04/20/2021 | Press release | Distributed by Public on 04/20/2021 04:05

Amendment to Annual Report (SEC Filing - 10-K/A)

airc-10ka_20201231.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-K/A

(Mark One)

For the fiscal year ended December 31, 2020

OR

For the transition period from to

Commission file number 1-39686 (Apartment Income REIT Corp.)

Commission file number 0-24497 (AIMCO Properties, L.P.)

APARTMENT INCOME REIT CORP.

AIMCO PROPERTIES, L.P.

(Exact name of registrant as specified in its charter)

Registrant's telephone number, including area code(303) 757-8101

Securities registered pursuant to Section 12(b) of the Act:

Securities registered pursuant to Section 12(g) of the Act:

None (Apartment Income REIT Corp.)

Partnership Common Units (AIMCO Properties, L.P.)

(title of each class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined by Rule 405 of the Securities Act.

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of 'large accelerated filer,' 'accelerated filer,' 'smaller reporting company,' and 'emerging growth company' in Rule 12b-2 of the Exchange Act.

Apartment Income REIT Corp.:

AIMCO Properties, L.P.:

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

The aggregate market value of the voting and non-voting common stock of Apartment Income REIT Corp. held by non-affiliates of Apartment Income REIT Corp. was approximately $5.6 billion based upon the closing price of $37.95 on December 15, 2020, which was the initial trading date of the registrant's common stock on the New York Stock Exchange.

As of March 5, 2021, there were 148,985,740 shares of Class A Common Stock outstanding.

Documents Incorporated by Reference

None.

EXPLANATORY NOTE

On December 15, 2020, Apartment Investment and Management Company ('Aimco') completed the previously announced separation of its business into two, separate and distinct, publicly traded companies, Apartment Income REIT Corp. ('AIR') and Aimco (the 'Separation'). AIMCO Properties L.P. ('AIR Operating Partnership') is the operating partnership in AIR's structure. Except as the context otherwise requires, 'Company,' 'we,' 'our,' and 'us' refer to AIR, the AIR Operating Partnership, and their consolidated subsidiaries, collectively.

Notwithstanding the legal form of the Separation, for accounting and financial reporting purposes, Aimco is presented as being spun-off from AIR. This presentation is in accordance with generally accepted accounting principles in the United States and is due primarily to the relative significance of AIR's business, as measured in terms of revenues, net income, assets, and other relevant indicators, as compared to Aimco before the Separation. Therefore, AIR is considered the divesting entity and treated as the accounting spinner, or accounting predecessor, and Aimco as 'spun' for accounting purposes. As a result, unless otherwise stated, the information contained herein relates to matters that related to pre-Separation Aimco as representing AIR's governance, compensation, and related matters. The Board of Directors of AIR is comprised of the directors who served on the pre-Separation Board of Directors of Aimco.

AIR, a Maryland corporation, is a self-administered and self-managed real estate investment trust. AIR, through wholly-owned subsidiaries, is the general and special limited partner of the AIR Operating Partnership. As of December 31, 2020, AIR owned approximately 93.5% of the legal interest in the common partnership units of the AIR Operating Partnership and 94.9% of the economic interest in the AIR Operating Partnership. The remaining 6.5% legal interest is owned by limited partners. As the sole general partner of the AIR Operating Partnership, AIR has exclusive control of the AIR Operating Partnership's day-to-day management.

The AIR Operating Partnership holds all of AIR's assets and manages the daily operations of AIR's business. Pursuant to the AIR Operating Partnership agreement, AIR is required to contribute to the AIR Operating Partnership all proceeds from the offerings of its securities. In exchange for the contribution of such proceeds, AIR receives additional interests in the AIR Operating Partnership with similar terms (e.g., if AIR contributes proceeds of a stock offering, AIR receives partnership units with terms substantially similar to the stock issued by AIR).

This amendment amends the Annual Report on Form 10-K of the Company for the year ended December 31, 2020, that was originally filed with the SEC on March 15, 2021 (the 'Original Filing'). The Company is filing this amendment for the purpose of providing the information required by Items 10, 11, 12, 13, and 14 of Part III. This information was previously omitted from the Original Filing in reliance on General Instruction G(3) to Form 10-K, which permits the information in the above referenced items to be incorporated in the Form 10-K by reference from a definitive proxy statement if such statement is filed no later than 120 days after the Company's fiscal year end.

Table of Contents

Part III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

BOARD OF DIRECTORS AND EXECUTIVE OFFICERS

The executive officers of the Company and the nominees for election as directors of the Company, their ages, dates they were first elected an executive officer or director, and their positions with the Company or on the Board are set forth below.

The following is a biographical summary of the current directors and executive officers of the Company.

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Below is a summary of the qualifications and expertise of the directors, including expertise relevant to AIR's business.

Corporate Governance Matters

This chart provides a summary overview of AIR's governance practices, each of which is described in more detail in the information that follows.

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Meetings and Committees

The Board held 20 meetings during the year ended December 31, 2020. During 2020, there were three committees: Audit; Compensation and Human Resources; and Nominating and Corporate Governance. During 2020, no director attended fewer than 75% of the aggregate total number of meetings of the Board and each committee on which such director served.

The Corporate Governance Guidelines, as described below, provide that the Company generally expects that the Chairman of the Board will attend all annual and special meetings of the stockholders. Other members of the Board are not required to attend such meetings. All of the members of the Board attended the Company's 2020 Annual Meeting of Stockholders, joining electronically due to the health orders imposed with respect to the Covid-19 pandemic, and the Company anticipates that all of the members of the Board will attend the next annual meeting of stockholders when held.

Below is a table illustrating the current standing committee memberships and chairmen. Additional detail on each committee follows the table.

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Audit Committee

The Audit Committee currently consists of the Independent Directors. Ms. Tran serves as the chairman of the Audit Committee. The Audit Committee has a written charter that was adopted in connection with the Separation. In addition to the work of the Audit Committee, Ms. Tran has regular and recurring conversations with Mr. Beldin, AIR's Chief Financial Officer ('CFO'), with Ms. Cohn, AIR's President and General Counsel, with AIR's controller, with the head of AIR's internal audit function, and with representatives of Ernst & Young LLP. The Audit Committee's charter is posted on AIR's website (www.aircommunities.com) and is also available in print to stockholders, upon written request to AIR's Corporate Secretary.

The Audit Committee's responsibilities are set forth in the following chart.

The Audit Committee held five meetings during the year ended December 31, 2020. As set forth in the Audit Committee's charter, no director may serve as a member of the Audit Committee if such director serves on the audit committee of more than two other public companies, unless the Board determines that such simultaneous service would not impair the ability of such director to effectively serve on the Audit Committee. No member of the Audit Committee serves on the audit committee of more than two other public companies.

Audit Committee Financial Expert

AIR's Board has designated Ms. Tran as an 'audit committee financial expert.' In addition, all of the members of the Audit Committee qualify as audit committee financial experts. Each member of the Audit Committee is independent, as that term is defined by Section 303A of the listing standards of the New York Stock Exchange relating to audit committees.

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Compensation and Human Resources Committee

The Compensation and Human Resources Committee currently consists of the Independent Directors. Ms. Sperling serves as the chairman of the Compensation and Human Resources Committee. Ms. Sperling meets regularly with Ms. Cohn. Ms. Sperling also has regular conversations with AIR's independent compensation consultant, FPL Associates ('FPL') and with outside counsel with expertise in executive compensation and compensation governance related matters. The Compensation and Human Resources Committee has a written charter that was adopted in connection with the Separation. The Compensation and Human Resources Committee's charter is posted on AIR's website (www.aircommunities.com) and is also available in print to stockholders, upon written request to AIR's Corporate Secretary.

The Compensation and Human Resources Committee's responsibilities are set forth in the following charts.

One of the most important responsibilities of the Compensation and Human Resources Committee is to ensure a succession plan is in place for key members of the Company's executive management team, including the CEO. Based on the work of the Compensation and Human Resources Committee, the Board has a succession plan for the CEO position, is prepared to act in the event of a CEO vacancy in the short term, and has identified candidates for succession over the long term. The Board will select the successor taking into consideration the needs of the organization, the business environment, and each candidate's skills, experience, expertise, leadership, and fit. The Company maintains a robust succession planning process, as highlighted in the following chart.

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The Compensation and Human Resources Committee held five meetings during the year ended December 31, 2020.

Nominating and Corporate Governance Committee

The Nominating and Corporate Governance Committee currently consists of the Independent Directors. Ms. Nelson serves as the chairman of the Nominating and Corporate Governance Committee. The Nominating and Corporate Governance Committee has a written charter that was adopted in connection with the Separation. The Nominating and Corporate Governance Committee's charter is posted on AIR's website (www.aircommunities.com) and is also available in print to stockholders, upon written request to AIR's Corporate Secretary.

The Nominating and Corporate Governance Committee's responsibilities are set forth in the following chart.

The Nominating and Corporate Governance Committee held five meetings during the year ended December 31, 2020.

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Board Composition, Board Refreshment, and Director Tenure

AIR is focused on having a well-constructed and high performing board. To that end, the Nominating and Corporate Governance Committee selects nominees for director based on, among other things, breadth and depth of experience, knowledge, skills, expertise, integrity, ability to make independent analytical inquiries, understanding of AIR's business environment, and willingness to devote adequate time and effort to Board responsibilities. In considering nominees for director, the Nominating and Corporate Governance Committee seeks to have a diverse range of experience and expertise relevant to AIR's business. The Nominating and Corporate Governance Committee places a premium on directors who work well in the collegial and collaborative nature of the Board (which is also consistent with the AIR culture) and also requires directors who think and act independently and can clearly and effectively communicate their convictions. The Nominating and Corporate Governance Committee assesses the appropriate balance of criteria required of directors and makes recommendations to the Board.

The Nominating and Corporate Governance Committee has specifically considered the feedback of some stockholders as well as the discussions of some commentators that suggest lengthy Board tenure should be balanced with new perspectives. Specific to Aimco and post Separation, AIR, the Nominating and Corporate Governance Committee has structured the Board such that there are directors of varying tenures, with new directors and perspectives joining the Board every few years while retaining the institutional memory of longer-tenured directors. Longer-tenured directors, balanced with less-tenured directors, enhance the Board's oversight capabilities. AIR's directors work effectively together, coordinate closely with senior management, comprehend AIR's challenges and opportunities, and frame Aimco's business strategy. AIR's Board members have established relationships that allow the Board to apply effectively its collective business savvy in guiding the AIR's enterprise.

When formulating its Board membership recommendations, the Nominating and Corporate Governance Committee also considers advice and recommendations from others, including stockholders, as it deems appropriate. Such recommendations are evaluated based on the same criteria noted above. The Nominating and Corporate Governance Committee will consider as nominees to the Board for election at the next annual meeting of stockholders persons who are recommended by stockholders in writing, marked to the attention of AIR's Corporate Secretary, no later than July 1, 2021.

