MAA REPORTS THIRD QUARTER 2024 RESULTS
MAA reported Q3 2024 results with earnings per share of $0.98, up from $0.94 in Q3 2023. The company's Same Store Portfolio maintained strong occupancy at 95.7%, while revenue growth was flat year-over-year. Property operating expenses increased by 3.0%, leading to a 1.7% decrease in Net Operating Income. During Q3, MAA acquired a 310-unit community in Orlando and had eight communities under development. The company's balance sheet remains strong with a Net Debt/Adjusted EBITDAre ratio of 3.9x and $805.7 million in available cash and credit capacity. Resident turnover remained historically low at 42.8%, with record-low move-outs to single-family homes.
MAA ha riportato i risultati del terzo trimestre 2024 con utili per azione pari a $0,98, in aumento rispetto a $0,94 nel terzo trimestre 2023. Il portafoglio Same Store dell'azienda ha mantenuto un'occupazione forte al 95,7%, mentre la crescita dei ricavi è rimasta stabile rispetto all'anno precedente. Le spese operative per la proprietà sono aumentate del 3,0%, portando a una riduzione del 1,7% nel Reddito Operativo Netto. Durante il terzo trimestre, MAA ha acquisito una comunità di 310 unità a Orlando e ha otto comunità in fase di sviluppo. Il bilancio dell'azienda rimane robusto, con un rapporto Debito Netto/EBITDAre aggiustato di 3,9x e $805,7 milioni in disponibilità liquide e capacità di credito. Il turnover degli inquilini è rimasto storicamente basso al 42,8%, con un numero record di trasferimenti verso case monofamiliari.
MAA reportó resultados del tercer trimestre de 2024 con ganancias por acción de $0.98, un aumento desde $0.94 en el tercer trimestre de 2023. El portafolio Same Store de la compañía mantiene una fuerte ocupación de 95.7%, mientras que el crecimiento de ingresos se mantuvo plano en comparación con el año anterior. Los gastos operativos de propiedad aumentaron en 3.0%, lo que llevó a una disminución del 1.7% en el Ingreso Operativo Neto. Durante el tercer trimestre, MAA adquirió una comunidad de 310 unidades en Orlando y tenía ocho comunidades en desarrollo. El balance de la compañía sigue siendo sólido, con una relación Deuda Neta/EBITDAre ajustado de 3.9x y $805.7 millones en efectivo disponible y capacidad de crédito. La rotación de residentes se mantuvo históricamente baja en 42.8%, con un número récord de mudanzas a casas unifamiliares.
MAA는 2024년 3분기 실적을 보고하며 주당 순이익이 $0.98로, 2023년 3분기 $0.94에서 증가했습니다. 회사의 동일 매장 포트폴리오는 95.7%의 높은 점유율을 유지했으며, 매출 성장률은 전년 대비 변동이 없었습니다. 부동산 운영 비용은 3.0% 증가했으며, 이는 순 운영 소득의 1.7% 감소로 이어졌습니다. 3분기 동안 MAA는 올랜도에서 310개 유닛 커뮤니티를 인수하였고, 8개의 커뮤니티가 개발 중이었습니다. 회사의 재무 상태는 매우 견고하며 순 부채/조정 EBITDAre 비율은 3.9배, 사용 가능한 현금 및 신용 용량은 $805.7백만입니다. 거주자 이직률은 역사적으로 낮은 42.8%로 유지되었으며, 단독 주택으로의 이동 또한 최저 수준에 달했습니다.
MAA a annoncé les résultats du troisième trimestre 2024 avec un bénéfice par action de 0,98 $, en hausse par rapport à 0,94 $ au troisième trimestre 2023. Le portefeuille Same Store de l'entreprise a maintenu un fort taux d'occupation de 95,7 %, tandis que la croissance des revenus est restée stagnante d'une année sur l'autre. Les dépenses opérationnelles des propriétés ont augmenté de 3,0 %, entraînant une diminution de 1,7 % du Revenu Net d'Exploitation. Au cours du troisième trimestre, MAA a acquis une communauté de 310 unités à Orlando et avait huit communautés en développement. La situation financière de l'entreprise reste solide avec un ratio Dette Nette/EBITDAre ajusté de 3,9x et 805,7 millions de dollars en liquidités disponibles et capacité de crédit. Le taux de rotation des résidents est resté historiquement bas à 42,8 %, avec un nombre record de déménagements vers des maisons unifamiliales.
MAA berichtete im dritten Quartal 2024 von Gewinnen pro Aktie in Höhe von $0,98, ein Anstieg von $0,94 im dritten Quartal 2023. Das Same Store Portfolio des Unternehmens hielt eine starke Belegung von 95,7%, während das Umsatzwachstum im Jahresvergleich stagnierte. Die Betriebskosten für Immobilien stiegen um 3,0%, was zu einem Rückgang des Netto-Betriebseinkommens um 1,7% führte. Im dritten Quartal erwarb MAA eine Gemeinschaft mit 310 Einheiten in Orlando und hatte acht Gemeinschaften in der Entwicklung. Die Bilanz des Unternehmens bleibt stark mit einer Netto-Schulden/Adjustierte EBITDAre-Ratio von 3,9x und $805,7 Millionen an verfügbarem Bargeld und Kreditkapazität. Die Fluktuation der Bewohner blieb historisch niedrig bei 42,8%, mit einem Rekord an Umzügen in Einfamilienhäuser.
- Earnings per share increased to $0.98 from $0.94 year-over-year
- Strong occupancy maintained at 95.7%
- Record low resident turnover at 42.8%
- Strong renewal lease pricing growth of 4.1%
- Robust development pipeline with 8 communities under construction
- Same Store Portfolio NOI decreased by 1.7%
- Property operating expenses increased by 3.0%
- New lease pricing declined by 5.4%
- Core FFO per Share decreased to $2.21 from $2.29 year-over-year
- Average Effective Rent per Unit declined 0.4%
Insights
MAA's Q3 2024 results show mixed performance in a challenging market environment. Core FFO per share declined to
Key positives include strong lease renewal pricing (up
The company's strategic acquisitions in Orlando and Dallas, coupled with the expected decline in new supply in 2025, position MAA for potential growth. The updated guidance maintains Core FFO expectations at
Third Quarter 2024 Operating Results | Three months ended | Nine months ended | ||||||||||||||
2024 | 2023 | 2024 | 2023 | |||||||||||||
Earnings per common share - diluted | $ | 0.98 | $ | 0.94 | $ | 3.07 | $ | 3.34 | ||||||||
Funds from operations (FFO) per Share - diluted | $ | 2.10 | $ | 2.16 | $ | 6.57 | $ | 6.85 | ||||||||
Core FFO per Share - diluted | $ | 2.21 | $ | 2.29 | $ | 6.65 | $ | 6.85 | ||||||||
A reconciliation of Net income available for MAA common shareholders to FFO and Core FFO, and discussion of the components of FFO and Core FFO, can be found later in this release. FFO per Share – diluted and Core FFO per Share – diluted include diluted common shares and units.
