Afternoon. Welcome to Bank of America's 2026 Global Real Estate Conference. I'm Jana Galan, BofA's residential REIT analyst, and we're thrilled to have with us MAA's President and CEO, Brad Hill, CFO, Clay Holder, and Treasurer, Andrew Schaeffer. I'll turn it over to Brad for opening remarks, and then we can jump into Q&A. Yeah. Well, thank you. Appreciate everyone being here, appreciate the time. It's been a great conference. We enjoy the building. It's been well-received. What I thought I'd do is just give a few opening comments and just jump right into questions. For those of you who aren't as familiar with MAA and our story, just a quick update or background. MAA is a $22 billion S&P 500 multifamily REIT. We have about 105,000 apartment units, predominantly across the Sun Belt region of the U.S. We are located in 16 different states, and our exclusive focus really is on multifamily in what we call high growth, high demand region of the country. Generally, that overlaps quite well with the Sun Belt markets throughout the Southeast. If you look at our markets, what's characterized them historically has been significant outperformance on demand metrics. Whether you're looking at household formation, population growth, migration trends, job growth, wage growth, our markets have consistently outperformed other regions of the country on all of those demand factors, and that continues to be the case today. Certainly, our markets, particularly if you look at the last three years, has faced more supply pressure than other parts of the country, as we've seen really a record level of deliveries in the Sun Belt region, really across the country, but in particular in the Sun Belt region. But as we sit here today, that supply pressure is moderating. So we're really encouraged by what we're seeing there. We continue to work our way through that supply overhang. Definitely our new lease rate performance continues to be impacted by that new supply that's coming into the market or is into the market, but a lot of those lease-up communities are leasing up, and so we are seeing some better performance. Finally, after three years of excess supply, we are seeing those new deliveries trend down below long-term averages. Based on what we've seen in terms of new deliveries for the last three years being below long-term averages or new starts for the last three years being below long-term averages, we do expect the trajectory of supply to be more muted as we go forward for the next three to five years. If we look at our markets from a market perspective, certainly some of our high supply markets, as I mentioned, are still under pressure. If you think Phoenix, Jacksonville, Charlotte, Raleigh, Nashville, Austin, those markets continue to face supply pressure, but we are making our way through that. I will hit on one of those markets here in just a second. We are also encouraged by some strength that we are seeing in our mid-tier markets. If you were to rank all of our markets from top to bottom in terms of performance, you will see the top 10 or so of our markets are all mid-tier markets, and those are markets where we have seen less supply pressure or those markets peaked in supply pressure before other markets did. We are seeing pretty good performance out of those markets. Then if you look below the line in terms of our average performance, what you will see is all of those markets are high supply markets. We continue to see pressure in those. But the good news is, if you look at a high supply market like in Austin, even though that market has seen the highest supply in the country, we do continue to see good performance, relative performance out of that market. Now, if you look at our blended performance just over the past year, we are up about 300 basis pointst- 500 basis points in blended performance year-over-year. So while it is still negative and it is still at the bottom of our list, we are seeing some stronger performance in that market. Again, as the supply pressures continue to be absorbed and dissipate across our portfolio, we would expect to see similar performance in terms of trends across our portfolios. Thank you. Ahead of the conference, you guys provided a bit of an operating update. I know you touched on some parts of it. Yeah. But maybe if you want to go through a little bit more on how the third quarter is trending. Yep. Absolutely. We did put out on page 33, if you have a package in front of you. I'd say in general what we're seeing so far in the third quarter, consistent with our comments on the earnings call. We are seeing and expect to continue to see less of a seasonal slowdown in the third and fourth quarter than what we saw last year. If you look at our blended results quarter- to- date in third quarter, we're seeing that at this point. Tying back to my comments I made a moment ago with us still dealing with supply pressure in some of these high supply markets. Our new lease rate performance is probably a little weaker than what we had hoped in the third quarter, but we are seeing some strength on the renewal side. If you look at our renewal rates, the third quarter is consistent with what we saw in the second quarter. It's also up about 70 basis points year- over- year, and our