit 10.6 to the Company’s Registration Statement on Form S-11 (No.

333-215452) filed on January 6, 2017).

Loan Agreement, between 2014-3 IH Borrower L.P.

and German American Capital Corporation, dated as of November 12, 2014 (incorporated by reference to Exhibit 10.7 to the Company’s Registration Statement on Form S-11 (No.

333-215452) filed on January 6, 2017).

Loan Agreement, between 2015-1 IH2 Borrower L.P.

and JPMorgan Chase Bank, National Association, dated as of January 29, 2015 (incorporated by reference to Exhibit 10.8 to the Company’s Registration Statement on Form S-11 (No.

333-215452) filed on January 6, 2017).

Loan Agreement, between 2015-2 IH2 Borrower L.P.

and JPMorgan Chase Bank, National Association, dated as of April 10, 2015 (incorporated by reference to Exhibit 10.9 to the Company’s Registration Statement on Form S-11 (No.

333-215452) filed on January 6, 2017).

Loan Agreement, between 2015-3 IH2 Borrower L.P.

and JPMorgan Chase Bank, National Association, dated as of June 25, 2015 (incorporated by reference to Exhibit 10.10 to the Company’s Registration Statement on Form S-11 (No.

333-215452) filed on January 6, 2017).

10.10 Amended and Restated Revolving Credit and Term Loan Agreement, dated as of December 8, 2020, by and among Invitation Homes Operating Partnership LP, as borrower, the lenders party thereto, Bank of America, N.A., as administrative agent and the other parties party thereto (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K (File No.

1-38004) filed on December 9, 2021).

10.11 Loan Agreement, dated as of April 28, 2017, between IH 2017-1 Borrower, LP, as Borrower, and Wells Fargo Bank, National Association, as Lender (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K (File No.

6 unchanged sentences

1-38004) filed on May 9, 2018).

Exhibit number

10.15 Loan Agreement, dated as of June 28, 2018, between IH 2018-3 Borrower, LP, as Borrower, and German American Capital Corporation, as Lender (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K (File No.

6 unchanged sentences

1-36163) filed August 9, 2016).

Exhibit number

10.19 Loan Agreement, dated as of June 11, 2015, between CAH 2015-1 Borrower, LLC, as Borrower, and JPMorgan Chase Bank, National Association, as Lender (incorporated by reference to Exhibit 10.5 of SWH’s Quarterly Report on Form 10-Q (File No.

1-36163) filed August 9, 2016).

Loan Agreement, dated as of June 7, 2016, between CSH 2016-1 Borrower, LLC, as Borrower, and JPMorgan Chase Bank, National Association, as Lender (incorporated by reference to Exhibit 10.1 of SWH’s Current Report on Form 8-K (File No.

1-36163) filed June 8, 2016).

Loan Agreement, dated as of November 3, 2016, between CSH 2016-2 Borrower, LLC, as Borrower, and JPMorgan Chase Bank, National Association, as Lender (incorporated by reference to Exhibit 10.2 of SWH’s Quarterly Report on Form 10-Q (File No.

1-36163) filed November 7, 2016).

10.20 Loan Agreement, dated as of June 7, 2019, between 2019-1 IH Borrower LP, as Borrower, and Rothesay Life PLC, as Lender (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K (File No.

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10.23 Letter Agreement, dated August 9, 2017 by and between Invitation Homes Inc.

and John Bartling (incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K (File No.

1-38004) filed on August 14, 2017).

Letter Agreement, dated August 9, 2017 by and between Invitation Homes Inc.

and Ernest Freedman (incorporated by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K (File No.

3 unchanged sentences

1-38004) filed on August 14, 2017).

Exhibit number

10.25 Term Sheet, dated September 19, 2017, between Invitation Homes Inc.

5 unchanged sentences

1-38004) filed on November 20, 2017).

Form of Invitation Homes 6 L.P.

Bonus Award Program Letter Agreement (incorporated by reference to Exhibit 10.14 to the Company’s Registration Statement on Form S-11 (No.

333-215452) filed on January 23, 2017).

Form of Invitation Homes Inc.

Restricted Stock Grant and Acknowledgment (Converted Incentive Units) (incorporated by reference to Exhibit 10.15 to the Company’s Registration Statement on Form S-11 (No.

333-215452) filed on January 23, 2017).

10.27 Form of Award Notice and Restricted Stock Unit Agreement for Mr.

(Supplemental Bonus Award (2 Tranche Vesting)) (incorporated by reference to Exhibit 10.16 to the Company’s Registration Statement on Form S-11 (No.

333-215452) filed on January 23, 2017).

Form of Award Notice and Restricted Stock Unit Agreement for Mr.

(Supplemental Bonus Award (3 Tranche Vesting)) (incorporated by reference to Exhibit 10.17 to the Company’s Registration Statement on Form S-11 (No.

333-215452) filed on January 23, 2017).

Form of Award Notice and Restricted Stock Unit Agreement for Mr.

Freedman (Supplemental Bonus Award) (incorporated by reference to Exhibit 10.18 to the Company’s Registration Statement on Form S-11 (No.

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1-38004) filed on June 29, 2017).

Exhibit number

10.32 Form of Award Notice and Restricted Stock Unit Agreement (Retention Award - Messrs.

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1-38004) filed on August 10, 2018).

Exhibit number

10.34 Form of Award Notice and Restricted Stock Unit Agreement (2019 LTIP Equity Award) (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q (File No.

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10.44 Invitation Homes Inc.

Executive Severance Plan (incorporated by reference to Exhibit 10.47 to the Company’s Annual Report on Form 10-K (File No.

1-38004) filed March 29, 2018).

Master Repurchase Agreement, dated March 11, 2014, among Starwood Waypoint Residential Trust, PrimeStar Fund I, L.P., Wilmington Savings Fund Society, FSB and Deutsche Bank AG, Cayman Islands Branch (incorporated by reference to Exhibit 10.1 of SWH’s Current Report on Form 8-K (File No.

1-36163) filed March 13, 2014).

Amendment No.

1, dated June 26, 2014, to the Master Repurchase Agreement, dated March 11, 2014, among Starwood Waypoint Residential Trust, PrimeStar Fund I, L.P., Wilmington Savings Fund Society, FSB and Deutsche AG, Cayman Islands Branch (incorporated by reference to Exhibit 10.1 of SWH’s Current Report on Form 8-K (File No.

1-36163) filed June 30, 2014).

Executive Severance Plan (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q (File No.

1-38004) filed on May 7, 2020.

Exhibit number

Amendment No.

3, dated September 1, 2015, to the Master Repurchase Agreement, dated March 11, 2014, among Starwood Waypoint Residential Trust, PrimeStar Fund I, L.P., Wilmington Savings Fund Society, FSB and Deutsche Bank AG, Cayman Islands Branch (incorporated by reference to Exhibit 10.1 of SWH’s Current Report on Form 8-K (File No.

1-36163) filed September 4, 2015).

Amended and Restated Limited Partnership Agreement of PrimeStar Fund I, L.P., dated as of December 16, 2014 and Effective as of March 1, 2014 (incorporated by reference to Exhibit 10.1 of SWH’s Current Report on Form 8-K (File No.

1-36163) filed December 22, 2014).

10.45 Securities Purchase Agreement, dated as of June 5, 2017, between Waypoint/GI Venture, LLC and CSH Property Three, LLC (incorporated by reference to Exhibit 10.1 of the SWH’s Current Report on Form 8-K (File No.

1-36163) filed June 5, 2017).

10.46 Form of Award Notice and Restricted Stock Unit Agreement (2020 LTIP Equity Award) (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K (File No.

1-38004) filed on February 25, 2020).†

21.1 Subsidiaries of the Registrant.

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Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith).

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104 Cover page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

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Pursuant to the requirements of the Securities Act of 1934, this report has been signed by the following persons in the capacities indicated on the 19th day of February 2021.

Signature Title

/s/ Dallas B.

President, Chief Executive Officer, and Director

(Principal Executive Officer)

Tanner President, Chief Executive Officer, and Director

Tanner (Principal Executive Officer)

/s/ Ernest M.

Executive Vice President and Chief Financial Officer

(Principal Financial Officer)

Freedman Executive Vice President and Chief Financial Officer

Freedman (Principal Financial Officer)

/s/ Kimberly K.

Senior Vice President and Chief Accounting Officer

(Principal Accounting Officer)

/s/ Bryce Blair

Chairman and Director

Norrell Executive Vice President and Chief Accounting Officer

Norrell (Principal Accounting Officer)

/s/ Bryce Blair Chairman and Director

Barbe Director

/s/ Richard D.

/s/ Kenneth A.

Bronson Director

/s/ Michael D.

/s/ Robert G.

Fascitelli Director

/s/ Jeffrey E.

Kelter Director

Signature Title

/s/ Joseph D.

Margolis Director

Rhea Director

Heidi Roizen Director

/s/ Janice L.

Sears Director

/s/ William J.

Stein Director

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

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We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current-period audit of the financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Investments in Single-Family Residential Properties—Refer to Notes 2 and 3 to the financial statements

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The Company capitalizes costs to acquire, stabilize, and prepare single-family residential properties to be leased.

The determination of which costs to capitalize, the useful life of the respective capitalized cost, and the classification of assets as held for sale and held for use requires significant management judgment.

Furthermore, the Company evaluates investments in single-family residential properties to determine whether there have been any changes in circumstances that may indicate that the carrying value of individual properties may not be recoverable.

The determination of which costs to capitalize requires significant management judgment.

Costs capitalized in connection with single-family residential property acquisitions, stabilization activities, and on an ongoing basis are depreciated over their estimated useful lives on a straight-line basis.

From time to time, the Company identifies single-family residential properties to be sold.

At the time such properties are identified, the Company evaluates whether or

not such properties should be classified as held for sale.

Further, the Company evaluates investments in single-family residential properties to determine whether there have been any changes in circumstances that may indicate that the carrying value of individual properties may not be recoverable.

Given management’s (1) inputs and assumptions used to determine purchase price allocation based upon the relative fair values of asset components, (2) determination of which costs improve or extend the life of a property, (3) evaluation of single-family residential properties for impairment which requires significant judgment and assessment of factors that are, at times, subject to significant uncertainty, and (4) application of held for sale classification criteria, performing audit procedures to evaluate the accounting for investments in single-family residential properties was challenging and required an increased extent of audit effort.

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• We evaluated the appropriateness of management’s allocation of the initial purchase price for newly acquired properties by developing independent estimates for the purchase price allocation for each residential market in which the properties were acquired and comparing our estimates to the Company’s actual allocation.

We selected a sample of costs capitalized during the year and evaluated the accuracy and classification of the recorded amounts.

We also evaluated repairs and maintenance costs that were charged to expense.

We evaluated management’s analysis of possible impairment indicators for properties by independently assessing trends in the residential markets in which the Company has significant investments in single-family residential properties, trends in gains or losses on sales of properties, and macroeconomic data to identify any indicators that the carrying value of properties may not be recoverable.

• We selected a sample of costs capitalized during the year and evaluated the accuracy and classification of recorded amounts.

We also developed an expectation of repairs and maintenance costs that were charged to expense based on the historical amounts recorded, taking into account changes in the portfolio of single-family residential properties and market conditions, and compared our expectation to the recorded balance.

• We evaluated management’s analysis of possible impairment indicators for properties by independently assessing trends in the residential markets in which the Company has significant investments in single-family residential properties, trends in gains or losses from sales of properties, and macroeconomic data to identify any indicators that the carrying value of properties may not be recoverable.

• We selected a sample of properties classified as held for sale and evaluated whether the properties met the criteria to be classified as held for sale as of December 31, 2020.

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• We selected a sample of properties disposed during the year and evaluated the terms and conditions of the sales contracts to assess whether the sale was properly recorded, including the removal of assets from the accounting records and related gain or loss on sale.

Derivative Instruments — Refer to Notes 2, 7, and 11 to the financial statements

Critical Audit Matter Description

The Company uses derivative instruments to manage the economic risk of changes in interest rates.

As of December 31, 2019 , the Company had derivative instruments of $1.6 million recorded at fair value in other assets and derivative instruments of $275.7 million recorded at fair value in other liabilities.

Given the judgment needed to estimate the fair value of derivative instruments, and the volatility of the fair value based on market conditions, auditing the fair value and related inputs, such as forward yield curves and nonperformance risk, involved especially subjective and complex judgment.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the assumptions used by management to estimate the fair value of derivative instruments included the following, among others:

We tested the effectiveness of relevant controls, including management’s evaluation of its third party fair value specialist and the results of such specialist’s work.

With the assistance of our fair value specialists, we evaluated the appropriateness of management’s valuation of derivative instruments by developing independent fair value estimates for a sample of instruments and comparing our estimates to the Company’s estimates.

/s/ Deloitte & Touche LLP

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Investments in single-family residential properties:

$ 4,539,796 $ 4,499,346

Building and improvements

14,261,954 13,747,818

18,801,750 18,247,164

accumulated depreciation

( 2,513,057 ) ( 2,003,972 )

Investments in single-family residential properties, net

16,288,693 16,243,192

Cash and cash equivalents

213,422 92,258

Restricted cash

198,346 193,987

258,207 258,207

Investments in unconsolidated joint ventures 69,267 54,778

Other assets, net

478,287 550,488

Total assets $ 17,506,222 $ 17,392,910

Mortgage loans, net

$ 4,820,098 $ 6,238,461

Secured term loan, net

401,095 400,978

Term loan facility, net

2,470,907 1,493,747

Revolving facility

Convertible senior notes, net

339,404 334,299

Accounts payable and accrued expenses

149,299 186,110

Resident security deposits

157,936 147,787

Other liabilities

611,410 325,450

Total liabilities 8,950,149 9,126,832

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Stockholders' equity

Preferred stock, $0.01 par value per share, 900,000,000 shares authorized, none outstanding as of December 31, 2019 and 2018

Common stock, $0.01 par value per share, 9,000,000,000 shares authorized, 541,642,725 and 520,647,977 outstanding as of December 31, 2019 and 2018, respectively

Preferred stock, $0.01 par value per share, 900,000,000 shares authorized, none outstanding as of December 31, 2020 and December 31, 2019

Common stock, $0.01 par value per share, 9,000,000,000 shares authorized, 567,117,666 and 541,642,725 outstanding as of December 31, 2020 and December 31, 2019, respectively

Additional paid-in capital

9,707,258 9,010,194

Accumulated deficit

( 661,162 ) ( 524,588 )

Accumulated other comprehensive loss

( 546,942 ) ( 276,600 )

Total stockholders' equity

8,504,825 8,214,422

Non-controlling interests

51,248 51,656

Total equity 8,556,073 8,266,078

Total liabilities and equity $ 17,506,222 $ 17,392,910

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For the Years Ended December 31,

2020 2019 2018

Rental revenues and other property income $ 1,822,828 $ 1,764,685 $ 1,722,962

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Total expenses 1,709,610 1,725,510 1,784,615

Unrealized gains on investments in equity securities 29,723 6,480 —

Other, net ( 86 ) 5,120 6,958

Gain on sale of property, net of tax 54,594 96,336 49,682

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Net income (loss) attributable to common stockholders 196,212 145,463 ( 4,927 )

For the Year Ended December 31, 2019

For the Year Ended December 31, 2018

February 1, 2017

December 31, 2017

Net income available to participating securities

( 448 ) ( 395 ) ( 817 )

Net income (loss) available to common stockholders — basic and diluted (Note 12)

$ 195,764 $ 145,068 $ ( 5,744 )

Weighted average common shares outstanding — basic

553,993,321 531,235,962 520,376,929

Weighted average common shares outstanding — diluted

555,458,607 532,499,787 520,376,929

Net income (loss) per common share — basic $ 0.35 $ 0.27 $ ( 0.01 )

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For the Years Ended December 31,

2020 2019 2018

Net income (loss) $ 197,449 $ 147,111 $ ( 5,013 )

Other comprehensive income (loss)

Unrealized gains (losses) on interest rate swaps

(Gains) losses from interest rate swaps reclassified into earnings from accumulated other comprehensive income (loss)

Other comprehensive income (loss)

Other comprehensive loss

Unrealized losses on interest rate swaps ( 388,466 ) ( 244,126 ) ( 43,211 )

(Gains) losses from interest rate swaps reclassified into earnings from accumulated other comprehensive loss 116,549 ( 20,763 ) ( 18,627 )

Other comprehensive loss ( 271,917 ) ( 264,889 ) ( 61,838 )

Comprehensive loss ( 74,468 ) ( 117,778 ) ( 66,851 )

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(in thousands, except share and per share data)

Combined Equity

Number of Shares

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Balance as of December 31, 2017 519,173,142 $ 5,192 $ 8,602,603 $ ( 157,595 ) $ 47,885 $ 8,498,085 $ 151,790 $ 8,649,875

Redemption of Series A Preferred Stock

Distribution of Class B notes receivable

Cancellation/distribution of Class B notes receivable

Share-based compensation expense

Accrued interest on Class B notes

Balance as of January 31, 2017

Pre-IPO reorganization transactions

Issuance of common stock — IPO

Stock issuance costs — IPO

Issuance of common stock and INVH LP units — Mergers

Stock issuance costs — Mergers

Capital distributions

— — — — — — ( 4,020 ) ( 4,020 )

— — — ( 4,927 ) — ( 4,927 ) ( 86 ) ( 5,013 )

Dividends and dividend equivalents declared ($0.44 per share)

— — — ( 230,072 ) — ( 230,072 ) — ( 230,072 )

Issuance of common stock — settlement of RSUs, net of tax

1,069,798 10 ( 9,255 ) — — ( 9,245 ) — ( 9,245 )

Share-based compensation expense

— — 29,499 — — 29,499 — 29,499

Total other comprehensive income

— — — — ( 60,774 ) ( 60,774 ) ( 1,064 ) ( 61,838 )

Redemption of OP Units for common stock

405,037 4 6,615 — ( 74 ) 6,545 ( 6,545 ) —

Balance as of December 31, 2018 520,647,977 5,206 8,629,462 ( 392,594 ) ( 12,963 ) 8,229,111 140,075 8,369,186

Capital distributions

— — — — — — ( 3,074 ) ( 3,074 )

— — — 145,463 — 145,463 1,648 147,111

Dividends and dividend equivalents declared ($0.52 per share) — — — ( 277,457 ) — ( 277,457 ) — ( 277,457 )

Issuance of common stock — settlement of RSUs, net of tax

910,452 9 ( 8,173 ) — — ( 8,164 ) — ( 8,164 )

Issuance of common stock — settlement of 2019 Convertible Notes

12,553,864 126 229,818 — — 229,944 — 229,944

Issuance of common stock, net

1,957,139 20 55,243 — — 55,263 — 55,263

Share-based compensation expense

Total other comprehensive income

— — 16,724 — — 16,724 1,434 18,158

Total other comprehensive loss

— — — — ( 261,357 ) ( 261,357 ) ( 3,532 ) ( 264,889 )

Redemption of OP Units for common stock

5,573,293 55 87,120 — ( 2,280 ) 84,895 ( 84,895 ) —

Balance as of December 31, 2019 541,642,725 5,416 9,010,194 ( 524,588 ) ( 276,600 ) 8,214,422 51,656 8,266,078

Capital distributions

— — — — — — ( 2,137 ) ( 2,137 )

— — — 196,212 — 196,212 1,237 197,449

Dividends and dividend equivalents declared ($0.60 per share)

— — — ( 332,786 ) — ( 332,786 ) — ( 332,786 )

Issuance of common stock — settlement of RSUs, net of tax

Issuance of common stock — settlement of 2019 Convertible Notes

386,717 4 ( 4,431 ) — — ( 4,427 ) — ( 4,427 )

Issuance of common stock, net

25,088,224 251 686,472 — — 686,723 — 686,723

Share-based compensation expense

— — 15,023 — — 15,023 2,067 17,090

Total other comprehensive loss

Redemption of OP Units for common stock

— — — — ( 270,342 ) ( 270,342 ) ( 1,575 ) ( 271,917 )

Balance as of December 31, 2020

567,117,666 $ 5,671 $ 9,707,258 $ ( 661,162 ) $ ( 546,942 ) $ 8,504,825 $ 51,248 $ 8,556,073

The accompanying notes are an integral part of these consolidated financial statements.

