Item 1. Financial Statements.

Mid-America Apartment Communities, Inc.

Condensed Consolida****ted Balance Sheets

(Unaudited)

(Dollars in thousands, except share and per share data)

		September 30, 2021				December 31, 2020
Assets
Real estate assets:
Land		$	1,977,813			$	1,929,181
Buildings and improvements and other			12,369,733				12,065,244
Development and capital improvements in progress			236,339				283,477
			14,583,885				14,277,902
Less: Accumulated depreciation			(3,722,917	)			(3,415,105	)
			10,860,968				10,862,797
Undeveloped land			29,115				60,993
Investment in real estate joint venture			42,842				43,325
Real estate assets, net			10,932,925				10,967,115
Cash and cash equivalents			29,811				25,198
Restricted cash			11,710				10,417
Other assets			237,245				192,061
Assets held for sale			42,441				—
Total assets		$	11,254,132			$	11,194,791
Liabilities and equity
Liabilities:
Unsecured notes payable		$	4,175,256			$	4,077,373
Secured notes payable			365,631				485,339
Accrued expenses and other liabilities			598,592				528,274
Total liabilities			5,139,479				5,090,986
Redeemable common stock			24,323				15,397
Shareholders’ equity:
Preferred stock, $0.01 par value per share, 20,000,000 shares authorized;8.50% Series I Cumulative Redeemable Shares, liquidation preference $50.00per share, 867,846 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively			9				9
Common stock, $0.01 par value per share, 145,000,000 shares authorized;115,138,323 and 114,373,727 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively (1)			1,149				1,141
Additional paid-in capital			7,216,885				7,176,793
Accumulated distributions in excess of net income			(1,309,511	)			(1,294,182	)
Accumulated other comprehensive loss			(11,384	)			(12,128	)
Total MAA shareholders’ equity			5,897,148				5,871,633
Noncontrolling interests - OP Units			173,366				206,927
Total Company’s shareholders’ equity			6,070,514				6,078,560
Noncontrolling interests - consolidated real estate entities			19,816				9,848
Total equity			6,090,330				6,088,408
Total liabilities and equity		$	11,254,132			$	11,194,791

(1)

Number of shares issued and outstanding represents total shares of common stock regardless of classification on the Condensed Consolidated Balance Sheets. The number of shares classified as redeemable common stock on the Condensed Consolidated Balance Sheets as of September 30, 2021 and December 31, 2020 are 130,242 and 121,534, respectively.

See accompanying notes to condensed consolidated financial statements.

Mid-America Apartment Communities, Inc.

Condensed Consolidated S****tatements of Operations

(Unaudited)

(Dollars in thousands, except per share data)

		Three months ended September 30,								Nine months ended September 30,
		2021				2020				2021				2020
Revenues:
Rental and other property revenues		$	452,575			$	423,199			$	1,314,507			$	1,254,323
Expenses:
Operating expenses, excluding real estate taxes and insurance			106,412				105,108				304,124				292,031
Real estate taxes and insurance			66,426				64,706				199,943				188,426
Depreciation and amortization			134,611				127,679				397,938				381,257
Total property operating expenses			307,449				297,493				902,005				861,714
Property management expenses			13,831				12,691				40,522				39,064
General and administrative expenses			12,670				11,360				38,763				35,181
Interest expense			39,234				41,010				117,773				126,610
Loss (gain) on sale of depreciable real estate assets			313				(20	)			(134,515	)			7
Gain on sale of non-depreciable real estate assets			(170	)			(1,366	)			(202	)			(995	)
Other non-operating (income) expense			(10,344	)			(242	)			(14,557	)			13,647
Income before income tax expense			89,592				62,273				364,718				179,095
Income tax expense			(2,803	)			(665	)			(5,847	)			(2,532	)
Income from continuing operations before real estate joint venture activity			86,789				61,608				358,871				176,563
Income from real estate joint venture			258				428				915				1,153
Net income			87,047				62,036				359,786				177,716
Net income attributable to noncontrolling interests			2,568				2,126				11,636				6,096
Net income available for shareholders			84,479				59,910				348,150				171,620
Dividends to MAA Series I preferred shareholders			922				922				2,766				2,766
Net income available for MAA common shareholders		$	83,557			$	58,988			$	345,384			$	168,854
Earnings per common share - basic:
Net income available for MAA common shareholders		$	0.73			$	0.52			$	3.01			$	1.48
Earnings per common share - diluted:
Net income available for MAA common shareholders		$	0.73			$	0.52			$	3.01			$	1.47

See accompanying notes to condensed consolidated financial statements.

Mid-America Apartment Communities, Inc.

Condensed Consolidated Statem****ents of Comprehensive Income

(Unaudited)

(Dollars in thousands)

		Three months ended September 30,								Nine months ended September 30,
		2021				2020				2021				2020
Net income		$	87,047			$	62,036			$	359,786			$	177,716
Other comprehensive income:
Adjustment for net losses reclassified to net income from derivative instruments			278				279				835				810
Total comprehensive income			87,325				62,315				360,621				178,526
Less: Comprehensive income attributable to noncontrolling interests			(2,598	)			(2,136	)			(11,727	)			(6,124	)
Comprehensive income attributable to MAA		$	84,727			$	60,179			$	348,894			$	172,402

See accompanying notes to condensed consolidated financial statements.

Mid-America Apartment Communities, Inc.

Condensed Consolidated S****tatements of Cash Flows

(Unaudited)

(Dollars in thousands)

		Nine months ended September 30,
Cash flows from operating activities:		2021				2020
Net income		$	359,786			$	177,716
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			398,678				381,938
(Gain) loss on sale of depreciable real estate assets			(134,515	)			7
Gain on sale of non-depreciable real estate assets			(202	)			(995	)
(Gain) loss on embedded derivative in preferred shares			(11,492	)			14,603
Stock compensation expense			12,804				12,532
Amortization of debt issuance costs, discounts and premiums			4,142				3,595
Net change in operating accounts and other operating activities			49,049				54,489
Net cash provided by operating activities			678,250				643,885
Cash flows from investing activities:
Purchases of real estate and other assets			(46,028	)			(5,004	)
Capital improvements, development and other			(388,373	)			(288,183	)
Distributions from real estate joint venture			483				207
Contributions to affiliates			(1,971	)			(3,450	)
Proceeds from disposition of real estate assets			166,234				3,278
Net cash used in investing activities			(269,655	)			(293,152	)
Cash flows from financing activities:
Proceeds from revolving credit facility			—				245,000
Repayments of revolving credit facility			—				(245,000	)
Net payments on commercial paper			(147,000	)			(35,000	)
Proceeds from notes payable			594,423				447,593
Principal payments on notes payable			(466,817	)			(440,222	)
Payment of deferred financing costs			(5,922	)			(4,196	)
Distributions to noncontrolling interests			(12,009	)			(11,993	)
Dividends paid on common shares			(352,384	)			(342,983	)
Dividends paid on preferred shares			(2,766	)			(2,766	)
Net change in other financing activities			(10,214	)			(4,118	)
Net cash used in financing activities			(402,689	)			(393,685	)
Net increase (decrease) in cash, cash equivalents and restricted cash			5,906				(42,952	)
Cash, cash equivalents and restricted cash, beginning of period			35,615				70,541
Cash, cash equivalents and restricted cash, end of period		$	41,521			$	27,589

The following table provides a reconciliation of cash, cash equivalents and restricted cash to amounts reported within the Condensed Consolidated Balance Sheets:

Reconciliation of cash, cash equivalents and restricted cash:
Cash and cash equivalents		$	29,811			$	18,407
Restricted cash			11,710				9,182
Total cash, cash equivalents and restricted cash		$	41,521			$	27,589
Supplemental disclosure of cash flow information:
Interest paid		$	109,471			$	109,527
Income taxes paid			2,518				2,534
Supplemental disclosure of noncash investing and financing activities:
Conversion of OP Units to shares of common stock		$	33,272			$	471
Accrued construction in progress			18,484				41,443
Interest capitalized			7,781				4,783

See accompanying notes to condensed consolidated financial statements.

Mid-America Apartments, L.P.

Condensed Consolida****ted Balance Sheets

(Unaudited)

(Dollars in thousands, except unit data)

		September 30, 2021				December 31, 2020
Assets
Real estate assets:
Land		$	1,977,813			$	1,929,181
Buildings and improvements and other			12,369,733				12,065,244
Development and capital improvements in progress			236,339				283,477
			14,583,885				14,277,902
Less: Accumulated depreciation			(3,722,917	)			(3,415,105	)
			10,860,968				10,862,797
Undeveloped land			29,115				60,993
Investment in real estate joint venture			42,842				43,325
Real estate assets, net			10,932,925				10,967,115
Cash and cash equivalents			29,811				25,198
Restricted cash			11,710				10,417
Other assets			237,245				192,061
Assets held for sale			42,441				—
Total assets		$	11,254,132			$	11,194,791
Liabilities and capital
Liabilities:
Unsecured notes payable		$	4,175,256			$	4,077,373
Secured notes payable			365,631				485,339
Accrued expenses and other liabilities			598,592				528,274
Due to general partner			19				19
Total liabilities			5,139,498				5,091,005
Redeemable common units			24,323				15,397
Operating Partnership capital:
Preferred units, 867,846 preferred units outstanding as of September 30, 2021 and December 31, 2020, respectively			66,840				66,840
General partner, 115,138,323 and 114,373,727 OP Units outstanding as of September 30, 2021 and December 31, 2020, respectively (1)			5,841,950				5,817,270
Limited partners, 3,402,682 and 4,057,657 OP Units outstanding as of September 30, 2021 and December 31, 2020, respectively (1)			173,366				206,927
Accumulated other comprehensive loss			(11,661	)			(12,496	)
Total operating partners’ capital			6,070,495				6,078,541
Noncontrolling interests - consolidated real estate entities			19,816				9,848
Total equity			6,090,311				6,088,389
Total liabilities and equity		$	11,254,132			$	11,194,791

(1) Number of units outstanding represents total OP Units regardless of classification on the Condensed Consolidated Balance Sheets. The number of units classified as redeemable common units on the Condensed Consolidated Balance Sheets as of September 30, 2021 and December 31, 2020 are 130,242 and 121,534, respectively.

