So, would you attribute that more to the regulators or to something else out there that’s not forcing the deals that you would have otherwise expected to happen?
Brad Hill : Yes. This is Brad. I think there’s really two components of that. I would say, number one, we have seen a number of loans, specifically in 2023. The last number I saw was 85% of the loans that were coming due, we’re pushed. We’re extended in 2023. So, I do think there is a component of that, that has occurred. I think relative to developers, specifically, I think for them, over the last couple of years, there’s been a change in how they have approached their construction lending, in the term that they’re able to get in their construction loans now is longer than what I have ever seen it before, where they’re able to get four years to five years in their term of their construction loans. And a lot of times, they have the ability built in if they’re hitting certain coverage ratios, they’re able to extend that six months, one year, two years.
there are certain components built into those loans that I think are allowing developers to be a little bit more runway before they’re forced to sell on new construction loans. So, I think those two components are really addressing that.
Eric Bolton: And Alex, this is Eric. I’ll add on to what Brad is saying. A couple of other things that I think I would point to as well, when you try to contrast and compare the buying environment, the buying opportunity that we thought was going to be forthcoming, contrast that to historical cycles in the past, like coming out of the great financial recession in 2008, 2009, that two-year period following that fall off. We bought 9,000 apartments in 2 years. But a lot of that was a function of, if you will, a real recession, real demand fell off considerably. And anytime you have an environment where the demand is really negatively impacted that can really create some distress. And we just haven’t seen that play out this time.
Demand has remained very strong. And I think that has confidence among a lot of merchant builders and banks to have the ability to sort of hang in there because the demand has been so strong. And then secondly, the thing that’s at play here as compared to past cycles where buying opportunities were more plentiful is that there is so much capital on the sidelines now ready to pounce and people know that. And so, I think just the backdrop of strong demand a lot of investor capital ready to jump into multifamily, particularly in the Sun Belt has enabled the markets in pricing to hold up better than what I think some people thought was likely to happen.
Operator: Our next question comes from the line of Linda Tsai with Jefferies. Please go ahead.
Linda Tsai : Just wondering if you’re doing anything differently on the marketing side to drive traffic in the higher supply markets?
Tim Argo : This is Tim. I mean, probably not necessarily anything differently on a market-by-market basis, but we’ve actually updated our website back toward the end of February, which is intended to drive more traffic organically and through to our site as opposed to using some IOSs, which can be quite a bit more expensive. We’re getting more involved in some social media things and that type of thing. But it’s really just trying to drive people and traffic towards our website and really be able to experience what’s there and have a better feel for the community in the neighborhood, and we have everything you want to look at there with floor plans and unit types and all that sort of thing. So, it’s really just continuing to expand how we think about that and how we use technology there as well as getting a little more involved in some of the social media channels.
Linda Tsai: And then along those lines, any automation or efficiency initiatives? Any updates to highlight there?
Tim Argo : Yes. I mean there’s the [indiscernible] that we talked about is something that we think will not only drive down marketing costs but increased demand and the traffic coming in that way. There’s a smart home initiative that we’ve been talking about that we’re wrapping up this year. I mean I think over the next two years, three years, four years, the biggest initiative in terms of what it can do for margin is continuing sort of our ubiquitous or full property WiFi. We have half of our property on a bulk Internet program now. We’ve been doing that for three years or four years, but there’s opportunities for the other half with this even enhanced version of higher margin. I think there’s a $30 million more opportunity there. Just on the part of the portfolio that’s not on bulk. And then I think as we renegotiate some of those existing contracts, there’s huge opportunities there as we look over the next several years.
Operator: We have no further questions. I will return the call to MAA for closing remarks.
Eric Bolton: We appreciate everyone joining us this morning, and feel free to reach out for other questions and see most of you at [indiscernible] I’m sure. Thank you.
Operator: This concludes today’s program. Thank you for your participation. You may disconnect at any time.
