- Sun Belt concessions average five weeks, with lease-up deals reaching up to 10 weeks for MAA competitors.
- MAA expects supply to fall sharply in 2026 as new starts remain down 70% from previous peaks.
- Richmond, Kansas City, and Greenville led the portfolio in Q4 2025 same-store revenue growth.
- MAA plans $932M worth of acquisition and development projects as demand strengthens.
Sun Belt Concessions Pressure Earnings
Multifamily Dive reports that Sun Belt concessions continued to weigh on MAA’s performance in Q4 2025, with same-store revenues flat and net operating income down 0.5% year over year. Approximately two-thirds of the REIT’s competitors are offering concessions averaging five weeks, while lease-up concessions stretch to eight to 10 weeks. Despite the pressure, MAA executives remain optimistic that tightening supply and resilient demand will fuel a recovery beginning in 2026.
Demand and Supply Dynamics Improve
MAA leadership highlighted falling new deliveries, projecting a more than 60% decline in 2026 compared to prior peaks. New project starts are down nearly 70% since the last market high. Job growth in MAA’s Sun Belt markets is expected to hit 340,000 to 350,000 new roles this year, with apartment completions at roughly half that pace, improving the job-to-completion ratio. Rent-to-income ratios have also improved, making rents more affordable for residents.
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Market Performance and Regional Trends
Richmond, Kansas City, and Greenville were MAA’s top-performing markets in Q4 2025, posting revenue gains of 4.2%, 3%, and 2.9% year over year, respectively. Mid-tier Sun Belt markets such as Charleston, Greenville, Richmond, and the D.C. area saw stable pricing and occupancy levels. Conversely, Austin, Huntsville, San Antonio, and Memphis lagged, with Austin struggling under the weight of 25% new inventory added in four years. Concessions increased slightly in places like downtown Nashville and Raleigh, but decreased in Tampa and Houston, with Phoenix showing stability.
Growth, Pipeline, and Outlook
Amid an improving outlook for Sun Belt concessions, MAA is pursuing both acquisitions and new development. The REIT’s active project pipeline totals $932M, including new sites in Kansas City, Phoenix, and Northern Virginia. MAA expects to start construction on five to seven new developments in 2026, with stabilized NOI yields between 6% and 6.5%. Executives believe these projects will benefit from ongoing supply constraints and robust demand, supporting revenue and earnings growth even as Sun Belt concessions moderate. These leasing dynamics align with broader multifamily trends expected to shape 2026 strategies, especially as operators continue adapting to evolving renter behavior and market pressures.