See accompanying notes to condensed consolidated financial statements.

Mid-America Apartments, L.P.

Condensed Consolidated S****tatements of Operations

(Unaudited)

(Dollars in thousands, except per unit data)

		Three months ended September 30,								Nine months ended September 30,
		2021				2020				2021				2020
Revenues:
Rental and other property revenues		$	452,575			$	423,199			$	1,314,507			$	1,254,323
Expenses:
Operating expenses, excluding real estate taxes and insurance			106,412				105,108				304,124				292,031
Real estate taxes and insurance			66,426				64,706				199,943				188,426
Depreciation and amortization			134,611				127,679				397,938				381,257
Total property operating expenses			307,449				297,493				902,005				861,714
Property management expenses			13,831				12,691				40,522				39,064
General and administrative expenses			12,670				11,360				38,763				35,181
Interest expense			39,234				41,010				117,773				126,610
Loss (gain) on sale of depreciable real estate assets			313				(20	)			(134,515	)			7
Gain on sale of non-depreciable real estate assets			(170	)			(1,366	)			(202	)			(995	)
Other non-operating (income) expense			(10,344	)			(242	)			(14,557	)			13,647
Income before income tax expense			89,592				62,273				364,718				179,095
Income tax expense			(2,803	)			(665	)			(5,847	)			(2,532	)
Income from continuing operations before real estate joint venture activity			86,789				61,608				358,871				176,563
Income from real estate joint venture			258				428				915				1,153
Net income			87,047				62,036				359,786				177,716
Distributions to MAALP preferred unitholders			922				922				2,766				2,766
Net income available for MAALP common unitholders		$	86,125			$	61,114			$	357,020			$	174,950
Earnings per common unit - basic:
Net income available for MAALP common unitholders		$	0.73			$	0.52			$	3.01			$	1.48
Earnings per common unit - diluted:
Net income available for MAALP common unitholders		$	0.73			$	0.52			$	3.01			$	1.48

See accompanying notes to condensed consolidated financial statements.

Mid-America Apartments, L.P.

Condensed Consolidated Statem****ents of Comprehensive Income

(Unaudited)

(Dollars in thousands)

		Three months ended September 30,								Nine months ended September 30,
		2021				2020				2021				2020
Net income		$	87,047			$	62,036			$	359,786			$	177,716
Other comprehensive income:
Adjustment for net losses reclassified to net income from derivative instruments			278				279				835				810
Comprehensive income attributable to MAALP		$	87,325			$	62,315			$	360,621			$	178,526

See accompanying notes to condensed consolidated financial statements.

Mid-America Apartments, L.P.

Condensed Consolidated S****tatements of Cash Flows

(Unaudited)

(Dollars in thousands)

		Nine months ended September 30,
Cash flows from operating activities:		2021				2020
Net income		$	359,786			$	177,716
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			398,678				381,938
(Gain) loss on sale of depreciable real estate assets			(134,515	)			7
Gain on sale of non-depreciable real estate assets			(202	)			(995	)
(Gain) loss on embedded derivative in preferred shares			(11,492	)			14,603
Stock compensation expense			12,804				12,532
Amortization of debt issuance costs, discounts and premiums			4,142				3,595
Net change in operating accounts and other operating activities			49,049				54,489
Net cash provided by operating activities			678,250				643,885
Cash flows from investing activities:
Purchases of real estate and other assets			(46,028	)			(5,004	)
Capital improvements, development and other			(388,373	)			(288,183	)
Distributions from real estate joint venture			483				207
Contributions to affiliates			(1,971	)			(3,450	)
Proceeds from disposition of real estate assets			166,234				3,278
Net cash used in investing activities			(269,655	)			(293,152	)
Cash flows from financing activities:
Proceeds from revolving credit facility			—				245,000
Repayments of revolving credit facility			—				(245,000	)
Net payments on commercial paper			(147,000	)			(35,000	)
Proceeds from notes payable			594,423				447,593
Principal payments on notes payable			(466,817	)			(440,222	)
Payment of deferred financing costs			(5,922	)			(4,196	)
Distributions paid on common units			(364,393	)			(354,976	)
Distributions paid on preferred units			(2,766	)			(2,766	)
Net change in other financing activities			(10,214	)			(4,118	)
Net cash used in financing activities			(402,689	)			(393,685	)
Net increase (decrease) in cash, cash equivalents and restricted cash			5,906				(42,952	)
Cash, cash equivalents and restricted cash, beginning of period			35,615				70,541
Cash, cash equivalents and restricted cash, end of period		$	41,521			$	27,589

The following table provides a reconciliation of cash, cash equivalents and restricted cash to amounts reported within the Condensed Consolidated Balance Sheets:

Reconciliation of cash, cash equivalents and restricted cash:
Cash and cash equivalents		$	29,811			$	18,407
Restricted cash			11,710				9,182
Total cash, cash equivalents and restricted cash		$	41,521			$	27,589
Supplemental disclosure of cash flow information:
Interest paid		$	109,471			$	109,527
Income taxes paid			2,518				2,534
Supplemental disclosure of noncash investing and financing activities:
Accrued construction in progress		$	18,484			$	41,443
Interest capitalized			7,781				4,783

See accompanying notes to condensed consolidated financial statements.

Mid-America Apartment Communities, Inc. and Mid-America Apartments, L.P.

Notes to Condensed Consoli****dated Financial Statements

(Unaudited)

1. Basis of Presentation and Principles of Consolidation and Significant Accounting Policies

Unless the context otherwise requires, all references to the “Company” refer collectively to Mid-America Apartment Communities, Inc., together with its consolidated subsidiaries, including Mid-America Apartments, L.P. Unless the context otherwise requires, all references to “MAA” refer only to Mid-America Apartment Communities, Inc., and not any of its consolidated subsidiaries. Unless the context otherwise requires, the references to the “Operating Partnership” or “MAALP” refer to Mid-America Apartments, L.P., together with its consolidated subsidiaries. “Common stock” refers to the common stock of MAA and, unless the context otherwise requires, “shareholders” refers to the holders of shares of MAA’s common stock. The common units of limited partnership interests in the Operating Partnership are referred to as “OP Units,” and the holders of the OP Units are referred to as “common unitholders”.

As of September 30, 2021, MAA owned 115,138,323 OP Units (or 97.1% of the total number of OP Units). MAA conducts substantially all of its business and holds substantially all of its assets, directly or indirectly, through the Operating Partnership, and by virtue of its ownership of the OP Units and being the Operating Partnership’s sole general partner, MAA has the ability to control all of the day-to-day operations of the Operating Partnership.

Management believes combining the notes to the condensed consolidated financial statements of MAA and the Operating Partnership results in the following benefits:



enhances a readers’ understanding of MAA and the Operating Partnership by enabling the reader to view the business as a whole in the same manner that management views and operates the business;



eliminates duplicative disclosure and provides a more streamlined and readable presentation since a substantial portion of the disclosure applies to both MAA and the Operating Partnership; and



creates time and cost efficiencies through the preparation of one combined set of notes instead of two separate sets.

MAA, an S&P 500 company, is a multifamily-focused, self-administered and self-managed real estate investment trust, or REIT. Management operates MAA and the Operating Partnership as one business. The management of the Company is comprised of individuals who are officers of MAA and employees of the Operating Partnership. Management believes it is important to understand the few differences between MAA and the Operating Partnership in the context of how MAA and the Operating Partnership operate as a consolidated company. MAA and the Operating Partnership are structured as an umbrella partnership REIT, or UPREIT. MAA’s interest in the Operating Partnership entitles MAA to share in cash distributions from, and in the profits and losses of, the Operating Partnership in proportion to MAA’s percentage interest therein and entitles MAA to vote on substantially all matters requiring a vote of the partners. MAA’s only material asset is its ownership of limited partnership interests in the Operating Partnership (other than cash held by MAA from time to time); therefore, MAA’s primary function is acting as the sole general partner of the Operating Partnership, issuing public equity from time to time and guaranteeing certain debt of the Operating Partnership from time to time. The Operating Partnership holds, directly or indirectly, all of the Company’s real estate assets. Except for net proceeds from public equity issuances by MAA, which are contributed to the Operating Partnership in exchange for limited partnership interests, the Operating Partnership generates the capital required by the business through the Operating Partnership’s operations, direct or indirect incurrence of indebtedness and issuance of OP Units.

The presentations of MAA’s shareholders’ equity and the Operating Partnership’s capital are the principal areas of difference between the condensed consolidated financial statements of MAA and those of the Operating Partnership. MAA’s shareholders’ equity may include shares of preferred stock, shares of common stock, additional paid-in capital, cumulative earnings, cumulative distributions, noncontrolling interests, treasury shares, accumulated other comprehensive loss and redeemable common stock. The Operating Partnership’s capital may include common capital and preferred capital of the general partner (MAA), limited partners’ common capital and preferred capital, noncontrolling interests, accumulated other comprehensive loss and redeemable common units. Holders of OP Units (other than MAA) may require the Operating Partnership to redeem their OP Units from time to time, in which case the Operating Partnership may, at its option, pay the redemption price either in cash (in an amount per OP Unit equal, in general, to the average closing price of MAA’s common stock on the New York Stock Exchange, or NYSE, over a specified period prior to the redemption date) or by delivering one share of MAA’s common stock (subject to adjustment under specified circumstances) for each OP Unit so redeemed.