Eric Bolton, Chairman and Chief Executive Officer, said, "We continue to see strong demand for apartment housing, which is contributing to the steady absorption of the high volume of new supply delivered in the third quarter, which we believe has now peaked. Resident turnover is at record low levels, lease renewal pricing is strong, occupancy is steady, and collections also remain strong. We are confident that in calendar year 2025 we will see a meaningful decline in the amount of new supply impacting our portfolio, and we will enter a new multi-year cycle with demand outpacing supply. The upside opportunity within our current portfolio from these changing market conditions, coupled with the growing contribution from our new development and acquisitions pipeline, has MAA very well positioned."
Highlights
- During the third quarter of 2024, MAA's Same Store Portfolio captured strong Average Physical Occupancy of
95.7% , matching the performance in the same period in the prior year. During the third quarter of 2024, MAA's Same Store Portfolio produced flat revenue growth, as compared to the same period in the prior year, with Average Effective Rent per Unit down0.4% , offset by a2.6% increase in other property revenues. - During the third quarter of 2024, MAA's Same Store Portfolio property operating expense increased by
3.0% and MAA's Same Store Portfolio Net Operating Income (NOI) decreased by1.7% , in each case as compared to the same period in the prior year. - As of September 30, 2024, resident turnover remained historically low at
42.8% on a trailing twelve month basis with a record low level of move-outs associated with buying single family-homes. - During the third quarter of 2024, MAA acquired a newly built 310-unit multifamily apartment community in initial lease-up located in
Orlando, Florida . Subsequent to the end of the third quarter of 2024, MAA acquired a 386-unit multifamily community located inDallas, Texas . - Subsequent to the end of the third quarter of 2024, MAA closed on the disposition of a 216-unit multifamily community located in
Charlotte, North Carolina . - As of September 30, 2024, MAA had eight communities under development, representing 2,762 units once complete, with a projected total cost of
$978.3 million $367.9 million Richmond, Virginia . Also during the third quarter of 2024, MAA agreed to finance a third party's development of a 239-unit multifamily apartment community currently under construction located inCharlotte, North Carolina . During the third quarter of 2024, MAA completed the development of Novel Daybreak, located in theSalt Lake City, Utah market. - As of September 30, 2024, MAA had two recently completed development communities and three recently acquired communities in lease-up. Two communities are expected to stabilize in the fourth quarter of 2024, one is expected to stabilize in the first quarter of 2025 and two are expected to stabilize in the second quarter of 2025. During the third quarter of 2024, MAA completed the lease-up of MAA Central Avenue, located in
Phoenix, Arizona . - MAA's balance sheet remains strong with a Net Debt/Adjusted EBITDAre ratio of 3.9x and
$805.7 million
Same Store Portfolio Operating Results
To ensure comparable reporting with prior periods, the Same Store Portfolio includes properties that were owned by MAA and stabilized at the beginning of the previous year. Same Store Portfolio results for the three and nine months ended September 30, 2024 as compared to the same periods in the prior year are summarized below:
Three months ended September 30, 2024 vs. 2023 | Nine months ended September 30, 2024 vs. 2023 | |||||||||||||||||||
Revenues | Expenses | NOI | Average Effective Rent per Unit | Revenues | Expenses | NOI | Average Effective Rent per Unit | |||||||||||||
Same Store Operating Growth | 0.0 % | 3.0 % | (1.7) | % | (0.4) % | 0.7 % | 4.0 % | (1.1) | % | 0.6 % | ||||||||||
A reconciliation of Net income available for MAA common shareholders to NOI, including Same Store NOI, and discussion of the components of NOI, can be found later in this release.
Same Store Portfolio operating statistics for the three and nine months ended September 30, 2024 are summarized below:
Three months ended September 30, 2024 | Nine months ended September 30, 2024 | September 30, 2024 | ||||||||||||
Average Effective Rent | Average Physical Occupancy | Average | Average Physical Occupancy | Resident Turnover | ||||||||||
Same Store Operating Statistics | $ | 1,691 | 95.7 % | $ | 1,690 | 95.5 % | 42.8 % | |||||||
Same Store Portfolio lease pricing for new leases that were effective during the third quarter of 2024 declined
Same Store Portfolio lease pricing for both new and renewing leases effective during the nine months ended September 30, 2024, on a blended basis, declined
Brad Hill, President and Chief Investment Officer, said, "Despite the record level of new apartment deliveries in many of our markets, we are encouraged by the momentum we are beginning to see, and as we approach the slower winter leasing season, where only
Acquisition and Disposition Activity
In September 2024, MAA acquired a 310-unit multifamily community currently in lease-up and located in
In October 2024, MAA acquired a 386-unit multifamily community located in
Development and Lease-up Activity
A summary of MAA's development communities under construction as of the end of the third quarter of 2024 is set forth below (dollars in thousands):
Units as of | Development Costs as of | Expected Project | ||||||||||||||||||||||||||||||||||||||||
Total | September 30, 2024 | September 30, 2024 | Completions By Year | |||||||||||||||||||||||||||||||||||||||
Development | Expected | Spend | Expected | |||||||||||||||||||||||||||||||||||||||
Projects (1) | Total | Delivered | Leased | Total | to Date | Remaining | 2024 | 2025 | 2026 | 2027 | ||||||||||||||||||||||||||||||||
8 | 2,762 | 506 | 356 | $ | 978,300 | $ | 610,370 | $ | 367,930 | 2 | 2 | 3 | 1 | |||||||||||||||||||||||||||||
(1) | Three of the development projects are currently leasing. |
During the third quarter of 2024, MAA funded approximately
In July 2024, MAA agreed to finance a third party's development of a 239-unit multifamily apartment community currently under construction located in
In September 2024, MAA started construction on a 306-unit multifamily apartment community located in
A summary of the total units, physical occupancy and cost of MAA's lease-up communities as of the end of the third quarter of 2024 is set forth below (dollars in thousands):
Total | As of September 30, 2024 | |||||||||||||
Lease-Up | Total | Physical | Spend | |||||||||||
Projects (1) | Units | Occupancy | to Date | |||||||||||
5 | 1,708 | 76.2 | % | $ | 457,837 | |||||||||
(1) | Two of the lease-up projects are expected to stabilize in the fourth quarter of 2024, one in the first quarter of 2025 and two in the second quarter of 2025. |
Property Redevelopment and Repositioning Activity
A summary of MAA's interior redevelopment program as of the end of the third quarter of 2024 is set forth below:
As of September 30, 2024 | |||||||||||||
Units | Average Cost | Increase in Average | |||||||||||
Completed | per Unit | Effective Rent per Unit | |||||||||||
YTD | YTD | YTD | |||||||||||
Redevelopment | 4,535 | $ | 6,406 | $ | 107 | ||||||||
As of September 30, 2024, MAA had completed installation of Smart Home technology (unit entry locks, mobile control of lights and thermostat and leak monitoring) in over 94,000 units across its apartment community portfolio providing an increase in Average Effective Rent per Unit of approximately
During the third quarter of 2024, MAA continued its property repositioning program to upgrade and reposition the amenity and common areas at select apartment communities for higher and above market rent growth after projects are completed and units are fully repriced. For the nine months ended September 30, 2024, MAA spent
Capital Expenditures
A summary of MAA's capital expenditures and Funds Available for Distribution (FAD) for the three and nine months ended September 30, 2024 and 2023 is set forth below (dollars in millions, except per Share data):
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
2024 | 2023 | 2024 | 2023 | |||||||||||||
Core FFO attributable to common shareholders and unitholders | $ | 264.8 | $ | 274.9 | $ | 797.6 | $ | 820.4 | ||||||||
Recurring capital expenditures | (33.6) | (36.4) | (88.8) | (85.4) | ||||||||||||
Core Adjusted FFO (Core AFFO) attributable to common shareholders and unitholders | 231.2 | 238.5 | 708.8 | 735.0 | ||||||||||||
Redevelopment, revenue enhancing, commercial and other capital expenditures | (60.1) | (47.5) | (145.8) | (156.3) | ||||||||||||
FAD attributable to common shareholders and unitholders | $ | 171.1 | $ | 191.0 | $ | 563.0 | $ | 578.7 | ||||||||
Core FFO per Share - diluted | $ | 2.21 | $ | 2.29 | $ | 6.65 | $ | 6.85 | ||||||||
Core AFFO per Share - diluted | $ | 1.93 | $ | 1.99 | $ | 5.91 | $ | 6.14 | ||||||||
A reconciliation of Net income available for MAA common shareholders to FFO, Core FFO, Core AFFO and FAD, and discussion of the components of FFO, Core FFO, Core AFFO and FAD, can be found later in this release.
