Borrowings

6 Months Ended

Jun. 30, 2017

Notes To Financial Statements [Abstract]

Schedule of Long-term Debt Instruments [Table Text Block]

Total Outstanding Debt

The following table summarizes our indebtedness at June 30, 2017 (dollars in thousands):

	Borrowed Balance			Effective Rate		Average Contract Maturity
Fixed Rate Secured Debt
Individual property mortgages	$	950,145		4.0	%	9/2/2019
Total fixed rate secured debt	$	950,145		4.0	%	9/2/2019
Variable Rate Secured Debt (1)
Fannie Mae conventional credit facility	160,000			1.6	%	6/1/2018
Total variable rate secured debt	$	160,000		1.6	%	6/1/2018
Fair market value adjustments and debt issuance costs	19,851
Total Secured Debt	$	1,129,996		3.6	%	6/27/2019
Unsecured Debt
Variable rate revolving credit facility	160,000			2.1	%	4/15/2020
Variable rate term loan	300,000			2.0	%	8/29/2020
Term loans fixed with swaps	550,000			3.1	%	4/17/2018
Fixed rate bonds	2,460,000			4.0	%	5/20/2024
Fair market value adjustments, debt issuance costs and discounts	(26,944		)
Total Unsecured Debt	$	3,443,056		3.6	%	11/20/2022
Total Outstanding Debt	$	4,573,052		3.6	%	12/29/2021

⁽¹⁾ Includes capped balances.

Notes Payable

Borrowings

The weighted average interest rate at June 30, 2017 for the $4.6 billion of debt outstanding was 3.6%, compared to the weighted average interest rate of 3.5% on $4.5 billion of debt outstanding at December 31, 2016. Our debt consists of an unsecured revolving 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 Note 7.

At June 30, 2017, we had $3.0 billion of senior unsecured notes and term loans fixed at an average interest rate of 3.8%, $300.0 million of variable rate term loans with an average interest rate of 2.0%, and a $1.0 billion variable rate revolving credit facility with an average interest rate of 2.1% with $160.0 million borrowed at June 30, 2017. Additionally, we had $110.0 million of secured variable rate debt outstanding at an average interest rate of 1.6% and $50.0 million of capped secured variable rate debt at an average interest rate of 1.6%. The interest rate on all other secured debt, totaling $970.0 million, was hedged or fixed at an average interest rate of 3.6%.

Unsecured Revolving Credit Facility

We maintain a $1.0 billion unsecured credit facility with a syndicate of 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 2.13%. The KeyBank Facility expires in April 2020 with an option to extend for an additional six months. At June 30, 2017, we had $160.0 million actually borrowed under this facility, and another approximately $2.3 million of the facility used to support letters of credit.

Unsecured Term Loans

We also maintain four term loans with a syndicate of banks, one led by KeyBank National Association, or KeyBank, two by Wells Fargo Bank, N.A., or Wells Fargo, and one by U.S. Bank National Association, or U.S. Bank, respectively. The KeyBank term loan has a balance of $150.0 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 loans have balances of $250.0 million and $300.0 million, respectively, mature in 2018 and 2022, respectively, and have variable interest rates of LIBOR plus a spread of 0.90% to 1.90% and 0.90% to 1.75%, respectively. The U.S. Bank term loan has a balance of $150.0 million, matures in 2020, and has a variable interest rate of LIBOR plus a spread of 0.90% to 1.90% based on our credit ratings.

Senior Unsecured Notes

As ofJune 30, 2017, we had approximately $2.2 billion (face value) of publicly issued notes and $310 million of private placement notes. These senior unsecured notes had maturities at issuance ranging from five to twelve years, averaging 6.9 years remaining until maturity as of June 30, 2017.

On May 9, 2017, the Operating Partnership publicly issued $600.0 million in aggregate principal amount of notes, maturing on June 1, 2027 with an interest rate of 3.60% per annum, or the 2027 Notes. The purchase price paid by the initial purchasers was 99.58% of the principal amount. The 2027 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 2027 Notes is payable on June 1 and December 1 of each year, beginning on December 1, 2017. The net proceeds from the offering, after deducting the original issue discount of approximately $2.5 million and underwriting commissions and expenses of approximately $3.9 million, were approximately $593.6 million. The 2027 Notes have been reflected net of discount and debt issuance costs in the Condensed Consolidated Balance Sheet. In connection with the issuance of the 2027 Notes, we cash settled $300 million in forward interest rate swap agreements, entered into earlier in the year to effectively lock the interest rate on the planned transaction, which produced an effective interest rate of 3.68% over the ten year life of the 2027 Notes.

Secured Credit Facility

We maintain a $160.0 million secured credit facility with Prudential Mortgage Capital, which is credit enhanced by Fannie Mae, or the Fannie Mae Facility. The Fannie Mae Facility has maturities from 2017 through 2018. Borrowings under the Fannie Mae Facility totaled $160.0 million at June 30, 2017, all of which was variable rate at an average interest rate of 1.6%. The available borrowing capacity at June 30, 2017 was $160.0 million.

Secured Property Mortgages

At June 30, 2017, we had $1.0 billion of fixed rate conventional property mortgages with an average interest rate of 4.0% and an average maturity in 2019.

On February 7, 2017, we paid off a $15.8 million mortgage associated with the Grand Cypress apartment community. The loan was scheduled for maturity in August 2017.

On May 31, 2017, we paid off a $156.4 million mortgage associated with the following apartment communities: CG at Edgewater, CG at Madison, CG at Seven Oaks, CG at Town Park, CG at Barrett Creek, CG at River Oaks, and CG at Huntersville. The loan was scheduled for maturity in June 2019.

In addition to these payoffs, we paid $6.0 million associated with property mortgage principal amortizations during the six months ended June 30, 2017.

Guarantees

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

• $160.0 million of the Fannie Mae Facility, of which $160.0 million has been borrowed as of June 30, 2017; and

• $310.0 million of the privately placed senior unsecured notes, all of which has been borrowed as of June 30, 2017.

Total Outstanding Debt

The following table summarizes our indebtedness at June 30, 2017 (dollars in thousands):

	Borrowed Balance			Effective Rate		Average Contract Maturity
Fixed Rate Secured Debt
Individual property mortgages	$	950,145		4.0	%	9/2/2019
Total fixed rate secured debt	$	950,145		4.0	%	9/2/2019
Variable Rate Secured Debt (1)
Fannie Mae conventional credit facility	160,000			1.6	%	6/1/2018
Total variable rate secured debt	$	160,000		1.6	%	6/1/2018
Fair market value adjustments and debt issuance costs	19,851
Total Secured Debt	$	1,129,996		3.6	%	6/27/2019
Unsecured Debt
Variable rate revolving credit facility	160,000			2.1	%	4/15/2020
Variable rate term loan	300,000			2.0	%	8/29/2020
Term loans fixed with swaps	550,000			3.1	%	4/17/2018
Fixed rate bonds	2,460,000			4.0	%	5/20/2024
Fair market value adjustments, debt issuance costs and discounts	(26,944		)
Total Unsecured Debt	$	3,443,056		3.6	%	11/20/2022
Total Outstanding Debt	$	4,573,052		3.6	%	12/29/2021

⁽¹⁾ Includes capped balances.