Organization of Mid-America Apartment Communities, Inc.

The Company owns, operates, acquires and selectively develops apartment communities primarily located in the Southeast, Southwest and Mid-Atlantic regions of the United States. As of September 30, 2021, the Company owned and operated 296 apartment communities through the Operating Partnership and its subsidiaries and had an ownership interest in one apartment community

through an unconsolidated real estate joint venture. As of September 30, 2021, the Company also had eight development communities under construction totaling 2,654 apartment units once complete. Total expected costs for the eight development projects are $627.5 million, of which $383.8 million had been incurred through September 30, 2021. The Company expects to complete three of these developments in 2021, two developments in 2022 and three developments in 2023. As of September 30, 2021, 32 of the Company’s apartment communities included retail components. The Company’s apartment communities, including development communities under construction, were located across 16 states and the District of Columbia as of September 30, 2021.

Basis of Presentation and Principles of Consolidation

The accompanying condensed consolidated financial statements have been prepared by the Company’s management in accordance with United States generally accepted accounting principles, or GAAP, and applicable rules and regulations of the Securities and Exchange Commission, or the SEC. The condensed consolidated financial statements of MAA presented herein include the accounts of MAA, the Operating Partnership and all other subsidiaries in which MAA has a controlling financial interest. MAA owns, directly or indirectly, approximately 80% to 100% of all consolidated subsidiaries, including the Operating Partnership. The condensed consolidated financial statements of MAALP presented herein include the accounts of MAALP and all other subsidiaries in which MAALP has a controlling financial interest. MAALP owns, directly or indirectly, 80% to 100% of all consolidated subsidiaries. In management’s opinion, all adjustments necessary for a fair presentation of the condensed consolidated financial statements have been included, and all such adjustments were of a normal recurring nature. All significant intercompany accounts and transactions have been eliminated in consolidation.

The Company invests in entities which may qualify as variable interest entities, or VIEs, and MAALP is considered a VIE. A VIE is a legal entity in which the equity investors lack sufficient equity at risk for the entity to finance its activities without additional subordinated financial support or, as a group, the holders of the equity investment at risk lack the power to direct the activities of a legal entity as well as the obligation to absorb its expected losses or the right to receive its expected residual returns. MAALP is classified as a VIE because the limited partners lack substantive kick-out rights and substantive participating rights. The Company consolidates all VIEs for which it is the primary beneficiary and uses the equity method to account for investments that qualify as VIEs but for which it is not the primary beneficiary. In determining whether the Company is the primary beneficiary of a VIE, management considers both qualitative and quantitative factors, including, but not limited to, those activities that most significantly impact the VIE’s economic performance and which party controls such activities. The Company uses the equity method of accounting for its investments in entities for which the Company exercises significant influence, but does not have the ability to exercise control. The factors considered in determining whether the Company has the ability to exercise control include ownership of voting interests and participatory rights of investors (see “Investments in Unconsolidated Affiliates” below).

Noncontrolling Interests

As of September 30, 2021, the Company had two types of noncontrolling interests with respect to its consolidated subsidiaries: (1) noncontrolling interests related to the common unitholders of its Operating Partnership; and (2) noncontrolling interests related to its consolidated real estate entities. The noncontrolling interests relating to the limited partnership interests in the Operating Partnership are owned by the holders of the Class A OP Units. MAA is the sole general partner of the Operating Partnership and holds all of the outstanding Class B OP Units. Net income (after allocations to preferred ownership interests) is allocated to MAA and the noncontrolling interests based on their respective ownership percentages of the Operating Partnership. Issuance of additional Class A OP Units or Class B OP Units changes the ownership percentage of both the noncontrolling interests and MAA. The issuance of Class B OP Units generally occurs when MAA issues common stock and the issuance proceeds are contributed to the Operating Partnership in exchange for Class B OP Units equal to the number of shares of MAA’s common stock issued. At each reporting period, the allocation between total MAA shareholders’ equity and noncontrolling interests is adjusted to account for the change in the respective percentage ownership of the underlying equity of the Operating Partnership. MAA’s Board of Directors established economic rights in respect to each Class A OP Unit that were equivalent to the economic rights in respect to each share of MAA common stock. See Note 9 for additional details.

The noncontrolling interests relating to the Company’s five consolidated real estate entities are owned by private real estate companies that are generally responsible for the development and construction of the apartment communities that are owned through the consolidated real estate entities with a noncontrolling interest. The entities were determined to be VIE’s with the Company designated as the primary beneficiary. As a result, the accounts of the entities are consolidated by the Company. As of September 30, 2021, the consolidated assets and liabilities of the Company’s consolidated real estate entities with a noncontrolling interest were $218.8 million and $15.3 million, respectively. As of December 31, 2020, the consolidated assets and liabilities of the Company’s consolidated real estate entities with a noncontrolling interest were $128.9 million and $8.1 million, respectively.

Investments in Unconsolidated Affiliates

The Company uses the equity method to account for its investments in a real estate joint venture and two technology-focused limited partnerships that each qualify as a VIE. Management determined the Company is not the primary beneficiary in any of these investments but does have the ability to exert significant influence over the operations and financial policies of the real estate joint venture and considers its investments in the limited partnerships to be more than minor. The Company’s investment in the real estate joint venture was $42.8 million and $43.3 million as of September 30, 2021 and December 31, 2020, respectively.

As of September 30, 2021 and December 31, 2020, the Company’s investments in the technology-focused limited partnerships were $43.0 million and $23.0 million, respectively, and are included in “Other assets” in the accompanying Condensed Consolidated Balance Sheets. As of September 30, 2021, the Company was committed until February 2025 to make additional capital contributions totaling $18.7 million if and when called by the general partners of the limited partnerships.

Fair Value Measurements

The Company applies the guidance in Accounting Standards Codification (“ASC”) Topic 820, Fair Value Measurements and Disclosures, to the valuation of real estate assets recorded at fair value, to its impairment valuation analysis of real estate assets, to its disclosure of the fair value of financial instruments, principally indebtedness and to its derivative financial instruments. Fair value disclosures required under ASC Topic 820 as well as the Company’s derivative accounting policies are summarized in Note 7 utilizing the following hierarchy:

Level 1 - Quoted prices in active markets for identical assets or liabilities that are accessible at the measurement date.

Level 2 - Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly.

Level 3 - Unobservable inputs for the assets or liability.

Revenue Recognition

The Company primarily leases multifamily residential apartments to residents under operating leases generally due on a monthly basis with terms of approximately one year or less. Rental revenues are recognized in accordance with ASC Topic 842, Leases, using a method that represents a straight-line basis over the term of the lease. In addition, in circumstances where a lease incentive is provided to tenants, the incentive is recognized as a reduction of rental revenues on a straight-line basis over the reasonably assured lease term. Rental revenues represent approximately 93% of the Company’s total revenues and include gross rents charged less adjustments for concessions and bad debt. Approximately 6% of the Company’s total revenues represent non-lease reimbursable property revenues from its residents for utility reimbursements, which are generally recognized and due on a monthly basis as residents obtain control of the service over the term of the lease. The remaining 1% of the Company’s total revenues represents other non-lease property revenues primarily driven by nonrefundable fees and commissions.

In accordance with ASC Topic 842, rental revenues and non-lease reimbursable property revenues meet the criteria to be aggregated into a single lease component and are reported on a combined basis in the line item “Rental revenues”, as presented in the disaggregation of the Company’s revenues in Note 11. Other non-lease property revenues are accounted for in accordance with ASC Topic 606, Revenue from Contracts with Customers, which requires revenue recognized outside of the scope of ASC Topic 842 to be recognized when a customer obtains control of promised goods or services in an amount that reflects the consideration the entity expects to receive in exchange for those goods or services. Other non-lease property revenues are reported in the line item “Other property revenues”, as presented in the disaggregation of the Company’s revenues in Note 11.

Leases

The Company is the lessee under certain ground, office, equipment and other operational leases, all of which are accounted for as operating leases in accordance with ASC Topic 842. The Company recognizes a right-of-use asset for the right to use the underlying asset for all leases where the Company is the lessee with terms of more than twelve months, and a related lease liability for the obligation to make lease payments. Expenses related to leases determined to be operating leases are recognized on a straight-line basis. As of September 30, 2021 and December 31, 2020, right-of-use assets recorded within “Other assets” totaled $47.7 million and $49.4 million, respectively, and related lease obligations recorded within “Accrued expenses and other liabilities” totaled $30.7 million and $31.7 million, respectively, in the Condensed Consolidated Balance Sheets. As of September 30, 2021, the Company’s operating leases had a weighted average remaining lease term of approximately 32 years and a weighted average discount rate of approximately 4.4%. Lease expense recognized for the three and nine months ended September 30, 2021 and 2020 was immaterial to the Company. Cash paid for amounts included in the measurement of operating lease liabilities during the nine months ended September 30, 2021 and 2020 was also immaterial.