The Board is responsible for nominating members for election to the Board and for filling vacancies on the Board that may occur between annual meetings of stockholders.

Board Leadership Structure

In connection with the Separation, the Board concluded that separating the Chairman and CEO role would be most effective for the Company's leadership and governance. Mr. Keltner serves as Chairman of the Board, which includes: presiding over meetings of the Board; presiding over executive sessions of the Independent Directors, which are held regularly and not less than four times per year; with the CEO, setting meeting agendas and schedules; calling meetings of the Independent Directors; and being available for direct communication with stockholders.

The Board has a majority of independent directors. Eight out of the nine directors are independent. All three standing committees (Audit; Compensation and Human Resources; and Nominating and Corporate Governance) are composed solely of independent directors.

Separate Sessions of Independent Directors

AIR's Corporate Governance Guidelines (described below) provide that the non-management directors shall meet in executive session without management on a regularly scheduled basis, but no less than four times per year. The non-management directors, which group currently is made up of the eight Independent Directors, met in executive session without management four times during the year ended December 31, 2020.

The following table sets forth the number of meetings held by the Board and each committee during the year ended December 31, 2020.

Majority Voting for the Election of Directors

In an uncontested election at the meeting of stockholders, any nominee to serve as a director of the Company will be elected if the director receives a majority of votes cast, which means that the number of shares voted 'for' a director exceeds the number of shares voted 'against' that director. With respect to a contested election, a plurality of all the votes cast at the meeting of stockholders will be sufficient to elect a director. If a nominee who currently is serving as a director receives a greater number of 'against' votes for his or her election than votes 'for' such election (a 'Majority Against Vote') in an uncontested election, Maryland law provides that the director would continue to serve on the Board as a 'holdover director.' However, under AIR's Bylaws, any nominee for election as a director in an uncontested election who receives a Majority Against Vote is obligated to tender his or her resignation to the Nominating and Corporate Governance Committee for consideration. The Nominating and Corporate Governance Committee will consider any resignation and recommend to the Board whether to accept it. The Board is required to take action with respect to the Nominating and

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Corporate Governance Committee's recommendation. Additional details are set out in Article II, Section 2.03 (Election and Tenure of Directors; Resignations) of Aimco's Bylaws.

Proxy Access

Based on stockholder feedback, corporate governance best practices and trends, and the Company's particular facts and circumstances, the Board determined to provide in the Company's bylaws a proxy access right to stockholders. A stockholder or a group of up to 20 stockholders, owning at least 3% of our shares for at least three years, may submit nominees for up to 20% of the Board, or two nominees, whichever is greater, for inclusion in our proxy materials, subject to complying with the requirements contained in our bylaws.

The Board has adopted a code of ethics entitled 'Code of Business Conduct and Ethics' that applies to the members of the Board, all of AIR's executive officers and all teammates of AIR or its subsidiaries, including AIR's principal executive officer, principal financial officer and principal accounting officer. The Code of Business Conduct and Ethics is posted on AIR's website (www.aircommunities.com) and is also available in print to stockholders, upon written request to AIR's Corporate Secretary. If, in the future, AIR amends, modifies or waives a provision in the Code of Business Conduct and Ethics, rather than filing a Current Report on Form 8-K, AIR intends to satisfy any applicable disclosure requirement under Item 5.05 of Form 8-K by posting such information on AIR's website (www.aircommunities.com), as necessary.

The Board has adopted and approved Corporate Governance Guidelines. These guidelines are available on AIR's website (www.aircommunities.com) and are also available in print to stockholders, upon written request to AIR's Corporate Secretary. In general, the Corporate Governance Guidelines address director qualification standards, director responsibilities, director access to management and independent advisors, director compensation, director orientation and continuing education, the role of the Board in planning management succession, stock ownership guidelines and retention requirements, and an annual performance evaluation of the Board.

With respect to stock ownership guidelines for the Independent Directors, the Corporate Governance Guidelines provide that by the completion of five years of service, an Independent Director is expected to own, at a minimum, the lesser of 27,500 shares or shares having a value of at least $550,000. Each of the Independent Directors has holdings well in excess of this amount, with the exception of Messrs. Murphy and Rayis, who joined the Board on April 28, 2020.

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Corporate responsibility is an important part of our business. As with all other aspects of our business, our corporate responsibility program focuses on continuous improvement, to the benefit of our stockholders, our residents, our teammates, our communities, and the environment. We actively discuss these matters with our stockholders and solicit their feedback on our program.

The graphics below describe some of the 2020 highlights of our corporate responsibility program.

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Any interested parties desiring to communicate with AIR's Board, the Chairman of the Board, any of the other Independent Directors, any committee chairman, or any committee member may directly contact such persons by directing such communications in care of AIR's Corporate Secretary. All communications received as set forth in the preceding sentence will be opened by the office of AIR's General Counsel for the sole purpose of determining whether the contents represent a message to AIR's directors. Any contents that are not in the nature of advertising, promotions of a product or service, or patently offensive material will be forwarded promptly to the addressee. In the case of communications to the Board or any group or committee of directors, the General Counsel's office will make sufficient copies of the contents to send to each director who is a member of the group or committee to which the envelope or e-mail is addressed.

To contact AIR's Corporate Secretary, correspondence should be addressed as follows:

Corporate Secretary

Office of the General Counsel

Apartment Income REIT Corp.

4582 South Ulster Street, Suite 1700

Denver, Colorado 80237

Section 16(a) Beneficial Ownership Reporting Compliance. Section 16(a) of the Securities Exchange Act of 1934, as amended, requires executive officers and directors, and persons who own more than 10 percent of a registered class of an issuer's equity securities, to file reports (Forms 3, 4 and 5) of stock ownership and changes in ownership with the SEC and the New York Stock Exchange. Executive officers, directors, and beneficial owners of more than 10 percent of such issuer's registered equity securities are required by SEC regulations to furnish the issuer with copies of all such forms that they file.

Based solely on Aimco's, and now AIR's, review of the copies of Forms 3, 4, and 5 and the amendments thereto received by it for the year ended December 31, 2020, or written representations from certain reporting persons that no Forms 5 were required to be filed by those persons, AIR believes that during the period ended December 31, 2020, all filing requirements were complied with by its executive officers and directors with respect to AIR and Aimco.

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ITEM 11. EXECUTIVE COMPENSATION

COMPENSATION DISCUSSION & ANALYSIS (CD&A)

This CD&A addresses the following:

Separation

As noted previously, on December 15, 2020, AIR became a separate and distinct public company from Aimco with the consummation of the Separation. The management team of the Company served as the management team of Aimco for all but two weeks of 2020 and then as the management team of AIR. As described below, AIR's compensation philosophy remains largely consistent with that of Aimco's. Given the timing of the Separation, the 2020 elements of compensation and compensation philosophy covered in this CD&A reflect Aimco's compensation program and philosophy, and references relating to determinations made with respect to compensation generally reflect determinations made by Aimco or the Aimco Compensation and Human Resources Committee (the 'Committee'), as applicable, except where noted otherwise.

Stockholder Engagement Regarding Executive Compensation

At Aimco's 2020 Annual Meeting of Stockholders, approximately 98% of the votes cast in the advisory vote on executive compensation (also commonly referred to as 'Say on Pay') approved the compensation of Aimco's named executive officers (NEOs) as disclosed in the 2020 proxy statement. The AIR Compensation and Human Resources Committee (the 'AIR Committee') and AIR's management remain committed to extensive engagement with stockholders as part of ongoing efforts to formulate and implement an executive compensation program designed to align the long-term interests of our executive officers with those of our stockholders.

In the summer and fall of 2020, Aimco engaged with stockholders representing approximately 73% of Aimco's Class A Common Stock ('Aimco's Common Stock') outstanding as of September 30, 2020. Although Aimco's second outreach in 2020 was primarily focused on soliciting stockholder feedback on the Separation, Aimco also held discussions with some stockholders about its executive compensation program in the wake of the COVID-19 pandemic.

The following chart summarizes the collective feedback we received, and actions we have taken in response.

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Overview of Pay-for-Performance Philosophy and 2020 Performance Results

Aimco, and following the Separation, AIR, is a pay-for-performance organization. Aimco starts by setting target total compensation near the median of target total compensation for its peers as identified on page 24, both as a measure of fairness and also to provide an economic incentive to remain with the Company. Actual compensation varies from target compensation based on the Company's results. Each officer's annual cash incentive compensation, 'short term incentive' or STI, is based in part on the Company's performance against corporate, rather than personal, goals. The more senior the officer, the greater the percentage of his or her STI that is based on the Company's performance against its corporate goals. Longer term compensation, 'long term incentive' or LTI, follows a similar tiered structure. Each officer's LTI is based in part on the Company's 'total stockholder return' or TSR, relative to its peers, with executive officers having a greater share of their LTI based on relative TSR. In the case of Mr. Considine, his entire LTI award is 'at risk' based on the Company's relative TSR. LTI is measured and vests over time, typically a period of four years, so that officers bear longer term exposure to the decisions they make.

To reinforce alignment of stockholder and management interests, the Company also has stock ownership guidelines that require substantial equity holdings by executive officers, as described further on page 36.

Consummation of Separation of AIR and Aimco, unlocking $1 billion of stockholder value. The TSR of the combined companies outperformed the six large apartment REITs comprising the Company's multi-family peer group by more than 1,900 basis points from the announcement of the Separation in September 2020 through December 31, 2020. On the same combined basis, TSR was the best of the coastal apartment REITs for the past one, two, three, and five years. Coastal apartment REIT peers consist of Avalon Bay Communities, Inc., Essex Property Trust, Equity Residential, and UDR, Inc., which offer greater comparability in geographic markets and average rent levels. Multi-family peers include the coastal apartment REIT peers and also include Camden Property Trust and Mid-America Apartment Communities.

Aimco produced solid results across all five areas of strategic focus that provide the foundation for the long-term sustainable profitability we seek for the stockholder capital entrusted to Aimco.

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Highlights for 2020 in the Company's five areas of strategic focus included the following:

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Aimco's success in its five areas of strategic focus has produced superior long-term returns. The following graph compares cumulative total returns for Aimco's Common Stock, the NAREIT Apartment Index, the REIT Index, and the S&P 500 Index. The graph assumes the investment of $100 in Aimco's Common Stock and in each index or peer group company on December 31, 2015, and that all dividends paid have been reinvested. For the period from the Separation through December 31, 2020, this reflects the combined results of Aimco and AIR.

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Aimco and AIR outperformed the NAREIT Apartment Index and the REIT Index over the five-year period ended December 31, 2020, as shown in the following graph in which total stockholder return is presented as an annualized compounded annual growth rate. The Separation created significant value for stockholders. Including the performance of AIR shares distributed to Aimco stockholders, the combined investment outperformed the MSCI US REIT Index by 800 bps and the NAREIT Apartment Index by 1,700 bps on a cumulative basis over the five-year period ended December 31, 2020.

