BORROWINGS

The weighted average interest rate at December 31, 2015 for the $3.43 billion of debt outstanding was 3.7%, compared to the weighted average interest rate of 3.7% on $3.51 billion of debt outstanding at December 31, 2014. Our debt consists of an unsecured credit facility, unsecured term loans, senior unsecured notes, a secured credit facility with Fannie Mae, and secured property mortgages. We utilize fixed rate borrowings, interest rate swaps, and interest rate caps to manage our current and future interest rate risk. More details on our borrowings can be found in the schedules presented later in this section.

At December 31, 2015, the Company had $65.0 million (after considering the impact of interest rate swap and cap agreements in effect) of conventional, secured variable rate debt outstanding at an average interest rate of 0.8%, $125.0 million of capped conventional, secured variable rate debt at an average interest rate of 0.8%. The interest rate on all other secured debt, totaling $1.1 billion, was hedged or fixed at an average interest rate of 4.0%. Additionally, the Company had $2.1 billion of senior unsecured notes and term loans fixed at an average interest rate of 3.9% and a $750 million variable rate credit facility with an average interest rate of 1.2% with $75 million borrowed at December 31, 2015.

Unsecured Credit Facility

We also maintain a $750.0 million unsecured credit facility with fourteen banks led by KeyBank National Association, or the KeyBank Facility. The KeyBank Facility includes an expansion option up to $1.5 billion. The KeyBank Facility bears an interest rate of LIBOR plus a spread of 0.85% to 1.55% based on an investment grade pricing grid and is currently bearing interest at 1.23%. This credit line expires in April 2020 with an option to extend for an additional six months. At December 31, 2015, we had $746.7 million available to be borrowed under the Key Bank Line agreement with $75.0 million actually borrowed under this facility. Approximately $3.3 million of the facility is used to support letters of credit. Commitment fees related to this facility totaled $1.1 million for the year ended December 31, 2015.

Unsecured Term Loans

We also maintain three term loans with a syndicate of banks, led by KeyBank, Wells Fargo, and US Bank, respectively. The KeyBank term loan has a balance of $150 million, matures in 2021, and has a variable interest rate of LIBOR plus a spread of 0.90% to 1.75% based on our credit ratings. The Wells Fargo term loan has a balance of $250 million and matures in 2018. The US Bank term loan has a balance of $150 million and matures in 2020. Both the Wells Fargo and US Bank term loans have variable interest rates of LIBOR plus a spread of 0.90% to 1.90% based on our credit ratings.

Senior Unsecured Notes

As of December 31, 2015, we had approximately $1.2 billion of publicly issued bonds and $310.0 million of private placement notes. These senior unsecured notes are longer term in nature and usually mature within five to twelve years.

On November 2, 2015, the Operating Partnership issued $400 million in aggregate principal amount of notes, maturing on November 15, 2025 with an interest rate of 4.00% per annum, or the 2025 Notes. The purchase price paid by the initial purchasers was 98.99% of the principal amount. The 2025 Notes are general unsecured senior obligations of the Operating Partnership and rank equally in right of payment with all other senior unsecured indebtedness of the Operating Partnership. Interest on the 2025 Notes is payable on May 15 and November 15 of each year, beginning on May 15, 2016. The net proceeds from the offering after deducting the original issue discount of approximately $4.0 million and underwriting commissions and expenses of approximately $2.6 million were approximately $393.4 million. The 2025 Notes have been reflected net of discount and debt issuance costs in the Consolidated Balance Sheet. In connection with the bond transaction, we cash settled $200 million in forward interest rate swap agreements, entered earlier in the year to effectively lock the interest rate on the planned transaction, which produced an effective interest rate of 4.17% over the ten year life of the bonds.

The Indentures under which certain public notes were issued, including the 2025 Notes, contain certain covenants that, among other things, limit the ability of MAALP and its subsidiaries to incur secured and unsecured indebtedness if not in pro forma compliance with the following negative covenants: (1) total leverage not to exceed 60% of adjusted total assets; (2) secured leverage not to exceed 40% of adjusted total assets; and (3) a fixed charge coverage ratio of at least 1.50 to 1. In addition, MAALP is required to maintain at all times unencumbered consolidated total assets of not less than 150% of the aggregate principal amount of its outstanding unsecured debt. At December 31, 2015, MAALP was in compliance with each of these financial covenants.

Secured Credit Facility

We maintain a $240.0 million secured credit facility with Prudential Mortgage Capital, which is credit enhanced by Fannie Mae, or Fannie Mae Facility. The Fannie Mae Facility provides for both fixed and variable rate borrowings and have Fannie Mae rate tranches with maturities from 2016 through 2018. The interest rate on the majority of the variable portion renews every 90 days and is based on the FNMA discount mortgage backed security rate on the date of renewal, which, for the Company, has historically approximated three-month LIBOR less an average of 0.17% over the life of the Fannie Mae Facility, plus a fee of 0.62%. Borrowings under the Fannie Mae Facility totaled $240.0 million at December 31, 2015, consisting of $50.0 million under a fixed portion at a rate of 4.7%, and the remaining $190.0 million under the variable rate portion of the facility at an average rate of 0.8%. The available borrowing capacity at December 31, 2015, was $240.0 million. Commitment fees related to our unused Fannie Mae Facility totaled $0.1 million for the year ended December 31, 2015. The Company has also entered into 5 interest rate caps totaling a notional amount of $125.0 million which are designed to cap a portion of the Fannie Mae Facility. These interest rate caps have maturities between 2016 and 2018 with four set at 4.5% and one set at 5.0%. The Fannie Mae Facility is subject to certain borrowing base calculations that can effectively reduce the amount that may be borrowed.

