EX-99 2 ex-99.htm EXHIBIT 99 Exhibit 99
Investor Update
February 2007
 
 
 
Focused, Experienced, Successful
•
IPO January 1994
–
Exclusively multifamily
–
Strong public company platform
–
$3 billion total capitalization
•
High quality portfolio
–
40,293 units
–
138 communities
–
13 states
•
Experienced management
–
Disciplined investment
–
Conservative strategy
–
Aggressive operations
•
Solid returns to shareholders
–
3-year return, 25.5% annual
–
Since IPO, 17.7% annual
 
 
 
Sunbelt region focus…high growth markets...more stable demand side performance
Three tier market strategy…diversified performance and investment profile…drives
superior risk adjusted performance through full market and economic cycles
Extensive network and deal flow…disciplined investment hurdle protocols…
realistic underwriting…solid record of disciplined capital deployment
High quality apartment real estate…desirable apartment housing catering to
largest rental market segment…more stable demand and performance
Strong and experienced operating platform…competitive regional advantages in
asset management and property management operations…focus on efficiency
Disciplined model for creating value with a proven record of stable performance
Disciplined Strategy for Creating Value
 
 
 
MAA’s investment region
is expected to capture
higher demand for
multifamily housing as
compared to other
regions of the U.S.
MAA’s three-tier market
strategy drives lower
volatility and higher risk
adjusted performance results
Focus on High Growth Region
 
 
 
Mid Tier
Markets
37.5%
Jacksonville, FL
Austin, TX
Nashville, TN
and Others
Large Tier
Markets
31.9%
Dallas, TX
Atlanta, GA
Tampa, FL
and Others
Small Tier
Markets
30.6%
Savannah, GA
Charleston, SC
Lakeland, FL
and Others
Three-Tier Market Strategy
•
Captures broad benefits of
high growth region…with
lower volatility
•
Sophisticated operating
platform provides competitive
advantages in many markets
throughout the region
•
Balance sheet and strong due
diligence team provides
ability to execute an attractive
“close” program…competitive
advantage in many markets
•
More recession resistant
performance…lower volatility
 
 
 
Competitive Edge – Deal Flow
•
Long-term regional focus
–
Extensive broker network
–
Owner relationships
•
Efficient due diligence
–
In-depth market knowledge
–
Highly efficient and thorough
capital assessment program
•
Stronger balance sheet
–
Fewer contingencies
–
Can handle existing debt
•
Developer attraction
–
Multiple phase developments
–
Off market opportunities
 
 
 
MRI
Web Portal
Lease
Revenue
Optimizer
Collections
Management
Resident
Screening
Utilities
Management
Unit Interior
Renovation
Lease
Expiration
Mgmt
On-line
Resident
Solutions
Rent and Fee
Management
Unit Turn
Management
Collection Agency
Integration; real-time
Delinquency reporting
Integrated credit scoring
and background screening;
real-time processing
Utility billing company
integration; vacant
utility real-time cut-off
Detailed tracking of
improvements by unit;
real time price monitoring
Automated guidance for
optimum monthly, weekly
and daily scheduling
On-line leasing, internet
response center, payment
processing, work orders
Yield management;
automated bill-up of fees
and charges
Automated tracking and
monitoring of move-out,
get ready, show and move-in
Training and
Procedures
24/7 training availability;
high degree of control;
on-line procedures
Competitive Edge - Operations
•
Innovative Solutions for
Key Processes
–
Marketing and leasing
–
Payment processing
–
Utility billing integration
–
Vacant utility integration
–
Pricing protocol
–
Lease expiration mgmt
–
Unit turn management
–
Operating expense efficiency
•
Cutting Edge
Technologies
–
Web based property mgmt
–
Yield management platform
–
Web based credit check
–
Web based criminal check
–
Web based leasing
–
Web based payment
process
 
 
 