3 unchanged sentences

For the Years Ended December 31,

2020 2019 2018

Operating Activities:

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Provisions for impairment 4,578 14,210 6,709

Unrealized gains on investments in equity securities ( 29,723 ) ( 6,480 ) —

Gain on sale of property, net of tax ( 54,594 ) ( 96,336 ) ( 49,682 )

Change in fair value of derivative instruments 9,129 1,913 12,039

Other noncash amounts included in net income (loss)

Other non-cash amounts included in net income (loss) 3,288 ( 89 ) 6,342

Changes in operating assets and liabilities:

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Investing Activities:

Cash and restricted cash acquired in the Mergers (Note 15)

Amounts deposited and held by others ( 906 ) ( 395 ) 9,074

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Repayment proceeds from retained debt securities 72,106 49,960 224,035

Investments in unconsolidated joint ventures ( 16,345 ) — —

Other investing activities ( 2,188 ) 4,834 ( 9,266 )

Net cash provided by investing activities

Net cash provided by (used in) investing activities ( 425,156 ) 102,226 62,993

Financing Activities:

Proceeds from IPO, net of underwriting discounts

IPO costs paid

Merger costs paid

Payment of dividends and dividend equivalents ( 332,151 ) ( 276,681 ) ( 230,072 )

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Payment of taxes related to net share settlement of RSUs ( 4,427 ) ( 8,164 ) ( 9,245 )

Payments on credit facilities

Proceeds from mortgage loans — — 4,234,483

Payments on mortgage loans ( 1,434,626 ) ( 997,421 ) ( 4,579,594 )

INVITATION HOMES INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)

(in thousands)

For the Years Ended December 31,

Proceeds from secured term loan — 403,464 —

Payments on secured term loan ( 101 ) — —

Proceeds from term loan facility 2,500,000 — —

Payments on term loan facility ( 1,500,000 ) — —

Proceeds from revolving facility 320,000 485,000 285,000

Payments on revolving facility ( 320,000 ) ( 485,000 ) ( 320,000 )

INVITATION HOMES INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)

(in thousands)

For the Years Ended December 31,

2020 2019 2018

Proceeds from issuance of common stock, net 686,723 55,263 —

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Cash, cash equivalents, and restricted cash, beginning of period (Note 4)

286,245 359,991 416,562

Cash, cash equivalents, and restricted cash, end of period (Note 4)

$ 411,768 $ 286,245 $ 359,991

Supplemental cash flow disclosures:

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Cash paid for amounts included in the measurement of lease liabilities:

Operating cash flows from operating leases

Noncash investing and financing activities:

Operating cash flows from operating leases 5,560 5,365 N/A

Financing cash flows from finance leases 2,382 498 N/A

Non-cash investing and financing activities:

Accrued renovation improvements at period end $ 7,709 $ 13,382 $ 7,189

1 unchanged sentence

Transfer of residential property, net to other assets, net for held for sale assets 168,533 545,448 441,005

Reclassification of IPO costs from other assets to additional paid-in capital

Change in other comprehensive income (loss) from cash flow hedges

ROU assets obtained in exchange for operating lease liabilities

Capital leases

Change in other comprehensive loss from cash flow hedges ( 280,773 ) ( 266,676 ) ( 73,242 )

ROU assets obtained in exchange for operating lease liabilities 6,427 1,721 N/A

ROU assets obtained in exchange for finance lease liabilities 9,561 — N/A

Capital leases N/A N/A 2,209

Net settlement of 2019 Convertible Notes in shares of common stock — 229,944 —

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Invitation Homes Inc.

(“INVH”), a real estate investment trust (“REIT”), conducts its operations through Invitation Homes Operating Partnership LP (“INVH LP”).

(“INVH”) is a real estate investment trust (“REIT”) that conducts its operations through Invitation Homes Operating Partnership LP (“INVH LP”).

INVH LP was formed for the purpose of owning, renovating, leasing, and operating single-family residential properties.

Through THR Property Management L.P., a wholly owned subsidiary of INVH LP (the “Manager”), we provide all management and other administrative services with respect to the properties we own.

Prior to our initial public offering (“IPO”), we conducted our business through a combination of entities (the “Invitation Homes Partnerships”) formed by Blackstone Real Estate Partners VII L.P.

(“BREP VII”), an investment fund sponsored by The Blackstone Group L.P., along with BREP VII’s affiliated side-by-side funds and co-investment vehicles (“BREP VII and Affiliates”).

During this time, the Invitation Homes Partnerships and INVH LP were under the common control of BREP VII and Affiliates.

BREP VII and Affiliates had the ability to control each of the Invitation Homes Partnerships and manage and operate the Invitation Homes Partnerships through the Manager and a common board of directors.

As such, prior to the IPO our historical financial statements include assets, liabilities, and results of operations of INVH LP and the Invitation Homes Partnerships and their consolidated subsidiaries on a combined and consolidated basis.

In preparation for our IPO, INVH was incorporated in the State of Delaware on October 4, 2016.

From inception through the date of the IPO, INVH did not engage in any business or activity.

Additionally, INVH LP and its general partner Invitation Homes OP GP LLC (the “OP General Partner”) were formed on December 14, 2016, and INVH LP began negotiating and entering into certain debt and hedge instruments upon its inception in anticipation of our IPO.

On February 6, 2017, INVH completed the IPO, changed its jurisdiction of incorporation to Maryland, and amended its charter to provide for the issuance of up to 9,000,000,000 shares of common stock and 900,000,000 shares of preferred stock, $ 0.01 par value per share.

In connection with certain pre-IPO reorganization transactions, INVH LP became (1) owned by INVH directly and through INVH’s wholly owned subsidiary, the OP General Partner, and (2) the owner of all of the assets, liabilities, and operations of the Invitation Homes Partnerships.

On February 6, 2017, INVH completed an initial public offering (“IPO”), changed its jurisdiction of incorporation to Maryland, and amended its charter to provide for the issuance of up to 9,000,000,000 shares of common stock and 900,000,000 shares of preferred stock, in each case $ 0.01 par value per share.

In connection with certain pre-IPO reorganization transactions, INVH LP became (1) owned by INVH directly and through Invitation Homes OP LLC, a wholly owned subsidiary of INVH, and (2) the owner of all of the assets, liabilities, and operations of certain pre-IPO ownership entities.

These transactions were accounted for as a reorganization of entities under common control utilizing historical cost basis.

On November 16, 2017 (the “Merger Date”), INVH and certain of its affiliates entered into a series of transactions with Starwood Waypoint Homes (“SWH”) and certain SWH affiliates which resulted in SWH and its operating partnership being merged into INVH and INVH LP, respectively, with INVH and INVH LP being the surviving entities (the “Mergers”).

The Mergers were accounted for as a business combination in accordance with ASC 805, Business Combinations , and INVH was designated as the accounting acquirer.

The limited partnership interests of INVH LP consist of common units and other classes of limited partnership interests that may be issued (the “OP Units”).

As of December 31, 2020, INVH owns 99.4 % of the common OP Units and has the full, exclusive, and complete responsibility for and discretion over the day to day management and control of INVH LP.

Our organizational structure includes several wholly owned subsidiaries of INVH LP that were formed to facilitate certain of our financing arrangements (the “Borrower Entities”).

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References to “Invitation Homes,” the “Company,” “we,” “our,” and “us” refer, collectively, to INVH, INVH LP, and the consolidated subsidiaries of INVH LP.

References to “SWH” refer to Starwood Waypoint Homes and its subsidiaries.

Merger with Starwood Waypoint Homes

On November 16, 2017 (the “Merger Date”), INVH, INVH LP, IH Merger Sub, LLC, a Delaware limited liability company and direct wholly owned subsidiary of INVH, SWH, and Starwood Waypoint Homes Partnership, L.P., a Delaware limited partnership and a subsidiary of SWH, (“SWH Partnership”) effectuated a series of transactions which resulted in SWH and SWH Partnership being merged into INVH and INVH LP, respectively, with INVH and INVH LP being the surviving entities (the “Mergers”).

In connection with th e Mergers, each outstanding SWH common share was converted into shares of our common stock and each outstanding unit of SWH Partnership was converted into common units of limited partnership interests in INVH LP.

Our limited partnership interests consist of the aforementioned common units and other classes of limited partnership interests that may be issued (the “OP Units”).

As of December 31, 2019 , INVH owns a 99.4 % partnership interest in INVH LP and has the full, exclusive, and complete responsibility for and discretion over the day to day management and control of INVH LP.

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Note 2—Significant Accounting Policies

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The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and with the rules and regulations of the Securities and Exchange Commission.

Subsequent to the date of the pre-IPO reorganization transactions, these consolidated financial statements include the accounts of INVH and its consolidated subsidiaries.

Prior to the date of the pre-IPO reorganization transactions, these consolidated financial statements include the combined accounts of INVH LP and the Invitation Homes Partnerships and their wholly owned subsidiaries.

These consolidated financial statements include the accounts of INVH and its consolidated subsidiaries.

All intercompany accounts and transactions have been eliminated in the consolidated financial statements.

We consolidate entities when we own, directly or indirectly, a majority interest in the entity or are otherwise able to control the entity.

We consolidate variable interest entities (“VIEs”) in accordance with Accounting Standards Codification (“ASC”) 810, Consolidation , if we are the primary beneficiary of the VIE as determined by our power to direct the VIE’s activities and the obligation to absorb its losses or the right to receive its benefits, which are potentially significant to the VIE.

We consolidate variable interest entities (“VIEs”) in accordance with ASC 810, Consolidation , if we are the primary beneficiary of the VIE as determined by our power to direct the VIE’s activities and the obligation to absorb its losses or the right to receive its benefits, which are potentially significant to the VIE.

A VIE is broadly defined as an entity with one or more of the following characteristics:

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or (c) the equity investors have voting rights that are not proportional to their economic interests, and substantially all of the entity’s activities either involve, or are conducted on behalf of, an investor that has disproportionately few voting rights.

As described in Note 5 , as a result of the Mergers we acquired an investment in a joint venture with the Federal National Mortgage Association (“FNMA”), which is a voting interest entity.

We do not hold a controlling financial interest in the joint venture but have significant influence over its operating and financial policies.

Additionally, FNMA holds certain substantive participating rights that preclude the presumption of control by us;

as such, we account for our investment using the equity method.

In connection with the Mergers, we initially recorded this investment at fair value in connection with purchase accounting as described in Note 15 and have subsequently adjusted for our proportionate share of net earnings or losses and other comprehensive income or loss, cash contributions made and distributions received, and other adjustments, as appropriate.

Distributions of operating profit from the joint venture are reported as part of operating cash flows while distributions related to a capital transaction, such as a refinancing transaction or sale, are reported as investing activities in our consolidated statements of cash flows.

Non-controlling interests represent the OP Units held by a third party at the Merger Date and any vested OP Units granted in connection with certain share-based compensation awards.

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As described in Note 5, we invested in joint ventures with Rockpoint Group, L.L.C.

(“Rockpoint”) and the Federal National Mortgage Association (“FNMA”), both of which are voting interest entities.

We do not hold a controlling financial interest in either joint venture but have significant influence over the operating and financial policies of each joint venture.

Additionally, both Rockpoint and FNMA hold certain substantive participating rights that preclude the presumption of control by us of either joint venture;

as such, we account for each investment using the equity method.

Our investment in the Rockpoint joint venture is recorded at cost, and our investment in the FNMA joint venture was initially recorded at fair value in connection with purchase accounting for the Mergers.

The investments in these joint ventures are subsequently adjusted for our proportionate share of net earnings or losses and other comprehensive income or loss, cash contributions made and distributions received, and other adjustments, as appropriate.

Distributions of operating profit from the joint ventures are reported as part of operating cash flows while distributions related to a capital transaction, such as a refinancing transaction or sale, are reported as investing activities.

Non-controlling interests represent the OP Units not owned by INVH, including any vested OP Units granted in connection with certain share-based compensation awards.

Non-controlling interests are presented as a separate component of equity on the consolidated balance sheets as of December 31, 2020 and 2019, and the consolidated statements of operations for the years ended December 31, 2020, 2019, and 2018 include an allocation of the net income (loss) attributable to the non-controlling interest holders.

Vested OP Units are redeemable for shares of our common stock on a one -for-one basis or, in our sole discretion, cash, and redemptions of OP Units are accounted for as a reduction in non-controlling interests with an offset to stockholders’ equity based on the pro rata number of OP Units redeemed.

Adoption of New Accounting Standards

In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842) , (the “New Lease Standard”), which requires lessees to recognize assets and liabilities on the balance sheets for the rights and obligations created by all leases with terms of more than one year.

Lessor accounting remains similar to previous GAAP, while aligning with ASC 606, Revenue from Contracts with Customers (“ASC 606”).

We adopted the New Lease Standard using the optional transition approach as of January 1, 2019.

As such, previously reported financial information was not updated, and additional disclosures required under the New Lease Standard are not provided for periods prior to January 1, 2019.

Additionally, we elected the practical expedient package related to lease identification, lease classification, and initial direct costs.

As such, we have not reassessed our existing contracts and leases for these items.

We did not elect the hindsight practical expedient, which permits entities to use hindsight in determining lease term and assessing impairment.

Significant Risks and Uncertainties

One of the most significant risks and uncertainties to our financial condition and results of operations is the potential adverse effect of the ongoing pandemic resulting from the coronavirus, or COVID-19.

Since the outbreak, a number of our residents have requested rent deferral and/or late fee relief, and components of our rental revenues and other property income have been impacted by the pandemic.

In addition, entities directed by, or notionally affiliated with, the Federal government as well as some state and local jurisdictions across the United States, have imposed temporary eviction moratoriums if certain criteria are met by residents, are allowing residents to defer missed rent payments without incurring late fees, and are prohibiting rent increases.

Jurisdictions and other local and national authorities may expand or extend measures imposing restrictions on our ability to enforce residents’ contractual rental obligations and limiting our ability to increase rents.

We cannot predict if states, municipalities, local, and/or national authorities will expand existing restrictions, if additional states or municipalities will implement similar restrictions, or when restrictions currently in place will expire.

Certain other restrictions imposed by jurisdictions across the United States are intended to limit operations by businesses not deemed “essential businesses.” While none of the current restrictions have materially impacted our ability to provide services to our residents or homes, future measures may negatively impact our ability to access our homes, complete service requests, or make our homes ready for new residents.

The COVID-19 pandemic could have material and adverse effects on our financial condition, results of operations, and cash flows in the near term due to, but not limited to, the following:

(1) reduced economic activity that severely impacts the earnings or health of our residents, thereby causing them to be unable to fully meet their obligations to us and resulting in increases in uncollectible revenues and thus reductions in rental revenues and other property income;

(2) governmental restrictions and moratoriums that negatively impact our ability to charge and collect rental revenues and other property income or impose restrictions on our ability to provide services to our residents and homes;

(3) negative financial impact of the pandemic that could impact our ability to access funds available under our Revolving Facility (as defined in Note 7) or affect future compliance with financial covenants of our Credit Facility (as defined in Note 7) and other debt agreements;

and (4) weaker economic conditions that could cause us to recognize impairments in value of our tangible assets or goodwill.

The extent to which the COVID-19 pandemic ultimately impacts our operations depends on ongoing developments, which remain highly uncertain and cannot be predicted with confidence, including the scope, severity, and duration of the pandemic, the extent and duration of actions taken to contain the pandemic or mitigate its impact, the availability of an effective vaccine and therapeutic drugs and the effectiveness of the distribution of any such vaccines and therapeutic drugs, and the direct and indirect economic effects of the pandemic, containment measures, monetary and/or fiscal policies implemented to provide support or relief to businesses and/or residents, and other government, regulatory, and/or legislative changes precipitated by the COVID-19 pandemic, among others.

While we have taken steps to mitigate the impact of the pandemic on our results of operations, there can be no assurance that these efforts will be successful.

