Thank you for joining our next roundtable session with Mid-America Apartment Communities. Looking forward to hearing more about MAA, strategic plans and positioning in Sunbelt markets. It's been a hot topic. I think you guys had very strong demand. If there's any insights from some of the meetings you've had, we could talk about that as well. I just want to introduce the company. Straight to my left, Clay Holder, Executive Vice President and CFO. To his left, Brad Hill, President and CEO. Then to his left, Andrew Schaeffer, Senior Vice President, Treasurer and Director of Capital Markets. Same as the other roundtables, we want to make this as interactive as possible. I know it's day two afternoon, but I know everyone's had a lot of good questions incoming on MAA and at the conference. Please participate. I will first turn it over to Brad to introduce the company just in case there are some people in the room that maybe aren't as familiar with MAA, your strategic plans, maybe a little bit. I think you did put out an operating update. Let's go through that and then we could get into Q&A. Thank you. Yeah. Thanks, Jeff. I appreciate the opportunity to be here. As Jeff said, I'll give a brief update of who we are as a company, what our focus is, and certainly go through the update a little bit here. You know, MAA is an S&P 500 multifamily-focused REIT. We have a 30-plus-year history as a public company. We do have a unique focus, as Jeff said, of focusing our capital on the highest demand region of the country. That overlaps generally with the Sunbelt, as well as some of the southwestern markets in the U.S., where we've seen, as Jeff said, some tremendously high absorption in demand over the last year or so. Certainly, as most are aware, with that region of the country, we've experienced a very high level of supply over the last couple of years. Last year in particular, we peaked with a 50-year high level of supply delivering into our markets. At this point, we're certainly past that peak and new deliveries are rapidly declining. There's some third-party data that is out there that certainly shows fourth-quarter deliveries across the country are dropping materially from third quarter down well over 50%. We certainly see that and expect to continue to see that decline as we get into next year. As we talked about, demand in our region is very strong. If you look at the trailing 12-month absorption numbers that we see in our markets, it's the highest absorption that we've seen in the last 25 years. Demand is really robust. Really what that's leading to is stabilizing and strengthening market-level occupancies really across the board. If you look at the average occupancy in our markets today, you know, kind of weighted average for our portfolio, we're only 30 basis points below where we were pre-COVID. Occupancies have really stabilized and that's up about 190 basis points year over year. All of that absorption that we've seen coming into the market has really absorbed a lot of this new supply that's been being delivered. Those occupancy levels are really stabilizing. I think that's a really good place for us to be in our markets today. We did put out an update in the packet. Certainly, not a lot has changed over the past 30 days since we had an earnings call. As we sit here today, demand is robust both broadly in the market as well as in our portfolio. We're seeing good traffic trends. Our exposure is below where it was this time last year. I think that's reflective of that strong demand that we continue to see. As we mentioned in our packet, our occupancy trends are slightly higher than what we expected here in the third quarter. Renewal strength continues to be strong. We continue to see out through October very strong renewals, high retention rates. We're not seeing any change in move-out behavior really supporting our renewals that we continue to get. As we mentioned in the packet, our new lease rates continue to remain under pressure, particularly in some of our higher supplied markets. Austin for sure has been a high supplied market for us where new lease rates have been most pressured. Phoenix, Nashville, and then Jacksonville, we're seeing also a lot of supply in those markets, which is impacting new lease rate performance versus our expectations. The good news is in all of those high supplied markets, really we're seeing the benefit of occupancy stabilizing. All of those markets we've been fighting, not just the new lease rates over the last year, year and a half, but we've also been struggling in pushing really hard to try to stabilize occupancy in those markets. Today, all four of those markets have occupancies that are at or above our portfolio average. We do believe that puts us in a pretty good spot to continue to be able to push on the new lease rates. The other thing I'd mention is it's also important to remember that our renewal rates and our new lease rates are better than they were this time last year. We do continue to see improvements in our markets. I do think that's reflective of the strong demand that we continue to see, coupled with supply that continues to decline and that we expect to continue to decline from here. Things are unfolding in line with our expectations. We feel like our