retention rates continue to improve. If you look out into the fourth quarter, as we sit here today, we have over 60% of our renewal decisions have already been made. And we continue to see improvement in the retention rates, and the renewal rates are improving. We're up to about 5.5% in the fourth quarter, which again is about 70 basis points or 80 basis points better than last year. So continued strength on the renewal side. The other thing I'll mention about third quarter performance, we have seen a build in occupancy every month through the quarter. So August occupancy was better than July and September occupancy. Average daily occupancy will be better than what we saw in August. We've continued to build occupancy as we've gone through the quarter. That's great. Very strong renewal rates. Like I said, it is very surprising, kind of the difference when you look at the numbers. But can you help us think about it maybe in terms of what those actual dollars are between the- Yeah. ...- 5.7 and the +5 and- The spread between on a new and a renewal lease on a dollar amount is about $180. So that spread in a dollar value is not quite as big as you would think. If you think about that from the position of a renewing resident, what we are asking them to do is to pay about $90 more than what they are currently paying. From a resident perspective, we do a lot of focus on customer service. What we have found is if we continue to take care of that resident, provide good maintenance, a good experience for them, and really not give them a reason to leave, then they generally will not leave from us. That $90 rent increase that we are asking them to give is about $1,000 a year, so it is very reasonable. What we have found is if we do that, folks will stay with us. That is, I think, more so than single-family affordability concerns. I think that is why we have seen our retention rate continue to decline. Just as we have kind of towards the tail end of this peak leasing season, just curious if you can kind of comment on what were the best markets and then which markets are seeing potentially the best momentum, which could potentially be the leaders in 2027. Yeah, I think for the best markets, it goes back to Brad's earlier comments of some of these mid-tier markets. They continue to show strength through the third quarter, coming out of the second quarter and into the third quarter. Again, it goes back to the function of the supply discussion that he was just bringing up. I think when you think about some of the markets that we're seeing some good momentum, even as we come out of the summer leasing season, Orlando comes to mind. Orlando, we've seen some really good strength in its performance over the course of the summer months. That was one that has dealt with supply, has seen a lot of it over the past couple of years, and it's beginning to kind of turn that corner there. Dallas is another one that we've seen some good momentum. We've been talking about Dallas for a little over a year now, probably, and it continues to show some strength even year-over-year at this point. That's again, less in supply and then really good demand in that particular market. The last one I'll point to is Austin, and Brad talked a little bit about that. You think about Austin, it got supply everywhere in that particular market. We're starting to see different parts of Austin get some relief from the supply pressures that it's been seeing. In those parts of Austin where we're getting that relief, you're really seeing that benefit and that strength starting to show itself in its blended rate trends. As the rest of that market gets past the supply wave that it's been experiencing, and it's been experiencing a supply wave that's probably exceeded all other markets. I think the benefit and the growth that we'll see in that market will continue to build on what we've seen today. Maybe can you talk about the concession usage you've seen in your markets and how that's ranged? Yeah. I think in general, concession usage is pretty consistent right now to what we have been seeing. We are not seeing a material change in that really one way or another. We saw an uptick in concessions probably two years ago ahead of the supply wave. We have not seen that materially pick up. As we sit here today, we have in our markets about 200,000 less units in lease-up than we did two years ago. The number of communities that are out there in lease-up continues to decline. While I think the concession usage in a lease-up community is consistent, call it six to eight weeks. The prevalence of that as the number of lease-ups decreases, the prevalence of those concessions is decreasing in the markets. Can you quantify your asset exposure to that percent of where there is a decrease in lease-up properties? Do you have a breakdown? Yeah. I do not have that. I think it is going to vary by market. Honestly, to Clay's point, if you think about a market like in Austin, first of all, the supply has been everywhere. But I would say we have not been as exposed to some of the supply as we have in other markets. Charlotte, for example. We are seeing a little bit more pressure right now from some of that supply that is in the market. I think we are more exposed to it in a