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As a lessor, our leases with residents are classified as operating leases under the New Lease Standard, and thus the pattern of recognition of rental revenue and other property income remains unchanged from previous lease accounting guidance as adjusted by ASC 606.

Rental revenues and other property income are recorded net of any concessions and uncollectible amounts for all periods presented.

As a lessee, adoption of the New Lease Standard resulted in the recognition of right-of-use (“ROU”) assets and lease liabilities for operating leases on our consolidated balance sheet;

however, our accounting for finance leases remains substantially unchanged.

On January 1, 2019, we recorded the cumulative effect of adoption of the New Lease Standard on our consolidated balance sheet which resulted in an increase in other assets and other liabilities of $ 14,118 and $ 14,118 , respectively.

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820):

Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement, which changes the fair value disclosure requirements for certain financial instruments.

This guidance reduces the need for certain disclosure language related to our Level 3 financial instruments and a dds additional disclosure requirements for significant unobservable inputs used in the calculation of fair values of Level 3 financial instruments.

We adopted this standard as of October 1, 2019, and it did not have a material impact on our consolidated financial statements.

Reclassification

As of December 31, 2019, we reclassified the $ 54,778 carrying value of our investment in the FNMA joint venture from other assets, net on the consolidated balance sheet to a separate balance sheet line item, investments in unconsolidated joint ventures, to conform to our current presentation.

Additionally, we reclassified $ 6,480 of unrealized gains on investments in equity securities from other, net into unrealized gains on investments in equity securities for the year ended December 31, 2019 to conform to our current presentation.

This reclassification had no effect on the total reported net income on the consolidated statement of operations for the year ended December 31, 2019.

Adoption of New Accounting Standards

In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-13, Financial Instruments—Credit Losses (Topic 326):

Measurement of Credit Losses on Financial Instruments, which changes how companies measure credit losses for certain financial assets, excluding receivables arising from operating leases.

This guidance requires an entity to estimate its expected credit loss and record an allowance based on this estimate so that it is presented at the net amount expected to be collected on the financial asset.

We adopted this standard as of January 1, 2020, and it did not have a material impact on our consolidated financial statements.

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848 ) (“ASU 2020-04”), which contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives, and other contracts.

The guidance in ASU 2020-04 is optional and may be elected over time as reference rate reform activities occur.

We have elected to apply the hedge accounting expedients related to probability and the assessments of effectiveness for future London Interbank Offer Rate (“LIBOR”) indexed cash flows to assume that the index upon which future hedged transactions will be based matches the index on the corresponding derivatives.

Application of these expedients preserves the presentation of derivatives consistent with past presentation.

We continue to evaluate the impact of the guidance and may apply other elections as applicable as additional changes in the market occur.

In April 2020, the FASB staff issued a question and answer document (the “Lease Modification Q&A”) focused on the application of lease accounting guidance to lease accommodations resulting from the COVID-19 pandemic as many lessors have been asked to provide rent deferrals, rent abatements, late fee waivers, and other lease concessions to lessees (collectively, “lease accommodations”).

While the lease modification guidance in ASC 842, Leases (“ASC 842”), addresses routine changes to lease terms resulting from negotiations between a lessee and lessor, it did not contemplate the rapid implementation of lease accommodations to address the sudden liquidity constraints of some lessees arising from the COVID-19 pandemic.

Under existing lease guidance, we would have been required to determine, on a lease by lease basis, if each lease accommodation resulted from a new arrangement reached with the resident (treated within the lease modification accounting framework) or if each was contemplated under the enforceable rights and obligations within the existing lease agreement (precluded from applying the lease modification accounting framework).

If certain criteria are met, the Lease Modification Q&A allows lessors to bypass the lease by lease analysis and instead elect to either apply the lease modification accounting framework or not, with such election applied consistently to leases with similar characteristics and similar circumstances.

We elected to apply the Lease Modification Q&A guidance not to perform a lease by lease analysis with respect to any lease accommodations and to account for such accommodations outside of the lease modification framework.

The Lease Modification Q&A has not had a material impact on our consolidated financial statements for the year ended December 31, 2020.

However, the extent of lease accommodations granted to residents as a result of the COVID-19 pandemic in future periods may materially affect our consolidated financial statements.

Use of Estimates

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These estimates are inherently subjective in nature and actual results could differ from those estimates.

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Investments in Single-Family Residential Properties

The following significant accounting policies affect the acquisition, disposition, recognition, classification, and fair value measurements (on a nonrecurring basis) related to our portfolio of approximately 80,000 single-family residential properties in 16 markets across the United States as of December 31, 2019 :

The following significant accounting policies affect the acquisition, disposition, recognition, classification, and fair value measurements (on a nonrecurring basis) related to our portfolio of over 80,000 single-family residential properties in 16 markets across the United States as of December 31, 2020:

• Acquisition of Real Estate Assets:

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The capitalization period associated with our stabilization activities begins at the time that such activities commence and concludes at the time that a single-family residential property is available to be leased.

Once a property is ready for its intended use, expenditures for ordinary maintenance and repairs thereafter are expensed to operations as incurred, and we capitalize expenditures that improve or extend the life of a home , a portion of the salaries and benefits of the Manager’s employees who are directly responsible for such improvements,

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and for certain furniture and fixtures additions.

Once a property is ready for its intended use, expenditures for ordinary maintenance and repairs thereafter are expensed to operations as incurred, and we capitalize expenditures that improve or extend the life of a home, a portion of the salaries and benefits of the Manager’s employees who are directly responsible for such improvements, and for certain furniture and fixtures additions.

The determination of which costs to capitalize requires significant judgment.

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To the extent an event or change in circumstance is identified, a residential property is considered to be impaired only if its carrying value cannot be recovered through estimated future undiscounted cash flows from the use and eventual disposition of the property.

Cash flow projections are prepared using internal analyses based on current rental, renewal, and occupancy rates, operating expenses, and inputs from our annual planning process that give consideration to each property’s historical results, current operating trends, and current market conditions.

Cash flow projections are prepared using internal analyses based on current rental, renewal, and occupancy rates, operating expenses, and inputs from our annual planning process that give

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consideration to each property’s historical results, current operating trends, and current market conditions.

To the extent an impairment has occurred, the carrying amount of our investment in a property is adjusted to its estimated fair value.

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As of December 31, 2020 and 2019, we classified $ 44,163 and $ 116,529 , respectively, as held for sale assets in our consolidated balance sheets (see Note 6).

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Cash and Cash Equivalents

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Investments in debt securities that we have a positive intent and ability to hold to maturity are classified as held to maturity and are presented within other assets, net on our consolidated balance sheets (see Note 6).

These investments are recorded at amortized cost.

Investments are reviewed at each reporting period for declines in fair value below the amortized cost basis that are other than temporary.

These investments are recorded at amortized cost net of the amount expected not to be collected.

Interest income, including amortization of any premium or discount, is classified as other in the consolidated statements of operations.

For purposes of classification within the consolidated statements of cash flows, purchases of and repayments from these securities are classified as investing activities.

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Investments in Equity Securities

Investments in equity securities without a readily determinable fair value are presented within other assets, net on our consolidated balance sheets (see Note 5 ).

These investments are measured at cost, less any impairment, plus or minus changes resulting from observable price changes for identical or similar investment in the same issuer.

Investments in equity securities consist of investments both with and without a readily determinable fair value.

These are presented within other assets, net on our consolidated balance sheets (see Note 6).

Investments with a readily determinable fair value are measured at fair value.

Investments without a readily determinable fair value are measured at cost, less any impairment, plus or minus changes resulting from observable price changes for identical or similar investment in the same issuer.

Unrealized gains and losses are included in other, net in the consolidated statements of operations.

Deferred Financing Costs

Costs incurred that are directly attributable to procuring external financing are deferred and amortized over the term of the related financing arrangement as interest expense in the consolidated statements of operations.

Costs incurred that are directly attributable to procuring external financing are deferred and amortized over the term of the related financing agreement as interest expense in the consolidated statements of operations, and we accelerate amortization if the debt is retired before the maturity date.

Costs that are deferred for the procurement of such financing are presented either as an asset in other assets, net when associated with a revolving debt instrument and prior to funding of a loan or as a liability in mortgage loans, net, secured term loan, net, or term loan facility, net, when associated with other indebtedness.

Unamortized financing costs are charged to earnings when debt is retired before the maturity date.

Convertible Senior Notes

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Amortization of this discount is recorded as interest expense in the consolidated statement of operations for the years ended December 31, 2020 , 2019, and 2018.

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Revenue Recognition and Resident Receivables

On January 1, 2019, we adopted ASC 842 which requires lessees to recognize assets and liabilities on the balance sheet for the rights and obligations created by all leases with terms of more than one year.

Lessor accounting remains similar to previous GAAP, while aligning with ASC 606, Revenue from Contracts with Customers (“ASC 606”).

We adopted ASC 842 using the optional transition approach.

As such, previously reported financial information was not updated, and additional disclosures required under ASC 842 are not provided for periods prior to January 1, 2019.

Additionally, we elected the practical expedient package related to lease identification, lease classification, and initial direct costs.

As such, we did not reassess our existing contracts and leases for these items.

We did not elect the hindsight practical expedient, which permits entities to use hindsight in determining lease term and assessing impairment.

Rental revenues and other property income, net of any concessions and uncollectible amounts, consists primarily of rents collected under lease agreements related to our single-family residential properties.

We enter into leases directly with our residents, and our leases typically have a term of one to two years.

We elected the practical expedient not to separate the lease and nonlease components of these operating leases with our residents.

As a lessor, our leases with residents are classified as operating leases under ASC 842.

We elected the practical expedient in ASC 842 not to separate the lease and nonlease components of these operating leases with our residents.

Our lease components consist primarily of rental income, pet rent, and smart home system fees.

Nonlease components include resident reimbursements for utilities and various other fees, including late fees and lease termination fees, among others.

The lease component is the predominant component in these arrangements, and as such, we recognize rental revenues and other property income in accordance with the New Lease Standard for the year ended December 31, 2019 , and in accordance with previous GAAP for the years ended December 31, 2018 and 2017 .

The lease component is the predominant component in these

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arrangements, and as such, we recognize rental revenues and other property income in accordance with ASC 842 for the years ended December 31, 2020 and 2019, and in accordance with previous GAAP for the year ended December 31, 2018.

Variable lease payments consist of resident reimbursements for utilities, and various other fees, including late fees and lease termination fees, among others.

Variable lease payments are charged based on the terms and conditions included in the resident leases.

For the year ended December 31, 2019 , rental revenues and other property income includes $ 92,759 of variable lease payments.

Sales taxes and other similar taxes assessed by governmental authorities that we collect from residents are excluded from our rental revenues and other property income.

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We lease our corporate and regional offices, related office equipment, and a fleet of vehicles for use by our field associates.

As of January 1, 2019, these leases are accounted for pursuant to the New Lease Standard (see Note 5 and Note 14 ).

As of January 1, 2019, these leases are accounted for pursuant to ASC 842 (see Note 6 and Note 14).

Prior to adoption of ASC 842, these leases were accounted for in accordance with previous GAAP.

We account for leases for our corporate and regional offices as operating leases.

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Such amounts are not included in the measurement of the lease liability but are recognized as a variable lease expense when incurred.

At this time, it is not reasonably certain that we will exercise any of the renewal or termination options on these leases, and the measurement of the ROU asset and lease liability is calculated accordingly.

At this time, it is not reasonably certain that we will exercise any of the future renewal or termination options on these leases, and the measurement of the right-of-use (“ROU”) asset and lease liability is calculated assuming we will not exercise any of the remaining renewal or termination options.

We have elected the practical expedient under which the lease components of our office and vehicle fleet leases are not separated from the nonlease components.

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As of December 31, 2020 , no impairment of goodwill has been recorded.

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Fair Value Measurements

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Level 1—Inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets;

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Level 2—Inputs to the valuation methodology include quoted prices for similar assets or liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument;

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The two-class method is an earnings allocation formula that determines EPS for each class of common stock and participating securities according to dividends or dividend equivalents and participation rights in undistributed earnings in periods when we have net income.

Prior to the IPO, our business was conducted through the Invitation Homes Partnerships, which did not have a common capital structure upon which to compute historical EPS.

Accordingly, EPS has not been presented for historical periods prior to the IPO.

We enter into interest rate swap and interest rate cap agreements (collectively, “Hedging Derivatives”) for interest rate risk management purposes.

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Pursuant to the terms of certain of our mortgage loans, we are required to maintain interest rate caps.

Additionally, in certain instances, in order to minimize the cash impact of purchasing required interest rate caps, we simultaneously sell interest rate caps (which have identical terms and notional amounts) such that the purchase price and sale proceeds of the

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related interest rate caps are intended to offset each other.

We have elected not to designate these interest cap agreements for hedge accounting (collectively, the “Non-Designated Hedges”).

We enter into interest rate swap agreements to hedge the risk arising from changes in our interest payments on variable-rate debt due to changes in the one-month London Interbank Offered Rate (“LIBOR”) (or a comparable or successor rate).

We enter into interest rate swap agreements to hedge the risk arising from changes in our interest payments on variable-rate debt due to changes in the one-month LIBOR (or a comparable or successor rate).

We have elected to account for our interest rate swap agreements as effective cash flow hedges (collectively, the “Designated Hedges”).

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See Note 8 for further discussion of derivative financial instruments.

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Share-Based Compensation Expense

Prior to the IPO, we recognized share-based compensation expense for incentive compensation units granted by the Invitation Homes Partnerships (the “Class B Units”), all of which were canceled or converted into other interests in connection with the IPO (see Note 10 ).

Subsequent to the IPO, we have issued shared-based awards that settle in shares of common stock.

We recognize share-based compensation expense for share-based awards based on their grant-date fair value, net of expected forfeitures, over the service period from the grant date to vest date for each tranche.

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However, the grant-date fair values for PRSUs and Outperformance Awards with market condition vesting criteria are based on Monte-Carlo option pricing models.

Compensation expense for shared-based awards with performance conditions is adjusted based on the probable outcome of the performance conditions as of each reporting period.

Compensation expense for share-based awards with performance conditions is adjusted based on the probable outcome of the performance conditions as of each reporting period.

Additional compensation expense is recognized if modifications to existing share-based award agreements result in an increase in the post-modification fair value of the units that exceeds their pre-modification fair value.

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See Note 10 for further discussion of share-based compensation expense.

Prior to the IPO, we conducted our business through a group of six affiliated holding entities (the “Invitation Homes Partnerships”).

As a result of the pre-IPO reorganization transactions, the following occurred:

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We intend to continue to operate as a REIT, and our current and continuing qualification as a REIT depends on our ability to meet the various requirements imposed by the Internal Revenue Code of 1986, as amended (the “Code”), which are related to organizational structure, distribution levels, diversity of stock ownership and certain restrictions with regard to owned assets and categories of income.

If we qualify for taxation as a REIT, we will generally not be subject to United States federal corporate income tax on our taxable income that is currently distributed to stockholders.

While we qualify for taxation as a REIT, we will generally not be subject to United States federal corporate income tax on our taxable income that is currently distributed to stockholders.

This treatment substantially eliminates the “double taxation” (at the corporate and stockholder levels) that generally results from an investment in a corporation.

If we fail to qualify as a REIT in any taxable year, we will be subject to United States federal income taxes at regular corporate rates (including, for taxable years beginning prior to January 1, 2018, any applicable alternative minimum tax) and may not be able to qualify as a REIT for subsequent taxable years.

If we fail to qualify as a REIT in any taxable year, we will be subject to United States federal income taxes at regular corporate rates and may not be able to qualify as a REIT for subsequent taxable years.

Even if we qualify as a REIT, we may be subject to United States federal income and excise taxes in various situations, such as on our undistributed income.

We also will be required to pay a 100% tax on any net income on non-arm’s length transactions between us and a TRS, defined below, and on any net income from sales of assets that were held for sale to customers in the ordinary course.

In addition, for taxable years beginning prior to January 1, 2018, we could also be subject to the alternative minimum tax on items of tax preference.

State and local tax laws may not conform to the United States

INVITATION HOMES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

federal income tax treatment, and we may be subject to state or local taxation in various state or local jurisdictions, including those in which we transact business.

State and local tax laws may not conform to the United States federal income tax treatment, and we may be subject to state or local taxation in various state or local jurisdictions, including those in which we transact business.

Any taxes imposed on us reduce our operating cash flow and net income.

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For our TRS entities, deferred income taxes result from temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for United States federal income tax purposes and are measured using the enacted tax rates and laws that are expected to be in effect when the differences reverse.

We reduce deferred tax assets by recording a valuation allowance when we determine, based on available evidence, that it is more likely than not that the assets will not be realized.

INVITATION HOMES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

deferred tax assets by recording a valuation allowance when we determine, based on available evidence, that it is more likely than not that the assets will not be realized.

We recognize the tax consequences associated with intercompany transfers between the REIT and TRS entities when the related assets affect our net income or loss, generally through depreciation, impairment losses, or sales to third party entities.

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Our CODM is the Chief Executive Officer.

Under the provision of ASC 280, Segment Reporting , we have determined that we have one reportable segment related to acquiring, renovating, leasing, and operating single-family homes as rental properties.

Under the provisions of ASC 280, Segment Reporting , we have determined that we have one reportable segment related to acquiring, renovating, leasing, and operating single-family homes as rental properties.

The CODM evaluates operating performance and allocates resources on a total portfolio basis.

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Recent Accounting Pronouncements

In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326):

Measurement of Credit Losses on Financial Instruments, which changes how companies will measure credit losses for certain financial assets, excluding receivables arising from operating leases.

In August 2020, the FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”), which simplifies an issuer’s accounting for convertible instruments and contracts in its own equity.

The guidance reduces the number of accounting models for convertible instruments, requires entities to use the “if-converted” method in diluted EPS, and requires that the effect of potential share settlement be included in the diluted EPS calculation when an instrument may be settled in cash or shares.

