Good morning, ladies and gentlemen. Welcome to the MAA Q4 and full year 2020 earnings conference call. During the presentation, all participants will be in a listen only mode. Afterwards, the companies will conduct a question and answer session. As a reminder, this conference is being recorded today, February 4th, 2021. I will now turn the conference over to Tim Argo, Senior Vice President, Finance for MAA. Thank you, Ashley. Good morning, everyone. This is Tim Argo, Senior Vice President of Finance for MAA. With me are Eric Bolton, our CEO, Al Campbell, our CFO, Rob DelPriore, our General Counsel, Tom Grimes, our COO, and Brad Hill, our Head of Transactions. Before we begin with our prepared comments this morning, I want to point out that as part of the discussion, company management will be making forward-looking statements. Actual results may differ materially from our projections. We encourage you to refer to the forward-looking statements section in yesterday's earnings release and our 34 Act filings with the SEC, which describe risk factors that may impact future results. These reports, along with a copy of today's prepared comments and an audio copy of this morning's call, will be available on our website. During this call, we will also discuss certain non-GAAP financial measures. A presentation of the most directly comparable GAAP financial measures, as well as reconciliations of the differences between non-GAAP and comparable GAAP measures can be found in our earnings release and supplemental financial data, which are available on the For Investors page of our website at www.maac.com. I will now turn the call over to Eric. Thanks, Tim. We appreciate everyone joining us this morning. As detailed in our Q4 earnings report, MAA ended 2020 on a positive note. We carry good momentum into calendar year 2021. During the Q4, leasing traffic was strong, and we captured 6% higher move-ins as compared to prior year. Despite the normal seasonal slowdown during the holidays, we were able to capture positive blended lease-over-lease rent growth that equals the prior Q3, with particularly strong renewal lease pricing averaging 5.2% in Q4. Average physical occupancy also remained strong at 95.7% in the Q4, a slight improvement from the performance in Q3. We believe these trends, supported by improving employment conditions and the positive migration trends across our footprint, positions MAA for continued outperformance into the coming spring and summer leasing season. Overall, conditions are setting up for a solid recovery cycle for apartment leasing fundamentals across the Sun Belt over the next three years or so as demand recovers and supply levels moderate a bit into 2022. I believe for several reasons that MAA is in particularly strong position as we head into the recovery part of the cycle. First, we expect that our Sun Belt markets will continue to capture job growth, migration trends, and demand for apartment housing that will be well ahead of national trends. While there were clearly favorable Sun Belt migration trends by both employers and households prior to COVID, this past year, the trends accelerated. The primary reasons behind these favorable migration trends, including an enhanced affordability, favorable business climates, and lower taxes, will still be with us well past the point we get the pressures associated with COVID behind us. Secondly, the efforts we have underway this past year implementing change to a number of our processes involving new technology and web-based tools will continue to drive more opportunity for margin expansion. Specifically, steps taken to automate aspects of both our leasing and maintenance service operations will drive more efficiency with personnel costs. We expect to begin harvesting some of those early benefits later this year. Our redevelopment operation aimed at upgrading and repositioning many of our existing properties continues to capture very attractive rent growth and returns on capital. The higher levels of new apartment supply introduced into a number of markets over the past year will actually expand this redevelopment opportunity for us over the next couple of years. As outlined in the supplemental schedules to the earnings release, we also expanded our new development pipeline in the Q4 with just over 2,600 units now underway. Our external growth pipeline executed through in-house development, pre-purchase of joint venture development projects, and the acquisition of existing properties will continue to expand over the next year. In addition to the projects outlined in our current pipeline schedule included in our earnings release, we have pre-development activity currently underway with sites we own or have tied up in Denver, Tampa, Raleigh, and Salt Lake City. Finally, and importantly, our balance sheet remains in a very strong position, with ample capacities to support both our redevelopment and our new growth initiatives. Calendar year 2020 was certainly not the year we expected, but MAA's full cycle strategy with a uniquely diversified portfolio across the Sun Belt, supported by a strong operating platform and balance sheet, positioned the company to hold up well. Before turning the call over to Tom, I want to also say thank you to our MAA associates for a tremendous year of service and support to our residents, our shareholders, and to each other. Our strategy is working, and our platform capabilities are strong. It's your intensity and passion for serving those who depend on our company that enables us to truly excel. Tom? Thank you, Eric. Good morning, everyone. The recovery we saw beginning in May and June continued across the portfolio through the Q4. Leasing volume for the quarter was up 6%. This allowed us to improve average daily occupancy from 95.6 in the Q3 to 95.7 in the Q4. In addition to the improvement in occupancy, we were able to hold blended rents in the Q4 in line with the Q3 at an 80 basis point increase. All in-place rents or effective rent growth on a year-over-year basis improved 1.3% for the Q4. As noted in the release, collections during the quarter were strong. We collected 99.2% of billed rent in the Q4. This is the same result we had in the Q3 of 2020. We've worked diligently to identify and support those who need help because of COVID-19. The numbers of those seeking assistance has dropped over time. In April, we had 5,600 residents on relief plans. The number of participants has decreased to just 491 for the January rental assistance plan. This represents less than 0.5% of our 100,000 units. We saw steady interest in our product upgrade initiatives. During the Q4, we made progress on our interior unit redevelopment program, as well as the installation of our smart home technology package that includes mobile control of lights, thermostat, and security, as well as leak detection. For the full year 2020, we installed 23,950 smart home packages and completed just over 4,200 interior unit upgrades. January's collections are in line with the good results we saw in the Q4. As of January 31st, we've collected 98.7% of rent billed, which is comparable to the month-end number for the third and Q4s of 2020. Leasing volume in January was strong, up 4.9% from last year. Blended lease-over-lease rent growth effective during January exceeded last year's results for the first time since March. Effective blended lease-over-lease pricing for January was positive 2.2%, a 40 basis improvement from the prior year. Effective new lease pricing for January was -1.8%. This is a 70 basis point improvement from January of last year. January renewals effective during the month were up 6.3%. Our customer service scores improved 110 basis points over the prior year. This aids to our retention trends, which are positive for January, February, and March, as well as lease-over-lease renewal rates for those months, which are in the 5.5- 6.5 range. Average daily occupancy for the month of January is 95.4%, which is even with January of last year. 60-day