2. Earnings per Common Share of MAA

Basic earnings per share is computed by dividing net income available to MAA common shareholders by the weighted average number of common shares outstanding during the period. All outstanding unvested restricted share awards contain rights to non-forfeitable dividends and participate in undistributed earnings with shareholders and, accordingly, are considered participating securities that are included in the two-class method of computing basic earnings per share. Both the unvested restricted shares and other potentially dilutive common shares, and the related impact to earnings, are considered when calculating earnings per share on a diluted basis with diluted earnings per share being the more dilutive of the treasury stock or two-class methods. OP Units are included in dilutive earnings per share calculations when the units are dilutive to earnings per share.

For the three and nine months ended September 30, 2021 and 2020, MAA’s diluted earnings per share was computed using the treasury stock method as presented below (dollars and shares in thousands, except per share amounts):

		Three months ended September 30,								Nine months ended September 30,
		2021				2020				2021				2020
Calculation of Earnings per common share - basic
Net income		$	87,047			$	62,036			$	359,786			$	177,716
Net income attributable to noncontrolling interests			(2,568	)			(2,126	)			(11,636	)			(6,096	)
Unvested restricted stock (allocation of earnings)			(80	)			(78	)			(359	)			(229	)
Preferred dividends			(922	)			(922	)			(2,766	)			(2,766	)
Net income available for MAA common shareholders, adjusted		$	83,477			$	58,910			$	345,025			$	168,625
Weighted average common shares - basic			114,933				114,216				114,568				114,177
Earnings per common share - basic		$	0.73			$	0.52			$	3.01			$	1.48
Calculation of Earnings per common share - diluted
Net income		$	87,047			$	62,036			$	359,786			$	177,716
Net income attributable to noncontrolling interests (1)			(2,568	)			(2,126	)			(11,636	)			(6,096	)
Preferred dividends			(922	)			(922	)			(2,766	)			(2,766	)
Net income available for MAA common shareholders, adjusted		$	83,557			$	58,988			$	345,384			$	168,854
Weighted average common shares - basic			114,933				114,216				114,568				114,177
Effect of dilutive securities			296				252				305				310
Weighted average common shares - diluted			115,229				114,468				114,873				114,487
Earnings per common share - diluted		$	0.73			$	0.52			$	3.01			$	1.47

(1)

For the three and nine months ended September 30, 2021 3.5 million OP Units and 3.8 million OP Units, respectively, and their related income are not included in the diluted earnings per share calculations as they are not dilutive. For the three and nine months ended September 30, 2020, 4.1 million OP Units and their related income are not included in the diluted earnings per share calculations as they are not dilutive.

3. Earnings per OP Unit of MAALP

Basic earnings per common unit is computed by dividing net income available for common unitholders by the weighted average number of OP Units outstanding during the period. All outstanding unvested restricted unit awards contain rights to non-forfeitable distributions and participate in undistributed earnings with common unitholders and, accordingly, are considered participating securities that are included in the two-class method of computing basic earnings per common unit. Diluted earnings per common unit reflects the potential dilution that could occur if securities or other contracts to issue OP Units were exercised or converted into OP Units. Both the unvested restricted unit awards and other potentially dilutive common units, and the related impact to earnings, are considered when calculating earnings per common unit on a diluted basis with diluted earnings per common unit being the more dilutive of the treasury stock or two-class methods.

For the three and nine months ended September 30, 2021 and 2020, MAALP’s diluted earnings per common unit was computed using the treasury stock method as presented below (dollars and units in thousands, except per unit amounts):

		Three months ended September 30,								Nine months ended September 30,
		2021				2020				2021				2020
Calculation of Earnings per common unit - basic
Net income		$	87,047			$	62,036			$	359,786			$	177,716
Unvested restricted stock (allocation of earnings)			(80	)			(78	)			(359	)			(229	)
Preferred unit distributions			(922	)			(922	)			(2,766	)			(2,766	)
Net income available for MAALP common unitholders, adjusted		$	86,045			$	61,036			$	356,661			$	174,721
Weighted average common units - basic			118,430				118,274				118,389				118,238
Earnings per common unit - basic		$	0.73			$	0.52			$	3.01			$	1.48
Calculation of Earnings per common unit - diluted
Net income		$	87,047			$	62,036			$	359,786			$	177,716
Preferred unit distributions			(922	)			(922	)			(2,766	)			(2,766	)
Net income available for MAALP common unitholders, adjusted		$	86,125			$	61,114			$	357,020			$	174,950
Weighted average common units - basic			118,430				118,274				118,389				118,238
Effect of dilutive securities			296				252				305				310
Weighted average common units - diluted			118,726				118,526				118,694				118,548
Earnings per common unit - diluted		$	0.73			$	0.52			$	3.01			$	1.48

4. MAA Equity

Changes in MAA’s total equity and its components for the three months ended September 30, 2021 and 2020 were as follows (dollars in thousands):

		Mid-America Apartment Communities, Inc. Shareholders’ Equity
		Preferred Stock				Common Stock				Additional Paid-In Capital				Accumulated Distributions in Excess of Net Income				Accumulated Other Comprehensive Loss				Noncontrolling Interests - Operating Partnership				Noncontrolling Interests - Consolidated Real Estate Entities				Total Equity
EQUITY BALANCE JUNE 30, 2021		$	9			$	1,147			$	7,201,885			$	(1,272,694	)		$	(11,632	)		$	185,340			$	16,612			$	6,120,667
Net income			—				—				—				84,479				—				2,568				—				87,047
Other comprehensive income - derivative instruments			—				—				—				—				248				30				—				278
Issuance and registration of common shares			—				—				(103	)			—				—				—				—				(103	)
Exercise of stock options			—				—				12				—				—				—				—				12
Shares issued in exchange for common units			—				2				11,106				—				—				(11,108	)			—				—
Redeemable stock fair market value adjustment			—				—				—				(2,356	)			—				—				—				(2,356	)
Adjustment for noncontrolling interests in Operating Partnership			—				—				(22	)			—				—				22				—				—
Amortization of unearned compensation			—				—				4,007				—				—				—				—				4,007
Dividends on preferred stock			—				—				—				(922	)			—				—				—				(922	)
Dividends on common stock ($1.025 per share)			—				—				—				(118,018	)			—				—				—				(118,018	)
Dividends on noncontrolling interests units ($1.025 per share)			—				—				—				—				—				(3,486	)			—				(3,486	)
Contribution from noncontrolling interest			—				—				—				—				—				—				3,204				3,204
EQUITY BALANCE SEPTEMBER 30, 2021		$	9			$	1,149			$	7,216,885			$	(1,309,511	)		$	(11,384	)		$	173,366			$	19,816			$	6,090,330

		Mid-America Apartment Communities, Inc. Shareholders’ Equity
		Preferred Stock				Common Stock				Additional Paid-In Capital				Accumulated Distributions in Excess of Net Income				Accumulated Other Comprehensive Loss				Noncontrolling Interests - Operating Partnership				Noncontrolling Interests - Consolidated Real Estate Entities				Total Equity
EQUITY BALANCE JUNE 30, 2020		$	9			$	1,140			$	7,168,886			$	(1,202,536	)		$	(12,665	)		$	209,894			$	6,849			$	6,171,577
Net income			—				—				—				59,910				—				2,126				—				62,036
Other comprehensive income - derivative instruments			—				—				—				—				269				10				—				279
Issuance and registration of common shares			—				—				33				—				—				—				—				33
Shares issued in exchange for common units			—				—				21				—				—				(21	)			—				—
Redeemable stock fair market value adjustment			—				—				—				(155	)			—				—				—				(155	)
Adjustment for noncontrolling interests in Operating Partnership			—				—				71				—				—				(71	)			—				—
Amortization of unearned compensation			—				—				4,380				—				—				—				—				4,380
Dividends on preferred stock			—				—				—				(922	)			—				—				—				(922	)
Dividends on common stock ($1.000 per share)			—				—				—				(114,369	)			—				—				—				(114,369	)
Dividends on noncontrolling interests units ($1.000 per share)			—				—				—				—				—				(3,866	)			—				(3,866	)
Contribution from noncontrolling interest			—				—				—				—				—				—				262				262
EQUITY BALANCE SEPTEMBER 30, 2020		$	9			$	1,140			$	7,173,391			$	(1,258,072	)		$	(12,396	)		$	208,072			$	7,111			$	6,119,255

Changes in MAA’s total equity and its components for the nine months ended September 30, 2021 and 2020 were as follows (dollars in thousands):

		Mid-America Apartment Communities, Inc. Shareholders’ Equity
		Preferred Stock				Common Stock				Additional Paid-In Capital				Accumulated Distributions in Excess of Net Income				Accumulated Other Comprehensive Loss				Noncontrolling Interests - Operating Partnership				Noncontrolling Interests - Consolidated Real Estate Entities				Total Equity
EQUITY BALANCE DECEMBER 31, 2020		$	9			$	1,141			$	7,176,793			$	(1,294,182	)		$	(12,128	)		$	206,927			$	9,848			$	6,088,408
Net income			—				—				—				348,150				—				11,636				—				359,786
Other comprehensive income - derivative instruments			—				—				—				—				744				91				—				835
Issuance and registration of common shares			—				2				(438	)			—				—				—				—				(436	)
Shares repurchased and retired			—				—				(9,043	)			—				—				—				—				(9,043	)
Exercise of stock options			—				—				1,478				—				—				—				—				1,478
Shares issued in exchange for common units			—				6				33,266				—				—				(33,272	)			—				—
Redeemable stock fair market value adjustment			—				—				—				(7,545	)			—				—				—				(7,545	)
Adjustment for noncontrolling interests in Operating Partnership			—				—				678				—				—				(678	)			—				—
Amortization of unearned compensation			—				—				14,151				—				—				—				—				14,151
Dividends on preferred stock			—				—				—				(2,766	)			—				—				—				(2,766	)
Dividends on common stock ($3.075 per share)			—				—				—				(353,168	)			—				—				—				(353,168	)
Dividends on noncontrolling interests units ($3.075 per share)			—				—				—				—				—				(11,338	)			—				(11,338	)
Contribution from noncontrolling interest			—				—				—				—				—				—				9,968				9,968
EQUITY BALANCE SEPTEMBER 30, 2021		$	9			$	1,149			$	7,216,885			$	(1,309,511	)		$	(11,384	)		$	173,366			$	19,816			$	6,090,330