The new standard will be effective for annual reporting periods beginning after December 15, 2021, and interim periods within that reporting period, with early adoption permitted beginning after December 15, 2020 and interim periods within that reporting period.

We do not anticipate the adoption of this standard to have a material impact on our consolidated financial statements.

INVITATION HOMES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

Our 2022 Convertible Notes (as defined in Note 7) are the only instruments we have that will be subject to ASU 2020-06, and these notes mature on January 15, 2022.

As such, ASU 2020-06 will not materially affect our consolidated financial statements.

Note 3—Investments in Single-Family Residential Properties

The following table sets forth the net carrying amount associated with our properties by component:

December 31, 2020 December 31, 2019

Land $ 4,539,796 $ 4,499,346

Single-family residential property 13,631,859 13,121,179

Capital improvements 515,479 513,269

Equipment 114,616 113,370

Total gross investments in the properties 18,801,750 18,247,164

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Investments in single-family residential properties, net $ 16,288,693 $ 16,243,192

INVITATION HOMES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

As of December 31, 2020 and 2019, the carrying amount of the residential properties above includes $ 119,929 and $ 119,608 , respectively, of capitalized acquisition costs (excluding purchase price), along with $ 68,197 and $ 65,747 , respectively, of capitalized interest, $ 26,899 and $ 25,565 , respectively, of capitalized property taxes, $ 4,654 and $ 4,616 , respectively, of capitalized insurance, and $ 3,090 and $ 2,836 , respectively, of capitalized HOA fees.

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Further, during the years ended December 31, 2020, 2019, and 2018, impairments totaling $ 4,578 , $ 14,210 , and $ 6,709 , respectively, have been recognized and are included in impairment and other in the consolidated statements of operations.

See Note 11 for additional information regarding these impairments.

Note 4—Cash, Cash Equivalents, and Restricted Cash

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported on the consolidated balance sheets that sum to the total of such amounts shown in the consolidated statements of cash flows:

December 31, 2019

December 31, 2018

December 31, 2020 December 31, 2019

Cash and cash equivalents

$ 213,422 $ 92,258

Restricted cash

198,346 193,987

Total cash, cash equivalents, and restricted cash shown in the consolidated statements of cash flows $ 411,768 $ 286,245

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The amounts funded, and to be funded, to the reserve accounts are subject to formulae included in the mortgage loan and Secured Term Loan agreements and are to be released to us subject to certain conditions specified in the loan agreements being met.

To the extent that an event of default were to occur, the loan servicer has discretion to use such funds to either

settle the applicable operating expenses to which such reserves relate or reduce the allocated loan amount associated with a residential property of ours.

To the extent that an event of default were to occur, the loan servicer has discretion to use such funds to either settle the applicable operating expenses to which such reserves relate or reduce the allocated loan amount associated with a residential property of ours.

The balances of our restricted cash accounts, as of December 31, 2020 and 2019, are set forth in the table below.

As of December 31, 2020 and 2019, no amounts were funded to the insurance accounts as the conditions specified in the mortgage loan and Secured Term Loan agreements that require such funding did not exist.

December 31, 2020 December 31, 2019

Resident security deposits $ 158,244 $ 148,186

Collections 22,978 24,034

Property taxes 7,511 10,443

2 unchanged sentences

Special and other reserves 1,374 2,238

Total $ 198,346 $ 193,987

INVITATION HOMES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

Note 5—Investments In Unconsolidated Joint Ventures

We have invested in two joint ventures which are accounted for using the equity method model of accounting.

The following table summarizes our investments in unconsolidated joint ventures as of December 31, 2020 and 2019:

Number of Properties Carrying Value

Ownership Percentage December 31, 2020 December 31, 2019 December 31, 2020 December 31, 2019

10 % 571 641 $ 53,678 $ 54,778

Rockpoint (2)

20 % 140 — 15,589 —

Total $ 69,267 $ 54,778

(1) Contains homes primarily located in Arizona, California, and Nevada.

(2) Contains homes in markets within the Western United States, Southeast United States, Florida, and Texas.

In October 2020, we entered into an agreement with Rockpoint to form a joint venture that will acquire homes in markets where we already own homes.

As of December 31, 2020, we are committed to fund an additional $ 59,400 to the joint venture.

For the years ended December 31, 2020, 2019, and 2018, we recorded of $ 599 , $ 1,668 , and $ 596 , respectively, of income from investments in unconsolidated joint ventures which is included in other, net in the accompanying consolidated statements of operations.

The administrative manager of Rockpoint and the managing member of FNMA are wholly owned subsidiaries of INVH LP and are responsible for the operations and management of the properties, subject to Rockpoint and FNMA’s respective approval of major decisions.

The subsidiaries earn asset and property management fees from our joint ventures, which are considered to be related parties.

For the years ended December 31, 2020, 2019, and 2018, we earned $ 2,585 , $ 2,823 , and $ 2,834 , respectively, of management fees which are included in other, net in the accompanying consolidated statements of operations.

INVITATION HOMES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

Note 6—Other Assets

As of December 31, 2020 and 2019, the balances in other assets, net are as follows:

December 31, 2020 December 31, 2019

Investments in debt securities, net $ 245,237 $ 316,991

Investments in equity securities 47,189 16,650

Held for sale assets (1)

Investment in unconsolidated joint venture

44,163 116,529

Prepaid expenses 41,347 32,106

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ROU lease assets — operating and finance, net 21,705 13,768

Deferred financing costs, net 11,637 2,765

Corporate fixed assets, net 9,995 9,825

Deferred leasing costs, net 7,631 7,427

Deferred financing costs, net

Derivative instruments (Note 7)

Amounts deposited and held by others 2,852 1,348

Derivative instruments (Note 8) 1 1,643

Other 11,274 6,192

Total $ 478,287 $ 550,488

(1) As of December 31, 2020 and 2019, 179 and 478 properties, respectively, are classified as held for sale.

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These investments in debt securities are classified as held to maturity investments.

As of December 31, 2019 and 2018 , there were no gross unrecognized holding gains or losses, and there were no other than temporary impairments recognized in accumulated other comprehensive loss.

As of December 31, 2019 , our retained certificates are scheduled to mature over the next two months to eight years .

As of December 31, 2020, we have not recognized any credit losses with respect to these investments in debt securities.

As of December 31, 2019, there were no gross unrecognized holding gains or losses, and there were no other than temporary impairments recognized in accumulated other comprehensive loss.

As of December 31, 2020, our retained certificates are scheduled to mature over the next one month to seven years .

Investments in Equity Securities

We hold investments in equity securities both with and without a readily determinable fair value.

Investments with a readily determinable fair value are measured at fair value.

As of December 31, 2020 and 2019, the values of our investments in equity securities are as follows:

December 31, 2020 December 31, 2019

Investments with a readily determinable fair value $ 46,339 $ —

Investments without a readily determinable fair value 850 16,650

Total $ 47,189 $ 16,650

INVITATION HOMES INC.

1 unchanged sentence

(dollar amounts in thousands)

Investment in Unconsolidated Joint Venture

We own a 10 % interest in a joint venture with FNMA to operate, lease, and manage a portfolio of properties primarily located in Arizona, California, and Nevada.

A wholly owned subsidiary of INVH LP is the managing member of the joint venture and is responsible for the operation and management of the properties, subject to FNMA’s approval of major decisions.

As of December 31, 2019 and 2018 , the joint venture owned 641 and 754 properties, respectively.

During the year ended December 31, 2020, we determined a readily determinable fair value became available for one of our investments in equity securities without a readily determinable fair value, and we began treating the investment as an investment with a readily determinable value.

For the year ended December 31, 2020, we recognized $ 29,689 of unrealized gains on our investments in equity securities with a readily determinable fair value.

For the years ended December 31, 2020 and 2019, we recorded $ 34 and $ 6,480 of unrealized gains on our investments in equity securities without a readily determinable fair value, respectively.

No unrealized gains or losses were recorded during the year ended December 31, 2018.

Rent and Other Receivables

We lease our properties to residents pursuant to leases that generally have an initial contractual term of at least 12 months, provide for monthly payments, and are cancelable by the resident and us under certain conditions specified in the related lease agreements.

Rental revenues and other property income and the corresponding rent and other receivables are recorded net of any concessions and bad debt (including actual write-offs, credit reserves, and uncollectible amounts) for all periods presented.

Variable lease payments consist of resident reimbursements for utilities, and various other fees, including late fees and lease termination fees, among others.

Variable lease payments are charged based on the terms and conditions included in the resident leases.

For the years ended December 31, 2020 and 2019, rental revenues and other property income includes $ 91,573 and $ 92,759 of variable lease payments, respectively.

Future minimum rental revenues and other property income under leases existing on our single-family residential properties as of December 31, 2020 are as follows:

Year Lease Payments to be Received

2021 $ 1,028,387

Total $ 1,156,337

ROU Lease Assets — Operating and Finance, net

The following table presents supplemental information related to leases into which we have entered as a lessee as of December 31, 2019 :

December 31, 2019

Other liabilities

Weighted average remaining lease term

The following table presents supplemental information related to leases into which we have entered as a lessee as of December 31, 2020 and 2019:

December 31, 2020 December 31, 2019

Other assets $ 12,942 $ 8,763 $ 12,552 $ 1,216

Other liabilities (Note 14) 15,988 8,389 13,787 1,210

Weighted average remaining lease term 4.0 years 3.1 years 3.8 years 2.0 years

Weighted average discount rate 3.5 % 4.0 % 4.0 % 4.0 %

During the year ended December 31, 2020, we recorded $ 1,750 of impairment on one of our ROU lease assets in other, net in the consolidated statements of operations.

We did not record any impairment on our ROU lease assets for the year ended December 31, 2019.

See Note 11 for additional information regarding this impairment.

INVITATION HOMES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

Deferred Financing Costs, net

In connection with our Revolving Facility (as defined in Note 6 ), we incurred $ 9,673 of financing costs during the year ended December 31, 2017 , which have been deferred as other assets, net on our consolidated balance sheets.

These deferred financing costs are being amortized as interest expense on a straight-line basis over the term of the Revolving Facility.

During the year ended December 31, 2020, we incurred $ 11,832 of financing costs which have been deferred as other assets, net on our consolidated balance sheets.

These costs were incurred in connection with a new amended and restated Revolving Facility (see Note 7).

We amortize deferred financing costs as interest expense on a straight-line basis over the term of the related financing agreement and accelerate amortization if the debt is retired before the maturity date.

The $ 2,765 of deferred financing costs as of December 31, 2019 were related to a previous revolving facility that was repaid in full during the year ended December 31, 2020.

As of December 31, 2020 and 2019, the unamortized balances of these deferred financing costs are $ 11,637 and $ 2,765 , respectively.

Investment in Equity Securities

On May 15, 2018, a convertible promissory note that we acquired on March 12, 2018 converted into equity securities without a readily determinable fair value.

We have elected to measure the investment at cost, less any impairment, plus or minus changes resulting from observable price changes for an identical or similar investment in the same issuer.

As of December 31, 2019 and 2018 , the carrying amount of our investment in equity securities was $ 16,650 and $ 10,170 , respectively, and is included within other in the table above.

During the year ended December 31, 2019 , we recorded $ 6,480 of unrealized gains on our investment in equity securities which is included in other, net in the consolidated statement of operations.

No unrealized gains or losses were recorded during the year ended December 31, 2018 .

Note 6 — Debt

Mortgage Loans

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Outstanding Principal

Maturity Date

if Fully Extended (2)

Range of Spreads (4)

December 31, 2020 December 31, 2019

IH 2017-1 (6)

April 28, 2017

2027 4.23 % N/A $ 994,787 $ 995,520

SWH 2017-1 (7)

September 29,

October 9, 2020

2017 December 9,

2020 N/A — % N/A — 744,092

IH 2017-2 (7)

November 9, 2017

2017 December 9,

2021 December 9,

2024 1.29 % 91-186 bps 612,506 624,475

IH 2018-1 (7)(8)

February 8, 2018

2018 March 9,

2021 March 9,

2025 1.09 % 76-151 bps 646,021 793,720

IH 2018-2 (7)

2025 1.23 % 95-150 bps 693,988 957,135

IH 2018-3 (7)

June 28, 2018

2025 1.42 % 105-205 bps 1,036,561 1,213,035

IH 2018-4 (7)(9)

November 7, 2018

2018 January 9,

2021 January 9,

2026 1.49 % 115-200 bps 848,270 938,430

Total Securitizations 4,832,133 6,266,407

deferred financing costs, net

( 12,035 ) ( 27,946 )

Total $ 4,820,098 $ 6,238,461

(1) Maturity date represents repayment date for mortgage loans which have been repaid in full prior to December 31, 2020.

For all other mortgage loans, the maturity dates above reflect all extensions that have been exercised.

For all other mortgage loans, the maturity dates above reflect all extension options that have been exercised.

(2) Represents the maturity date if we exercise each of the remaining one year extension options available, which are subject to certain conditions being met.

(3) Except for IH 2017-1, interest rates are based on a weighted average spread over LIBOR (or a comparable or successor rate as provided for in our loan agreements), plus applicable servicing fees;

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(6) Net of unamortized discount of $ 2,289 and $ 2,641 as of December 31, 2020 and 2019, respectively.

The initial maturity term of each of these mortgage loans is two years , individually subject to three to five , one year extension options at the Borrower Entity’s discretion (provided that there is no continuing event of default under the mortgage loan agreement and the Borrower Entity obtains and delivers a replacement interest rate cap agreement from an approved counterparty within the required timeframe to the lender ).

Our SWH 2017-1 and IH 2017-2 mortgage loans have exercised the first extension option.

The maturity dates above reflect all extensions that have been exercised.

On December 3, 2019, we submitted a notification to request an extension of the maturity of the IH 2018-1 mortgage loan from March 9, 2020 to March 9, 2021 upon approval.

On February 7, 2020 , we made voluntary prepayments of $ 15,000 and $ 60,000 on outstanding borrowings with unrestricted cash on hand against the outstanding balances of IH 2018-2 and IH 2018-3, respectively (see Note 17 ).

INVITATION HOMES INC.

1 unchanged sentence

(dollar amounts in thousands)

(7) The initial maturity term of each of these mortgage loans is two years , individually subject to three to five , one year extension options at the Borrower Entity’s discretion (provided that there is no continuing event of default under the mortgage loan agreement and the Borrower Entity obtains and delivers a replacement interest rate cap agreement from an approved counterparty within the required timeframe to the lender).

Our IH 2018-1, IH 2018-2, and IH 2018-3 mortgage loans have exercised the first extension option, and our IH 2017-2 mortgage loan has exercised the second extension option.

The maturity dates above reflect all extensions that have been exercised.

(8) On December 1, 2020, we submitted a notification to request an extension of the maturity date of the IH 2018-1 mortgage loan from March 9, 2021 to March 9, 2022.

(9) On January 9, 2021, the extension of the maturity date of the IH 2018-4 mortgage loan from January 9, 2021 to January 9, 2022 was approved by the lender (see Note 15).

Securitization Transactions

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We have evaluated our interests in certain certificates of the Trusts held by us (discussed below) and determined that they do not create a more than insignificant variable interest in the Trusts.

Additionally, the retained certificates do not provide us with any ability to direct the activities that could impact the Trusts’ economic performance.

Additionally, the retained certificates do not provide us with any ability to direct activities that could impact the Trusts’ economic performance.

Therefore, we do not consolidate the Trusts.

Retained Certificates

As the Trusts made Certificates available for sale to both domestic and foreign investors, sponsors of the mortgage loans are required to retain a portion of the risk that represents a material net economic interest in each loan pursuant to Regulation RR (the “Risk Retention Rules”) under the Securities Exchange Act of 1934, as amended.

As such, loan sponsors are required to retain a portion of the credit risk that represents not less than 5 % of the aggregate fair value of the loan as of the closing date.

To fulfill these requirements, Class G certificates for CSH 2016-2 were issued in an amount equal to 5 % of the original principal amount of the loans.

Per the terms of the CSH 2016-2 mortgage loan agreement, the Class G certificates were restricted certificates that were made available exclusively to the sponsor.

We retained these Class G certificates during the time the related Securitization was outstanding, and they were principal only, bearing a stated interest rate of 0.0005 % .

INVITATION HOMES INC.

1 unchanged sentence

(dollar amounts in thousands)

For IH 2017-1, the Class B certificates are restricted certificates that were made available exclusively to INVH LP in order to comply with the Risk Retention Rules.

Retained Certificates

As such, loan sponsors are required to retain a portion of the credit risk that represents not less than 5 % of the aggregate fair value of the loan as of the closing date.

IH 2017-1 issued Class B certificates, which are restricted certificates that were made available exclusively to INVH LP in order to comply with the Risk Retention Rules.

The Class B certificates bear a stated annual interest rate of 4.23 %, including applicable servicing fees.

12 unchanged sentences

For the years ended December 31, 2020, 2019, and 2018, we made voluntary and mandatory prepayments of $ 1,434,626 , $ 997,421 , and $ 4,579,594 , respectively, under the terms of the mortgage loan agreements.

During the year ended December 31, 2020, prepayments included the full repayment of the SWH 2017-1 mortgage loan.

During the year ended December 31, 2019, prepayments included the full repayment of the CSH 2016-2 mortgage loan.

During the year ended December 31, 2018, prepayments included full repayment of the CAH 2014-1, CAH 2014-2, CAH 2015-1, CSH 2016-1, IH 2015-1, IH 2015-2, and IH 2015-3 mortgage loans.

During the year ended December 31, 2017 , prepayments included the full repayment of the IH 2013-1, IH 2014-1, IH 2014-2, and IH 2014-3 mortgage loans.

INVITATION HOMES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

Secured Term Loan

7 unchanged sentences

and (iv) general corporate purposes.