exposure, which is all vacant units plus notices through a 60-day period, is just 7.8%. We're well-positioned as we move into 2021. Led by job growth, which is expected to increase 3.4% in 2021 versus the 6.1% drop we saw for our markets in 2020, we expect to see the broad recovery in our region of the country continue. We expect Phoenix, Tampa, Raleigh, and Jacksonville to be our strongest markets and expect Houston, Orlando, and D.C. to recover at a slower rate. I'd like to echo Eric's comments and thank our teams as well. They served and cared for our residents and our associates, and they have adapted to new business conditions, and they drive our recovery. Well done, and thank you all. I'll now turn the call over to Brad. Thanks, Tom. Good morning, everyone. While most buyers have returned to the market, the lack of available for-sale properties continues to restrict transaction volume. Investor demand for multifamily product within our region of the country is very strong. This supply-demand imbalance is driving aggressive pricing. Due to the robust demand supported by continued low interest rates, cap rates have compressed further and are frequently in the high 3% and low 4% range for high-quality properties in desirable locations within our markets. We expect to remain active in the transaction market this year. Based on pricing levels we're currently seeing, we're not optimistic that we will succeed in finding existing communities that will clear our underwriting hurdles in 2021. While acquiring will be a challenge, as noted in the earnings guidance, we do plan to come to market with $200 million-$250 million of planned property dispositions this year. We will redeploy those proceeds into our growing development pipeline, which currently stands at $595 million with eight projects and just over 2,600 units. In the Q4, we started construction on the MAA Windmill Hill in Austin, Texas, as well as NOVEL Val Vista, a pre-purchase in Phoenix, Arizona. Both of these are lower density suburban projects that we expect to deliver stabilized NOI yields around 6%, well in excess of our current acquisition cap rates. Despite increased construction costs, as well as some supply chain issues related specifically to cabinets and appliances, our development and pre-purchase projects remain on budget with no significant delay concerns at this point. We have several other development sites owned or under contract that we hope to start construction on in 2021 and into 2022. We are encouraged that despite facing some supply pressure, our phase II lease-up property located in Fort Worth continues to lease up at our original expectations, as does our soon-to-be-completed phase II in Dallas, where over 90% of the units have been delivered. Turning to the outlook for new supply deliveries in 2021, based on our assessment and the projection data we have, new supply deliveries across our major markets are projected to remain flat with 2020 levels at 2.8% of existing inventory. Consistent with previous years, we expect delayed starts, extended construction schedules, canceled projects, and overall construction capacity constraints to continue to impact actual supply deliveries to some degree. While clearly new supply does have an impact on our business, it's just one side of the equation, with demand playing a significant role as well. For reasons Eric mentioned in his comments, we believe the demand for multi-family housing within our region of the country will remain strong and improve this year as the economy continues to recover. When looking at the ratios for expected job growth to new supply deliveries in 2021, we expect leasing conditions in our footprint to improve from last year. Encouragingly, the data on permitting activity and construction starts for our region of the country continue to show activity below pre-pandemic levels. This drop in activity will likely lead to a moderating level of new supply deliveries into 2022, setting up for what we believe will be an improved leasing environment beyond this year. That's all I have in the way of prepared comments. With that, I'll turn it over to Al. Okay. Thank you, Brad, good morning. core FFO of $1.65 per share for the Q4 produced full-year core FFO of $6.43 per share, which represented a 2.7% growth over the prior year and is well above our internal expectations following the breakout of the pandemic. Stable occupancy, strong collections, and positive pricing performance were the primary drivers of continued same-store revenue growth for the Q4, which was 1.8%, and for the full year, which is 2.5%. As expected, same-store operating expenses for the Q4 were impacted by growth in real estate taxes, insurance costs, and the continued rollout of the bulk internet program, which is included in utilities expenses. Though some of this pressure will carry into 2021, we expect overall same-store operating expenses to begin moderating this year, which I'll discuss just a bit more in a moment. Our balance sheet remains in great shape. We had no significant refinancing activity during the Q4, but we continue to fund the development pipeline and internal redevelopment programs. As Brad mentioned, our development pipeline has increased to eight deals, with total projected costs of $595 million. During the quarter, we funded $104 million of development costs, leaving less than half, or another $259 million remaining to be funded toward the completion of the current pipeline. Though still growing, our pipeline is only about 3% of our enterprise value, which is a modest risk given the overall strength of our balance sheet and the diversified portfolio strategy. As Tom mentioned, we also made good progress during the quarter on our internal programs, funding a total of $40 million toward the interior unit redevelopments, smart home installations, and external amenity upgrades, bringing our full-year funding for these programs to $76 million, which is expected to begin contributing to our growth more strongly late in 2021 and 2022. We ended the year with low leverage, debt to EBITDA of only 4.8 times, and with $850 million of combined cash and borrowing capacity under our line of credit. We provided initial earnings guidance for 2021 with our release, which is detailed in our supplemental information package. Core FFO for the full year is projected to be $6.30-$6.60 per share, which is $6.45 at the midpoint. The primary driver of earnings performance is same-store revenue growth, which is projected to be around 2% for the year. This growth is based on the expectation of continued improving economic trends and job growth in our markets, as Tom outlined. We believe these trends will support both stable occupancy levels, averaging around 95.5% for the year, and modestly improving pricing trends through the year, driving effective rent growth for the year of around 1.7%. An additional contribution of 30- 40 basis points of projected revenue growth for the year is related to the final portion of our Double Play bulk Internet program. We do expect the Q1 to be our lowest revenue growth for the year, as it will bear the full impact of 2020's pricing performance, growing from there as the improving leasing trends take full effect. Same-store operating expense growth is projected to moderate some as compared to 2020, but will continue to be impacted by the rollout of Double Play and higher insurance costs, with these costs combining for an estimated 1.4% for the same-store expense growth in 2021. Excluding Double Play and insurance, all other same-store expenses are expected to increase in a more modest 2.5%-3% range for the full year. This includes real estate tax growth of 3.75% at the midpoint, which is moderating but still somewhat elevated. Overhead costs for 2021 are projected to be more normalized, with total overhead expenses expected to be about $107 million for the year, which is a 2.8% increase over the midpoint of our original guidance for 2020. Our forecast also assumes development funding $250 million-$350 million for the year, primarily provided by projected asset sales of $200 million-$250 million. Given our current forecast, we have no current plans to raise additional equity, and we expect to end the year with our debt to EBITDA just below five times. That's all we have in the way of prepared comments. Ashley, we'll now turn the call back over to you for any questions. Certainly. We will now open the call for questions. If you would like to ask a question, please press star then one on your touchtone phone. If you would like to withdraw your question, you may press the pound key. We will take our first question from Sumit Sharma with Scotiabank. Please go ahead. Hi, good morning. Thank you for taking my question. Thank you for providing all the color on the stats in Q4. I guess, to kick things off, in terms of the SS rev growth this year, I know you mentioned that Tampa and Phoenix were one of your stronger markets. Just wondering, as you looked at 2020, Phoenix was your strongest performer, Orlando was the weakest. The spread in SS revs was 630 basis points. In Q4, that changed. Tampa was better and Orlando the weakest. I guess, what's that spread look like in the context of your 2021 guidance of 1%- 3%? Where do you see the most meaningful change in performance, in terms of things you already know about? Yeah, I'll start with that one, and let Tim or Al wrap up on the forecast. What I would tell you is, as I mentioned in the call, the thing that is most different for us in 2021 is the shift in the swing in jobs, swinging from -6.4% - +3.4%. That's going to be the thing that drives us, and that moves across the markets. We see that at the high end, where we'll continue to see markets like Tampa and Raleigh and Phoenix and Jacksonville accelerate. We'll also see it in places like Orlando, in Houston, in D.C., which are weaker now, but they will begin to improve as job growth comes to play in those markets. Yeah, just looking to the future in what we have in our forecast, the 2% overall, you just think about the markets. Some of the markets that we're thinking will be the strongest, as Tom talked about, mentioned Phoenix, Raleigh, Tampa, Jacksonville. Some of the ones that are going to be okay markets, so that are going to be reasonable, but still challenging, Atlanta, Dallas, Austin. Some of the more challenging markets are Houston, Orlando, and D.C. I think all of those together, and based on the pricing trends we see right now and expect for the year, given the job growth, come to 2% expectation. Got it. Thank you so much for the color. One more, if you will indulge me on supply. Now you talked about 2021 supply being priced 25% higher and centered in urban and downtown markets or sub-markets. I guess, the permit levels are at lower levels than pre-COVID levels, but they are increasing as we've heard from other market participants as well. Keeping that in mind, do you have any insights to share on what types of markets or products or price points that are being emphasized by the new permits? Not the '21 deliveries, but what's being started right now. Are they more garden style, more urban, less urban? Any color on that? Yeah, this is Brad. I would say that, just given the economics of what we're seeing today, it's really hard to underwrite more urban, high-density products. I think it's safe to assume that a higher% of the product that's being developed today is more suburban in nature. I'd say having said that, when we look at the spread between the rents of new supply that's coming online versus our properties, that spread is still really good. As Eric said, that's leading to more redevelopment opportunities for us. We think that that continues. It's hard to say where, just looking at permitting trends, while they're clearly down versus pre-COVID-19 levels, I would say construction starts are down even more. It's hard to say just from the permitting data where that supply is located, but my sense is it's going to be more suburban in nature. Given the economics of where costs are, the rent levels of those are still going to be pretty substantial compared to our current product. This is Eric. Something I'll add to what Brad is saying. I agree. Based on everything that I've seen, that it does would appear that the majority of a lot of the new permitting activity is oriented more suburban in nature. Having said that, one of the things that we're really starting to see more evidence of is, frankly, entitlement and permitting is getting more challenging as more of this multi-housing product heads to the suburbs. We're seeing a lot of, particularly in the satellite cities or the suburban cities, if you will, that have their own school systems and their own municipal governments. They are becoming very restrictive about what they are allowing in the way of apartment permitting, believing that these additional households will put some level of stress on the infrastructure. We're seeing that the permitting activity is starting to get a lot more restrictive than it ever has been in a lot of these southeastern markets. I think there is another, if you will, hurdle starting to develop across some of these southeast markets that will make it increasingly a little bit more challenging to supply some of these suburban locations. Thank you so much for the color. I'll yield my time. Thank you. We'll take our next question from Neil Malkin with Capital One. Please go ahead. Hey, everyone. Good morning. Hey, Neil. Morning. Hey. This is the first time I think that you guys have really called out, or Eric, your comments have called out the in-migration. Can you maybe talk to that, what you've seen over the recent months? In terms of that sort of out-migration from the coast, just given the confluence of bad factors that the coasts are facing, which have been exacerbated by the COVID and work from home. I think last quarter you laid out some statistics about what percentage of your new leases were from out of state. If you could just update us on that and any incremental commentary from the property level managers would be great to hear. Thank you. Yeah, Neil, it's Tom. I'll jump in on that one if that's all right. Move-ins from people moving into our footprint from outside of our footprint was 12.2% of total move-ins in Q4. That's the highest we've seen and reflects the steady upward trend that we've seen over the past couple of years. For context, it was 9.2% in Q1 of 2019, almost a 300 basis point increase. We've seen that steadily happening from 2019 on. Just to give you a little bit more color on the Q4 move-ins, move-ins from New York State were up 36%. Apartment searches, we pulled some information from Google. Apartment searches in Atlanta were up 60% in New York City. Move-ins from Massachusetts were up 43%, apartments in Raleigh searches were up 68% in Boston. Trends go on from there. The other notable is probably California, which is up 60%, and apartments in Austin, searches were up 90% in Los Angeles. Neil, this is Eric. Just to add on to some of that detail that Tom laid out there. I do think that there are a lot of reasons to believe that a lot of this migration trend that we saw of the U.S. population to the Southeast over the past year, as I mentioned in my comments earlier, a lot of these trends were evident prior to COVID. COVID accelerated those trends somewhat. I would tell you that I believe a lot of the moves that took place during 2020 are pretty sticky in nature, and I think that the trends are likely to continue post-COVID. I think you have to recognize a lot of these Southeastern markets, they continue to offer all the same attractive qualities that I think started the trend some years back. What is happening as more employers are bringing more knowledge-based jobs and tech jobs into this region of the country, the employment base is really starting to further diversify. Of course, work from home and these knowledge-based jobs allows a lot more remote working, which I think is also