market like that. But it varies greatly by sub-market product type in markets. It is hard to pinpoint what that percentage is across the board. Then maybe on the demand side, what are you seeing in terms of migration, job growth, and household formation trends? Yeah. I would say across all of our markets, all of the demand fundamentals continue to hold up quite well. I mentioned on the earnings call, one of the things that we saw an uptick in the second quarter that we needed to keep an eye on, which I think is a positive, was migration. We saw the slope of the quarterly change in the second quarter of in-migration was stronger than what we had seen in any other quarter. One quarter doesn't make a trend, so we've got to certainly keep an eye on that. That was also broad based. It wasn't coming from one market versus another. It was pretty much all over. We saw even some migration coming from Midwestern markets, which you haven't seen a lot of that historically. We started to see some of that. Migration continues to be pretty strong for us. I'd say all of the other metrics of demand that we're tracking, there's not really a weakness in any of those. In terms of markets, the one market I would say that we're watching from a demand perspective is Denver. Again, across our markets, I think we've got strong demand, but Denver's probably been on the weaker side of the demand fundamentals than any other market that we have. The migration into Denver has been a bit slower. The job growth's been a bit slower there. I think the good news for Denver is the supply picture is coming down considerably. So I do think the supply-demand balance should be okay for the next couple of years as that supply continues to come down. But we're pretty excited about the demand fundamentals across our footprint. Maybe just some comments on Atlanta being one of your largest markets. Yeah. Yeah, Atlanta, kind of going back to the discussion I had with Dallas a few minutes ago. Atlanta and Dallas both started kind of moving in a very positive direction about this time last year, and that momentum continued through probably the first half of the year. It's maybe slowed down a little bit versus what Dallas is continuing to show that momentum. But I think we're still seeing overall good fundamentals, overall, generally good demand in that particular market. The supply impact is kind of over and done with there. Now I think it'll be more of a typical market for us as probably pre-COVID levels of just kind of some general growth, but not going to be the leader of the pack at the same time. Thank you. Maybe changing topics a little bit. Thinking about just this past year in terms of the public REIT apartment space, there has been a lot of consolidations. Historically, you guys have been some very large consolidators. Yeah. Just curious your thoughts on scale, platform. Yeah. Yeah, we have been very active in that space, and I think if you look back at the mergers that we had with both Colonial and Post, it was about a strategic advantage that we could use to get stronger in some way to ultimately deliver long-term TSR performance for capital that was strong and growing. Colonial was more about scale. We got more in the same markets where we are. Post was, we got development capability. We got a stronger balance sheet. So there were specific capabilities we got with those. As we sit here today, we are 105,000 units. From a cost structure standpoint, I think we have some of the best cost discipline in the space. If you look at our maintenance costs per unit versus the space, we are probably better than most in the sector. Our growth rates are well controlled. Our G&A as a percent of revenue, the lowest in the space. From a scale benefit perspective, I think we have harvested quite a bit out of that. From a data capability, we do have 170,000 residents in our community that we are collecting transactional data from that we can analyze and look at. So I feel like we have pretty good scale in that area. Probably an area of continued scalability for us, we are doing it on our portfolio now, is the podding, where we have overlap in terms of where certain properties are located between other properties, and we manage those properties. Instead of two managers, there is one property manager for both properties, so we have some more opportunities to do that. So for us, it is about how can we drive long-term differentiation and growth to our shareholders in a way that is sustainable. If we find opportunities to do that, we'll certainly entertain those ideas as they come along. For us, it's about continuing to focus on the operations side of the business. As we strengthen what we're doing in that area, we'll find opportunities to put our platform on more properties to drive additional benefit to shareholders. Maybe can you talk a little bit more on just some technological initiatives, how you're using some of the data you've collected to either kind of drive other revenue or you've highlighted some of the- Yeah, absolutely. The focus that we have, we term as ReiMAAgine. That's really what we're doing is we're rethinking how we staff properties, how we're structured operationally. We're redesigning what we're doing on-site to really drive