		Mid-America Apartment Communities, Inc. Shareholders’ Equity
		Preferred Stock				Common Stock				Additional Paid-In Capital				Accumulated Distributions in Excess of Net Income				Accumulated Other Comprehensive Loss				Noncontrolling Interests - Operating Partnership				Noncontrolling Interests - Consolidated Real Estate Entities				Total Equity
EQUITY BALANCE DECEMBER 31, 2019		$	9			$	1,140			$	7,166,073			$	(1,085,479	)		$	(13,178	)		$	214,647			$	6,247			$	6,289,459
Net income			—				—				—				171,620				—				6,096				—				177,716
Other comprehensive income - derivative instruments			—				—				—				—				782				28				—				810
Issuance and registration of common shares			—				—				(344	)			—				—				—				—				(344	)
Shares repurchased and retired			—				—				(5,657	)			—				—				—				—				(5,657	)
Exercise of stock options			—				—				71				—				—				—				—				71
Shares issued in exchange for common units			—				—				471				—				—				(471	)			—				—
Redeemable stock fair market value adjustment			—				—				—				1,659				—				—				—				1,659
Adjustment for noncontrolling interests in Operating Partnership			—				—				244				—				—				(244	)			—				—
Amortization of unearned compensation			—				—				12,533				—				—				—				—				12,533
Dividends on preferred stock			—				—				—				(2,766	)			—				—				—				(2,766	)
Dividends on common stock ($3.000 per share)			—				—				—				(343,106	)			—				—				—				(343,106	)
Dividends on noncontrolling interests units ($3.000 per share)			—				—				—				—				—				(11,984	)			—				(11,984	)
Contribution from noncontrolling interest			—				—				—				—				—				—				864				864
EQUITY BALANCE SEPTEMBER 30, 2020		$	9			$	1,140			$	7,173,391			$	(1,258,072	)		$	(12,396	)		$	208,072			$	7,111			$	6,119,255

5. MAALP Capital

Changes in MAALP’s total capital and its components for the three months ended September 30, 2021 and 2020 were as follows (dollars in thousands):

		Mid-America Apartments, L.P. Unitholders’ Capital
		Limited Partners				General Partner				Preferred Units				Accumulated Other Comprehensive Loss				Noncontrolling Interests - Consolidated Real Estate Entities				Total Partnership Capital
CAPITAL BALANCE JUNE 30, 2021		$	185,340			$	5,863,795			$	66,840			$	(11,939	)		$	16,612			$	6,120,648
Net income			2,568				83,557				922				—				—				87,047
Other comprehensive income - derivative instruments			—				—				—				278				—				278
Issuance of units			—				(103	)			—				—				—				(103	)
Exercise of unit options			—				12				—				—				—				12
General partnership units issued in exchange for limited partnership units			(11,108	)			11,108				—				—				—				—
Redeemable units fair market value adjustment			—				(2,356	)			—				—				—				(2,356	)
Adjustment for limited partners’ capital at redemption value			52				(52	)			—				—				—				—
Amortization of unearned compensation			—				4,007				—				—				—				4,007
Distributions to preferred unitholders			—				—				(922	)			—				—				(922	)
Distributions to common unitholders ($1.025 per unit)			(3,486	)			(118,018	)			—				—				—				(121,504	)
Contribution from noncontrolling interest			—				—				—				—				3,204				3,204
CAPITAL BALANCE SEPTEMBER 30, 2021		$	173,366			$	5,841,950			$	66,840			$	(11,661	)		$	19,816			$	6,090,311

		Mid-America Apartments, L.P. Unitholders’ Capital
		Limited Partners				General Partner				Preferred Units				Accumulated Other Comprehensive Loss				Noncontrolling Interests - Consolidated Real Estate Entities				Total Partnership Capital
CAPITAL BALANCE JUNE 30, 2020		$	209,894			$	5,901,028			$	66,840			$	(13,053	)		$	6,849			$	6,171,558
Net income			2,126				58,988				922				—				—				62,036
Other comprehensive income - derivative instruments			—				—				—				279				—				279
Issuance of units			—				33				—				—				—				33
General partnership units issued in exchange for limited partnership units			(21	)			21				—				—				—				—
Redeemable units fair market value adjustment			—				(155	)			—				—				—				(155	)
Adjustment for limited partners’ capital at redemption value			(61	)			61				—				—				—				—
Amortization of unearned compensation			—				4,380				—				—				—				4,380
Distributions to preferred unitholders			—				—				(922	)			—				—				(922	)
Distributions to common unitholders ($1.000 per unit)			(3,866	)			(114,369	)			—				—				—				(118,235	)
Contribution from noncontrolling interest			—				—				—				—				262				262
CAPITAL BALANCE SEPTEMBER 30, 2020		$	208,072			$	5,849,987			$	66,840			$	(12,774	)		$	7,111			$	6,119,236

Changes in MAALP’s total capital and its components for the nine months ended September 30, 2021 and 2020 were as follows (dollars in thousands):

		Mid-America Apartments, L.P. Unitholders’ Capital
		Limited Partners				General Partner				Preferred Units				Accumulated Other Comprehensive Loss				Noncontrolling Interests - Consolidated Real Estate Entities				Total Partnership Capital
CAPITAL BALANCE DECEMBER 31, 2020		$	206,927			$	5,817,270			$	66,840			$	(12,496	)		$	9,848			$	6,088,389
Net income			11,636				345,384				2,766				—				—				359,786
Other comprehensive income - derivative instruments			—				—				—				835				—				835
Issuance of units			—				(436	)			—				—				—				(436	)
Units repurchased and retired			—				(9,043	)			—				—				—				(9,043	)
Exercise of unit options			—				1,478				—				—				—				1,478
General partnership units issued in exchange for limited partnership units			(33,272	)			33,272				—				—				—				—
Redeemable units fair market value adjustment			—				(7,545	)			—				—				—				(7,545	)
Adjustment for limited partners’ capital at redemption value			(587	)			587				—				—				—				—
Amortization of unearned compensation			—				14,151				—				—				—				14,151
Distributions to preferred unitholders			—				—				(2,766	)			—				—				(2,766	)
Distributions to common unitholders ($3.075 per unit)			(11,338	)			(353,168	)			—				—				—				(364,506	)
Contribution from noncontrolling interest			—				—				—				—				9,968				9,968
CAPITAL BALANCE SEPTEMBER 30, 2021		$	173,366			$	5,841,950			$	66,840			$	(11,661	)		$	19,816			$	6,090,311

		Mid-America Apartments, L.P. Unitholders’ Capital
		Limited Partners				General Partner				Preferred Units				Accumulated Other Comprehensive Loss				Noncontrolling Interests - Consolidated Real Estate Entities				Total Partnership Capital
CAPITAL BALANCE DECEMBER 31, 2019		$	214,647			$	6,015,290			$	66,840			$	(13,584	)		$	6,247			$	6,289,440
Net income			6,096				168,854				2,766				—				—				177,716
Other comprehensive income - derivative instruments			—				—				—				810				—				810
Issuance of units			—				(344	)			—				—				—				(344	)
Units repurchased and retired			—				(5,657	)			—				—				—				(5,657	)
Exercise of unit options			—				71				—				—				—				71
General partnership units issued in exchange for limited partnership units			(471	)			471				—				—				—				—
Redeemable units fair market value adjustment			—				1,659				—				—				—				1,659
Adjustment for limited partners’ capital at redemption value			(216	)			216				—				—				—				—
Amortization of unearned compensation			—				12,533				—				—				—				12,533
Distributions to preferred unitholders			—				—				(2,766	)			—				—				(2,766	)
Distributions to common unitholders ($3.000 per unit)			(11,984	)			(343,106	)			—				—				—				(355,090	)
Contribution from noncontrolling interest			—				—				—				—				864				864
CAPITAL BALANCE SEPTEMBER 30, 2020		$	208,072			$	5,849,987			$	66,840			$	(12,774	)		$	7,111			$	6,119,236

6. Borrowings

The following table summarizes the Company’s outstanding debt as of September 30, 2021 (dollars in thousands):

		Balance				Weighted Average Effective Rate				Weighted Average Contract Maturity
Unsecured debt
Variable rate commercial paper program		$	25,000				0.2	%		10/1/2021
Fixed rate senior notes			4,175,000				3.3	%		3/4/2029
Debt issuance costs, discounts, premiums and fair market value adjustments			(24,744	)
Total unsecured debt		$	4,175,256				3.3	%
Secured debt
Fixed rate property mortgages		$	368,892				4.4	%		9/17/2048
Debt issuance costs			(3,261	)
Total secured debt		$	365,631				4.4	%
Total outstanding debt		$	4,540,887				3.4	%

Unsecured Revolving Credit Facility

In May 2019, MAALP entered into a $1.0 billion unsecured revolving credit facility with a syndicate of banks led by Wells Fargo Bank, National Association, or Wells Fargo, and fourteen other banks, which is referred to as the Credit Facility. The Credit Facility replaced MAALP’s previous unsecured revolving credit facility, and it includes an expansion option up to $1.5 billion. The Credit Facility bears an interest rate of the London Interbank Offered Rate, or LIBOR, plus a spread of 0.75% to 1.45% based on an investment grade pricing grid. The Credit Facility matures in May 2023 with an option to extend for two additional six-month periods. As of September 30, 2021, there was no outstanding balance under the Credit Facility, while $3.4 million of capacity was used to support outstanding letters of credit.