forecast for the back half of the year from an earnings perspective is pretty good and we're in a good spot for that as we sit here today. We're looking forward to certainly what the trajectory of that looks like over the coming years. Thank you. Great. Let's first dive into the demand side, given that's clearly been a concern. With the revised job numbers, it's a little bit more heightened right now. We did meet with one of your peers earlier who had a very optimistic view on that downward job revision. What are your thoughts? Again, tied into maybe some of your comments on the most recent trends you're seeing. Yeah. As I mentioned earlier, absorption, despite what the actual job numbers showed, has been very strong. If you look at the gap between the trailing 12-month absorption and supply, that gap is at a level that is approaching the COVID level. We are over-absorbing the supply that's coming into the market. As I mentioned earlier with the occupancy numbers, we're not, you know, as new supply comes into the market, we're not creating a situation where we have a lot of unoccupied units that we have to fill. Those are all being occupied, which I think really sets the market up quite well for the recovery as we get into next year. I think it's also important to remember that there's multiple components of demand. Job growth clearly is a big component of demand, but you also have migration trends. You've got population growth and you also have the single-family affordability concerns that we have in our region of the country. Migration trends have been strong. They continue to run strong. They're about a + 7%, net 7%, meaning 7% more people coming into our region and moving into our communities than moving out. That is in line with pre-COVID levels. It's down from the peak of COVID where it was 10% or 11%, but it is in line with pre-COVID levels. Still continue to see good trends there. Population growth in our region of the country continues to be really strong. We continue to see high population growth transferring again to the Sunbelt region. The single-family affordability, I think, is a relatively newer phenomenon to the Sunbelt. If you certainly look at the coastal regions of the country, New York, California, it's always been unaffordable to own a home and buy a home. That is a phenomenon that has really picked up speed in the last five years or so within the Sunbelt region. If you look at just the average median price of a home over the last five years in the Sunbelt, it's up over 50%. The mortgage payment cost to own a home is up over 100% over the last five years, while our rents are only up about 30%. The relative unaffordability of the single-family market has really grown more of a headwind for folks wanting to buy a home in the Sunbelt. I don't think that that's something that's going to change anytime soon. Our retention rates are up 10 basis points or 10 percentage points over the last 10 years. Part of that certainly is associated with the single-family market. Part of that is our focus on customer service, where we're really focused on retaining customers. Given where that affordability component is, we're not seeing any indication from our demographics or from the demands of our residents that they're really out looking to buy a home. They just can't afford it. We're not seeing that. We're seeing it's a lifestyle choice for them to live in an apartment community. They want the low-maintenance lifestyle. We continue to see those factors in our portfolio. Thank you. I know you're in a unique position that you're, as you mentioned, in the Sunbelt. You've had great migration and better job growth than other parts of the country. These latest job numbers, these downward revisions, just kind of the concern over employment in the coming months. I moderated our economist yesterday, and Bank of America's call is to muddle through a decent job market. I guess from your seat, are you any more concerned? Or, based on some of these recent trends you talked about, good traffic, renewal strength, you mentioned still the word recovery in 2026. Yeah. Just to confirm, you're still feeling good? Yeah, no, still feeling good about that. I think as we look at 2026, we're more optimistic about what the job growth outlook could look like for next year. Certainly, the uncertainty around the tariffs that I think really slowed down new lease progress as we got into May, past Liberation Day, we saw new lease rate growth that was really progressing quite well month over month into April, really kind of stall out after that point. I think today the tariff uncertainty is decreasing. We have the tax bill is now behind us. We seem to be moving closer to a point where the Federal Reserve is going to lower interest rates. We think that all of that certainly should spur economic growth as we get into next year. From a corporation standpoint, I think it relieves a little bit of the uncertainty that we saw this year that maybe caused many to hesitate in terms of outlaying capital, making hiring decisions. We think that outlook looks a little better next year. Thank you. In fact, our economist talked about in 2026, one of the things maybe people are underestimating is some of the tax benefits from the bill that passed. To the