UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8–K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event
reported): November 4, 2014
CAMPUS CREST COMMUNITIES, INC.
(Exact name of registrant as specified
in its charter)
Maryland
(State or other jurisdiction
of incorporation or organization)
|
001-34872
(Commission File Number) |
27-2481988
(IRS Employer
Identification No.) |
2100 Rexford Road, Suite 414
Charlotte, North Carolina
(Address of principal executive offices) |
|
28211
(Zip Code) |
Registrant’s telephone number, including area code: (704) 496-2500 |
_____________________________________________________________________________
Check the appropriate box below if the Form 8-K filing is intended
to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction
A.2. below):
| ¨ | Written communications pursuant to Rule 425 under the
Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the
Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b)
under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c)
under the Exchange Act (17 CFR 240.13e-4(c)) |
| Item 2.02. | Results of Operations and Financial Condition. |
On November 4, 2014, Campus Crest Communities,
Inc. (the “Company”) issued a press release announcing its results of operations for the three and nine months ended
September 30, 2014. A copy of such press release is furnished as Exhibit 99.1 to this current report. A copy of the Company’s
Third Quarter 2014 Supplemental Analyst Package referenced in such press release is furnished as Exhibit 99.2 to this current report.
The information contained in Item 2.02
of this current report on Form 8-K, including Exhibits 99.1 and 99.2, is furnished pursuant to Item 2.02 of Form 8-K and shall
not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange
Act”) or otherwise subject to the liabilities of that section. Furthermore, the information in Item 2.02 of this current
report on Form 8-K, including Exhibits 99.1 and 99.2, shall not be deemed to be incorporated by reference in the filings of the
registrant under the Securities Act of 1933 (the “Securities Act”).
| Item 2.06. | Material Impairments. |
In connection with the
preparation of its financial statements for the quarter ended September 30, 2014, the Company determined that it would record
impairment charges in an aggregate amount of approximately $122.5 million. These impairment charges consist of approximately $50.9
million for impairment of certain joint ventures due to recognized impairments in investments held in underperforming properties
within the Company's HSRE joint ventures that are being held for sale, as well as an impairment of the Company's Montreal joint
venture as these assets have meaningfully underperformed in their first year of operations resulting in the carrying value of
the investment likely not being recoverable. The Company also recorded impairments of approximately $29.8 million for pre-development
projects that the Company has determined are no longer feasible upon exiting its construction and development business, approximately
$34.0 million associated with the adjustment to the Company’s ownership interests in the Copper Beech portfolio resulting
from the Company’s decision not to exercise the first purchase option to acquire additional interests in the portfolio and
approximately $7.8 million for other various balance sheet items related to corporate infrastructure changes.
| Item 7.01. | Regulation FD Disclosure. |
On November 4, 2014, members of management
of the Company will deliver a presentation in connection with the Company’s earnings release conference call. The presentation
will include a slide presentation, a copy of which is furnished as Exhibit 99.3 to this Current Report on Form 8-K and shall not
be deemed “filed” with the SEC for the purposes of Section 18 of the Exchange Act, nor shall it be deemed incorporated
by reference into any filing made by the Company under the Exchange Act or the Securities Act, except as shall be expressly set
forth by specific reference in such a filing. The Company will also make the presentation available on its website at http://investors.campuscrest.com.
| Item 9.01. | Financial Statements and Exhibits. |
(d) Exhibits. The following exhibits are
filed herewith:
Exhibit |
|
Number |
Description |
|
|
99.1 |
Press release, dated November 4, 2014, issued by Campus Crest Communities, Inc., providing the results of operations for the three and nine months ended September 30, 2014 |
|
|
99.2 |
Campus Crest Communities, Inc. Second Quarter 2014 Supplemental Analyst Package |
|
|
99.3 |
Management Presentation, dated November 4, 2014, by Campus Crest Communities, Inc. |
SIGNATURES
Pursuant to the requirements
of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned
hereunto duly authorized.
|
CAMPUS CREST COMMUNITIES, INC. |
|
|
Date: November 4, 2014 |
/s/ Aaron Halfacre |
|
Aaron Halfacre |
|
Executive Vice President and Chief Investment Officer |
Exhibit Index
Exhibit |
|
Number |
Description |
|
|
99.1 |
Press release, dated November 4, 2014, issued by Campus Crest Communities, Inc., providing the results of operations for the three and nine months ended September 30, 2014 |
|
|
99.2 |
Campus Crest Communities, Inc. Second Quarter 2014 Supplemental Analyst Package |
|
|
99.3 |
Management Presentation, dated November 4, 2014, by Campus Crest Communities, Inc. |
Exhibit 99.1
CCG Announces Change in Management, Copper
Beech Transaction and Strategic Repositioning
Charlotte, NC – November 4, 2014
– Campus Crest Communities, Inc. (NYSE: CCG) (the “Company”), an owner and manager of high-quality student housing
properties, today announced additional changes in senior management, as well as its intent to acquire Copper Beech assets, discontinue
its construction and development business, reduce joint venture exposure and sell non-core assets as part of the Company’s
release of financial results for the three months ended September 30, 2014.
Highlights
Change in Management
| · | Effective immediately, Ted W. Rollins,
Chairman and Chief Executive Officer, has resigned and will no longer be actively involved with the Company. The Independent Directors
of the Board of Directors of the Company have elected Richard Kahlbaugh, lead independent director, as Executive Chairman and Interim
CEO. It is intended that Mr. Kahlbaugh will guide the Company through the completion of its strategic repositioning. |
| · | Effective immediately, Donnie Bobbitt
has resigned and will no longer serve as the Company’s Chief Financial Officer. Mr. Bobbitt will remain as a transition advisor
to the Company reporting to Mr. Kahlbaugh. Scott Rochon has been named acting Chief Financial Officer in addition to his duties
as the Company’s Chief Accounting Officer. |
| · | Aaron Halfacre and Angel Herrera remain
as the Company’s Chief Investment Officer and Chief Operating Officer, respectively. |
Copper Beech Transaction
| · | Entered into an amendment to the Copper
Beech purchase agreement to acquire remaining equity interests in 32 properties in the Copper Beech portfolio; transaction expected
to generate approximately $20 million of incremental net operating income (“NOI”) at an incremental purchase cap rate
of 7.3% based on current share price |
| · | Total consideration of approximately $60.3
million cash, approximately $140.6 million of debt assumption and the issuance of approximately 12.4 million operating partnership
units (“OP units”) |
| · | OP units to be issued at premium to the
current share price and above consensus net asset value |
| · | Achieves full operational control while
also providing scale, diversification and accretion |
| · | Target closing of December 31, 2014 |
Strategic Repositioning
| · | Discontinuing all construction and development
to simplify the business model and focus on organic growth |
| · | Identifying cost savings at the property
and corporate level to enhance profitability |
| · | Reducing joint venture exposure through
select asset dispositions to reduce indebtedness and increase liquidity |
| · | Exploring strategic options for our projects
in Montreal, to include capital solutions to reduce exposure, concurrent with ongoing efforts to drive occupancy |
| · | Marketing development pipeline assets
for sale to increase liquidity and simplify balance sheet |
"Today’s announcement exemplifies
our commitment to our investors. Not only are we completing the Copper Beech transaction on attractive terms, we have also taken
the necessary actions to deliver change," declared the Independent Directors of the Board of Directors of the Company. "After
a thorough and deliberate process, the Board of Directors of the Company have accepted the resignations of Mr. Rollins and Mr.
Bobbitt. We thank them for their years of service and wish them the very best in their future endeavors.”
“The Board of Directors will be working
closely with Aaron, Scott and Angel as we continue the strategic repositioning of Campus Crest,” noted Mr. Kahlbaugh. “As
previously stated, our initiatives for change include a focus on operations to deliver organic growth, instilling a disciplined
approach to capital allocation, manifesting meaningful cost savings across our organization and bringing about thoughtful balance
sheet improvements. We look forward to providing more information in the weeks and months ahead.”
“We are proactively taking the steps
necessary to restore investor confidence and are intently focused on improving shareholder value. We thank our investors for their
continued support.” said Aaron Halfacre.
Financial Results for the Three and
Nine Months Ended September 30, 2014
For the three and nine months ended September
30, 2014, Funds From Operations (“FFO”) and FFOA are shown in the table below.
FFO/FFOA | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| |
| |
Three Months Ended September 30, | | |
Nine Months Ended September 30, | |
($mm, except per share) | |
2014 | | |
Per share -
diluted | | |
2013 | | |
Per share -
diluted | | |
2014 | | |
Per share -
diluted | | |
2013 | | |
Per share -
diluted | |
| |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| |
FFO | |
($ | 118.9 | ) | |
($ | 1.84 | ) | |
$ | 14.1 | | |
$ | 0.22 | | |
($ | 96.2 | ) | |
($ | 1.49 | ) | |
$ | 35.0 | | |
$ | 0.60 | |
FFOA1 | |
$ | 9.7 | | |
$ | 0.15 | | |
$ | 13.1 | | |
$ | 0.20 | | |
$ | 28.2 | | |
$ | 0.44 | | |
$ | 31.9 | | |
$ | 0.55 | |
1 Includes eliminations for the write-off of transaction
costs, the fair value adjustments of Copper Beech debt, restructuring related charges, asset impairments, and other charges as
reflected in the Q3 2014 Supplemental Analyst Package.
A reconciliation of net income attributable
to common stockholders to FFO and to FFOA can be found at the end of this release.
For the three months ended September 30,
2014, the Company reported total revenues of $28.3 million and net income (loss) attributable to common stockholders of ($130.0)
million as a result of the Company’s strategic repositioning, compared to $23.3 million and $3.7 million, respectively, in
the same period in 2013. Please see Balance Sheet Impairments and Condensed Consolidated Statement of Operations for further details
below.
Operating Results
For the three and nine months ended September
30, 2014, results for wholly owned same store properties were as follows:
Same Store Results | |
| | |
| | |
| | |
| | |
| | |
| |
| |
Three Months Ended September 30, | | |
Nine Months Ended September 30, | |
($mm) | |
2014 | | |
2013 | | |
Change | | |
2014 | | |
2013 | | |
Change | |
| |
| | |
| | |
| | |
| | |
| | |
| |
Number of Assets | |
| 28 | | |
| 28 | | |
| | | |
| 28 | | |
| 28 | | |
| | |
Number of Beds | |
| 14,920 | | |
| 14,920 | | |
| | | |
| 14,920 | | |
| 14,920 | | |
| | |
Occupancy | |
| 90.0 | % | |
| 91.5 | % | |
| (150) bps | | |
| 90.2 | % | |
| 92.5 | % | |
| (230) bps | |
Total Revenues | |
$ | 20.9 | | |
$ | 21.1 | | |
| (1.1 | %) | |
$ | 62.7 | | |
$ | 64.1 | | |
| (2.2 | %) |
NOI | |
$ | 10.5 | | |
$ | 11.4 | | |
| (7.8 | %) | |
$ | 33.5 | | |
$ | 35.4 | | |
| (5.5 | %) |
NOI Margin | |
| 50.4 | % | |
| 54.1 | % | |
| (370) bps | | |
| 53.4 | % | |
| 55.2 | % | |
| (180) bps | |
The year-over-year results reflect the
Company’s improved tenant underwriting processes implemented for the 2014/2015 academic leasing year. These improvements
are designed to better reflect in-place economic occupancy and minimize quarter-over-quarter volatility on a go-forward basis.
NOI margin is calculated by dividing NOI
for the period by total student housing rental and services revenues for the period. A reconciliation of net income attributable
to common stockholders to NOI can be found at the end of this release. In addition, details regarding same store NOI and calculations
thereof may be found in the Supplemental Analyst Package located at http://investors.campuscrest.com/.
Portfolio Information
As of September 30, 2014, the Company owned
interests in 86 properties totaling approximately 46,682 beds across North America. A summary of the leasing for the 2014/2015
academic year follows:
2014/2015
Academic Year Leasing Summary | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| |
| |
| | |
| | |
2013-2014 | | |
2014-2015 | | |
| | |
Rental
Rate | |
Category | |
Properties | | |
Beds | | |
Signed1 | | |
% | | |
Actual2 | | |
% | | |
Forecast3 | | |
% | | |
Change4 | | |
Change5 | |
| |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| |
Operating Properties By Ownership | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Wholly Owned | |
| 32 | | |
| 17,476 | | |
| 16,048 | | |
| 91.8 | % | |
| 15,861 | | |
| 90.8 | % | |
| 16,100 | | |
| 92.1 | % | |
| 1.3 | % | |
| 2.0 | % |
Joint Venture | |
| 9 | | |
| 5,148 | | |
| 4,197 | | |
| 81.5 | % | |
| 4,141 | | |
| 80.4 | % | |
| 4,110 | | |
| 79.8 | % | |
| (0.6 | %) | |
| 2.7 | % |
Copper Beech | |
| 35 | | |
| 16,647 | | |
| 15,082 | | |
| 90.6 | % | |
| 15,080 | | |
| 90.6 | % | |
| 15,592 | | |
| 93.7 | % | |
| 3.1 | % | |
| 0.2 | % |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Total Operating
Properties | |
| 76 | | |
| 39,271 | | |
| 35,327 | | |
| 90.0 | % | |
| 35,082 | | |
| 89.3 | % | |
| 35,802 | | |
| 91.2 | % | |
| 1.9 | % | |
| 1.3 | % |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Total 2014
Deliveries | |
| 10 | | |
| 7,411 | | |
| n/a | | |
| n/a | | |
| n/a | | |
| n/a | | |
| 3,814 | | |
| 51.5 | % | |
| n/a | | |
| n/a | |
Footnotes:
1) Total signed leases as of September 30, 2013, as reported
in October 1, 2013 press release
2) Actual physical occupancy during the 2013/2014 academic year
3) Forecast 2014/2105 physical occupancy based on leases signed
as of September 30, 2014 and projected tenant attrition
4) Year over year change in occupancy based on actual 2013/2014
and forecast 2014/2015
5) Forecast rental rate change for the 2014-2015 academic year
over the 2013-2014 academic achieved rental RevPOB
Balance Sheet Impairments
The Company’s strategic repositioning
resulted in impairments to the balance sheet as of September 30, 2014, and can be broadly associated with the following three categories:
Discontinued development –
The Company’s exit from the construction and development business triggered the write-off of unrecoverable pre-development
costs and adjustments to the carrying values of land parcels now being held for sale. Other related charges include severance and
corporate infrastructure changes.
Reduced joint venture exposure –
The Company has recognized impairments to its investments held in underperforming properties within our HSRE joint ventures. Additionally,
an impairment of our Montreal joint venture has been taken in recognition that the full value of the investment may not be recoverable.
Effects of not exercising Copper Beech
purchase option – A one-time non-cash accounting charge associated with the third quarter 2014 shift in the Company’s
pro-rata economic ownership interest in the Copper Beech assets.
A summary of all balance sheet impairments
follows:
Balance Sheet Impairments | |
| |
($mm) | |
Adjustment | |
| |
| |
Impairment of land & predevelopment costs | |
$ | 29,790 | |
Write off of corporate other assets | |
| 7,765 | |
Impairment of unconsolidated entities | |
| 50,866 | |
Effect of not exercising Copper Beech purchase option | |
| 34,048 | |
| |
| | |
Total | |
$ | 122,469 | |
| |
| | |
Capital Markets Activity and Liquidity
As of September
30, 2014, the Company had not sold any shares under its $100.0 million At-the-Market common equity
offering program. The Company had $18.3 million of cash, $6.2 million of restricted cash and net availability under its revolving
credit facility of $70.8 million as of September 30, 2014.
2014 Earnings Guidance and Dividends
Based on the Copper Beech transaction and
the strategic repositioning announced today, the Company has withdrawn 2014 earnings guidance to allow sufficient time to complete
forecast revisions.
The Company announced that its Board of
Directors has declared its intent to lower the common stock dividend upon final review of forecast revisions; the fourth quarter
dividend will be announced in December.
Conference Call Details
The Company will host a conference call
on Tuesday, November 4, 2014, at 9:00 a.m. (EST) to discuss the financial results.
The call can be accessed live over the
phone by dialing 877-407-0789, or for international callers, 201-689-8562. A replay will be available shortly after the call and
can be accessed by dialing 877-870-5176, or for international callers, 858-384-5517. The pin number for the replay is 13594808.
The replay will be available until November 11, 2014.
Interested parties may also listen to
a simultaneous webcast of the conference call by logging onto the Company's website at http://investors.campuscrest.com/.
A recording of the call will also be available on the Company's website following the call.
Supplemental Schedules
The Company has published a Supplemental
Analyst Package in order to provide additional disclosure and financial information for the benefit of the Company’s
stakeholders. These can be found under the “Earnings Center” tab in the Investors section of the Company’s web
site at http://www.campuscrest.com/.
About Campus Crest Communities, Inc.
Campus
Crest Communities, Inc. is a leading owner and manager of high-quality student housing properties located close to college campuses
in targeted markets. It has ownership interests in 86 student housing properties with over 46,000 beds across North America. Additional
information can be found on the Company's website at http://www.campuscrest.com.
Forward-Looking Statements
This press release, together with other
statements and information publicly disseminated by the Company, contains certain forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The
Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained
in the Private Securities Litigation Reform Act of 1995 and includes this statement for purposes of complying with these safe harbor
provisions. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events
or trends and similar expressions concerning matters that are not historical facts. In some cases, you can identify forward-looking
statements by the use of forward-looking terminology such as “may,” “will,” “should,” “expects,”
“intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts”
or “potential” or the negative of these words and phrases or similar words or phrases which are predictions of or indicate
future events or trends and which do not relate solely to historical matters. Forward-looking statements in this press release
include, among others, the performance of properties in occupancy and yield targets, outlook and guidance for full-year 2014 FFOA
and the related underlying assumptions, growth and development opportunities, leasing activities, financing strategies, and development
and construction projects. You should not rely on forward-looking statements since they involve known and unknown risks, uncertainties,
assumptions and contingencies, many of which are beyond the Company’s control that may cause actual results to differ significantly
from those expressed in any forward-looking statement. All forward-looking statements reflect the Company’s good faith beliefs,
assumptions and expectations, but they are not guarantees of future performance. Furthermore, except as otherwise required by federal
securities laws, the Company disclaims any obligation to publicly update or revise any forward-looking statement to reflect changes
in underlying assumptions or factors, new information, data or methods, future events or other changes. For a further discussion
of these and other factors that could cause the Company’s future results to differ materially from any forward-looking statements,
see the risk factors discussed in the Company’s most recent Annual Report on Form 10-K, as updated in the Company’s
Quarterly Reports on Form 10-Q.