higher customer service. Customer service has been a focus of ours. It ties back to our strategy of maximizing the renewal transaction that we have on-site. If you go back and look at our performance over the last four years, you'll see that our renewal performance is 5.25% for the last four years. So we significantly outperform in that area. Also has cost implications to it as well. So we're really focused on that piece of the business. Certainly, technology is a part of that. Process workflows is a part of that. We're looking to take all of the administrative tasks off of the site that we can to allow them to focus on customer service. That gives us an ability to further scale what we're able to do, the number of people that we have, and the number of units per head count, if you will, across the organization has continued to improve. So AI is a part of that. Process workflows is a part of that. Staffing certainly is a part of that. We've used AI for the last probably two years on prospect engagement. We continue to use it in that way, where today upwards of 75%, 80% of our interactions with prospects are now through a chatbot or a voice bot or something of that nature, which frees up our staff to be able to really focus on customer service type items, which I think is really driving some of our customer service scores in the space. It is a big focus for us. We are probably in the pretty early innings of using AI for some of our back-office staffing and improvement and scalability items from a back-office support perspective. Maintenance side is also another area that we are working early on in terms of considering some of the technology and how that could apply there as well. Maybe turning over to the capital markets transaction activity. What you guys are seeing in terms of product on the market, and you have been active, both buyers, sellers, and developers. Yeah. Where do you see the best opportunities? Yeah. Certainly where we have seen the best opportunities the last couple of years has been in development. We have obviously tried to grow our development pipeline. A couple of years ago, we were around $300 million- $400 million. Today, we are around $800 million or so, with a goal of keeping that around $1 billion. We do think that in terms of driving long-term TSR performance, development is the way to do that. We are getting accretive yields and higher NOI growth rates than what we are getting out of our existing portfolio. It is a great growth opportunity for us. We have not been as active on the acquisition side, just given where cap rates have been. They have generally been in the, call it, 4.5% range, which is obviously lower than where our cost of capital has been, and so we have not been very active in that space. We've sold a few deals this year, about $150 million. We've taken that capital, given what's going on in the acquisition market, and we have redeployed that into share repurchases. That's been the use of that capital. We still believe that development is a great place for us to be in this environment. Certainly, our cost of capital has changed. I would expect that the hurdles needed to move forward with developments will change as well. We'll continue to focus our capital in the best avenues that we have. Other areas where we're focused, it's smaller scale, but great returns is our unit repositioning and redevelopment. We continue to ramp up that focus. We're up about 30% in the number of units that we're doing this year. That program continues to benefit as the new supply in the market gets stabilized. We're seeing 20% cash on cash returns from that. Our property-wide Wi-Fi, we're ramping up investment in that area of the business. That's about a $45 million NOI opportunity over the next, call it, five years or so. We continue to ramp up in that area as well. Then just back to the development side, can you talk a little bit about kind of construction costs and how you're- Yeah. ...monitoring and managing them? Yeah. Certainly, there's been a lot of unknowns over the last year or so. We've seen costs come down about 5%, I'd say, over the last year, and that's really been on the margin side. Haven't seen much change in terms of materials. We've also been cognizant of the risk associated with oil prices and how that could maybe impact some of the materials. So we've increased contingencies in our deals to try to protect us if something does happen, costs go up in terms of that area. But we haven't seen that to date. I think as we sit here today, it's hard to see that construction costs would continue to come down going forward, because you can only reduce margins so much. But I feel like we've gotten a little bit of benefit over the last year in terms of reduction. Then maybe just on the supply in the markets. We did see this historic wave, but these markets have always experienced- Yeah. ...a good level of supply. Yeah. How do you see the cycles playing out? Yeah. Well, I think you are right. The long-term average supply in our markets is about 3%. If you go back and look at the last, call it, 25 years or so, it is about 3% of inventory. I think it is important to keep in context the level of supply that we have seen. Over a three-year period, we saw five years' worth