Unsecured Commercial Paper

In May 2019, MAALP established an unsecured commercial paper program whereby MAALP may issue unsecured commercial paper notes with varying maturities not to exceed 397 days up to a maximum aggregate principal amount outstanding of $500.0 million. As of September 30, 2021, MAALP had $25.0 million outstanding under the commercial paper program. For the three months ended September 30, 2021, the average daily borrowings outstanding under the commercial paper program were $161.5 million.

Unsecured Senior Notes

As of September 30, 2021, MAALP had $4.2 billion of publicly issued unsecured senior notes outstanding. The unsecured senior notes had maturities at issuance ranging from 5 to 30 years, with a weighted average of 7.4 years remaining until maturity as of September 30, 2021.

In July 2021, MAALP retired a $72.8 million tranche of privately placed unsecured senior notes at maturity.

In August 2021, MAALP publicly issued $300 million in aggregate principal amount of unsecured senior notes maturing September 2026 with a coupon rate of 1.100% per annum, or the 2026 Notes. The purchase price paid by the purchasers of the 2026 Notes was 99.553% of the principal amount. The 2026 Notes are general unsecured senior obligations of MAALP and rank equally in right of payment with all other unsecured senior indebtedness of MAALP. Interest on the 2026 Notes is payable semi-annually in arrears on March 15 and September 15 of each year beginning March 15, 2022. The net proceeds of the offering were $296.9 million, after deducting the original issue discount, underwriting commissions and expenses totaling $3.1 million. The 2026 Notes have an effective interest rate of 1.191% and have been reflected net of discount and debt issuance costs in the accompanying Condensed Consolidated Balance Sheets as of September 30, 2021.

In August 2021, MAALP also publicly issued $300 million in aggregate principal amount of unsecured senior notes maturing September 2051 with a coupon rate of 2.875% per annum, or the 2051 Notes. The purchase price paid by the purchasers of the 2051 Notes was 98.588% of the principal amount. The 2051 Notes are general unsecured senior obligations of MAALP and rank equally in right of payment with all other unsecured senior indebtedness of MAALP. Interest on the 2051 Notes is payable semi-annually in arrears on March 15 and September 15 of each year beginning March 15, 2022. The net proceeds of the offering were $293.1 million, after deducting the original issue discount, underwriting commissions and expenses totaling $6.9 million. The 2051 Notes have an effective interest rate of 2.946% and have been reflected net of discount and debt issuance costs in the accompanying Condensed Consolidated Balance Sheets as of September 30, 2021.

In September 2021, MAALP retired a $117.0 million tranche of privately placed unsecured senior notes due in November 2022, a $125.0 million portion of the $250.0 million in aggregate principal amount of publicly issued unsecured senior notes due in December 2022, a $12.3 million tranche of privately placed unsecured senior notes due in July 2023, and a $20.0 million tranche of privately placed unsecured senior notes due in November 2024. MAALP incurred $13.4 million in prepayment penalties and write-offs of unamortized costs resulting from the debt retirements in the third quarter of 2021. These costs are included in “Other non-operating (income) expense” in the accompanying Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2021.

Secured Property Mortgages

As of September 30, 2021, MAALP had $368.9 million of fixed rate conventional property mortgages with a weighted average interest rate of 4.4% and a weighted average maturity in 2048.

In February 2021, MAALP retired a $118.6 million mortgage associated with eight apartment communities prior to its June 2021 maturity.

7. Financial Instruments and Derivatives

Financial Instruments Not Carried at Fair Value

Cash and cash equivalents, restricted cash and accrued expenses and other liabilities are carried at amounts that reasonably approximate their fair value due to their short term nature.

Fixed rate notes payable as of September 30, 2021 and December 31, 2020, totaled $4.5 billion and $4.4 billion, respectively, and had estimated fair values of $4.9 billion and $4.9 billion (excluding prepayment penalties) as of September 30, 2021 and December 31, 2020, respectively. The fair values of fixed rate debt are determined by using the present value of future cash outflows discounted with the applicable current market rate plus a credit spread. The carrying values of variable rate debt as of September 30, 2021 and December 31, 2020, totaled $25.0 million and $172.0 million, respectively, and had estimated fair values of $25.0 million and $172.0 million (excluding prepayment penalties) as of September 30, 2021 and December 31, 2020, respectively. The fair values of variable rate debt are determined using the stated variable rate plus the current market credit spread. The variable rates reset at various maturities, typically less than 30 days, and management concluded these rates reasonably estimate current market rates.

Financial Instruments Measured at Fair Value on a Recurring Basis

As of September 30, 2021, the Company had one outstanding series of cumulative redeemable preferred stock, which is referred to as the MAA Series I preferred stock (see Note 8). The Company has recognized a derivative asset related to the redemption feature embedded in the MAA Series I preferred stock. The derivative asset is valued using widely accepted valuation techniques, including a discounted cash flow analysis in which the perpetual value of the preferred shares is compared to the value of the preferred shares assuming the call option is exercised, with the value of the bifurcated call option as the difference between the two values. The analysis reflects the contractual terms of the redeemable preferred shares, which are redeemable at the Company’s option beginning on October 1, 2026 at the redemption price of $50.00 per share. The Company uses various inputs in the analysis, including trading data available on the preferred shares, coupon yields on preferred stock issuances from REITs with similar credit ratings as MAA and treasury rates to determine the fair value of the bifurcated call option.

The redemption feature embedded in the MAA Series I preferred stock is reported as a derivative asset in “Other assets” in the accompanying Condensed Consolidated Balance Sheets and is adjusted to its fair value at each reporting date, with a corresponding non-cash adjustment to “Other non-operating (income) expense” in the accompanying Condensed Consolidated Statements of Operations. As a result of adjustments of non-cash expense recorded to reflect the change in fair value of the derivative asset during the nine months ended September 30, 2021, the fair value of the embedded derivative asset increased to $50.5 million as of September 30, 2021 as compared to $39.0 million as of December 31, 2020.

The Company has determined the majority of the inputs used to value its outstanding debt and its embedded derivative fall within Level 2 of the fair value hierarchy, and as a result, the fair value valuation of its debt and embedded derivative held as of September 30, 2021 and December 31, 2020 were classified as Level 2 in the fair value hierarchy.

Terminated Cash Flow Hedges of Interest

As of September 30, 2021, the Company had $11.7 million recorded in “Accumulated other comprehensive loss” related to realized losses associated with terminated interest rate swaps that were designated as cash flow hedging instruments prior to their termination. The realized losses associated with the terminated interest rate swaps are reclassified to interest expense as interest payments are made on the Company’s debt and will continue to be reclassified to interest expense until the debt’s maturity. During the next twelve months, the Company estimates an additional $1.1 million will be reclassified to earnings as an increase to “Interest expense”.

Tabular Disclosure of the Effect of Derivative Instruments on the Condensed Consolidated Statements of Operations

The tables below present the effect of the Company’s derivative financial instruments on the Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2021 and 2020 (dollars in thousands):

Derivatives in Cash Flow Hedging Relationships		Location of Loss Reclassified		Net Loss Reclassified from Accumulated OCL into Interest Expense**(1)**
Three months ended September 30,		from Accumulated OCL into Income		2021				2020
Terminated interest rate swaps		Interest expense		$	(278	)		$	(279	)
Nine months ended September 30,
Terminated interest rate swaps		Interest expense		$	(835	)		$	(810	)

(1)

See the Condensed Consolidated Statements of Comprehensive Income for changes in accumulated other comprehensive loss as these changes are presented net of the allocation to noncontrolling interests.

Derivative Not Designated as Hedging Instrument		Location of Gain (Loss) Recognized		Gain (Loss) Recognized in Earnings on Derivative
Three months ended September 30,		in Income on Derivative		2021				2020
Preferred stock embedded derivative		Other non-operating (income) expense		$	13,432			$	1,342
Nine months ended September 30,
Preferred stock embedded derivative		Other non-operating (income) expense		$	11,492			$	(14,603	)

8. Shareholders’ Equity of MAA

As of September 30, 2021, 115,138,323 shares of common stock of MAA and 3,402,682 OP Units (excluding the OP Units held by MAA) were issued and outstanding, representing a total of 118,541,005 common shares and units. As of September 30, 2020, 114,369,812 shares of common stock of MAA and 4,058,258 OP Units (excluding the OP Units held by MAA) were issued and outstanding, representing a total of 118,428,070 common shares and units. Options to purchase 813 shares of MAA’s common stock were outstanding as of September 30, 2021, compared to 19,845 outstanding options as of September 30, 2020. During the nine months ended September 30, 2021 and 2020, MAA issued 19,032 common shares and 918 common shares, respectively, related to the exercise of stock options. These exercises resulted in net proceeds of $1.5 million and $0.1 million, respectively.

Preferred Stock

As of September 30, 2021, MAA had one outstanding series of cumulative redeemable preferred stock, which has the following characteristics:

Description		Outstanding Shares				Liquidation Preference**(1)**				Optional Redemption Date		Redemption Price**(2)**				Stated Dividend Yield				Approximate Dividend Rate
Series I			867,846			$	50.00			10/1/2026		$	50.00				8.50	%		$	4.25

(1)

The total liquidation preference for the outstanding preferred stock is $43.4 million.