•
Struggling lease-up (70%
occupied)
•
MAA advantage
–
Ability to carry asset till
stabilized
–
Marketing expertise
–
Extensive market knowledge
–
Re-staffed property
–
Up-graded on site systems
•
Stabilized property in 9 months
Year Acquired:
2003
Gross Investment:
$40.9M
Units:
501
Current Market Value (6% Cap Rate):
$62.0M
Purchase Price:
$40.5M
Value Created:
$21.1M
Capex-to-Date:
$.4M
Leveraged Return (Cash on Cash
IRR):
38%
Lighthouse Court, Jacksonville
Creating Value: Case Study 1
 
 
 
Year Acquired:
1995
  
Gross Investment:
$12.4M
Units:
400
  
Current Market Value (6.5% Cap Rate):
$31.4M
Purchase Price:
$9.3M
  
Value Created:
$19.0M
CapEx-to-Date:
$3.1M
  
Leveraged Return (Cash on Cash
IRR):
33%
         
•
Underperforming and undercapitalized
property in desirable sub-market
•
Difficult resident profile
•
MAA advantage
–
Repositioning expertise
–
Capital improvement expertise
–
Repositioned resident profile
–
Marketing expertise
–
Repositioned property reputation
–
Financing expertise (tax-free bonds)
St. Augustine, Jacksonville
Creating Value: Case Study 2
 
 
 
FFO/Share
Dividend/Share
A focus on high growth
region and a unique
three-tier portfolio
strategy
Disciplined investment
practices and capital
deployment
High quality of
earnings 
Strong asset management
and property management
platforms
Combine to create more stable performance through down cycles,
strong base for performance through up cycles and
higher risk adjusted performance returns through full cycles
Strong and Dependable Results
 
 
 
Solid Internal Growth Prospects
•
Well positioned in high growth region
–
MAA now positioned in seven of the top ten
national markets for job growth and new
household formation over next 10 years
–
Austin, Phoenix, Orlando, Jacksonville,
Tampa, Dallas, Atlanta
–
Muted new supply pressures should
continue for some time
–
Concrete, masonry, doors/windows,
finishes, mechanical, electrical…up an
average of 69.6% from 3/02 – 1/07
–
Minimal exposure to condo reversion
–
Single-family pricing has remained stable
•
New yield management pricing platform
expected to drive “out-performance” revenue
growth results
•
Redevelopment initiative across the portfolio will
continue to drive “out performance” rental
increases
•
New web based technology interfaces and
support systems are generating new revenue
and cost efficiency opportunities
 
 
 
Growth Upside - Interior Upgrade
Brentwood Downs
Nashville, TN
49 Units Completed
14% rent increase
Runaway Bay
Charleston, SC
138 Units Completed
36% rent increase
 
 
 
Improving Growth Prospects
•
Acquisition market remains competitive
•
However, broader market focus and expanded
product focus will widen field of opportunity
•
FL market opportunities increasing
•
New value-add development will begin to
make a growing impact in late ’07 – ’08
•
JV initiative will also expand growth
opportunities
 
 
 
Three new “value add” new development projects currently
underway. At stabilization new units are projected to deliver
± 7.5% NOI yields and contribute $1.3M FFO
Brier Creek Phase II
Raleigh, NC
200 Units
Construction underway
Initial occupancy 2Q07
Projected stabilization
2Q08
St. Augustine at the Lake II
Jacksonville, FL
124 Units
Construction start 2Q07
Initial occupancy 4Q07
Projected stabilization
3Q08
Copper Ridge
Dallas, TX
216 Units
Construction start 2Q07
Initial occupancy 1Q08
Projected stabilization
1Q09
New “Value Add” Development
 
 
 
Strong Joint Venture Platform
•
Experienced with JV programs
–
Blackstone ’98 – ’01
–
Crow Holdings ’01 – ’04
–
Crow Holdings ’04 – ’06
•
Average IRR’s captured for MAA
range 30% - 38%
•
Opportunity to further “monetize”
  and leverage value of deal flow,
asset management and property
management platforms
•
Value add redevelopment program
opportunity
 