INVITATION HOMES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

The following table sets forth a summary of our Secured Term Loan indebtedness as of December 31, 2020 and 2019:

December 31, 2020 December 31, 2019

Secured Term Loan

June 9, 2031 3.59 % $ 403,363 $ 403,464

Deferred financing costs, net

( 2,268 ) ( 2,486 )

Secured Term Loan, net

$ 401,095 $ 400,978

(1) The Secured Term Loan bears interest at a fixed rate of 3.59 % per annum including applicable servicing fees for the first 11 years and for the twelfth year bears interest at a floating rate based on a spread of 147 bps over one month LIBOR (or a comparable or successor rate as provided for in our loan agreement), including applicable servicing fees, subject to certain adjustments as outlined in the loan agreement.

Interest payments are made monthly.

As of December 31, 2019 , a total of 3,333 homes with a net book value of $ 734,759 are included in the Secured Term Loan’s collateral pool.

The Secured Term Loan’s collateral pool contains 3,332 and 3,333 homes, respectively, as of December 31, 2020 and 2019, with a net book value of $ 719,762 and $ 734,759 , respectively.

2019-1 IH Borrower has the right, subject to certain requirements and limitations outlined in the loan agreement, to substitute properties representing up to 20 % of the collateral pool annually, and to substitute properties representing up to 100 % of the collateral pool over the life of the Secured Term Loan.

3 unchanged sentences

The Secured Term Loan requires 2019-1 IH Borrower to maintain compliance with certain affirmative and negative covenants.

Affirmative covenants include 2019-1 IH Borrower’s, and certain of its affiliates’, compliance with (i) licensing, permitting and legal requirements specified in the mortgage loan agreements, (ii) organizational requirements of the jurisdictions in which they are organized, (iii) federal and state tax laws, and (iv) books and records requirements specified in the respective mortgage loan agreements.

Affirmative covenants include 2019-1 IH Borrower’s, and certain of its affiliates’, compliance with (i) licensing, permitting and legal requirements specified in the loan agreement, (ii) organizational requirements of the jurisdictions in which they are organized, (iii) federal and state tax laws, and (iv) books and records requirements specified in the loan agreement.

Negative covenants include 2019-1 IH Borrower’s, and certain of its affiliates’, compliance with limitations surrounding (i) the amount of 2019-1 IH Borrower’s indebtedness and the nature of its investments, (ii) the execution of transactions with affiliates, (iii) the Manager, (iv) the nature of 2019-1 IH Borrower’s business activities, and (v) the required maintenance of specified cash reserves.

As of December 31, 2020, and through the date our consolidated financial statements were issued, we believe 2019-1 IH Borrower is in compliance with all affirmative and negative covenants.

Prepayments of the Secured Term Loan are generally not permitted unless such prepayments are made pursuant to the voluntary election or mandatory provisions specified in the loan agreement.

The specified mandatory provisions become effective to the extent that a property becomes characterized as a disqualified property, a property is sold, and/or upon the occurrence of a condemnation or casualty event associated with a property.

To the extent either a voluntary election is made, or a mandatory prepayment condition exists, in addition to paying all interest and principal, we must also pay certain breakage costs as determined by the loan servicer and a yield maintenance premium if prepayment occurs before June 9, 2030.

As of December 31, 2019 , no such prepayments have been made.

INVITATION HOMES INC.

1 unchanged sentence

(dollar amounts in thousands)

Prepayments of the Secured Term Loan are generally not permitted unless such prepayments are made pursuant to the voluntary election or mandatory provisions specified in the loan agreement.

For the year ended December 31, 2020, we made mandatory prepayments of $ 101 .

No prepayments were made for the year ended December 31, 2019.

Term Loan Facility and Revolving Facility

On February 6, 2017, we entered into a credit agreement with a syndicate of banks, financial institutions, and institutional lenders for a credit facility (the “Credit Facility”), which was amended on December 18, 2017 to include entities and homes acquired in the Mergers.

The Credit Facility provides $ 2,500,000 of borrowing capacity and consists of a $ 1,000,000 revolving facility (the “Revolving Facility”), which will mature on February 6, 2021, with a one year extension option, and a $ 1,500,000 term loan facility (the “Term Loan Facility”), which will mature on February 6, 2022.

The Revolving Facility also includes borrowing capacity available for letters of credit and for short-term borrowings referred to as swing line borrowings, in each case subject to certain sublimits.

The Credit Facility provides us with the option to enter into additional incremental credit facilities (including an uncommitted incremental facility that provides us with the option to increase the size of the Revolving Facility and/or the Term Loan Facility by an aggregate amount of up to $ 1,500,000 ) , subject to certain limitations.

Proceeds from the Term Loan Facility were used to repay then-outstanding indebtedness and for general corporate purposes.

On December 8, 2020, we entered into an Amended and Restated Revolving Credit and Term Loan Agreement with a syndicate of banks, financial institutions, and institutional lenders for a new credit facility (the “Credit Facility”).

The Credit Facility provides $ 3,500,000 of borrowing capacity and consists of a $ 1,000,000 revolving facility (the “Revolving Facility”) and a $ 2,500,000 term loan facility (the “Term Loan Facility”), both of which mature on January 31, 2025, with two six month extension options available.

The Revolving Facility also includes borrowing capacity for letters of credit.

The Credit Facility provides us with the option to enter into additional incremental credit facilities (including an uncommitted incremental facility that provides us with the option to increase the size of the Revolving Facility and/or the Term Loan Facility such that the aggregate amount does not exceed at any time $ 4,000,000 ), subject to certain limitations.

The Credit Facility replaced a credit facility that consisted of a $ 1,000,000 revolving facility (the “2017 Revolving Facility”) and a $ 1,500,000 term loan facility (the “2017 Term Loan Facility” and together with the 2017 Revolving Facility, the “2017 Credit Facility”).

The terms and conditions of the Credit Facility are consistent with those of the 2017 Credit Facility unless otherwise noted below.

Proceeds from the Term Loan Facility were used to repay then-outstanding indebtedness, including the 2017 Term Loan Facility.

Proceeds from the Revolving Facility are used for general corporate purposes.

The following table sets forth a summary of the outstanding principal amounts under the Credit Facility as of December 31, 2019 and 2018 :

The following table sets forth a summary of the outstanding principal amounts under the Credit Facility and 2017 Credit Facility as of December 31, 2020 and 2019, respectively:

Date Interest

December 31, 2020 December 31, 2019

Term Loan Facility (2)

February 6, 2022

January 31, 2025 1.79 % $ 2,500,000 $ 1,500,000

Deferred financing costs, net

( 29,093 ) ( 6,253 )

Term Loan Facility, net

$ 2,470,907 $ 1,493,747

Revolving Facility (2)

February 6, 2021

January 31, 2025 1.84 % $ — $ —

(1) Interest rates for the Term Loan Facility and the Revolving Facility are based on LIBOR plus an applicable margin.

As of December 31, 2020, the applicable margins were 1.65 % and 1.70 % respectively, and LIBOR was 0.14 %.

(2) If we exercise the two six month extension options, the maturity date will be January 31, 2026.

Interest Rate and Fees

Borrowings under the Credit Facility bear interest, at our option, at a rate equal to a margin over either (a) a LIBOR rate determined by reference to the Bloomberg LIBOR rate (or a comparable or successor rate as provided for in our loan agreement) for the interest period relevant to such borrowing, or (b) a base rate determined by reference to the highest of (1) the administrative agent’s prime lending rate, (2) the federal funds effective rate plus 0.50 %, and (3) the LIBOR rate that would be payable on such day for a LIBOR rate loan with a one month interest period plus 1.00 %.

The margin is based on a total leverage based grid.

The margin for the Revolving Facility ranges from 0.75 % to 1.30 % in the case of base rate loans, and 1.75 % to 2.30 % in the case of LIBOR rate loans.

The margin for the Term Loan Facility ranges from 0.70 % to 1.30 % in the case of base rate loans, and 1.70 % to 2.30 % in the case of LIBOR rate loans.

In addition, the Credit Facility provides that, upon receiving an investment grade rating on its non-credit enhanced, senior unsecured long term debt of BBB- or better from Standard & Poor’s Rating Services, a division of The McGraw-Hill Companies, Inc., or Baa3 or better from Moody’s Investors Service, Inc.

(an “Investment Grade Rating Event”), we may elect to convert to a credit rating based pricing grid.

In addition to paying interest on outstanding principal under the Credit Facility, we are required to pay a facility fee to the lenders under the Revolving Facility in respect of the unused commitments thereunder.

The facility fee rate is based on the daily unused amount of the Revolving Facility and is either 0.35 % or 0.20 % per annum based on the unused facility amount.

Upon converting to a credit rating pricing based grid, the unused facility fee will no longer apply and we will be required to pay a facility fee ranging from 0.125 % to 0.300 % .

The margin is based on a

INVITATION HOMES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

total leverage based grid.

The margins for the Term Loan Facility, Revolving Facility, 2017 Term Loan Facility, and 2017 Revolving Facility are as follows:

Base Rate Loans LIBOR Rate Loans

Term Loan Facility 0.45 % — 1.15 % 1.45 % — 2.15 %

Revolving Facility 0.50 % — 1.15 % 1.50 % — 2.15 %

2017 Term Loan Facility 0.70 % — 1.30 % 1.70 % — 2.30 %

2017 Revolving Facility 0.75 % — 1.30 % 1.75 % — 2.30 %

The margins for the Term Loan Facility and Revolving Facility under the credit rating based pricing grid are as follows:

Base Rate Loans LIBOR Rate Loans

Term Loan Facility — % — 0.65 % 0.80 % — 1.65 %

Revolving Facility — % — 0.45 % 0.75 % — 1.45 %

The Credit Facility also includes a sustainability component whereby the Revolving Facility pricing can improve upon the Company’s achievement of certain sustainability ratings, determined via an independent third party evaluation.

This sustainability feature was not included in the 2017 Revolving Facility.

In addition to paying interest on outstanding principal under the Credit Facility, we are required to pay an unused facility fee to the lenders under the Revolving Facility in respect of the unused commitments thereunder.

The unused facility fee rate is based on the daily unused amount of the Revolving Facility and is either 0.30 % or 0.20 % per annum based on the unused facility amount.

The unused facility fee rate for the 2017 Revolving Facility was 0.35 % or .20 % per annum based on the unused facility amount.

Upon conversion to a credit rating pricing based grid, the unused facility fee will no longer apply and we will be required to pay a facility fee ranging from 0.10 % to 0.30 %.

We are also required to pay customary letter of credit fees.

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Once repaid, no further borrowings will be permitted under the Term Loan Facility.

INVITATION HOMES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

Loan Covenants

The Credit Facility contains certain customary affirmative and negative covenants and events of default.

Such covenants will, among other things, restrict, subject to certain exceptions, our ability and that of the Subsidiary Guarantors (as defined below) and their respective subsidiaries to (i) engage in certain mergers, consolidations or liquidations, (ii) sell, lease or transfer all or substantially all of their respective assets, (iii) engage in certain transactions with affiliates, (iv) make changes to our fiscal year, (v) make changes in the nature of our business and our subsidiaries, and (vi) incur additional indebtedness that is secured on a pari passu basis with the Credit Facility.

The Credit Facility also requires us, on a consolidated basis with our subsidiaries, to maintain a (i) maximum total leverage ratio, (ii) maximum secured leverage ratio, (iii) maximum unencumbered leverage ratio, (iv) minimum fixed charge coverage ratio, (v) minimum unencumbered fixed charge coverage ratio, and (vi) minimum tangible net worth.

If an event of default occurs, the lenders under the Credit Facility are entitled to take various actions, including the acceleration of amounts due under the Credit Facility and all actions permitted to be taken by a secured creditor.

The Credit Facility also requires us, on a consolidated basis with our subsidiaries, to maintain a (i) maximum total leverage ratio, (ii) maximum secured leverage ratio, (iii) maximum unencumbered leverage ratio, (iv) minimum fixed charge coverage ratio, (v) minimum unsecured interest coverage ratio, and (vi) maximum secured recourse leverage ratio.

If an event of default occurs, the lenders under the Credit Facility are entitled to take various actions, including the acceleration of amounts due under the Credit Facility.

As of December 31, 2020, and through the date our consolidated financial statements were issued, we believe we were in compliance with all affirmative and negative covenants.

INVITATION HOMES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

Guarantees and Security

The obligations under the Credit Facility are guaranteed on a joint and several basis by each of our direct and indirect domestic wholly owned subsidiaries that own, directly or indirectly, unencumbered assets (the “Subsidiary Guarantors”), subject to certain exceptions.

The guarantee provided by any Subsidiary Guarantor will be automatically released upon the occurrence of certain events, including if it no longer has a direct or indirect interest in an unencumbered asset or as a result of certain non-recourse refinancing transactions pursuant to which such Subsidiary Guarantor becomes contractually prohibited from providing its guaranty of the Credit Facility.

In addition, INVH may be required to provide a guarantee of the Credit Facility under certain circumstances, including if INVH does not maintain its qualification as a REIT.

The Credit Facility is collateralized by first priority or equivalent security interests in all the capital stock of, or other equity interests in, any Subsidiary Guarantor held by us and each of the Subsidiary Guarantors.

The security interests granted under the Credit Facility will be automatically released upon the occurrence of certain events, including upon an Investment Grade Rating Event or if the total net leverage ratio is less than or equal to 8.00 :

1.00 for four consecutive fiscal quarters.

The obligations under the Credit Facility are guaranteed on a joint and several basis by each of our direct and indirect domestic wholly owned subsidiaries that directly own unencumbered assets (the “Subsidiary Guarantors”), subject to certain exceptions.

These guarantees will be automatically released upon the occurrence of certain events, including if the applicable Subsidiary Guarantor is no longer a direct owner of an unencumbered asset.

In addition, INVH and each subsidiary of INVH that owns equity in the Borrower may be required to provide a guarantee of the Credit Facility under certain circumstances, including if INVH does not maintain its qualification as a REIT.

Although the 2017 Credit Facility was secured, such security interests have been released and the Credit Facility is unsecured.

Convertible Senior Notes

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Interest on the 2019 Convertible Notes was payable semiannually in arrears on January 1st and July 1st of each year.

On December 28, 2018, we notified note holders of our intent to settle conversions of the 2019 Convertible Notes in shares of common stock.

The notes matured o n July 1, 2019 , and we settled substantially all of the outstanding balance of the 2019 Convertible Notes through the issuance of 12,553,864 shares of our common stock .

The notes matured on July 1, 2019, and we settled substantially all of the outstanding balance of the 2019 Convertible Notes through the issuance of 12,553,864 shares of our common stock.

In January 2017, SWH issued $ 345,000 in aggregate principal amount of 3.50 % convertible senior notes due 2022 (the “2022 Convertible Notes” and together with the 2019 Convertible Notes, the “Convertible Senior Notes”).

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Remaining Amortization

2019 Convertible Notes

December 31, 2020 December 31, 2019

2022 Convertible Notes

January 15, 2022

3.50 % 5.12 % 43.7694 January 15, 2022 1.04 years $ 345,000 $ 345,000

Net unamortized fair value adjustment

( 5,596 ) ( 10,701 )

$ 339,404 $ 334,299

(1) Effective rate includes the effect of the adjustment to the fair value of the debt as of the Merger Date, the value of which reduced the initial liability recorded to $ 324,252 for the 2022 Convertible Notes.

For the 2019 Convertible Notes, the effective interest rate was 4.92 % .

This rate included the effect of the adjustment to the fair value of the debt as of the Merger Date and reduced the initial liability recorded to $ 223,185 .

The conversion rate as of December 31, 2019 represents the number of shares of common stock issuable per $ 1,000 principal amount (actual $) of the 2022 Convertible Notes converted on such date , as adjusted in accordance with the indenture as a result of cash dividend payments and the effects of the Mergers.

(2) The conversion rate as of December 31, 2020 represents the number of shares of common stock issuable per $ 1,000 principal amount (actual $) of the 2022 Convertible Notes converted on such date, as adjusted in accordance with the indenture as a result of cash dividend payments and the effects of previous mergers.

As of December 31, 2020, the 2022 Convertible Notes do not meet the criteria for conversion.

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Terms of Conversion

At the settlement date, the conversion rate applicable to the 2019 Convertible Notes was 54.5954 shares of our common stock per $ 1,000 principal amount (actual $) of the 2019 Convertible Notes (equivalent to a conversion price of approximately $ 18.32 per common share — actual $).

On July 1, 2019, we settled substantially all of the outstanding balance of the 2019 Convertible Notes with the issuance of 12,553,864 shares of our common stock.

For the years ended December 31, 2019 and 2018, interest expense for the 2019 Convertible Notes, including non-cash amortization of discounts, was $ 5,586 and $ 11,057 , respectively.

INVITATION HOMES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

As of December 31, 2020, the conversion rate applicable to the 2022 Convertible Notes is 43.7694 shares of our common stock per $ 1,000 principal amount (actual $) of the 2022 Convertible Notes (equivalent to a conversion price of approximately $ 22.85 per common share — actual $).

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Upon conversion, we will pay or deliver, as the case may be, cash, common stock, or a combination of cash and common stock, at our election.

The “if-converted” value of the 2022 Convertible Notes exceeds their principal amount by $ 107,560 as of December 31, 2019 as the closing market price of our common stock of $ 29.97 per common share (actual $) exceeds the implicit conversion price.

The “if-converted” value of the 2022 Convertible Notes exceeds the principal amount by $ 103,483 as of December 31, 2020 as the closing market price of our common stock of $ 29.70 per common share (actual $) exceeds the implicit conversion price.

For the years ended December 31, 2020, 2019, and 2018, interest expense for the 2022 Convertible Notes, including non-cash amortization of discounts, was $ 17,181 , $ 16,929 , and $ 16,690 respectively.

INVITATION HOMES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

General Terms

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The following table summarizes the contractual maturities of our debt as of December 31, 2020:

Secured Term Loan

Term Loan Facility

Year Mortgage

Secured Term Loan Term Loan Facility (3)

Revolving Facility (3)

Convertible Senior Notes

Convertible Senior Notes Total

2021 $ 3,837,346 $ — $ — $ — $ — $ 3,837,346

2022 — — — — 345,000 345,000

2023 — — — — — —

2024 — — — — — —

2025 — — 2,500,000 — — 2,500,000

994,787 403,363 — — — 1,398,150

Total 4,832,133 403,363 2,500,000 — 345,000 8,080,496

deferred financing costs, net

( 12,035 ) ( 2,268 ) ( 29,093 ) — — ( 43,396 )

unamortized fair value adjustment

The maturity dates of the obligations are reflective of all extensions that have been exercised.