consumer, actually seeing more income than people expect could be another positive. Let's just dive in again to the word recovery. I think on the call you talked about momentum into 2026. I know, again, focusing a lot on demand here, but that's been a key incoming question that we've received. I assume a big topic in your meetings as well. Could you just talk about, again, the fact, you know, it's now September and you're still comfortable using the words recovery, momentum. This leasing season has been a little bit different than some in the past. Again, what gives you that comfort to say, you know, are you still seeing that momentum? Yeah, I mean, I think we are. Our forecast for the back half of the year certainly expected new lease seasonality to be less of a deceleration going into the third and fourth quarter than we've seen in previous years. We still expect that to be the case. As I mentioned in my opening comments, both renewal and new lease rates are better than they were this time last year. Certainly, as we continue to see the supply picture improve rapidly over the last quarter of this year and going into next year, we would expect to see better performance than what we saw last year. If you think about it just from an earn-in perspective, coming into this year, we had a negative 40 basis points earn-in coming into the year. Based on our forecast, we would expect our earn-in going into next year to be somewhere in the 20 to 30 basis points range. That's a 60 to 70 basis point swing versus where we were last year. We do believe the momentum is shifting. The supply outlook as we get into next year is 30 to 40% below what we had in deliveries this year. Yes, demand is a big part of the equation for us. We do think demand and demand drivers, that's why we allocate capital based on demand. We think that's the factor that has the most correlation with long-term performance. We think the demand is going to be strong. On top of that, we have a 30 to 40% decline in supply next year, which will take the deliveries in our markets below long-term averages. We're in an environment where we think the demand outlook is better than long-term average and the supply is getting below long-term average. That speaks pretty well for our ability to generate improving performance as we go throughout next year. Thank you. I think you just answered, but just to clarify, the down 30 to 40%, that's your specific markets? Correct. Do you measure, you know, not only within your markets, but competition near your assets? We do. I mean, certainly when new supply comes in, we're monitoring that new supply. One of the things that the new supply does in our markets, while it can moderate performance to some degree, a couple of things it helps support. One is our repositioning and our redevelopment initiatives. The average supply that's coming into the market is on average $360 a unit higher in rent than our units that we have that compete with that. What that does is it really supports our ability to come in and renovate our units, raise the rents $100, $150, whatever it may be, and still come in lower than that new supply. Our units are practically brand new units for our communities. What we find is that initiative for us performs quite well as the new supply coming in begins to stabilize. That's an initiative that we're doing about 6,000 units or so this year. We've been as high as 8,000 units. We'll continue to monitor the market. As that new supply comes in and stabilizes, it'll be an opportunity for us to expand that. The other opportunity for us based on the new supply coming into the market is it provides acquisition opportunities for us. As those opportunities maybe do not achieve the rents or the performance that some developers expected, maybe the developers are not operators and they're not able to achieve what they expected, we're able to come in and use our balance sheet capacity and be able to execute on some of these acquisitions. We've done that considerably in the past. After the GFC over a three-year period, we bought 10,000 units. We'll be pretty opportunistic on the acquisition side if we're able to find some pretty compelling opportunities. Thank you. Please. Just looking at the unstable loan that's buyouts, do you expect that if you continue to see more of rates climb potentially out in value? Say Say maybe you don't go all the way back to like your normalized levels. Yeah. Maybe you could end up somewhere in between 10% and 20%. Yeah. That's a good question. I do think, you know, we have seen, if you look at that chart, it's on slide 16 for those of you looking at it, we have seen our turnover. We were seeing that decrease prior to, you know, certainly prior to COVID and prior to where we are today. That trend had already started. What I would say is, you know, when we started this year, we were at 43%, 42% turnover. We expected that to start ticking up a little bit. It continued to decline down from here. If you look at the 2022 period, we were at 45% turnover. My sense is that if we did see the housing market really pick up, mortgage rates would have to decline meaningfully. You could see a couple of percentage points change in that retention rate and move out to buy a home. Again, just keep in mind