Consolidation and Basis of Presentation and Significant Accounting Policies Consolidation and Basis of Presentation and Significant Accounting Policies (Notes)

6 Months Ended

Jun. 30, 2012

Consolidation and Basis of Presentation and Significant Accounting Policies [Abstract]

Consolidation and Basis of Presentation and Significant Accounting Policies

Consolidation and Basis of Presentation and Significant Accounting Policies

Consolidation and Basis of Presentation

Mid-America Apartment Communities, Inc., or we, or MAA, is a self-administered real estate investment trust, or REIT, that owns, acquires, renovates, develops and manages apartment communities in the Sunbelt region of the United States. As of June 30, 2012, we owned or owned interests in a total of 168 multifamily apartment communities comprising 49,002 apartments located in 13 states, including two communities comprising 626 apartments owned through our joint venture, Mid-America Multifamily Fund I, LLC, and four communities comprising 1,156 apartments owned through our joint venture, Mid-America Multifamily Fund II, LLC. In addition, we also had three development communities and a second phase to an existing community under construction totaling 1,220 units as of June 30, 2012. A total of 405 units for the development projects were completed as of June 30, 2012, and therefore have been included in the totals above. Total expected costs for the development projects are $143.6 million, of which $97.1 million has been incurred to date. We expect to complete construction on three of the projects by the fourth quarter 2012, with the last project being completed by the fourth quarter 2013. Four of our properties include retail components with approximately 104,000 square feet of gross leasable area.

The accompanying unaudited condensed consolidated financial statements have been prepared by our management in accordance with United States generally accepted accounting principles, or GAAP, for interim financial information and applicable rules and regulations of the Securities and Exchange Commission, or the SEC, and our accounting policies as set forth in our December 31, 2011 annual consolidated financial statements. The accompanying unaudited condensed consolidated financial statements include our accounts and those of our subsidiaries, including Mid-America Apartments, L.P.  In our opinion, all adjustments necessary for a fair presentation of the condensed consolidated financial statements have been included and all such adjustments were of a normal recurring nature except for an approximately $655,000 out of period adjustment related to the capitalization of land acquisition costs recorded during the first quarter of 2012. All significant intercompany accounts and transactions have been eliminated in consolidation. The results of operations for the three and six month periods ended June 30, 2012 are not necessarily indicative of the results to be expected for the full year. These financial statements should be read in conjunction with our audited financial statements and notes thereto included in our Annual Report on Form 10-K filed with the SEC on February 24, 2012.

The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities at the dates of the financial statements and the amounts of revenues and expenses during the reporting periods.  Actual amounts realized or paid could differ from those estimates.

Earnings per Common Share

Basic earnings per share is computed by dividing net income attributable to common shareholders by the weighted average number of shares outstanding during the period.  All outstanding unvested restricted share awards contain rights to non-forfeitable dividends and participate in undistributed earnings with common shareholders and, accordingly, are considered participating securities that are included in the two class method of computing basic earnings per share. Both the unvested restricted shares and other potentially dilutive common shares, and the related impact to earnings, are considered when calculating earnings per share on a diluted basis with our diluted earnings per share being the more dilutive of the treasury stock or two class methods.  Operating partnership units are included in dilutive earnings per share calculations when they are dilutive to earnings per share. For the three and six month periods ended June 30, 2012 and 2011, our basic earnings per share is computed using the two class method and our diluted earnings per share is computed using the more dilutive of the treasury stock method or two class method as follows:

(dollars and shares in thousands, except per share amounts)	Three months ended June 30,							Six months ended June 30,
	2012				2011			2012					2011
Shares Outstanding
Weighted average common shares - basic	40,983				36,836			40,243					36,274
Weighted average partnership units outstanding	—			(1)	1,982			—			(1)		2,041
Effect of dilutive securities	45				105			84					105
Weighted average common shares - diluted	41,028				38,923			40,327					38,420
Calculation of Earnings per Share - basic
Net income available for common shareholders	$	28,160			$	7,428		$	52,050				$	16,272
Net income allocated to unvested restricted shares	(25		)		(2		)	(54		)			(11		)
Net income available for common shareholders, adjusted	$	28,135			$	7,426		$	51,996				$	16,261
Weighted average common shares - basic	40,983				36,836			40,243					36,274
Earnings per share - basic	$	0.69			$	0.20		$	1.29				$	0.45
Calculation of Earnings per Share - diluted
Net income available for common shareholders	$	28,160			$	7,428		$	52,050				$	16,272
Net income attributable to noncontrolling interests	—			(1)	252			—			(1	)	563
Adjusted net income available for common shareholders	$	28,160			$	7,680		$	52,050				$	16,835
Weighted average common shares - diluted	41,028				38,923			40,327					38,420
Earnings per share - diluted	$	0.69			$	0.20		$	1.29				$	0.44

⁽¹⁾ Operating partnership units are not included in dilutive earnings per share calculations for the three or six months ended June 30, 2012, as they were not dilutive.