CCG Closes Purchase of JV Properties
Campus Crest Communities, Inc. (NYSE: CCG) (the “Company”) today announced it has closed on the purchase of the remaining 50.1% interest in The Grove at Moscow, Idaho, and the remaining 80.0% interest in The Grove at Valdosta, Georgia, owned by its joint venture partner, Harrison Street Real Estate (“HSRE”). The Company utilized approximately $43.5 million of proceeds from its recent common equity offering to fund the $16.2 million purchase price and retire $27.3 million of mortgage indebtedness secured by the properties.
Based on management's current estimate of the properties' next 12 months net operating income, the acquisitions imply a nominal capitalization rate of approximately 7.2%.
With the completion of this acquisition, the Company has purchased wholly-owned interests in seven properties from HSRE and increased its wholly-owned operating assets from 27 to 29 properties. The Company continues to own interests in four additional operating assets held in joint ventures with HSRE.
The table below provides details on the properties:
|Property||University Served||Year Opened||
|The Grove at Moscow||University of Idaho||2009||0.5||11,043||97.4%|
|The Grove at Valdosta||Valdosta State University||2011||1.9||13,089||98.8%|
“Selective acquisitions of the HSRE joint venture assets continue to be an excellent avenue for our Company to grow its wholly-owned portfolio. These assets, which the Company developed and operates, have demonstrated strong pre-leasing and operational results, and are located at universities we believe have attractive market characteristics,” said Ted W. Rollins, the Company's Co-Chairman and Chief Executive Officer. “We are excited about our progress this year from both an operational and capital perspective. Our preferred offering in February provided funding for our academic year 2012/2013 development pipeline, and our recent common offering provided the flexibility to purchase these assets and reduce our leverage, on a net-debt-to-enterprise-value basis, by over 750 basis points, which we believe is responsible given the macroeconomic backdrop."
About Campus Crest Communities, Inc.
Campus Crest Communities, Inc. is a leading developer, builder, owner and manager of high-quality, purpose-built student housing properties located close to college campuses in targeted U.S. markets. The Company is a self-managed, self-administered and vertically-integrated real estate investment trust which operates all of its properties under The Grove® brand. The Company owns interests in 33 operating student housing properties containing approximately 6,324 apartment units and 17,064 beds. Since its inception, the Company has focused on customer service, privacy, on-site amenities and its proprietary residence life programs to provide college students across the United States with a higher quality of living. Additional information can be found on the Company's website at http://www.campuscrest.com.
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 purposed 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, statements about an implied capitalization rate based on estimated net operating income. 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.
Campus Crest Communities, Inc.
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