CCG Campus Crest Communities, Inc.

 

 

 

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 16, 2015

 

CAMPUS CREST COMMUNITIES, INC.

(Exact Name of Registrant as Specified in Its Charter)

 

Maryland	001-34872	27-2481988
(State or other jurisdiction	(Commission File Number)	(IRS Employer
of incorporation or organization)		Identification No.)
2100 Rexford Road, Suite 414
Charlotte, North Carolina		28211
(Address of Principal Executive Offices)		(Zip Code)

 

Registrant’s telephone number, including area code: (704) 496-2500

 

Not Applicable

(Former name or former address, if changed since last report)

 

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:

 

¨      Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

x      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 16, 2015, Campus Crest Communities, Inc. (the “Company”) made available a copy of the Company’s Third Quarter 2015 Supplemental Analyst Package on its website at www.campuscrest.com. A copy of the Company’s Third Quarter 2015 Supplemental Analyst Package is furnished as Exhibit 99.1 to this current report.

 

The information contained in Item 2.02 of this current report on Form 8-K, including Exhibit 99.1, 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 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 Exhibit 99.1, shall not be deemed to be incorporated by reference in the filings of the registrant under the Securities Act of 1933.

 

Additional Information and Where to Find It

 

This filing may be deemed solicitation material in respect of the proposed acquisition of the Company by HSRE Quad Merger Parent, LLC, a Delaware limited liability company (“Parent”), an affiliate of Harrison Street Real Estate Capital, LLC (“HSRE”). In connection with the proposed merger, the Company has filed with the Securities and Exchange Commission ("SEC") a preliminary proxy statement on November 16, 2015. A full description of the terms of the merger and the merger agreement can be found in the definitive proxy statement that Campus Crest intends to file with the SEC to be used at its annual meeting of shareholders to approve the proposed transaction with HSRE. STOCKHOLDERS ARE ADVISED TO READ CAMPUS CREST'S PRELIMINARY PROXY STATEMENT, AND, WHEN AVAILABLE, CAMPUS CREST’S DEFINITIVE PROXY STATEMENT IN CONNECTION WITH THE SOLICITATION OF PROXIES FOR THE ANNUAL MEETING BECAUSE THESE STATEMENTS WILL CONTAIN IMPORTANT INFORMATION. The definitive proxy statement will be mailed to stockholders as of a record date to be established for voting on the proposed merger. Stockholders will also be able to obtain a copy of the proxy statement, without charge, by directing a request to: Campus Crest, Investor Relations, 2100 Rexford Road, Suite 400, Charlotte, NC 28211, or at its website, www.campuscrest.com. The preliminary proxy statement and definitive proxy statement, once available, can also be obtained, without charge, at the SEC's internet site (http://www.sec.gov).

 

Participants in Solicitation

 

The directors, executive officers and certain other members of management and employees of the Company may be deemed "participants" in the solicitation of proxies from stockholders of the Company in favor of the proposed merger. Information regarding the persons who may, under the rules of the SEC, be considered participants in the solicitation of the stockholders of the Company in connection with the proposed merger will be set forth in the definitive proxy statement and the other relevant documents to be filed with the SEC. You can find information about the Company's executive officers and directors in its Annual Report on Form 10-K for the fiscal year ended December 31, 2014 (the "Form 10-K") as filed with the SEC on April 1, 2015 and Amendment No. 1 to the Form 10-K as filed with the SEC on August 25, 2015 and the Company’s preliminary proxy statement as filed with the SEC on November 16, 2015.

 

Forward-Looking Statements

 