working in our favor. I think that a combination of just how these economic trends have been building, frankly, and these job and migration trends have been building for the last 10 years or so, recognizing accelerated a little bit last year. Those trends were in place well before COVID-19, and I think will continue past COVID-19. The affordability of the region, particularly as it relates to housing, continues to, I think, be very attractive and will become even more so over the next 10 years. I think we also have to recognize that these Sun Belt markets are continuing to become very desirable places to live. What Nashville and what Austin and what Raleigh have to offer people today versus where they were 20 years ago is night and day difference. I'm very optimistic that we are at the beginning of some continued very favorable trends for housing needs throughout this region of the country. Thank you. Eric, I guess what you're saying is you think it will take longer, or it may not happen for the people who've moved to your areas to make the trek back to the coastal urban cities? Yeah. I think the idea that once a vaccine is in place and if you will, society returns to normal, the idea that there's going to be this giant reversal of population shift back to the gateway markets, I think that's a ridiculous argument. I don't think that's going to happen. Those trends were in place to the Southeast and Sun Belt markets before COVID. COVID accelerated it a little bit. We learned a lot last year, and employers learned a lot, and households learned a lot. I think the attractiveness of this region is better understood today than it ever has been. I think these trends are going to continue. That's great. Other one from me. The single-family market has been very strong. You have new and existing home sales and mortgage applications at multiyear highs. Just wondering, and obviously you guys are theoretically more exposed to that sort of risk, just given the relative affordability. Have you seen any uptick in move-outs for home purchases or home rentals or anything like that would give you some reticence just in terms of potential demand erosion, let's say, over the next 12 months? Hey, Neil, it's Tom. Nothing, zero reticence, I would say. We're quite pleased with the way the market conditions are going at this point. In the Q4, home buying this time was up slightly by like three percentage points as a move-out reason, or about 200 move-outs on total. We saw a little bit there. As you look forward, our accept rates are at their normal levels, so we're not seeing turnover go up over time there, and home renting is flat again. That continues not to be a major factor. We agree with you that the overall home buying market's certainly getting stronger, and we wouldn't surprise to see that tick up from time to time. It's really reflective of a strong jobs market and a good economy, and that produces jobs, and frankly, jobs are the thing that drive our business. That would be my thought thus far. All right. Thank you guys for the time. Love the Sun Belt. Thank you, Neil. We do too. We'll take our next question from Nick Joseph with Citi. Please go ahead. Hey, it's Michael Bilerman here with Nick. I had a question that Nick had another one as well. Eric, as you think about, and I know how positive you are on the current markets in the Sun Belt, and all the trends that have been accelerated away from the gateway markets. You inherited D.C. when you bought Post. I don't know if it was a gift with purchase or whatever, but you got some exposure to some coastal exposure in the Northeast. What would make you come in and want to buy or develop any gateway markets? I guess, at what point does the risk-reward, what needs to happen, A, from a diversification standpoint? Is it trends? Is it relative values, growth profiles? I guess, where is your mindset about that today? If everyone is zigging, maybe you want to zag, and maybe there would be a good opportunity from a value perspective there. Well, Michael, I would tell you that my principles and sort of the philosophy that I've always had in terms of how we think about deploying capital really continues to be grounded in the overriding belief that the most important thing that we're charged with doing is deploying capital in a manner to create the highest recurring quality revenue stream and earning stream that we can to pay a steady growing dividend throughout the cycle, if you will, and creating an optimized sort of full-cycle performance profile. At the end of the day, I think REIT shareholder capital over a long period of time is largely rewarded through steady earnings growth, obviously, and particularly dividend growth. Having said that, I've always believed then that the best way to accomplish that performance objective and that profile is deploy capital where demand is likely to be the best and the strongest and growing in a consistent fashion over a long period of time. I get it that the Southeast markets, for years, the argument and criticism was that there are lower barriers to supply, and new supply can come in and oversupply a market. What I would tell you is what supply causes is it causes moderation. What demand causes is steady earnings growth over time, and a falloff in demand can have catastrophic consequences. An oversupplied market is unlikely to be catastrophic in nature. It can be weak for a year or two, but it's unlikely to trigger a massive sort of upset to your earnings stream, which can put a company in trouble, create dividend stress, or things of that nature. I've always believed that these Sun Belt markets offer the performance profile that we're after, and that's what we should be doing and where we should focus our capital. It's a very long answer to your question, but no, we have no interest in now using this opportunity to go into these gateway markets. I don't think what we're trying to do for shareholder capital would not be sufficiently rewarded for pursuing that. At this point, we don't see a reason to do that, and we like what we're doing. How do you think about just the risk-reward from a return perspective, right? I think you're extraordinarily fortunate to be so heavy in these markets, having built the platform that you've done through a lot of hard work in acquisitions and M&A and development. There's a lot of capital chasing these markets too, which is going to drive down returns overall. I'm not ignoring the fact that the demand is extraordinarily strong. Is there a financial side of it too, that as money's coming out of these gateways, that you could create a better total return by deploying capital or reallocating capital in the portfolio? Is that just not, in your view, the demand is not there, so it doesn't matter if I can get 100 basis points or 200 basis points higher initial return out of it? No, I get your point, and obviously, I think it depends somewhat on your investment horizon. As you think about risk-reward return, I think clearly there's going to be opportunities that are going to emerge in some of these gateway markets where you can go in and deploy capital and make an investment and create an exceptional return on your investment. I think it somewhat depends on your horizon and how long you want to think about the capital being deployed in that market. Again, from our perspective, we're very long-term investors, very long-term holders, and we're trying to create an earnings profile from that investment action to match up well in terms of how we're trying to perform for capital over a long period of time. We just don't believe that with that horizon that we're working with and that objective that we're shooting for, that the gateway markets really align for us in the way we want to try to perform for capital. I'm not suggesting that focusing on those markets is wrong. I think there are certainly ways to make a lot of money in those markets. I think you have to think about your horizon perhaps a little bit differently. I will say that