that our demographic generally is not a demographic that's looking to do that. 80% of our residents are single. The average incomes are $90,000- $95,000. What we have found is the reason why people generally are renting with us is because they want a low-maintenance lifestyle. That really contradicts owning a home. Could there be, again, a couple of percentage they want to move out to buy a home because it becomes more affordable? There could be, but we don't see a massive shift in those percentages to do that. In terms of the supply, just to clarify, I think we're seeing new supply down 30%- 40%. In In 2026, in terms of supply pressure, because I think the new supply that's come online in 2025 is getting leased up a little bit slower than expected. Do you expect the supply pressure to be down 30%- 40% in 2026, or the supply pressure may be, again, it's still helpful, down more like 5%- 10%? The bigger benefit is 2027? No, I don't think that. I think that the pressure will decrease similarly with the amount of supply that's coming onto the market next year. Again, because if you think about market-level occupancies, we're kind of in a stable mode at the moment, being 30 basis points below where we were pre-COVID. The market focused on occupancy earlier this year. That's really what we saw after the Liberation Day. The market was really focused on getting occupancy given the uncertain environment. Back to my original point, we saw occupancies in the market increase almost 200 basis points versus where we were in August of last year. I think as the supply is coming to market, and we already, based on the numbers, see that fourth quarter deliveries are down 50%, the market is absorbing the supply as it comes in. I don't think there's going to be an overhang of unabsorbed new deliveries that come into the market. Certainly, there could be a little bit as, if it's delivered in December or January because that's a slower traffic month. I think from a structural standpoint, I don't see an overhang from some of that supply coming into the market. Please. Yeah, I mean, the concession behavior that we're seeing today hasn't really changed. There hadn't been a change in behavior of that. It's been pretty consistent, and that's in those high supply markets. We still see two to three months free in the pockets where there's a lot of supply. For us, concession, we're a net price shop, so concessions are pretty small. They're about 60 basis points of our revenue. We haven't seen a lot of change in that behavior. Two years ago, we saw a big change in the concession behavior as we, at that point, as the supply wave was coming at us. Now where we sit here today and we see that the supply is declining materially next year, I think the motivations from a merchant developer perspective to offer those concessions is a little different than it was a couple of years ago. We're not really seeing that right now. To finalize the topic on supply, what are your thoughts on 2027 and beyond? I'll share what I heard previously from one of your peers. Okay. Yeah, I mean, our view on 2027 supply is, you could basically see what that is today. If you go back and you look at the trailing 12-month starts, normally it takes about two years for those starts to manifest into deliveries. The trailing 12-month starts that we're seeing are about 1.7% of inventory. I think as you get into 2027, you're seeing about a half of a long-term average in terms of deliveries coming into our market. To put that in perspective, to go back and look at a time where we saw starts that low, you would have to go back to after the GFC. It's around 2011 or so, we started a cycle given the restriction on the financing side where starts were low for a number of quarters. If you look around that time, we had a four to five-year period of time where NOIs grew 5%- 6%. We're not seeing anything on the horizon from the developers we talk to. We've got partnerships through our pre-purchase development platform with a lot of the largest developers in the country. We're not hearing from them that they have a number of projects that they're ready to start. We're not hearing anything from our partners and anything in the market that indicates to us that the pipeline is going to ramp up from here. How far out are you willing to say we'll see this decrease in supply? It sounds like definitely at least through 2027. How long do you think that will last? I think it's, you know, we're kind of range-bound, I think, for the next year or so in terms of starts kind of in this level. You know, call it 1%- 2%. Again, long-term average is 3.5%. I think it's important to recognize that in the Sunbelt, I think folks think that you can find a piece of property and be under construction within three months, six months. That's just not the case. It takes a good 12-1 5 months when you find a piece of property to when you're able to put a shovel in the ground. Back to my previous comment, we're not seeing these developers sitting on, you know, permitted deals. They're not pursuing a lot of deals. It seems like there's going to be a good, you know, year to a year and a half before we see a ramp up in that pipeline at all. When I say ramp up, I'm certainly not saying that we're going to ramp up to where