This communication contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. The forward-looking statements, which include statements regarding the proposed merger between the Company and HSRE, may be identified by the inclusion of words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates," "goal" and variations of such words and other similar expressions, and are based on current expectations, estimates, assumptions and projections that are subject to change, and actual results may differ materially from the forward-looking statements. These statements, as they relate to the Company or HSRE, the management of either such company or the proposed merger, involve risks and uncertainties that may cause results to differ materially from those set forth in the statements. The Company intends that such forward-looking statements be subject to the safe-harbor provided by the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the Company's actual results, performance or achievements or industry results to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Many factors, including the following, could cause actual results to differ materially from the forward-looking statements: the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement; the outcome of the legal proceedings that have been, or may be, instituted against the Company and others following announcement of the Company entering into the merger agreement; the inability to complete the proposed merger due to the failure to satisfy the conditions to the merger, including obtaining the approval of the Company's stockholders, lender consents and other closing conditions more fully described in the merger agreement; risks that the proposed merger disrupts current plans and operations of the Company; potential difficulties in employee retention as a result of the proposed merger; the value of any non-transferable contingent value rights which may be issued in connection with the merger; legislative, regulatory and economic developments; risks related to disruption of management's attention from the Company's ongoing business operations due to the proposed merger; the effect of the announcement of the proposed merger on the Company's relationships with colleges and universities, relationships with tenants, operating results and business generally, and other risks and uncertainties described under "Item 1A. Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2014 and in the Company's Quarterly Reports on Form 10-Q for the fiscal quarters ended March 31, 2015, June 30, 2015 and September 30, 2015 and in other documents filed with the SEC by the Company. Given these uncertainties, current and prospective investors should be cautioned in their reliance on such forward-looking statements. Except as required by law, the Company disclaims any obligation to update any such factors or to publicly announce the results of any revision to any of the forward-looking statements contained herein to reflect future events or developments. A more comprehensive discussion of risks, uncertainties, financial reporting restatements, and forward-looking statements may be seen in the Company's Annual Report on Form 10-K and other periodic filings with the SEC.

 

 

Item 8.01        Other Events.

 

The disclosure set forth in Item 2.02 above is incorporated herein by reference in response to this Item 8.01.

 

Item 9.01        Financial Statements and Exhibits.

 

(d) Exhibits.

 

Exhibit No.	Exhibit Description
99.1	Campus Crest Communities, Inc. Third Quarter 2015 Supplemental Analyst Package

 

 

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.
	By: /s/ Scott R. Rochon
	Scott R. Rochon
	Chief Accounting Officer

  

 

 

Dated: November 16, 2015

 

 

Exhibit Index

 

Exhibit Number	Description
99.1	Campus Crest Communities, Inc. Third Quarter 2015 Supplemental Analyst Package

 

 

 

Exhibit 99.1

 

 

Third Quarter 2015

Supplemental Analyst Package

 

	Contact:
	Investor Relations
	704-496-2571
	Investor.Relations@CampusCrest.com

 

 

 

 

THIRD QUARTER 2015

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 - 7
Wholly Owned Grove Property Results of Operations	8
Quarterly Wholly Owned Grove Property Results of Operations	9
Same Store Wholly Owned Property Operating Expenses	10
Copper Beech Property Results of Operations	11
HSRE and Beaumont Joint Venture Property Results of Operations	12
Capital Structure as of September 30, 2015	13
Outstanding Debt and Maturity Schedule	14
Outstanding Debt and Maturity Schedule - Joint Venture	15
Portfolio Overview and Occupancy	16 - 18
Investor Information	19
Forward-Looking Statements	20

 

  

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,
	2015		2014		$ Change		% Change		2015		2014		$ Change		% Change
Total revenues	$44,609		$28,309		$16,300		57.6%		$130,617		$78,010		$52,607		67.4%
NOI	$19,214		$15,515		$3,699		23.8%		$67,634		$43,425		$24,209		55.8%
Net income (loss) attributable to common stockholders 1, 2	($14,692)		($129,974)		$115,282		(88.7%)		($21,002)		($135,414)		$114,412		(84.5%)
Net income (loss) per share - basic3	($0.23)		($2.01)		$1.78		(88.6%)		($0.32)		($2.09)		$1.77		(84.7%)
FFO	($1,841)		($118,125)		$116,284		(98.4%)		$8,307		($95,383)		$103,690		(108.7%)
FFO per share - basic3	($0.03)		($1.82)		$1.79		(98.4%)		$0.13		($1.48)		$1.61		(108.8%)
FFOA	($2,048)		$10,447		($12,495)		(119.6%)		$10,560		$29,000		($18,440)		(63.6%)
FFOA per share - basic3	($0.03)		$0.16		($0.19)		(118.8%)		$0.16		$0.45		($0.29)		(64.4%)
Debt to total market capitalization	63.0%		50.5%		n/a		12.5%		63.0%		50.5%		n/a		12.5%
Operating Statistics
Wholly Owned - Grove
Total RevPOB 4	$506		$530		($24)		(4.4%)		$535		$527		$8		1.6%
Average Physical Occupancy 5	86.8%		88.1%		n/a		(1.3%)		87.7%		88.5%		n/a		(0.8%)
Wholly Owned - Copper Beech
Total RevPOB 4	$525		$501		$24		4.9%		$501		$492		$9		1.8%
Average Physical Occupancy 5	88.3%		90.9%		n/a		(2.6%)		91.2%		89.5%		n/a		1.7%