while we continue to see capital coming into these markets, I think that there are times where these gateway markets over the last, and you know this, over the last 10 or 15 years, just attracting enormous amount of capital, and a lot of international capital sometimes that I think. was really motivated by not so much looking for a great return on their capital, in some cases, just looking for a place to preserve capital, if you will. You get a lot of different influences in some of these bigger gateway markets, and particularly with international capital, that can, I think, create some distortions from time to time in terms of assets are being priced relative to the long-term earnings potential of the investment. We just see volatility and other aspects of those gateway markets that just don't really match up well to how we're trying to perform for capital. We're going to continue to focus on it the way we do. Thanks. Appreciate that. This is Nick. Just one other question on guidance. The Q1 range is pretty wide. Obviously, we're a month into the quarter, and there are few leases that are signed. I recognize, still the uncertainty, but I was just wondering if you can walk through how you could end up at the high end or the low end. Then specific to your same-store revenue comment, where you expect same-store revenue to be in the Q1. I know you said it should be the lowest point of the year. Yeah. Nick, this is Al. I think just overall, just given the uncertainty that's in the marketplace, I think that the Q1 being the Q1 of the year and where you have the most uncertainty, I think the range was just to reflect that. I think the driver for the forecast for the whole year is based on revenue performance, so I think that's the key to be the top or the bottom of the range and really for the year or for the quarters. I think, the Q1, as talked about a little bit in the comments, is expected to be the lowest revenue quarter for the year, but that's really reflecting effective rent per unit, which is a backward or a trailing indicator, which is a combination of the pricing you did last year, plus what you're doing this year. We're expecting improving pricing trends, but the Q1 will be the lowest revenue quarter because it will reflect really, the bulk of last year's pricing, which was 1.3% on average, and we certainly expect that to be higher in 2021, based on the forecast we're putting together. That's really the key factors. I hope that answers your question. Thanks, Al. Thank you. We'll take our next question from Rob Stevenson with Janney. Please go ahead. Hi. Good morning, guys. Tom, there was nearly an 800 basis point delta between the new lease rate and the renewals. How sustainable is that type of spread? Given that pricing's out there on the internet, why aren't residents pushing you guys harder on renewals? The spread is always going to be kind of the widest at this time of the year, Rob, because new lease pricing is at its most challenged. That delta will close over time, but that gap will always be there. Really, the variation is with a new renter, they have a level of leverage because they're shopping and they can move anywhere, and their switching costs are really the same. If we have done our job and provided good resident service in taking care of the residents in, frankly, a pretty challenging time, we've earned the opportunity because we've created for value to charge a little bit more. That is where we have the most pricing power because, we've worked with them, we've earned them, and their switching costs are a little bit higher. That delta that you talk about has always been there. It is widest in this time of year, it will be tightest in the summer months. We expect that, and we plan for that. We ask our residents for a little more to reflect the value that we've created for them. Implied in the guidance for the year, where are you guys thinking that new lease versus renewals winds up coming in? Are we talking about something that's more or less flat on new leases or still negative there? How significant is the guidance anticipating renewals being? Rob, this is Tim. I think what we would expect overall is that new lease pricing probably slightly negative. It's very seasonal, as Tom mentioned, and depends on the leading edge of demand. You'll see pretty negative in Q1, Q4 move to positive as we get into the summer. I think over the average, probably a little bit negative. Renewals kind of hanging in there like they have, anywhere in that five to six range and, again, varying some with a little bit higher in the summer, a little bit weaker in the fall and winter. Okay. The other one for me is, you guys did call it $424 million of revenues in 2020. How much of that is non-residential, so retail, commercial, other spaces at your properties? Where did that wind up coming in versus expectations a year ago? What was the negative delta? How significantly was that impacted over the last year versus what you would've expected this time a year ago? I think the major component that's outside of residential is really just commercial, and it's only about 1.5% of our revenue stream, so it's really minor overall, Rob. We've had pretty good performance. We've looked at our tenants, and we certainly have some programs to defer rent where we need to, but we had good collection on. A lot of our tenants are very strong and have strong businesses that have been able to continue paying well. Collections have been good. Even on a small number, we've had pretty good performance still on a relative basis. The occupancy there, are you guys fairly full? Is that half full? How are you guys sort of characterizing, even though it's a small percentage, given that it's also amenity space for some of your tenants as well, I assume? Hey, Rob, it's Rob. Don't worry. We're sitting at about 85%-90% occupied, and we've collected about 90% of the revenues in cash on the commercial side. Perfect. Thanks, guys, appreciate it. We'll take our next question from Amanda Sweitzer with Baird. Please go ahead. Great. Thanks. Good morning, everyone. Good morning. Can you talk a little bit more about what you're seeing today in terms of construction financing? Have you seen the large money center banks come back to the market at all? How have development loan terms changed relative to pre-COVID, both in terms of interest rates and then LTVs? Yeah, Amanda, this is Brad. I'd say that the construction financing is really kind of a mixed bag. I think it depends on a few things. One, the markets that folks are looking in. Certainly, some markets are easier to get financing in or less hard to get financing in than others. I think it also depends on the sponsor. I think what we're seeing is generally for the larger developers, the strong sponsors that historically have had pretty good pipelines, they're still able to get financing. I think the smaller developers that do just a handful of deals a year, they're not as strong, they don't have as strong of a relationship with the banks, are having a little bit tougher time getting their debt financing lined up. That certainly has been an impact in financing, and that also certainly leads to some of our pre-purchase opportunities. In terms of loan terms, we're seeing, call it 10-year rates in that 4%-4.5% range for construction financing, which I think is still decent at the moment. Really, the biggest change we've seen in construction or in financing, not constructive financing, but is really has to do with the low cap rates that we're currently seeing for these stabilized assets. The low cap rates are starting to drive some LTV movement in order for debt service coverage ratios to continue to be held. We are seeing loan-to-values come down a bit. We're not seeing any impact yet on pricing, but we'll really just see how that unfolds later this year as more opportunities come to market. That's basically what we're seeing at the moment. That's helpful. On your comment about that cap rate compression, what's kind