Contact:
Investor Relations
(704) 496-2571
Investor.Relations@CampusCrest.com
CAMPUS CREST COMMUNITIES |
|
|
CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) |
(in $000s) |
| |
| | |
| |
| |
September 30, | | |
December 31, | |
| |
2014 | | |
2013 | |
| |
| | |
| |
Assets | |
| | | |
| | |
Investment in real estate, net: | |
| | | |
| | |
Student housing properties | |
$ | 923,531 | | |
$ | 716,285 | |
Accumulated depreciation | |
| (120,121 | ) | |
| (102,356 | ) |
Development in process | |
| 19,802 | | |
| 91,184 | |
Investment in real estate, net | |
| 823,212 | | |
| 705,113 | |
Investment in unconsolidated entities1 | |
| 275,040 | | |
| 324,838 | |
Cash and cash equivalents | |
| 18,313 | | |
| 32,054 | |
Restricted cash 2 | |
| 6,207 | | |
| 32,636 | |
Student receivables, net | |
| 2,802 | | |
| 2,825 | |
Cost and earnings in excess of construction billings | |
| 24,449 | | |
| 42,803 | |
Other assets, net | |
| 46,796 | | |
| 42,410 | |
Total assets | |
$ | 1,196,819 | | |
$ | 1,182,679 | |
| |
| | | |
| | |
Liabilities and equity | |
| | | |
| | |
Liabilities: | |
| | | |
| | |
Mortgage and construction loans | |
$ | 279,152 | | |
$ | 205,531 | |
Line of credit and other debt | |
| 301,122 | | |
| 207,952 | |
Accounts payable and accrued expenses | |
| 69,902 | | |
| 62,448 | |
Construction billings in excess of cost and earnings | |
| 8 | | |
| 600 | |
Other liabilities | |
| 18,768 | | |
| 11,167 | |
Total liabilities | |
| 668,952 | | |
| 487,698 | |
Equity: | |
| | | |
| | |
Preferred stock | |
$ | 61 | | |
$ | 61 | |
Common stock | |
| 648 | | |
| 645 | |
Additional common and preferred paid-in capital | |
| 776,605 | | |
| 773,896 | |
Accumulated deficit and distributions | |
| (256,377 | ) | |
| (84,143 | ) |
Accumulated other comprehensive loss | |
| (1,451 | ) | |
| (71 | ) |
Total stockholders' equity | |
| 519,486 | | |
| 690,388 | |
Noncontrolling interests | |
| 8,381 | | |
| 4,593 | |
Total equity | |
| 527,867 | | |
| 694,981 | |
Total liabilities and equity | |
$ | 1,196,819 | | |
$ | 1,182,679 | |
| |
| | | |
| | |
1 As of December 31, 2013, includes the Company’s
investment in Copper Beech equating to a 67% effective ownership interest in 30 properties, of which 28 are operating and two
are non-operating properties. On August 18, 2014, the Company elected to not exercise the first purchase option and reverted to
a 48% interest ownership interest in 35 operating properties. As of September 30, 2014, the Company held a 48% effective interest
in 35 operating and two non-operating properties which are unconsolidated and a 48% interest in one consolidated operating property.
2 As of September 30, 2014 and December 31, 2013,
includes approximately $0 and $28,200, respectively, of cash held in escrow from the sale of four wholly-owned Grove-branded student
housing properties on December 27, 2013.
CAMPUS CREST COMMUNITIES |
|
|
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) |
(in $000s, except per share data) |
| |
| | |
| |
| |
Three
Months Ended September 30, | | |
Nine
Months Ended September 30, | |
| |
2014 | | |
2013 | | |
$
Change | | |
2014 | | |
2013 | | |
$
Change | |
| |
| | |
| | |
| | |
| | |
| | |
| |
Revenues: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Student housing rental | |
$ | 26,985 | | |
$ | 22,165 | | |
$ | 4,820 | | |
$ | 74,256 | | |
$ | 64,118 | | |
$ | 10,138 | |
Student housing services | |
| 1,043 | | |
| 867 | | |
| 176 | | |
| 3,043 | | |
| 2,645 | | |
| 398 | |
Property management services | |
| 281 | | |
| 225 | | |
| 56 | | |
| 711 | | |
| 539 | | |
| 172 | |
Total revenues | |
| 28,309 | | |
| 23,257 | | |
| 5,052 | | |
| 78,010 | | |
| 67,302 | | |
| 10,708 | |
Operating expenses: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Student housing operations | |
| 12,368 | | |
| 9,923 | | |
| 2,445 | | |
| 33,728 | | |
| 29,341 | | |
| 4,387 | |
General and administrative1 | |
| 4,043 | | |
| 2,424 | | |
| 1,619 | | |
| 11,198 | | |
| 8,076 | | |
| 3,122 | |
Impairment of land & predevelopment costs | |
| 29,790 | | |
| - | | |
| 29,790 | | |
| 29,790 | | |
| - | | |
| 29,790 | |
Write-off of corporate other assets | |
| 7,765 | | |
| - | | |
| 7,765 | | |
| 7,765 | | |
| - | | |
| 7,765 | |
Transaction costs2 | |
| 286 | | |
| 247 | | |
| 39 | | |
| 2,331 | | |
| 835 | | |
| 1,496 | |
Ground leases | |
| 120 | | |
| 54 | | |
| 66 | | |
| 357 | | |
| 162 | | |
| 195 | |
Depreciation and amortization | |
| 7,035 | | |
| 5,581 | | |
| 1,454 | | |
| 21,269 | | |
| 17,154 | | |
| 4,115 | |
Total operating expenses | |
| 61,407 | | |
| 18,229 | | |
| 43,178 | | |
| 106,438 | | |
| 55,568 | | |
| 50,870 | |
Equity in earnings (loss) of unconsolidated
entities3,4 | |
| 635 | | |
| 1,302 | | |
| (667 | ) | |
| 63 | | |
| 3,608 | | |
| (3,545 | ) |
Impairment of unconsolidated entities | |
| (50,866 | ) | |
| - | | |
| (50,866 | ) | |
| (50,866 | ) | |
| - | | |
| (50,866 | ) |
Effect of not exercising Copper Beech purchase
option | |
| (34,048 | ) | |
| - | | |
| (34,048 | ) | |
| (34,048 | ) | |
| - | | |
| (34,048 | ) |
Operating income | |
| (117,377 | ) | |
| 6,330 | | |
| (123,707 | ) | |
| (113,279 | ) | |
| 15,342 | | |
| (128,621 | ) |
Nonoperating income (expense): | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Interest expense, net | |
| (3,639 | ) | |
| (3,091 | ) | |
| (548 | ) | |
| (9,965 | ) | |
| (8,764 | ) | |
| (1,201 | ) |
Other
income (expense)5 | |
| (41 | ) | |
| 696 | | |
| (737 | ) | |
| 129 | | |
| 1,421 | | |
| (1,292 | ) |
Total nonoperating expense,
net | |
| (3,680 | ) | |
| (2,395 | ) | |
| (1,285 | ) | |
| (9,836 | ) | |
| (7,343 | ) | |
| (2,493 | ) |
Net income before income tax benefit (expense) | |
| (121,057 | ) | |
| 3,935 | | |
| (124,992 | ) | |
| (123,115 | ) | |
| 7,999 | | |
| (131,114 | ) |
Income tax benefit (expense) | |
| (1,131 | ) | |
| (40 | ) | |
| (1,091 | ) | |
| (731 | ) | |
| 306 | | |
| (1,037 | ) |
Income from continuing operations | |
| (122,188 | ) | |
| 3,895 | | |
| (126,083 | ) | |
| (123,846 | ) | |
| 8,305 | | |
| (132,151 | ) |
Income (loss) from discontinued operations | |
| (5,506 | ) | |
| 958 | | |
| (6,464 | ) | |
| (3,191 | ) | |
| 2,655 | | |
| (5,846 | ) |
Net income (loss) | |
| (127,694 | ) | |
| 4,853 | | |
| (132,547 | ) | |
| (127,037 | ) | |
| 10,960 | | |
| (137,997 | ) |
Dividends on preferred stock | |
| 3,050 | | |
| 1,150 | | |
| 1,900 | | |
| 9,150 | | |
| 3,450 | | |
| 5,700 | |
Net income (loss) attributable to noncontrolling
interests | |
| (770 | ) | |
| 26 | | |
| (796 | ) | |
| (773 | ) | |
| 51 | | |
| (824 | ) |
Net income (loss) attributable
to common stockholders | |
($ | 129,974 | ) | |
$ | 3,677 | | |
($ | 133,651 | ) | |
($ | 135,414 | ) | |
$ | 7,459 | | |
($ | 142,873 | ) |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Per share data - basic and diluted: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Income (loss) from continuing operations attributable
to common stockholders | |
($ | 1.92 | ) | |
$ | 0.05 | | |
| | | |
($ | 2.04 | ) | |
$ | 0.08 | | |
| | |
Income (loss) from discontinued
operations attributable to common stockholders | |
($ | 0.09 | ) | |
$ | 0.01 | | |
| | | |
($ | 0.05 | ) | |
$ | 0.05 | | |
| | |
Net income (loss) per share attributable to common
stockholders | |
($ | 2.01 | ) | |
$ | 0.06 | | |
| | | |
($ | 2.09 | ) | |
$ | 0.13 | | |
| | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Weighted average common shares outstanding: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Basic | |
| 64,770 | | |
| 64,518 | | |
| | | |
| 64,650 | | |
| 58,461 | | |
| | |
Diluted | |
| 65,204 | | |
| 64,953 | | |
| | | |
| 65,084 | | |
| 58,896 | | |
| | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
1 For three and nine months ended September 30, 2014,
includes $720 of severance costs.
2 For the three and nine months ended September 30,
2014, includes $286 and $2,331, respectively, of transaction costs related to Copper Beech, the Montreal investments and other
transaction costs. Additionally, for the three and nine months ended September 30, 2013, includes $247 and $835, respectively,
of transaction costs related to Copper Beech.
3 For the three and nine months ended September 30,
2014 and the period from March 18, 2013 to September 30, 2013, includes results from the Company’s investment in Copper Beech.
The Company made its initial investment on March 18, 2013 and subsequently made additional investments. On September 30, 2013,
the Company entered into an amendment to the purchase and sale agreement that, subject to receipt of required third-party lender
consents, enabled the Company to acquire a 67% ownership interest in 28 operating properties, while deferring ownership in seven
properties until the Company exercises future purchase options. On August 18, 2014, the Company elected to not exercise the first
purchase option and reverted to a 48% interest ownership interest in 35 operating properties. As of September 30, 2014, the Company
held a 48% effective interest in 35 operating and two non-operating properties which are unconsolidated and a 48% interest in one
consolidated operating property.
4 For the three and nine months ended September 30,
2014, includes $1,539 and $5,058, respectively, of fair value adjustment related to Copper Beech's debt. For the three and nine
months ended September 30, 2013, includes $1,220 and $2,165, respectively, of fair value adjustment related to Copper Beech's debt.
5 For the three and nine months ended September 30,
2013, includes interest income from the 8.5%, $31,700 loan made to existing investors in Copper Beech on March 18, 2013. In conjunction
with the September 30, 2013 amendment to the purchase and sale agreement, the $31,700 loan was repaid by Copper Beech.
CAMPUS CREST COMMUNITIES |
|
|
RECONCILIATION OF NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS TO FUNDS FROM OPERATIONS ("FFO"), FUNDS FROM OPERATIONS ADJUSTED ("FFOA") & NET OPERATING INCOME ("NOI") (unaudited) |
(in $000s, except per share data) |
| |
| | |
| |
| |
Three
Months Ended September 30, | | |
Nine
Months Ended September 30, | |
| |
2014 | | |
2013 | | |
$
Change | | |
2014 | | |
2013 | | |
$
Change | |
| |
| | |
| | |
| | |
| | |
| | |
| |
Net income (loss) attributable to common stockholders | |
($ | 129,974 | ) | |
$ | 3,677 | | |
($ | 133,651 | ) | |
($ | 135,414 | ) | |
$ | 7,459 | | |
($ | 142,873 | ) |
Net income (loss) attributable to noncontrolling interests | |
| (770 | ) | |
| 26 | | |
| (796 | ) | |
| (773 | ) | |
| 51 | | |
| (824 | ) |
Real estate related depreciation and amortization | |
| 6,590 | | |
| 5,341 | | |
| 1,249 | | |
| 20,175 | | |
| 16,523 | | |
| 3,652 | |
Real estate related depreciation and amortization - discontinued
operations | |
| - | | |
| 545 | | |
| (545 | ) | |
| - | | |
| 2,070 | | |
| (2,070 | ) |
Real estate related depreciation and amortization
- unconsolidated entities | |
| 5,259 | | |
| 4,487 | | |
| 772 | | |
| 19,856 | | |
| 8,917 | | |
| 10,939 | |
FFO available to
common shares and OP units1, 2, 3 | |
| (118,895 | ) | |
| 14,076 | | |
| (132,971 | ) | |
| (96,156 | ) | |
| 35,020 | | |
| (131,176 | ) |
Elimination of the following: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Transaction costs | |
| 286 | | |
| 1,153 | | |
| (867 | ) | |
| 2,331 | | |
| 1,741 | | |
| 590 | |
Impairment of land & predevelopment costs | |
| 29,790 | | |
| - | | |
| 29,790 | | |
| 29,790 | | |
| - | | |
| 29,790 | |
Write off of corporate other assets | |
| 7,765 | | |
| - | | |
| 7,765 | | |
| 7,765 | | |
| - | | |
| 7,765 | |
Severance | |
| 720 | | |
| - | | |
| 720 | | |
| 720 | | |
| - | | |
| 720 | |
Change in valuation allowance for deferred tax
asset | |
| 1,131 | | |
| - | | |
| 1,131 | | |
| 731 | | |
| - | | |
| 731 | |
Discontinued operations | |
| 5,506 | | |
| (958 | ) | |
| 6,464 | | |
| 3,191 | | |
| (2,655 | ) | |
| 5,846 | |
Impairment of unconsolidated entities | |
| 50,866 | | |
| - | | |
| 50,866 | | |
| 50,866 | | |
| - | | |
| 50,866 | |
Effect of not exercising Copper Beech purchase
option | |
| 34,048 | | |
| - | | |
| 34,048 | | |
| 34,048 | | |
| - | | |
| 34,048 | |
FV adjustment of CB debt | |
| (1,539 | ) | |
| (1,220 | ) | |
| (319 | ) | |
| (5,058 | ) | |
| (2,165 | ) | |
| (2,893 | ) |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Funds
from operations adjusted (FFOA) available to common shares and OP units | |
$ | 9,678 | | |
$ | 13,051 | | |
($ | 3,373 | ) | |
$ | 28,228 | | |
$ | 31,941 | | |
($ | 3,713 | ) |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
FFO per share - diluted1, 2, 3 | |
($ | 1.84 | ) | |
$ | 0.22 | | |
($ | 2.06 | ) | |
($ | 1.49 | ) | |
$ | 0.60 | | |
($ | 2.09 | ) |
FFOA per share - diluted | |
$ | 0.15 | | |
$ | 0.20 | | |
($ | 0.05 | ) | |
$ | 0.44 | | |
$ | 0.55 | | |
($ | 0.11 | ) |
Weighted average common shares and OP units
outstanding - basic/dilutive4 | |
| 64,770 | | |
| 64,518 | | |
| | | |
| 64,650 | | |
| 58,461 | | |
| | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| |
| | |
| |
| |
Three
Months Ended September 30, | | |
Nine
Months Ended September 30, | |
| |
20141 | | |
20131 | | |
20141 | | |
20131 | |
| |
| | |
| | |
| | |
| |
Net income (Loss) attributable to common stockholders | |
($ | 129,974 | ) | |
$ | 3,677 | | |
($ | 135,414 | ) | |
$ | 7,459 | |
Net income (Loss) attributable to noncontrolling interests | |
| (770 | ) | |
| 26 | | |
| (773 | ) | |
| 51 | |
Preferred stock dividends | |
| 3,050 | | |
| 1,150 | | |
| 9,150 | | |
| 3,450 | |
Income tax (benefit) expense | |
| 1,131 | | |
| 40 | | |
| 731 | | |
| (306 | ) |
Other (income) expense | |
| 41 | | |
| (696 | ) | |
| (129 | ) | |
| (1,348 | ) |
(Income) loss on discontinued operations | |
| 5,506 | | |
| (958 | ) | |
| 3,191 | | |
| (2,655 | ) |
Interest expense | |
| 3,639 | | |
| 3,091 | | |
| 9,965 | | |
| 8,764 | |
Equity in earnings of unconsolidated entities | |
| (635 | ) | |
| (1,302 | ) | |
| (63 | ) | |
| (3,608 | ) |
Depreciation and amortization | |
| 7,035 | | |
| 5,581 | | |
| 21,269 | | |
| 17,154 | |
Ground lease expense | |
| 120 | | |
| 54 | | |
| 357 | | |
| 162 | |
General and administrative expense5 | |
| 4,043 | | |
| 2,424 | | |
| 11,198 | | |
| 8,076 | |
Impairment of unconsolidated entities | |
| 50,866 | | |
| - | | |
| 50,866 | | |
| - | |
Effect of not exercising Copper Beech purchase option | |
| 34,048 | | |
| - | | |
| 34,048 | | |
| - | |
Impairment of land & predevelopment costs | |
| 29,790 | | |
| - | | |
| 29,790 | | |
| - | |
Write-off of corporate other assets | |
| 7,765 | | |
| - | | |
| 7,765 | | |
| - | |
Transaction costs | |
| 286 | | |
| 247 | | |
| 2,331 | | |
| 835 | |
Property management services | |
| (281 | ) | |
| (225 | ) | |
| (711 | ) | |
| (539 | ) |
Total NOI | |
$ | 15,660 | | |
$ | 13,109 | | |
$ | 43,571 | | |
$ | 37,495 | |
Same
store properties NOI6 | |
$ | 10,525 | | |
$ | 11,424 | | |
$ | 33,461 | | |
$ | 35,412 | |
New
properties NOI6,7 | |
$ | 4,259 | | |
$ | 1,224 | | |
$ | 7,743 | | |
$ | 1,255 | |
The
Grove at Pullman & Toledo NOI8 | |
$ | 876 | | |
$ | 461 | | |
$ | 2,367 | | |
$ | 755 | |
| |
| | | |
| | | |
| | | |
| | |
1 For the three and nine months ended September 30,
2014 and the period March 18, 2013 to June 30, 2013, includes results from the Company’s investment in Copper Beech. The
Company made its initial investment on March 18, 2013 and subsequently made additional investments. On September 30, 2013, the
Company entered into an amendment to the purchase and sale agreement that, subject to receipt of required third-party lender consents,
enabled the Company to acquire a 67% ownership interest in 28 operating properties, while deferring ownership in seven properties
until the Company exercises future purchase options. On August 18, 2014, the Company elected to not exercise the first purchase
option and reverted to a 48% interest ownership interest in 35 operating properties. As of September 30, 2014, the Company held
a 48% effective interest in 35 operating and two non-operating properties which are unconsolidated and a 48% interest in one consolidated
operating property.