 

¹For the three and nine months ended September 30, 2015 and 2014, results include certain equity in earnings (losses) in unconsolidated entities, severance, transaction costs and write offs of other corporate assets.

²For the three months ended September 30, 2015 and 2014, 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 enabled the Company to acquire a 67% ownership interest in 28 operating properties, while deferring ownership in 7 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% ownership interest in 35 operating properties. On January 30, 2015, the Company completed the initial closing of the Copper Beech transaction. As of September 30, 2015, the Company held a 100% interest in 29 Copper Beech properties and partial interest in 5 Copper Beech properties.

³For the period ended September 30, 2015, shares issuable upon settlement of the exchange feature of the Exchangeable Senior notes were anti-dilutive and were not included in the computation of earnings per share.

⁴Total revenue per occupied bed includes rental and service revenues.

⁵Average monthly occupancy.

 

  

CAMPUS CREST COMMUNITIES

CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)

(in $000s)

 

		September 30,		December 31,
		2015		2014
Assets
Investment in real estate, net:
Student housing properties1		$1,581,512		$935,962
Accumulated depreciation		(163,748)		(128,121)
Land and properties held for sale2		15,019		37,163
Land held for investment3		7,413		7,413
Investment in real estate, net		1,440,196		852,417
Investment in unconsolidated entities1		81,852		259,740
Cash and cash equivalents		16,166		15,240
Restricted cash3		11,434		5,429
Student receivables, net		3,606		1,587
Cost and earnings in excess of construction billings		-		3,887
Intangible assets, net		4,691		-
Other assets		25,635		35,742
Total assets		$1,583,580		$1,174,042
Liabilities and equity
Liabilities:
Mortgage and construction loans		$602,223		$300,673
Line of credit and other debt		369,714		317,746
Accounts payable and accrued expenses		35,567		53,816
Construction billings in excess of cost and earnings		-		481
Other liabilities		32,370		22,092
Total liabilities		1,039,874		694,808
Equity:
Preferred stock		$61		$61
Common stock		648		648
Additional common and preferred paid-in capital		781,540		773,998
Accumulated deficit and distributions		(313,418)		(301,566)
Accumulated other comprehensive loss		(3,695)		(2,616)
Total stockholders' equity		465,136		470,525
Noncontrolling interests		78,570		8,709
Total equity		543,706		479,234
Total liabilities and equity		$1,583,580		$1,174,042

 

¹ As of September 30, 2015, the Company's 100% interest in 29 Copper Beech properties (and Copper Beech at Ames), pursuant to the closing of the Copper Beech transaction, is included in "Student housing properties." In prior periods, the Company's investment in these properties was included in "Investment in unconsolidated entities."

² As of September 30, 2015, includes four land parcels and one property that the Company intends to divest.

³ As of September 30, 2015, includes six strategically held land parcels that could be used for the development of phase two properties, with an aggregate bed count ranging from approximately 1,000 to 1,500.

⁴ Restricted cash includes escrow accounts held by lenders for the purpose of paying taxes, insurance and funding capital improvements.

 

  