of a reasonable assumption for a cap rate for your targeted dispositions this year? I think for our dispositions, given that we're selling our Jackson, Mississippi portfolio, which we had on the market last year as 30, 35-year-old product in a tertiary market. You're talking 5%-5.5% cap rate for what we'll look to sell this year. We're looking to sell properties that really don't line up as well with our overall growth strategy. It's going to tend to be older property in some of these smaller markets initially, where really the after CapEx cash flows are really not what we're looking for, and then the long-term growth is obviously not what we're looking for as well. On a historical basis, the cap rates for these properties are still really, really good at the moment, but I'd say 5%-5.5%. Okay. That makes sense. That's it for me. Thanks for the time. We'll go next to Alex Kalmus with Zelman & Associates. Please go ahead. Hi, thank you for taking my question. A quick one on stimulus checks. Given your market backdrop, the stimulus one-time payments will likely go further for your residents than compared to the urban environments. While there's limited historical precedent, how do you think these will play out in terms of your rent negotiations this year? I would think any stimulus check is going to help that situation, but we're frankly in such a strong position on that with our collection rate where it is. It'll help close the gap to get us back to last year, and it would be welcome. It would just primarily help a little bit. Got it. Thank you. Just touching upon the recurring CapEx, I noticed year-over-year, there was a little jump there. Can you provide some additional color in what drove the increase? I think on recurring CapEx, it can be the timing of certain jobs, whether some of the significant jobs like paint jobs and some of the things of that nature. I think over time, we expect for if we put recurring and revenue enhancing together, and we'd expect to spend, call it $1,100- $1,200 per unit, those two together, in 2021, which is fairly significant to what 2020 was, but somewhere in that field for the long term. Yeah, I would add, we had a little bit bigger jump from 2019- 2020 in recurring CapEx, but for 2021, we're projecting a very modest increase in terms of recurring CapEx. Got it. Thank you very much. All right, we'll take our next question from John Kim with BMO Capital Markets. Please go ahead. Thank you. On your prepared remarks, you mentioned blended lease growth rate was 2.2% in January. You expect improving pricing trends this year. Effective rental growth of 1.7% for the year. Assuming that these are apples-to-apples numbers, they're pretty close to it, why wouldn't that effective rent growth for the year be higher? Well, John, this is Al. The effective rent growth, we were talking a moment ago about that a bit. I think that's more of a trailing indicator. It's a combination of all the leases you have in place right now. The pricing performance we had for 2020 was 1.3% on average. What we're projecting for 2020 is certainly higher than that. I think you could do the math, but this is a rough approach, but been a pretty easy way to look at it is take half of what we did in 2020 and half of what we expect to do in 2021, and that'll drive your effective rent growth of 1.7. You can do the math on it and back into, we're expecting something in the 2%-2.5% range on pricing in the Q1 was January was a good indication toward that. Taking what Al just said, if you take half of your lease-over-lease performance, blended lease-over-lease performance for 2020, and half of your blended lease-over-lease performance for 2021 collected or together, that comprises what your effective will be for the year. That's the back of the envelope way to do it, but I think if you do that, given that we have leases of on average of a year, that works out pretty close, and you can get to where we are in our forecast. Okay. Your redevelopment pipeline was just up 15% sequentially this quarter. Can you just remind us how long you think it'll take to complete this 10,000 units-15,000 units of redevelopment? In terms of the pipeline going forward, we'll do over 5,000 units in 2021 towards that. What we've found, John, over time, is that as we move forward, our product ages another year and new supply is brought into the market. I would be surprised if we ever blew through our potential on that. At this rate, it'd be about three years, but I would expect us to see the pipeline grow over time as new properties are added to it. As market conditions change, product is added, and product ages. John, just to add to what Tom was saying, that as he mentioned, as new product comes into the market, that really what that does is that it expands our opportunity for redevelopment. Historically, at least over the last number of years, where the redevelopment opportunity for us has been the best has been in some of our more urban-oriented locations, which is really where the opportunity largely lies in the portfolio now, particularly with the Legacy Post portfolio. As new supply begins to, over the next few years, if it is more oriented towards the suburban locations, that's actually going to expand our field of opportunity for more extensive redevelopment out in the suburb components of the portfolio. Obviously this new product is coming in at a price point that is well above our existing product. With comparable locations and comparable appeal in that regard, we can go in and make these investments with kitchen and bath upgrades and create a very competitive product and still offer the renter market a slight discount to the newer product and get great returns on capital and get great lease-up success with it. We think that this is a real opportunity for us over the next few years, and we expect it to stay at the same high level for the next three or four years for sure. Is 9.5% a good run rate as far as what you expect as far as an effective rental growth for the pipeline? I'm sorry, say that again. Say that again, John. The nine and a half% rent growth that you had. Oh, yeah. Yeah. We test, and we would expect our return to continue. Absolutely. Okay, great. Thank you. Thanks, John. We'll take our next question from Zach Silverberg with Mizuho. Please go ahead. Hi, good morning. Thanks for taking my question. Could you guys just talk about the opportunity set on your development pipeline? After the two new starts, you're up to about $600 million properties under development. What type of turns are you underwriting? Sort of how does that compare to the acquisition market in those specific markets? Yeah, Zach, this is Brad. I think Eric touched on it a bit in his comments. We do have a number of sites that we're currently working on, pre-development work on. We've got some that are owned, some that are under contract. I'd say in terms of the terms that we're underwriting, not a lot different than what we've underwritten previously. We are fortunate in our markets that the rents have continued to hold up within our markets. We're not having to make some aggressive assumptions with rent trending or some large recovery in rent in our underwriting. The two that we just started, as I said in my comments, we're still looking at north of a 6% yield. Certainly that compares very favorably when you look at Class A brand new products in our markets, what they're trading at today. We continue to believe in that. We have another owned site that we purchased in Denver we hope to start in 2022. We're working on a site in Tampa, a site in Raleigh. Those are likely 2022 sites as well. We have under our pre-purchase platform, we've got one in Salt Lake City that we hope to start in the Q2. Another site in Denver in our pre-purchase platform that we're hopeful will start in the Q3 of this year. Got you. Appreciate the color. In your prepared remarks, you mentioned it was about 3%, I think, of gross assets, and it was moderate risk. What is the maximum and