The partners in the apartment REIT “merger of equals” announced second-quarter earnings results yesterday. 

Both AvalonBay Communities’ and Equity Residential’s Q2 reports beat funds from operations estimates, according to Haendel St. Juste, managing director and senior REITs analyst for investment bank Mizuho Securities.

AVB bested consensus FFO estimates by 5 cents due to better-than-expected same-store net operating income, including revenue, operating expense timing and development lease-up performance, according to the Mizuho report shared with Multifamily Dive. EQR also beat FFO estimates due to improving rents and lower same-store operating expenses.

“All-told, we believe AVB and EQR results offer hope for a downtrodden Apartment group that has dramatically lagged REITs YTD by ~1,300bps implying upside to 2026 and 2027 earnings for its portfolio and that of its Coastal peers,” St. Juste wrote in an analyst note.

However, due to the impending merger, neither REIT held a conference call to discuss their Q2 earnings.

Here’s a look at the results from the two REITs with analyst reaction.

AvalonBay raises guidance

AvalonBay’s asking rents have risen 6.5% since the start of 2026, which is in line with historical seasonality, according to St. Juste. 

The Arlington, Virginia-based REIT saw rent blends rise 2.6% compared to 0.4% in Q1, on the strength of “lower turnover/healthy renewals of +4.1%,” according to St. Juste. In July, its rent change rate increased 3.7%, powered by new leases of 1.8% and renewals of 4.8%, according to a filing with the Securities and Exchange Commission.

“Our forecast for blended leasing spreads for all of 3Q is 2.6%, so the start to the quarter is strong, in our view,” Anthony Paolone, executive director at JPMorgan, said in an analyst note shared with Multifamily Dive.

Buoyed by an improving market and lowered supply in its urban core markets, AVB raised same-store revenue guidance by 20 basis points at the midpoint, lowered same-store operating expenses by 30 bps at the midpoint and increased same-store NOI by 40 basis points. 

“A healthier demand environment, easing new supply, and disciplined execution by our teams delivered strong rent growth and lower operating expenses in the first half of the year, enabling us to increase Same Store NOI guidance for the full year,” AVB Chief Operating Officer Sean Breslin said in the earnings release.

AVB saw its strongest year-over-year same-store revenue growth in San Francisco, at 9.6%; San Jose, California, at 4.4%; New York City, at 3.4%; and the East Bay in California at 3.2%. Denver, at -3.8%; Washington, D.C., at -2.2%; the expansion regions at -1.5%; and Seattle, at -0.9%, posted the weakest numbers in Q2.

"Our second quarter was strong, exceeding expectations, and the results reflect the enduring qualities of our business — a high-quality portfolio in supply-constrained markets, a proven operating platform, and teams that execute with consistency and discipline,” AVB President and CEO Benjamin Schall said in the earnings release.

Equity Residential has not seen peak rents yet

EQR’s rent blends of 2.8% increased 130 bps from Q1, driven by “lower turnover / healthy renewals of +5.2% in 2Q26 and -0.7% new leases,” according to St. Juste. However, that blend came in below Paolone’s estimate for Q2.

“An increasingly supportive job market combined with declining levels of new supply in most of our markets sets the combined company up for great success," said EQR President and CEO Mark Parrell in the earnings release.

Like AVB, EQR also raised full-year guidance. It boosted same-store revenue 20 bps at the midpoint and same-store NOI by 30 bps. Both REITs suspended earnings per share, FFO and core FFO guidance due to the merger.

“The increase in its same-store guidance was driven by strong momentum in San Francisco along with improvements in bad debt,” Paolone wrote.

San Francisco, at 7%; New York, at 3.8%; Orange County, California, at 2.4%; and Boston, at 1.6%; were EQR’s strongest year-over-year revenue performers in the quarter. Denver, at -6.4%; Dallas and Austin, Texas, at -1.3%; Atlanta, at -0.3%; and Washington, D.C., at 0.8%; were the weakest metros.

EQR’s new leases improved to -0.1%, while renewals were at 4.9% in July. “Accelerating much further in the coming months could be tough due to the leasing season coming to an end, but on this front, management noted that it did not yet see the peak in rents yet,” Paolone wrote.

“The positives we see are that two of the strongest markets in the country are San Francisco and New York, and EQR has strong positioning in both of these, though we would have expected its New York numbers to be a bit stronger,” Paolone wrote.

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