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,
		2015		2014		$ Change		2015		2014		$ Change
Revenues:
Student housing rental		$42,254		26,985		$15,269		124,766		74,256		$50,510
Student housing services		2,196		1,043		1,153		5,251		3,043		2,208
Property management services		159		281		(122)		600		711		(111)
Total revenues		44,609		28,309		16,300		130,617		78,010		52,607
Operating expenses:
Student housing operations		25,236		12,513		12,723		62,383		33,874		28,509
General and administrative		8,404		3,178		5,226		26,865		10,332		16,533
Severance1		-		720		(720)		570		720		(150)
Write-off of predevelopment costs		-		29,790		(29,790)		-		29,790		(29,790)
Write-off of other assets		796		7,765		(6,969)		2,162		7,765		(5,603)
Transaction costs2		758		286		472		3,890		2,331		1,559
Ground leases		121		120		1		361		357		4
Depreciation and amortization		18,913		7,036		11,877		66,530		21,270		45,260
Total operating expenses		54,228		61,408		(7,180)		162,761		106,439		56,322
Equity in earnings (loss) of unconsolidated entities3,4		(973)		635		(1,608)		(2,332)		63		(2,395)
Impairment of unconsolidated entities		-		(50,866)		50,866		-		(50,866)		50,866
Effect of not exercising Copper Beech purchase option		-		(34,047)		34,047		-		(34,047)		34,047
Operating income (loss)		(10,592)		(117,377)		106,785		(34,476)		(113,279)		78,803
Nonoperating income (expense):
Interest expense, net		(9,239)		(3,639)		(5,601)		(26,297)		(9,965)		(16,332)
Gain on purchase of Copper Beech5		(1,242)		-		(1,242)		26,793		-		26,793
Gain on purchase of unconsolidated entity6		6,370		-		6,370		6,370		-		6,370
Gain on sale of assets7		1,400		-		1,400		9,148		-		9,148
Other income (expense)		(626)		(41)		(585)		(677)		129		(806)
Total nonoperating expense, net		(3,337)		(3,680)		342		15,337		(9,836)		25,173
Net income (loss) before income tax benefit (expense)		(13,929)		(121,057)		107,128		(19,139)		(123,115)		103,976
Income tax benefit (expense)		(164)		(1,131)		967		(164)		(731)		567
Income (loss) from continuing operations		(14,093)		(122,188)		108,095		(19,303)		(123,846)		104,543
Income (loss) from discontinued operations8		-		(5,506)		5,506		(1,157)		(3,191)		2,034
Net income (loss)		(14,093)		(127,694)		113,601		(20,460)		(127,037)		106,577
Less: Dividends on preferred stock		3,050		3,050		-		9,150		9,150		-
Less: Net income or (loss) attributable to noncontrolling interests		(2,451)		(770)		(1,681)		(8,608)		(773)		(7,835)
Net income (loss) attributable to common stockholders		($14,692)		($129,974)		$115,282		($21,002)		($135,414)		$114,412
Per share data - basic
Income (loss) from continuing operations attributable to common stockholders		($0.23)		($1.92)				($0.30)		($2.04)
Income (loss) from discontinued operations attributable to common stockholders		-		($0.09)				($0.02)		($0.05)
Net income (loss) per share attributable to common stockholders		($0.23)		($2.01)				($0.32)		($2.09)
Weighted average common shares outstanding:
Basic and diluted		64,762		64,770				64,746		64,650

 

¹For the nine months ended September 30, 2015, severance includes termination benefits for former executives in connection with the Company's strategic repositioning.

²Transaction costs were $0.8 million for the three months ended September 30, 2015, primarily attributable to costs associated with our strategic alternative process of $0.4 million and various other costs aggregating to $0.4 million. Transaction costs were $3.9 million for the nine months ended September 30, 2015, primarily attributable to consents, professional fees and other related costs totaling $2.9 million related to the Copper Beech acquisition, $0.4 million associated with our strategic alternative process, and $0.6 million related to various other costs.

³For the nine months ended September 30, 2015 and 2014, 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 enabled the Company to acquire a 67% ownership interest in 28 operating properties, while deferring ownership in 7 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. On January 30, 2015, the Company completed the initial closing of the Copper Beech transaction. As of September 30, 2015, the Company held a 100% interest in 29 Copper Beech properties and partial interest in 5 Copper Beech properties.

⁴For the three months and nine months ended September 30, 2015, $1.3 million and $2.3 million equity in losses of unconsolidated entities were contributed from the Montreal operations, respectively.

⁵For the three months ended September 30, 2015, the gain on Copper Beech was reduced by $1.2 million which related to a settlement with CB Investors of all outstanding items. This brings the total gain through the nine months ended September 30, 2015 to $26.8 million.

⁶During the three months ended September 30, 2015, the Company acquired its remaining interest in The Grove at Fayetteville, Arkansas. In connection with that purchase, a $6.4 million gain was recognized.