 
 
Mid-America’s balance sheet has significantly improved over the last few years.
Coverage ratios and capacity are more in line with sector averages;
especially when considering lower risk investment and growth strategy.
Solid Balance Sheet Position
•
Leverage (debt + preferred as a %
of gross assets) has been
materially reduced over the last 2
years
•
Added $130MM of debt capacity in
2006 (total $219MM current
capacity)
•
Agency credit facilities provide cost
efficient and flexible debt financing
•
Leverage and coverage ratios now
make investment grade corporate
debt program a viable option
 
 
 
FFO/share
$3.40 - $3.60
AFFO/share
$2.77 - $2.97
Guidance for 2007
•
Same store NOI 5% - 6%
•
$28MM new development
•
$6MM redevelopment
•
$150MM core acquisitions
•
$150MM JV acquisitions
•
Long-term value/current year
“headwind”
–
Transition to net pricing ($.02 –
$.04)
–
Series F Preferred refi ($.02)
–
Lease up, new development ($.09)
–
Asset sales ($.02)
•
Recurring CapEx $.63/share
 
 
 
MAA’s projected AFFO growth
compares favorably to sector…
MAA’s AFFO payout ratio in line
with the sector…
MAA’s balance sheet capacity and
strength is in line with sector…
2007E AFFO Growth*
2006E AFFO Payout*
Debt/Total Entity Value*
Especially when considering development
funding obligations and risks…
CIP/Total Entity Value*
*Morgan Stanley, Weekly Statistical Supplement, January 26, 2007
Sector Comparisons
 
 
 
AFFO Multiples 2007E*
MAA priced at sector average AFFO Multiple is $73/share
*Morgan Stanley, Weekly Statistical Supplement, January 26, 2007   **Current implied cap rates are Morgan Stanley estimates…inverted the
sign for the current and long run premium (discount) so that a positive number represents more expensive (Weekly Stat Summary, January 26,
2007)
However, MAA still provides an attractive
price/FFO option within the sector
MS Weekly
Stat Supp
Current
Prm.
(Dsc.)
Long Run
Prm./(Dsc.)
AIV
6.6%
-19.2%
-8.6%
ASN
4.7%
14.9%
3.5%
AVB
4.4%
20.7%
0.9%
BRE
4.9%
11.1%
11.7%
CPT
5.8%
-4.0%
-4.8%
EQR
5.1%
7.8%
0.1%
ESS
5.2%
7.3%
6.6%
HME
6.1%
-10.3%
-5.9%
MAA
6.9%
-24.3%
-11.2%
PPS
6.2%
-11.5%
-4.5%
UDR
5.9%
-6.0%
-1.9%
Avg
5.4%
0.6%
1.5%
And is currently providing a discount
to long-term pricing comparison
Implied Cap Rate**
Sector Comparisons
 
 
 
Investment Summary
•
Focus on high growth region
•
Proven investment disciplines
•
High quality earnings
•
Competitive edge in deal flow
•
Redevelopment upside
•
Value add new development
•
Innovative asset management
•
Aggressive property management
•
Proven JV platform & opportunity
•
Strengthened balance sheet
•
Positioned for strong performance
•
MAA is a proven performer
•
Current attractive pricing
opportunity
 
 
 
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 actual results
to differ materially from those currently anticipated, due to a number of factors, which
include, but are not limited to, unfavorable changes in the apartment market, changing
economic conditions, the impact of competition, acquisitions which may not achieve anticipated
results and other risk factors discussed in documents filed with the Securities and Exchange Commission
from time to time including the Company’s Annual Report on Form 10-K and the Company’s
Quarterly Report on Form 10-Q.  The statements in this presentation are made based
upon information currently known to management and the company assumes no obligation to update or
revise any of its forward-looking statements.
Safe Harbor Disclosure
 
 
 
End of Presentation