of supply being delivered into the market, so a significant excess level of supply. Having said that, this year is the first year where we have come below that long-term average. We are still absorbing some of the supply, as I talked about a moment ago, but supply levels this year are expected to be about 2%, 2.2% in our markets. That will fluctuate a little bit. If you go back and look at the trailing three years' worth of data, the starts that have happened in our region of the country have significantly trailed long-term averages. The trailing 12-month were at 1.9%. From a forward-looking perspective, we should be below long-term average deliveries for the next three to five years in our markets. As we sit here today, construction costs are not coming down. There is pressure on interest rates. It is hard to raise equity for some of these development deals. I think the supply pipeline will likely materially decline even further from here. To go back and look at a time where we saw supply levels at this level, you have got to go back and look at post GFC time period, and there is a five or six-year period where new supply deliveries were similar to this 2% range, and we were able to deliver NOIs that were about 200 basis points higher than historical average for us. I do think we are getting to the period where we should see better performance from an NOI perspective from a historical basis based on the fact that supply is coming down, demand is remaining pretty robust, and we are already seeing that. We are seeing that in our mid-tier markets. We are seeing that positive trend in Austin as we talked about, and I think that will become more broad-based as we get into next year. I guess as the development economics for others do not look as great but you want to lean in more to your development, I guess, how are you solving for that? Is it land you already own? We do have some land we own. I will tell you that it is difficult. We look at about 40- 50 development projects every quarter, and there might be one or two that underwrite or underwrote, to call it, a 6.5% yield. When we underwrote realistic rents, realistic taxes, most of those deals were in the mid-5s. So there is a material difference and gap between where deals need to be and majority of deals need to be and where they are today for that to really pick up. Again, the difficulty in starting new developments has been in access to capital. Debt is there, but it has been equity. I think a part of that is because when you realistically underwrite these deals with the correct expectations, they just do not underwrite. How long is the construction timeline right now? I know you are saying three to five years. It sounds like- Yeah. ...maybe those out years, it is more about that it will become more difficult to develop. Yeah. Versus is it really the next two to three years that we have true visibility? I do not know. Well, I think we have visibility right now based on the last 13 quarters of starts being below long-term average. I think we've got good visibility of what that looks like. In our markets, if I were to go and say today, "Hey, guys, let's go find a project," it normally takes about a year to get approval, and then it takes about two years for construction to get to your first unit. So you're talking three years from today if you were to go out and start that process today. And I say if because what we're hearing from a lot of our development partners is there's staff changes happening right now because of the lack of business in the development world. Developers are being let go. There's challenges in that space- Or that has no impact on- I don't think that has any impact on the resi developer. I think these development partners are skilled in developing multifamily, and there's just no volume out there right now for them. Can I ask one follow-up on the concessions? Sure. RealPage puts out articles on the concessions and I think the latest, but again, Jana, Andrew, tell me what we've been seeing. I think they've been talking about that it remains fairly deep, like a lot of were widespread. Then deep, I don't- Yeah. How do we tie that to- Yeah. ...your call. I thought earlier you were saying concessions, they're not changing. Yeah. What is going on? My comment would be in a high supplied market, they are deep in terms of the size, so they are call it eight weeks free, two months free, but the number of units in lease-up is shrinking. Normally, the market gets away from concessions in the stabilized. We do not offer concessions on our stabilized product. In most of the market, if they can, they do not have concessions in those communities. To the extent that there are properties in lease-up, those are offering concessions, it is just the number of lease-ups is contracted. Do you have any visibility into that? Again, these lease-up projects, are we finally clearing a point where on average we are past 70% or- Yeah. Is there any visibility into, okay, come 2027, this really should start to burn off? Yeah. The only stat I have in that regard, and these meetings run together, so I cannot remember if I mentioned it in this one, but we have 200,000 less units in lease-up this year than we had two years ago. So clearly what is