2 For the three and nine months ended September 30,
2014, includes $286 and $2,331, respectively, of transaction costs related to Copper Beech, the Montreal investments and other
transaction costs. Additionally, for the three and nine months ended September 30, 2013, includes $247 and $835, respectively,
of transaction costs related to Copper Beech.
3 For the three and nine months ended September 30,
2014, includes $1,539 and $5,058, respectively, of fair value adjustment related to Copper Beech's debt. For the three and nine
months ended September 30, 2013, includes $1,220 and $2,165, respectively, of fair value adjustment related to Copper Beech's debt.
4 For the three and nine months ended September 30,
2014, the basic shares were used to calculate FFO and FFOA as the dilutive shares would have been anti-dilutive. For the three
and nine months ended September 30, 2013, the dilutive shares were used to calculate FFO and FFOA.
5For three and nine months ended September 30, 2014,
includes $720 of severance costs.
6 "Same store" properties are our wholly-owned
operating properties acquired or placed in-service prior to the beginning of the earliest period presented and owned by us and
remaining in service through the end of the latest period presented or period being analyzed. "New properties" are our
wholly-owned operating properties that we acquired or placed in service after the beginning of the earliest period presented or
period being analyzed.
7 Includes NOI contribution from Copper Beech at
Ames. This is a consolidated joint venture.
8 Includes NOI contribution from the operations of
The Grove at Pullman and the Toledo, OH redevelopment, as well as business interruption insurance proceeds from The Grove at Pullman.
Non-GAAP Financial Measures
FFO and FFOA
FFO is a non-GAAP financial measure. We
calculate FFO in accordance with the definition that was adopted by the Board of Governors of NAREIT. FFO, as defined by NAREIT,
represents net income (loss) determined in accordance with U.S. GAAP, excluding extraordinary items as defined under GAAP and gains
or losses from sales of previously depreciated operating real estate assets, plus specified non-cash items, such as real estate
asset depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. In addition, in
October 2011, NAREIT communicated to its members that the exclusion of impairment write-downs of depreciable real estate is consistent
with the definition of FFO.
We use FFO as a supplemental performance
measure because, in excluding real estate-related depreciation and amortization and gains and losses from property dispositions,
it provides a performance measure that, when compared year over year, captures trends in occupancy rates, rental rates and operating
expenses. We also believe that, as a widely recognized measure of the performance of equity REITs, FFO will be used by investors
as a basis to compare our operating performance with that of other REITs. However, because FFO excludes depreciation and amortization
and captures neither the changes in the value of our properties that result from use or market conditions nor the level of capital
expenditures necessary to maintain the operating performance of our properties, all of which have real economic effects and could
materially and adversely impact our results of operations, the utility of FFO as a measure of our performance is limited.
While FFO is a relevant and widely used
measure of operating performance of equity REITs, other equity REITs may use different methodologies for calculating FFO and, accordingly,
FFO as disclosed by such other REITs may not be comparable to FFO published herein. Therefore, we believe that in order to facilitate
a clear understanding of our historical operating results, FFO should be examined in conjunction with net income (loss) (computed
in accordance with U.S. GAAP) as presented in the consolidated financial statements included elsewhere in this document. FFO should
not be considered as an alternative to net income (loss) (computed in accordance with U.S. GAAP) as an indicator of our properties’
financial performance or to cash flow from operating activities (computed in accordance with U.S. GAAP) as an indicator of our
liquidity, nor is it indicative of funds available to fund our cash needs, including our ability to pay dividends or make distributions.
FFOA is a non-GAAP financial measure. In
addition to FFO, we believe it is also a meaningful measure of our performance to adjust FFO to exclude the write-off of unamortized
deferred financing fees, transaction costs, impairments, severance, discontinued operations, the effect of not exercising the Copper
Beech purchase option, the write-off of development cost and fair value debt adjustments on equity method investments. Excluding
the write-off of unamortized deferred financing fees, transaction costs, impairments, severance, discontinued operations, the effect
of not exercising the Copper Beech purchase option, the write-off of development cost, and fair value debt adjustments on equity
method investments adjusts FFO to be more reflective of operating results prior to capital replacement or expansion, debt service
obligations or other commitments and contingencies.
NOI
NOI is a non-GAAP financial measure. We
calculate NOI by adding back (or subtracting from) to net income (loss) attributable to common stockholders the following expenses
or charges: income tax expense, interest expense, equity in loss of unconsolidated entities, preferred stock dividends, depreciation
and amortization, transaction costs, ground lease expense, general and administrative expense and development, construction and
management services expense. The following income or gains are then deducted from net income (loss) attributable to common stockholders,
adjusted for add backs of expenses or charges: equity in earnings of unconsolidated entities, income tax benefit, other income,
and development, construction and management services revenue. We believe these adjustments help provide a performance measure,
when compared year over year, that illustrates the operating results of our wholly-owned properties and captures trends in student
housing rental and services income and student housing operating expenses.
NOI excludes multiple components of net
income (loss) (computed in accordance with U.S. GAAP) and captures neither the changes in the value of our properties that result
from use or market conditions nor the level of capital expenditures necessary to maintain the operating performance of our properties,
all of which have real economic effects and could materially and adversely impact our results of operations. Therefore, the utility
of NOI as a measure of our performance is limited. Additionally, other companies, including other equity REITs, may use different
methodologies for calculating NOI and, accordingly, NOI as disclosed by such other companies may not be comparable to NOI published
herein. Therefore, we believe that in order to facilitate a clear understanding of our historical operating results, NOI should
be examined in conjunction with net income (loss) (computed in accordance with U.S. GAAP) as presented in the consolidated financial
statements included elsewhere in this document. NOI should not be considered as an alternative to net income (loss) (computed in
accordance with U.S. GAAP) as an indicator of our properties’ financial performance or to cash flow from operating activities
(computed in accordance with U.S. GAAP) as an indicator of our liquidity, nor is it indicative of funds available to fund our cash
needs, including our ability to pay dividends or make distributions.
Exhibit 99.2
Third Quarter 2014
Supplemental Analyst Package
Contact:
Investor Relations
704-496-2571
Investor.Relations@CampusCrest.com
THIRD QUARTER 2014
SUPPLEMENTAL ANALYST PACKAGE
TABLE OF CONTENTS
Financial Highlights |
3 |
|
|
Condensed Consolidated Balance Sheets |
4 |
|
|
Condensed Consolidated Statements of Operations |
5 |
|
|
Reconciliation of Net Income (Loss) Attributable to Common Stockholders to FFO, FFOA and Net Operating Income |
6 |
|
|
Wholly Owned Property Results of Operations |
7 |
|
|
LTM Wholly Owned Property Results of Operations |
8 |
|
|
Same Store Wholly Owned Property Operating Expenses |
9 |
|
|
HSRE, Beaumont and Copper Beech Joint Venture Property Results of Operations |
10 |
|
|
Capital Structure as of September 30, 2014 |
11 |
|
|
Outstanding Debt and Maturity Schedule |
12 |
|
|
HSRE & Beaumont Joint Venture Debt Summary |
13 |
|
|
Copper Beech Joint Venture Debt Summary |
14 |
|
|
Portfolio Overview and Occupancy |
15 - 16 |
|
|
Copper Beech Portfolio Overview and Occupancy |
17 |
|
|
Investor Information |
18 |
|
|
Forward-Looking Statements |
19 |
CAMPUS
CREST COMMUNITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FINANCIAL HIGHLIGHTS (unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in $000s, except per share and per bed data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months Ended September 30, |
|
Nine
Months Ended September 30, |
|
2014 |
|
2013 |
|
$
Change |
|
%
Change |
|
2014 |
|
2013 |
|
$
Change |
|
%
Change |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
revenues |
$28,309
|
|
$23,257
|
|
$5,052
|
|
21.7%
|
|
$78,010
|
|
$67,302
|
|
$10,708
|
|
15.9%
|
NOI |
15,660
|
|
13,109
|
|
2,551
|
|
19.5%
|
|
$43,571
|
|
$37,422
|
|
6,149
|
|
16.4%
|
Operating
income |
(117,377) |
|
6,330
|
|
(123,707) |
|
NM |
|
(113,279) |
|
15,342
|
|
(128,621) |
|
NM |
Net income
(loss) attributable to common stockholders1 |
(129,974) |
|
3,677
|
|
(133,651) |
|
NM |
|
(135,414) |
|
7,459
|
|
(142,873) |
|
NM |
Net
income (loss) per share - basic and diluted |
($2.01) |
|
$0.06
|
|
($2.07) |
|
NM |
|
($2.09) |
|
$0.13
|
|
($2.22) |
|
NM |
FFO2 |
(118,895) |
|
14,076
|
|
(132,971) |
|
NM |
|
(96,156) |
|
35,020
|
|
(131,176) |
|
NM |
FFO
per share - diluted2,4 |
($1.84) |
|
$0.22
|
|
($2.06) |
|
NM |
|
($1.49) |
|
$0.60
|
|
($2.09) |
|
NM |
FFOA3 |
9,678
|
|
13,051
|
|
(3,373) |
|
(25.8%) |
|
28,228
|
|
31,941
|
|
(3,713) |
|
(11.6%) |
FFOA
per share - diluted3,4 |
$0.15
|
|
$0.20
|
|
($0.05) |
|
(25.0%) |
|
$0.44
|
|
$0.55
|
|
($0.11) |
|
(20.0%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debt
to total market capitalization |
50.5% |
|
33.9% |
|
n/a |
|
16.6%
|
|
50.5% |
|
33.9% |
|
n/a |
|
16.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Statistics (wholly-owned) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
RevPOB5 |
$530
|
|
$518
|
|
$12
|
|
2.3%
|
|
$526
|
|
$517
|
|
$9
|
|
1.7%
|
Average
Physical Occupancy6 |
89.2% |
|
91.1% |
|
n/a |
|
(1.9%) |
|
89.8% |
|
92.3% |
|
n/a |
|
(2.5%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 For the three and nine months ended September
30, 2014 results include certain write-downs and impairments, primarily related to impairment of unconsolidated entities, impairments
of land and predevelopment costs, effect of not exercising Copper Beech purchase option and write off of other corporate assets.
2 For the three and nine months ended September
30, 2014 and the period March 18, 2013 to September 30, 2013, includes results from the Company’s investment in Copper Beech.
The Company made its initial investment in Copper Beech on March 18, 2013 and subsequently made additional investments. On September
30, 2013, the Company entered into an amendment to the purchase and sale agreement that, subject to receipt of required third-party
lender consents, enabled the Company to acquire a 67% ownership interest in 28 operating properties, while deferring ownership
in seven properties until the Company exercises future purchase options. On August 18, 2014, the Company elected to not exercise
the first purchase option and reverted to a 48% interest ownership interest in 35 operating properties. As of September 30, 2014,
the Company held a 48% effective interest in 35 operating and two non-operating properties which are unconsolidated and a 48% interest
in one consolidated operating property.
3 Includes transaction costs and the fair
value adjustment of Copper Beech's debt.
4 Refer to page 6 for a reconciliation
of FFO per share to FFOA per share.
5 Total revenue per occupied bed includes
rental and service revenues.
6 Average monthly occupancy.
CAMPUS
CREST COMMUNITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) |
|
|
|
(in $000s) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, |
|
December 31, |
|
|
2014 |
|
2013 |
|
|
|
|
|
Assets |
|
|
|
|
Investment in real estate, net: |
|
|
|
|
Student housing properties |
|
$923,531 |
|
$716,285 |
Accumulated depreciation |
|
(120,121) |
|
(102,356) |
Development in process |
|
19,802 |
|
91,184 |
Investment in real estate, net |
|
823,212 |
|
705,113 |
Investment in unconsolidated entities1 |
|
275,040 |
|
324,838 |
Cash and cash equivalents |
|
18,313 |
|
32,054 |
Restricted cash 2 |
|
6,207 |
|
32,636 |
Student receivables, net |
|
2,802 |
|
2,825 |
Cost and earnings in excess of construction billings |
|
24,449 |
|
42,803 |
Other assets, net |
|
46,796 |
|
42,410 |
Total assets |
|
$1,196,819 |
|
$1,182,679 |
|
|
|
|
|
Liabilities and equity |
|
|
|
|
Liabilities: |
|
|
|
|
Mortgage and construction loans |
|
$279,152 |
|
$205,531 |
Line of credit and other debt |
|
301,122 |
|
207,952 |
Accounts payable and accrued expenses |
|
69,902 |
|
62,448 |
Construction billings in excess of cost and earnings |
|
8 |
|
600 |
Other liabilities |
|
18,768 |
|
11,167 |
Total liabilities |
|
668,952 |
|
487,698 |
Equity: |
|
|
|
|
Preferred stock |
|
$61 |
|
$61 |
Common stock |
|
648 |
|
645 |
Additional common and preferred paid-in capital |
|
776,605 |
|
773,896 |
Accumulated deficit and distributions |
|
(256,377) |
|
(84,143) |
Accumulated other comprehensive loss |
|
(1,451) |
|
(71) |
Total stockholders' equity |
|
519,486 |
|
690,388 |
Noncontrolling interests |
|
8,381 |
|
4,593 |
Total equity |
|
527,867 |
|
694,981 |
Total liabilities and equity |
|
$1,196,819 |
|
$1,182,679 |
|
|
|
|
|
1 As of December 31, 2013, includes the
Company’s investment in Copper Beech equating to a 67% effective ownership interest in 30 properties, of which 28 are operating
and two are non-operating properties. On August 18, 2014, the Company elected to not exercise the first purchase option and reverted
to a 48% interest ownership interest in 35 operating properties. As of September 30, 2014, the Company held a 48% effective interest
in 35 operating and two non-operating properties which are unconsolidated and a 48% interest in one consolidated operating property.
2 As of September 30, 2014 and December
31, 2013, includes approximately $0 and $28,200, respectively, of cash held in escrow from the sale of four wholly-owned Grove-branded
student housing properties on December 27, 2013.
CAMPUS
CREST COMMUNITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) |
|
|
|
|
|
|
(in $000s, except per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months Ended September 30, |
|
Nine
Months Ended September 30, |
|
|
2014 |
|
2013 |
|
$
Change |
|
2014 |
|
2013 |
|
$
Change |
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
Student
housing rental |
|
$26,985
|
|
$22,165
|
|
$4,820
|
|
$74,256
|
|
$64,118
|
|
$10,138
|
Student
housing services |
|
1,043
|
|
867
|
|
176
|
|
3,043
|
|
2,645
|
|
398
|
Property
management services |
|
281
|
|
225
|
|
56
|
|
711
|
|
539
|
|
172
|
Total
revenues |
|
28,309
|
|
23,257
|
|
5,052
|
|
78,010
|
|
67,302
|
|
10,708
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
Student
housing operations |
|
12,368
|
|
9,923
|
|
2,445
|
|
33,728
|
|
29,341
|
|
4,387
|
General
and administrative1 |
|
4,043
|
|
2,424
|
|
1,619
|
|
11,198
|
|
8,076
|
|
3,122
|
Impairment
of land & predevelopment costs |
|
29,790
|
|
-
|
|
29,790
|
|
29,790
|
|
-
|
|
29,790
|
Write-off
of corporate other assets |
|
7,765
|
|
-
|
|
7,765
|
|
7,765
|
|
-
|
|
7,765
|
Transaction
costs2 |
|
286
|
|
247
|
|
39
|
|
2,331
|
|
835
|
|
1,496
|
Ground
leases |
|
120
|
|
54
|
|
66
|
|
357
|
|
162
|
|
195
|
Depreciation
and amortization |
|
7,035
|
|
5,581
|
|
1,454
|
|
21,269
|
|
17,154
|
|
4,115
|
Total
operating expenses |
|
61,407
|
|
18,229
|
|
43,178
|
|
106,438
|
|
55,568
|
|
50,870
|
Equity
in earnings (loss) of unconsolidated entities3,4 |
|
635
|
|
1,302
|
|
(667) |
|
63
|
|
3,608
|
|
(3,545) |
Impairment
of unconsolidated entities |
|
(50,866) |
|
-
|
|
(50,866) |
|
(50,866) |
|
-
|
|
(50,866) |
Effect
of not exercising Copper Beech purchase option |
|
(34,048) |
|
-
|
|
(34,048) |
|
(34,048) |
|
-
|
|
(34,048) |
Operating
income |
|
(117,377) |
|
6,330
|
|
(123,707) |
|
(113,279) |
|
15,342
|
|
(128,621) |
Nonoperating
income (expense): |
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense, net |
|
(3,639) |
|
(3,091) |
|
(548) |
|
(9,965) |
|
(8,764) |
|
(1,201) |
Other
income (expense)5 |
|
(41) |
|
696
|
|
(737) |
|
129
|
|
1,421
|
|
(1,292) |
Total
nonoperating expense, net |
|
(3,680) |
|
(2,395) |
|
(1,285) |
|
(9,836) |
|
(7,343) |
|
(2,493) |
Net
income before income tax benefit (expense) |
|
(121,057) |
|
3,935
|
|
(124,992) |
|
(123,115) |
|
7,999
|
|
(131,114) |
Income
tax benefit (expense) |
|
(1,131) |
|
(40) |
|
(1,091) |
|
(731) |
|
306
|
|
(1,037) |
Income
from continuing operations |
|
(122,188) |
|
3,895
|
|
(126,083) |
|
(123,846) |
|
8,305
|
|
(132,151) |
Income
(loss) from discontinued operations |
|
(5,506) |
|
958
|
|
(6,464) |
|
(3,191) |
|
2,655
|
|
(5,846) |
Net
income (loss) |
|
(127,694) |
|
4,853
|
|
(132,547) |
|
(127,037) |
|
10,960
|
|
(137,997) |
Dividends
on preferred stock |
|
3,050
|
|
1,150
|
|
1,900
|
|
9,150
|
|
3,450
|
|
5,700
|
Net
income (loss) attributable to noncontrolling interests |
|
(770) |
|
26
|
|
(796) |
|
(773) |
|
51
|
|
(824) |
Net
income (loss) attributable to common stockholders |
|
($129,974) |
|
$3,677
|
|
($133,651) |
|
($135,414) |
|
$7,459
|
|
($142,873) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Per
share data - basic and diluted: |
|
|
|
|
|
|
|
|
|
|
|
|
Income
(loss) from continuing operations attributable to common stockholders |
|
($1.92) |
|
$0.05
|
|
|
|
($2.04) |
|
$0.08
|
|
|
Income
(loss) from discontinued operations attributable to common stockholders |
|
($0.09) |
|
$0.01
|
|
|
|
($0.05) |
|
$0.05
|
|
|
Net
income (loss) per share attributable to common stockholders |
|
($2.01) |
|
$0.06
|
|
|
|
($2.09) |
|
$0.13
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average common shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
64,770
|
|
64,518
|
|
|
|
64,650
|
|
58,461
|
|
|
Diluted |
|
64,770
|
|
64,953
|
|
|
|
64,650
|
|
58,896
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 For three and nine months ended September
30, 2014, includes $720 of severance costs.