Balance Sheet and Financing Activities
As of September 30, 2024, MAA had
Dividends and distributions paid on shares of common stock and noncontrolling interests during the third quarter of 2024 were
Balance sheet highlights as of September 30, 2024 are summarized below (dollars in billions):
Total debt to adjusted | Net Debt/Adjusted | Total debt outstanding | Average effective | Fixed rate debt as a % | Total debt average | |||||||||
28.7 % | 3.9x | $ | 4.9 | 3.8 % | 90.0 % | 7.0 | ||||||||
(1) | As defined in the covenants for the bonds issued by MAALP. |
(2) | Adjusted EBITDAre is calculated for the trailing twelve month period ended September 30, 2024. |
A reconciliation of Unsecured notes payable and Secured notes payable to Net Debt and a reconciliation of Net income to Adjusted EBITDAre, along with discussion of the components of Net Debt and Adjusted EBITDAre, can be found later in this release.
123rd Consecutive Quarterly Common Dividend Declared
MAA declared its 123rd consecutive quarterly common dividend, which will be paid on October 31, 2024 to holders of record on October 15, 2024. The current annual dividend rate is
2024 Earnings and Same Store Portfolio Guidance
MAA is updating its prior 2024 guidance for Earnings per diluted common share, Core FFO per diluted Share, Core AFFO per diluted Share and Same Store performance. MAA expects to update its 2024 Earnings per diluted common share, Core FFO per diluted Share and Core AFFO per diluted Share guidance on a quarterly basis.
FFO, Core FFO and Core AFFO are non-GAAP financial measures. Acquisition and disposition activity materially affects depreciation and capital gains or losses, which combined, generally represent the majority of the difference between Net income available for common shareholders and FFO. As discussed in the definitions of non-GAAP financial measures found later in this release, MAA's definition of FFO is in accordance with the National Association of Real Estate Investment Trusts', or NAREIT's, definition, and Core FFO represents FFO as adjusted for items that are not considered part of MAA's core business operations. MAA believes that Core FFO is helpful in understanding operating performance in that Core FFO excludes not only depreciation expense of real estate assets and certain other non-routine items, but it also excludes certain items that by their nature are not comparable over periods and therefore tend to obscure actual operating performance.
2024 Guidance | Previous Range | Previous Midpoint | Revised Range | Revised Midpoint | ||||
Earnings: | Full Year 2024 | Full Year 2024 | Full Year 2024 | Full Year 2024 | ||||
Earnings per common share - diluted | ||||||||
Core FFO per Share - diluted | ||||||||
Core AFFO per Share - diluted | ||||||||
MAA Same Store Portfolio: | ||||||||
Property revenue growth | 0.65 % | 0.50 % | ||||||
Property operating expense growth | 4.25 % | 3.75 % | ||||||
NOI growth | - | -1.30 % | - | -1.30 % |
MAA expects Core FFO for the fourth quarter of 2024 to be in the range of
Core FFO per diluted Share | ||||
Q3 2024 reported results | $ | 2.21 | ||
Same Store Revenues | (0.03) | |||
Same Store Expenses | 0.07 | |||
Non-Same Store NOI (1) | 0.01 | |||
General and administrative expenses | (0.01) | |||
Interest expense and Other non-operating (expense) income | (0.02) | |||
Q4 2024 guidance midpoint | $ | 2.23 | ||
(1) | Non-Same Store NOI results for the third quarter of 2024 included |
MAA does not forecast Earnings per diluted common share on a quarterly basis as MAA generally cannot predict the timing of forecasted acquisition and disposition activity within a particular quarter (rather than during the course of the full year). Additional details and guidance items are provided in the Supplemental Data to this release.
Supplemental Material and Conference Call
Supplemental Data to this release can be found on the "For Investors" page of the MAA website at www.maac.com. MAA will host a conference call to further discuss third quarter results on October 31, 2024, at 9:00 AM Central Time. The conference call-in number is (800) 715-9871. You may also join the live webcast of the conference call by accessing the "For Investors" page of the MAA website at www.maac.com. MAA's filings with the Securities and Exchange Commission (SEC) are filed under the registrant names of Mid-America Apartment Communities, Inc. and Mid-America Apartments, L.P.
About MAA
MAA, an S&P 500 company, is a real estate investment trust (REIT) focused on delivering full-cycle and superior investment performance for shareholders through the ownership, management, acquisition, development and redevelopment of quality apartment communities primarily in the Southeast, Southwest and Mid-Atlantic regions of
Forward-Looking Statements
Sections of this release contain 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 statements do not discuss historical fact, but instead include statements related to expectations, projections, intentions or other items related to the future. Such forward-looking statements include, without limitation, statements regarding expected operating performance and results, property stabilizations, property acquisition and disposition activity, joint venture activity, development and renovation activity and other capital expenditures, and capital raising and financing activity, as well as lease pricing, revenue and expense growth, occupancy, interest rate and other economic expectations. Words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates," "forecasts," "projects," "assumes," "will," "may," "could," "should," "budget," "target," "outlook," "proforma," "opportunity," "guidance" and variations of such words and similar expressions are intended to identify such forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other factors, as described below, which may cause our actual results, performance or achievements to be materially different from the results of operations, financial conditions or plans expressed or implied by such forward-looking statements. Although we believe that the assumptions underlying the forward-looking statements contained herein are reasonable, any of the assumptions could be inaccurate, and therefore such forward-looking statements included in this release may not prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by us or any other person that the results or conditions described in such statements or our objectives and plans will be achieved.