(2)

The redemption price is the price at which the preferred stock is redeemable, at MAA’s option, for cash.

See Note 7 for details of the valuation of the derivative asset related to the redemption feature embedded in the MAA Series I preferred stock.

Equity Forward Sale Agreements

In August 2021, MAA entered into two 18-month forward sale agreements with respect to a total of 1.1 million shares of its common stock at an initial forward sale price of $190.56 per share. Under the forward sale agreements, the forward sale price is subject to adjustment on a daily basis based on a floating interest rate factor equal to a specified daily rate less a spread and will be decreased based on amounts related to dividends on MAA’s common stock during the term of the forward sale agreements. No shares had been settled under the forward sale agreements as of September 30, 2021. MAA generally has the ability to determine the dates and method of settlement (i.e., gross physical settlement, net share settlement or cash settlement), subject to certain conditions and the right of the counterparty to accelerate settlement under certain circumstances, provided that settlement under each forward sale agreement must occur by February 2, 2023. MAA currently expects to fully physically settle each forward sale agreement with the relevant forward purchaser on one or more dates specified by MAA on or prior to the maturity date of the particular forward sale agreement, in which case MAA expects to receive aggregate net cash proceeds at settlement equal to the number of shares underlying the particular forward sale agreement multiplied by the relevant forward sale price.

The Company accounts for the shares of MAA’s common stock reserved for issuance upon settlement as equity in accordance with ASC 815-40, Contracts in Entity’s Own Equity, which permits equity classification when a contract is considered indexed to its own stock and the contract requires or permits the issuing entity to settle the contract in shares (either physically or net in shares).

The guidance in ASC Topic 815-40 establishes a two-step process for evaluating whether an equity-linked financial instrument is considered indexed to its own stock by evaluating the instrument’s contingent exercise provisions and the instrument’s settlement provisions. When entering into the forward sale agreements, the Company determined that (i) none of the agreements’ exercise contingencies are based on observable markets or indices besides those related to the market of MAA’s common stock price; and (ii) none of the settlement provisions preclude the agreements from being indexed to MAA’s common stock.

Before the issuance of shares of MAA’s common stock, upon physical or net share settlement of the forward sale agreements, the Company expects that the shares issuable upon settlement of the forward sale agreements will be reflected in its diluted earnings per share calculations using the treasury stock method. Under this method, the number of shares of common stock used in calculating diluted earnings per share is deemed to be increased by the excess, if any, of the number of shares of common stock that would be issued upon full physical settlement of the forward sale agreements over the number of shares of common stock that could be purchased by MAA in the open market (based on the average market price during the period) using the proceeds to be received upon full physical settlement (based on the adjusted forward sale price at the end of the reporting period). When MAA physically or net

share settles a forward sale agreement, the delivery of shares of common stock would result in an increase in the number of weighted average common shares outstanding and dilution to basic earnings per share. The impact of the forward sale agreements was not dilutive to the Company’s diluted earnings per share for the three and nine months ended September 30, 2021.

9. Partners’ Capital of MAALP

Common units of limited partnership interests in MAALP are represented by OP Units. As of September 30, 2021, there were 118,541,005 OP Units outstanding, 115,138,323, or 97.1%, of which represent Class B OP Units (common units issued to or held by MAALP’s general partner or any of its subsidiaries), which were owned by MAA, MAALP’s general partner. The remaining 3,402,682 OP Units were Class A OP Units owned by Class A limited partners. As of September 30, 2020, there were 118,428,070 OP Units outstanding, 114,369,812, or 96.6%, of which were owned by MAA and 4,058,258 of which were owned by the Class A limited partners.

MAA, as the sole general partner of MAALP, has full, complete and exclusive discretion to manage and control the business of MAALP subject to the restrictions specifically contained within MAALP’s agreement of limited partnership, or the Partnership Agreement. Unless otherwise stated in the Partnership Agreement, this power includes, but is not limited to, acquiring, leasing or disposing of any real property; constructing buildings and making other improvements to properties owned; borrowing money, modifying or extinguishing current borrowings, issuing evidence of indebtedness and securing such indebtedness by mortgage, deed of trust, pledge or other lien on MAALP’s assets; and distribution of MAALP’s cash or other assets in accordance with the Partnership Agreement. MAA can generally, at its sole discretion, issue and redeem OP Units and determine the consideration to be received or the redemption price to be paid, as applicable. The general partner may delegate these and other powers granted to it if the general partner remains in supervision of the designee.

Under the Partnership Agreement, MAALP may issue Class A OP Units and Class B OP Units. Class A OP Units are any OP Units other than Class B OP Units, while Class B OP Units are those issued to or held by MAALP’s general partner or any of its subsidiaries. In general, the limited partners do not have the power to participate in the management or control of MAALP’s business except in limited circumstances, including changes in the general partner and protective rights if the general partner acts outside of the provisions provided in the Partnership Agreement. The transferability of Class A OP Units is also limited by the Partnership Agreement.

Net income of MAALP (after allocations to preferred ownership interests) is allocated to the general partner and limited partners based on their respective ownership percentages of MAALP. Issuance or redemption of additional Class A OP Units or Class B OP Units changes the relative ownership percentage of the partners. The issuance of Class B OP Units generally occurs when MAA issues common stock and the proceeds from that issuance are contributed to MAALP in exchange for the issuance to MAA of a number of OP Units equal to the number of shares of common stock issued. Likewise, if MAA repurchases or redeems outstanding shares of common stock, MAALP generally redeems an equal number of Class B OP Units with similar terms held by MAA for a redemption price equal to the purchase price of those shares of common stock. At each reporting period, the allocation between general partner capital and limited partner capital is adjusted to account for the change in the respective percentage ownership of the underlying capital of MAALP. Holders of the Class A OP Units may require MAA to redeem their Class A OP Units, in which case MAA may, at its option, pay the redemption price either in cash (in an amount per Class A OP Unit equal, in general, to the average closing price of MAA’s common stock on the NYSE over a specified period prior to the redemption date) or by delivering one share of MAA common stock (subject to adjustment under specified circumstances) for each Class A OP Unit so redeemed.

As of September 30, 2021, a total of 3,402,682 Class A OP Units were outstanding and redeemable for 3,402,682 shares of MAA common stock, with an approximate value of $635.5 million, based on the closing price of MAA’s common stock on September 30, 2021 of $186.75 per share. As of September 30, 2020, a total of 4,058,258 Class A OP Units were outstanding and redeemable for 4,058,258 shares of MAA common stock, with an approximate value of $470.6 million, based on the closing price of MAA’s common stock on September 30, 2020 of $115.95 per share. MAALP pays the same per unit distributions in respect to the OP Units as the per share dividends MAA pays in respect to its common stock.

As of September 30, 2021, MAALP had one outstanding series of cumulative redeemable preferred units, or the MAALP Series I preferred units. The MAALP Series I preferred units have the same characteristics as the MAA Series I preferred stock described in Note 8. As of September 30, 2021, 867,846 units of the MAALP Series I preferred units were outstanding. See Note 7 for details of the valuation of the derivative asset related to the redemption feature embedded in the MAALP Series I preferred units.

10. Commitments and Contingencies

Leases

The Company’s leases include a ground lease expiring in 2074 related to one of its apartment communities and an office lease expiring in 2028 related to its corporate headquarters. Both leases contain stated rent increases that generally compensate for the impact of inflation. The Company also has other commitments related to immaterial office and equipment operating leases.

The table below reconciles undiscounted cash flows for each of the first five years and total of the remaining years to the operating lease obligations recorded on the Condensed Consolidated Balance Sheets as of September 30, 2021 (in thousands):

		Operating Leases
2021		$	717
2022			2,894
2023			2,885
2024			2,862
2025			2,872
Thereafter			62,913
Total minimum lease payments			75,143
Net present value adjustments			(44,425	)
Operating lease obligations		$	30,718

Legal Proceedings

In June 2016, plaintiffs Cathi Cleven and Tara Cleven, on behalf of a purported class of plaintiffs, filed a complaint against MAA and the Operating Partnership in the United States District Court for the Western District of Texas, Austin Division. In January 2017, Areli Arellano and Joe L. Martinez joined the lawsuit as additional plaintiffs. The lawsuit alleges that the Company (but not Post Properties (see the description of the Brown class action lawsuit below)) charged late fees at its Texas properties that violate Section 92.019 of the Texas Property Code, or Section 92.019, which provides that a landlord may not charge a tenant a late fee for failing to pay rent unless, among other things, the fee is a reasonable estimate of uncertain damages to the landlord that are incapable of precise calculation and result from the late payment of rent. The plaintiffs are seeking monetary damages and attorneys’ fees and costs. In September 2018, the District Court certified a class proposed by the plaintiffs. Additionally, in September 2018, the District Court denied the Company’s motion for summary judgment and granted the plaintiffs’ motion for partial summary judgment. Because the District Court certified a class prior to granting the plaintiffs’ motion for partial summary judgment, the District Court’s ruling applies to the entire class. In October 2018, the Fifth Circuit Court of Appeals accepted the Company’s petition to review the District Court’s order granting class certification. In September 2019, the Fifth Circuit Court of Appeals heard the Company’s oral arguments. The Company also intends to appeal the District Court’s order granting plaintiff’s motion for summary judgment to the Fifth Circuit Court of Appeals if permission to appeal is granted. The Company will continue to vigorously defend the action and pursue such appeals. Management estimates that the Company’s maximum exposure in the lawsuit, given the class certification and summary judgment ruling, is $54.6 million, which includes both potential damages and attorneys’ fees but excludes any prejudgment interest that may be awarded.

