EXHIBIT 99.1
Mid-America Apartment Communities
NAREIT Institutional Investor Conference June 2004
Safe Harbor Statement
Statements contained in this presentation, which
are not historical facts, are forward-looking
statements, as the term is defined in the Private
Securities Litigation Reform Act of 1995. Such
forward-looking statements are subject to risks
and uncertainties which can cause actual results
to differ materially from those currently
anticipated, due to a number of factors, which
include, but are not limited to, unfavorable
changes in the apartment market, changing
economic conditions, the impact of competition,
acquisitions which may not achieve anticipated
results and other risk factors discussed in documents
filed with the Securities and Exchange Commission
from time to time including the Company's
Annual Report on Form 10-K and the Company's
Quarterly Report on Form 10-Q. The
statements in this presentation are made based
upon information currently known to management
and the company assumes no obligation to update or
revise any of its forward-looking statements.
MAA Profile and Update
Regionally Focused, Efficient, Diversified, Strong Operator
* Efficient size with 129 properties; 36,712 units; 8th largest multifamily
REIT
* Focused on the stronger and more stable southeast and south central U.S.
region
* Uniquely diversified across large, middle and small-tier markets
* Lower risk profile through complete economic and market cycles - broad
market appeal
* Strong governance - independent, capital markets and public company
experience, multifamily expertise
MAA Profile and Update
Focused on the southeast/south central US with solid job growth, strong
immigration and demographic trends that support high and stable demand patterns.
Through disciplined acquisition and investment pricing practices, coupled with
strong operating capabilities, MAA is in a solid position to battle new
supply/competition pressures.
Average annual
forecasted employment
growth from 3Q03 to 3Q06:
Midwest 0.58%
Northeast 0.77%
Nat'l Major Markets 1.20%
Major Southern Mkts. 1.49%
Average annual
forecasted new supply
growth 2005-2007:
Major Southern Mkts. 1.22%
MAA Profile and Update
A New Strategy and Focus for MAA was Defined in Late 2001
* Commit to the current dividend pay-out; improve coverage
* Position to fund dividend from recurring operations
* Protect real estate value and long-term earnings potential of portfolio
during downturn in market conditions
* Create more flexibility for balance sheet; establish growth program
* Position portfolio and operation for stable performance and long-term,
steady growth in dividend and share value
MAA Profile and Update
A Well Defined Strategy With Solid Execution
* 2001 AFFO/share: $2.13/share
2003 AFFO/share: $2.27/share(1)
* Q104 AFFO was 65cents/share, $2.60 per share annualized
* Current dividend of $2.34
* Fixed charge ratio has improved from 2.18 in Q101 to 2.58 as of Q104
* Flexible debt program in place, maturities well laddered; positioned for
rising rate environment
* Earnings potential of portfolio protected; well positioned for recovery
* $211 million of accretive (to current earnings) growth captured over the
last 18 months
(1) Before a non-cash adjustment related to original issuance costs associated
with the redemption of preferred stock.
MAA Profile and Update
MAA - outperforming
in terms of property revenues,
overall FFO results
and shareholder return
[Bar graph depicts the following data]
2002 SS Revenue Growth 2003 SS Revenue Growth
---------------------- ----------------------
MAA -0.7% -1.0%
Sector Avg. -2.1% -1.8%
4Q03 Review
Green Street Adv.
Total Return
---------------------------------------------------
YTD 1-Year 3-Year 5-Year
-------- -------- --------- --------
MAA 8.83% 41.49% 90.33% 151.94%
AML 7.20% 28.83% 53.58% 84.20%
AIV -12.89% -10.98% -20.43% -0.59%
ASN 7.10% 28.75% 42.00% 80.98%
AEC 14.31% 45.98% 5.63% 28.17%
AVB 15.41% 36.73% 39.50% 106.04%
BRE 5.10% 12.60% 37.88% 86.06%
CPT 6.98% 42.17% 64.48% 143.02%
TCR -4.22% 17.42% 6.24% 29.58%
EQR -1.19% 16.64% 32.35% 69.35%
ESS 3.32% 19.15% 65.04% 170.05%
GBP 0.12% 21.13% 54.18% 115.99%
HME 1.17% 17.22% 67.32% 119.22%
PPS 5.90% 16.07% 2.90% 3.88%
SMT -0.66% 21.99% 17.35% 74.36%
TCT -0.60% 14.04% 57.65% 118.82%
UDR 7.22% 23.77% 84.61% 169.66%
Stifel, Nicolaus & Company
As of 5/28/04
MAA Profile and Update
2004 Forecast and Key Assumptions
* Same Store NOI
- 2.4% growth in 2004; Q104 SS NOI was .7% higher than Q1 prior year and
2.5% higher sequentially
* Same Store Occupancy
- 1.0% improvement over prior year (avg 93.7% for 2004); Q104 was 160
bps ahead of prior year
* Same Store Concessions
- Increase over prior year by 40 bps of net potential rent; Q104
concessions were ahead of prior year by 27%
* Interest Rates
- Projected based on forward yield curve; 75 bps higher by end of 2004
* Acquisitions, Dispositions
- Only one additional JV acquisition assumed (in December); no other
transactions assumed
* Financing
- $200 million to be refinanced in 2004; $4.6 million reduction planned
in annual interest cost
* Recurring Capital Expenditures
- $390 per unit across the portfolio; consistent with historical pattern
* Upgrade and Revenue Enhancing Capital Expenditures
- $166 per unit in property upgrades; mostly unit interior improvements
* First Call estimate of $2.94 FFO/share.