The following factors, among others, could cause our actual results, performance or achievements to differ materially from those expressed or implied in the forward-looking statements:
- inability to generate sufficient cash flows due to unfavorable economic and market conditions, changes in supply and/or demand, competition, uninsured losses, changes in tax and housing laws, or other factors;
- exposure to risks inherent in investments in a single industry and sector;
- adverse changes in real estate markets, including, but not limited to, the extent of future demand for multifamily units in our significant markets, barriers of entry into new markets which we may seek to enter in the future, limitations on our ability to increase or collect rental rates, competition, our ability to identify and consummate attractive acquisitions or development projects on favorable terms, our ability to consummate any planned dispositions in a timely manner on acceptable terms, and our ability to reinvest sale proceeds in a manner that generates favorable returns;
- failure of development communities to be completed within budget and on a timely basis, if at all, to lease-up as anticipated or to achieve anticipated results;
- unexpected capital needs;
- material changes in operating costs, including real estate taxes, utilities and insurance costs, due to inflation and other factors;
- inability to obtain appropriate insurance coverage at reasonable rates, or at all, losses due to uninsured risks, deductibles and self-insured retentions, or losses from catastrophes in excess of coverage limits;
- ability to obtain financing at favorable rates, if at all, or refinance existing debt as it matures;
- level and volatility of interest or capitalization rates or capital market conditions;
- the effect of any rating agency actions on the cost and availability of new debt financing;
- the impact of adverse developments affecting the
U.S. or global banking industry, including bank failures and liquidity concerns, which could cause continued or worsening economic and market volatility, and regulatory responses thereto; - significant change in the mortgage financing market or other factors that would cause single-family housing or other alternative housing options, either as an owned or rental product, to become a more significant competitive product;
- ability to continue to satisfy complex rules in order to maintain our status as a REIT for federal income tax purposes, the ability of MAALP to satisfy the rules to maintain its status as a partnership for federal income tax purposes, the ability of our taxable REIT subsidiaries to maintain their status as such for federal income tax purposes, and our ability and the ability of our subsidiaries to operate effectively within the limitations imposed by these rules;
- inability to attract and retain qualified personnel;
- cyber liability or potential liability for breaches of our or our service providers' information technology systems, or business operations disruptions;
- potential liability for environmental contamination;
- changes in the legal requirements we are subject to, or the imposition of new legal requirements, that adversely affect our operations;
- extreme weather and natural disasters;
- disease outbreaks and other public health events and measures that are taken by federal, state, and local governmental authorities in response to such outbreaks and events;
- impact of climate change on our properties or operations;
- legal proceedings or class action lawsuits;
- impact of reputational harm caused by negative press or social media postings of our actions or policies, whether or not warranted;
- compliance costs associated with numerous federal, state and local laws and regulations; and
- other risks identified in this release and in reports we file with the SEC or in other documents that we publicly disseminate.
New factors may also emerge from time to time that could have a material adverse effect on our business. Except as required by law, we undertake no obligation to publicly update or revise forward-looking statements contained in this release to reflect events, circumstances or changes in expectations after the date of this release.
FINANCIAL HIGHLIGHTS | ||||||||||||||||
Dollars in thousands, except per share data | Three months ended September 30, | Nine months ended September 30, | ||||||||||||||
2024 | 2023 | 2024 | 2023 | |||||||||||||
Rental and other property revenues | $ | 551,126 | $ | 542,042 | $ | 1,641,183 | $ | 1,606,221 | ||||||||
Net income available for MAA common shareholders | $ | 114,273 | $ | 109,810 | $ | 358,131 | $ | 389,564 | ||||||||
Total NOI (1) | $ | 339,565 | $ | 342,819 | $ | 1,026,024 | $ | 1,029,862 | ||||||||
Earnings per common share: (2) | ||||||||||||||||
Basic | $ | 0.98 | $ | 0.94 | $ | 3.07 | $ | 3.34 | ||||||||
Diluted | $ | 0.98 | $ | 0.94 | $ | 3.07 | $ | 3.34 | ||||||||
Funds from operations per Share - diluted: (2) | ||||||||||||||||
FFO (1) | $ | 2.10 | $ | 2.16 | $ | 6.57 | $ | 6.85 | ||||||||
Core FFO (1) | $ | 2.21 | $ | 2.29 | $ | 6.65 | $ | 6.85 | ||||||||
Core AFFO (1) | $ | 1.93 | $ | 1.99 | $ | 5.91 | $ | 6.14 | ||||||||
Dividends declared per common share | $ | 1.47 | $ | 1.40 | $ | 4.41 | $ | 4.20 | ||||||||
Dividends/Core FFO (diluted) payout ratio | 66.5 | % | 61.1 | % | 66.3 | % | 61.3 | % | ||||||||
Dividends/Core AFFO (diluted) payout ratio | 76.2 | % | 70.4 | % | 74.6 | % | 68.4 | % | ||||||||
Consolidated interest expense | $ | 42,726 | $ | 36,651 | $ | 124,352 | $ | 110,655 | ||||||||
Mark-to-market debt adjustment | — | — | — | 25 | ||||||||||||
Debt discount and debt issuance cost amortization | (1,514) | (1,501) | (4,569) | (4,562) | ||||||||||||
Capitalized interest | 5,048 | 3,182 | 12,188 | 9,065 | ||||||||||||
Total interest incurred | $ | 46,260 | $ | 38,332 | $ | 131,971 | $ | 115,183 | ||||||||
Amortization of principal on notes payable | $ | — | $ | 124 | $ | — | $ | 854 | ||||||||
(1) | A reconciliation of the following items and discussion of their respective components can be found later in this release: (i) Net income available for MAA common shareholders to NOI; and (ii) Net income available for MAA common shareholders to FFO, Core FFO and Core AFFO. |