2 For the three and nine months ended September
30, 2014, includes $286 and $2,331, respectively, of transaction costs related to Copper Beech, the Montreal investments and other
transaction costs. Additionally, for the three and nine months ended September 30, 2013, includes $247 and $835, respectively,
of transaction costs related to Copper Beech.
3 For the three and nine months ended September
30, 2014 and the period from March 18, 2013 to September 30, 2013, includes results from the Company’s investment in Copper
Beech. The Company made its initial investment on March 18, 2013 and subsequently made additional investments. On September 30,
2013, the Company entered into an amendment to the purchase and sale agreement that, subject to receipt of required third-party
lender consents, enabled the Company to acquire a 67% ownership interest in 28 operating properties, while deferring ownership
in seven properties until the Company exercises future purchase options. On August 18, 2014, the Company elected to not exercise
the first purchase option and reverted to a 48% interest ownership interest in 35 operating properties. As of September 30, 2014,
the Company held a 48% effective interest in 35 operating and two non-operating properties which are unconsolidated and a 48% interest
in one consolidated operating property.
4 For the three and nine months ended September
30, 2014, includes $1,539 and $5,058, respectively, of fair value adjustment related to Copper Beech's debt. For the three and
nine months ended September 30, 2013, includes $1,220 and $2,165, respectively, of fair value adjustment related to Copper Beech's
debt.
5 For the three and nine months ended September
30, 2013, includes interest income from the 8.5%, $31,700 loan made to existing investors in Copper Beech on March 18, 2013. In
conjunction with the September 30, 2013 amendment to the purchase and sale agreement, the $31,700 loan was repaid by Copper Beech.
CAMPUS
CREST COMMUNITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RECONCILIATION OF NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS TO FUNDS FROM OPERATIONS ("FFO"), FUNDS FROM OPERATIONS ADJUSTED ("FFOA") & NET OPERATING INCOME ("NOI") (unaudited) |
|
|
|
|
|
|
(in $000s, except per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months Ended September 30, |
|
Nine
Months Ended September 30, |
|
2014 |
|
2013 |
|
$
Change |
|
2014 |
|
2013 |
|
$
Change |
|
|
|
|
|
|
|
|
|
|
|
|
Net
income (loss) attributable to common stockholders |
($129,974) |
|
$3,677
|
|
($133,651) |
|
($135,414) |
|
$7,459
|
|
($142,873) |
Net
income (loss) attributable to noncontrolling interests |
(770) |
|
26
|
|
(796) |
|
(773) |
|
51
|
|
(824) |
Real
estate related depreciation and amortization |
6,590
|
|
5,341
|
|
1,249
|
|
20,175
|
|
16,523
|
|
3,652
|
Real
estate related depreciation and amortization - discontinued operations |
-
|
|
545
|
|
(545) |
|
-
|
|
2,070
|
|
(2,070) |
Real
estate related depreciation and amortization - unconsolidated entities |
5,259
|
|
4,487
|
|
772
|
|
19,856
|
|
8,917
|
|
10,939
|
FFO
available to common shares and OP units1, 2, 3 |
(118,895) |
|
14,076
|
|
(132,971) |
|
(96,156) |
|
35,020
|
|
(131,176) |
Elimination
of the following: |
|
|
|
|
|
|
|
|
|
|
|
Transaction
costs |
286
|
|
1,153
|
|
(867) |
|
2,331
|
|
1,741
|
|
590
|
Impairment
of land & predevelopment costs |
29,790
|
|
-
|
|
29,790
|
|
29,790
|
|
-
|
|
29,790
|
Write
off of corporate other assets |
7,765
|
|
-
|
|
7,765
|
|
7,765
|
|
-
|
|
7,765
|
Severance |
720
|
|
-
|
|
720
|
|
720
|
|
-
|
|
720
|
Change
in valuation allowance for deferred tax asset |
1,131
|
|
-
|
|
1,131
|
|
731
|
|
-
|
|
731
|
Discontinued
operations |
5,506
|
|
(958) |
|
6,464
|
|
3,191
|
|
(2,655) |
|
5,846
|
Impairment
of unconsolidated entities |
50,866
|
|
-
|
|
50,866
|
|
50,866
|
|
-
|
|
50,866
|
Effect
of not exercising Copper Beech purchase option |
34,048
|
|
-
|
|
34,048
|
|
34,048
|
|
-
|
|
34,048
|
FV
adjustment of CB debt |
(1,539) |
|
(1,220) |
|
(319) |
|
(5,058) |
|
(2,165) |
|
(2,893) |
Funds
from operations adjusted (FFOA) available to common |
|
|
|
|
|
|
|
|
|
|
|
shares
and OP units |
$9,678
|
|
$13,051
|
|
($3,373) |
|
$28,228
|
|
$31,941
|
|
($3,713) |
|
|
|
|
|
|
|
|
|
|
|
|
FFO
per share - diluted1, 2, 3 |
($1.84) |
|
$0.22
|
|
($2.06) |
|
($1.49) |
|
$0.60
|
|
($2.09) |
FFOA
per share - diluted |
$0.15
|
|
$0.20
|
|
($0.05) |
|
$0.44
|
|
$0.55
|
|
($0.11) |
Weighted
average common shares and OP units outstanding - basic/dilutive4 |
64,770
|
|
64,518
|
|
|
|
64,650
|
|
58,461
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months Ended September 30, |
|
|
|
Nine
Months Ended September 30, |
|
|
|
20141 |
|
20131 |
|
|
|
20141 |
|
20131 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income (Loss) attributable to common stockholders |
($129,974) |
|
$3,677
|
|
|
|
($135,414) |
|
$7,459
|
|
|
Net
income (Loss) attributable to noncontrolling interests |
(770) |
|
26
|
|
|
|
(773) |
|
51
|
|
|
Preferred
stock dividends |
3,050
|
|
1,150
|
|
|
|
9,150
|
|
3,450
|
|
|
Income
tax (benefit) expense |
1,131
|
|
40
|
|
|
|
731
|
|
(306) |
|
|
Other
(income) expense |
41
|
|
(696) |
|
|
|
(129) |
|
(1,348) |
|
|
(Income)
loss on discontinued operations |
5,506
|
|
(958) |
|
|
|
3,191
|
|
(2,655) |
|
|
Interest
expense |
3,639
|
|
3,091
|
|
|
|
9,965
|
|
8,764
|
|
|
Equity
in earnings of unconsolidated entities |
(635) |
|
(1,302) |
|
|
|
(63) |
|
(3,608) |
|
|
Depreciation
and amortization |
7,035
|
|
5,581
|
|
|
|
21,269
|
|
17,154
|
|
|
Ground
lease expense |
120
|
|
54
|
|
|
|
357
|
|
162
|
|
|
General
and administrative expense5 |
4,043
|
|
2,424
|
|
|
|
11,198
|
|
8,076
|
|
|
Impairment
of unconsolidated entities |
50,866
|
|
-
|
|
|
|
50,866
|
|
-
|
|
|
Effect
of not exercising Copper Beech purchase option |
34,048
|
|
-
|
|
|
|
34,048
|
|
-
|
|
|
Impairment
of land & predevelopment costs |
29,790
|
|
-
|
|
|
|
29,790
|
|
-
|
|
|
Write-off
of corporate other assets |
7,765
|
|
-
|
|
|
|
7,765
|
|
-
|
|
|
Transaction
costs |
286
|
|
247
|
|
|
|
2,331
|
|
835
|
|
|
Property
management services |
(281) |
|
(225) |
|
|
|
(711) |
|
(539) |
|
|
Total
NOI |
$15,660 |
|
$13,109 |
|
|
|
$43,571 |
|
$37,495 |
|
|
Same
store properties NOI6 |
$10,525 |
|
$11,424 |
|
|
|
$33,461 |
|
$35,412 |
|
|
New
properties NOI6,7 |
$4,259 |
|
$1,224 |
|
|
|
$7,743 |
|
$1,255 |
|
|
The
Grove at Pullman & Toledo NOI8 |
$876 |
|
$461 |
|
|
|
$2,367 |
|
$755 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 For the three and nine months ended September
30, 2014 and the period March 18, 2013 to June 30, 2013, includes results from the Company’s investment in Copper Beech.
The Company made its initial investment on March 18, 2013 and subsequently made additional investments. On September 30, 2013,
the Company entered into an amendment to the purchase and sale agreement that, subject to receipt of required third-party lender
consents, enabled the Company to acquire a 67% ownership interest in 28 operating properties, while deferring ownership in seven
properties until the Company exercises future purchase options. On August 18, 2014, the Company elected to not exercise the first
purchase option and reverted to a 48% interest ownership interest in 35 operating properties. As of September 30, 2014, the Company
held a 48% effective interest in 35 operating and two non-operating properties which are unconsolidated and a 48% interest in one
consolidated operating property.
2 For the three and nine months ended September
30, 2014, includes $286 and $2,331, respectively, of transaction costs related to Copper Beech, the Montreal investments and other
transaction costs. Additionally, for the three and nine months ended September 30, 2013, includes $247 and $835, respectively,
of transaction costs related to Copper Beech.
3 For the three and nine months ended September
30, 2014, includes $1,539 and $5,058, respectively, of fair value adjustment related to Copper Beech's debt. For the three and
nine months ended September 30, 2013, includes $1,220 and $2,165, respectively, of fair value adjustment related to Copper Beech's
debt.
4 For the three and nine months ended September
30, 2014, the basic shares were used to calculate FFO and FFOA as the dilutive shares would have been anti-dilutive. For the three
and nine months ended September 30, 2013, the dilutive shares were used to calculate FFO and FFOA.
5For three and nine months ended September
30, 2014, includes $720 of severance costs.
6 "Same store" properties are our wholly-owned
operating properties acquired or placed in-service prior to the beginning of the earliest period presented and owned by us and
remaining in service through the end of the latest period presented or period being analyzed. "New properties" are our
wholly-owned operating properties that we acquired or placed in service after the beginning of the earliest period presented or
period being analyzed.
7 Includes NOI contribution from Copper
Beech at Ames. This is a consolidated joint venture.
8 Includes NOI contribution from the operations
of The Grove at Pullman and the Toledo, OH redevelopment, as well as business interruption insurance proceeds from The Grove at
Pullman.
CAMPUS
CREST COMMUNITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WHOLLY OWNED PROPERTY RESULTS OF OPERATIONS (unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in $000s, except bed data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months Ended September 30, |
|
Nine
Months Ended September 30, |
|
2014 |
|
2013 |
|
Change |
|
%
Change |
|
2014 |
|
2013 |
|
Change |
|
%
Change |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Same store properties
(Number of properties) |
28
|
|
28
|
|
|
|
|
|
28
|
|
28
|
|
|
|
|
Revenue per occupied
bed |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rental revenue per
occupied bed per month |
$498
|
|
$497
|
|
$1
|
|
0.2%
|
|
$497
|
|
$496
|
|
$1
|
|
0.2%
|
Services revenue
per occupied bed per month |
21
|
|
19
|
|
2
|
|
10.5%
|
|
21
|
|
20
|
|
1
|
|
5.0%
|
Total revenue per
occupied bed |
$519
|
|
$516
|
|
$3
|
|
0.6%
|
|
$518
|
|
$516
|
|
$2
|
|
0.4%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average number of
owned beds |
14,920
|
|
14,920
|
|
|
|
|
|
14,920
|
|
14,920
|
|
|
|
|
Average physical
occupancy |
90.0% |
|
91.5% |
|
|
|
(1.5%) |
|
90.2% |
|
92.5% |
|
|
|
(2.3%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue |
$20,890
|
|
$21,118
|
|
($228) |
|
(1.1%) |
|
$62,667
|
|
$64,110
|
|
($1,443) |
|
(2.3%) |
Property operating
expenses |
10,365
|
|
9,694
|
|
671
|
|
6.9%
|
|
29,206
|
|
28,698
|
|
508
|
|
1.8%
|
Net operating income |
$10,525
|
|
$11,424
|
|
($899) |
|
(7.9%) |
|
$33,461
|
|
$35,412
|
|
($1,951) |
|
(5.5%) |
Operating margin1 |
50.4% |
|
54.1% |
|
|
|
(3.7%) |
|
53.4% |
|
55.2% |
|
|
|
(1.8%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
New properties (Number
of properties)2, 3, 4, 5 |
7
|
|
2
|
|
5
|
|
|
|
7
|
|
2
|
|
5
|
|
|
Revenue per occupied
bed |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rental revenue per
occupied bed per month |
$563
|
|
$552
|
|
$11
|
|
1.9%
|
|
$565
|
|
$552
|
|
$13
|
|
2.2%
|
Services revenue
per occupied bed per month |
17
|
|
$6
|
|
11
|
|
66.7%
|
|
18
|
|
6
|
|
12
|
|
68.6%
|
Total revenue per
occupied bed |
$580
|
|
$558
|
|
$22
|
|
3.8%
|
|
$583
|
|
$558
|
|
$25
|
|
4.3%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average number of
owned beds |
3,618
|
|
925
|
|
|
|
|
|
2,521
|
|
308
|
|
|
|
|
Average physical
occupancy |
86.0% |
|
85.7% |
|
|
|
0.3%
|
|
87.2% |
|
85.7% |
|
|
|
1.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue |
$5,408
|
|
$1,327
|
|
$4,081
|
|
75.5%
|
|
$11,528
|
|
$1,327
|
|
$10,201
|
|
88.5%
|
Property operating
expenses |
1,149
|
|
103
|
|
1,046
|
|
91.0%
|
|
3,785
|
|
72
|
|
3,713
|
|
98.1%
|
Net operating income |
$4,259
|
|
$1,224
|
|
$3,035
|
|
71.3%
|
|
$7,743
|
|
$1,255
|
|
$6,488
|
|
83.8%
|
Operating margin1 |
78.8% |
|
92.2% |
|
|
|
(13.4%) |
|
67.2% |
|
94.6% |
|
|
|
(27.4%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ALL PROPERTIES (Number
of properties) |
35
|
|
30
|
|
5
|
|
|
|
35
|
|
30
|
|
5
|
|
|
Revenue per occupied
bed |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rental revenue per
occupied bed per month |
$510
|
|
$500
|
|
$10
|
|
2.0%
|
|
$506
|
|
$497
|
|
$9
|
|
1.8%
|
Services revenue
per occupied bed per month |
20
|
|
18
|
|
2
|
|
11.1%
|
|
20
|
|
20
|
|
0
|
|
0.0%
|
Total revenue per
occupied bed |
$530
|
|
$518
|
|
$12
|
|
2.3%
|
|
$526
|
|
$517
|
|
$9
|
|
1.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average number of
owned beds |
18,538
|
|
15,845
|
|
|
|
|
|
17,441
|
|
15,228
|
|
|
|
|
Average physical
occupancy |
89.2% |
|
91.1% |
|
|
|
(1.9%) |
|
89.8% |
|
92.3% |
|
|
|
(2.5%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue |
$26,298
|
|
$22,445
|
|
$3,853
|
|
17.2%
|
|
$74,195
|
|
$65,437
|
|
$8,758
|
|
13.4%
|
Property operating
expenses |
11,514
|
|
9,797
|
|
1,717
|
|
17.5%
|
|
32,991
|
|
28,770
|
|
4,221
|
|
14.7%
|
Net operating income |
$14,784
|
|
$12,648
|
|
$2,136
|
|
16.9%
|
|
$41,204
|
|
$36,667
|
|
$4,537
|
|
12.4%
|
Operating margin1 |
56.2% |
|
56.4% |
|
|
|
(0.2%) |
|
55.5% |
|
56.0% |
|
|
|
(0.5%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Grove at Pullman
& Toledo NOI6 |
$876
|
|
$461
|
|
|
|
|
|
$2,367
|
|
$755
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Operating margin is calculated by dividing
NOI for the period by total student housing rental and services revenues for the period.
2 For the three and nine months ended September
30, 2014, includes financial results for the 2013 wholly-owned deliveries (The Grove at Ft. Collins, The Grove at Muncie, and The
Grove at Flagstaff - Phase II). The Grove at Flagstaff - Phase II is not included as an additional property, but increases the
number of beds. Also includes financial results for The Grove at Denton. For the three months ended September 30, 2014 includes
financial results for the 2014 wholly-owned deliveries (The Grove at Gainesville, The Grove at Grand Forks, The Grove at Slippery
Rock and The Grove at Mt. Pleasant).
3 For the three and nine months ended September
30, 2014, excludes financial results from The Grove at Pullman, WA. On July 14, 2013, the Company experienced a fire at this development.
The Company reached a resolution with its insurance provider and while no assurances can be given, after taking into account its
existing insurance coverage, it believes that the damages sustained as a result of this fire will not have a material adverse effect
on its financial position or results of operations. As of September 2014, all 584 beds were in operation. For comparability of
results, Pullman will continue to be excluded until year over year results are not impacted by the business interruption.
4 For the three and nine months ended September
30, 2014 and 2013, excludes financial results from the Toledo, OH redevelopment the Company acquired on March 15, 2013. The Company
has begun a phased redevelopment of the property and has placed a portion of the project in service in August 2014.
5 For the nine months ended September 30,
2014, includes a partial period for The Grove at Denton; the Company acquired its joint venture partner's interest in this property
on January 21, 2014.
6 Includes NOI contribution from the operations
of The Grove at Pullman and the Toledo, OH redevelopment, as well as business interruption insurance proceeds from The Grove at
Pullman.