⁷In connection with the previously announced strategic repositioning the Company recognized a $3.1 million gain from the sale of a portfolio of six undeveloped land parcels in 1Q 2015. The Company also recognized a $4.6 million gain from the sale of The Grove at Lawrence, Kansas and The Grove at Conway, Arkansas in 1Q 2015. In 3Q 2015, the Company recognized a $1.4 million gain from the sale of The Grove at Laramie, Wyoming, The Grove at Norman, Oklahoma and the Grove at San Angelo, Texas.

⁸No construction and development revenues were recorded during the three months ended September 30, 2015. For the nine months ended September 30, 2015, the Company recorded expenses of $1.2 million due to the wind down of its construction and development operations. For the three months ended September 30, 2014, the Company recorded $5.6 million of revenues and $11.1 million of expenses for a loss of $5.5 million. For the nine months ended September 30, 2014, the Company recorded revenue from its construction and development operations of $23.2 million and expenses of $26.4 million resulting in loss of $3.2 million.

 

 

CAMPUS CREST COMMUNITIES
RECONCILIATION OF NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS TO FUNDS FROM OPERATIONS ("FFO") & FUNDS FROM OPERATIONS ADJUSTED ("FFOA") (unaudited)
(in $000s, except per share data)
		Three Months Ended September 30,						Nine Months Ended September 30,
		2015		2014		$ Change		2015		2014		$ Change
Net loss attributable to common stockholders		($14,692)		($129,974)		$115,282		($21,002)		($135,414)		$114,412
Real estate related depreciation and amortization		18,359		6,590		11,769		64,555		20,175		44,380
Real estate related depreciation and amortization - unconsolidated entities		1,020		5,259		(4,239)		7,065		19,856		(12,791)
Gain on sale of assets1		(1,400)		-		(1,400)		(9,148)		-		(9,148)
Gain on purchase of unconsolidated entity2		(6,370)		-		(6,370)		(6,370)		-		(6,370)
Loss (gain) on purchase of Copper Beech3		1,242		-		1,242		(26,793)		-		(26,793)
FFO available to common shares		(1,841)		(118,125)		116,284		8,307		(95,383)		103,690
Elimination of the following:
Transaction costs4		758		286		472		3,890		2,331		1,559
Impairment of land and predevelopment costs		-		29,790		(29,790)		-		29,790		(29,790)
Impairment of unconsolidated entities		-		50,866		(50,866)		-		50,866		(50,866)
Write-off of other assets		796		7,765		(6,969)		2,162		7,765		(5,603)
Severance		-		720		(720)		570		720		(150)
Income tax expense		164		1,131		(967)		164		731		(567)
Discontinued operations5		-		5,506		(5,506)		1,157		3,191		(2,034)
Effect of not exercising Copper Beech purchase option		-		34,047		(34,047)		-		34,047		(34,047)
FV adjustment of CB debt6		(1,925)		(1,539)		(386)		(5,690)		(5,058)		(632)
Funds from operations adjusted (FFOA) available to common shares		($2,048)		$10,447		($12,495)		$10,560		$29,000		($18,440)
FFO per share - basic		($0.03)		($1.82)		$1.79		$0.13		($1.48)		$1.61
FFOA per share - basic		($0.03)		$0.16		($0.19)		$0.16		$0.45		($0.29)
Weighted average common shares - basic		64,762		64,770				64,746		64,650

 

¹In connection with the previously announced strategic repositioning the Company recognized a $3.1 million gain from the sale of a portfolio of six undeveloped land parcels in 1Q 2015. The Company also recognized a $4.6 million gain from the sale of The Grove at Lawrence, Kansas and The Grove at Conway, Arkansas in 1Q 2015. In 3Q 2015, the Company recognized a $1.4 million gain from the sale of The Grove at Laramie, Wyoming, The Grove at Norman, Oklahoma and the Grove at San Angelo, Texas.

²During the three months ended September 30, 2015, the Company acquired its remaining interest in The Grove at Fayetteville, Arkansas. In connection with that purchase, a $6.4 million gain was recognized.

³During the quarter ended September 30, 2015, the Company reached agreement with the CB Investors on all outstanding matters which resulted in a reduction of the gain on the purchase of Copper Beech of $1.2 million.