Secured Property Mortgages

At December 31, 2015, the Company had $1.0 billion of fixed rate conventional property mortgages with an average interest rate of 3.9% and an average maturity in 2019.

On January 30, 2015, we paid off a $15.2 million mortgage associated with the Farmington Village apartment community. We recorded a $0.2 million loss on debt extinguishment due to paying off the mortgage prior to maturity.

On June 1, 2015, we paid off a $25.5 million mortgage associated with the Colonial Grand at Wilmington apartment community. The payoff was a scheduled maturity of the loan.

On June 15, 2015, we paid off a $10.1 million mortgage associated with the Reserve at Woodwind Lakes apartment community. The payoff was a scheduled maturity of the loan.

On September 1, 2015, we paid off a $11.6 million mortgage associated with the Colonial Village at Timber Crest apartment community. The payoff was a scheduled maturity of the loan.

On September 30, 2015, we paid off a $23.5 million mortgage associated with the Sanctuary at Oglethorpe apartment community. The payoff was a scheduled maturity of the loan.

In addition to these payoffs, we have paid $8.2 million associated with property mortgage principal amortizations for the year ended December 31, 2015.

Guarantees

MAA fully and unconditionally guarantees the following debt incurred by the Operating Partnership:


•	$240.0 million of the Fannie Mae Facility, of which $240.0 million has been borrowed as of December 31, 2015; and


•	$310.0 million of senior unsecured notes, all of which has been borrowed as of December 31, 2015.

Total Outstanding Debt

The following table summarizes the Company’s indebtedness at December 31, 2015, (dollars in thousands):



	Borrowed Balance			Effective Rate		Contract Maturity
Fixed Rate Secured Debt
Individual property mortgages	$	1,012,862		3.9	%	7/12/2019
Fannie Mae conventional credit facilities	50,000			4.7	%	3/31/2017
Total fixed rate secured debt	1,062,862			3.9	%	6/2/2019

Variable Rate Secured Debt ⁽¹⁾
Fannie Mae conventional credit facilities	190,000			0.8	%	8/26/2017
Total variable rate secured debt	190,000			0.8	%	8/26/2017

Fair market value adjustments and debt issuance costs	33,374					3/13/2019
Total Secured Debt	$	1,286,236		3.5	%	2/25/2019

Unsecured Debt
Variable rate credit facility	75,000			1.2	%	4/15/2020
Term loan fixed with swaps	550,000			3.1	%	11/10/2017
Fixed rate bonds	1,535,246			4.2	%	9/16/2023
Fair market value adjustments, debt issuance costs and discounts	(18,914		)			7/2/2025
Total Unsecured Debt	$	2,141,332		3.8	%	1/26/2022

Total Outstanding Debt	$	3,427,568		3.7	%	12/22/2020

⁽¹⁾ Includes capped balances

The following table summarizes interest rate ranges, maturity and balance of our indebtedness, net of fair market value adjustments, debt issuance costs and discounts, at December 31, 2015 and the balance of our indebtedness, net of fair market value adjustments, debt issuance costs and discounts, at December 31, 2014 (dollars in millions):



	At December 31, 2015
	Actual Interest Rates	Current Average Interest Rate	Maturity	Balance		Balance at December 31, 2014
Fixed Rate:
Secured	1.77 - 6.21%	3.97%	2016-2025	$	1,062.9	$	1,129.5
Unsecured	3.15 - 6.05%	4.21%	2016-2025	1,535.2		1,320.2
Interest rate swaps	2.45 - 6.63%	4.19%	2017-2018	550.0		625.0
				$	3,148.1	$	3,074.7
Variable Rate: ⁽¹⁾
Secured	0.80%	0.82%	2017	65.0		83.5
Secured interest rate caps	0.80%	0.82%	2017	125.0		255.4
Unsecured	1.23%	1.23%	2020	75.0		59.0
				$	265.0	$	397.9

Fair market value adjustments, debt issuance costs and discounts				$	14.5	$	40.1
				$	3,427.6	$	3,512.7

⁽¹⁾ Amounts are adjusted to reflect interest rate swap and cap agreements in effect at December 31, 2015, and 2014, respectively, which results in the Company paying fixed interest payments over the terms of the interest rate swaps and on changes in interest rates above the strike rate of the cap. Rates and maturities for capped balances are for the underlying debt, unless the strike rate has been reached.

The following table includes scheduled principal repayments on the borrowings at December 31, 2015, as well as the amortization of the fair market value of debt assumed along with debt discounts and issuance costs (dollars in thousands):



Year	Amortization			Maturities		Total
2016	$	18,989		$	188,824	$	207,813
2017	17,157			156,170		173,327
2018	14,663			465,429		480,092
2019	7,044			539,474		546,518
2020	3,361			377,456		380,817
Thereafter	(1,004		)	1,640,005		1,639,001
	$	60,210		$	3,367,358	$	3,427,568