CAMPUS
CREST COMMUNITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LTM WHOLLY OWNED PROPERTY RESULTS OF OPERATIONS (unaudited) |
|
|
|
|
|
|
|
(in $000s, except bed data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months Ended |
|
Total/Weighted
Average |
|
September
30, 2013 |
|
December
31, 2013 |
|
March
31, 2014 |
|
June
30, 2014 |
|
September
30, 2014 |
|
Last
Twelve Months |
|
|
|
|
|
|
|
|
|
|
|
|
Same
store properties (Number of properties) |
28
|
|
28
|
|
28
|
|
28
|
|
28
|
|
28
|
Revenue
per occupied bed |
|
|
|
|
|
|
|
|
|
|
|
Rental
revenue per occupied bed per month |
$497
|
|
$501
|
|
$498
|
|
$495
|
|
$498
|
|
$498
|
Services
revenue per occupied bed per month |
19
|
|
20
|
|
20
|
|
21
|
|
21
|
|
20
|
Total
revenue per occupied bed |
$516
|
|
$521
|
|
$518
|
|
$516
|
|
$519
|
|
$518
|
|
|
|
|
|
|
|
|
|
|
|
|
Average
number of owned beds |
14,920
|
|
14,920
|
|
14,920
|
|
14,920
|
|
14,920
|
|
14,920
|
Average
physical occupancy |
91.5% |
|
92.4% |
|
90.5% |
|
90.1% |
|
90.0% |
|
90.8% |
|
|
|
|
|
|
|
|
|
|
|
|
Total
revenue |
$21,118
|
|
$21,551
|
|
$20,980
|
|
$20,797
|
|
$20,890
|
|
$84,218
|
Property
operating expenses |
9,694
|
|
10,330
|
|
9,436
|
|
9,404
|
|
10,365
|
|
39,535
|
Net
operating income |
$11,424
|
|
$11,221
|
|
$11,544
|
|
$11,393
|
|
$10,525
|
|
$44,683
|
Operating
margin1 |
54.1% |
|
52.1% |
|
55.0% |
|
54.8% |
|
50.4% |
|
53.1% |
|
|
|
|
|
|
|
|
|
|
|
|
New
properties (Number of properties)2, 3, 4 |
2
|
|
2
|
|
3
|
|
3
|
|
7
|
|
NA |
Revenue
per occupied bed |
|
|
|
|
|
|
|
|
|
|
|
Rental
revenue per occupied bed per month |
$547
|
|
$572
|
|
$567
|
|
$564
|
|
$563
|
|
$565
|
Services
revenue per occupied bed per month |
10
|
|
30
|
|
19
|
|
19
|
|
17
|
|
20
|
Total
revenue per occupied bed |
$557
|
|
$602
|
|
$586
|
|
$583
|
|
$580
|
|
$585
|
|
|
|
|
|
|
|
|
|
|
|
|
Average
number of owned beds |
925
|
|
1,388
|
|
1,846
|
|
1,972
|
|
3,618
|
|
2,206
|
Average
physical occupancy |
85.7% |
|
87.4% |
|
87.5% |
|
89.3% |
|
86.0% |
|
87.3% |
|
|
|
|
|
|
|
|
|
|
|
|
Total
revenue |
$1,343
|
|
$2,190
|
|
$2,839
|
|
$3,080
|
|
$5,408
|
|
$13,517
|
Property
operating expenses |
166
|
|
659
|
|
1,147
|
|
1,310
|
|
1,149
|
|
4,265
|
Net
operating income |
$1,177
|
|
$1,531
|
|
$1,692
|
|
$1,770
|
|
$4,259
|
|
$9,252
|
Operating
margin1 |
87.6% |
|
69.9% |
|
59.6% |
|
57.5% |
|
78.8% |
|
68.4% |
|
|
|
|
|
|
|
|
|
|
|
|
ALL
PROPERTIES (Number of properties) |
30
|
|
30
|
|
31
|
|
31
|
|
35
|
|
NA |
Revenue
per occupied bed |
|
|
|
|
|
|
|
|
|
|
|
Rental
revenue per occupied bed per month |
$499
|
|
$507
|
|
$505
|
|
$503
|
|
$510
|
|
$506
|
Services
revenue per occupied bed per month |
19
|
|
21
|
|
20
|
|
21
|
|
20
|
|
20
|
Total
revenue per occupied bed |
$518
|
|
$528
|
|
$525
|
|
$524
|
|
$530
|
|
$526
|
|
|
|
|
|
|
|
|
|
|
|
|
Average
number of owned beds |
15,845
|
|
16,308
|
|
16,766
|
|
16,892
|
|
18,538
|
|
17,126
|
Average
physical occupancy |
91.1% |
|
92.0% |
|
90.2% |
|
90.0% |
|
89.2% |
|
90.3% |
|
|
|
|
|
|
|
|
|
|
|
|
Total
revenue |
$22,461
|
|
$23,741
|
|
$23,819
|
|
$23,877
|
|
$26,298
|
|
$97,735
|
Property
operating expenses |
9,860
|
|
10,989
|
|
10,583
|
|
10,714
|
|
11,514
|
|
43,800
|
Net
operating income |
$12,601
|
|
$12,752
|
|
$13,236
|
|
$13,163
|
|
$14,784
|
|
$53,935
|
Operating
margin1 |
56.1% |
|
53.7% |
|
55.6% |
|
55.1% |
|
56.2% |
|
55.2% |
|
|
|
|
|
|
|
|
|
|
|
|
The
Grove at Pullman & Toledo NOI6 |
$506
|
|
$764
|
|
$759
|
|
$753
|
|
$876
|
|
$3,152
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Operating margin is calculated by dividing
NOI for the period by total student housing rental and services revenues for the period.
2 For the three months ended September 30, 2013,
December 31, 2013, March 31, 2014, June 30, 2014, and September 30, 2014 includes financial results for the 2013 wholly-owned
deliveries (The Grove at Ft. Collins, The Grove at Muncie, and The Grove at Flagstaff - Phase II). The Grove at Flagstaff - Phase
II is not included as an additional property, but increases the number of beds. For the three months ended March 31, 2014, June
30, 2014, and September 30, 2014 includes financial results for The Grove at Denton. For the three months ended September 30,
2014 includes financial results for the 2014 wholly-owned deliveries (The Grove at Gainesville, The Grove at Grand Forks, The
Grove at Slippery Rock and The Grove at Mt. Pleasant).
3 For the three months ended September 30, 2013,
December 31, 2013, March 31, 2014, June 30, 2014, and September 30, 2014 excludes financial results from the The Grove at Pullman,
WA. On July 14, 2013, the Company experienced a fire at this development. The Company reached a resolution with its insurance
provider and while no assurances can be given, after taking into account its existing insurance coverage, it believes that the
damages sustained as a result of this fire will not have a material adverse effect on its financial position or results of operations.
As of September 2014, all 584 beds were in operation. For comparability of results, Pullman will continue to be excluded until
year over year results are not impacted by the business interruption.
4 For the three months ended September 30, 2013,
December 31, 2013, March 31, 2014, June 30, 2014, and September 30, 2014, excludes financial results from the Toledo, OH redevelopment
the Company acquired on March 15, 2013. The Company has begun a phased redevelopment of the property and has placed a portion
of the project in service in August 2014.
5 For the three months ended March 31,
2014, includes a partial period for The Grove at Denton; the Company acquired its joint venture partner's interest in this property
on January 21, 2014.
6 For the three months ended September 30, 2013,
December 31, 2013, March 31, 2014, June 30, 2014, and September 30, 2014 includes NOI contribution from the operations of The
Grove at Pullman and the Toledo, OH redevelopment, as well as business interruption insurance proceeds from The Grove at Pullman,
WA.
CAMPUS
CREST COMMUNITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SAME STORE WHOLLY OWNED OPERATING EXPENSES (unaudited) |
|
|
|
|
|
|
|
|
|
|
(in $000s, except bed and property data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months Ended September 30, 2014 |
|
Three
Months Ended September 30, 2013 |
|
Y-o-Y
Total Change |
|
|
Total |
|
%
of Total |
|
Per
Bed/Month |
|
|
Total |
|
%
of Total |
|
Per
Bed/Month |
|
$ |
|
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Payroll |
|
$2,244
|
|
21.6%
|
|
$50
|
|
|
$2,574
|
|
26.5%
|
|
$57
|
|
($330) |
|
(12.8%) |
Marketing |
|
$494
|
|
4.8%
|
|
$11
|
|
|
$336
|
|
3.5%
|
|
$7
|
|
158
|
|
47.2%
|
Office, Administration
& Other1 |
|
$1,943
|
|
18.7%
|
|
$43
|
|
|
$1,144
|
|
11.8%
|
|
$26
|
|
799
|
|
69.8%
|
Utilites |
|
$2,938
|
|
28.3%
|
|
$66
|
|
|
$3,010
|
|
31.0%
|
|
$67
|
|
(72) |
|
(2.4%) |
Repairs and Maintenance |
|
$734
|
|
7.1%
|
|
$16
|
|
|
$785
|
|
8.1%
|
|
$18
|
|
(51) |
|
(6.5%) |
Taxes and Insurance |
|
$2,012
|
|
19.4%
|
|
$45
|
|
|
$1,846
|
|
19.0%
|
|
$41
|
|
166
|
|
9.0%
|
Total |
|
$10,365
|
|
100.0%
|
|
$231
|
|
|
$9,694
|
|
100.0%
|
|
$217
|
|
$670
|
|
6.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Same Store |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Wholly Owned Beds |
|
14,920
|
|
|
|
|
|
|
14,920
|
|
|
|
|
|
|
|
|
Wholly Owned Properties |
|
28
|
|
|
|
|
|
|
28
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine
Months Ended September 30, 2014 |
|
Nine
Months Ended September 30, 2013 |
|
Y-o-Y
Total Change |
|
|
Total |
|
%
of Total |
|
Per
Bed/Month |
|
|
Total |
|
%
of Total |
|
Per
Bed/Month |
|
$ |
|
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Payroll |
|
$6,501
|
|
22.3%
|
|
$73
|
|
|
$6,814
|
|
23.7%
|
|
$76
|
|
($313) |
|
(4.6%) |
Marketing |
|
$1,245
|
|
4.3%
|
|
$14
|
|
|
$1,046
|
|
3.6%
|
|
$12
|
|
199
|
|
19.1%
|
Office, Administration
& Other |
|
$3,574
|
|
12.2%
|
|
$40
|
|
|
$3,244
|
|
11.3%
|
|
$36
|
|
330
|
|
10.2%
|
Utilites |
|
$9,148
|
|
31.3%
|
|
$102
|
|
|
$9,154
|
|
31.9%
|
|
$102
|
|
(6) |
|
(0.1%) |
Repairs and Maintenance |
|
$2,544
|
|
8.7%
|
|
$28
|
|
|
$2,676
|
|
9.3%
|
|
$30
|
|
(132) |
|
(4.9%) |
Taxes and Insurance |
|
$6,194
|
|
21.2%
|
|
$69
|
|
|
$5,765
|
|
20.1%
|
|
$64
|
|
429
|
|
7.4%
|
Total |
|
$29,206
|
|
100.0%
|
|
$326
|
|
|
$28,698
|
|
100.0%
|
|
$320
|
|
$507
|
|
1.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Same Store |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Wholly Owned Beds |
|
14,920
|
|
|
|
|
|
|
14,920
|
|
|
|
|
|
|
|
|
Wholly Owned Properties |
|
28
|
|
|
|
|
|
|
28
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Includes bad debt expense of $1,500 and $609 for
three months ended September 30, 2014 and September 30, 2013 respectively.
CAMPUS
CREST COMMUNITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
HSRE, BEAUMONT AND COPPER BEECH JOINT VENTURE PROPERTY RESULTS OF OPERATIONS (unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in $000s, except per bed data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months Ended September 30, |
|
Nine
Months Ended September 30, |
|
2014 |
|
2013 |
|
Change |
|
%
Change |
|
2014 |
|
2013 |
|
Change |
|
%
Change |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
HSRE AND BEAUMONT |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Same store properties
(Number of properties)1 |
6
|
|
6
|
|
|
|
|
|
6
|
|
6
|
|
|
|
|
Revenue per occupied
bed |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rental revenue per
occupied bed per month |
$455
|
|
$462
|
|
($7) |
|
(1.5%) |
|
$456
|
|
$469
|
|
($13) |
|
(2.8%) |
Services revenue
per occupied bed per month |
22
|
|
19
|
|
3
|
|
15.8%
|
|
20
|
|
21
|
|
(1) |
|
(4.8%) |
Total revenue per
occupied bed |
$477
|
|
$481
|
|
($4) |
|
(0.8%) |
|
$476
|
|
$490
|
|
($14) |
|
(2.9%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average number of
owned beds |
3,364
|
|
3,364
|
|
|
|
|
|
3,364
|
|
3,364
|
|
|
|
|
Average physical
occupancy |
79.7% |
|
79.1% |
|
|
|
0.6%
|
|
80.1% |
|
78.6% |
|
|
|
1.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue |
$3,834
|
|
$3,841
|
|
($7) |
|
(0.2%) |
|
$11,542
|
|
$11,667
|
|
($125) |
|
(1.1%) |
Property operating
expenses |
2,182
|
|
2,197
|
|
(15) |
|
(0.7%) |
|
6,421
|
|
6,473
|
|
(52) |
|
(0.8%) |
Net operating income |
$1,652
|
|
$1,644
|
|
$8
|
|
0.5%
|
|
$5,121
|
|
$5,194
|
|
($73) |
|
(1.4%) |
Operating margin2 |
43.1% |
|
42.8% |
|
|
|
0.3%
|
|
44.4% |
|
44.5% |
|
|
|
(0.1%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ALL PROPERTIES (Number
of properties)1,3 |
14
|
|
9
|
|
|
|
|
|
14
|
|
9
|
|
|
|
|
Revenue per occupied
bed |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rental revenue per
occupied bed per month |
$540
|
|
$485
|
|
$55
|
|
11.3%
|
|
$522
|
|
$477
|
|
$45
|
|
9.4%
|
Services revenue
per occupied bed per month |
21
|
|
$19
|
|
2
|
|
10.5%
|
|
20
|
|
$21
|
|
(1) |
|
(4.8%) |
Total revenue per
occupied bed |
$561
|
|
$504
|
|
$57
|
|
11.3%
|
|
$542
|
|
$498
|
|
$44
|
|
8.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average number of
owned beds |
7,282
|
|
4,553
|
|
2,729
|
|
59.9%
|
|
5,859
|
|
3,760
|
|
2,099
|
|
55.8%
|
Average physical
occupancy |
66.8% |
|
79.1% |
|
|
|
(12.3%) |
|
73.0% |
|
78.6% |
|
|
|
(5.6%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue |
$8,227
|
|
$5,446
|
|
$2,781
|
|
51.1%
|
|
$20,901
|
|
$13,275
|
|
$7,626
|
|
57.4%
|
Property operating
expenses |
5,714
|
|
2,524
|
|
3,190
|
|
126.4%
|
|
12,770
|
|
6,801
|
|
5,969
|
|
87.8%
|
Net operating income |
$2,513
|
|
$2,922
|
|
($409) |
|
(14.0%) |
|
$8,131
|
|
$6,474
|
|
$1,657
|
|
25.6%
|
Operating margin2 |
30.5% |
|
53.7% |
|
|
|
(23.2%) |
|
38.9% |
|
48.8% |
|
|
|
(9.9%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred
investments4, 5 |
$7,322
|
|
$11,827
|
|
($4,505) |
|
|
|
$7,322
|
|
$11,827
|
|
($4,505) |
|
|
COPPER BEECH |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ALL PROPERTIES (Number
of properties)6, 7, 8 |
36
|
|
35
|
|
1
|
|
|
|
36
|
|
35
|
|
1
|
|
|
Revenue per occupied
bed |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rental revenue per
occupied bed per month |
$466
|
|
$459
|
|
$7
|
|
1.5%
|
|
$463
|
|
$448
|
|
$15
|
|
3.3%
|
Services revenue
per occupied bed per month |
52
|
|
41
|
|
11
|
|
28.4%
|
|
37
|
|
40
|
|
(3) |
|
(7.5%) |
Total revenue per
occupied bed |
$518
|
|
$500
|
|
$18
|
|
3.7%
|
|
$500
|
|
$488
|
|
$12
|
|
2.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average number of
owned beds |
17,071
|
|
16,647
|
|
|
|
|
|
16,786
|
|
16,647
|
|
|
|
|
Average physical
occupancy |
91.1% |
|
90.1% |
|
|
|
1.0%
|
|
90.4% |
|
92.3% |
|
|
|
(1.9%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue |
$24,133
|
|
$22,499
|
|
$1,634
|
|
7.3%
|
|
$68,340
|
|
$49,400
|
|
$18,940
|
|
38.3%
|
Property operating
expenses |
9,248
|
|
9,684
|
|
(436) |
|
(4.5%) |
|
26,729
|
|
19,050
|
|
7,679
|
|
40.3%
|
Net operating income |
$14,885
|
|
$12,815
|
|
$2,070
|
|
16.2%
|
|
$41,611
|
|
$30,350
|
|
$11,261
|
|
37.1%
|
Operating
margin2 |
61.7% |
|
57.0% |
|
|
|
4.7%
|
|
60.9% |
|
61.4% |
|
|
|
(0.5%) |
1 For the three and nine months ended September
30, 2013, excludes The Grove at Denton; the Company acquired its joint venture partner's interest in this property on January 21,
2014.
2 Operating margin is calculated by dividing
NOI for the period by total student housing rental and services revenues for the period. Expenses include property management fees.
3 For the three and nine months ended September
30, 2014, includes financial results for the 2013 joint venture deliveries (The Grove at Indiana, The Grove at Norman, and The
Grove at State College) as well as the 2014 joint venture deliveries (The Grove at Greensboro, The Grove at Louisville, evo at
Cira Centre South, evo à Square Victoria and evo à Sherbrooke).
4 As of September 30, 2014, the Company
held preferred investment in The Grove at Indiana, The Grove at Greensboro and The Grove at Louisville of approximately $7,322.
This preferred interest entitles the Company to a 9.0% return on the investment but otherwise does not change its effective ownership
interest in these properties.
5 As of September 30, 2013, the Company
held preferred investment in The Grove at San Angelo, The Grove at Conway and The Grove at Indiana of approximately $11,827. These
preferred interests entitle the Company to a 9.0% return on the investment but otherwise do not change its effective ownership
interest in these properties. In January 2014, the Company amended and restated the HSRE-Campus Crest I, LLC operating agreement,
which related to The Grove at San Angelo and The Grove at Conway, which had the effect of exchanging its Class B member preferred
interests for limited partnership units, effectively increasing its equity investment in the joint venture to 63.9% from 49.9%.
In the event of a sale, the partners are to share equally in the net proceeds. There were no other material changes to the agreement.
6 For the three months ended September
30, 2014, results reflect operating results for the 36 operating properties. Results include Copper Beech at Ames, which is the
only Copper Beech property included in our consolidated results.
7 For nine months ended September 30, 2013,
includes 91 days of results from the Company’s initial investment in Copper Beech on March 18, 2013, which equates to an
effective 29% ownership interest in 33 operating properties.
8 The Company made its initial investment
in Copper Beech on March 18, 2013 and subsequently made additional investments. On September 30, 2013, the Company entered into
an amendment to the purchase and sale agreement that, subject to receipt of required third-party lender consents, enabled the Company
to acquire a 67% ownership interest in 28 operating properties, while deferring ownership in seven properties until the Company
exercises future purchase options. On August 18, 2014, the Company elected to not exercise the first purchase option and reverted
to a 48% interest ownership interest in 35 operating properties. As of September 30, 2014, the Company held a 48% effective interest
in 35 operating and two non-operating properties which are unconsolidated and a 48% interest in one consolidated operating property.