— — — — ( 5,596 ) ( 5,596 )

$ 4,820,098 $ 401,095 $ 2,470,907 $ — $ 339,404 $ 8,031,504

(1) The maturity dates of the obligations are reflective of all extensions that have been exercised as of December 31, 2020.

If fully extended, we would have no mortgage loans maturing before 2024.

Such extensions are available provided there is no continuing event of default under the respective mortgage loan agreement and the Borrower Entity obtains and

INVITATION HOMES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

delivers a replacement interest rate cap agreement from an approved counterparty within the required timeframe to the lender.

(2) On December 1, 2020, we submitted a notification to request an extension of the maturity date of the IH 2018-1 mortgage loan from March 9, 2021 to March 9, 2022.

Additionally, on January 9, 2021, the extension of the maturity date of the IH 2018-4 mortgage loan from January 9, 2021 to January 9, 2022 was approved by the lender (see Note 15).

(3) If we exercise the two six month extension options, the maturity date will be in 2026.

Note 8—Derivative Instruments

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LIBOR is set to expire at the end of 2021, and we will work with the counterparties to our swap agreements to adjust each floating rate to a comparable or successor rate.

Changes in the fair value of these swaps are recorded in other comprehensive income and are subsequently reclassified into earnings in the period in which the hedged

INVITATION HOMES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

forecasted transactions affect earnings.

Prior to January 31, 2017, all swaps were accounted for as non-designated hedges as the criteria for designation had not been met at that time.

In addition, in connection with the Mergers, we acquired various interest rate swap instruments, which we designated for hedge accounting purposes.

On the Merger Date, we recorded these interest rate swaps at their aggregate estimated fair value of $ 21,135 .

Over the terms of each of these swaps, an amount equal to the Merger Date fair value will be amortized and reclassified into earnings.

Changes in the fair value of these swaps are recorded in other comprehensive income and are subsequently reclassified into earnings in the period in which the hedged forecasted transactions affect earnings.

The table below summarizes our interest rate swap instruments as of December 31, 2020:

Agreement Date

Agreement Date Forward

Effective Date

December 21, 2016

February 28, 2017

January 31, 2022

One month LIBOR

December 11, 2019 (1)

February 28, 2017

December 31, 2024

One month LIBOR

January 12, 2017

February 28, 2017

August 7, 2020

One month LIBOR

January 13, 2017

February 28, 2017

One month LIBOR

January 20, 2017

February 28, 2017

March 9, 2020

One month LIBOR

January 10, 2017

January 15, 2019

January 15, 2020

One month LIBOR

April 19, 2018

January 31, 2019

January 31, 2025

One month LIBOR

February 15, 2019 (2)

March 15, 2019

March 15, 2022

One month LIBOR

April 19, 2018

March 15, 2019

November 30, 2024

One month LIBOR

April 19, 2018

March 15, 2019

February 28, 2025

One month LIBOR

July 15, 2019

July 15, 2020

One month LIBOR

January 10, 2017

January 15, 2020

January 15, 2021

One month LIBOR

March 9, 2020

One month LIBOR

July 15, 2020

July 15, 2021

One month LIBOR

June 28, 2018

August 7, 2020

One month LIBOR

January 10, 2017

January 15, 2021

July 15, 2021

One month LIBOR

December 9, 2019 (3)

July 15, 2021

November 30, 2024

One month LIBOR

November 7, 2018

March 15, 2022

July 31, 2025

One month LIBOR

November 7, 2018

March 15, 2022

July 31, 2025

One month LIBOR

On December 11, 2019, we modified an interest rate swap instrument to extend the maturity date from January 31, 2022 to December 31, 2024 with a decrease in the strike rate from 1.97 % to 1.74 % .

On February 15, 2019, we terminated an interest rate swap instrument and simultaneously entered into a new interest rate swap instrument with identical economic terms, except that the strike rate increased 2 bps , from 2.21 % to 2.23 % , and collateral posting requirements were removed.

On December 9, 2019, we modified the start date of an interest rate swap instrument from January 31, 2020 to July 15, 2021.

We paid the counterparty $ 8,239 in connection with this modification.

Rate Index Notional

December 11, 2019 February 28, 2017 December 31, 2024 1.74 % One month LIBOR $ 750,000

April 19, 2018 January 31, 2019 January 31, 2025 2.86 % One month LIBOR 400,000

February 15, 2019 March 15, 2019 March 15, 2022 2.23 % One month LIBOR 800,000

April 19, 2018 March 15, 2019 November 30, 2024 2.85 % One month LIBOR 400,000

April 19, 2018 March 15, 2019 February 28, 2025 2.86 % One month LIBOR 400,000

January 10, 2017 January 15, 2020 January 15, 2021 2.13 % One month LIBOR 550,000

May 8, 2018 March 9, 2020 June 9, 2025 2.99 % One month LIBOR 325,000

May 8, 2018 June 9, 2020 June 9, 2025 2.99 % One month LIBOR 595,000

June 3, 2016 July 15, 2020 July 15, 2021 1.47 % One month LIBOR 450,000

June 28, 2018 August 7, 2020 July 9, 2025 2.90 % One month LIBOR 1,100,000

January 10, 2017 January 15, 2021 July 15, 2021 2.23 % One month LIBOR 550,000

December 9, 2019 July 15, 2021 November 30, 2024 2.90 % One month LIBOR 400,000

November 7, 2018 March 15, 2022 July 31, 2025 3.14 % One month LIBOR 400,000

November 7, 2018 March 15, 2022 July 31, 2025 3.16 % One month LIBOR 400,000

During the year ended December 31, 2020, we terminated an interest rate swap and paid the counterparty $ 15,249 in connection with this termination.

During the year ended December 31, 2019, we modified the start date of an interest rate swap and paid the counterparty $ 8,239 in connection with the modification.

During the years ended December 31, 2020, 2019, and 2018, such derivatives were used to hedge the variable cash flows associated with existing variable-rate interest payments.

Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are made on our variable-rate debt.

During the next 12 months, we estimate that $ 44,887 will be reclassified to earnings as a decrease in interest expense.

During the next 12 months, we estimate that $ 147,020 will be reclassified to earnings as an increase in interest expense.

INVITATION HOMES INC.

1 unchanged sentence

(dollar amounts in thousands)

During the year ended December 31, 2020, we accelerated the reclassification of certain amounts in other comprehensive income to earnings as a result of a portion of the hedged forecasted transactions becoming probable not to occur.

The accelerated amounts represented a loss of $ 3,111 and were recorded as interest expense in the accompanying consolidated statement of operations for the year ended December 31, 2020.

We did not accelerate the reclassification of any amounts in other comprehensive income to earnings during the years ended December 31, 2019 and 2018.

Non-Designated Hedges

Concurrent with entering into certain of the mortgage loan agreements and in connection with the Mergers, we entered into or acquired and maintain interest rate cap agreements with terms and notional amounts equivalent to the terms and amounts of the mortgage loans made by the third party lenders .

Concurrent with entering into certain of the mortgage loan agreements and in connection with previous mergers, we entered into or acquired and maintain interest rate cap agreements with terms and notional amounts equivalent to the terms and amounts of the mortgage loans made by the third party lenders.

Currently, each of our cap agreements is indexed to LIBOR, which is set to expire at the end of 2021.

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The table below presents the fair value of our derivative financial instruments as well as their classification on the consolidated balance sheets as of December 31, 2020 and 2019:

Asset Derivatives

Liability Derivatives

Fair Value as of

Sheet Location

Asset Derivatives Liability Derivatives

Fair Value as of Fair Value as of

Sheet Location December 31, 2020 December 31, 2019 Balance

Sheet Location December 31, 2020 December 31, 2019

Derivatives designated as hedging instruments:

Interest rate swaps

Other liabilities

Interest rate swaps Other assets $ — $ 1,643 Other liabilities $ 539,560 $ 275,679

Derivatives not designated as hedging instruments:

Interest rate caps

Other liabilities

Interest rate caps Other assets 1 — Other liabilities — —

Total $ 1 $ 1,643 $ 539,560 $ 275,679

INVITATION HOMES INC.

6 unchanged sentences

Gross Amounts Not Offset in the Statement of Financial Position

Gross Amounts of Recognized Assets/ Liabilities

Gross Amounts Offset in the Statement of Financial Position

Net Amounts of Assets/ Liabilities Presented in the Statement of Financial Position

Financial Instruments

Cash Collateral Received

Gross Amounts of Recognized Assets/ Liabilities Gross Amounts Offset in the Statement of Financial Position Net Amounts of Assets/ Liabilities Presented in the Statement of Financial Position Financial Instruments Cash Collateral Received Net

Offsetting assets:

Derivatives $ 1 $ — $ 1 $ — $ — $ 1

Offsetting liabilities:

Derivatives $ 539,560 $ — $ 539,560 $ — $ — $ 539,560

December 31, 2019

Gross Amounts Not Offset in the Statement of Financial Position

Gross Amounts of Recognized Assets/ Liabilities

Gross Amounts Offset in the Statement of Financial Position

Net Amounts of Assets/ Liabilities Presented in the Statement of Financial Position

Financial Instruments

Cash Collateral Received

Offsetting assets:

Derivatives $ 1,643 $ — $ 1,643 $ ( 1,054 ) $ — $ 589

Offsetting liabilities:

Derivatives $ 275,679 $ — $ 275,679 $ ( 1,054 ) $ — $ 274,625

INVITATION HOMES INC.

3 unchanged sentences

The tables below present the effect of our derivative financial instruments in the consolidated statements of comprehensive loss and the consolidated statements of operations for the years ended December 31, 2020, 2019, and 2018:

Amount of Gain (Loss) Recognized in OCI on Derivative

Location of Gain (Loss) Reclassified from Accumulated OCI into Net Income (Loss)

Amount of Gain (Loss) Reclassified from Accumulated OCI into Net Income (Loss)

Total Amount of Interest Expense Presented in the Consolidated Statements of Operations

For the Years Ended December 31,

Amount of Loss Recognized

in OCI on Derivative Location of Gain (Loss) Reclassified from Accumulated OCI into Net Income (Loss) Amount of Gain (Loss) Reclassified from Accumulated OCI into Net Income (Loss) Total Amount of Interest Expense Presented in the Consolidated Statements of Operations

For the Years Ended December 31, For the Years Ended December 31, For the Years Ended December 31,

2020 2019 2018 2020 2019 2018 2020 2019 2018

Derivatives in cash flow hedging relationships:

Interest rate swaps

Interest expense

Interest rate swaps $ ( 388,466 ) $ ( 244,126 ) $ ( 43,211 ) Interest expense $ ( 116,549 ) $ 20,763 $ 18,627 $ 353,923 $ 367,173 $ 383,595

Recognized in

Net Income (Loss)

on Derivative

Amount of Loss Recognized in Net Income (Loss) on Derivative

Net Income (Loss) on Derivative Amount of Loss Recognized in Net Income (Loss) on Derivative

For the Years Ended December 31,

2020 2019 2018

Derivatives not designated as hedging instruments:

Interest rate swaps

Interest expense

Interest rate caps

Interest expense

Interest rate caps Interest expense $ 273 $ 126 $ 641

Credit-Risk-Related Contingent Features

2 unchanged sentences

If we had breached any of these provisions at December 31, 2020, we could have been required to settle the obligations under the agreements at their termination value, which includes accrued interest and excludes the nonperformance risk related to these agreements, of $ 564,623 .

As of December 31, 2018 , we had not posted any collateral for our interest rate swap agreements as the conditions specified in the derivative agreements that require such funding did not exist.

As of December 31, 2019 , none of our derivative agreements contain provisions that require us to post collateral deposits.

Note 8 — Equity

Stockholders’ Equity

As of December 31, 2019 , we have issued 541,642,725 shares of common stock to the public, the pre-IPO owners, in settlement of RSUs (see Note 10), and in conversion of the 2019 Convertible Notes and vested OP Units.

Note 9—Stockholders' Equity

As of December 31, 2020, we have issued 567,117,666 shares of common stock.

In addition, we issue OP Units from time to time which, upon vesting, are redeemable for shares of our common stock on a one -for-one basis or, in our sole discretion, cash and are reflected as non-controlling interests on our consolidated balance sheets and statements of equity.

As of December 31, 2020, 3,463,285 outstanding OP Units are redeemable.

During the years ended December 31, 2020, 2019, and 2018, we issued 25,474,941 , 20,994,748 , and 1,474,835 shares of common stock, respectively.

Public Offering

On June 4, 2020, we completed an underwritten public offering of 16,675,000 shares of our common stock, including 2,175,000 shares sold pursuant to the underwriters’ full exercise of the option to purchase additional shares.

During the year ended December 31, 2020, this offering generated net proceeds of $ 447,533 , after giving effect to commissions and other costs totaling $ 6,861 .

INVITATION HOMES INC.

1 unchanged sentence

(dollar amounts in thousands)

During the years ended December 31, 2019, 2018, and 2017 , we issued 20,994,748 , 1,474,835 , and 519,173,142 shares of common stock, respectively.

As of December 31, 2019 , 3,463,285 outstanding OP Units are redeemable.

At the Market Equity Program

On August 22, 2019, we entered into distribution agreements with a syndicate of banks (the “Agents”), pursuant to which we may sell, from time to time, up to an aggregate sales price of $ 800,000 of our common stock through the Agents (the “ATM Equity Program”).

During the years ended December 31, 2020 and 2019, we sold 8,413,224 and 1,957,139 , respectively, shares of our common stock under our ATM Equity Program, generating net proceeds of $ 239,190 and $ 55,263 , respectively, after giving effect to Agent commissions and other costs totaling $ 3,851 and $ 1,696 , respectively.

As of December 31, 2020, $ 500,000 remains available for future offerings under the ATM Equity Program.

To qualify as a REIT, we are required to distribute annually to our stockholders at least 90% of our REIT taxable income, without regard to the deduction for dividends paid and excluding net capital gains, and to pay tax at regular corporate rates to the extent that we annually distribute less than 100% of our net taxable income.

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The following table summarizes our dividends declared from January 1, 2019 through December 31, 2020:

Total Amount Declared

November 13, 2019

November 27, 2019

August 15, 2019

August 30, 2019

February 13, 2019

February 28, 2019

November 14, 2018

November 30, 2018

August 16, 2018

August 31, 2018

February 13, 2018

February 28, 2018

On January 30, 2020 , our board of directors declared a dividend of $ 0.15 per share to stockholders of record on February 12, 2020 , which is payable on February 28, 2020 (see Note 17 ).

At the Market Equity Program

During the year ended December 31, 2019 , we sold 1,957,139 shares of our common stock under our ATM Equity Program, generating net proceeds of $ 55,263 after giving effect to Agent commissions and other costs totaling $ 1,696 .

As of December 31, 2019 , $ 743,041 remains available for future offerings under the ATM Equity Program.

Combined Equity

Prior to the IPO, our business was conducted through the Invitation Homes Partnerships, which did not have a common capital structure.

However, the same board of directors was responsible for directing the significant activities of the Invitation Homes Partnerships and INVH LP on a combined basis.

Profits and losses, and cash distributions were allocated in accordance with the terms of each entity’s respective organizational documents.

As further described in Note 10 , we granted certain individuals incentive compensation units in the Invitation Homes Partnerships, the Class B Units, that were accounted for as a substantive class of equity due to the terms of the agreements and rights of the holders.

As a result of the pre-IPO reorganization transactions, all components of this combined equity were converted into shares of our common stock, and all Class B Units were either canceled or converted into interests in other entities.

INVITATION HOMES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

Note 9 — Related Party Transactions

Management Services

One of our consolidated subsidiaries, as the managing member of a joint venture with FNMA (see Note 5 ), earns a management fee based upon the venture’s gross receipts.

For the years ended December 31, 2019, 2018, and 2017 , we earned $ 2,823 , $ 2,834 , and $ 385 , respectively, of management fees which are included in other, net in the accompanying consolidated statements of operations.

Record Date Amount

Pay Date Total Amount Declared

Q4-2020 November 10, 2020 $ 0.15 November 25, 2020 $ 84,911

Q3-2020 August 12, 2020 0.15 August 28, 2020 84,286

Q2-2020 May 13, 2020 0.15 May 29, 2020 81,916

Q1-2020 February 12, 2020 0.15 February 28, 2020 81,673

Q4-2019 November 13, 2019 0.13 November 27, 2019 70,693

Q3-2019 August 15, 2019 0.13 August 30, 2019 70,465

Q2-2019 May 15, 2019 0.13 May 31, 2019 68,334

Q1-2019 February 13, 2019 0.13 February 28, 2019 67,965

On January 28, 2021, our board of directors declared a dividend of $ 0.17 per share to stockholders of record on February 10, 2021, which is payable on February 26, 2021.

Note 10—Share-Based Compensation

1 unchanged sentence

2017 Omnibus Incentive Plan (the “Omnibus Incentive Plan”) to provide a means through which to attract and retain key personnel and to provide a means whereby our directors, officers, employees, consultants, and advisors can acquire and maintain an equity interest in us, or be paid incentive compensation, including incentive compensation measured by reference to the value of our common stock, and to align their interests with those of our stockholders.

Under the Omnibus Incentive Plan, we may issue up to 16,000,000 shares.

Under the Omnibus Incentive Plan, we may issue up to 16,000,000 shares of common stock.

Our share-based awards consist of time-vesting RSUs, PRSUs, and Outperformance Awards (defined below).

1 unchanged sentence

Share-Based Awards

The following summarizes our share-based award activity since the IPO, including annual and other award activity, RSUs and restricted stock awards (“RSAs”) issued in connection with the IPO, RSUs issued and assumed in connection with the Mergers, and the Outperformance Awards.

The following summarizes our share-based award activity during the years ended December 31, 2020, 2019, and 2018.