In April 2017, plaintiff Nathaniel Brown, on behalf of a purported class of plaintiffs, filed a complaint against the Operating Partnership, as the successor by merger to Post Properties’ primary operating partnership, and MAA in the United States District Court for the Western District of Texas, Austin Division. The lawsuit alleges that Post Properties (and, following the Post Properties merger in December 2016, the Operating Partnership) charged late fees at its Texas properties that violate Section 92.019. The plaintiffs are seeking monetary damages and attorney’s fees and costs. In September 2018, the District Court certified a class proposed by the plaintiff. Additionally, in September 2018, the District Court denied the Company’s motion for summary judgment and granted the plaintiff’s motion for partial summary judgment. Because the District Court certified a class prior to granting the plaintiff’s motion for partial summary judgment, the District Court’s ruling applies to the entire class. In October 2018, the Fifth Circuit Court of Appeals accepted the Company’s petition to review the District Court’s order granting class certification. In September 2019, the Fifth Circuit Court of Appeals heard the Company’s oral arguments. The Company also intends to appeal the District Court’s order granting plaintiff’s motion for summary judgment to the Fifth Circuit Court of Appeals if permission to appeal is granted. The Company will continue to vigorously defend the action and pursue such appeals. Management estimates that the Company’s maximum exposure in the lawsuit, given the class certification and summary judgment ruling, is $8.4 million, which includes both potential damages and attorneys’ fees but excludes any prejudgment interest that may be awarded.

The Company is subject to various other legal proceedings and claims that arise in the ordinary course of its business operations. Matters which arise out of allegations of bodily injury, property damage and employment practices are generally covered by insurance. While the resolution of these other matters cannot be predicted with certainty, management does not currently believe that such matters, either individually or in the aggregate, will have a material adverse effect on the Company’s financial condition, results of operations or cash flows in the event of a negative outcome.

Loss Contingencies

The outcomes of claims, disputes and legal proceedings are subject to significant uncertainty. The Company records an accrual for loss contingencies when a loss is probable and the amount of the loss can be reasonably estimated. The Company also accrues an estimate of defense costs expected to be incurred in connection with legal matters. Management reviews these accruals quarterly and makes revisions based on changes in facts and circumstances. When a loss contingency is not both probable and reasonably estimable, management does not accrue the loss. However, if the loss (or an additional loss in excess of the accrual) is at least a reasonable possibility and material, then management discloses a reasonable estimate of the possible loss, or range of loss, if such reasonable estimate can be made. If the Company cannot make a reasonable estimate of the possible loss, or range of loss, then a statement to that effect is disclosed.

The assessment of whether a loss is probable or a reasonable possibility, and whether the loss or range of loss is reasonably estimable, often involves a series of complex judgments about future events. Among the factors considered in this assessment, are the nature of existing legal proceedings and claims, the asserted or possible damages or loss contingency (if reasonably estimable), the progress of the matter, existing law and precedent, the opinions or views of legal counsel and other advisers, management’s experience in similar matters, the facts available to management at the time of assessment, and how the Company intends to respond, or has responded, to the proceeding or claim. Management’s assessment of these factors may change over time as individual proceedings or claims progress. For matters where management is not currently able to reasonably estimate a range of reasonably possible loss, the factors that have contributed to this determination include the following: (i) the damages sought are indeterminate; (ii) the proceedings are in the early stages; (iii) the matters involve novel or unsettled legal theories or a large or uncertain number of actual or potential cases or parties; and/or (iv) discussions with the parties in matters that are ultimately expected to be resolved through negotiation and settlement have not reached the point where management believes a reasonable estimate of loss, or range of loss, can be made. The Company believes that there is considerable uncertainty regarding the timing or ultimate resolution of such matters, including a possible eventual loss or business impact, if any.

As of September 30, 2021 and December 31, 2020, the Company’s accrual for loss contingencies relating to unresolved legal matters was $5.2 million and $5.3 million in the aggregate, respectively. The loss contingencies are presented in “Accrued expenses and other liabilities” in the accompanying Condensed Consolidated Balance Sheets.

11. Segment Information

As of September 30, 2021, the Company owned and operated 296 multifamily apartment communities (which does not include development communities under construction) in 15 different states from which it derived all significant sources of earnings and operating cash flows. The Company views each consolidated apartment community as an operating segment. The Company’s chief operating decision maker, which is the Company’s Chief Executive Officer, evaluates performance and determines resource allocations of each of the apartment communities on a Same Store and Non-Same Store and Other basis, as well as an individual apartment community basis. This is consistent with the aggregation criteria under GAAP as each of the apartment communities generally has similar economic characteristics, facilities, services, and tenants.

The following reflects the two reportable segments for the Company:



Same Store includes communities that the Company has owned and have been stabilized for at least a full 12 months.



Non-Same Store and Other includes recently acquired communities, communities in development or lease-up, communities that have been identified for disposition, communities that have incurred a significant casualty loss and stabilized communities that do not meet the requirements to be Same Store communities. Also included in Non-Same Store and Other are non-multifamily activities.

On the first day of each calendar year, the Company determines the composition of its Same Store and Non-Same Store and Other reportable segments for that year as well as adjusts the previous year, which allows the Company to evaluate full period-over-period operating comparisons. Communities previously in development or lease-up are added to the Same Store segment on the first day of the calendar year after the community has been owned and stabilized for at least a full 12 months. Communities are considered stabilized after achieving 90% average physical occupancy for 90 days. Communities that have been identified for disposition are excluded from the Same Store segment.

The chief operating decision maker utilizes net operating income, or NOI, in evaluating the performance of its operating segments. Total NOI represents total property revenues less total property operating expenses, excluding depreciation and amortization, for all properties held during the period regardless of their status as held for sale. Management believes that NOI is a helpful tool in evaluating the operating performance of the segments because it measures the core operations of property performance by excluding corporate level expenses and other items not directly related to property operating performance.

Revenues and NOI for each reportable segment for the three and nine months ended September 30, 2021 and 2020 were as follows (in thousands):

		Three months ended September 30,								Nine months ended September 30,
		2021				2020				2021				2020
Revenues:
Same Store
Rental revenues		$	431,030			$	403,574			$	1,249,053			$	1,197,610
Other property revenues			2,966				3,103				9,302				9,159
Total Same Store revenues			433,996				406,677				1,258,355				1,206,769
Non-Same Store and Other
Rental revenues			18,449				16,447				55,372				47,438
Other property revenues			130				75				780				116
Total Non-Same Store and Other revenues			18,579				16,522				56,152				47,554
Total rental and other property revenues		$	452,575			$	423,199			$	1,314,507			$	1,254,323
Net Operating Income:
Same Store NOI		$	269,393			$	244,513			$	779,194			$	747,581
Non-Same Store and Other NOI			10,344				8,872				31,246				26,285
Total NOI			279,737				253,385				810,440				773,866
Depreciation and amortization			(134,611	)			(127,679	)			(397,938	)			(381,257	)
Property management expenses			(13,831	)			(12,691	)			(40,522	)			(39,064	)
General and administrative expenses			(12,670	)			(11,360	)			(38,763	)			(35,181	)
Interest expense			(39,234	)			(41,010	)			(117,773	)			(126,610	)
(Loss) gain on sale of depreciable real estate assets			(313	)			20				134,515				(7	)
Gain on sale of non-depreciable real estate assets			170				1,366				202				995
Other non-operating income (expense)			10,344				242				14,557				(13,647	)
Income tax expense			(2,803	)			(665	)			(5,847	)			(2,532	)
Income from real estate joint venture			258				428				915				1,153
Net income attributable to noncontrolling interests			(2,568	)			(2,126	)			(11,636	)			(6,096	)
Dividends to MAA Series I preferred shareholders			(922	)			(922	)			(2,766	)			(2,766	)
Net income available for MAA common shareholders		$	83,557			$	58,988			$	345,384			$	168,854

Assets for each reportable segment as of September 30, 2021 and December 31, 2020 were as follows (in thousands):

		September 30, 2021				December 31, 2020
Assets:
Same Store		$	9,910,526			$	10,076,511
Non-Same Store and Other			1,140,873				937,375
Corporate assets			202,733				180,905
Total assets		$	11,254,132			$	11,194,791

12. Real Estate Acquisitions and Dispositions

The following table reflects the Company’s acquisition activity for the nine months ended September 30, 2021:

Multifamily Development Acquisitions (1)		Market		Units (2)				Date Acquired
Novel Daybreak		Salt Lake City, UT			400			April 2021
Novel West Midtown		Atlanta, GA			340			April 2021

(1)

These pre-purchase multifamily community developments are being developed through joint ventures with a local developer. The Company owns 80% of each joint venture that owns these properties.

(2)

Represents number of units upon completion of the development.

Land Acquisition		Market		Acres		Date Acquired
MAA Westshore		Tampa, FL		19		June 2021

The following table reflects the Company’s disposition activity for the nine months ended September 30, 2021:

Multifamily Disposition		Market		Units				Date Sold
Crosswinds		Jackson, MS			360			June 2021
Pear Orchard		Jackson, MS			389			June 2021
Reflection Pointe		Jackson, MS			296			June 2021
Lakeshore Landing		Jackson, MS			196			June 2021
Land Disposition		Market		Acres				Date Sold
Colonial Promenade		Huntsville, AL			1			September 2021
Tutwiler		Birmingham, AL			9			September 2021