(2) | See the "Share and Unit Data" section for additional information. |
Dollars in thousands, except share price | ||||||||
September 30, 2024 | December 31, 2023 | |||||||
Gross Assets (1) | $ | 16,984,512 | $ | 16,349,193 | ||||
Gross Real Estate Assets (1) | $ | 16,733,158 | $ | 16,089,909 | ||||
Total debt | $ | 4,875,968 | $ | 4,540,225 | ||||
Common shares and units outstanding | 119,955,843 | 119,838,096 | ||||||
Share price | $ | 158.90 | $ | 134.46 | ||||
Book equity value | $ | 6,154,112 | $ | 6,299,122 | ||||
Market equity value | $ | 19,060,983 | $ | 16,113,430 | ||||
Net Debt/Adjusted EBITDAre (2) | 3.9x | 3.6x | ||||||
(1) | A reconciliation of Total assets to Gross Assets and Real estate assets, net, to Gross Real Estate Assets, along with discussion of their components, can be found later in this release. |
(2) | Adjusted EBITDAre is calculated for the trailing twelve month period for each date presented. A reconciliation of the following items and discussion of their respective components can be found later in this release: (i) Unsecured notes payable and Secured notes payable to Net Debt; and (ii) Net income to EBITDA, EBITDAre and Adjusted EBITDAre. |
CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||
Dollars in thousands, except per share data (Unaudited) | Three months ended | Nine months ended | ||||||||||||||
2024 | 2023 | 2024 | 2023 | |||||||||||||
Revenues: | ||||||||||||||||
Rental and other property revenues | $ | 551,126 | $ | 542,042 | $ | 1,641,183 | $ | 1,606,221 | ||||||||
Expenses: | ||||||||||||||||
Operating expenses, excluding real estate taxes and insurance | 134,475 | 122,660 | 378,887 | 347,868 | ||||||||||||
Real estate taxes and insurance | 77,086 | 76,563 | 236,272 | 228,491 | ||||||||||||
Depreciation and amortization | 146,722 | 146,702 | 434,764 | 424,175 | ||||||||||||
Total property operating expenses | 358,283 | 345,925 | 1,049,923 | 1,000,534 | ||||||||||||
Property management expenses | 17,265 | 16,298 | 54,461 | 50,317 | ||||||||||||
General and administrative expenses | 12,728 | 13,524 | 42,444 | 43,329 | ||||||||||||
Interest expense | 42,726 | 36,651 | 124,352 | 110,655 | ||||||||||||
Loss on sale of depreciable real estate assets | — | 75 | 25 | 61 | ||||||||||||
Gain on sale of non-depreciable real estate assets | — | — | — | (54) | ||||||||||||
Other non-operating expense (income) | 1,678 | 16,493 | (2,604) | (3,966) | ||||||||||||
Income before income tax (expense) benefit | 118,446 | 113,076 | 372,582 | 405,345 | ||||||||||||
Income tax (expense) benefit | (670) | 209 | (3,485) | (3,596) | ||||||||||||
Income from continuing operations before real estate joint venture activity | 117,776 | 113,285 | 369,097 | 401,749 | ||||||||||||
Income from real estate joint venture | 454 | 447 | 1,405 | 1,214 | ||||||||||||
Net income | 118,230 | 113,732 | 370,502 | 402,963 | ||||||||||||
Net income attributable to noncontrolling interests | 3,035 | 3,000 | 9,605 | 10,633 | ||||||||||||
Net income available for shareholders | 115,195 | 110,732 | 360,897 | 392,330 | ||||||||||||
Dividends to MAA Series I preferred shareholders | 922 | 922 | 2,766 | 2,766 | ||||||||||||
Net income available for MAA common shareholders | $ | 114,273 | $ | 109,810 | $ | 358,131 | $ | 389,564 | ||||||||
Earnings per common share - basic: | ||||||||||||||||
Net income available for common shareholders | $ | 0.98 | $ | 0.94 | $ | 3.07 | $ | 3.34 | ||||||||
Earnings per common share - diluted: | ||||||||||||||||
Net income available for common shareholders | $ | 0.98 | $ | 0.94 | $ | 3.07 | $ | 3.34 | ||||||||
SHARE AND UNIT DATA | ||||||||||||||||
Shares and units in thousands | Three months ended | Nine months ended | ||||||||||||||
2024 | 2023 | 2024 | 2023 | |||||||||||||
Net Income Shares (1) | ||||||||||||||||
Weighted average common shares - basic | 116,820 | 116,633 | 116,758 | 116,479 | ||||||||||||
Effect of dilutive securities | — | 78 | — | 134 | ||||||||||||
Weighted average common shares - diluted | 116,820 | 116,711 | 116,758 | 116,613 | ||||||||||||
Funds From Operations Shares And Units | ||||||||||||||||
Weighted average common shares and units - basic | 119,900 | 119,787 | 119,865 | 119,635 | ||||||||||||
Weighted average common shares and units - diluted | 119,954 | 119,833 | 119,919 | 119,683 | ||||||||||||
Period End Shares And Units | ||||||||||||||||
Common shares at September 30, | 116,880 | 116,687 | 116,880 | 116,687 | ||||||||||||
Operating Partnership units at September 30, | 3,076 | 3,148 | 3,076 | 3,148 | ||||||||||||
Total common shares and units at September 30, | 119,956 | 119,835 | 119,956 | 119,835 | ||||||||||||
(1) | For additional information on the calculation of diluted common shares and earnings per common share, please refer to the Notes to the Condensed Consolidated Financial Statements in MAA's Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2024, expected to be filed with the SEC on or about October 31, 2024. |
CONSOLIDATED BALANCE SHEETS | ||||||||
Dollars in thousands (Unaudited) | ||||||||
September 30, 2024 | December 31, 2023 | |||||||
Assets | ||||||||
Real estate assets: | ||||||||
Land | $ | 2,085,464 | $ | 2,031,403 | ||||
Buildings and improvements and other | 13,956,601 | 13,515,949 | ||||||
Development and capital improvements in progress | 499,619 | 385,405 | ||||||
16,541,684 | 15,932,757 | |||||||
Less: Accumulated depreciation | (5,217,893) | (4,864,690) | ||||||
11,323,791 | 11,068,067 | |||||||
Undeveloped land | 73,861 | 73,861 | ||||||
Investment in real estate joint venture | 41,693 | 41,977 | ||||||
Real estate assets, net | 11,439,345 | 11,183,905 | ||||||
Cash and cash equivalents | 50,232 | 41,314 | ||||||
Restricted cash | 13,829 | 13,777 | ||||||
Other assets | 237,525 | 245,507 | ||||||
Assets held for sale | 15,321 | — | ||||||
Total assets | $ | 11,756,252 | $ | 11,484,503 | ||||
Liabilities and equity | ||||||||
Liabilities: | ||||||||
Unsecured notes payable | $ | 4,515,733 | $ | 4,180,084 | ||||
Secured notes payable | 360,235 | 360,141 | ||||||
Accrued expenses and other liabilities | 726,172 | 645,156 | ||||||
Total liabilities | 5,602,140 | 5,185,381 | ||||||