CAMPUS
CREST COMMUNITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CAPITAL STRUCTURE AS OF SEPTEMBER 30, 2014 |
|
|
|
|
|
|
(in $000s, except per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Closing common stock price at September 30, 2014 |
|
|
|
$6.40 |
|
|
|
|
|
|
|
|
|
Common stock |
|
|
|
64,108 |
|
|
Operating partnership units |
|
|
|
434 |
|
|
Restricted stock |
|
|
|
671 |
|
|
Total shares and units outstanding |
|
|
|
65,213 |
|
|
|
|
|
|
|
|
|
Total equity market value |
|
|
|
$417,366 |
|
|
Total preferred equity outstanding |
|
|
|
152,500 |
|
|
Total consolidated debt outstanding |
|
|
|
580,274 |
|
|
Total market capitalization |
|
|
|
$1,150,140 |
|
|
|
|
|
|
|
|
|
Debt to total market capitalization |
|
|
|
50.5% |
|
|
Debt to gross assets1 |
|
|
|
44.1% |
|
|
|
|
|
|
|
|
|
Total number of unencumbered wholly owned operating properties |
|
|
|
19 |
|
|
|
|
|
|
Weighted |
|
Average |
|
Principal |
% of Total |
|
Average |
|
Years to |
Consolidated Debt 2, 3 |
Outstanding |
Principal Outstanding |
|
Interest Rate |
|
Maturity |
|
|
|
|
|
|
|
Fixed rate mortgage loans |
163,909 |
28.2% |
|
4.95% |
|
4.7 |
Variable rate mortgage loan |
16,677 |
2.9% |
|
2.31% |
|
2.4 |
Construction loans |
98,566 |
17.0% |
|
2.27% |
|
1.5 |
Variable rate credit facility |
201,000 |
34.6% |
|
2.35% |
|
2.3 |
Exchangeable Notes |
97,244 |
16.8% |
|
5.53% |
|
4.0 |
Other debt |
2,878 |
0.5% |
|
4.92% |
|
14.4 |
Total/Weighted Average |
$580,274 |
100.0% |
|
3.62% |
|
3.2 |
1 Gross assets is defined as total assets plus accumulated
depreciation, as reported in the Company's September 30, 2014 consolidated balance sheet.
2 Excludes $251,850 of debt associated with HSRE
joint ventures and $77,993 associated with Beaumont joint ventures. See page 16 for this debt. The Company is the guarantor of
these loans.
3 Excludes debt associated with the Company’s
investment in Copper Beech. See page 17 for this debt.
CAMPUS
CREST COMMUNITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OUTSTANDING DEBT AND MATURITY SCHEDULE |
|
|
|
|
|
|
|
|
|
(in $000s) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principal Balance at |
|
Interest Rate |
|
Maturity |
|
Years to |
|
|
|
Consolidated Debt |
|
|
9/30/2014 |
|
|
Date |
|
Maturity |
|
|
Notes |
|
|
|
|
|
|
|
|
|
|
|
|
|
Credit facility |
|
|
$201,000 |
|
2.35% |
|
1/8/2017 |
|
2.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exchangeable notes1 |
|
|
97,244 |
|
5.53% |
|
10/9/2018 |
|
4.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other debt |
|
|
|
|
|
|
|
|
|
|
|
|
Microsoft 365 Capital Lease |
|
|
570 |
|
4.62% |
|
4/30/2017 |
|
2.6 |
|
|
Miscellaneous debt |
Flagstaff Municiple Bond |
|
|
2,308 |
|
5.00% |
|
10/31/2031 |
|
17.3 |
|
|
Miscellaneous debt |
|
|
|
|
|
|
|
|
|
|
|
|
|
Sub Total / Weighted Average |
|
|
$2,878 |
|
4.92% |
|
|
|
14.4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Construction loans |
|
|
|
|
|
|
|
|
|
|
|
|
The Grove at Ft. Collins |
|
|
19,073 |
|
2.06% |
|
7/13/2015 |
|
0.8 |
|
|
Two twelve month extension options |
The Grove at Muncie |
|
|
13,892 |
|
2.41% |
|
7/3/2015 |
|
0.8 |
|
|
Two twelve month extension options |
The Grove at Pullman |
|
|
10,866 |
|
2.36% |
|
9/5/2015 |
|
0.9 |
|
|
Two twelve month extension options |
The Grove at Slippery Rock |
|
|
11,690 |
|
2.31% |
|
6/21/2016 |
|
1.8 |
|
|
Two twelve month extension options |
The Grove at Grand Forks |
|
|
12,457 |
|
2.16% |
|
2/5/2017 |
|
2.4 |
|
|
One eighteen month extension option |
The Grove at Gainesville |
|
|
16,225 |
|
2.31% |
|
3/13/2017 |
|
2.5 |
|
|
Two twelve month extension options |
Copper Beech at Ames, IA |
|
|
14,363 |
|
2.40% |
|
5/2/2017 |
|
2.6 |
|
|
Two twelve month extension options |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sub Total / Weighted Average |
|
|
$98,566 |
|
2.27% |
|
|
|
0.8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage loans |
|
|
|
|
|
|
|
|
|
|
|
|
The Grove at Milledgeville |
|
|
$15,694 |
|
6.12% |
|
10/1/2016 |
|
2.0 |
|
|
Principal and interest |
The Grove at Las Cruces |
|
|
14,623 |
|
6.13% |
|
10/11/2016 |
|
2.1 |
|
|
Principal and interest |
The Grove at Carrollton |
|
|
14,149 |
|
6.13% |
|
10/11/2016 |
|
2.1 |
|
|
Principal and interest |
The Grove at Denton |
|
|
16,677 |
|
2.31% |
|
3/1/2017 |
|
2.5 |
|
|
Principal and interest, floating rate |
The Grove at Asheville |
|
|
14,355 |
|
5.77% |
|
4/11/2017 |
|
2.6 |
|
|
Principal and interest |
The Grove at Nacogdoches |
|
|
16,919 |
|
5.01% |
|
9/1/2018 |
|
4.0 |
|
|
Principal and interest |
The Grove at Ellensburg |
|
|
15,903 |
|
5.10% |
|
9/1/2018 |
|
4.0 |
|
|
Principal and interest |
The Grove at Greeley |
|
|
15,009 |
|
4.29% |
|
10/1/2018 |
|
4.1 |
|
|
Principal and interest |
The Grove at Columbia |
|
|
22,851 |
|
3.83% |
|
7/1/2022 |
|
7.9 |
|
|
Principal and interest |
The Grove at Clarksville |
|
|
16,307 |
|
4.03% |
|
7/1/2022 |
|
7.9 |
|
|
Principal and interest |
The Grove at Statesboro |
|
|
18,100 |
|
4.01% |
|
1/1/2023 |
|
8.4 |
|
|
Interest only until 1/2015 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Sub Total / Weighted Average |
|
|
$180,587 |
|
4.71% |
|
|
|
4.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total / Weighted Average |
|
|
$580,274 |
|
3.62% |
|
|
|
3.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Face rate on note is 4.75%.
2 Excludes principal amortization and extension options.
CAMPUS
CREST COMMUNITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
HSRE & BEAUMONT JOINT VENTURE DEBT SUMMARY |
|
|
|
|
|
|
|
(in $000s) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principal Balance |
Interest Rate |
Maturity |
Years to |
|
|
Property |
Ownership |
|
9/30/2014 |
Date |
Maturity |
|
Notes |
|
|
|
|
|
|
|
|
|
The Grove at Fayetteville |
10.0% |
|
$ 19,078 |
2.90% |
12/21/2014 |
0.2 |
|
Interest only |
The Grove at Stillwater |
10.0% |
|
13,325 |
2.90% |
12/20/2014 |
0.2 |
|
Interest only |
The Grove at Laramie |
10.0% |
|
17,211 |
2.80% |
1/5/2015 |
0.3 |
|
Interest only |
The Grove at Lawrence |
63.9% |
|
11,492 |
2.66% |
2/9/2015 |
0.4 |
|
Interest only |
The Grove at San Angelo |
63.9% |
|
11,166 |
2.66% |
2/9/2015 |
0.4 |
|
Interest only |
The Grove at Conway |
63.9% |
|
9,827 |
2.66% |
2/9/2015 |
0.4 |
|
Interest only |
The Grove at Norman |
20.0% |
|
17,871 |
2.80% |
5/8/2015 |
0.6 |
|
Interest only |
The Grove at State College |
20.0% |
|
18,619 |
2.20% |
9/30/2015 |
1.0 |
|
Interest only |
The Grove at Indiana |
20.0% |
|
17,217 |
2.40% |
12/19/2015 |
1.2 |
|
Interest only |
evo à Square Victoria and evo à Sherbrooke1 |
35.0% |
|
77,993 |
6.38% |
1/13/2016 |
1.3 |
|
Interest only |
evo at Cira Centre South |
30.0% |
|
81,115 |
2.35% |
7/25/2016 |
1.8 |
|
Interest only |
The Grove at Louisville |
30.0% |
|
19,357 |
2.40% |
9/6/2016 |
1.9 |
|
Interest only |
The Grove at Greensboro |
30.0% |
|
15,572 |
2.25% |
9/30/2018 |
4.0 |
|
Interest only |
|
|
|
|
|
|
|
|
|
Total / Weighted Average |
|
|
$329,843 |
3.43% |
|
1.3 |
|
|
|
|
|
|
|
|
|
|
|
Note: The Company's pro rata share of HSRE and Beaumont joint
venture debt as of June 30, 2014 was $98,571.
1 In January 2014, the joint venture repaid the bridge
loan with a C$112,000 development loan for both evo à Square Victoria and evo à Sherbrooke.
CAMPUS
CREST COMMUNITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COPPER BEECH JOINT VENTURE DEBT SUMMARY |
|
|
|
|
|
|
|
|
(in $000s) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effective |
|
Principal Balance |
Interest Rate |
Maturity |
Years to |
|
|
Property |
Ownership1 |
|
9/30/2014 |
Date |
Maturity |
|
Notes |
|
|
|
|
|
|
|
|
|
Unconsolidated Properties: 48% Effective Ownership Interest |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Copper Beech at West Lafayette, IN – Baywater2 |
48.0% |
|
$13,952
|
5.2% |
10/11/2014 |
0.0 |
|
Principal and interest |
Copper Beech at Statesboro, GA - Phase II2 |
48.0% |
|
9,703 |
2.7% |
11/1/2014 |
0.1 |
|
Principal and interest |
Copper Beech at Mount Pleasant, MI - Phase II |
48.0% |
|
10,130 |
2.7% |
2/1/2015 |
0.3 |
|
Principal and interest |
Copper Beech at State College, PA - Parkway Plaza |
48.0% |
|
18,375 |
5.2% |
10/1/2015 |
1.0 |
|
Principal and interest |
Copper Beech at Indiana, PA - IUP II |
48.0% |
|
5,939 |
5.9% |
10/1/2015 |
1.0 |
|
Principal and interest |
Copper Beech at Mount Pleasant, MI - Phase I |
48.0% |
|
18,266 |
5.5% |
10/1/2015 |
1.0 |
|
Principal and interest |
Copper Beech at Bowling Green, OH - Phase I |
48.0% |
|
12,318 |
5.6% |
10/1/2015 |
1.0 |
|
Principal and interest |
Copper Beech at State College, PA - CB I |
48.0% |
|
4,998 |
5.6% |
2/11/2016 |
1.4 |
|
Principal and interest |
Copper Beech at Indiana, PA - IUP Buy |
48.0% |
|
2,345 |
5.5% |
6/6/2016 |
1.7 |
|
Principal and interest |
Copper Beech at Morgantown, WV |
48.0% |
|
34,885 |
5.5% |
6/6/2016 |
1.7 |
|
Principal and interest |
Copper Beech at Harrisonburg, VA |
48.0% |
|
53,785 |
5.5% |
6/6/2016 |
1.7 |
|
Principal and interest |
Copper Beech at San Marcos, TX - Phase I |
48.0% |
|
33,251 |
5.5% |
6/6/2016 |
1.7 |
|
Principal and interest |
Copper Beech at Bloomington, IN |
48.0% |
|
10,496 |
6.2% |
10/1/2016 |
2.0 |
|
Principal and interest |
Copper Beech at Allendale, MI - Phase I |
48.0% |
|
22,942 |
6.0% |
10/1/2016 |
2.0 |
|
Principal and interest |
Copper Beech at Columbia, MO |
48.0% |
|
23,694 |
6.2% |
10/1/2016 |
2.0 |
|
Principal and interest |
Copper Beech at Radford, VA |
48.0% |
|
11,976 |
6.0% |
11/6/2016 |
2.1 |
|
Principal and interest |
Copper Beech at Indiana, PA - IUP I |
48.0% |
|
6,500 |
2.2% |
6/2/2017 |
2.7 |
|
Principal and interest |
Copper Beech at Allendale, MI - Phase II |
48.0% |
|
11,631 |
6.3% |
9/6/2017 |
2.9 |
|
Principal and interest |
Copper Beech at Columbia, SC - Phase I |
48.0% |
|
36,113 |
6.3% |
9/6/2017 |
2.9 |
|
Principal and interest |
Copper Beech at Statesboro, GA - Phase I |
48.0% |
|
30,275 |
5.8% |
10/6/2017 |
3.0 |
|
Principal and interest |
Copper Beech at Kalamazoo, MI - Phase I |
48.0% |
|
29,738 |
5.8% |
10/6/2017 |
3.0 |
|
Principal and interest |
Copper Beech at State College, PA - CB II |
48.0% |
|
8,475 |
6.0% |
8/1/2019 |
4.8 |
|
Principal and interest |
Copper Beech at Columbia, SC - Phase II |
48.0% |
|
5,939 |
5.4% |
8/1/2020 |
5.8 |
|
Principal and interest |
Copper Beech at Greenville, NC |
48.0% |
|
46,900 |
5.3% |
9/1/2020 |
5.9 |
|
Principal and interest |
Copper Beech at State College, PA - Oakwood |
48.0% |
|
5,592 |
5.0% |
10/1/2020 |
6.0 |
|
Principal and interest |
Copper Beech at Kalamazoo, MI - Phase II |
48.0% |
|
7,869 |
5.7% |
10/1/2020 |
6.0 |
|
Principal and interest |
|
|
|
|
|
|
|
|
|
Sub-Total / Weighted Average |
|
|
$476,084 |
5.50% |
|
2.5 |
|
|
|
|
|
|
|
|
|
|
|
Consolidated Property: 48% Ownership Interest |
|
|
|
|
|
|
|
|
Copper Beech at Ames, IA |
48.0% |
|
$14,363 |
2.4% |
5/2/2017 |
2.6 |
|
Principal and interest |
|
|
|
|
|
|
|
|
|
Total / Weighted Average |
|
|
$490,447 |
5.41% |
|
2.5 |
|
|
|
|
|
|
|
|
|
|
|
Note: The Company's pro rata share of Copper Beech debt as
of September 30, 2014 was $238,144.
1 The Company made its initial investment in Copper
Beech on March 18, 2013 and subsequently made additional investments. On September 30, 2013, the Company entered into an amendment
to the purchase and sale agreement that, subject to receipt of required third-party lender consents, enabled the Company to acquire
a 67% ownership interest in 28 operating properties, while deferring ownership in seven properties until the Company exercises
future purchase options. On August 18, 2014, the Company elected to not exercise the first purchase option and reverted to a 48%
interest ownership interest in 35 operating properties. As of September 30, 2014, the Company held a 48% effective interest in
35 operating and two non-operating properties which are unconsolidated and a 48% interest in one consolidated operating property.
2 Extensions to the maturity dates for Copper Beech at West
Lafyette, IN and Copper Beech at Statesboro, GA - Phase II properties are in process.