Summary of Executive Compensation Program and Governance Practices

Below we summarize certain executive compensation program and governance practices, including practices Aimco, and following the Separation, AIR, have implemented to drive performance and practices Aimco, and following the Separation, AIR, avoid because we believe they would not serve our stockholders' long-term interests.

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What We Pay and Why: Components of Executive Compensation

Total compensation for AIR named executive officers is comprised of the following components:

LTI compensation directly ties the interests of executives to the interests of our stockholders, and comprises a substantial proportion of compensation for AIR NEOs, as follows:

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CEO Pay Overview

The Committee determines the compensation for the CEO. In setting Mr. Considine's target total compensation for 2020, the Committee considered, among other things, the peer group compensation data as discussed below and Mr. Considine's expertise and experience. The Committee devised a compensation plan for Mr. Considine that resulted in approximately 10% base salary, 27% based on Aimco's performance against its 2020 corporate goals, and 63% based on relative TSR, making more of Mr. Considine's target compensation tied to TSR than is the case for anyof his peers. Mr. Considine's target compensation mix is illustrated as follows:

How the Committee determines the amount of target total compensation for executive officers

In addition to reviewing the performance of, and determining the compensation for, the CEO, the Committee also reviews the decisions made by the CEO as to the compensation of the other executive officers. Base salary, target STI, and target LTI are generally set near the median base salary, target STI, and target LTI for peer comparators.

How peer comparators are identified

The Committee considered enterprise Gross Asset Value ('GAV'), as reported by Green Street Advisors, to be an imprecise, but reasonable representation of the complexity of a real estate business and of the responsibilities of its leaders. In addition to GAV, the Committee also reviewed other factors, including gross revenues, number of properties, and number of employees, to determine if these factors provided any additional insight into the work and requirements of its leaders. Based on this analysis, Aimco included as 'peers' for 2020 compensation the following 20 real estate companies:

At the time 2020 compensation targets were established, approximately half of these real estate companies had a larger GAV, and approximately half of these real estate companies had a smaller GAV, than does the Company. Due to changes in GAV for AIR and its peers during 2019, American Campus Communities, Inc., Hudson Pacific Properties, Inc., JBG Smith Properties, Omega Healthcare Investors, and Park Hotels & Resorts, Inc. were added to the peer group for 2020 in replacement of Alexandria Real Estate Equities, HCP, Inc., Mid-America Apartment Communities, SL Green Realty Corp., and UDR, Inc.

For Mr. Kimmel, whose position as Executive Vice President, Property Operations, does not have a good benchmark outside of the multi-family industry, Aimco used a multi-family peer group for benchmarking his 2020 compensation, consisting of the following six multi-family real estate companies: AvalonBay Communities, Inc., Camden Property Trust, Essex Property Trust, Equity Residential, Mid-America Apartment Communities, Inc., and UDR, Inc.

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Risk analysis of compensation programs

The Committee considers risk-related matters when making decisions with respect to executive compensation and has determined that neither Aimco's or AIR's executive compensation program nor any of their non-executive compensation programs create risk-taking incentives that are reasonably likely to have a material adverse effect on the organization. Aimco's and, following the Separation, AIR's compensation programs align management incentives with the long-term interests of Aimco and AIR, respectively.

Total Compensation for 2020

For 2020, total compensation is the sum of base compensation earned in 2020, STI earned in 2020, and LTI awards granted in 2020.

Base Compensation for 2020

For 2020, Mr. Considine's base compensation was $700,000, unchanged from the previous three years, and well below the median for CEOs of his experience, expertise, and tenure in Aimco's, and now AIR's, peer group. For 2020, base compensation for all other NEOs was set between $251,732 and $450,000, near the median base compensation paid by peer comparators for similar positions.

Short-Term Incentive Compensation for 2020

The Committee determined Mr. Considine's STI by the extent to which Aimco met six designated corporate goals, which are described below and are referred to as Aimco's Key Performance Indicators, or KPIs.

For the other NEOs, calculation of STI was determined by two components: Aimco's performance against the KPI; and each officer's achievement of his or her individual MAP goals. For example, if an executive's target STI was $400,000 and weighted 75% on KPIs, then 75% of that amount, or $300,000, varied based on KPI results and 25% of that amount, or $100,000, varied based on MAP results. As actual KPI results were 100% of target in 2020, then the executive would receive 100% of $300,000 ($300,000) for the KPI portion of his STI, and if MAP results were 100%, such hypothetical executive would receive 100% of the $100,000, for a total STI payment of $400,000.

Aimco's 2020 KPIs reflected Aimco's five areas of strategic focus, as set forth below. Specifically, Aimco's KPIs consisted of the following six corporate goals that were reviewed with, and approved by, the Committee, each weighted as described.

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These goals aligned executive officers with the publicly communicated, long-term goals of Aimco without encouraging them to take unnecessary and excessive risks. Threshold performance paid out at 50%; target performance paid out at 100%; and maximum performance paid out at 200%.

For some goals, where performance was between threshold and target or between target and maximum, the amount of the payout was interpolated.

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The following is a tabular presentation of the performance criteria and results for 2020, explained in detail in the paragraphs that follow:

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For all numeric goals, the target performance metrics were Aimco's 2020 budget goals. Aimco had a rigorous budgeting process that includes an evaluation of prior performance, market data, and peer performance. Aimco's budget strategy is to set ambitious, achievable goals. Aimco's 2020 budget and KPI goals were finalized in January 2020, prior to the onset of the COVID-19 pandemic, which rendered two of the KPI goals moot, as described below. As a result, the Committee determined to apply discretion to replace the two goals with a goal related to Aimco's response to the pandemic. As described in detail below, Aimco, and following the Separation, AIR, ensured that its business remain open throughout the pandemic, with teammates across the country providing residents safety, a refuge from the virus, good neighbors, respectful treatment for all, and a helping hand to those in need.

An explanation of the objective of each goal and performance levels and payouts for each goal is set forth below.

Same Store NOI Achievement (35% of KPI). The primary objective of this goal was to fulfill Aimco's strategic objective of driving rent growth based on high levels of resident retention, through superior customer selection and satisfaction, coupled with disciplined innovation resulting in sustained cost control, to maximize NOI margins. For 2020, the range for the Same Store NOI achievement goal was as follows: 'Threshold' equated to achievement of three percent unfavorable to 2020 budgeted Same Store NOI; 'Target' equated to achievement of 2020 budgeted Same Store NOI; and 'Maximum' equated to three percent favorable to 2020 budgeted Same Store NOI. The Same Store NOI for 2020 was more than 3% unfavorable to budgeted Same Store NOI. This resulted in a payout on the Same Store NOI achievement goal of 0.00% for each of the NEOs. The COVID-19 pandemic, which arose after 2020 KPI goals were finalized in January 2020, rendered the Same Store NOI goal essentially moot, given the lockdowns that started March 2020, increased lease terminations due to economic stress, onerous regulations across the country and particularly in the City of Los Angeles, which made difficult rent collections and addressing non-payment. The Committee determined to replace the Same Store NOI goal and the AFFO goal, also rendered moot due to the pandemic, with a goal related to the Company's response to the COVID-19 pandemic. An explanation of the replacement goal, and the Company's performance against the replacement goal, is set forth below.

Redevelopment Investment and Returns, and Transactions That Improve Aimco's Portfolio Quality (10% of KPI). The primary objective of this goal was to fulfill Aimco's strategic objectives for redevelopment and portfolio management/capital allocation, two of the five areas of strategic focus described above. Large and/or complex redevelopment and development projects provided increased weighting toward the total goal weighting of 10%, with smaller scale projects provided lower weighting toward the total goal weighting. Achievement for each project was determined with reference to the 2020 budgeted investment and scope for the project and was based on the extent to which the project work was completed on time and within budget, as well as whether expected returns on investment were achieved. In 2020, Ground-up construction of Eldridge Townhomes in Elmhurst, IL and the lease-up of the community at rental rates ahead of underwriting were completed. Ground-up construction of Parc Mosaic in Boulder, CO and the lease-up of the community at rental rates consistent with underwriting were also completed. Additionally, construction on the redevelopment of 707 Leahy in Redwood City, CA, and the ground-up development of The Fremont on the Anschutz Medical Campus in Aurora, CO were also completed. Construction was on track and nearly complete at Prism in Cambridge, MA, and at the North Tower of Flamingo Point in Miami Beach, FL, the major redevelopment continued with a target to complete construction in 2022. Hamilton on the Bay, located in Miami's Edgewater neighborhood, was acquired for $89.6 million. The community includes a 271-apartment home community located on the waterfront plus an adjacent 0.6-acre development site with four apartment homes. Current zoning allows for the construction of more than 380 additional apartment homes on the combined sites. These outcomes resulted in a payout of this goal of 17.25% for each of the NEOs.

Leverage Ratios and Other Balance Sheet Activities Adding Financial Flexibility (10% of KPI). The primary objective of this goal was to fulfill Aimco's strategic objective of using safe property debt that is low-cost, long-dated, amortizing, and non-recourse, limiting entity and refunding risk while maintaining asset flexibility. Achievement was based on balance sheet activities that added financial flexibility. During the third quarter, Aimco sold a 39% interest in a $2.4B portfolio of California properties, enabling a $1B reduction in financial leverage, significantly improving Aimco's strong and flexible balance sheet. This resulted in a payout on the balance sheet goal of 20.00% for each of the NEOs.

Team Member Engagement Scores (5% of KPI). The primary objective of this goal was to fulfill Aimco's strategic objective of producing a strong, stable team that is the enduring foundation of Aimco and also of AIR's success. Every team member is surveyed via a third-party, confidential survey on his or her annual anniversary of employment. The team member engagement score consists of the average of the responses to the questions that comprise the engagement index, on a scale of 1 to 5, for all teammates who complete the survey during the year. For 2020 compensation, the range for team member engagement scores was as follows: 'Threshold' equated to 4.00; 'Target' equated to 4.20; and 'Maximum' equated to 4.75. For 2020, Aimco's team member engagement score was a record 4.42, resulting in a payout of 7.00% for each of the NEOs.

On-Site Team Engagement, Retention, and Efficiency (5% of KPI).The primary objective of this goal was to maintain a highly engaged, stable workforce at our communities, enhanced by innovations in efficiency, all of which further the strategic objective of maximizing NOI margins. Achievement was based on on-site team engagement scores, team member retention ratios, and efficiency gains. Aimco's on-site team member engagement score was a record 4.5 out of 5. On-site voluntary turnover was reduced by 19% and

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on-site overall turnover was reduced by 10%, each as compared to 2019. This resulted in a payout on the on-site engagement, retention, and efficiency goal of 8.00% for each of the NEOs.