happening is the number of units in lease-up is significantly contracting. It is being absorbed. If you look at the first half absorption, it exceeded the new supply coming into the market. So the units are getting absorbed. When you also add to that the fact that there is less new supply coming into the market and demand continues to remain pretty strong, the fundamentals are shifting as we have seen in the mid-tier markets and we have seen in a market like Austin where there is a lot of supply. It is shifting to where we are starting to see some better pricing performance. I think we would expect that to continue. [inaudible] On the external growth side, there has not really been much distress out there. I guess just given the volatility in rates over the last month and that we are approaching the slower season, could there potentially be some kind of pickup in opportunities? Well, I think there could be. We always prepare for that. That's part of the reason why we want to keep our balance sheet capacity where it is so we're able to take advantage of those opportunities materialize. We took advantage of that after the GFC. We bought 10,000 units in one-off transactions in a three-year period. So we're prepared and capable of doing that. I'd say in terms of distress, I think that's going to have to come from lenders forcing product to be sold. My sense is that may not happen just because the lenders don't really have anywhere to put that capital. They don't have other transactions to put that capital in. They don't have new developments to put that capital in. So they may be more reluctant to push that, but they certainly could. To the extent that they did, we would be there and ready to move. I guess kind of just like a catchall for in case we missed anything that came up in other meetings. Just if you can kind of comment on what gives you the most optimism heading into 2027 for the MAA portfolio. Well, I'm optimistic because for the first time, this year, we have a year where supply is decreasing below long-term averages, that will continue as we get into next year. I think you're starting to see the impact of that on the blended rates. I'm excited about the trajectory of what that'll look like when you get into a busier leasing season. Hard to see that impact a lot of times when you're in a slower leasing season in the fourth and first quarter. But I think certainly as you get into first quarter, we would expect that to be more broad based. So I'm excited to see what that looks like because we're seeing the green shoots of that occurring right now in a number of our markets. Okay. Is that different than because there's been hope, right? Yeah. For a while now that the turn would come. Yeah. And some were hoping even in 2026. Yeah. Is that the key difference between for 2027 versus 2026? That is having proof that it is occurring in a number of markets, yes. If you look at our mid-tier markets today, we are seeing blended rate growth of 3%-5% even third quarter- to- date. We are seeing significant, strong performance in those markets. When we start to see that also occurring in some of our higher supplied markets, I think it gives us confidence of what that trajectory could look like when we get into the busier spring leasing season. I think you said that you were tracking 2.2% of supply in 2026. Can you share 2027? Yeah. I think the last I saw was about 2.4%. 2.4%. Something like that. Some of those numbers move a little bit between years. Some things get moved around, but that's the latest that we've seen. Great. Anything giving you a little bit of concern heading into 2027? Well, I think the interest rate headwinds for sure, giving us concern. The thing that keeps me up is just anything that happens on the macro job front, potentially impacting us. I think the broad demand fundamentals continue to perform well from what we can see right now. Any shock to the system is obviously a concern. Clearly, balance sheet is in great shape, but just any kind of near-term maturities to call out for 2027? Yeah. For 2027, we have a maturity in June of next year for about $600 million. It is at an effective rate of about 3.7%. We will be working to see how to refinance that maturity. There are some different opportunities that we will have that we are evaluating at the moment. We would love to see interest rates come back to us a little bit, but where we sit here today, it is probably hard to see that making a material move that would be in our favor. I do not know if there is any questions in the room. Otherwise, I will jump into our rapid fire. We have three questions we have been asking all of the REITs at the conference. The first is, if long-term rates stay higher for longer, which has the biggest impact on your sector's earnings? Is it higher refinancing costs, lower transaction activity, or less new supply? Less new supply. Over the next three years, will third-party capital become a more important source of growth for public REITs? Yes or no? I can't answer that with a yes or no. I think it will be more prevalent, but not more important. For your sector, will 2027 same-store NOI growth be higher, the same, or lower than 2026? Higher. Great. Thank you so much. Really appreciate it. Yeah. Thank you.