Positioned for Improving Markets Financing Capability
MAA Balance Sheet is better positioned, more flexible and stronger
* Balance sheet is well positioned for a rising interest rate environment
* Debt program provides excellent flexibility
* New credit facilities added $340 million of growth capacity
* Refinancing of $200 million on target this year; reducing annual interest
cost by $4.6 million
* By year end, 80% of total debt will have either fixed, swapped-fixed,
forward-swapped-fixed or capped interest expense
* Refinancing requirements are well laddered over the next 10 years
Positioned for Improving Markets Portfolio Quality
Acquisition pipeline is active; $150MM of potential acquisitions currently in
due diligence
$211 million* of new and
high-quality properties
were acquired during
2003; further positioning
MAA for strong
performance as the
economy recovers.
Legacy Pines, Houston
Lighthouse Court, Jacksonville
Los Rios Park, Dallas
Monthaven Place, Nashville
Timberglen, Dallas
*Excludes $77 million of joint venture interests acquired in 2003.
Positioned for Improving Markets Operating Strength
A number of re-tooling projects completed over the last 18 months
position the portfolio to not only recapture earnings from
improving markets, but to exceed prior historical norms
Reduce
lost revenue due
to inventory
churn & vacancy
[Slide depicts a circular flow of the below]
DELIVERY OF VACANT UNIT
Strict adherence to credit and background checks - protects earnings potential
New inventory management program
New property management system currently being rolled-out - onsite and back
room efficiencies
New maintenance efficiency program
"MARKET READY" STATUS
New regional marketing function rolled out in Q1 2004
New internet based marketing & leasing program rolled out in Q1 2004
LEASED UNIT
Limit pre-leasing to 5 business days
New revenue and pricing management tools and program
OCCUPIED UNIT
Limit turnover to 63% (down from 68%)
New property management system inventory management and lease expiration
system
DELIVERY OF VACANT UNIT
Positioned for Improving Markets Operating Upside Opportunity
A return to normal market conditions, in addition to new property and asset
management capabilities, is forecast to add 50cents - 55cents of additional
FFO/share
Current Normal Annualized Impact
Forecast Market/Goal FFO/Share
------------------ ------------------ --------------------
Occupancy 93% 95% 18.5cents
Concessions 3.2% net potential 1.4% net potential 18.2cents
Collection Loss 1.2% net potential 0.9% net potential 3.4cents
Lower Turnover-Vacancy 68.2% 63.0% 2.6cents
Lower Turnover-Expense 68.2% 63.0% 4.0cents
New Maintenance Efficiency Program 52.4 PUPM 49.4 PUPM 4.5cents
New Advertising Efficiency Program 12.7 PUPM 10.9 PUPM 2.7cents
-------------------
53.9cents FFO/Share
Case for Buying MAA
* Focused on the strong job-growth region of the country...solid prospects
* Well maintained properties, value protected; positioned to recover
* Diversified throughout the region to deliver steady, predictable results
* Focused on middle market product; higher stability and steady growth
* Focused operator with strong property management capabilities
* Balance sheet well positioned for rising rates; growth capacity
* Track record of disciplined and accretive growth
* Solid strategy, proven ability to execute
Case for Buying MAA
* Earnings upside
- Recapture of "normal market" economics; earnings power of portfolio
has been protected
- Incremental new earnings upside from "re-tooling" certain components
of our operation
- External growth capabilities
Case for Buying MAA
Strong, independent board governance - heavily experienced in corporate public
company governance, capital markets, leadership and apartment real estate
Independent Directors
* Robert Fogelman
- President, Fogelman Investments. 30 years of multifamily development
and property management.
* Ralph Horn
- Former Chairman/CEO First Tennessee. Director - Gaylord Entertainment,
Harrah's Entertainment.
* Mike Starnes
- CEO and President MS Carriers, Inc. Director - Swift Transportation
Co., Union Planters Corp.