AFFO Per Share (35% of KPI). The primary objective of the AFFO goal was to increase Aimco's current period financial result. For 2020 compensation, the range for the AFFO goal was set as follows: 'Threshold' equated to $2.30 per share; 'Target' equated to $2.40 per share; and 'Maximum' equated to $2.50 per share. Aimco's AFFO was less than $2.30 per share. These goals would have resulted in a payout on the AFFO per share goal of 0.00% for each of the NEOs. The COVID-19 pandemic, which arose after 2020 KPI goals were finalized in January 2020, rendered the AFFO goal moot, for the reasons described above in the Same Store NOI description, as NOI is the primary driver of AFFO. The Committee determined to replace the AFFO goal and the Same Store NOI goal, also rendered moot due to the pandemic, with a goal consisting of Aimco's response to the COVID-19 pandemic. An explanation of the replacement goal, and Aimco's performance against the replacement goal, is set forth below.

Replacement Goal: COVID-19 Response. Aimco designed its business with difficult economic times in mind, which is why: Aimco, and now AIR, give significant importance to customer selection and satisfaction and work hard to control property expenses; Aimco, prefers short-cycle redevelopment to less flexible ground-up development; the portfolio is also diversified by geography and price point; Aimco's, and now AIR's leverage is primarily long-dated, non-recourse property debt; and Aimco's and now AIR's, intentional culture emphasizes flexibility and initiative, collaboration and personal responsibility. This intentional design around its five areas of strategic focus enabled Aimco to take immediate action to serve its teammates, its residents, and local communities in response to the crisis.

As the crisis approached, Aimco made the health and safety of teammates its priority. Aimco (i) formed a cross-functional task force of approximately a dozen individuals who met daily to re-design how work would be done on site and to keep the team safe while continuing to lease apartments and fulfill service requests; (ii) made it clear, and consistent with company policies providing flexibility, that any teammate who felt unsafe at work because of the virus was free to stay home, with pay and without penalty; (iii) undertook to pay all costs related to COVID-19 testing and treatment; (iv) committed to keep the employee team intact, without layoffs or pay cuts; and (v) committed to continued, and increased, regular communications and transparency, providing a steady flow of written, oral, and video reports to the entire team.

Customer focus led Aimco to make its properties safer by increasing cleaning and disinfecting, reducing opportunities for infection, and limiting in-person interactions with neighbors and site teams. Aimco: searched out ways to support those sheltering in place and to meet the needs of those who reported positive for infection by COVID-19; redeployed construction supervisors whose work had been paused to support property service teams, and redeployed dozens of office workers to join the shared service center team to hold thousands of structured conversations with residents, helping each plan his or her personal adjustment to the crisis, including offering financial advice, tips on job searches, help with errands, ideas about how to find a roommate, establishing payment plans where appropriate, and even, in a few difficult cases, providing money for groceries; and used its previous investment in technology and artificial intelligence to adapt to the new conditions of social distancing and sheltering at home.

Additionally, mindful of the sacrifice of healthcare providers who worked long hours and felt unable to go home without risking infection of their families, and as part of the Aimco Cares Good Neighbor program, Aimco provided free use of furnished apartments at its 21 Fitzsimons community on the Anschutz Medical Campus, its Parc Mosaic community near Boulder Community Health, and its River Club community near Newark University Hospital.

Aimco's Board was fully informed and fully engaged, including two candidates for the Board who were formally elected in late April 2020. During March and April 2020, Aimco delivered five management reports, made numerous calls, asked individual directors for specific assistance, and held four virtual board meetings.

Knowing the importance of financial liquidity and building on $650 million of cash and committed credit at the start of 2020, Aimco drew down $300 million on its bank lines, reduced expected 2020 capital spending by $150 million, or almost one-half, and undertook to increase available credit by another $720 million: a $350 million bank term loan and approximately $370 million in proceeds from property loans.

As objective measures of Aimco's response to the pandemic, Aimco's resident satisfaction score, based on 57,000 surveys, was a 4.31 out of 5, within one basis point of its highest score on record. Aimco's team engagement scores shattered previous records: team engagement for site teams was 4.5 out of 5, breaking the previous year's all-time record of 4.45, and overall team engagement was 4.42 out of 5, above the prior year's 4.2 and also a new company record.

During the course of the year, the Committee continued to evaluate whether and how to adjust the goals set out at the beginning of the year and ultimately determined that it would wait until full year performance was known to evaluate performance against the original goals as well as the necessary business priorities that arose given the COVID-19 pandemic. Taking all of this into account, the Committee determined that Aimco's response to the COVID-19 pandemic should replace the NOI and AFFO goals.

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Although Aimco achieved outperformance on each of the other 2020 goals, the Committee capped overall KPI performance at target, or 100%. Accordingly, each executive officer was awarded 100% of the portion of his or her target STI attributable to KPI.

The Committee considered a number of factors in applying discretion to replace the Same Store NOI and AFFO goals with a goal consisting of Aimco's response to the COVID-19 pandemic, and in capping overall KPI performance at target. The Committee considered Aimco's strong record of pay and performance alignment, as demonstrated by Aimco's 98% or higher 'FOR' Say on Pay vote for the past five consecutive years. The Committee considered Aimco's regular engagement with stockholders holding at least two-thirds of its outstanding shares, the broad support received by stockholders with regard to company compensation plans, and the refinements Aimco has made to its compensation and other programs over the years as a result of those discussions. The Committee also considered Aimco's discussions with stockholders in 2020 regarding how to approach evaluation of STI goals rendered moot by the pandemic. The manner in which the Committee applied discretion with respect to 2020 STI goals is consistent with these discussions.

Various of the key financial indicators we use in managing our business and in evaluating our financial condition and operating performance are non-GAAP measures. Key non-GAAP measures we use are defined, described and, where appropriate, reconciled to the most comparable financial measures computed in accordance with GAAP under the Non-GAAP Measures heading within Part II, Item 7 in our Annual Report on Form 10-K for the year ended December 31, 2020.

Long-Term Incentive Compensation Awards for 2020

Under the 2020 LTI program for executive officers, four forms of LTI were granted to NEOs on January 28, 2020, as follows: (1) performance-based long-term incentive units in our operating partnership ('LTIP Units'), which were granted to Mr. Considine, representing 100% of his 2020 LTI award; (2) performance-based restricted stock, which was granted to Messrs. Beldin, and Kimmel and Ms. Cohn, representing two-thirds of the 2020 LTI awards for Mr. Kimmel, approximately 50% of the 2020 LTI awards for Mr. Beldin, and approximately 53% of the 2020 LTI awards for Ms. Cohn; (3) performance-based stock options, which were granted to Mr. Beldin and Ms. Cohn, representing approximately 17% of Mr. Beldin's 2020 LTI awards and approximately 13% of Ms. Cohn's LTI awards; and (4) time-based restricted stock, which was granted to Messrs. Beldin, and Kimmel and Ms. Cohn, representing one-third of their 2020 LTI awards, with 25% of the awards vesting on each anniversary of the grant date. The performance-based LTIP Units, the performance-based restricted stock, and the performance-based stock options are referred to as 'performance-based LTI awards,' because the number of such LTIP Units and the amount of restricted stock and stock options that vest, if any, is determined based on relative TSR performance during a forward looking, three-year performance period, as described in detail below. Mr. Wagner's 2020 LTI was granted in January 2021 according to the backward looking LTI plan for officers below the executive officer level, which is the plan that applied to Mr. Wagner prior to his promotion to Chief Investment Officer ('CIO') in December 2020. Mr. Wagner's 2020 LTI is discussed further below.

¹ Excludes Mr. Wagner, who was promoted to an executive officer position in December 2020.

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The amount of performance based LTI awards granted in 2020 that may vest are determined in accordance with the following TSR performance metrics:

Such metrics apply to the LTIP Units granted to Mr. Considine, all of which are performance based, the performance-based restricted stock granted to Messrs. Beldin, and Kimmel and Ms. Cohn, and the performance-based stock options granted to Mr. Beldin and Ms. Cohn. The Committee set threshold performance to pay out at 50%; target performance to pay out at 100%; and maximum performance to pay out at 200%. Performance below threshold will result in no payout. If performance is between threshold and target or between target and maximum, the amount of the payout will be interpolated. Performance-based LTI awards vest 50% following the end of the three-year performance period (based on attainment of TSR targets), and 50% one year later, for a four-year plan from start to finish, illustrated below, subject to the grantee's continued service to AIR, and subject to a delay if absolute TSR for the three-year forward looking performance period is negative.

Post Separation, the Committee determined that the remaining performance periods of the 2019 and 2020 AIR performance-based awards would be determined using the combined total stockholder return of AIR and Aimco.

Mr. Considine's LTIP Units are intended to constitute profits interests within the meaning of the Code. As described above, the number of Mr. Considine's LTIP Units granted in 2020 that may vest is determined based on AIR's relative TSR performance over the course of a forward looking, three year-performance period, with 50% of such number of LTIP Units generally vesting at the later of the time performance is determined or the third anniversary of the grant date and 50% vesting on the fourth anniversary of the grant date. With respect to 100% of the LTIP Units granted to Mr. Considine, all of which are performance based, Mr. Considine was granted the ability to participate in the appreciation of value of Aimco (now AIR) that took place after these LTIP Units were granted, subject to their vesting. For the purpose of calculating the number of shares subject to these LTIP Units, the target dollar amount was divided by $8.50, which price was calculated by a third-party financial firm with particular expertise in the valuation of such LTIP Units. The LTIP Units have a conversion price of $47.14, which was the closing price of Aimco's stock on the grant date and equal to the fair market value of Aimco's Common Stock on the grant date adjusted pursuant to the Employee Matters Agreement entered into in connection with the Separation. Additional details regarding the structure of LTIP Units can be found in the Amended and Restated Agreement of Limited Partnership of the AIR Operating Partnership, the Form of Performance Vesting LTIP Unit Agreement, and the Form of Performance Vesting LTIP II Unit Agreement, all of which are incorporated by reference into AIR's Annual Report on Form 10-K for the year ended December 31, 2020, as Exhibits 10.1, 10.18 and 10.20, respectively.

As provided in the Employee Matters Agreement, at the Separation each outstanding time or performance-vesting Aimco equity award was converted into awards of both shares of Aimco Common Stock and shares of AIR Common Stock. The number of shares of Aimco Common Stock and AIR Common Stock subject to each converted award (and the applicable exercise price with respect to converted stock option awards) was determined in a manner intended to preserve the aggregate value of the original Aimco equity award as measured immediately before the Separation. A similar adjustment was provided for with respect to LTIPs.