⁴Transaction costs were $0.8 million for the three months ended September 30, 2015, primarily attributable to costs associated with our strategic alternative process of $0.4 million and various other costs aggregating to $0.4 million.Transaction costs were $3.9 million for the nine months ended September 30, 2015, primarily attributable to consents, professional fees and other related costs totaling $2.9 million related to the Copper Beech acquisition, $0.4 million associated with our strategic alternative process, and $0.6 million related to various other costs.

⁵No construction and development revenues were recorded during the three months ended September 30, 2015. For the nine months ended September 30, 2015, the Company recorded expenses of $1.2 million due to the wind down of its construction and development operations. For the three months ended September 30, 2014, the Company recorded $5.6 million of revenues and $11.1 million of expenses for a loss of $5.5 million. For the nine months ended September 30, 2014, the Company recorded revenue from its construction and development operations of $23.2 million and expenses of $26.4 million resulting in loss of $3.2 million.

⁶Includes the Company's proportionate share of non-cash fair value debt and other purchase accounting adjustments in its investment in Copper Beech accounted for under the equity method, as well as the fair value of debt adjustments for those Copper Beech properties consolidated during the nine months ended September 30, 2015.

 

 

CAMPUS CREST COMMUNITIES
RECONCILIATION OF NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS TO NET OPERATING INCOME ("NOI") (unaudited)
(in $000s, except per share data)

		Three Months Ended September 30,				Nine Months Ended September 30,
		20151		20141		20151		20141
Net income (loss) attributable to common stockholders		($14,692)		($129,974)		($21,002)		($135,414)
Net loss attributable to noncontrolling interests		(2,451)		(770)		(8,608)		(773)
Preferred stock dividends		3,050		3,050		9,150		9,150
Income tax expense		164		1,131		164		731
Other (income) expense		626		41		677		(129)
Gain on sale of assets		(1,400)		-		(9,148)		-
Gain of purchase of unconsolidated entity		(6,370)		-		(6,370)		-
Severance		-		720		570		720
(Gain) loss on purchase of Copper Beech		1,242		-		(26,793)		-
(Income) loss on discontinued operations		-		5,506		1,157		3,191
Interest expense		9,239		3,639		26,297		9,965
Equity in losses of unconsolidated entities		973		(635)		2,332		(63)
Depreciation and amortization		18,913		7,036		66,530		21,270
Impairment of investment in unconsolidated joint venture		-		-		-		-
Ground lease expense		121		120		361		357
General and administrative expense		8,404		3,178		26,865		10,332
Impairment of unconsolidated entities		-		50,866		-		50,866
Effect of not exercising Copper Beech purchase option		-		34,047		-		34,047
Impairment of land, predevelopment costs and asset held for sale		-		29,790		-		29,790
Write-off of corporate other assets		796		7,765		2,162		7,765
Transaction costs		758		286		3,890		2,331
Property management services		(159)		(281)		(600)		(711)
Total NOI		$19,214		$15,515		$67,634		$43,425
Grove same store properties NOI2		$8,688		$12,232		$35,786		$37,709
Wholly owned Copper Beech properties NOI		$7,941		$ -		$22,427		$ -
New properties NOI3,4		$1,903		$2,407		$7,249		$3,349
Grove Pullman and Toledo NOI5		$682		$876		$2,172		$2,367

 

¹ "Same store" properties are the Company's wholly-owned operating properties acquired or placed in-service prior to the beginning of the earliest period presented and owned by the Company and remaining in service through the end of the latest period presented or period being analyzed. "New properties" are the Company's wholly-owned operating properties acquired or placed in service after the beginning of the earliest period presented or period being analyzed.

² Includes NOI contribution from Copper Beech at Ames. This is a consolidated wholly-owned property.

³ For the three and nine months ended September 30, 2015 and 2014, includes financial results for The Grove at Denton. The Company acquired its joint venture partner's interest in The Grove at Denton on January 21, 2014. The occupancy data and net operating income related to Denton are included in new properties in the subsequent pages. Net operating income earned after acquisition is reported above, while amounts earned prior to acquisition were reported under the equity method of accounting.

⁴ For the three and nine months ended September 30, 2015, includes financial results for The Grove at Fayetteville. The Company acquired its joint venture partner's interest in The Grove at Fayetteville on August 7, 2015. The occupancy data and net operating income related to Fayetteville are included in new properties in the subsequent pages. Net operating income earned after acquisition is reported above, while amounts earned prior to acquisition were reported under the equity method of accounting.