* John Grinalds
- President, The Citadel University. Retired, Major General U.S. Marine
Corps.
* Alan Graf
- Executive Vice President and CFO, FedEx Corporation, Director - Nike
Inc., Kimball International.
Non-Management Directors
* George Cates
- Founder, former Chairman/CEO of MAA. 30 years multifamily experience.
Director, First Tennessee.
* John Flournoy
- Chairman and CEO, Flournoy Development Company (apartments), Director
- Synovus Financial.
Management Directors
* Eric Bolton
- Chairman and CEO, 10 years with MAA, 20 years real estate experience.
* Simon Wadsworth
- Executive Vice President and CFO, 10 years with MAA.
Insiders own 10.2% of MAA
Case for Buying MAA
As of 5/28/04 Current Yield Multiple of
market close 2004 FFO
- ---------------- ------------- ------------------ -----------
Essex 4.82% Post 17.5x
Avalon Bay 5.14% Avalon Bay 16.9x
Camden 5.44% Archstone 16.0x
BRE Properties 5.64% Essex 15.5X
Summit 5.83% BRE Properties 15.0X
United Dominion 5.87% Gables 15.0x
Equity 5.88% Camden 14.4x
Archstone 5.92% Summit 14.2x
Post 6.19% Town & Country 14.2x
Home Prop 6.27% Home 13.7x
Mid-America 6.63% Equity 13.7x
AMLI 6.92% AMLI 13.2x
Town & Country 7.07% United Dominion 12.9x
Gables 7.14% Mid-America 12.0X
AIMCO 8.31% AIMCO 10.4x
Associated Estates 8.50% Cornerstone 10.3x
Cornerstone 9.74% Associated Estates 8.0x
Average 6.55% Average 13.7
Stifel, Nicolaus & Company
MAA trades at a 14% discount
to sector average multiple
of projected 2004 FFO.
Priced at the sector average
yield and multiple,
MAA has pricing upside
potential of
$35.73 to $40.28;
an increase of up
to 14%.
Market pricing of
$54,000 per unit;
represents discount
to replacement value
Case for Buying MAA
AFFO Multiple of
Payout Ratio 2004 AFFO
------------ -----------
Essex 81.0% Town & Country 20.4x
United Dominion 89.3% Post 20.1x
Summit 91.8% Avalon Bay 17.9x
Avalon Bay 91.8% Archstone 17.9x
BRE Properties 92.0% Camden 17.2x
Cornerstone 93.0% Essex 16.8x
Camden 93.7% Equity 16.7x
Equity 98.3% BRE Properties 16.3x
Mid-America 100.0% Gables 16.5x
AMLI 101.1% Home 16.3x
Home Properties 102.1% Summit 15.8x
Archstone 106.2% United Dominion 15.2x
AIMCO 110.1% Mid-America 15.1x
Gables 118.1% AMLI 14.6x
Associated Estates 119.3% AIMCO 13.2x
Post 124.1% Associated Estates 14.0x
Town & Country 144.5% Cornerstone 9.5x
Average 103.3% Average 16.1x
Stifel, Nicolaus & Company
MAA has a
better than average
AFFO payout ratio
with below average pricing
...providing
upside pricing opportunity
of close to 7% on
sector average.
Case for Buying MAA
First Call 2004 FFO $ 2.94
Current MAA multiple 12.0x
Current Market Price $ 35.28
First Call 2004 FFO $ 2.94
Normalized occupancy performance $ 0.18
Normalized concession performance $ 0.20
Normalized collections performance $ 0.03
New Turnover goals $ 0.06
New Maintenance efficiency program $ 0.04
New Advertising efficiency program $ 0.02
Higher interest rate environment $ (0.24)
External growth - new acquisitions $ 0.00
Potential FFO performance (internal growth) $ 3.23
Existing MAA multiple 12.0x
Potential Market Price $ 38.75
Potential Market Price at
Sector Average Multiple (13.7) $ 44.25
Capture of additional NOI
as a result of improving
market conditions drives
current pricing up 9.8%
using the existing
depressed MAA multiple
...a move to the
sector average FFO multiple
drives current pricing
up a total of 25.4%
MAA Investment Summary
* Superior returns through all phases of cycle
* Diversified market approach in strong job growth region
* Proven long-term out-performance in sector
* Stable, consistent, predictable earnings
* High-quality, well-maintained properties
* Experienced and focused hands-on operator
* Improving dividend coverage; positioning for growth
* Strong corporate governance; experienced
* Earnings growth plans in place and underway
* New efficiencies and enhanced performance capabilities
* Markets recovering; long-term positive operating trends
* Upside pricing opportunity to sector and forecast
Mid-America Apartment Communities
End of Presentation