Redeemable common stock | 22,518 | 19,167 | ||||||
Shareholders' equity: | ||||||||
Preferred stock | 9 | 9 | ||||||
Common stock | 1,166 | 1,168 | ||||||
Additional paid-in capital | 7,413,674 | 7,399,921 | ||||||
Accumulated distributions in excess of net income | (1,458,816) | (1,298,263) | ||||||
Accumulated other comprehensive loss | (7,359) | (8,764) | ||||||
Total MAA shareholders' equity | 5,948,674 | 6,094,071 | ||||||
Noncontrolling interests - Operating Partnership units | 155,562 | 163,128 | ||||||
Total shareholders' equity | 6,104,236 | 6,257,199 | ||||||
Noncontrolling interests - consolidated real estate entities | 27,358 | 22,756 | ||||||
Total equity | 6,131,594 | 6,279,955 | ||||||
Total liabilities and equity | $ | 11,756,252 | $ | 11,484,503 | ||||
RECONCILIATION OF NET INCOME AVAILABLE FOR MAA COMMON SHAREHOLDERS TO FFO, CORE FFO, CORE AFFO AND FAD | ||||||||||||||||
Amounts in thousands, except per share and unit data | Three months ended September 30, | Nine months ended September 30, | ||||||||||||||
2024 | 2023 | 2024 | 2023 | |||||||||||||
Net income available for MAA common shareholders | $ | 114,273 | $ | 109,810 | $ | 358,131 | $ | 389,564 | ||||||||
Depreciation and amortization of real estate assets | 145,256 | 145,278 | 430,470 | 419,532 | ||||||||||||
Loss on sale of depreciable real estate assets | — | 75 | 25 | 61 | ||||||||||||
MAA's share of depreciation and amortization of real estate assets of real estate joint venture | 157 | 153 | 466 | 456 | ||||||||||||
Gain on consolidation of third-party development (1) | (11,033) | — | (11,033) | — | ||||||||||||
Net income attributable to noncontrolling interests | 3,035 | 3,000 | 9,605 | 10,633 | ||||||||||||
FFO attributable to common shareholders and unitholders | 251,688 | 258,316 | 787,664 | 820,246 | ||||||||||||
Loss on embedded derivative in preferred shares (1) | 18,257 | 11,250 | 14,451 | 1,863 | ||||||||||||
Gain on sale of non-depreciable real estate assets | — | — | — | (54) | ||||||||||||
Loss (gain) on investments, net of tax (1)(2) | 533 | 5,166 | (2,873) | (603) | ||||||||||||
Casualty related (recoveries) charges, net (1) | (5,714) | 217 | (9,664) | 588 | ||||||||||||
Gain on debt extinguishment (1) | — | (57) | — | (57) | ||||||||||||
Legal costs, settlements and (recoveries), net (1)(3) | — | — | 8,000 | (1,600) | ||||||||||||
Mark-to-market debt adjustment (4) | — | — | — | (25) | ||||||||||||
Core FFO attributable to common shareholders and unitholders | 264,764 | 274,892 | 797,578 | 820,358 | ||||||||||||
Recurring capital expenditures | (33,535) | (36,368) | (88,810) | (85,367) | ||||||||||||
Core AFFO attributable to common shareholders and unitholders | 231,229 | 238,524 | 708,768 | 734,991 | ||||||||||||
Redevelopment capital expenditures | (12,769) | (19,723) | (33,767) | (77,442) | ||||||||||||
Revenue enhancing capital expenditures | (21,924) | (19,123) | (60,566) | (51,168) | ||||||||||||
Commercial capital expenditures | (1,211) | (2,104) | (4,281) | (4,540) | ||||||||||||
Other capital expenditures | (24,183) | (6,554) | (47,158) | (23,109) | ||||||||||||
FAD attributable to common shareholders and unitholders | $ | 171,142 | $ | 191,020 | $ | 562,996 | $ | 578,732 | ||||||||
Dividends and distributions paid | $ | 176,329 | $ | 167,766 | $ | 528,824 | $ | 501,620 | ||||||||
Weighted average common shares - diluted | 116,820 | 116,711 | 116,758 | 116,613 | ||||||||||||
FFO weighted average common shares and units - diluted | 119,954 | 119,833 | 119,919 | 119,683 | ||||||||||||
Earnings per common share - diluted: | ||||||||||||||||
Net income available for common shareholders | $ | 0.98 | $ | 0.94 | $ | 3.07 | $ | 3.34 | ||||||||
FFO per Share - diluted | $ | 2.10 | $ | 2.16 | $ | 6.57 | $ | 6.85 | ||||||||
Core FFO per Share - diluted | $ | 2.21 | $ | 2.29 | $ | 6.65 | $ | 6.85 | ||||||||
Core AFFO per Share - diluted | $ | 1.93 | $ | 1.99 | $ | 5.91 | $ | 6.14 | ||||||||
(1) | Included in Other non-operating expense (income) in the Consolidated Statements of Operations. |
(2) | For the three months ended September 30, 2024 and 2023, loss on investments is presented net of tax benefit of |
(3) | For the nine months ended September 30, 2024, in accordance with its accounting policies, MAA recognized |
(4) | Included in Interest expense in the Consolidated Statements of Operations. |
RECONCILIATION OF NET INCOME AVAILABLE FOR MAA COMMON SHAREHOLDERS TO NET OPERATING INCOME | ||||||||||||||||||||
Dollars in thousands | Three Months Ended | Nine Months Ended | ||||||||||||||||||
September 30, | June 30, | September 30, | September 30, | September 30, | ||||||||||||||||
Net income available for MAA common shareholders | $ | 114,273 | $ | 101,031 | $ | 109,810 | $ | 358,131 | $ | 389,564 | ||||||||||
Depreciation and amortization | 146,722 | 145,022 | 146,702 | 434,764 | 424,175 | |||||||||||||||
Property management expenses | 17,265 | 17,201 | 16,298 | 54,461 | 50,317 | |||||||||||||||
General and administrative expenses | 12,728 | 12,671 | 13,524 | 42,444 | 43,329 | |||||||||||||||
Interest expense | 42,726 | 41,265 | 36,651 | 124,352 | 110,655 | |||||||||||||||
Loss on sale of depreciable real estate assets | — | 23 | 75 | 25 | 61 | |||||||||||||||
Gain on sale of non-depreciable real estate assets | — | — | — | — | (54) | |||||||||||||||
Other non-operating expense (income) | 1,678 | 19,244 | 16,493 | (2,604) | (3,966) | |||||||||||||||
Income tax expense (benefit) | 670 | 1,020 | (209) | 3,485 | 3,596 | |||||||||||||||
Income from real estate joint venture | (454) | (469) | (447) | (1,405) | (1,214) | |||||||||||||||
Net income attributable to noncontrolling interests | 3,035 | 2,709 | 3,000 | 9,605 | 10,633 | |||||||||||||||
Dividends to MAA Series I preferred shareholders | 922 | 922 | 922 | 2,766 | 2,766 | |||||||||||||||
Total NOI | $ | 339,565 | $ | 340,639 | $ | 342,819 | $ | 1,026,024 | $ | 1,029,862 | ||||||||||
Same Store NOI | $ | 327,267 | $ | 328,280 | $ | 332,973 | $ | 990,130 | $ | 1,001,513 | ||||||||||
Non-Same Store and Other NOI | 12,298 | 12,359 | 9,846 | 35,894 | 28,349 | |||||||||||||||
Total NOI | $ | 339,565 | $ | 340,639 | $ | 342,819 | $ | 1,026,024 | $ | 1,029,862 | ||||||||||