minimum risk you're willing to slide the lever on in between development? I think we've discussed, historically, somewhere around 4%-5% would be a range that we would look at. I think, when you're looking at your actual pipeline relative to your enterprise value, another aspect of risk is how much is unfunded. I point to this fact, though we have $600 million sort of going right now, we only have a fairly small amount that's unfunded. I think those two factors together is what you would consider. We're definitely at the low end of the risk range on that right now, and you'll see our pipeline grow a bit 2021, as Brad talked about, and then early 2022. Certainly, a modest risk program given our profile. Thank you. We'll go next to Rich Anderson with SMBC. Please go ahead. Thanks. Good morning, everybody. Of course, Eric, I didn't expect you to open up the comments suggesting that everyone's going to move out of the Sun Belt next year. No surprise there. If you do look at the statistics, in the period after the last Great Recession, 2010 timeframe, the migration out of New York, for example, substantially slowed. You can argue that there's some real bargains in a lot of other areas that you're not in that could entice people perhaps even more this time around than then. Again, it's never been positive in migration, really. I don't think that's ever happened with the Sun Belt into a market like New York, it probably will normalize. When you mention this 12.2% of total leasing is move-ins from outside your footprint, how much is that impacting your growth profile? You really probably don't want to hang your hat on that type of level for very long. No. I think that we still believe that a lot of the growth that we will have in demand, if you will be people that have been in the Sun Belt will stay in the Sun Belt, organic, if you will. I don't disagree that the 12% Go back two years ago, before COVID-19, the move-ins from outside of our footprint were a little over 9%. Even compared to where we are today with COVID-19, it's only moved up from 9% of our move-ins from outside the footprint to 12%. Your point is valid in that sense. It hasn't changed radically. I feel like that what we're going to find is that over the next I think there's a real fundamental shift that was in place, if you will, to some degree before COVID as employers and job seekers, if you will, were continually drawn to this region of the country as a consequence of all the things that you know about. I just believe that those factors have not moderated. They have not lessened. COVID accelerated them a little bit, but those trends are going to continue well past COVID. I think that what we're finding that, particularly as some of this millennial generation continues to age, they've moved up in their career. They've moved into jobs increasingly that I think offer the ability to be more remote than they have been in the past. That drive that they had to be in New York and work 60, 70 hours a week, that was then. They're in a different place now. I feel like that a combination of, frankly, the aging millennial generation and how their lifestyle needs evolve and desires change, as well as retiring baby boomers who are looking for change and looking for more affordable living, that those two big slugs of the demographics of the U.S., the millennials and the retiring baby boomers, those are huge numbers. As those two age demographics evolve, I think the Sun Belt stands to benefit more so than some of the higher-cost coastal markets. I've heard somebody suggest that, yeah, the coastal markets, the gateway markets are going to come back. They're probably going to come back a little bit cheaper and a little bit younger than they were before. I think there's probably some truth to that. Okay. Good enough. That's good color. Then my second question, perhaps, well, maybe on the uncomfortable side, but I never shy away from that. You've had some sort of C-suite succession activity in some of your peers, Essex, UDR, AvalonBay. I wonder, to your credit, Eric, you have made MAA not an Eric Bolton show. You have a great bench there, and I think everyone recognizes that. Can you talk about how much this team right now today looks to be in place for the next at least few, three, four years? Talk about the succession plan that's perhaps in place for you and others, how that dialogue is happening at the board level. Okay. Well, we can take a poll around the table right now if you want. We won't do that. What I would tell you, Rich, is it's a very active topic at the board level. We discuss it to some degree at every meeting. There's active planning that's underway and continues to this day. I will tell you that I feel great and have no plans to do anything different. I don't play golf and don't really have anything else to do. I'm focused and plan to continue in that way for some time. As you point out, we've got a great team, a great bench strength. The company has been through a lot in the last seven to eight years. The team has really come together. We're developing and focused on leadership development and leadership succession. Frankly, we don't see a lot of change on the near-term horizon. Yeah. Great. You're probably not benching 500 pounds anymore either. No, it's down to 490. Okay, great. Hey, Rich, just a real quick point on what we're hanging our hat on. As you mentioned earlier, supply is going to be pretty much the same. Job growth in 2020 was negative 6.1% in our markets. It's going to be plus 3.4%. That 900 basis point swing in job growth is really what we're hanging our hat on for near-term growth. You got it. Thanks, Tom. Appreciate it. You bet. We'll take our next question from Rick Skidmore with Goldman Sachs. Please go ahead. Hey, Eric. Just a question just with regards to how you think about development going forward and the shift in perhaps working from home and people wanting more space. Are you changing the design of the developments, and does that change the economics in terms of how you think about returns as you go forward? Thanks. Well, Rick, we are a little bit more focused on creating workspace areas, nooks, and things of that nature in a number of our apartments. We're also very much more oriented towards outdoor amenity areas in shared office configurations in some of our leasing centers. Frankly, it's not really having much of an impact on our overall cost of build-out, and we certainly think that there's a lot of reason to continue to introduce more of the support for work from home, but no real significant change in terms of the cost impact for us. Thank you. All right. We'll take our next question from Austin Wurschmidt with KeyBanc. Please go ahead. Hey, good morning, everybody. Could you give us the actual data around what the ratio of jobs to new supply is in 2021 for your markets versus maybe 2019 and some historical averages, if you have that with you? Yeah. Of course. For our group, the jobs to completion ratio last year was negative 8.1. It swings to positive 7.1. I think we've consistently found that 5:1 is a place where we can grow rent. It's a substantial shift, and sort of the key to our rent growth aspirations. Yeah. Appreciate that data point. I think it kind of really goes to some of the questions that I've heard asked, and maybe Eric, your tone just on the recovery in your market seems pretty upbeat. Yet, when you kind of take where Q4 same store revenue growth was, and you look at the midpoint of the guidance, you layer in the accelerating redevelopment. I guess one of the questions we have, and I think others are driving at, is why isn't that driving a little more re-acceleration other than just the earn-in of last year's effective rents? Is there anything else you've assumed in guidance, higher turnover, lower occupancy, that's contributing to maybe a more muted re-acceleration in 2021? No, I think that what you have to recognize is that getting the revenue impact of pricing changes takes time. It takes time to go up, and