⁵ 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 GROVE PROPERTY RESULTS OF OPERATIONS (unaudited)
(in $000s, except bed data)
				Three Months Ended September 30,								Nine Months Ended September 30,
				2015		2014		Change		% Change		2015		2014		Change		% Change
Same store properties (Number of properties)1, 2				30		30						30		30
Revenue per occupied bed
Rental revenue per occupied bed per month3				$489		$505		($16)		(3.2%)		$513		$503		$10		2.1%
Services revenue per occupied bed per month				19		21		(2)		(11.9%)		19		21		(2)		(9.9%)
Total revenue per occupied bed				$508		$526		($18)		(3.4%)		$532		$524		$8		1.6%
Average number of owned beds				16,308		16,308						16,308		16,308
Average physical occupancy				87.3%		90.1%				(2.8%)		89.1%		89.9%				(0.9%)
Total revenue				$21,763		$23,172		($1,409)		(6.1%)		$69,709		$69,162		$547		0.8%
Property operating expenses				13,075		10,940		2,135		19.5%		33,923		31,453		2,470		7.9%
Net operating income				$8,688		$12,232		($3,544)		(29.0%)		$35,786		$37,709		($1,923)		(5.1%)
Operating margin4				39.9%		52.8%				(12.9%)		51.3%		54.5%				(3.2%)
New properties (Number of properties)5, 6				7		7		0				7		7		0
Revenue per occupied bed
Rental revenue per occupied bed per month3				$481		$535		($54)		(10.1%)		$533		$533		$0		0.0%
Services revenue per occupied bed per month				18		18		(0)		(0.2%)		16		18		(2)		(11.1%)
Total revenue per occupied bed				$499		$553		($54)		(9.8%)		$549		$551		($2)		(0.4%)
Average number of owned beds				4,321		3,286						4,321		1,906
Average physical occupancy				85.1%		78.2%				6.9%		82.5%		75.9%				6.5%
Total revenue				$5,505		$4,264		$1,241		29.1%		$17,612		$7,127		$10,485		147.1%
Property operating expenses				3,474		1,679		1,795		106.9%		9,651		3,275		6,376		194.7%
Net operating income				$2,032		$2,584		($552)		(21.3%)		$7,961		$3,852		$4,109		106.7%
Operating margin4				36.9%		60.6%				(23.7%)		45.2%		54.0%				(8.8%)
ALL PROPERTIES (Number of properties)				37		37		0				37		37		0
Revenue per occupied bed
Rental revenue per occupied bed per month3				$487		$509		($22)		(4.4%)		$517		$506		$11		2.2%
Services revenue per occupied bed per month				19		20		(1)		(6.5%)		18		21		(3)		(14.3%)
Total revenue per occupied bed				$506		$530		($24)		(4.5%)		$535		$527		$8		1.5%
Average number of owned beds				20,629		19,594						20,629		18,214
Average physical occupancy				86.8%		88.1%				(1.3%)		87.7%		88.5%				(0.8%)
Total revenue				$27,269		$27,436		($167)		(0.6%)		$87,320		$76,289		$11,031		14.5%
Property operating expenses				16,549		12,619		3,930		31.1%		43,574		34,727		8,847		25.5%
Net operating income				$10,720		$14,817		($4,097)		(27.7%)		$43,746		$41,562		$2,184		5.3%
Operating margin4				39.3%		54.0%				(14.7%)		50.1%		54.5%				(4.4%)
The Grove at Pullman & Toledo NOI7				$682		$876		($194)		(22.1%)		$2,172		$2,367		($195)		(8.2%)

 

¹Excludes financial results from The Grove at Pullman. On July 14, 2013, the Company experienced a fire at this property during development. As of September 30, 2015, 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.

²Excludes financial results from the Toledo, OH redevelopment property the Company acquired on March 15, 2013.

³Beginning with the ‘14/’15 academic year, the Company recognizes revenue for new leases over the term of the lease (typically 11.5 months) rather than in conjunction with the lease payments (typically 12 equal monthly payments). While this policy change will have no cash impact, and will have minimal year-over-year impact on a go-forward basis, the adjustment has the effect of lower reported revenue in three and nine months ended September 30, 2015, as compared to prior year.