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For the purpose of calculating the number of shares of performance-based restricted stock to be granted to each of Messrs. Beldin and Kimmel and Ms. Cohn, the dollar amount allocated to restricted stock was divided by $53.53 per share, which was the average of the closing trading prices of the Aimco'sCommon Stock on the five trading days up to and including the grant date. The five-day average was used to mute the effect of any single day spikes or declines. The share award agreements to which the performance-based restricted shares were granted do not provide for the payment of dividends until the shares are earned. Dividends accrue during the performance period.For the purpose of calculating the number of shares subject to the performance-based stock options to be granted, the dollars allocated to stock options were divided by $8.15, which price was calculated by a third party financial firm with particular expertise in the valuation of options.The stock options have an exercise price of $47.14, which was the closing price of Aimco'sstock on the grant date and equal to the fair market value of Aimco's Common Stock on the grant date, adjusted pursuant to the Employee Matters Agreement entered into in connection with the Separation.

Mr. Wagner's 2020 LTI was granted on January 25, 2021, according to the backward looking LTI plan that governs LTI awards for officers below the executive officer level and was the plan that applied to Mr. Wagner prior to his promotion in December 2020. Under the plan that governs LTI awards for officers below the executive officer level, at the start of 2020, Mr. Considine determined that LTI for 2020 would be based in part on TSR. Specifically, 50% of the LTI target would be awarded for the purpose of attracting and retaining key talent integral to the success of Aimco. The remaining fifty percent of the LTI target would be based on TSR, with half (25% of the total LTI target) based on one-year TSR as compared to the REIT Index, and half (another 25% of the total LTI target) based on three-year TSR as compared to the REIT Index. TSR at greater than 110% of the REIT Index would result in a 125% payout of the LTI target attributable to TSR, and TSR at less than 90% of the REIT Index would result in a 75% payout of the LTI target attributable to TSR. TSR between 90% and 110% of the REIT Index would result in 100% payout of the LTI target attributable to TSR. One-year TSR was between 90% and 110% of the REIT Index, resulting in a payout of 100% of the portion of the LTI target attributable to one-year TSR, and three-year TSR was greater than 110% of the REIT Index, resulting in a payout of 125% of the portion of the LTI target attributable to three-year TSR. Accordingly, Mr. Wagner was awarded 106.25% of his target LTI (i.e., 50% of the LTI target was for the purpose of retention and paid at 100%; 25% of the LTI target was paid at 100% based on relative performance on one-year TSR; and 25% of the LTI target was paid at 125% based on relative performance on three-year TSR; and the net effect of these three components resulted in an overall award of 106.25% of target LTI).

NEO Compensation for 2020

CEO Compensation.The Committee determined Mr. Considine's STI for 2020 would be based entirely on the Company's performance against the six designated corporate goals, described above. The Committee calculated Mr. Considine's STI by multiplying his STI target of $1.8 million by 100%, which was the Committee's payout determination having reviewed overall performance on the six corporate goals. The Committee granted Mr. Considine's LTI in the form of LTIP Units on January 28, 2020, for the three-year performance period from January 1, 2020, through December 31, 2022; the LTI grant is entirely at risk, based on relative returns over the performance period. Mr. Considine's 2020 target compensation and incentive compensation are summarized as follows:

Other NEO Compensation.For Messrs. Beldin and Kimmel and Ms. Cohn, an allocation of the target STI was made as follows: 75% of the target STI was calculated based on the Company's performance against KPI and 25% of the target STI was calculated based on each executive's achievement of his or her individual MAP goals. Mr. Wagner's target STI was allocated 50% to KPI and 50% to achievement of his individual MAP goals. As noted above, the Company's KPI performance was 100.00%. Accordingly, each was awarded 100.00% of the portion of his or her STI attributable to KPI (i.e., 75% of the target STI amount shown below for Messrs. Beldin and Kimmel and Ms. Cohn, and 50% of the target STI amount shown below for Mr. Wagner).

In determining the MAP achievement component of 2020 STI, Mr. Considine determined that: Mr. Beldin's MAP achievement would be paid at 100% of target for his contributions to finance and accounting and to the Company's balance sheet; Ms. Cohn's MAP achievement would be paid at 200% for her leadership over legal matters, insurance, risk management, property dispositions, and asset quality and service, and specifically for her leadership in connection with Aimco's response to the COVID-19 pandemic; Mr. Kimmel's MAP achievement would be paid at 100% for his contributions to Aimco's operating results, particularly in the wake of the COVD-19

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pandemic; and Mr. Wagner's MAP achievement would be paid at 112.5%for his role in setting the parameters for a pure play multi-family investment vehicle. The Committee reviewed Mr. Considine's determinations with respect to Messrs. Beldin,Kimmel, and Wagnerand Ms. Cohn. As described in detail beginning on page 31, LTI for the NEOs other than the CEO and other than Mr. Wagner wasgranted on January 28, 2020, in the form of LTIP Units, restricted stock,and/or stock options. As described above, Mr. Wagner's LTI for 2020 was granted in January 2021. Target compensation and incentive compensation for 2020 for the other NEOs is summarized as follows:

Determination Regarding 2018 Performance Share Awards.As part of the 2018 LTI program, Aimco granted performance-share awards that might be earned based on relative TSR as compared to the NAREIT Apartment Index (60% weighting) and the REIT Index (40% weighting) over a three-year performance period ending on December 31, 2020, with awards vesting 50% following the end of the three-year performance period (based on attainment of TSR targets) and 50% one year later, for a four-year plan from start to finish. On January 27, 2021, the Committee determined that Aimco's three-year TSR (combined with AIR's TSR for the period from December 11, 2020, through December 31, 2020) was 330 basis points higher than the NAREIT Apartment Index and 300 basis points higher than the REIT Index for the three-year performance period ending on December 31, 2020, resulting in the number of shares being earned at 170% of target for Messrs. Considine, Beldin, and Kimmel and Ms. Cohn.

The chart below summarizes the results for the 2018 performance share awards, and provides performance as of December 31, 2020, for the 'in progress' 2020 and 2019 and performance share awards.

Other Compensation

From time to time, the Company determines to provide executive officers with additional compensation in the form of discretionary cash or equity awards. Mr. Considine awarded discretionary cash awards to the following executive officers for their significant contributions in connection with the Separation: Mr. Beldin - $250,000; Ms. Cohn - $550,000; Mr. Kimmel - $125,000; and Mr. Wagner - $50,000. Mr. Considine determined the amounts with reference to each individual's STI target amount, meaning that each award would not be more than the executive officer's STI target amount. These awards were in addition to, and not in lieu of, other compensation.

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The Committee recognized Mr. Considine's tremendous leadership in conceiving, structuring, guiding, and executingthe Separation. The Committee evaluated whether and what type of additional compensation to award Mr. Considine to recognize his work. After consideration, Mr. Considine proposed that he forego any financial compensation tied directly tothe value creation of the Separation in order to make clear that the purpose - and result - of the Separation was its creation of stockholder value. The Committee agreed and accepted this proposal.

Post-Employment Compensation and Employment and Severance Arrangements

401(k) Plan

Aimco, and AIR following the Separation, provide a 401(k) plan that is offered to all teammates. In 2020, Aimco and AIR together matched 25% of participant contributions to the extent of the first 4% of the participant's eligible compensation. For 2020, the maximum match was $2,850, which was the amount matched for each of Messrs. Considine, Beldin, Kimmel, and Ms. Cohn's 2020 401(k) contributions. Mr. Wagner's match was $2,412 of his 2020 401(k) contribution. No additional discretionary match was provided in 2021 because Aimco did not achieve greater than 105% performance of its 2020 corporate goals. Aimco's prior year discretionary match to all teammates, reflecting Aimco's achievement of greater than 125% on its 2019 corporate goals, was $1,200.

Other than the 401(k) plan, neither Aimco nor AIR provide post-employment benefits. Additionally, neither Aimco nor AIR maintains a defined benefit pension plan, a supplemental executive retirement plan or any other similar arrangements.

Executive Employment Arrangements

2017 Employment Agreement.On December 21, 2017, the AIR Operating Partnership entered into an employment agreement with Mr. Considine (the '2017 Employment Agreement'). The Committee at the time evaluated the terms of the 2017 Employment Agreement in comparison to those of the CEOs of Aimco's peers and other comparable companies. The 2017 Employment Agreement was for a two-year term. On December 19, 2019, the Committee extended the term of the 2017 Employment Agreement for an additional two years, from January 1, 2020, through December 31, 2021. The remaining terms and conditions of the 2017 Employment Agreement remained unchanged. On December 15, 2020, Mr. Considine and the AIR Operating Partnership amended the 2017 Employment Agreement to provide that references to the 'Company' in the 2017 Employment Agreement would be to AIR (rather than Aimco) following the Separation.

The 2017 Employment Agreement provides for a base salary of $700,000, subject to future increase. Mr. Considine also continues to be eligible to participate in AIR's performance-based incentive compensation plan with a target annual short-term incentive award opportunity of not less than $1.4 million (the 'Target STI'), and a target long-term incentive award opportunity of not less than $4.025 million, both subject to future increase.

Pursuant to the 2017 Employment Agreement, upon termination of Mr. Considine's employment by AIR without cause, by Mr. Considine for good reason, or upon a termination for reason of disability, Mr. Considine is generally entitled to: (a) a lump sum cash payment equal to the sum of (i) three times the sum of his base salary at the time of termination, and (ii) the Target STI; (b) any short-term incentive bonus earned but unpaid for a prior fiscal year (the 'Prior Year STI'); (c) a pro-rata portion of the short-term incentive bonus he would have earned for the year in which the termination occurs, based on the actual achievement of the applicable performance targets (the 'Pro Rata STI'); and (d) immediate and full acceleration of any outstanding unvested equity awards, with all outstanding stock options (including options previously vested) remaining exercisable until the expiration of the applicable option term. In the event of Mr. Considine's retirement, Mr. Considine will be entitled to: (a) the Prior Year STI; (b) the Pro Rata STI; and (c) accelerated vesting of outstanding and unvested equity awards, if any, that vest solely on a time basis and continued vesting of all outstanding unvested equity awards that vest based on the achievement of performance targets according to actual achievement of the applicable performance targets. If Mr. Considine's employment is terminated due to his death, Mr. Considine's estate will receive payment of any earned but unpaid base salary and vested accrued benefits, the Prior Year STI, and the Pro Rata STI, and all outstanding equity awards will become immediately and fully vested and be treated in accordance with the terms of the applicable award agreement.

Under the 2017 Employment Agreement, Mr. Considine is not entitled to any additional or special payments upon the occurrence of a change in control.

In the event payments to Mr. Considine are subject to the excise tax imposed by Section 4999 of the Internal Revenue Code, the payments will be either (a) delivered in full, or (b) delivered as to such lesser extent that would result in no portion of such payments being subject to the excise tax, whichever results in the receipt by Mr. Considine of the greater amount on an after-tax basis.