Annual Long Term Incentive Plan (“LTIP”):

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During the years ended December 31, 2020, 2019, and 2018, we granted 499,228 , 534,547 , and 644,733 RSUs, respectively, pursuant to LTIP awards.

Each award includes components which vest based on time-vesting conditions, market based vesting conditions, and performance based vesting conditions, each of which is s ubject to continued employment through the applicable vesting date .

The LTIP awards issued during the year ended December 31, 2017 are divided into three tranches (“Tranche 1,” “Tranche 2,” and “Tranche 3”), which vest over periods ranging from one to four years.

The time-vesting RSUs granted during the years ended December 31, 2019 and 2018 vest in three equal annual installments based on an anniversary date of March 1, 2019 and March 31, 2018, respectively.

The time-vesting RSUs granted during the year ended December 31, 2017 vest in installments based on an anniversary date of March 1, 2017 as follows:

Tranche 1 on the first anniversary;

Tranche 2 in two equal installments on each of the first and second anniversaries;

and Tranche 3 in four equal installments on each of the first four anniversaries.

The PRSUs granted during the years ended December 31, 2019 and 2018 may be earned based on the achievement of certain measures over a three year performance period.

The PRSUs granted during the year ended December 31, 2017 may be earned based on the achievement of certain measures over an approximate one year , two year , or three year performance period, correlated to Tranche 1, Tranche 2, and Tranche 3, respectively.

The number of PRSUs earned will be determined based on performance achieved during the performance period for each measure at certain threshold, target, or maximum levels and corresponding payout ranges.

In general, the LTIP PRSUs are earned and vest after the end of the performance period on the date on which the performance results are certified (a “Certification Date”) by our compensation and management development committee (the “Compensation Committee”), except for Tranche 3 of the 2017 LTIP Awards of which 50 % vests at the Certification Date and 50 % on December 31, 2020.

All of the LTIP Awards are subject to certain change in control and retirement eligibility provisions that may impact these vesting schedules.

Each award includes components which vest based on time-vesting conditions, market based vesting conditions, and performance based vesting conditions, each of which is subject to continued employment through the applicable vesting date.

INVITATION HOMES INC.

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(dollar amounts in thousands)

LTIP time-vesting RSUs vest in three equal annual installments based on an anniversary date of March 1st.

LTIP PRSUs may be earned based on the achievement of certain measures over a three year performance period.

In general, the LTIP PRSUs are earned after the end of the performance period on the date on which the performance results are certified by our compensation and management development committee (the “Compensation Committee”).

All of the LTIP Awards are subject to certain change in control and retirement eligibility provisions that may impact these vesting schedules.

• PRSU Results:

During the years ended December 31, 2019 and 2018 , certain PRSUs vested and achieved performance in excess of the target level, resulting in the issuance of an additional 23,392 and 39,871 shares of common stock, respectively.

During the years ended December 31, 2020, 2019, and 2018, certain LTIP PRSUs vested and achieved performance in excess of the target level, resulting in the issuance of an additional 91,200 , 23,392 , and 39,871 shares of common stock, respectively.

Such awards are reflected as an increase in the number of awards granted and vested in the table below.

Certain other PRSUs did not achieve performance criteria, resulting in the cancellation of 52,896 awards during the year ended December 31, 2019 .

Certain other LTIP PRSUs did not achieve performance criteria, resulting in the cancellation of 5,348 and 52,896 awards during the years ended years ended December 31, 2020 and 2019, respectively.

Such awards are reflected as an increase in the number of awards forfeited/canceled in the table below.

As of December 31, 2020, all PRSU awards issued as part of the 2017 LTIP have fully vested.

• Director Awards:

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During the years ended December 31, 2019 and 2018, INVH issued 53,704 and 52,114 time-vesting RSUs, which awards fully vested on the dates of INVH’s 2020 and 2019 annual stockholders meetings, respectively.

• Supplemental Bonus Plan:

Upon the completion of our IPO, $ 59,797 of supplemental bonus awards were converted into 2,988,120 time-vesting RSUs that generally vested in three equal installments unless modified in connection with the Mergers or the resulting integration.

During the year ended December 31, 2019, the final supplemental bonus awards were fully vested.

• Merger-Related Awards:

During the year ended December 31, 2018, the grant date was established for 168,184 PRSUs issued in connection with the Mergers.

These Merger-related PRSUs may be earned based on the achievement of certain measures over performance periods that began on the Merger Date and end approximately one and a half to three years thereafter.

The number of Merger-related PRSUs earned will be determined based on performance achieved during the performance period for each measure at certain threshold, target, or maximum levels and corresponding payout ranges.

During the year ended December 31, 2019 , 77,926 of such PRSUs were forfeited, and 90,258 remain outstanding as of December 31, 2019 .

In general, the remaining outstanding Merger-related PRSUs are earned on the applicable Certification Date and will vest on the later of the Certification Date or the originally scheduled vesting date.

D uring the year ended December 31, 2017 , in connection with the Mergers , INVH issued 150,927 time-vesting awards which were scheduled to vest over a three year service period beginning on the Merger Date.

These merger-related PRSUs were eligible to be earned based on the achievement of certain measures over performance periods that began on the Merger Date and ended approximately one and a half to three years thereafter.

The number of merger-related PRSUs earned was determined based on performance achieved during the performance period for each measure at certain threshold, target, or maximum levels and corresponding payout ranges.

During the year ended December 31, 2019, vesting of all remaining time-vesting merger-related awards was accelerated in accordance with the terms of the award agreement.

and no such time-vesting merger-related awards remain outstanding as of December 31, 2019 .

During the year ended December 31, 2019, 77,926 of such PRSUs were forfeited;

and during the year ended December 31, 2020, all outstanding merger-related PRSUs vested.

Certain of these PRSUs achieved performance in excess of the target level, resulting in the issuance of an additional 4,756 shares of common stock which are reflected as an increase in the number of awards granted and vested in the table below.

• Bonus and Retention Awards:

During the year ended December 31, 2018, we granted 136,941 RSUs to employees (the “2018 Bonus Awards”).

E ach of the 2018 Bonus Awards is a time-vesting award which vests in three equal annual installments based on an anniversary date of March 1, 2018, subject to continued employment through the applicable vesting date.

During the year ended December 31, 2017, we granted 307,327 RSUs (the “Retention Awards”) each of which award is a time-vesting award with service periods, as amended, ranging from two years to four years .

In connection with the IPO, we issued the following RSAs and RSUs:

Conversion of Pre-IPO Awards:

In January 2017, as more fully described below, certain of the Class B Units were converted into 62,529 RSAs, all of which have vested in accordance with the original terms of the Class B Unit award agreements as of December 31, 2019 .

Recipients of certain Class B Units were also granted bonus awards (the “IH Bonus Awards”) entitling the recipients to receive bonus payments in connection with an IPO or exit event.

Upon completion of the INVH IPO, the $ 4,825 of IH Bonus Awards were settled in the form of 241,250 RSUs that were fully vested upon issuance.

Supplemental Bonus Plan:

In October 2016, we established a supplemental bonus plan for certain key executives and employees (the “Supplemental Bonus Plan”).

Pursuant to the Supplemental Bonus Plan, the awards became payable and the payment amount became determinable upon the completion of the IPO.

In January 2017, the $ 59,797 of awards were converted into 2,988,120 time-vesting RSUs that generally vested in three equal annual installments, commencing on the completion of the INVH IPO and on the first and second anniversaries thereafter, unless modified in connection with the Mergers or the resulting integration.

As of December 31, 2019 , all Supplemental Bonus Plan awards have vested or have been forfeited.

Each of the 2018 Bonus Awards is a time-vesting award which vests in three equal annual installments based on an anniversary date of March 1, 2018, subject to continued employment through the applicable vesting date.

As of December 31, 2020, 138,122 retention awards issued during the year ended December 31, 2017 remain outstanding and are scheduled to vest in June 2021.

Assumed Awards

In connection with the Mergers, we assumed the terms of award agreements governing 949,698 (as calculated in number of INVH shares of common stock) non-vested RSUs granted prior to the Mergers under SWH’s equity incentive plans.

Each assumed award was a time-vesting award that was issued with service periods ranging from three years to four years, unless accelerated pursuant to the original agreement or otherwise modified in connection with the Mergers or the resulting integration.

During the year ended December 31, 2020 , the final SWH equity awards were fully vested.

INVITATION HOMES INC.

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(dollar amounts in thousands)

assumed award is a time-vesting award that was issued with service periods ranging from three years to four years , unless accelerated pursuant to the original agreement or otherwise modified in connection with the Mergers or the resulting integration.

As of December 31, 2019, 61,561 awards remain outstanding and are scheduled to vest in March 2020.

Outperformance Awards

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Summary of Total Share-Based Awards

The following table summarizes activity related to non-vested time-vesting RSUs (including RSAs) and PRSUs, other than Outperformance Awards, during the years ended December 31, 2019 and 2018 and the period from January 31, 2017 through December 31, 2017:

Time-Vesting Awards

Total Share-Based Awards (1)

The following table summarizes activity related to non-vested time-vesting RSUs and PRSUs, other than Outperformance Awards, during the years ended December 31, 2020, 2019, and 2018:

Time-Vesting Awards PRSUs Total Share-Based Awards (1)

Number Weighted

Average Grant

Date Fair Value

Weighted Average Grant Date Fair Value (Actual $)

(Actual $) Number Weighted Average Grant Date Fair Value (Actual $) Number Weighted

Average Grant

Date Fair Value

Balance, January 31, 2017

Assumed in the Mergers

Balance, December 31, 2017 2,695,902 $ 21.51 408,102 $ 22.25 3,104,004 $ 20.79

387,746 21.94 654,137 22.22 1,041,883 22.12

( 1,351,019 ) ( 21.38 ) ( 133,496 ) ( 23.11 ) ( 1,484,515 ) ( 21.54 )

Forfeited / canceled

( 136,985 ) ( 22.69 ) ( 40,010 ) ( 22.44 ) ( 176,995 ) ( 22.63 )

Balance, December 31, 2018 1,595,644 21.63 888,733 22.09 2,484,377 21.79

242,224 23.44 369,419 24.27 611,643 23.94

( 1,076,025 ) ( 21.46 ) ( 83,938 ) ( 21.21 ) ( 1,159,963 ) ( 21.45 )

Forfeited / canceled

( 76,774 ) ( 22.03 ) ( 249,138 ) ( 21.75 ) ( 325,912 ) ( 21.81 )

Balance, December 31, 2019

685,069 22.48 925,076 23.13 1,610,145 22.86

225,760 28.25 428,114 29.61 653,874 29.14

( 339,448 ) ( 22.81 ) ( 353,156 ) ( 22.04 ) ( 692,604 ) ( 22.42 )

Forfeited / canceled

( 11,258 ) ( 25.59 ) ( 24,223 ) ( 23.56 ) ( 35,481 ) ( 24.20 )

Balance, December 31, 2020

560,123 $ 24.54 975,811 $ 26.36 1,535,934 $ 25.70

(1) Total share-based awards excludes Outperformance Awards.

(2) All vested share-based awards are included in basic EPS for the periods after each award’s vesting date.

The estimated fair value of share-based awards that fully vested d uring the years ended December 31, 2019, 2018, and 2017 was $ 30,526 , $ 33,106 , and $ 45,528 , respectively.

During the years ended December 31, 2019, 2018, and 2017 , vested awards include the acceleration of 295,459 , 374,162 , and 652,368 RSUs, respectively, pursuant to the terms and conditions of the Omnibus Incentive Plan and related award agreements.

The estimated fair value of share-based awards that fully vested during the years ended December 31, 2020, 2019, and 2018 was $ 12,625 , $ 30,526 , and $ 33,106 , respectively.

During the years ended December 31, 2020, 2019, and 2018, 2,109 , 295,459 , and 374,162 RSUs, respectively, were accelerated pursuant to the terms and conditions of the Omnibus Incentive Plan and related award agreements.

INVITATION HOMES INC.

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Grant-Date Fair Values

The grant-date fair values of the RSAs, time-vesting RSUs and PRSUs with performance condition vesting criteria are generally based on the closing price of our common stock on the grant date.

The grant-date fair values of the time-vesting RSUs and PRSUs with performance condition vesting criteria are generally based on the closing price of our common stock on the grant date.

However, the grant-date fair values for share-based awards with market condition vesting criteria are based on Monte-Carlo option pricing models.

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For the Years Ended December 31,

2020 2019 2018

Expected volatility (1)

17.2 % — 17.3 % 17.2 % — 17.4 % 14.5 % — 17.3 %

Risk-free rate 0.85 % 2.25 % — 2.42 % 2.38 %

Expected holding period (years) 2.09 — 2.84 2.84 — 2.92 2.71 — 2.84

Expected volatility for awards granted during the years ended December 31, 2019 and 2018 was estimated based on the historical volatility of INVH’s realized returns and the applicable index.

Expected volatility for awards granted during the year ended December 31, 2017 was estimated based on the leverage adjusted historical volatility of certain of our peer companies over a historical term commensurate with the remaining expected holding period.

Profits Interests — Class B Units

Prior to the IPO, the Invitation Homes Partnerships granted incentive compensation units to certain key employees and directors, which were profits interests for United States federal income tax purposes.

The Class B Units were accounted for as a substantive class of equity and contained both service based and performance based vesting criteria.

Recognition of compensation expense was recorded based on whether or not the award recipient was an employee of the Manager, a wholly owned subsidiary of one of the Invitation Homes Partnerships, resulting in some awards being recognized based on grant-date fair value and others being remeasured at each reporting period until the actual vesting date as required for non-employee awards.

Prior to the IPO, none of the performance based vesting criteria had been achieved, and as such through the date of the IPO, no compensation expense had been recorded for performance based Class B Units.

However, the IPO triggered achievement of the performance based criteria and effectively converted all such awards into service based awards.

2017 New Class B Unit Awards :

In January 2017, certain of the Invitation Homes Partnerships issued certain individuals a total of 9,838 Class B Units that were expected to vest based on terms and conditions similar to all other Class B Units.

2017 Class B Unit Conversion :

The pre-IPO reorganization transactions resulted in accelerated vesting of 7,520 Class B Units held by certain unitholders which resulted in additional share-based compensation expense of $ 11,601 as of the date of the IPO.

On January 31, 2017, in connection with the IPO, all of the Class B Units held by current employees of the Manager and certain directors (except for 3,878 fully vested Class B Units awarded to a certain unitholder) were either converted into shares of INVH common stock or canceled based on the value of the Class B Units implied by the per share price of common stock sold to the public in the IPO.

As such, a total of 730 Class B Units were converted into 62,529 RSAs, and 17,669 Class B Units were canceled for no consideration.

For the Class B Units converted into RSAs, vesting and other terms of the RSAs delivered in the conversion have the same vesting and other terms applicable to the corresponding Class B Units converted.

Additionally, the obligations under the remaining 40,992 fully vested Class B Units, including those of the unitholders who are not current employees of the Manager, certain directors, and the one employee unitholder noted above that did not convert, were converted into similar fully vested units of newly formed subsidiaries of the pre-IPO owners.

INVITATION HOMES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

The following table summarizes the activity related to the Class B Units for the period from December 31, 2016 through January 31, 2017, the date at which they were all canceled or converted:

Class B Units

Total Class B Units

Number of Units

Weighted Average Fair Value

Number of Units

Weighted Average Fair Value

Number of Units

Weighted Average Fair Value

Balance, December 31, 2016

Converted to RSAs

Converted to units of affiliated entities

Balance, January 31, 2017

As of January 31, 2017, no Class B Units were outstanding.

(1) Expected volatility was estimated based on the historical volatility of INVH’s realized returns and the applicable index.

Summary of Total Share-Based Compensation Expense

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For the Years Ended December 31,

2020 2019 2018

General and administrative $ 13,579 $ 15,083 $ 23,999

Property management expense

3,511 3,075 5,500

Total $ 17,090 $ 18,158 $ 29,499

As of December 31, 2020, there is $ 18,827 of unrecognized share-based compensation expense related to non-vested share-based awards which is expected to be recognized over a weighted average period of 1.77 years.

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The carrying amounts of restricted cash, certain components of other assets, accounts payable and accrued expenses, resident security deposits, and certain components of other liabilities approximate fair value due to the short maturity of these amounts.

Our interest rate swap agreements and interest rate cap agreements are the only financial instruments recorded at fair value on a recurring basis within our consolidated financial statements.

Our interest rate swap agreements, interest rate cap agreements, and investments in equity securities with a readily determinable fair value are recorded at fair value on a recurring basis within our consolidated financial statements.

The fair values of our interest rate caps and swaps, which are classified as Level 2 in the fair value hierarchy, are estimated using market values of instruments with similar attributes and maturities.

See Note 7 for the details of the balance sheet classification and the fair values for the interest rate caps and swaps.

See Note 8 for the details of the consolidated balance sheet classification and the fair values for the interest rate caps and swaps.

The fair values of our investments in equity securities with a readily determinable fair value are classified as Level 1 in the fair value hierarchy.

For additional information related to our investments in equity securities as of December 31, 2020 and 2019, refer to Note 6.

INVITATION HOMES INC.

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(dollar amounts in thousands)

Recurring Fair Value Measurements

The following table displays the carrying values and fair values of financial instruments as of December 31, 2020 and 2019:

December 31, 2019

December 31, 2018

December 31, 2020 December 31, 2019

Value Carrying

Assets carried at historical cost on the consolidated balance sheets:

Investments in debt securities (1)

Level 2 $ 245,237 $ 249,736 $ 316,991 $ 318,299

Liabilities carried at historical cost on the consolidated balance sheets:

Mortgage loans (2)

Level 2 $ 4,832,133 $ 4,923,107 $ 6,266,407 $ 6,292,261

Secured Term Loan (3)

Level 3 403,363 447,190 403,464 411,213

Term Loan Facility (4)

Level 3 2,500,000 2,514,623 1,500,000 1,500,444

Convertible Senior Notes (5)

Level 3 339,404 351,166 334,299 346,489

(1) The carrying values of investments in debt securities are shown net of discount.