we were two years ago at 6%, where that was a result of almost free money. The pipeline naturally will increase. I think you've got some runway for that. One of your peers said he wouldn't expect supply to really return until maybe 2030, nothing like you said, just given how long it now takes to get entitlements and the process. Okay. If you go back to that 2011 period where you look at the starts in our region of the country, you'll see there's a, it's a couple-year period, maybe three years of very low starts to that point where it does take time to ramp up the pipeline. This is the first time in the cycle since 2010 where we have seen some of the development shops let go some of their development partners. We haven't seen that in the past. I think as that happens, certainly the ability for some of these shops to ramp up production is diminished. We've been worried about the U.S. consumer for three plus years. You know, we continue to talk about the resiliency. New renters, you know, you've talked about, you know, they're more price sensitive. Are you seeing anything new and different as we've entered September that they're truly price sensitive, meaning there's an issue and/or is it because of all that supply, they're shopping around, they're seeing the concessions? How would you characterize what's happening with the new renter? We're only nine, ten days into September, so it's hard to draw hard conclusions from September. We're not seeing a difference in any of our forward-looking trends in terms of traffic patterns, behaviors from a customer, resident, or prospect perspective. I don't think there's any changes immediately on that topic. One of the things we look at is our rent-to-income ratios, and that's on our new residents. If you look at that, it continues to decline. Today, our rent-to-income ratios are at 20%. Our incomes continue to increase, and that rent-to-income ratio compares with, three years ago, it was at 23%. I think our rents are more affordable today than they have been. Our residents are stronger than they have been. If you look at our collections, it continues to be really strong, and we're not having any issues in that category. We're not seeing anything that indicates to us that our residents' finances are struggling in any way. Great. Most recently, nothing, as you mentioned, late payments bumping up, none of the signposts you would typically see. Again, Bank of America's view is muddle through. You know, talk of recession has come up again. You're not seeing any of the typical signposts you would see ahead of, let's say, if there were real issues. No, we're not seeing anything. Okay. Let's talk about, let's get a little bit deeper into some of the markets. I know we talked in generalities around the portfolio. I guess, can you talk about maybe strongest to weakest as we enter the fall here in 2026? Yeah, I'll jump in there, Jeff. I think when you think about strongest markets that we're seeing right now and as we go into next year, we've talked a lot about the Northern Virginia markets that we're in and we're continuing to see some good performance in those markets. They've been rather resilient throughout this period of high supply and partially have been somewhat insulated from it. Nonetheless, they have been performing very well across the board. We're also seeing that strength almost down kind of our eastern coastal markets, especially in our mid-tier markets. I'm thinking of the Charlestons, the Savannahs of the world, the Richmonds, Greenville, South Carolina. Those markets, similar to the Northern Virginia, have just been very resilient. They've been protected a little bit from the supply, maybe not Charleston, but some of these other markets definitely have been protected a little bit by supply versus what we've seen in some of the larger tier markets in our portfolio. When you kind of come down the ladder there, come down the scale, markets like Atlanta, Dallas, Tampa, we're seeing some good recovery in those markets at this point. Last year they may have been on the lower part of the list, maybe not down to the Austin level, but still in the lower part of the list. They're moving back towards the middle of the portfolio average. Excited to see some of those types of markets where we have a larger footprint beginning to show some real signs of recovery there. Brad mentioned occupancy earlier in his opening remarks. That's kind of where we're seeing it first in those markets and then expecting pricing power to come back as those markets stabilize. When you think about kind of the lower end of those markets, of where the performance is, the Austins, the Nashville, the Phoenix, Jacksonville, those are probably the four, I'd say, of our worst performing markets. All of those have a little bit of a different perspective on them. It's all supply driven, but how the supply is impacting them is all dependent on the market. Austin, for example, the supply is everywhere. We're still feeling a lot of that pressure, even today. Just over the past three years, the incentive inventory of deliveries is 30%. Just a ton of units that they're having to devour. The good news is, we are seeing occupancy in Austin move similar to what we're talking about in Dallas and Atlanta, move back