RECONCILIATION OF NET INCOME TO EBITDA, EBITDAre AND ADJUSTED EBITDAre | ||||||||||||||||
Dollars in thousands | Three Months Ended | Twelve Months Ended | ||||||||||||||
September 30, 2024 | September 30, 2023 | September 30, 2024 | December 31, 2023 | |||||||||||||
Net income | $ | 118,230 | $ | 113,732 | $ | 535,370 | $ | 567,831 | ||||||||
Depreciation and amortization | 146,722 | 146,702 | 575,652 | 565,063 | ||||||||||||
Interest expense | 42,726 | 36,651 | 162,931 | 149,234 | ||||||||||||
Income tax expense | 670 | (209) | 4,633 | 4,744 | ||||||||||||
EBITDA | 308,348 | 296,876 | 1,278,586 | 1,286,872 | ||||||||||||
Loss on sale of depreciable real estate assets | — | 75 | 26 | 62 | ||||||||||||
Gain on consolidation of third-party development (1) | (11,033) | — | (11,033) | — | ||||||||||||
Adjustments to reflect MAA's share of EBITDAre of an unconsolidated affiliate | 340 | 340 | 1,356 | 1,350 | ||||||||||||
EBITDAre | 297,655 | 297,291 | 1,268,935 | 1,288,284 | ||||||||||||
Loss (gain) on embedded derivative in preferred shares (1) | 18,257 | 11,250 | (5,940) | (18,528) | ||||||||||||
Gain on sale of non-depreciable real estate assets | — | — | — | (54) | ||||||||||||
Loss (gain) on investments (1) | 648 | 6,547 | (7,369) | (4,449) | ||||||||||||
Casualty related (recoveries) charges, net (1) | (5,714) | 217 | (9,272) | 980 | ||||||||||||
Gain on debt extinguishment (1) | — | (57) | — | (57) | ||||||||||||
Legal costs, settlements and (recoveries), net (1)(2) | — | — | 5,146 | (4,454) | ||||||||||||
Adjusted EBITDAre | $ | 310,846 | $ | 315,248 | $ | 1,251,500 | $ | 1,261,722 | ||||||||
(1) | Included in Other non-operating expense (income) in the Consolidated Statements of Operations. |
(2) | During the twelve months ended September 30, 2024, in accordance with its accounting policies, MAA recognized |
RECONCILIATION OF UNSECURED NOTES PAYABLE AND SECURED NOTES PAYABLE TO NET DEBT | ||||||||
Dollars in thousands | ||||||||
September 30, 2024 | December 31, 2023 | |||||||
Unsecured notes payable | $ | 4,515,733 | $ | 4,180,084 | ||||
Secured notes payable | 360,235 | 360,141 | ||||||
Total debt | 4,875,968 | 4,540,225 | ||||||
Cash and cash equivalents | (50,232) | (41,314) | ||||||
Net Debt | $ | 4,825,736 | $ | 4,498,911 | ||||
RECONCILIATION OF TOTAL ASSETS TO GROSS ASSETS | ||||||||
Dollars in thousands | ||||||||
September 30, 2024 | December 31, 2023 | |||||||
Total assets | $ | 11,756,252 | $ | 11,484,503 | ||||
Accumulated depreciation | 5,217,893 | 4,864,690 | ||||||
Accumulated depreciation for Assets held for sale (1) | 10,367 | — | ||||||
Gross Assets | $ | 16,984,512 | $ | 16,349,193 | ||||
(1) | Included in Assets held for sale in the Consolidated Balance Sheets. |
RECONCILIATION OF REAL ESTATE ASSETS, NET TO GROSS REAL ESTATE ASSETS | ||||||||
Dollars in thousands | ||||||||
September 30, 2024 | December 31, 2023 | |||||||
Real estate assets, net | $ | 11,439,345 | $ | 11,183,905 | ||||
Accumulated depreciation | 5,217,893 | 4,864,690 | ||||||
Assets held for sale, net | 15,321 | — | ||||||
Accumulated depreciation for Assets held for sale (1) | 10,367 | — | ||||||
Cash and cash equivalents | 50,232 | 41,314 | ||||||
Gross Real Estate Assets | $ | 16,733,158 | $ | 16,089,909 | ||||
(1) | Included in Assets held for sale in the Consolidated Balance Sheets. |
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 of MAA's core operations such as adjustments related to the fair value of the embedded derivative in the MAA Series I preferred shares, gain or loss on sale of non-depreciable assets, gain or loss on investments, casualty related charges (recoveries), net, gain or loss on debt extinguishment and legal costs, settlements and (recoveries), net. As an owner and operator of real estate, MAA considers Adjusted EBITDAre to be an important measure of performance from core operations because Adjusted EBITDAre excludes various income and expense items that are not indicative of operating performance. MAA's computation of Adjusted EBITDAre may differ from the methodology utilized by other companies to calculate Adjusted EBITDAre. Adjusted EBITDAre should not be considered as an alternative to Net income as an indicator of operating performance.
Core Adjusted Funds from Operations (Core AFFO)
Core AFFO is composed of Core FFO less recurring capital expenditures. Because net income attributable to noncontrolling interests is added back, Core AFFO, when used in this release, represents Core AFFO attributable to common shareholders and unitholders. Core AFFO should not be considered as an alternative to Net income available for MAA common shareholders as an indicator of operating performance. As an owner and operator of real estate, MAA considers Core AFFO to be an important measure of performance from operations because Core AFFO measures the ability to control revenues, expenses and recurring capital expenditures.
Core Funds from Operations (Core FFO)
Core FFO represents FFO as adjusted for items that are not considered part of MAA's core business operations such as adjustments related to the fair value of the embedded derivative in the MAA Series I preferred shares; gain or loss on sale of non-depreciable assets; gain or loss on investments, net of tax; casualty related charges (recoveries), net; gain or loss on debt extinguishment; legal costs, settlements and (recoveries), net, and mark-to-market debt adjustments. Because net income attributable to noncontrolling interests is added back, Core FFO, when used in this release, represents Core FFO attributable to common shareholders and unitholders. While MAA's definition of Core FFO may be similar to others in the industry, MAA's methodology for calculating Core FFO may differ from that utilized by other REITs and, accordingly, may not be comparable to such other REITs. Core FFO should not be considered as an alternative to Net income available for MAA common shareholders as an indicator of operating performance. MAA believes that Core FFO is helpful in understanding its core operating performance between periods in that it removes certain items that by their nature are not comparable over periods and therefore tend to obscure actual operating performance.
EBITDA
For purposes of calculations in this release, Earnings Before Interest, Income Taxes, Depreciation and Amortization, or EBITDA, is composed of net income plus depreciation and amortization, interest expense, and income taxes. As an owner and operator of real estate, MAA considers EBITDA to be an important measure of performance from core operations because EBITDA excludes various expense items that are not indicative of operating performance. EBITDA should not be considered as an alternative to Net income as an indicator of operating performance.
EBITDAre
For purposes of calculations in this release, Earnings Before Interest, Income Taxes, Depreciation and Amortization for real estate, or EBITDAre, is composed of EBITDA further adjusted for the gain or loss on sale of depreciable assets, gain on consolidation of third-party development and adjustments to reflect MAA's share of EBITDAre of an unconsolidated affiliate. As an owner and operator of real estate, MAA considers EBITDAre to be an important measure of performance from core operations because EBITDAre excludes various expense items that are not indicative of operating performance. While MAA's definition of EBITDAre is in accordance with NAREIT's definition, it may differ from the methodology utilized by other companies to calculate EBITDAre. EBITDAre should not be considered as an alternative to Net income as an indicator of operating performance.
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 by insurance proceeds and corporate related capital expenditures. Because net income attributable to noncontrolling interests is added back, FAD, when used in this release, represents FAD attributable to common shareholders and unitholders. FAD should not be considered as an alternative to Net income available for MAA common shareholders as an indicator of operating performance. As an owner and operator of real estate, MAA considers FAD to be an important measure of performance from core operations because FAD measures the ability to control revenues, expenses and capital expenditures.
Funds From Operations (FFO)
FFO represents net income available for MAA common shareholders (calculated in accordance with GAAP) excluding gain or loss on disposition of operating properties, asset impairment and gain on consolidation of third-party development, plus depreciation and amortization of real estate assets, net income attributable to noncontrolling interests and adjustments for joint ventures. Because net income attributable to noncontrolling interests is added back, FFO, when used in this release, represents FFO attributable to common shareholders and unitholders. While MAA's definition of FFO is in accordance with NAREIT's definition, it may differ from the methodology for calculating FFO utilized by other companies and, accordingly, may not be comparable to such other companies. FFO should not be considered as an alternative to Net income available for MAA common shareholders as an indicator of operating performance. MAA believes that FFO is helpful in understanding operating performance in that FFO excludes depreciation and amortization of real estate assets. MAA believes that GAAP historical cost depreciation of real estate assets is generally not correlated with changes in the value of those assets, whose value does not diminish predictably over time, as historical cost depreciation implies.
Gross Assets
Gross Assets represents Total assets plus Accumulated depreciation and Accumulated depreciation for Assets held for sale. MAA believes that Gross Assets can be used as a helpful tool in evaluating its balance sheet positions. MAA believes that GAAP historical cost depreciation of real estate assets is generally not correlated with changes in the value of those assets, whose value does not diminish predictably over time, as historical cost depreciation implies.
NON-GAAP FINANCIAL MEASURES (Continued)
Gross Real Estate Assets
Gross Real Estate Assets represents Real estate assets, net plus Accumulated depreciation, Assets held for sale, net, Accumulated depreciation for Assets held for sale, Cash and cash equivalents and 1031(b) exchange proceeds included in Restricted cash. MAA believes that Gross Real Estate Assets can be used as a helpful tool in evaluating its balance sheet positions. MAA believes that GAAP historical cost depreciation of real estate assets is generally not correlated with changes in the value of those assets, whose value does not diminish predictably over time, as historical cost depreciation implies.
Net Debt
Net Debt represents Unsecured notes payable and Secured notes payable less Cash and cash equivalents and 1031(b) exchange proceeds included in Restricted cash. MAA believes Net Debt is a helpful tool in evaluating its debt position.
Net Operating Income (NOI)
Net Operating Income represents Rental and other property revenues less Total property operating expenses, excluding depreciation and amortization, for all properties held during the period, regardless of their status as held for sale. NOI should not be considered as an alternative to Net income available for MAA common shareholders. MAA believes NOI is a helpful tool in evaluating operating performance because it measures the core operations of property performance by excluding corporate level expenses and other items not related to property operating performance.
Non-Same Store and Other NOI
Non-Same Store and Other NOI represents Rental and other property revenues less Total property operating expenses, excluding depreciation and amortization, for all properties classified within the Non-Same Store and Other Portfolio during the period. Non-Same Store and Other NOI includes storm-related expenses related to severe weather events, including hurricanes and winter storms. Non-Same Store and Other NOI should not be considered as an alternative to Net income available for MAA common shareholders. MAA believes Non-Same Store and Other NOI is a helpful tool in evaluating operating performance because it measures the core operations of property performance by excluding corporate level expenses and other items not related to property operating performance.
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. Same Store NOI excludes storm-related expenses related to severe weather events, including hurricanes and winter storms. Same Store NOI should not be considered as an alternative to Net income available for MAA common shareholders. MAA believes Same Store NOI is a helpful tool in evaluating operating performance because it measures the core operations of property performance by excluding corporate level expenses and other items not related to property operating performance.
OTHER KEY DEFINITIONS
Average Effective Rent per Unit
Average Effective Rent per Unit represents the average of gross rent amounts after the effect of leasing concessions for occupied units plus prevalent market rates asked for unoccupied units, divided by the total number of units. Leasing concessions represent discounts to the current market rate. MAA believes average effective rent is a helpful measurement in evaluating average pricing. It does not represent actual rental revenue collected per unit.
Average Physical Occupancy
Average Physical Occupancy represents the average of the daily physical occupancy for an applicable period.
Development Communities
Communities remain identified as development until certificates of occupancy are obtained for all units under development. Once all units are delivered and available for occupancy, the community moves into the Lease-up Communities portfolio.
Lease-up Communities
New acquisitions acquired during lease-up and newly developed communities remain in the Lease-up Communities portfolio until stabilized. Communities are considered stabilized when achieving
Non-Same Store and Other Portfolio
Non-Same Store and Other Portfolio includes recently acquired communities, communities in development or lease-up, communities that have been disposed of or identified for disposition, communities that have experienced a significant casualty loss, stabilized communities that do not meet the requirements defined by the Same Store Portfolio, retail properties and commercial properties.
Resident Turnover
Resident turnover represents resident move outs excluding transfers within the Same Store Portfolio as a percentage of expiring leases on a trailing twelve month basis as of the end of the reported quarter.
Same Store Portfolio
MAA reviews its Same Store Portfolio at the beginning of each calendar year, or as significant transactions or events warrant. Communities are generally added into the Same Store Portfolio if they were owned and stabilized at the beginning of the previous year. Communities are considered stabilized when achieving
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SOURCE MAA
FAQ
What was MAA's earnings per share for Q3 2024?
What was MAA's Same Store Portfolio occupancy rate in Q3 2024?
How did MAA's Same Store Portfolio NOI perform in Q3 2024?
What acquisitions did MAA complete in Q3 2024?