The 2017 Employment Agreement also contains customary confidentiality provisions, a limited mutual non-disparagement provision, and non-competition, non-solicitation, and no-hire provisions.

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In addition, as part of the Separation AIR and Aimco entered into the Employee Matters Agreement, which provides that Mr. Considine will continue to serve Aimco with specific responsibilities during the next two years to support the establishment and growth of the Aimco business, reporting directly to the Aimco board of directors.

None of Messrs. Beldin, Kimmel, or Wagner or Ms. Cohn has an employment agreement.

Executive Severance Arrangements

Executive Severance Policy. In connection with the Separation, AIR adopted the Apartment Income REIT Corp. Executive Severance Policy (the 'Executive Severance Policy'). The Executive Severance Policy supersedes and replaces any employment agreement or other plan, policy or practice involving the payment of severance benefits to participants under the Executive Severance Policy. The Company's Executive Vice Presidents, as determined on the records of the Company and any other entities through which the operations of the Company are conducted, are eligible to participate in the Executive Severance Policy. Each of Messrs. Beldin, Kimmel, and Wagner and Ms. Cohn are participants under the Executive Severance Policy; however, the Chief Executive Officer, Mr. Considine, is not a participant under the Executive Severance Policy.

The Executive Severance Policy provides that if the Company terminates a participant's employment without 'Cause,' or if the participant terminates his or her employment for 'Good Reason' (each as defined in the Executive Severance Policy), then the participant will be eligible to receive the following benefits:

The vesting and exercise of any equity awards held by a participant on the date of termination will be determined in accordance with the applicable incentive plan and award agreement.

Pursuant to the terms of the Executive Severance Policy, if the Company terminates a participant's employment without Cause, or if the participant terminates his or her employment for Good Reason, in either case, within the period commencing six months prior to and ending 12 months following a 'Change in Control' (as defined in the Executive Severance Policy), then in lieu of the severance benefits described above the participant will be eligible to receive the following benefits:

The Executive Severance Policy provides that if the employment of the participant is terminated by reason of the participant's death or disability, then the participant will be eligible to receive a pro-rated bonus for the year of termination. In addition, the vesting and exercise of any equity awards held by the participant at the time of his or her death or disability will be determined in accordance with the applicable incentive plan and award agreement.

In the event that any payment or benefit payable to a participant under the Executive Severance Policy would result in the imposition of excise taxes under the 'golden parachute' provisions of Section 280G of the Internal Revenue Code, then such payments and benefits will either be made and/or provided in full or will be reduced such that the excise tax under Section 280G is not applicable, whichever is least economically disadvantageous to the participant. The Executive Severance Policy does not provide for any excise tax or other tax 'gross-up' payment.

All severance payments and benefits under the Executive Severance Policy are subject to applicable withholding obligations, the participant's execution and non-revocation of a release of claims, and compliance with certain non-competition, non-disclosure and non-solicitation covenants set forth in a restrictive covenant agreement that is appropriate for the participant's position.

The Executive Severance Policy will remain in effect, subject to amendment, until terminated by the Board. The Board may terminate or amend the Executive Severance Policy at any time, so long as at least 90 days' prior notice is provided to any participant if the termination or amendment of the Executive Severance Policy would materially or adversely affect the rights of the participant.

Non-Competition and Non-Solicitation Agreements

Effective in January 2002 for Mr. Considine, and in connection with their employment or promotions by the Company for Messrs. Beldin and Kimmel and Ms. Cohn, the Company entered into certain non-competition and non-solicitation agreements with each executive. Mr. Considine's 2002 non-competition and non-solicitation agreement was replaced by his 2008 and 2017 Employment

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Agreements. Pursuant to these agreements, each of these NEOs agreed that during the term of his or her employment with the Company and for a period of two years following the termination of his or her employment, except in circumstances where there was a change in control of the Company, he or she would not (i) be employed by a competitor of the Company named on a schedule to the agreement, (ii) solicit other employees to leave the Company's employment, or (iii) solicit customers of Aimco to terminate their relationship with the Company. The agreements further required that the NEOs protect trade secrets and confidential information. For Messrs. BeldinandKimmel and Ms. Cohn, the agreements provide that in order to enforce the above-noted non-competition condition following the executive's termination of employment by the Company without cause, each such executive will receive, for a period not to extend beyond the earlier of 24 months following such termination or the date of acceptance of employment with a non-competitor, (i) non-compete payments in an amount, if any, to be determined by the Company in its sole discretion and (ii) a monthly payment equal to two-thirds of such executive's monthly base salary at the time of termination. For purposes of these agreements, 'cause' is defined to mean, among other things, the executive's (i) breach of the agreement, (ii) failure to perform required employment services, (iii) misappropriation of Company funds or property, (iv) conviction, plea of guilty, or plea of no contest to a crime involving fraud or moral turpitude, or (v) negligence, fraud, breach of fiduciary duty, misconduct or violation of law.Mr. Wagner's agreement provides for non-solicitation as well as confidentiality and trade secret protection.

Equity Award Agreements

Double Trigger Vesting Upon Change in Control.The award agreements pursuant to which restricted stock, LTIP Unit, or stock option awards have been granted to Messrs. Considine, Beldin and Kimmel, and Ms. Cohn, as applicable, provide that if (i) a change in control occurs and (ii) the executive's employment with the Company is terminated either by the Company without cause or by the executive for good reason, in either case, within 12 months following the change in control, then (a) for time-based options or restricted stock, all outstanding shares of restricted stock or unvested stock options shall become immediately and fully vested and exercisable, and all vested options will remain exercisable for the remainder of the term of the option, and (b) for performance-based options, restricted stock and/or LTIP Unit awards, shares, unvested options and/or units will vest based on the higher of actual or target performance through the truncated performance period ending on the date of the change in control, and all vested options will remain exercisable for the remainder of the term of the option.

Accelerated Vesting Upon Termination of Employment Due to Death or Disability.Pursuant to the 2017 Employment Agreement, as set forth above, if Mr. Considine's employment is terminated due to his death or disability, and all outstanding equity awards will become immediately and fully vested and be treated in accordance with the terms of the applicable award agreement. The award agreements pursuant to which restricted stock, LTIP Unit or stock option awards have been granted to Messrs. Considine, Beldin, Kimmel, and Wagner and Ms. Cohn, as applicable, provide that upon a termination of employment due to death or disability, then (a) for time-based options or restricted stock, all outstanding shares of restricted stock or unvested stock options shall become immediately and fully vested and exercisable, and all vested options will remain exercisable for the remainder of the term of the option, and (b) for performance-based options, restricted stock or LTIP Unit awards, shares, unvested options and/or units will vest based on the higher of actual or target performance through the date of termination, and all vested options will remain exercisable for the remainder of the term of the option.

Other Benefits; Perquisite Philosophy

Aimco's and after the Separation, AIR's executive officer benefit programs are substantially the same as for all other eligible officers and employees. AIR does not provide executives with more than minimal perquisites, such as reserved parking places.

Stock Ownership Guidelines and Required Holding Periods After Vesting

AIR believes that it is in the best interest of AIR's stockholders for AIR's executive officers to own AIR stock. Every year, the Committee and Mr. Considine review AIR's stock ownership guidelines, each executive officer's holdings in light of the stock ownership guidelines, and each executive officer's accumulated realized and unrealized stock option and restricted stock gains.

Equity ownership guidelines for all executive officers are determined as a minimum of the lesser of a multiple of the executive's base salary or a fixed number of shares. The Committee and management have established the following stock ownership guidelines for AIR's executive officers:

Any executive officer who has not satisfied the stock ownership guidelines must, until the stock ownership guidelines are satisfied, hold 50% of any restricted stock that vests, after deduction of restricted stock sold for payment of income taxes related to the vesting for at least three years from the date of vesting, and hold shares equal to 50% of (i) the value realized upon option exercises less (ii) related income taxes for at least three years from the date of exercise.

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Each of Messrs. Considine, Beldin, Kimmel and Ms. Cohn exceeded the ownership targets established in AIR'sstock ownership guidelines as of April 10, 2021. Mr. Wagner does not yet meet the requirements as he was promoted(and therefore became subject to the ownership targets)in connection with the Separation.

Role of Outside Consultants

The Committee has the authority under its charter to engage the services of outside advisors, experts, and others to assist the Committee. In 2020, the Committee engaged FPL Associates, L.P. ('FPL') to review Aimco's executive compensation plan. FPL did not provide other services to Aimco. The Committee has assessed the independence of FPL pursuant to SEC rules and has concluded that FPL is independent.

Base Salary, Incentive Compensation, and Equity Grant Practices

Base salary adjustments typically take effect on January 1. The Committee (for Mr. Considine) and Mr. Considine, in consultation with the Committee (for the other executive officers), and the AIR Committee following the Separation, determine incentive compensation in late January or early February. STI is typically paid in February or March. LTI is granted on a date determined by the Committee or the AIR Committee following the Separation, typically in late January or early February.

Aimco, and AIR following the Separation, grants equity in three scenarios: in connection with its annual incentive compensation program, as discussed above; in connection with certain new-hire or promotion packages; and for purposes of retention.

With respect to LTI, the Committee, and the AIR Committee following Separation, sets the grant date for the restricted stock, LTIP Unit, and stock option grants. The Committee sets grant dates at the time of its final compensation determination, generally in late January or early February. The date of determination and date of award are not selected based on share price. In the case of new-hire packages that include equity awards, grants are made on the employee's start date or on a date designated in advance based on the passage of a specific number of days after the employee's start date. For non-executive officers, the Committee, and the AIR Committee following the Separation, has delegated the authority to make equity awards, up to certain limits, to the Chief Financial Officer (Mr. Beldin) and/or Corporate Secretary (Ms. Cohn). The Committee and Mr. Beldin and Ms. Cohn time grants without regard to the share price or the timing of the release of material non-public information and do not time grants for the purpose of affecting the value of executive compensation.

2021 Compensation Targets

Based on comparison to compensation paid to CEOs at AIR's peers, the Committee set Mr. Considine's target total compensation (base compensation, STI and LTI) for 2021 unchanged at $6.8 million. Mr. Considine, in consultation with the Committee, set target total compensation (base compensation, STI and LTI) for 2021 for the other NEOs as follows: Mr. Beldin - $1.07 million; Ms. Cohn - $2.1 million; Mr. Kimmel - $1.7 million; and Mr. Wagner - $0.55 million. AIR performance will determine the amounts paid for 2021 STI and the portion of LTI awards that vest, and such amounts may be less than, or in excess of, these target amounts. STI will be paid in cash. The LTI granted to Ms. Cohn and Messrs. Beldin, Kimmel, and Wagner on January 25, 2021, was in the form of performance-based restricted stock and time-based restricted stock.

