Segment Information

12 Months Ended

Dec. 31, 2016

Notes To Financial Statements [Abstract]

SEGMENT INFORMATION

SEGMENT INFORMATION

As of December 31, 2016, we owned or had an ownership interest in 303 multifamily apartment communities in 16 different states and the District of Columbia from which we derived all significant sources of earnings and operating cash flows. Senior management evaluates performance and determines resource allocations of each of our apartment communities on a Large Market Same Store, Secondary Market Same Store, and Non-Same Store and Other basis, as well as an individual apartment community basis.  This is consistent with the aggregation criteria under GAAP as each of our apartment communities generally has similar economic characteristics, facilities, services, and tenants. The following are the three reportable operating segments for MAA and the Operating Partnership:

• Large market same store communities are generally communities in markets with a population of at least 1 million and at least 1% of the total public multifamily REIT units that we have owned and have been stabilized for at least a full 12 months.

• Secondary market same store communities are generally communities in markets with populations of more than 1 million but less than 1% of the total public multifamily REIT units or markets with populations of less than 1 million that we have owned and have been stabilized for at least a full 12 months.

• Non same store communities and other includes recent acquisitions, communities in development or lease-up, communities that have been identified for disposition, and communities that have undergone a significant casualty loss. Also included in non same store communities are non multifamily activities which represent less than 1% of our portfolio's net operating income, or NOI.

On the first day of each calendar year, we determine the composition of our same store operating segments for that year as well as adjusting the previous year, which allows us to evaluate full period-over-period operating comparisons. Properties in development or lease-up will be added to the same store portfolio on the first day of the calendar year after they have been owned and stabilized for at least a full 12 months. Communities are considered stabilized after achieving 90% occupancy for 90 days. Communities that have been identified for disposition are excluded from our same store portfolio.

We utilize NOI in evaluating the performance of the segments.  Total NOI represents total 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. We believe NOI is a helpful tool in evaluating the operating performance of our segments because it measures the core operations of property performance by excluding corporate level expenses and other items not related to property operating performance.

A redevelopment community is a community with a specific plan in place to upgrade at least half of the community's units over a period of time with new finishes, fixtures, and appliances, among other upgrades.  These plans include spending a pre-defined amount of capital per unit to achieve a rent increase as a result of the upgrades.  We separately identify redevelopment communities that would cause a material distortion of normal same store operating results. Routine renovations occur at a property as items need to be replaced as a normal part of operations and is done with an expectation to maintain the current level of quality at the property. There is no specified plan in place for routine renovations.

Revenues and NOI for each reportable segment for the years ended December 31, 2016, 2015 and 2014 were as follows (dollars in thousands):

	2016			2015			2014 (1)
Revenues:
Large Market Same Store	$	642,679		$	612,934		$	553,038
Secondary Market Same Store	337,883			327,700			310,281
Non-Same Store and Other	144,786			102,145			128,859
Total property revenues	1,125,348			1,042,779			992,178
Management fee income	—			—			154
Total operating revenues	$	1,125,348		$	1,042,779		$	992,332
NOI:
Large Market Same Store	$	399,287		$	377,025		$	334,255
Secondary Market Same Store	212,053			204,382			190,348
Non-Same Store and Other	90,652			60,727			74,211
Total NOI	701,992			642,134			598,814
Discontinued operations NOI included above	—			—			16
Management fee income	—			—			154
Depreciation and amortization	(322,958		)	(294,520		)	(301,812		)
Acquisition expenses	(2,928		)	(2,777		)	(2,388		)
Property management expenses	(34,093		)	(30,990		)	(32,095		)
General and administrative expenses	(29,040		)	(25,716		)	(20,909		)
Merger related expenses	(39,033		)	—			(3,152		)
Integration related costs	(1,790		)	—			(8,395		)
Interest and other non-property income (expense)	724			(368		)	770
Interest expense	(129,947		)	(122,344		)	(123,953		)
Loss on debt extinguishment/modification	(83		)	(3,602		)	(2,586		)
Net casualty gain (loss) after insurance and other settlement proceeds	448			473			(476		)
Gain on sale of depreciable real estate assets	80,397			189,958			42,649
Income tax expense	(1,699		)	(1,673		)	(2,050		)
Gain on sale of non-depreciable real estate assets	2,171			172			350
Gain (loss) from real estate joint ventures	241			(2		)	6,009
Discontinued operations	—			—			5,331
Net income attributable to noncontrolling interests	(12,180		)	(18,458		)	(8,297		)
Preferred dividends	(307		)	—			—
Net income available for MAA common shareholders	$	211,915		$	332,287		$	147,980

⁽¹⁾ The 2014 column shows the segment break down based on the 2015 same store portfolios. A comparison using the 2016 same store portfolio would not be comparative due to the nature of the segment classifications.

Assets for each reportable segment as of December 31, 2016 and 2015 were as follows (dollars in thousands):

	December 31, 2016		December 31, 2015
Assets
Large Market Same Store	$	3,945,122	$	4,062,595
Secondary Market Same Store	1,707,495		1,756,313
Non-Same Store and Other	5,722,231		956,336
Corporate assets	229,643		72,537
Total assets	$	11,604,491	$	6,847,781