closer to that average of the portfolio. We should begin to start seeing some pricing power there. Phoenix and Nashville are both seeing a lot of supply, and those are going to continue on just for a little bit longer. The demand dynamics that we see in those markets are very, very strong, and we expect those to kind of be on the back end of the recovery, but still recovering and being a good performer for us. Any comments on urban versus suburban or A versus B? Yeah, from our urban versus suburban, those are pretty tight with one another. Those are a little bit spread from one another. The suburbs are probably outperforming urbans by about 50 basis points on both a pricing and occupancy standpoint. The A's versus B's, those are much tighter. We're just seeing about a 10 basis points difference in both occupancy and pricing across the portfolio. Please. Thank you. What do you need to see? We've been hearing a lot of optimism on this big data set of the net to fund is balance, affordability base, not there for balance. What will it take for C to start to more of a churn? What are you concerned with today in terms of, I think, the balance sheet, revenue portfolio, the proprietary, what should we be thinking about? Yeah, I mean, I think first and foremost is the performance of our existing portfolio. I mean, that's concern number one or focus number one, not concern. I think what we're watching there, mostly first and foremost is the performance of our renewals. You know, renewals, when we're retaining 60% of our residents, we've got a lot of focus in that area. A lot of what we're doing on the customer service side is really focused on taking care of those residents so that they will continue to renew with us. How we do work orders, how we do various customer service and touchpoints is really focused on that. We monitor our Google scores, which today are the highest in the space because we believe that if we're able to provide good service, that's going to lead to renewal. That's number one. We're really focused on that area of the business. I think number two, we've got to really focus on the new lease side. You know, what's happening? Are we getting traction with, you know, new lease folks traffic-wise? Are they converting? Is there everything in our ecosystem? Is it really helping get that prospect into our system and to leasing with us and at what rates? That's really what we're focusing on from a first priority perspective. I think second to that, we continue to focus on building our future earnings growth through development. You know, we've got a big focus on the development capability. We've put a lot of effort into that area. We've grown from about $450 million over the last couple of years in our pipeline to today, we're just under $1 billion. We believe today the developments that we're starting and that we started last year are set to deliver stabilized yields in the mid-6%. Given where cap rates are, still sub-5%, that's an area where we want to continue to allocate capital as aggressively as we can. Recognizing when these assets deliver in 2026 and 2027 and 2028, like we were just talking about, where the supply picture is going to look a lot better. We're not trending rents like we expect rents to perform over that period of time. Those will be some pretty strong performers for us and earnings contributors for us. That's generally what we're focused on. The balance sheet is in a great, great place at this point. Low leverage at the moment at 4x and anything that we fund on the development acquisition side will be through debt. We'll maintain our capacity to really help us grow and lever up as we do that. Maybe just one quick question. We do have three rapid fire on risk. I think this time of the year, your tax assessments come through. Anything to note on that or any insurance? Yeah, yeah. In our second quarter update or our earnings release, we updated kind of where we are on property taxes for the year and essentially expect those to be flat year over year. We've got the majority, well over the majority of our valuations at this point in the year and have seen some really good results from that standpoint. We expect that to actually carry through into next year. I'm not necessarily saying that we're going to see roughly flat growth in property taxes, but just given where operating performance has been over the past couple of years and the backward looking perspective that that brings, we should still see some, you know, nothing like we saw probably two, three years ago when you saw really some outsized growth in property taxes. Okay, great. Thank you. Rapid fire, just choose one. When the Federal Reserve starts to cut, do you expect borrowing rates for long-term debt to decline, stay flat, or potentially rise? Choose one. Treasurer. That's a great question. Sure, long-term debt. Stays flat. Flat, stays flat. Okay. Number two, last year the majority of companies stated they're ramping up spending on AI initiatives. How would you characterize your plans over this next year? Higher, flat, or lower? Higher. Last, and this is for the industry, do you believe same-store net operating income for the industry will be higher, lower, or same next year? Higher. Thank you. Fantastic. Thank you so much.