Accounting Treatment and Tax Deductibility of Executive Compensation

The Committee, and the AIR Committee following the Separation, generally considers the accounting treatment and tax implications of the compensation awarded or paid to our executives. Grants of equity compensation awards under our long-term incentive program are accounted for under FASB ASC Topic 718. Section 162(m) of the Internal Revenue Code was amended on December 22, 2017, by the Tax Cuts and Jobs Act (the 'Tax Act'). Under the Tax Act, Section 162(m) applies to each employee who serves as the principal executive officer or principal financial officer during the taxable year, each other employee who is among the three most highly compensated officers during such taxable year, and any other employee who was a covered employee for any preceding taxable year beginning after December 31, 2016. The Tax Act also eliminated the performance-based compensation exception with respect to tax years beginning after December 31, 2017, but includes a transition rule with respect to compensation that is provided pursuant to a written binding contract in effect on November 2, 2017, and not materially modified after that date. Aimco has awarded, and AIR will continue to award, compensation as it considers appropriate that does not qualify for deductibility under Section 162(m).

COMPENSATION AND HUMAN RESOURCES COMMITTEE REPORT TO STOCKHOLDERS

Prior to the Separation, the Aimco Compensation and Human Resources Committee (which prior to the Separation was comprised of the directors named below) held five meetings during the year ended December 31, 2020. The AIR Compensation and Human Resources Committee has reviewed and discussed the Compensation Discussion & Analysis with management. Based upon such review, the related discussions and such other matters deemed relevant and appropriate by the AIR Compensation and Human Resources Committee, the AIR Compensation and Human Resources Committee has recommended to the Board that the Compensation Discussion & Analysis be included in this filing.

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Date: April 16, 2021

THOMAS L. KELTNER

ROBERT A. MILLER

DEVIN I. MURPHY

KATHLEEN M. NELSON

JOHN DINHA RAYIS

ANN SPERLING (CHAIRMAN)

MICHAEL A. STEIN

NINA A. TRAN

The above report will not be deemed to be incorporated by reference into any filing by AIR under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except to the extent that AIR specifically incorporates the same by reference.

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SUMMARY COMPENSATION TABLE

The table below summarizes the compensation attributable to the principal executive officer, principal financial officer, and the three other most highly compensated executives in 2020, for the years 2020, 2019, and 2018.

The amounts shown in this column for 2020 include the grant date fair value of the performance-based restricted stock awards or performance-based LTIP Unit awards, as applicable, granted in 2020 based on the probable outcome of the performance condition to which such awards are subject, which was calculated by a third-party consultant using a Monte Carlo valuation model in accordance with FASB ASC Topic 718. Based on the foregoing, the grant date fair value is $8.50 per LTIP Unit as to Mr. Considine's performance-based LTI award, $53.88 per share for the performance-based restricted stock awards granted to each of Messrs. Beldin and Kimmel, and Ms. Cohn that are based on relative TSR Performance. The grant date fair value of the performance-based LTIP Unit award assuming achievement at the maximum level of performance, is $8,600,011 for Mr. Considine. The grant date fair value of the performance-based restricted stock awards, assuming achievement at the maximum level of performance, is $372,526 for Mr. Beldin, $1,181,050 for Ms. Cohn, and $1,006,586 for Mr. Kimmel.

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The amounts shown in this column for 2020 include the grant date fair value of the performance-based stock options granted in 2020 based on the probable outcome of the performance condition to which such option is subject, which was calculated by a third-party consultant using a Monte Carlo valuation model. Based on the foregoing, the grant date fair value is $8.15 per underlying share of the options. The grant date fair value of the options, assuming achievement at the maximum level of performance, is $123,342 for Mr. Beldin, and $293,335 for Ms. Cohn.

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GRANTS OF PLAN-BASED AWARDS IN 2020

The following table provides details regarding plan-based awards granted to the NEOs during the year ended December 31, 2020.

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The amounts shown in this column include the grant date fair value of the performance-based restricted stock awards or LTIP Unit awards, as applicable, based on the probable outcome of the performance condition to which such awards are subject, which was calculated by a third-party consultant using a Monte Carlo valuation model in accordance with FASB ASC Topic 718. Based on the foregoing, the grant date fair value is $8.50 per LTIP Unit as to Mr. Considine's performance-based LTI award, $53.88 per share for the performance-based restricted stock awards granted to each of Messrs. Beldin and Kimmel, and Ms. Cohn that are based on relative TSR performance. The grant date fair value of the performance-based LTIP Unit award, assuming achievement at the maximum level of performance, is $8,600,011 for Mr. Considine. The grant date fair value of the performance-based restricted stock awards, assuming achievement at the maximum level of performance, is $372,526 for Mr. Beldin, $1,181,050 for Ms. Cohn, and $1,006,586 for Mr. Kimmel.

The amounts shown in this column include the grant date fair value of the performance-based stock options based on the probable outcome of the performance condition to which such option is subject, which was calculated by a third-party consultant using a Monte Carlo valuation model. Based on the foregoing, the grant date fair value is $8.15 per underlying share of the options. The grant date fair value of the options, assuming achievement at the maximum level of performance, is $123,342 for Mr. Beldin, and $293,335 for Ms. Cohn.

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OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END 2020

The following table shows outstanding stock option awards classified as exercisable and unexercisable as of December 31, 2020, for the NEOs. The table also shows unvested and unearned stock awards assuming a market value of $38.41 per share (the closing market price of the AIR's Class A Common Stock ('AIR's Common Stock') on the New York Stock Exchange on December 31, 2020).

(2) This option was granted on January 31, 2017. The amount shown in the table represents the portion of the award that was earned based on Aimco relative TSR performance for the three-year performance period from January 1, 2017, through December 31, 2019, of which 50% vested on January 31, 2020, and the remaining 50% vested on January 31, 2021.

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(4) This option was granted on January 26, 2016. The amount shown in the table represents the portion of the award that was earned based on Aimco relative TSR performance for the three-year performance period from January 1, 2016, through December 31, 2018, of which 50% vested on January 26, 2019, and the remaining 50% vested on January 26, 2020.

(5) This performance-based LTIP Unit award was granted on January 29, 2019, and, subject to relative TSR metrics set forth in the CD&A, vests 50% following the end of the three-year forward looking performance period and 50% on the fourth anniversary of the grant date. The amount shown in the table is the award at target.

(6) This option was granted on February 12, 2015, and vested 25% on each anniversary of the grant date.

(7) This performance-based LTIP Unit award was granted on January 30, 2018. The amount shown in the table represents the portion of the award that was earned based on Aimco's relative TSR performance for the roughly three-year performance period from January 1, 2018, through December 11, 2020, of which 50% vested on January 30, 2021, and the remaining 50% will vest on January 30, 2022, as described in the CD&A. Mr. Considine holds a corresponding number of Aimco shares with a value of $235,542.

(8) This performance-based LTIP Unit award was granted on January 30, 2018. The amount shown in the table represents the portion of the award that was earned based on Aimco's relative TSR performance for roughly the three-year performance period from January 1, 2018, through December 11, 2020, of which 50% vested on January 30, 2021, and the remaining 50% will vest on January 30, 2022, as described earlier in the CD&A. Mr. Considine holds a corresponding number of Aimco shares with a value of $433,034.

(9) This performance-based LTIP Unit award was granted on January 31, 2017. The amount shown in the table represents the portion of the award that was earned based on Aimco's relative TSR performance for the three-year performance period from January 1, 2017, through December 31, 2019, of which 50% vested on January 31, 2020, and the remaining 50% vested on January 31, 2021, as described in the CD&A. Mr. Considine holds a corresponding number of Aimco shares with a value of $86,471.

(10) This option was granted on January 28, 2020 and, subject to relative TSR metrics set forth in the CD&A, vests 50% following the end of the three-year forward-looking performance period and 50% on the fourth anniversary of the grant date. The amount shown in the table is the award at maximum.

(12) This option was granted on January 31, 2017. The amount shown in the table represents the portion of the award that was earned based on Aimco's relative TSR performance for the three-year performance period from January 1, 2017, through December 31, 2019, of which 50% vested on January 31, 2020, and the remaining 50% will vest on January 31, 2022.

(14) This option was granted on January 26, 2016. The amount shown in the table represents the portion of the award that was earned based on Aimco's relative TSR performance for the three-year performance period from January 1, 2016, through December 31, 2018, of which 50% vested on January 26, 2019, 37.5% vested on January 26, 2020, and 12.5% vests on January 26, 2022.

(17) This restricted stock award was granted on January 30, 2018, and vests 100% on the fourth anniversary of the grant date. Mr. Beldin holds a corresponding number of Aimco shares with a value of $31,662.

(19) This restricted stock award was granted on January 31, 2017, and vested 25% on the first anniversary of the grant date and 75% will vest on the fifth anniversary of the grant date. The following NEO holds a corresponding number of Aimco shares with the following values: Mr. Beldin - $22,392.

(20) This performance-based restricted stock award was granted on January 31, 2017. The amount shown in the table represents the portion of the award that was earned based on Aimco's relative TSR performance for the three-year performance period from January 1, 2017, through December 31, 2019, of which 50% vested on January 31, 2020, and the remaining 50% will vest on January 31, 2022. Mr. Beldin holds a corresponding number of Aimco shares with a value of $19,341.

(21) This restricted stock award was granted on January 26, 2016, and vested 25% on each of the first, second anniversaries of the grant date and 50% will vest on the sixth anniversary of the grant date. Mr. Beldin holds a corresponding number of Aimco shares with a value of $14,045.

(22) This performance-based restricted stock award was granted on January 26, 2016. The amount shown in the table represents the portion of the award that was earned based on Aimco's relative TSR performance for the three-year performance period from January 1, 2016, through December 31, 2018, as described in the CD&A, of which 50% vested on January 26, 2019, 37.5% vested on January 26, 2020, and 12.5% vests on January 26, 2022. Mr. Beldin holds a corresponding number of Aimco shares with a value of $10,887.

(23) This restricted stock award was granted on January 26, 2016, and vested 25% on each of the first, second, and third anniversaries of the grant date and will vest 12.5% on each of the fifth and sixth anniversaries of the grant date. Mr. Beldin holds a corresponding number of Aimco shares with a value of $9,446.

(24) This restricted stock award was granted on January 30, 2018, and vests 25% on each anniversary of the grant date. The following NEOs hold a corresponding number of Aimco shares with the following values: Ms. Cohn- $22,134, and Mr. Kimmel - $15,286.

(25) This restricted stock award was granted on January 31, 2017, and vested 25% on each anniversary of the grant date. The following NEOs hold a corresponding number of Aimco shares with the following values: Ms. Cohn- $9,953, and Mr. Kimmel - $7,218.