CAMPUS
CREST COMMUNITIES |
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|
PORTFOLIO OVERVIEW AND OCCUPANCY |
|
|
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|
|
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Occupancy
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September
30, |
|
Property |
Grouping1 |
|
Primary
University |
Year Opened/
Acquired |
Properties |
Units
|
Beds
|
2014 |
2013 |
Change |
Rental
Rate
Change4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Wholly
Owned Operating Properties |
|
|
|
|
|
|
|
|
|
|
|
|
The
Grove at Asheville, NC |
(A) |
|
UNC
- Asheville |
2005 |
|
154
|
448
|
100.0% |
98.4% |
1.6%
|
|
4.1%
|
The
Grove at Carrollton, GA |
(A) |
|
University
of West Georgia |
2006 |
|
168
|
492
|
92.1% |
98.2% |
(6.2%) |
|
0.9%
|
The
Grove at Las Cruces, NM |
(A) |
|
New
Mexico State University |
2006 |
|
168
|
492
|
82.3% |
82.1% |
0.2%
|
|
(0.0%) |
The
Grove at Milledgeville, GA |
(A) |
|
Georgia
College & State University |
2006 |
|
168
|
492
|
100.0% |
98.8% |
1.2%
|
|
2.8%
|
The
Grove at Abilene, TX |
(A) |
|
Abilene
Christian University |
2007 |
|
192
|
504
|
90.5% |
93.1% |
(2.6%) |
|
2.5%
|
The
Grove at Ellensburg, WA |
(A) |
|
Central
Washington University |
2007 |
|
192
|
504
|
99.4% |
98.2% |
1.2%
|
|
3.1%
|
The
Grove at Greeley, CO |
(A) |
|
University
of Northern Colorado |
2007 |
|
192
|
504
|
100.0% |
99.1% |
0.9%
|
|
2.8%
|
The
Grove at Mobile, AL--Phase I & II2 |
(A) |
|
University
of South Alabama |
2007/2008 |
|
384
|
1,008
|
85.3% |
79.2% |
6.1%
|
|
0.5%
|
The
Grove at Nacogdoches, TX--Phase I & II2 |
(A) |
|
Stephen
F. Austin State Univ. |
2007/2012 |
|
260
|
682
|
83.1% |
85.8% |
(2.7%) |
|
(0.4%) |
The
Grove at Cheney, WA |
(A) |
|
Eastern
Washington University |
2008 |
|
192
|
512
|
93.4% |
94.4% |
(1.1%) |
|
0.2%
|
The
Grove at Lubbock, TX |
(A) |
|
Texas
Tech University |
2008 |
|
192
|
504
|
91.9% |
91.8% |
0.1%
|
|
2.5%
|
The
Grove at Stephenville, TX |
(A) |
|
Tarleton
State University |
2008 |
|
192
|
504
|
100.0% |
89.4% |
10.6%
|
|
(0.8%) |
The
Grove at Troy, AL |
(A) |
|
Troy
University |
2008 |
|
192
|
514
|
97.5% |
91.7% |
5.8%
|
|
3.5%
|
The
Grove at Waco, TX |
(A) |
|
Baylor
University |
2008 |
|
192
|
504
|
90.1% |
89.5% |
0.6%
|
|
(1.6%) |
The
Grove at Murfreesboro, TN |
(A) |
|
Middle
Tennessee State University |
2009 |
|
186
|
504
|
99.6% |
95.7% |
4.0%
|
|
3.0%
|
The
Grove at San Marcos, TX |
(A) |
|
Texas
State University |
2009 |
|
192
|
504
|
95.7% |
98.9% |
(3.2%) |
|
0.1%
|
The
Grove at Moscow, ID |
(A) |
|
University
of Idaho |
2009 |
|
192
|
504
|
84.1% |
97.0% |
(12.9%) |
|
(5.8%) |
The
Grove at Huntsville, TX |
(A) |
|
Sam
Houston State University |
2010 |
|
192
|
504
|
100.0% |
99.3% |
0.7%
|
|
3.2%
|
The
Grove at Statesboro, GA |
(A) |
|
Georgia
Southern University |
2010 |
|
200
|
536
|
85.8% |
72.9% |
12.9%
|
|
(1.3%) |
The
Grove at Ames, IA |
(A) |
|
Iowa
State University |
2011 |
|
216
|
584
|
100.0% |
99.6% |
0.4%
|
|
1.8%
|
The
Grove at Clarksville, TN |
(A) |
|
Austin
Peay State University |
2011 |
|
208
|
560
|
73.9% |
82.7% |
(8.8%) |
|
2.7%
|
The
Grove at Columbia, MO |
(A) |
|
University
of Missouri |
2011 |
|
216
|
632
|
73.9% |
66.0% |
7.9%
|
|
2.5%
|
The
Grove at Ft. Wayne, IN |
(A) |
|
Indiana
University-Purdue University Ft. Wayne |
2011 |
|
204
|
540
|
74.8% |
91.8% |
(17.1%) |
|
1.8%
|
The
Grove at Valdosta, GA |
(A) |
|
Valdosta
State University |
2011 |
|
216
|
584
|
86.5% |
86.7% |
(0.3%) |
|
3.3%
|
The
Grove at Denton, TX |
(A) |
|
University
of North Texas |
2011 |
|
216
|
584
|
99.2% |
91.4% |
7.8%
|
|
2.4%
|
The
Grove at Auburn, AL |
(A) |
|
Auburn
University |
2012 |
|
216
|
600
|
100.0% |
99.6% |
0.4%
|
|
3.4%
|
The
Grove at Flagstaff, AZ |
(A) |
|
Northern
Arizona University |
2012 |
|
216
|
584
|
99.5% |
99.0% |
0.5%
|
|
5.0%
|
The
Grove at Orono, ME |
(A) |
|
University
of Maine |
2012 |
|
188
|
620
|
100.0% |
91.1% |
8.9%
|
|
2.8%
|
The
Grove at Ft. Collins, CO |
(B) |
|
Colorado
State University |
2013 |
|
218
|
612
|
100.0% |
99.7% |
0.3%
|
|
4.4%
|
The
Grove at Muncie, IN |
(B) |
|
Ball
State University |
2013 |
|
216
|
584
|
85.5% |
68.1% |
17.5%
|
|
2.4%
|
The
Grove at Pullman, WA3 |
(B) |
|
Washington
State University |
2013 |
|
216
|
584
|
100.0% |
100.0% |
0.0%
|
|
5.3%
|
The
Grove at Flagstaff, AZ - Phase II2 |
(B) |
|
Northern
Arizona University |
2013 |
|
54
|
192
|
100.0% |
99.1% |
0.9%
|
|
(0.0%) |
The
Grove at Gainesville, FL |
(C) |
|
University
of Florida |
2014 |
|
256
|
682
|
54.1% |
n/a |
n/a |
|
n/a |
The
Grove at Grand Forks, ND |
(C) |
|
University
of North Dakota |
2014 |
|
224
|
600
|
99.7% |
n/a |
n/a |
|
n/a |
The
Grove at Mt. Pleasant, MI |
(C) |
|
Central
Michigan University |
2014 |
|
224
|
584
|
76.2% |
n/a |
n/a |
|
n/a |
The
Grove at Slippery Rock, PA |
(C) |
|
Slippery
Rock University |
2014 |
|
201
|
603
|
85.4% |
n/a |
n/a |
|
n/a |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
- Wholly Owned Operating Properties |
|
|
|
|
36
|
7,305
|
19,945
|
90.4% |
90.8% |
(0.4%) |
|
2.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Groupings detailed as follows: (A) reflects the
same store properties as of June 30, 2014; (B) reflects the 2013 development deliveries; (C) reflects the 2014 development deliveries.
2 The Grove at Mobile, AL--Phase I & II are counted
as two properties in the Company's property count. The Grove at Nacogdoches, TX - Phase II and The Grove at Flagstaff, AZ - Phase
II are not counted as a separate assets from Phase I of each respective asset.
3 On July 14, 2013, the Company experienced a fire
at this development. The Company has reached a resolution with its insurance provider and while no assurances can be given, after
taking into account its existing insurance coverage, it believes that the damages sustained as a result of this fire will not have
a material adverse effect on its financial position or results of operations. As of September 30, 2014, all 584 beds are in operation.
4 Rental rate for 2014/2015 academic year over 2013/2014
academic year achieved rental RevPOB.
CAMPUS CREST COMMUNITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PORTFOLIO OVERVIEW AND OCCUPANCY (cont'd) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Occupancy |
|
|
|
|
|
|
|
|
|
|
September 30, |
|
Rental Rate |
Property |
Grouping1 |
|
Primary
University |
Year
Opened/Acquired |
Properties |
Units
|
Beds
|
2014 |
2013 |
Change |
|
Change2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Joint
Venture Operating Properties |
|
|
|
|
|
|
|
|
|
|
|
|
The
Grove at Lawrence, KS |
(A) |
|
University
of Kansas |
2009 |
|
172
|
500
|
73.2% |
84.0% |
(10.8%) |
|
(2.1%) |
The
Grove at San Angelo, TX |
(A) |
|
Angelo
State University |
2009 |
|
192
|
504
|
98.4% |
96.6% |
1.8%
|
|
2.1%
|
The
Grove at Conway, AR |
(A) |
|
University
of Central Arkansas |
2010 |
|
180
|
504
|
71.3% |
69.5% |
1.8%
|
|
1.6%
|
The
Grove at Fayetteville, AR |
(A) |
|
University
of Arkansas |
2012 |
|
232
|
632
|
66.0% |
56.0% |
10.1%
|
|
2.9%
|
The
Grove at Laramie, WY |
(A) |
|
University
of Wyoming |
2012 |
|
224
|
612
|
87.1% |
83.2% |
3.8%
|
|
1.5%
|
The
Grove at Stillwater, OK |
(A) |
|
Oklahoma
State University |
2012 |
|
206
|
612
|
87.2% |
96.3% |
(9.1%) |
|
2.7%
|
The
Grove at Indiana, PA |
(B) |
|
Indiana
University of Pennsylvania |
2013 |
|
224
|
600
|
64.8% |
89.5% |
(24.7%) |
|
0.2%
|
The
Grove at Norman, OK |
(B) |
|
University
of Oklahoma |
2013 |
|
224
|
600
|
71.9% |
81.7% |
(9.8%) |
|
3.4%
|
The
Grove at State College, PA |
(B) |
|
Penn
State University |
2013 |
|
216
|
584
|
100.0% |
69.2% |
30.8%
|
|
4.5%
|
The
Grove at Greensboro, NC |
(C) |
|
University of
North Carolina at Greensboro |
2014 |
|
216
|
584
|
57.4% |
n/a |
n/a |
|
n/a |
The
Grove at Louisville, KY |
(C) |
|
University
of Louisville |
2014 |
|
252
|
656
|
61.0% |
n/a |
n/a |
|
n/a |
evo
at Cira Centre South |
(C) |
|
University
of Pennsylvania / Drexel University |
2014 |
|
344
|
819
|
48.4% |
n/a |
n/a |
|
n/a |
evo
à Square Victoria |
(C) |
|
Concordia
University / McGill University / (ÉTS) |
2014 |
|
715
|
1,294
|
13.0% |
n/a |
n/a |
|
n/a |
evo
à Sherbrooke |
(C) |
|
McGill
University |
2014 |
|
488
|
929
|
8.0% |
n/a |
n/a |
|
n/a |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
- Joint Venture Operating Properties |
|
|
|
|
14
|
3,885
|
9,430
|
58.1% |
80.4% |
(22.3%) |
|
2.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Operating Properties3 |
|
|
|
|
50
|
11,190
|
29,375
|
80.0%
|
88.4% |
(8.4%) |
|
2.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Same
Store Properties (A) |
|
|
|
|
|
|
|
|
|
|
|
|
Wholly-Owned |
|
|
|
|
29
|
5,696
|
15,504
|
91.7% |
90.8% |
0.9%
|
|
1.8%
|
Joint
Venture |
|
|
|
|
6
|
1,206
|
3,364
|
80.4% |
80.5% |
(0.1%) |
|
1.9%
|
Total
- Same Store |
|
|
|
|
35
|
6,902
|
18,868
|
89.7% |
89.0% |
0.7%
|
|
1.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2013
Deliveries (B) |
|
|
|
|
|
|
|
|
|
|
|
|
Wholly-Owned |
|
|
|
|
3
|
704
|
1,972
|
95.7% |
90.4% |
5.3%
|
|
3.0%
|
Joint
Venture |
|
|
|
|
3
|
664
|
1,784
|
78.7% |
80.2% |
(1.5%) |
|
4.3%
|
Total
- 2013 Deliveries |
|
|
|
|
6
|
1,368
|
3,756
|
87.7% |
85.5% |
2.2%
|
|
3.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2014
Deliveries (C)4 |
|
|
|
|
|
|
|
|
|
|
|
|
Wholly-Owned |
|
|
|
|
4
|
905
|
2,469
|
78.0% |
n/a |
n/a |
|
n/a |
Joint
Venture |
|
|
|
|
5
|
2,015
|
4,282
|
32.1% |
n/a |
n/a |
|
n/a |
Total
- 2014 Deliveries |
|
|
|
|
9
|
2,920
|
6,751
|
48.9% |
n/a |
n/a |
|
n/a |
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Groupings detailed as follows: (A) reflects the
same store properties as of June 30, 2014; (B) reflects the 2013 development deliveries; (C) reflects the 2014 development deliveries.
2 Rental rate for 2014/2015 academic year over 2013/2014
academic year achieved rental RevPOB.
3 The redevelopment of the 100% owned property in
Toledo, OH is excluded. The Grove at Denton is included for purposes of this presentation. The Company acquired its joint venture
partner's interest in this property on January 21, 2014. The occupancy data related to Denton is included in Same Store.
4 Does not include the Copper Beech at Ames 2014
delivery. CB Ames is included on page 20.
CAMPUS
CREST COMMUNITIES |
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|
COPPER BEECH PORTFOLIO OVERVIEW AND OCCUPANCY1 |
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|
Occupancy
|
|
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|
|
September
30, |
|
Property |
|
Primary
University |
Year Opened/
Acquired |
|
Properties |
Units
|
Beds
|
|
2014 |
|
2013 |
Change |
Rental Rate
Change2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unconsolidated
Properties: 48% Effective Ownership Interest |
|
|
|
|
|
|
|
|
|
|
|
|
|
Copper
Beech at State College, PA - CB I |
|
Penn
State University |
1996 |
|
|
59
|
177
|
|
100.0% |
|
91.5% |
8.5%
|
(4.3%) |
Copper
Beech at State College, PA - CB II |
|
Penn
State University |
1998 |
|
|
87
|
257
|
|
100.0% |
|
93.4% |
6.6%
|
(2.2%) |
Copper
Beech at State College, PA - Oakwood |
|
Penn
State University |
2000 |
|
|
48
|
144
|
|
99.3% |
|
77.1% |
22.2%
|
(3.9%) |
Copper
Beech at State College, PA - Northbrook Greens |
|
Penn
State University |
2003 |
|
|
166
|
250
|
|
100.0% |
|
100.0% |
0.0%
|
0.9%
|
Copper
Beech at State College, PA - Parkway Plaza |
|
Penn
State University |
1967 |
|
|
429
|
633
|
|
98.7% |
|
86.3% |
12.5%
|
(4.0%) |
Copper
Beech at Indiana, PA - IUP I |
|
Indiana
University of Pennsylvania |
1971 |
|
|
95
|
239
|
|
100.0% |
|
100.0% |
0.0%
|
4.2%
|
Copper
Beech at Indiana, PA - IUP II |
|
Indiana
University of Pennsylvania |
1973 |
|
|
72
|
172
|
|
100.0% |
|
100.0% |
0.0%
|
3.7%
|
Copper
Beech at Indiana, PA - IUP Buy |
|
Indiana
University of Pennsylvania |
1975 |
|
|
43
|
76
|
|
97.3% |
|
97.4% |
(0.1%) |
(5.1%) |
Copper
Beech at Radford, VA |
|
Radford
University |
2005 |
|
|
222
|
500
|
|
100.0% |
|
100.0% |
0.0%
|
3.0%
|
Copper
Beech at West Lafayette, IN – Klondike |
|
Purdue
University |
2003 |
|
|
219
|
486
|
|
86.6% |
|
91.2% |
(4.5%) |
(1.7%) |
Copper
Beech at West Lafayette, IN – Baywater |
|
Purdue
University |
2004 |
|
|
137
|
488
|
|
72.3% |
|
99.4% |
(27.0%) |
(0.6%) |
Copper
Beech at Bloomington, IN |
|
Indiana
University |
2005 |
|
|
107
|
297
|
|
71.0% |
|
83.5% |
(12.5%) |
2.8%
|
Copper
Beech at Mount Pleasant, MI - Phase I |
|
Central
Michigan University |
2005 |
|
|
204
|
632
|
|
98.6% |
|
100.0% |
(1.4%) |
(2.4%) |
Copper
Beech at Mount Pleasant, MI - Phase II |
|
Central
Michigan University |
2013 |
|
|
119
|
256
|
|
100.0% |
|
35.9% |
64.1%
|
(7.2%) |
Copper
Beech at Fresno, CA |
|
California
State University at Fresno |
2006 |
|
|
178
|
506
|
|
90.3% |
|
86.2% |
4.2%
|
(3.2%) |
Copper
Beech at Bowling Green, OH - Phase I |
|
Bowling
Green University |
2005 |
|
|
128
|
400
|
|
99.8% |
|
99.2% |
0.5%
|
0.5%
|
Copper
Beech at Bowling Green, OH - Phase II |
|
Bowling
Green University |
2007 |
|
|
72
|
216
|
|
100.0% |
|
98.1% |
1.9%
|
(5.4%) |
Copper
Beech at Allendale, MI - Phase I |
|
Grand
Valley State University |
2006 |
|
|
206
|
614
|
|
100.0% |
|
100.0% |
0.0%
|
(0.4%) |
Copper
Beech at Allendale, MI - Phase II |
|
Grand
Valley State University |
2007 |
|
|
82
|
290
|
|
100.0% |
|
100.0% |
0.0%
|
(1.0%) |
Copper
Beech at Columbia, MO |
|
University of
Missouri |
2006 |
|
|
214
|
654
|
|
89.0% |
|
100.0% |
(11.0%) |
6.4%
|
Copper
Beech at Bloomington, IN - Colonial Crest |
|
Indiana
University |
1970 |
|
|
206
|
402
|
|
79.4% |
|
82.6% |
(3.2%) |
(5.8%) |
Copper
Beech at Columbia, SC - Phase I |
|
University
of South Carolina |
2007 |
|
|
278
|
824
|
|
97.3% |
|
100.0% |
(2.7%) |
(0.7%) |
Copper
Beech at Columbia, SC - Phase II |
|
University
of South Carolina |
2008 |
|
|
72
|
178
|
|
97.8% |
|
100.0% |
(2.2%) |
(1.1%) |
Copper
Beech at Morgantown, WV |
|
West
Virginia University |
2010 |
|
|
335
|
920
|
|
99.7% |
|
100.0% |
(0.3%) |
(0.0%) |
Copper
Beech at Harrisonburg, VA |
|
James
Madison University |
2008 |
|
|
414
|
1,218
|
|
100.0% |
|
100.0% |
0.0%
|
2.9%
|
Copper
Beech at Greenville, NC |
|
East
Carolina University |
2008 |
|
|
439
|
1,232
|
|
95.5% |
|
97.8% |
(2.4%) |
2.2%
|
Copper
Beech at San Marcos, TX - Phase I |
|
Texas
State University |
2011 |
|
|
273
|
840
|
|
89.8% |
|
92.7% |
(3.0%) |
7.6%
|
Copper
Beech at San Marcos, TX - Phase II |
|
Texas
State University |
2012 |
|
|
142
|
410
|
|
88.8% |
|
92.4% |
(3.7%) |
4.2%
|
Copper
Beech at Harrisonburg, VA - Grand Duke |
|
James
Madison University |
2001 |
|
|
120
|
124
|
|
100.0% |
|
100.0% |
0.0%
|
3.5%
|
Copper
Beech at State College, PA - Oak Hill |
|
Penn
State University |
2003 |
|
|
106
|
318
|
|
100.0% |
|
67.0% |
33.0%
|
(8.5%) |
Copper
Beech at Statesboro, GA - Phase I |
|
Georgia
Southern University |
2007 |
|
|
246
|
754
|
|
97.1% |
|
65.5% |
31.6%
|
(7.3%) |
Copper
Beech at Statesboro, GA - Phase II |
|
Georgia
Southern University |
2013 |
|
|
82
|
262
|
|
98.5% |
|
43.9% |
54.6%
|
(16.3%) |
Copper
Beech at Kalamazoo, MI - Phase I |
|
Western
Michigan University |
2007 |
|
|
256
|
784
|
|
82.0% |
|
85.1% |
(3.1%) |
3.1%
|
Copper
Beech at Kalamazoo, MI - Phase II |
|
Western
Michigan University |
2008 |
|
|
115
|
340
|
|
69.1% |
|
74.7% |
(5.6%) |
(0.8%) |
Copper
Beech at Auburn, AL |
|
Auburn
University |
2009 |
|
|
271
|
754
|
|
92.7% |
|
77.1% |
15.6%
|
(6.6%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sub-Total
/ Weighted Average |
|
|
|
|
35
|
6,242
|
16,647
|
|
93.7% |
|
90.6% |
3.1%
|
0.2%
|
|
|
|
|
|
. |
|
|
|
|
|
|
|
|
Consolidated
Property: 48% Ownership Interest2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Copper
Beech at Ames, IA |
|
Iowa State
University |
2014 |
|
1 |
219 |
660 |
|
77.9% |
|
n/a
|
n/a
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
- Copper Beech Portfolio |
|
|
|
|
36
|
6,461
|
17,307
|
|
93.1% |
|
90.6% |
2.5%
|
0.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 The Company made its initial investment in Copper
Beech on March 18, 2013 and subsequently made additional investments. On September 30, 2013, the Company entered into an amendment
to the purchase and sale agreement that, subject to receipt of required third-party lender consents, enabled the Company to acquire
a 67% ownership interest in 28 operating properties, while deferring ownership in seven properties until the Company exercises
future purchase options. On August 18, 2014, the Company elected to not exercise the first purchase option and reverted to a 48%
interest ownership interest in 35 operating properties. As of September 30, 2014, the Company held a 48% effective interest in
35 operating and two non-operating properties which are unconsolidated and a 48% interest in one consolidated operating property.
