Al Campbell
Executive Vice President and Chief Financial Officer at Mid-America Apartment Communities
Okay. Thank you, Tim, and good morning, everyone. Reported core FFO for the quarter, $2.28 per share was $0.02 per share above the midpoint of our quarterly guidance. The outperformance was primarily driven by favorable interest in overhead costs during the quarter, and a large portion of the overhead cost favorability is timing related with the cost now expected to be incurred in the back half of the year. Overall, same-store operating performance for the quarter was essentially in line with expectations. As Tim mentioned, blended lease pricing continues to outperform original expectations for the year and build stronger-than-expected longer-term revenue but was primarily offset in the second quarter by average occupancy slightly below forecast. Also, as expected, we began to see moderation in same-store operating expense growth during the second quarter with the growth of personnel, repair and maintenance and real estate expenses, tax expenses, excuse me, which combined represents 70% of total operating costs, all reflecting moderation from the prior quarter.
We expect moderation for these items to continue through the remainder of the year, particularly for real estate taxes, which we'll discuss more with guidance in just a moment. As mentioned in the release, our annual property and casualty insurance programs renewed on July 1, and with combined premium increase of approximately 20%, which is in line with our prior guidance. During the quarter, we invested a total of $26.3 million of capital through our redevelopment, repositioning and smart reinstallation programs producing strong returns and adding to the quality of our portfolio. We also funded just over $51 million of development costs during the quarter toward the completion of the current $735 million pipeline, leaving $344 million remaining to be funded. As Brad mentioned, we also expect to start several new deals over the next 12 to 18 months, likely expanding our development pipeline to be closer to $1 billion, which our balance sheet remains well positioned to support. We ended the quarter with $1.4 billion in combined cash and borrowing capacity under our revolving credit facility, providing significant safety and future opportunity. Our leverage remains historically low, the debt-to-EBITDA at 3.4 times, and our debt is currently 100% fixed, for an average of 7.5 years at a record low 3.4%.
We do have $350 million of debt maturing in the fourth quarter but our current plan is to remain patient and allow interest rates and financing markets to continue stabilizing over the next few quarters before refinancing with long-term debt. And finally, given the second quarter's earnings performance and the expectations for the remainder of the year, we are revising our core FFO and several other areas of our guidance previously provided. With the blended pricing outperformance achieved through the second quarter, we are increasing the midpoint of our effective rent growth guidance to 7.25%, a 25 basis points increase. This is offset by a decrease in our physical occupancy guidance, which is now projected to average 95.5% for the full year, a 30 basis points decrease. Though this trade-off support slightly higher rental earning going forward, our total revenue growth guidance for this year remains unchanged at the midpoint of 6.25%. In early July, the Texas state legislature passed the tax overhaul which significantly rolled back property tax rates across the state to effectively redistribute a budget surplus.
Given aggressive property valuations, we had previously anticipated rate rollbacks in Texas, where we have now added a specific reduction for this legislation, which lowers our overall same-store real estate tax growth rate for the year by 50 basis points to 5.75% at the midpoint and that's $0.02 per share to core FFO for the year. There's still limited information regarding exactly how individual counties and municipalities will push this change through but our guidance now includes our early estimate of this overall impact, which is expected to be ongoing. In summary, we are increasing our core FFO projections for the full year to a midpoint of $9.14 per share, which is an increase of $0.03 per share. This increase is primarily comprised of a carry-through of $0.01 per share from the second quarter performance -- outperformance as well as the $0.02 per share addition related to the Texas legislation. As Brad mentioned, we also revised our transaction volume expectations for the current year to reflect current market conditions. So that's all we have in the way of prepared comments. So Aaron, we will now turn the call back to you for any questions.