(26) This performance-based restricted stock award was granted on January 31, 2017. The amount shown in the table represents the portion of the award that was earned based on Aimco's relative TSR performance for the three-year performance period from January 1, 2017, through December 31, 2019, of which 50% vested on January 31, 2020, and the remaining 50% vested on January 31, 2021. The following NEOs hold a corresponding number of Aimco shares with the following values: Ms. Cohn- $28,660, and Mr. Kimmel - $20,782.

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OPTION EXERCISES AND STOCK VESTED IN 2020

The following table sets forth certain information regarding options and stock awards exercised and vested, respectively, during the year ended December 31, 2020, for the persons named in the Summary Compensation Table above.

POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL

The NEOs are entitled to certain severance payments and benefits upon a qualifying termination of employment or, in the case of a change in control, double trigger accelerated vesting of equity awards in the event of a qualifying termination of employment that occurs within one year following a change in control. The terms of these arrangements are described under 'CD&A - Post-Employment Compensation and Employment and Severance Arrangements - Executive Employment Arrangements, Executive Severance Arrangements and Equity Award Agreements' above.

In the table that follows, potential payments and other benefits payable upon termination of employment and change in control situations are set out as if the conditions for payments had occurred and/or the terminations took place on December 31, 2020. In setting out such payments and benefits, amounts that had already been earned as of the termination date are not shown. Also, benefits that are available to all full-time regular employees when their employment terminates are not shown. The amounts set forth below are estimates of the amounts that could be paid out to the NEOs upon their termination. The actual amounts to be paid out can only be determined at the time of such NEOs' separation from AIR. The following table summarizes the potential payments under various scenarios if they had occurred on December 31, 2020.

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CHIEF EXECUTIVE OFFICER COMPENSATION AND EMPLOYEE COMPENSATION

We believe that executive pay should be internally consistent and equitable to motivate our teammates to create stockholder value. In August 2015, pursuant to a mandate of the Dodd-Frank Act, the SEC adopted a rule requiring annual disclosure of the ratio of the median employee's annual total compensation to the annual total compensation of the principal executive officer. The disclosure is required for fiscal years beginning on or after January 1, 2017. The annual total compensation for 2020 for Mr. Considine, our CEO, was $6,802,856, as reported under the heading 'Summary Compensation Table.' Our median employee's total compensation for 2020 was $68,664. As a result, we estimate that Mr. Considine's 2020 total compensation was approximately 99.07 times that of our median employee.

Our CEO to median employee pay ratio was calculated in accordance with Item 402(u) of Regulation S-K. We identified the median employee by examining 2020 total compensation, consisting of base salary, annual bonus amounts, stock-based compensation (based on the grant date fair value of awards granted during 2020) and other incentive payments for all individuals who were employed by the Company on December 31, 2020, other than our CEO. Our measuring date of December 31 remained the same as last year. We included all active employees and annualized the compensation for any employees who were not employed by the Company for the full 2020 calendar year. After identifying the median employee based on 2020 total compensation, we calculated annual total compensation for such employee using the same methodology we use for our named executive officers as set forth in the 'Total' column in the Summary Compensation Table.

In formulating its recommendation for director compensation, the Nominating and Corporate Governance Committee reviews director compensation for independent directors of companies in the real estate industry and companies of comparable market capitalization, revenue and assets and considers compensation trends for other NYSE-listed companies and S&P 500 companies. The Nominating and Corporate Governance Committee also considers the relatively small size of the AIR board as compared to other boards, the participation of each Independent Director on each committee, and the resulting workload on the directors. In addition, the Nominating and Corporate Governance Committee considers the overall cost of the Board to the Company and the cost per director.

As noted previously, on December 15, 2020, AIR became a separate and distinct public company from Aimco with the consummation of the Separation. The majority of the directors of the Company served as the directors of Aimco for all but two weeks of 2020 and then became directors of AIR. As described herein, AIR's director compensation philosophy, including with respect to its directors remains largely consistent with that of pre-Separation Aimco's. Given the timing of the Separation, the 2020 elements of director compensation reflect Aimco's compensation program and philosophy.

2020

For 2020, compensation for the Independent Directors remained consistent with their compensation for 2019. Specifically, director compensation included a fixed annual cash retainer of $90,000 and an award of 3,200 shares of fully vested Aimco Common Stock. No meeting fees were paid to Independent Directors for attending meetings of the Board and the committees on which they serve. For the year ended December 31, 2020, the Independent Directors were paid as follows:

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2021

Compensation for each of the Independent Directors in 2021 includes an annual fee of 4,000 shares of AIR Common Stock, which shares were awarded on January 25, 2021. The closing price of AIR's Common Stock on the New York Stock Exchange on January 25, 2021, was $39.21. The Independent Directors also received an annual cash retainer of $90,000, paid quarterly. Directors will not receive meeting fees in 2021.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth certain information available to the Company, as of April 12, 2021, with respect to AIR's equity securities beneficially owned by (i) each director, the chief executive officer, the chief financial officer and the three other most highly compensated executive officers who were serving as executive officers at the end of the last completed fiscal year, and (ii) all directors and executive officers as a group. The table also sets forth certain information available to the Company, as of April 12, 2021, with respect to shares of AIR's Common Stock held by each person known to the Company to be the beneficial owner of more than 5% of such shares. This table reflects options that are exercisable within 60 days. Unless otherwise indicated, each person has sole voting and investment power with respect to the securities beneficially owned by that person. The business address of each of the following directors and executive officers is 4582 South Ulster Street, Suite 1700, Denver, Colorado 80237, unless otherwise specified. None of the securities reflected in this table held by the directors or executive officers are the subject of any hedging or pledging transaction.

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SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS

Information on equity compensation plans as of the end of the 2020 fiscal year under which equity securities of the Company are authorized for issuance is set forth in the following table.

________________________

(1) Represents awards that were granted by Aimco prior to the Separation, which by operation of the Employee Matters Agreement adopted in connection with the Separation, these awards also became outstanding at AIR. These awards include unvested restricted stock and LTIP awards and unexercised stock options. Performance-based awards are included assuming maximum performance.

(2)The weighted average exercise price is calculated based solely on the outstanding stock options. It does not take into account the shares issuable upon vesting of outstanding time-based restricted stock, performance-based restricted stock, or LTIP awards, because such awards do not have an exercise price. As a result of the Separation the exercise price was adjusted by a ratio specified in the Employee Matters Agreement and reflects exercise price for a share of AIR Common Stock.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

Policies and Procedures for Review, Approval or Ratification of Related Person Transactions

AIR recognizes that related person transactions can present potential or actual conflicts of interest and create the appearance that Aimco's decisions are based on considerations other than the best interests of AIR and its stockholders. Accordingly, as a general matter, it is AIR's preference to avoid related person transactions. Nevertheless, AIR recognizes that there are situations where related person transactions may be in, or may not be inconsistent with, the best interests of AIR and its stockholders. The Nominating and Corporate Governance Committee, pursuant to a written policy approved by the Board, has oversight for related person transactions. The Nominating and Corporate Governance Committee will review transactions, arrangements or relationships in which (1) the aggregate amount involved will or may be expected to exceed $100,000 in any calendar year, (2) AIR (or any AIR entity) is a participant, and (3) any related party has or will have a direct or indirect interest (other than an interest arising solely as a result of being a director of another corporation or organization that is a party to the transaction or a less than 10 percent beneficial owner of another entity that is a party to the transaction). The Nominating and Corporate Governance Committee has also given its standing approval for certain types of related person transactions such as certain employment arrangements, director compensation, transactions with another entity in which a related person's interest is only by virtue of a non-executive employment relationship or limited equity position, and transactions in which all stockholders receive pro rata benefits.

Independence of Directors

The Board has determined that to be considered independent, an outside director may not have a direct or indirect material relationship with AIR or its subsidiaries (directly or as a partner, stockholder or officer of an organization that has a relationship with the Company). A material relationship is one that impairs or inhibits, or has the potential to impair or inhibit, a director's exercise of critical and disinterested judgment on behalf of AIR and its stockholders. In determining whether a material relationship exists, the Board considers all relevant facts and circumstances, including whether the director or a family member is a current or former employee of the Company, family member relationships, compensation, business relationships and payments, and charitable contributions between AIR and an entity with which a director is affiliated (as an executive officer, partner or substantial stockholder). In evaluating Ms. Sperling's independence, the Board considered that the Company is presently engaged with Trammell Crow Company, or TCC, in connection with a development, in an arrangement whereby TCC is providing services on a fee basis. The Board took into account the fact that Ms. Sperling is an independent contractor with TCC and that she is not involved in the project, that her compensation is not tied to the project, and that the fee that may be earned by TCC is fixed and limited in nature, may be paid over three years, if earned, and in any one year and in the aggregate is immaterial to both AIR and TCC. The Board consults with the Company's counsel to ensure that such determinations are consistent with all relevant securities and other laws and regulations regarding the definition of 'independent director,' including but not limited to those categorical standards set forth in Section 303A.02 of the listing standards of the New York Stock Exchange as in effect from time to time.

Consistent with these considerations, the board affirmatively has determined that Messrs. Keltner, Miller, Murphy, Rayis, and Stein and Mses. Nelson, Sperling and Tran are independent directors.

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ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

PRINCIPAL ACCOUNTANT FEES AND SERVICES

Principal Accountant Fees

Below is information on the fees billed for services rendered by Ernst & Young LLP during the years ended December 31, 2020, and 2019.

In selecting Ernst & Young LLP to perform tax compliance and tax consulting services, the Audit Committee evaluated the efficiency and expertise brought by Ernst & Young LLP and concluded that such engagement was in the best interest of the Company and its stockholders. The Audit Committee considered that the Company's current and continuing qualification as a real estate investment trust involves the application of highly technical and complex provisions of the Internal Revenue Code and depends on the Company's ability to meet the various requirements imposed by the Internal Revenue Code, through actual operating results, distribution levels, and diversity of stock ownership. The Audit Committee also specifically considered the amount of the fees as compared to the Company's overall engagement and as compared to Ernst & Young LLP's overall book of business and concluded that such engagement by the Company would have no negative bearing on Ernst & Young LLP's independence.

In its pre-approval of such tax services in accordance with the policies outlined below, the Audit Committee gave appropriate consideration to the applicable independence rules of the SEC and PCAOB. Specifically, the Audit Committee considered:

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In addition, The Audit Committee considered the SEC's Release, Strengthening the Commission's Requirements Regarding Auditor Independence, in which the SEC reiterated 'its long-standing position that an accounting firm can provide tax services to its audit clients without impairing the firm's independence.'

Audit Committee Pre-Approval Policies

The Audit Committee has adopted the Audit and Non-Audit Services Pre-Approval Policy (the 'Pre-approval Policy'). A summary of the Pre-approval Policy is as follows:

All of the services described in the Principal Accountant Fee section above were approved pursuant to the annual engagement letter or in accordance with the Pre-approval Policy.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, each registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of each registrant and in the capacities and on the dates indicated.

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