Equity Residential

Moat components scored on strength and durability with weights reflecting importance: 1) Efficient scale and barriers to entry in submarkets 35 percent weight, score 85. High land and construction costs, restrictive zoning, and long entitlement cycles in coastal cities constrain supply, supporting stable occupancy and rents.

This is reinforced by management commentary that 2026 supply in coastal markets should be at decade lows.

Risk of local political shifts and changing zoning over long horizons tempers durability. 2) Cost advantages from scale 25 percent weight, score 75. National platform with centralized systems, procurement, and access to low cost unsecured debt translates into modest operating and financing cost advantages, visible in largely fixed rate debt at sub 4 percent and investment grade access. 3) Intangible assets 20 percent weight, score 65. Brand and reputation matter in leasing and in municipal relationships but are not prohibitive to competitors. 4) Switching costs 20 percent weight, score 50. Residents can switch at lease end with limited friction, though moving costs and location preferences create mild frictions. 5) Network effects 0 percent weight, score 0. Apartments do not benefit from user driven network externalities.

Weighted result approximates 76. Evidence: portfolio scale and occupancy around 96 percent, debt structure and ratings, and management’s supply outlook.