it takes time to go down. We went into 2020 with some of the highest earned-in leasing performance that we've ever had, and that allowed effective rent per unit to remain fairly strong, if you will, throughout 2020, which was hugely helpful. I remember late in 2019, people asking me what I worried about, and I said I worried about a slowdown. I worried about something happening with the economy. In preparation for that worry, the best thing we could do is grow rents as hard as we could, even at the expense of giving up a little bit of occupancy, and allow that compounding benefit to be there as a protective performance on revenues should we see the economy weaken. That certainly helped us this past year. What I would tell you, there are two things at play here that I think are going to cause the recovery process, the recovery slope, to be steady as opposed to being a real steep up curve, if you will. One is we are still battling supply issues, and we will have those supply issues throughout 2021 pretty consistent with what we saw in 2020. We think it actually peaks in the first part of the year and probably starts to moderate a little bit towards the back half of the year, but that's well after we get past the peak leasing season for 2021. As we pointed out, the supply picture, I think, improves as we get into 2022 and beyond, at least for a couple of years. I think probably by the time we get to 2024, 2025, it starts to accelerate again as a consequence of what we see happening with permitting today. The other factor that is at play here is that, we are still now carrying in the Q1 of this year, is going to reflect the full negative impact of the pricing performance that we had to do during the spring and summer leasing season of 2020, when it was at its weakest. All that's going to continue to roll through the portfolio, and it will peak, we believe, in the Q1. As we get into the spring and summer leasing season of 2021, where we do believe that the leasing environment will be much more positive and better, we will again, start to compound that improvement in terms of our revenue performance and it will build. It will build by the time we get into late 2021 and particularly as we get into 2022. Those two things, sort of supply pressure, but particularly sort of the compounding effect of lease-over-lease pricing and what it does to revenues, it takes time for that to work through the system. Yep. No, that's very helpful. You guys mentioned where you expect cap rates on dispositions this year for the assets that you have teed up. Where would you peg cap rates today, just kind of across your markets? I'm curious if you have a sense of maybe what type of growth buyers are underwriting and how far off you think you are on assets that you're bidding on. Austin, this is Brad. I would say, talking about cap rates across our markets, certainly as I mentioned, it's very aggressive on new assets for these Class A new assets in our markets that we're looking at. I would say from a growth aspect, it's hard to pinpoint what the other folks are certainly underwriting. I would say one of the things that's driving the difference in valuation really is leverage. Certainly, our leverage level is a lot different than high leverage buyers that are looking for 65%-80% leverage on some of these deals, and given where interest rates are. That's a big difference in the valuation of these assets. I'd say that's probably one of the levers that's having a biggest impact on our ability to be able to compete with those folks. That makes sense. Any sense where maybe the cap rate spread is versus long-term interest rates versus a couple of years ago? Has that tightened at all in your markets? I think it's certainly pretty low. I think if we're seeing interest rates right now in the 3%-3.5% range, it's probably come up a little bit in the last 30, 60 days or so. You're still seeing, again, cap rates in the low 3s or high 3s, low 4s. That spread is certainly low right now. We'll just have to see as interest rates move a little bit more and these LTVs change a little bit, how that filters through in pricing. We just don't know right now. There's so little assets coming to market that they're able to still find a buyer for most of these assets. As the supply of these properties pick up and come to market, we'll just have to see if there's an impact to pricing once that picks up and the supply-demand on investments here changes a bit. Got it. That's very helpful. Thank you. We'll go next to John Pawlowski with Green Street. Please go ahead. Thank you. Just one question from me. Tom, the last few quarters, the smaller markets have really outperformed your larger metros. Are you seeing the same notable in-migration trends in Alabama and Memphis, Greenville? Is this just more of a factor of more supply hitting the larger metros a little harder? We're seeing the increase in in-migration sort of everywhere, and you do have it in places like Greenville, but it's consistent and it's been the same thing that it has been before. Things like BMW and BASF and Michelin and those large international manufacturing conglomerates that are in those places. That is continuing. Obviously we're seeing strong results out of some of the larger markets that are like Phoenix and Raleigh. The spread of in-migration is fairly widespread. Even Huntsville is picking up some of it because of the NASA expansions there. John, I would add to what Tom's saying, is that, yeah, we do see the supply pressure more pronounced generally in the bigger markets. That historically has always been the case, which is why we've always intentionally embraced a good component or percentage of the portfolio to be invested in some of these secondary markets. We think that secondary market exposure does provide some downside protection to our performance profile against the pressures that often come from time to time from supply. Those secondary markets are doing exactly what we thought they would do during this phase of the cycle. Yeah. Sorry, John, I misheard a bit there. I'd also add in the supply as you expect and largely know on those large markets tends to be more urban inner loop and the suburban balance that we have has helped us there as well. Thank you very much. We'll take our final question from Buck Horne with Raymond James. Please go ahead. Yeah, thanks for keeping the call going along. I appreciate it. I'm going to ask one question. Single family rentals. Thinking about, you've seen a lot of home builders validate the concept, getting into purpose-built communities of single family rentals that can operate like horizontal apartments with an amenity. Maybe in more kind of outlying locations, but definitely Sun Belt. Does a concept like a purpose-built single family rental community potentially offer you anything attractive in terms of diversifying the product mix? How do you think about that concept going forward? Well, Buck, it is something that we've been talking about a bit. I do think that if you get a purpose-built single family rental community where you get, if you will, all the homes in a very organized, defined sort of community footprint along the lines of what you just described, kind of a horizontal multifamily plan, if you will, yeah, we think that there may be some logic to that. We’ve seen a few examples from time to time, right now, of course, that kind of opportunity is attracting a ton of capital, pricing is pretty competitive. Should the opportunity present itself for something that along the lines of what you’re describing, it would be something we would take a hard look at for sure. All right, great. Thanks. Congrats, guys, appreciate it. Thanks, Buck. Thanks, Buck. Okay, no further questions. I'll return the call to MAA. Is there any closing remarks? No further comments. Appreciate everyone joining us this morning and let us know if you have any additional questions. Thanks. And this concludes today's program. 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