Eric Bolton, chairman and CEO of apartment REIT MAA (NYSE: MAA), joined REIT.com for a video interview at the St. Regis Hotel in Washington, D.C. during NAREIT’s 2014 Washington Leadership Forum.
Last year MAA merged with Colonial Properties Trust. Bolton was asked to describe the progress of the merger.
“The process is going very well. We’re well into the integration of the back office systems. We expect to have almost all the systems complete by the time we get to late spring, early summer,” Bolton explained.
He added that the integration of property management software has gone smoothly, thanks to the high degree of familiarity that both companies had with each other. “There wasn’t a steep learning curve associated with the integration,” Bolton said.
As for the timing of synergies created by the merger, Bolton stressed that some synergies are already being felt.
“By the time we get to the end of this year, we really expect the run rate of our overhead aggregate expenses to be at the level we forecast when we were putting these two companies together,” he noted. Bolton added that the merged company should be “fully harvesting” all synergy opportunities by 2015.
Bolton stressed that the enhanced credit metrics and increased liquidity created by the merger will create a strong platform for the company over time.
Turning to MAA’s focus on the Sun Belt region of the United States, Bolton expressed optimism for the area’s job growth prospects.
“We believe this region will continue to drive higher levels of job growth than other regions and markets broadly throughout the country,” Bolton said.
And while one of the challenges in the region is the low barrier to supply, Bolton stressed that “there are things we can do to help mitigate some of that risk.” Bolton noted that the company’s diversified markets, scale, operating capability and approach to development are all factors that can help reduce the impact of oversupply.