Mid-america Apartment Communities, Inc. · NYSE:MAA
Mid-america Apartment Communities — Nareit's REITworld 2023 Annual Conference
38 slides from Mid-america Apartment Communities's conference presentation, Nov 13, 2023
Slide 1: Nareit's REITworld 2023 Annual Conference
Nareit’s REITworld 2023 Annual Conference NOVEMBER 14-15, 2023 Exhibit 99.1
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, with respect to our expectations for future periods. Forward-looking state
Slide 3: About MAA | Strong Performance Platform
About MAA | Strong Performance Platform 29 S&P 500 $20.3B 102K 2,400 21 YR YEARS PUBLIC MEMBER COMPANY TOTAL MARKET CAP APARTMENT UNITS ASSOCIATES AVG EXEC TENURE $800M 14K A3/A- 3.4x 9.7% 119 ’23F TOTAL DEVELOPMENT, LU PIPELINE UNIT OPPORTUNITY REDEVELOPMENT PROGRAM MOODY’S CREDIT RATING UPGRADE ON
Slide 4: Consistently Strong Performance for Shareholders
Consistently Strong Performance for Shareholders Steady Annual Core FFO per Share Growth Consistent and compounding Core FFO and dividend growth through market cycles; high quality earnings stream Strong dividend track record; steady growth and well-covered Top tier long-term shareholder returns wit
Slide 5: Differentiated Portfolio Strategy
Differentiated Portfolio Strategy Unique market focus…captures benefits of high growth and demand Submarket and property type/class diversification helps to lessen periodic supply-side pressures… drives superior, long-term and full-cycle performance Diversified renter price point… appeals to largest
Slide 6: Top Markets | Unique Diversification and Balance
TOP 10 MARKETS | % 3Q 2023 Same Store NOI TOP 10 MARKETS 1 Atlanta, GA 12.7% 6 Austin, TX 6.1% 2 Dallas, TX 10.0% 7 Raleigh/Durham, NC 5.6% 3 Tampa, FL 6.9% 8 Nashville, TN 4.9% 4 Orlando, FL 6.7% 9 Charleston, SC 3.7% 5 Charlotte, NC 6.4% 10 Houston, TX 3.5% Unique Diversification and Balance 1 Bas
Slide 7: A Proven Portfolio Strategy for Long-Term Growth and Stability
A Proven Portfolio Strategy for Long-Term Growth and Stability Our diverse portfolio of high-quality properties appeals to the largest segment of the rental market Our portfolio strategy drives long-term growth and greater stability through the full market cycle + Repositioned | MAA Worthington | Da
Slide 8: Steady Demand Drivers for MAA Markets
Steady Demand Drivers for MAA Markets Move-ins from Non-MAA States Trailing 12 Months at 9/30/2023 CA | NY | IL | NJ | MA | WA 48% Of Move-ins from Non-MAA States Came from Peer Coastal/Gateway States MAA markets continue to capture positive in-migration trends that continue to run higher than pre-p
Slide 9: Robust Job Creation in MAA Markets Continues
Robust Job Creation in MAA Markets Continues Georgia ATLANTA Hyundai-SK EV Battery Plant 3,500 Jobs | $4.5B Investment SAVANNAH Hyundai Group Meta Plant EV & Battery Plant 8,100 Jobs | $5.5B Investment Texas AUSTIN Samsung Electronics Co Chip Plant 2,000 Jobs | $25B Investment DALLAS/FORT WORTH Texa
Slide 10: Same Store Resident Profile in Top Markets
SAME STORE RESIDENT PROFILE IN TOP MARKETS QTD AT 9/30/2023 AVG NEW RESIDENT INCOME AVG NEW LEASE RENT/ INCOME RESIDENT MED AGE RESIDENT % SINGLE TOP 5 EMPLOYMENT SECTORS 1 2 3 4 5 Atlanta, GA $101,936 21% 33 82% Dallas, TX $94,258 21% 32 83% Tampa, FL $99,782 24% 36 79% Orlando, FL $98,900 23% 38 6
Slide 11: Submarket and Property Class Diversification
Submarket and Property Class Diversification MAA’s diversification across many submarkets and property types helps mitigate our exposure during this high supply period. Submarket Supply Look1 MAA rents average approximately $300/unit less than new supply in our submarkets; driving a better value pro
Slide 12: MAA Supply Exposure by Top Markets
All MAA Markets No. MAA Markets/Submarkets MAA Expected High Supply Submarket Exposure1 Price Gap2 Oct YTD Blended Pricing Growth3 35/151 33% $305 / 18% 2.6% Top MAA Markets BY 3Q23 SS NOI No. MAA Submarkets v. Total Submarkets in Market MAA Expected High Supply Submarket Exposure1 Price Gap2 Oct YT
Slide 13: Strong Performance Through the Full Economic Cycle
Strong Performance Through the Full Economic Cycle MAA continues to deliver on its mission to drive long-term outperformance through all phases of the economic cycle with less volatility Our outperformance compared to Multifamily Peers2 during the latest down cycle and recovery period positions us w
Slide 14: 2023 Same Store Pricing Trends
2023 Same Store Pricing Trends Lease Over Lease Average Pricing Growth same store 1Q 2023 2Q 2023 3q 2023 OCT 2023 oct ytd 2023 EFFECTIVE LEASES NEW LEASE -0.5% 0.5% -2.2% -5.9% -1.2% RENEWAL 8.6% 6.8% 5.0% 4.4% 6.2% BLENDED 3.9% 3.8% 1.6% -0.6% 2.6% Occupancy SAME STORE 1Q 2023 2q 2023 3q 2023 OCT
Slide 15: Full Year 2023 Same Store Outlook
Property Revenue Growth [5.75% … 6.25% … 6.75%] Effective Rent Growth1 [6.75% … 7.00% … 7.25%] Average Physical Occupancy Steady occupancy expected for full year [95.5% … 95.6% … 95.7%] Full Year 2023 Same Store Outlook REVENUE Property Expense Growth [6.00% … 6.50% … 7.00%] Real Estate Tax Growth [
Slide 16: 2023 Core FFO and Investment Outlook
2023 Core FFO and Investment Outlook Full Year 20232 [$9.06 … $9.14 … $9.22] Q4 20233 [$2.21 … $2.29 … $2.37] Total Overhead Corporate Property Management + G&A [$124.5M … $126.5M … $128.5M] Income Tax [$4.0M … $4.5M … $5.0M] EXPECTED CORE FFO/SHARE1 Midpoint represents approximately 7.5% increase o
Slide 17: Key Variables & Initial Outlook for 2024
Key Variables & Initial Outlook for 20241 Revenue Considerations EARN-IN Based on current pricing; expected range of 0.75% - 1.25% BLENDED PRICING Full year expectation in 1.0% - 1.5% range COLLECTIONS Expected to remain strong in range of 99.25% - 99.5% OCCUPANCY Expected to remain consistent at 95
Slide 18: Development Program Supports Continued Value Creation
Development Program Supports Continued Value Creation PHOENIX, AZ Novel Val Vista ATLANTA, GA Novel West Midtown SALT LAKE CITY, UT Novel Daybreak DENVER, CO MAA Milepost 35 I RALEIGH, NC MAA Nixie Combination of In-House and Joint Venture* “Pre-Purchased” Development Expands Revenue Growth Potentia
Slide 19: Development Pipeline and Lease-ups Poised To Deliver Value
Development Pipeline and Lease-ups Poised To Deliver Value ACTIVE DEVELOPMENTS AT 9/30/2023 PROPERTY MSA TOTAL UNITS EXPECTED TOTAL COST (IN MILLIONS) EXPECTED INITIAL OCCUPANCY EXPECTED STABILIZATION1 Novel Daybreak2,3 Salt Lake City, UT 400 $ 97.5 2Q 2023 4Q 2024 Novel Val Vista2,3 Phoenix, AZ 317
Slide 20: 2024 Development Expectations
2024 Development Expectations msa Units STATUS Charlotte, NC 302 Owned Denver, CO 259 Owned Phoenix, AZ 345 Controlled Orlando, FL 308 Owned Denver, CO 181 Owned Atlanta, GA 250 Controlled Raleigh, NC 191 Controlled Denver, CO 648 Owned Denver, CO 520 Owned Atlanta, GA 294 Owned Orlando, FL 390 Owne
Slide 21: Unit Interior Upgrades Continues to Drive Higher Value
Unit Interior Upgrades Continues to Drive Higher Value Property Redevelopment Program Opportunity Approximately 14K units identified for redevelopment across Same Store portfolio with potential to create additional rent growth value SCOPE Redevelopments are performed on turn at select communities (p
Slide 22: Future Redevelopment Opportunity
Future Redevelopment Opportunity Potential for Continued Value Creation Remains MAA REDEVELOPMENT PIPELINE Currently Identified Redevelopment Opportunity Future Value Opportunity Revenue At 5.9% Cap Rate1 Net Value Creation $19.7M $333.9M $244.4M Legacy MAA Legacy CLP Legacy PPS Total MAA Units 5,10
Slide 23: Repositioning Select Properties to Drive Additional Value
Repositioning Select Properties to Drive Additional Value MAA Harbour Island | Tampa, FL Updated and Expanded Fitness Centers Co-working Areas to Support Remote Work Desirable Amenities MAA Gardens |Atlanta, GA MAA Gateway (Pet Spa) | Charlotte, NC Exterior Amenities for Today’s Lifestyles MAA Worth
Slide 24: Technology Advances Enhance Operations and Add Value
Technology Advances Enhance Operations and Add Value Mobile control of locks, lights and thermostat as well as leak detection provides additional resident value Additional synergy opportunities in repairs and maintenance, capex, and vacant and house electric charges Continued upgrades and expansion
Slide 25: MAA's Technology Enhancements Expand, Upgrade Leasing Toolbox
MAA’s Technology Enhancements Expand, Upgrade Leasing Toolbox Objective to create a multi-functional and fully integrated self-service/self-touring leasing platform that results in a seamless, easy to use process for the entire resident journey Technology rollout staggered with careful piloting of c
Slide 26: Strong, Investment-Grade Balance Sheet
Strong, Investment-Grade Balance Sheet Note: Total Capitalization is defined here as common shares and units outstanding multiplied by the closing stock price on 9/30/2023, plus total debt outstanding at 9/30/2023, plus Preferred stock ($50 redeemable stock price multiplied by total shares outstandi
Slide 27: Balance Sheet Strength Positions Us Well for Future Growth
Balance Sheet Strength Positions Us Well for Future Growth Opportunities DEBT MATURING 8.0% 9.1% 9.1% 6.8% 13.6% 9.0% 12.7% 6.8% 10.1% 0% 14.8% Credit metrics At 9/30/2023 MAA SECTOR AVG2,3 Total debt / adjusted total assets1 27.3% 30.2% Total secured debt / adjusted total assets1 2.2% 4.3% Unencumb
Slide 28: Our Sustainability Commitment
A Brighter View for Today and Tomorrow: Our Sustainability Commitment 2023 GRESB Public Disclosure Score A 78 100 28 30 50 70 2023 GRESB SCORE THREE GREEN STARS MANAGEMENT SCORE PERFORMANCE SCORE ENERGY USE INTENSITY 15% GREEN HOUSE GAS INTENSITY 15% WATER USE INTENSITY 10% 2018 – 2028 REDUCTION GOA
Slide 29: Supporting Associate Well-Being
SUPPORTING ASSOCIATE WELL-BEING A Brighter View for Today and Tomorrow: Our Sustainability Commitment Responsive service program and routine surveys Online resident portal for ease of transactions, service request submission and communication Property amenities to promote healthy lifestyles Ongoing
Slide 30: Appendix
Appendix At SEPTEMBER 30, 2023 Reconciliation of Non-GAAP Financial Measures Definitions of Non-GAAP Financial Measures and Other Key Terms
Slide 31: Reconciliation of FFO, Core FFO, Core AFFO and FAD
Reconciliation of Non-GAAP Financial Measures RECONCILIATION OF FFO, CORE FFO, CORE AFFO AND FAD TO NET INCOME AVAILABLE FOR MAA COMMON SHAREHOLDERS Included in Other non-operating expense (income) in the Consolidated Statements of Operations. For the three months ended September 30, 2023 and 2022 a
Slide 32: Reconciliation of Net Operating Income to Net Income
Reconciliation of Non-GAAP Financial Measures RECONCILIATION OF NET OPERATING INCOME TO NET INCOME AVAILABLE FOR MAA COMMON SHAREHOLDERS Dollars in thousands Three Months Ended Nine Months Ended September 30, 2023 June 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Net Operating I
Slide 33: Reconciliation of EBITDA, EBITDAre and Adjusted EBITDAre
Reconciliation of Non-GAAP Financial Measures RECONCILIATION OF EBITDA, EBITDAre AND ADJUSTED EBITDAre TO NET INCOME Included in Other non-operating expense (income) in the Consolidated Statements of Operations. For the three months ended September 30, 2022 and twelve months ended September 30, 2023
Slide 34: Reconciliation of Net Debt, Gross Assets and Real Estate Assets
Reconciliation of Non-GAAP Financial Measures RECONCILIATION OF NET DEBT TO UNSECURED NOTES PAYABLE AND SECURED NOTES PAYABLE RECONCILIATION OF GROSS ASSETS TO TOTAL ASSETS RECONCILIATION OF GROSS REAL ESTATE ASSETS TO REAL ESTATE ASSETS, NET Included in Restricted cash in the Consolidated Balance S
Slide 35: Reconciliation of Net Income per Share to Core FFO for 2023 Guidance
Reconciliation of Non-GAAP Financial Measures RECONCILIATION OF NET INCOME PER DILUTED COMMON SHARE TO CORE FFO PER SHARE FOR 2023 GUIDANCE Non-Core FFO items may include adjustments related to the fair value of the embedded derivative in the MAA Series I preferred shares, gain or loss on sale of no
Slide 36: Definitions of Non-GAAP Financial Measures
Definitions of Non-GAAP Financial Measures Adjusted EBITDAre For purposes of calculations in this release, Adjusted Earnings Before Interest, Income Taxes, Depreciation and Amortization for real estate, or Adjusted EBITDAre, represents EBITDAre further adjusted for items that are not considered part
Slide 37: Definitions of Non-GAAP Financial Measures: FAD
Definitions of Non-GAAP Financial Measures Funds Available for Distribution (FAD) FAD is composed of Core FFO less total capital expenditures, excluding development spending, property acquisitions, capital expenditures relating to significant casualty losses that management expects to be reimbursed
Slide 38: Definitions of Non-GAAP Financial Measures and Other Key Terms
Definitions of Non-GAAP Financial Measures and Other Key Terms Same Store NOI Same Store NOI represents Rental and other property revenues less Total property operating expenses, excluding depreciation and amortization, for all properties classified within the Same Store Portfolio during the period.
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