2 Reflected as of September 30, 2014.
3 Rental rate for 2014/2015 academic year over 2013/2014
academic year achieved rental RevPOB.
CAMPUS
CREST COMMUNITIES |
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|
INVESTOR INFORMATION |
|
|
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|
|
|
|
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|
|
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|
|
|
|
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|
|
|
|
|
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|
|
|
|
Executive
Management |
|
|
|
|
|
|
|
|
|
|
|
Ted W.
Rollins |
Chief Executive
Officer |
|
|
|
|
Donnie
L. Bobbitt |
Chief Financial
Officer |
|
|
|
|
Aaron Halfacre |
Chief Investment
Officer |
|
|
|
|
Scott Rochon |
Chief Accounting
Officer |
|
|
|
|
Angel Herrera |
Chief Operating
Officer |
|
|
|
|
|
|
|
|
|
|
Corporate
Headquarters |
|
|
Investor
Relations |
|
|
|
|
|
|
|
|
2100
Rexford Road #414 |
|
|
(704) 496-2571 |
|
|
Charlotte,
NC 28211 |
|
|
investor.relations@campuscrest.com |
|
|
(704) 496-2500 |
|
|
|
|
|
|
|
|
|
|
|
Covering
Analysts |
|
|
|
|
|
|
|
|
|
|
|
Barclays
Capital Inc. |
Ross Smotrich |
|
(212) 526-2306 |
|
ross.smotrich@barclays.com |
Citigroup Global
Markets Inc. |
Michael
Bilerman / Nick Joseph |
|
(212) 816-1383
/ (212) 816-1909 |
|
michael.bilerman@citi.com
/ nicholas.joseph@citi.com |
Goldman
Sachs & Co. |
Andrew
Rosivach |
|
(212) 902-2796 |
|
andrew.rosivach@gs.com
|
MLV &
Co LLC |
Ryan Meliker
/ Michael Kodesch |
|
(212) 542-5872
/ (646) 556-9188 |
|
rmeliker@mlvco.com
/ mkodesch@mlvco.com |
Raymond James
& Associates |
Paul D.
Puryear / Buck Horne |
|
(727) 567-2253
/ (727) 567-2561 |
|
paul.puryear@raymondjames.com
/ buck.horne@raymondjames.com |
RBC Capital
Markets, LLC |
Mike Salinsky
|
|
(440) 715-2648 |
|
mike.salinsky@rbccm.com |
Bank of
America Merrill Lynch |
Jana Galan
/ Jane Wong |
|
(646) 855-3081
/ (646) 855-3378 |
|
jana.galan@baml.com
/ jane.wong1@baml.com |
Wunderlich
Securities |
Craig Kucera |
|
(540) 277-3366 |
|
ckucera@wundernet.com |
Green Street
Advisors, Inc. |
Dave Bragg
/ Ryan Burke |
|
(949) 640-8780 |
|
dbragg@greenstreetadvisors.com
/ rburke@greenstreetadvisors.com |
CAMPUS
CREST COMMUNITIES |
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FORWARD - LOOKING STATEMENTS |
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This document, together with other statements and information
publicly disseminated by the Company, contains certain forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The Company intends such forward-looking
statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation
Reform Act of 1995 and includes this statement for purposes of complying with these safe harbor provisions. Forward-looking statements
relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions
concerning matters that are not historical facts. In some cases, you can identify forward-looking statements by the use of forward-looking
terminology such as “may,” “will,” “should,” “expects,” “intends,”
“plans,” “anticipates,” “believes,” “estimates,” “predicts” or “potential”
or the negative of these words and phrases or similar words or phrases which are predictions of or indicate future events or trends
and which do not relate solely to historical matters. Forward-looking statements in this press release include, among others, the
performance of properties in occupancy and yield targets, outlook and guidance for full-year 2014 FFO and the related underlying
assumptions, growth and development opportunities, leasing activities, financing strategies, and development and construction projects.
You should not rely on forward-looking statements since they involve known and unknown risks, uncertainties, assumptions and contingencies,
many of which are beyond the Company’s control that may cause actual results to differ significantly from those expressed
in any forward-looking statement. All forward-looking statements reflect the Company’s good faith beliefs, assumptions and
expectations, but they are not guarantees of future performance. Furthermore, except as otherwise required by federal securities
laws, the Company disclaims any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying
assumptions or factors, new information, data or methods, future events or other changes. For a further discussion of these and
other factors that could cause the Company’s future results to differ materially from any forward-looking statements, see
the risk factors discussed in the Company’s most recent Annual Report on Form 10-K, as updated in the Company’s Quarterly
Reports on Form 10-Q.
Exhibit 99.3
Tuesday , November 4, 2014 Strategic Repositioning
1 Table of Contents Topic Page Improving Capital Allocation & Accountability 2 Concluding Copper Beech 3 - 5 Discontinuing Construction and Development 6 Reducing JV Exposure and Exploring Options for Montreal 7 Reinforcing Investment Discipline 8 Simplifying the Balance Sheet 9 Near Term Next Steps 10
2 Improving Capital Allocation & Accountability • Certain capital allocation decisions have underperformed • Previously unresolved portfolio acquisitions • Disappointing new deliveries • Heavy reliance on joint ventures • Underperforming international redevelopments • We have instituted a strategic shift to: • E nhance ROI through accretive investment decisions • Deliver organic growth by focusing on our operating properties • Restore financial flexibility • R educe our cost of capital • We are taking immediate steps to bring about change • Implementing additional senior management changes • Completing Copper Beech acquisition at attractive terms • Discontinuing construction and development • Reducing joint venture exposure • Reinforcing investment discipline
3 Concluding Copper Beech Summary of Key Terms Acquisition Portfolio of 32 properties 2 representing ~$20M of additional NOI 3 Aggregate Copper Beech Portfolio Ownership 32 properties wholly owned 2 4 properties with CCG as manager holding a 48% economic interest 2 properties reverting to 0% ownership 4 Purchase Price Target Closing December 31, 2014 • ~7.3% cap rate on incremental purchase 1 • OP units to be issued at a premium to current share price and above consensus NAV • Full operational and investment control • Scale, diversification and accretion Footnotes : 1) Represents cap rate of NOI acquired based on incremental consideration and debt assumed; total cumulative cap rate including prior phases of the transaction and the remaining interest in CB Ames is approximately 6.4% 2) Includes 30 operating properties, a leasing office and a land parcel; CCG will own approximately 86% of two of the operating properties due to a remaining third party minority interest 3) Forward NOI contribution based on current leasing and rates 4) Kalamazoo, MI phase I and II 5) Based on share price of $6.34 as of October 31, 2014 A clear resolution at attractive financial terms Cash $60.3 OP Units 5 78.7 Total Consideration 138.9 Incremental Debt Assumed 140.6 Total Purchase Price $279.5
4 Concluding Copper Beech Cap Rate ~$20 million of NOI acquired at a ~7.3% cap rate 1 NOI & FFO Contribution Footnotes : 1) Represents cap rate of NOI acquired based on incremental consideration and debt assumed; total cumulative cap rate including prior phases of the transaction and the remaining interest in CB Ames is approximately 6.4% 2) Pro forma AY14/15 NOI and related expenses based on current in - place occupancy 3) Includes two properties that CCG will own approximately 86% of due to a remaining third party minority interest 4) Analysis conservatively assumes no G&A synergy savings in the first year of operations 5) Based on stock price as of October 31, 2014 of $6.34 ($ in millions) ($ in millions) Current Pro Forma Pro Rata Change Pro Rata NOI Contribution 2 100% Ownership Properties 3 $21 $21 $42 48% Ownership Properties 9 - 9 0% Ownership Properties 1 (1) - Total NOI 30 20 50 Interest Expense (13) (8) (21) General & Administrative 4 (1) (1) (1) FFO Contribution $16 $12 $28 Copper Beech Debt Pro Forma Pro Rata $384 Current Pro Rata ($244) Net Debt Assumed $141 Cash Paid $60 Equity Issued 5 $79 Total Purchase Price $280 Copper Beech NOI 2 Pro Forma Pro Rata $50 Current Pro Rata ($30) Net NOI Acquired $20 Cap Rate 1 7.3%
5 Concluding Copper Beech Pro Forma Capital Structure Footnotes : 1) Cash consideration of Copper Beech transaction 2) Represents consolidation of pro rata share of all Copper Beech debt 3) Equity consideration of Copper Beech transaction As of 9/30/2014 Change Pro Forma Line of Credit & Other $204 $60 1 $265 Exchangable Senior Notes 97 - 97 Wholly Owned Property Debt 265 384 2 649 Total Consolidated Debt $566 445 $1,011 Preferred Equity $153 - $153 Shares Outstanding (mm) 65.20 12.41 3 77.61 Stock Price at October 31, 2014 $6.34 $6.34 Total Market Equity Value $413 $492 Total Market Capitalization $1,132 $1,656 Number of Wholly Owned Operating Properties 36 30 66 Number of Unencumbered Operating Properties 19 9 28 ($ in millions) Significant e quity issuance at a premium to current market price and above consensus NAV
6 Discontinuing Construction and Development • A Focus On Organic Growth • Discontinuation of our construction and development operations • Simplification of our business model • Management focus on operating assets • Rationale • Development activity is economically dilutive at this time • Late deliveries and construction budget overruns • Capital and resource intensive • Benefits • Reduces overhead - 45 positions have been eliminated and additional cost savings are being identified • Simplifies income statement and balance sheet • Eliminates risk associated with development and construction model
7 Reducing JV Exposure & Exploring Options for Montreal Total Managed Revenue by Ownership 1 Wholly Owned JV Current Near - Term Target 2 Footnotes : 1) Projected relative revenue contribution for AY14/15 based on current in - place occupancy and rates 2) Pro forma for the consolidation of Copper Beech and sale of certain JV properties identified for near - term disposition • Working with our largest joint venture partner • Matching their goal to harvest capital with our goal to reduce exposure, delever and increase liquidity • Targeting 4 to 6 assets to sell near - term – and more over time • Eliminated 3 joint venture new deliveries scheduled for 2015 • Reviewing Strategic Alternatives for Montreal • Ongoing efforts to drive occupancy through leasing and resident life initiatives • Focused on our lender relationship and have active dialogue with our investment partners • Identifying capital solutions to reduce exposure 80% 20% 46% 54%
8 Reinforcing Investment Discipline • Improved i nvestment process • Heavy Board of Directors involvement in the creation of investment strategy • Reconstituted formal investment committee to analyze strategy and ensure accountability • Hired CIO to execute investment strategy, coordinate process and oversee all transactions • Focused on capital stewardship • Allocation decisions weigh best course of action to ensure effective capital deployment • Decision analysis looks at all options – debt retirement, asset sales/purchases, capital improvements, return of capital, share repurchases • Establishing a portfolio m anagement framework • Formal review process to evaluate portfolio performance and market exposure • Data - driven approach to analyze transaction cap rates, supply trends, university enrollment dynamics and market fundamentals • Dynamic hold/sell list that reflects operational input, market data, cap - ex analysis and projected return requirements
9 Simplifying the Balance Sheet Copper Beech Transaction Reduced JV Exposure Discontinued Development • $34 million non - cash charge in 3Q14 due to accounting treatment of the Company’s shift in pro - rata economic interest held • Consolidation of Copper Beech upon closing of transaction will provide enhanced transparency of balance sheet and operating results • $28 million impairment of the HSRE joint ventures primarily attributed to: • Impairments to the Company’s investments held in underperforming properties • Write - off of excess basis in properties caused by construction cost overruns • $23 million impairment of the Montreal joint venture to recognize that the Company may not be able to recover the full value of its investment • Exit from development and construction business triggers: • $19 million adjustment to the carrying values of land held for sale 1 • $10 million write - off of unrecoverable pre - development costs • $8 million of other charges and impairments related to G&A reduction and management changes • The Company’s strategic shift triggered significant charges in 3Q14 - resulting in a simplified, more transparent business • Eliminating development pipeline increases transparency and reduces risk exposure • Joint venture reduction will lower total indebtedness and debt guarantees • Assets held for sale provide a source of liquidity Footnote : 1) As of September 30, 2014, Development in Process balance comprises $ 6 million of land held for investment (related to potential Phase 2 developments) and $13 million of assets that are expected to be held for sale in 4Q14
10 Near Term Next Steps 1. Identify assets for disposition • Culling underperforming assets and creating liquidity following a thorough review process 2. Continue to reduce costs • Establish a lean operating model to capture meaningful cost savings in G&A and operations 3. Solidify earnings outlook • Overhaul financial planning and analysis process to provide reliable and credible forecasting 4. Adjust dividend payout • Announce a sustainable dividend policy based upon rigorous analysis of improved forecasts 5. Strengthen our balance sheet • Improve liquidity and reduce debt through asset sales, cost savings and a reduced dividend 6. Focus on operational excellence • Improve occupancy and expand profit margin through organizational and process enhancements 7. Enhance corporate governance • Addition of REIT - experienced independent directors, revamping executive compensation, increasing BoD meeting frequency and other necessary enhancements as determined by the Board and Management
11 Appendix: Copper Beech Portfolio Pro Forma Occupancy Property Primary University Ownership Beds 9/30/14 1)Copper Beech at State College, PA - CB I Penn State University 1996 100% 177 100.0% 2)Copper Beech at State College, PA - CB II Penn State University 1998 100% 257 100.0% 3)Copper Beech at State College, PA - Oakwood Penn State University 2000 100% 144 99.3% 4)Copper Beech at State College, PA - Northbrook Greens Penn State University 2003 86% 250 100.0% 5)Copper Beech at Indiana, PA - IUP I Indiana University of Pennsylvania 1971 100% 239 100.0% 6)Copper Beech at Indiana, PA - IUP II Indiana University of Pennsylvania 1973 100% 172 100.0% 7)Copper Beech at Indiana, PA - IUP Buy Indiana University of Pennsylvania 1975 100% 76 97.3% 8)Copper Beech at Radford, VA Radford University 2005 100% 500 100.0% 9)Copper Beech at West Lafayette, IN – Klondike Purdue University 2003 87% 486 86.6% 10)Copper Beech at West Lafayette, IN – Baywater Purdue University 2004 100% 488 72.3% 11)Copper Beech at Bloomington, IN Indiana University 2005 100% 297 71.0% 12)Copper Beech at Mount Pleasant, MI - Phase I Central Michigan University 2005 100% 632 98.6% 13)Copper Beech at Mount Pleasant, MI - Phase II Central Michigan University 2013 100% 256 100.0% 14)Copper Beech at Fresno, CA California State University at Fresno 2006 100% 506 90.3% 15)Copper Beech at Bowling Green, OH - Phase I Bowling Green University 2005 100% 400 99.8% 16)Copper Beech at Bowling Green, OH - Phase II Bowling Green University 2007 100% 216 100.0% 17)Copper Beech at Allendale, MI - Phase I Grand Valley State University 2006 100% 614 100.0% 18)Copper Beech at Allendale, MI - Phase II Grand Valley State University 2007 100% 290 100.0% 19)Copper Beech at Columbia, MO University of Missouri 2006 100% 654 89.0% 20)Copper Beech at Bloomington, IN - Colonial Crest Indiana University 1970 100% 402 79.4% 21)Copper Beech at Columbia, SC - Phase I University of South Carolina 2007 100% 824 97.3% 22)Copper Beech at Columbia, SC - Phase II University of South Carolina 2008 100% 178 97.8% 23)Copper Beech at San Marcos, TX - Phase I Texas State University 2011 100% 840 89.8% 24)Copper Beech at San Marcos, TX - Phase II Texas State University 2012 100% 410 88.8% 25)Copper Beech at Harrisonburg, VA - Grand Duke James Madison University 2001 100% 124 100.0% 26)Copper Beech at State College, PA - Oak Hill Penn State University 2003 100% 318 100.0% 27)Copper Beech at Statesboro, GA - Phase I Georgia Southern University 2007 100% 754 97.1% 28)Copper Beech at Statesboro, GA - Phase II Georgia Southern University 2013 100% 262 98.5% 29)Copper Beech at Auburn, AL Auburn University 2009 100% 754 92.7% 30)Copper Beech at Ames, IA Iowa State University 2014 100% 660 77.9% 31)Copper Beech at State College, PA - Parkway Plaza Penn State University 1967 48% 633 98.7% 32)Copper Beech at Morgantown, WV West Virginia University 2010 48% 920 99.7% 33)Copper Beech at Harrisonburg, VA James Madison University 2008 48% 1,218 100.0% 34)Copper Beech at Greenville, NC East Carolina University 2008 48% 1,232 95.5% Total - Copper Beech Portfolio 16,183 94.1% Excluded Properties 35)Copper Beech at Kalamazoo, MI - Phase I Western Michigan University 2007 0% 784 82.0% 36)Copper Beech at Kalamazoo, MI - Phase II Western Michigan University 2008 0% 340 69.1% Year Opened/ Acquired
12 Forward Looking Statements This presentation contains certain forward - looking statements that are subject to risks and uncertainties . These forward - looking statements are based on certain assumptions, discuss future expectations, describe future plans and strategies, contain financial and operating projections or state other forward - looking information . The Company’s ability to predict results or the actual effect of future events, actions, plans or strategies is inherently uncertain . Although the Company believes that the expectations reflected in such forward - looking statements are based on reasonable assumptions, the Company’s actual results and performance could differ materially from those set forth in, or implied by, the forward - looking statements . You are cautioned not to place undue reliance on any of these forward - looking statements, which reflect the Company’s views on this date . Furthermore, except as required by law, the Company is under no duty to, and does not intend to, update any of our forward - looking statements after this date, whether as a result of new information, future events or otherwise . This presentation does not constitute, and may not be used in connection with, an offer or solicitation by anyone in any jurisdiction in which such offer or solicitation is not permitted by law or in which the person making the offer or solicitation is not qualified to do so or to any person to whom it is unlawful to make such offer or solicitation .
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