Mid-america Apartment Communities, Inc. · NYSE:MAA
Mid-america Apartment Communities — NAREIT Annual Meeting 2007
22 slides from Mid-america Apartment Communities's conference presentation, Nov 13, 2007
Slide 1: Investor Update, NAREIT Annual Meeting
Investor Update NAREIT Annual Meeting November 2007
Slide 2: Safe Harbor Disclosure
Safe Harbor Disclosure Statements contained in this presentation, which are not historical facts, are forward-looking statements, as the term is defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks and uncertainties which can cause act
Slide 3: Strong Public Company Platform
Strong Public Company Platform • – Experienced Public Company – IPO January 1994 – Exclusively multifamily • $3.0 billion total capitalization – High Quality Portfolio – Sunbelt - High Growth region focus – 137 communities; 40,248 units • High quality portfolio (avg age 14 yrs) – Strong Balance Shee
Slide 4: Focus on High Growth Region
Focus on High Growth Region • • Positive demographic flows Employment Growth Projections ’07 - ’11 • Positive migration, immigration flows Annual Compounded Growth Rates • Low business/living costs National MSA Average 1.20% • Pro-business regulatory environment Sunbelt Region MSA Average 1.77% • Ac
Slide 5: Well Positioned in High Growth Region
Well Positioned in High Growth Region • MAA is uniquely positioned to capture the Employment Growth Projections ’07 - ’11 strong fundamentals opportunity of the high growth • region Annual Compounded Growth Rates National Diversified in different market tiers within the MSA Average 1.20% region driv
Slide 6: Robust External Growth Platform
Robust External Growth Platform • – Acquisitions – Extensive network – High deal flow Competitive advantage • – Fund Management – Value add investments – Monetize platform value Higher return capital deployment • – New Development/Lease-Up – Unique value add opportunities – Attractive returns Improv
Slide 7: High Quality Portfolio
High Quality Portfolio MAA’s portfolio is newer than the sector average. Steady growth and recycling efforts continue to position MAA’s portfolio as one of the younger portfolios in the sector; solid long-term upside potential. Portfolio Age Units owned Post 10 19,222 Camden 10 53,502 Mid-America 14
Slide 8: Sophisticated Operating Platform
Sophisticated Operating Platform Collection Agency Collections • Management Integration; real-time Delinquency reporting Significant re-tooling of the Lease operating platform over the Revenue Training and 24/7 training availability; last four years Optimizer Procedures high degree of control; on-li
Slide 9: Proven Value Creation
Proven Value Creation Internal Rates of Return to equity from investments… through the full value creation cycle… have averaged 19.5% • Value creation opportunities in Sunbelt markets are competitive with other regions…for a regionally focused investor and operator • Almost $250MM of transactions th
Slide 10: Competitive Performance
Competitive Performance Strong Q3 Results; Fundamentals Appear Stable • • 11% increase in FFO • Same Store NOI up 7.1% FFO Per Share • Same Store revenues up 4.2% • Physical occupancy up 0.6%; 96.4% • Leasing traffic up 10% • New move-ins up 6% • Same store concessions down 26% • Effective pricing u
Slide 11: Upside Performance Opportunity
Upside Performance Opportunity The change in the mortgage environment is likely to generate a positive influence on the demand for apartment rentals • • Home ownership peaked in ’05 at 69% • Long-term historical average is 64% Encouraged by easy credit and expectations of price • inflation Mortgage
Slide 12: Upside Performance Opportunity
Upside Performance Opportunity Move outs to buy a home declined by 300 basis points in Q3; lowest level since 2001 • • – “Front Door” Benefit – “Back Door” Benefit – Increased traffic – Lower turnover – Higher occupancy – Lower vacancy loss Pricing opportunity Lower turn expenses 12
Slide 13: Property Redevelopment
Property Redevelopment Park Estate, Memphis. Case Study - Just over 60% of units redeveloped at an investment of $8K per unit; >30% IRR Before average rent = $852 After average rent = $1,123 13
Slide 14: Property Redevelopment
Property Redevelopment • Up to 20,000 units to be redeveloped at roughly $5,000 per unit • Based on current performance, expect to capture an average 13% un-leveraged IRR • 3,000 units to be completed by year end; 3,000 units planned in 2008 • Significant opportunity to drive higher internal growth
Slide 15: Value of Growth Platform
Value of Growth Platform MAA’s disciplined growth plan is expected to add to value per share* from five sources NPV/share Value Creation Plan of value created $150 MM/year of 100%-owned $1.25 acquisitions $150 MM/year of Fund I acquisitions $0.90 $50 MM/year of development $1.25 $15 MM/year of redev
Slide 16: Attractive Investment Opportunity
Attractive Investment Opportunity • Debt + Preferred/Entity Value • Strong Balance Sheet • Lower Risk Growth Strategy • Competitive Capacity to Support Growth Competitive Position to Support Dividend Growth • 83% of Debt is Fixed, Swapped or Hedged Construction In Process/Entity Value Dividend ’07E
Slide 17: Attractive Investment Opportunity
Attractive Investment Opportunity • – Competitive Operating Results – More robust market profile Improved operating platform • – Superior FFO Results – Steady growth Disciplined investment protocols 17
Slide 18: Attractive Investment Opportunity
Attractive Investment Opportunity • MAA’s history of discounted pricing to sector average pricing (~15%) – is now unwarranted Portfolio, platform and balance sheet changes have altered performance – profile IRR’s realized on capital “round trips” supports competitive performance for capital – Good p
Slide 19: Attractive Investment Opportunity
Attractive Investment Opportunity • • Significant discount to sector average pricing Spread between high-barrier and significant development platforms is too • large, especially when considering relative risks Achieving sector average pricing drives 23% upside opportunity FFO Multiple 19
Slide 20: Attractive Investment Opportunity
Attractive Investment Opportunity ü Proven Public Company Platform ü Portfolio Well Positioned ü Strong Operating Platform ü Disciplined Capital Allocation ü Solid Balance Sheet ü Strong Coverage Ratios ü Attractive Investment ü Proven Performer for Shareholders 20
Slide 21: End of Presentation
Apartment Communities
Slide 22: Slide 22
MID America Apartment Communities — NAREIT Annual Meeting 2007 on 6ix