(2) The carrying values of the mortgage loans are shown net of discount and exclude $ 12,035 and $ 27,946 of deferred financing costs as of December 31, 2020 and 2019, respectively.

The carrying value of the Secured Term Loan excludes $ 2,486 of deferred financing costs as of December 31, 2019 .

(3) The carrying value of the Secured Term Loan excludes $ 2,268 and $ 2,486 of deferred financing costs as of December 31, 2020 and 2019, respectively.

(4) The carrying value of the Term Loan Facility excludes $ 29,093 and $ 6,253 of deferred financing costs as of December 31, 2020 and 2019, respectively.

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Quantitative Information about Level 3 Fair Value Measurement (1)

Valuation Technique

Unobservable Input

Secured Term Loan

Discounted Cash Flow

Fair Value Valuation Technique Unobservable Input Rate

Secured Term Loan $ 447,190 Discounted Cash Flow

Effective Rate 2.41 %

Term Loan Facility

Discounted Cash Flow

Term Loan Facility 2,514,623 Discounted Cash Flow

Effective Rate 1.77 % — 2.55 %

Convertible Senior Notes

Discounted Cash Flow

Convertible Senior Notes 351,166 Discounted Cash Flow

Effective Rate 1.76 %

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(dollar amounts in thousands)

Nonrecurring Fair Value Measurements

Our assets measured at fair value on a nonrecurring basis are those assets for which we have recorded impairments.

The assets for which we have recorded impairments, measured at fair value on a nonrecurring basis, are summarized below:

Single-Family Residential Properties

The single-family residential properties for which we have recorded impairments, measured at fair value on a nonrecurring basis, are summarized below:

For the Years Ended December 31,

2020 2019 2018

Investments in single-family residential properties, net held for use (Level 3):

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Total impairments ( 89 ) ( 2,193 ) ( 507 )

Fair value $ 362 $ 7,062 $ 1,672

For the Years Ended December 31,

2020 2019 2018

Investments in single-family residential properties, net held for sale (Level 3):

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Total impairments ( 4,489 ) ( 12,017 ) ( 6,202 )

Fair value $ 16,938 $ 49,044 $ 27,407

For additional information related to our single-family residential properties as of December 31, 2020 and 2019, refer to Note 3.

ROU Lease Assets

During the year ended December 31, 2020, we relocated one of our corporate offices and vacated the former location.

As the expected undiscounted sublease payments through the remaining original lease term of the vacated office space no longer exceed the carrying value of the related ROU lease asset, we concluded that the ROU lease asset was not fully recoverable.

During the year ended December 31, 2020, we recorded impairment of $ 1,750 in other, net in the consolidated statements of operations.

The fair value of the ROU lease asset measured at fair value on a nonrecurring basis, which is classified as Level 3 in the fair value hierarchy, was determined based on a discounted cash flow analysis reflective of the income expected from a sublease.

For additional information related to our ROU lease assets as of December 31, 2020 and 2019, refer to Note 6.

INVITATION HOMES INC.

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Note 12—Earnings per Share

We compute EPS only for the period after February 1, 2017, the date on which our common stock began trading on the New York Stock Exchange.

Basic and diluted EPS are calculated as follows:

For the Year Ended December 31, 2019

For the Year Ended December 31, 2018

February 1, 2017

December 31, 2017

For the Years Ended December 31,

2020 2019 2018

(in thousands, except share and per share data)

Net income (loss)

Net loss for the period January 1, 2017 through January 31, 2017

Net (income) loss attributable to non-controlling interests

Net income (loss) attributable to common stockholders

net income available to participating securities

Net income (loss) available to common stockholders — basic and diluted $ 195,764 $ 145,068 $ ( 5,744 )

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Incremental shares attributed to non-vested share-based awards

1,465,286 1,263,825 —

Weighted average common shares outstanding — diluted 555,458,607 532,499,787 520,376,929

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Incremental shares attributed to non-vested share-based awards are excluded from the computation of diluted EPS when they are anti-dilutive.

For the year ended December 31, 2019 , 121 incremental shares attributed to non-vested share-based awards are excluded from the denominator as their inclusion would have been anti-dilutive.

For the year ended December 31, 2018 and the period from February 1, 2017 through December 31, 2017 , 1,267,175 , and 896,993 incremental shares attributed to non-vested share-based awards, respectively, are excluded from the computation of diluted EPS because they are anti-dilutive.

For the years ended December 31, 2019, 2018, and 2017 , the vested OP Units have been excluded from the computation of EPS because all income (loss) attributable to the OP Units has been recorded as non-controlling interest and thus excluded from net income (loss) available to common stockholders.

For the years ended December 31, 2020, 2019, and 2018, 467 , 121 , and 1,267,175 incremental shares attributed to non-vested share-based awards, respectively, are excluded from the denominator as their inclusion would have been anti-dilutive.

For the years ended December 31, 2020, 2019, and 2018, the vested OP Units have been excluded from the computation of EPS because all income attributable to the OP Units has been recorded as non-controlling interest and thus excluded from net income (loss) available to common stockholders.

For the years ended December 31, 2019 and 2018, using the “if-converted” method, 6,225,341 and 12,420,013 , respectively, potential shares of common stock for the 2019 Convertible Notes for the period prior to conversion are excluded from the computation of diluted EPS as they are anti-dilutive.

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Additionally, no adjustment to the numerator is required for interest expense related to the Convertible Senior Notes for the years ended December 31, 2020, 2019, and 2018.

For the period from February 1, 2017 through December 31, 2017 , we asserted our intent and ability to fully settle the Convertible Senior Notes in cash;

and as a result, the Convertible Senior Notes did not impact diluted EPS during that period.

See Note 7 for further discussion about the Convertible Senior Notes.

INVITATION HOMES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

Note 13—Income Tax

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We provide a valuation allowance, from time to time, for deferred tax assets for which we do not consider realization of such assets to be more likely than not.

As of December 31, 2019 and 2018 , we have no t recorded any deferred tax assets and liabilities or unrecognized tax benefits.

As of December 31, 2020 and 2019, we have not recorded any deferred tax assets and liabilities or unrecognized tax benefits.

We do not anticipate a significant change in unrecognized tax benefits within the next 12 months.

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These transactions resulted in $ 870 , $ 2,490 , and $ 1,241 of current income tax expense for the years ended December 31, 2020, 2019, and 2018, respectively, which has been recorded in gain on sale of property, net of tax in the consolidated statements of operations.

INVITATION HOMES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

Note 14—Commitments and Contingencies

Leasing Commitments

Lease Commitments

The following table sets forth our fixed lease payment commitments as a lessee as of December 31, 2020, for the periods below:

Year Operating

2021 $ 5,108 $ 3,174

2022 4,182 2,547

2023 3,202 2,495

2024 2,854 731

Total lease payments 17,144 8,947

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Total lease liability $ 15,988 $ 8,389

As of December 31, 2019 , approximately $ 10,000 of finance leases for fleet vehicles with a lease term of 50 months have been entered into and are anticipated to commence during the next three months, and approximately $ 3,100 of operating leases for our office spaces with lease terms of 60 to 72 months have been entered into and are anticipated to commence during the next 12 months.

INVITATION HOMES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

The components of lease expense for the year ended December 31, 2019 are as follows:

For the Year Ended December 31, 2019

The components of lease expense for the years ended December 31, 2020 and 2019 are as follows:

For the Years Ended December 31,

Operating lease cost:

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Total operating lease cost $ 5,479 $ 5,353

Future minimum rental revenues under leases existing on our single-family residential properties as of December 31, 2019 are as follows:

Lease Payments to be Received

During the years ended December 31, 2018 and 2017, we incurred rent and other related occupancy expenses of $ 6,306 and $ 5,203 , respectively.

In accordance with previously applicable lease accounting guidance, ASC 840, Leases , the following table displays annual base rental commitments associated with our operating lease commitments, excluding operating expense reimbursements, month-to-month lease payments, and other related fees and expenses during the remaining lease terms as of December 31, 2018:

Finance lease cost:

Amortization of ROU assets $ 2,341 $ 491

Interest on lease liabilities 456 59

Total finance lease cost $ 2,797 $ 550

During the year ended December 31, 2018, we incurred rent and other related occupancy expenses of $ 6,306 .

Insurance Policies

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As of December 31, 2020, there are no material contingent liabilities related to uninsured losses with respect to our properties.

INVITATION HOMES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

Legal Matters

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We do not believe that the final outcome of these proceedings or matters will have a material adverse effect on our consolidated financial statements.

Note 15 — Business Combinations

On November 16, 2017, we completed the Mergers with SWH.

The Mergers were accounted for as a business combination in accordance with ASC Topic 805, Business Combinations , and INVH was designated as the accounting acquirer.

Because INVH was designated as the accounting acquirer, our historical financial statements for periods prior to November 16, 2017 represent only the historical financial information of INVH and its consolidated subsidiaries.

Purchase Price Allocation

The total purchase price has been allocated based upon (1) the amounts reported in the SWH historical financial statements for any assets that were reported at fair value in accordance with SWH’s historical accounting policies or (2) management’s estimates of fair value.

Management’s estimates of fair value for SWH’s investments in real estate properties were based upon a progressive method that incorporated three value sources:

automated valuation model data, BPOs, and internal desktop valuations (Level 3 measurements).

The fair value of our investment in the unconsolidated joint venture represents the estimated fair value of our equity interest in the joint venture with FNMA.

We determined the fair value based on the estimated fair value of the underlying investments in single-family residential properties after giving consideration to the terms and conditions of the related joint venture agreement (Level 3 measurement).

The fair value of other assets includes the estimated fair value of in-place leases in the amount of $ 45,740 , which was estimated based on lost rent and avoidable costs over an assumed vacancy period (Level 3 measurements).

Also included in other assets is the estimated fair value of interest rate swap agreements in the aggregate amount of $ 21,135 .

The fair value of SWH’s debt was determined by comparison of contractual terms of SWH’s existing debt obligations to the current market rates on a risk-adjusted basis as of the Merger Date.

The associated future debt cash flows were then discounted back to present value to arrive at an estimated fair value of SWH’s debt (Level 3 measurements).

INVITATION HOMES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

The allocation of the total purchase price to SWH’s tangible and intangible assets and liabilities under this methodology is as follows:

Consideration transferred

Assets acquired:

Buildings and improvements

Cash and cash equivalents

Restricted cash

Liabilities assumed:

Mortgage loans, net

Convertible senior notes, net

Accounts payable and accrued expenses

Resident security deposits

Other liabilities

Non-controlling interests

Net assets acquired

The goodwill recorded is primarily attributable to the value of synergies after the Mergers.

Merger and Transaction-Related Expenses

We incurred $ 4,347 , $ 16,895 , and $ 29,802 of merger and transaction-related expenses related to the Mergers during the years ended December 31, 2019, 2018, and 2017, respectively, included in general and administrative expenses in the consolidated statements of operations.

Merger and transaction-related expenses are expensed as incurred and are comprised primarily of transaction fees and direct acquisition costs, including legal, finance, consulting, professional fees, and other third party costs.

The costs that were obligations of SWH and expensed by SWH prior to the Merger Date are not included in our consolidated financial statements.

In addition, and in connection with the Mergers and the resulting integration, we have incurred severance costs for terminated and transitional employees, and such costs were accrued over the related remaining service periods.

More specifically, in August 2017, we entered into agreements with several of our executives, which provided the executives, as applicable, with benefits upon the consummation of the Mergers and/or where the executive experienced a qualifying termination within a specified period of time following such consummation.

After the consummation of the Mergers, if a severance plan participant experienced a qualifying termination, such person was entitled to specified benefits.

During the years ended December 31, 2019, 2018 and 2017, we incurred $ 1,041 , $ 8,238 , and $ 11,631 , respectively, of employee severance pursuant to severance plans and executive agreements, and these costs are included in general and administrative expenses in the consolidated statements of operations.

INVITATION HOMES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands)

Pro Forma Information

SWH contributed rental revenues and other property income of $ 84,702 and net loss of $ 8,262 for the period from November 16, 2017 to December 31, 2017.

The following table provides the pro forma consolidated operational data as if the Mergers had occurred on January 1, 2016 (unaudited):

For the Year Ended December 31, 2017

Rental revenues and other property income

The pro forma consolidated operational data is based on assumptions and estimates considered appropriate by our management;

however, these pro forma results are not necessarily indicative of the results of operations that would have been obtained had the Mergers occurred on January 1, 2016, the beginning of the comparable annual period that was presented when the Mergers occurred.

The pro forma consolidated operational data does not include the impact of any synergies that were achieved from the Mergers or any strategies that management considered in order to continue to efficiently manage operations.

Note 16 — Summarized Quarterly Financial Data (Unaudited)

The following tables present summarized consolidated quarterly financial data for each of the eight quarters in the two year period ended December 31, 2019 :

(in thousands, except share and per share data)

Rental revenues and other property income

Net income available to common stockholders

Net income per share — basic

Net income per share — diluted

Dividends declared per common share

Shares used in calculation — basic

Shares used in calculation — diluted

(in thousands, except share and per share data)

Rental revenues and other property income

Net income (loss)

Net income (loss) available to common stockholders

Net income (loss) per share — basic

Net income (loss) per share — diluted

Dividends declared per common share

Shares used in calculation — basic

Shares used in calculation — diluted

Note 15—Subsequent Events

In connection with the preparation of the accompanying consolidated financial statements, we have evaluated events and transactions occurring after December 31, 2020, for potential recognition or disclosure.

INVITATION HOMES INC.

1 unchanged sentence

(dollar amounts in thousands)

Note 17 — Subsequent Events

In connection with the preparation of the accompanying consolidated financial statements, we have evaluated events and transactions occurring after December 31, 2019 , for potential recognition or disclosure.

Extensions of Existing Mortgage Loans

On January 9, 2021, the extension of the maturity date of the IH 2018-4 mortgage loan from January 9, 2021 to January 9, 2022 was approved by the lender.

Dividend Declaration

On January 28, 2021, our board of directors declared a dividend of $ 0.17 per share to stockholders of record on February 10, 2021, which is payable on February 26, 2021.

Voluntary Mortgage Loan Payments

INVITATION HOMES INC.

2 unchanged sentences

(dollar amounts in thousands)

Initial Cost to Company

Cost Capitalized Subsequent to Acquisition

Gross Amount at Close of Period

Initial Cost to Company Cost Capitalized Subsequent to Acquisition Gross Amount at Close of Period

Properties (1)

1 unchanged sentence

Encumbrances (2)

Land Depreciable

12,541 5,940 $ 659,381 $ 325,364 $ 1,616,121 $ — $ 270,280 $ 325,364 $ 1,886,401 $ 2,211,765 $ ( 337,664 ) 1920-2020 2012-2020 7 - 28.5 years

4,930 2,124 271,492 174,664 744,465 — 98,108 174,664 842,573 1,017,237 ( 131,602 ) 1900-2019 2012-2020 7 - 28.5 years

2,614 44 5,531 132,559 325,761 — 109,616 132,559 435,377 567,936 ( 97,398 ) 1877-2015 2012-2017 7 - 28.5 years

2,753 974 127,497 126,191 475,510 — 30,770 126,191 506,280 632,471 ( 46,228 ) 1952-2020 2017-2020 7 - 28.5 years

2,340 1,198 209,518 194,229 544,952 — 38,882 194,229 583,834 778,063 ( 58,186 ) 1885-2020 2017-2020 7 - 28.5 years

2,148 584 58,464 63,695 310,875 — 16,078 63,695 326,953 390,648 ( 37,156 ) 1954-2014 2017 7 - 28.5 years

1,867 970 130,498 86,725 219,973 — 56,090 86,725 276,063 362,788 ( 70,311 ) 1955-2015 2012-2020 7 - 28.5 years

3,005 1,971 314,258 130,262 571,699 — 47,499 130,262 619,198 749,460 ( 83,554 ) 1953-2019 2012-2020 7 - 28.5 years

1,126 68 9,766 66,782 138,038 — 52,414 66,782 190,452 257,234 ( 48,897 ) 1886-2015 2013-2015 7 - 28.5 years

Northern California

4,238 2,172 421,548 339,823 723,068 — 112,546 339,823 835,614 1,175,437 ( 163,004 ) 1900-2012 2012-2020 7 - 28.5 years

6,207 2,977 363,492 215,256 868,491 — 151,140 215,256 1,019,631 1,234,887 ( 178,849 ) 1947-2018 2012-2020 7 - 28.5 years

8,168 4,298 535,818 316,002 1,005,748 — 184,084 316,002 1,189,832 1,505,834 ( 210,648 ) 1925-2020 2012-2020 7 - 28.5 years

3,664 1,352 257,013 292,920 587,833 — 153,551 292,920 741,384 1,034,304 ( 135,373 ) 1890-2020 2012-2020 7 - 28.5 years

South Florida

8,286 2,073 377,633 718,446 1,484,121 — 216,393 718,446 1,700,514 2,418,960 ( 332,716 ) 1922-2020 2012-2020 7 - 28.5 years

Southern California

7,931 4,367 1,050,923 1,027,310 1,519,586 — 224,449 1,027,310 1,744,035 2,771,345 ( 327,411 ) 1900-2014 2012-2020 7 - 28.5 years

8,180 3,487 435,577 329,568 1,179,327 — 184,486 329,568 1,363,813 1,693,381 ( 254,060 ) 1923-2020 2012-2020 7 - 28.5 years

79,998 34,599 $ 5,228,409 $ 4,539,796 $ 12,315,568 $ — $ 1,946,386 $ 4,539,796 $ 14,261,954 $ 18,801,750 $ ( 2,513,057 )

(1) Number of properties represents 80,177 total properties owned less 179 properties classified as held for sale and recorded in other assets, net on the consolidated balance sheet as of December 31, 2020.

6 unchanged sentences

For the Years Ended December 31,

2020 2019 2018

Residential Real Estate

1 unchanged sentence

Additions during the period

Acquisitions related to the Mergers

Acquisitions 621,697 586,075 252,391

Initial renovations 93,096 63,630 44,207

13 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures