Mid-America Apartment Communities (MAA) investor relations material

Market trends and demand outlook

• Sunbelt and southwestern markets continue to see robust demand, with absorption at 25-year highs and occupancies stabilizing near pre-COVID levels.

• New supply peaked last year but is now declining rapidly, with fourth-quarter deliveries down over 50% from the third quarter and a 30–40% supply drop expected in 2025.

• Migration and population growth remain strong, with net migration at 7% and single-family home affordability worsening, supporting high retention rates.

• Renewal rates and new lease rates are both higher than last year, despite pressure in high-supply markets like Austin, Phoenix, Nashville, and Jacksonville.

• No signs of financial stress among residents; rent-to-income ratios have improved, and collections remain strong.

Strategic initiatives and portfolio management

• Focus remains on customer service and renewals, with 60% resident retention and top Google scores in the sector.

• Repositioning and redevelopment initiatives are supported by new supply, with renovated units priced below new supply and about 6,000 units targeted for upgrades this year.

• Opportunistic acquisitions are planned as new supply stabilizes and developers face challenges, leveraging balance sheet strength.

• Development pipeline has grown to nearly $1 billion, with new projects expected to deliver mid-6% stabilized yields as supply tightens in 2026–2028.

• Balance sheet remains strong with low leverage (4x), and future growth will be funded through debt.

Regional and segment performance

• Northern Virginia, Charleston, Savannah, Richmond, and Greenville are outperforming, showing resilience to high supply.

• Atlanta, Dallas, and Tampa are recovering, moving toward portfolio averages, while Austin, Nashville, Phoenix, and Jacksonville lag due to supply pressures.

• Suburban assets outperform urban by about 50 basis points in pricing and occupancy; A and B assets show minimal difference.