⁴Operating margin is calculated by dividing NOI for the period by total student housing rental and services revenues for the period.

⁵For the three and nine months ended September 30, 2015 and 2014, includes financial results for The Grove at Denton and The Grove at Fayetteville. The Company acquired its joint venture partner's interest in The Grove at Denton on January 21, 2014 and the interest in The Grove at Fayetteville on August 7, 2015. The occupancy data and net operating income related to Denton and Fayetteville are included in new properties. Note that the portion of earnings prior to the properties becoming wholly owned were captured in the Equity in Earnings line in the comprehensive statements of income (loss). For comparability, full period results have been shown herein and therefore will not agree to Page 7.

⁶For the three and nine months ended September 30, 2015, includes financial results for the 2014 wholly-owned and consolidated deliveries (The Grove at Gainesville, The Grove at Grand Forks, The Grove at Slippery Rock, The Grove at Mt. Pleasant and Copper Beech at Ames).

⁷Includes NOI contribution from the operations of The Grove at Pullman and the Toledo, OH redevelopment property.

 

 

CAMPUS CREST COMMUNITIES

QUARTERLY WHOLLY OWNED GROVE PROPERTY RESULTS OF OPERATIONS (unaudited)

(in $000s, except bed data)

				Three Months Ended
				September 30, 2014		December 31, 2014		March 31, 2015		June 30, 2015		September 30, 2015
Same store properties (Number of properties)1, 2				30		30		30		30		30
Revenue per occupied bed
Rental revenue per occupied bed per month3				$505		$512		$525		$529		$489
Services revenue per occupied bed per month				21		15		17		20		19
Total revenue per occupied bed				$526		$527		$542		$549		$508
Average number of owned beds				16,308		16,308		16,308		16,308		16,308
Average physical occupancy				90.1%		91.6%		90.7%		89.2%		87.3%
Total revenue				$23,172		$24,120		$24,075		$23,871		$21,763
Property operating expenses				10,940		10,388		10,473		10,375		13,075
Net operating income				$12,232		$13,732		$13,602		$13,496		$8,688
Operating margin4				52.8%		56.9%		56.5%		56.5%		39.9%
New properties (Number of properties)5, 6, 7				7		7		7		7		7
Revenue per occupied bed
Rental revenue per occupied bed per month3				$535		$531		$558		$563		$481
Services revenue per occupied bed per month				18		11		14		16		18
Total revenue per occupied bed				$553		$541		$572		$579		$499
Average number of owned beds				3,286		4,321		4,321		4,321		4,321
Average physical occupancy				78.2%		80.5%		80.9%		81.4%		85.1%
Total revenue				$4,264		$5,649		$6,001		$6,106		$5,505
Property operating expenses				1,679		2,426		3,058		3,120		3,474
Net operating income				$2,584		$3,223		$2,943		$2,987		$2,032
Operating margin4				60.6%		57.1%		49.0%		48.9%		36.9%
ALL PROPERTIES (Number of properties)				37		37		37		37		37
Revenue per occupied bed
Rental revenue per occupied bed per month3				$509		$516		$532		$535		$487
Services revenue per occupied bed per month				20		14		16		19		19
Total revenue per occupied bed				$530		$529		$548		$555		$506
Average number of owned beds				19,594		20,629		20,629		20,629		20,629
Average physical occupancy				88.1%		89.2%		88.7%		87.6%		86.8%
Total revenue				$27,436		$29,770		$30,076		$29,977		$27,269
Property operating expenses				12,619		12,814		13,531		13,494		16,549
Net operating income				$14,817		$16,955		$16,545		$16,483		$10,720
Operating margin4				54.0%		57.0%		55.0%		55.0%		39.3%
The Grove at Pullman & Toledo NOI8				$876		$910		$721		$769		$682

 

¹Excludes financial results from The Grove at Pullman. On July 14, 2013, the Company experienced a fire at this property during development. As of September 2015, 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.

²Excludes financial results from the Toledo, OH redevelopment property the Company acquired on March 15, 2013.

³Beginning with the ‘14/’15 academic year, the Company recognizes revenue for new leases over the term of the lease (typically 11.5 months) rather than in conjunction with the lease payments (typically 12 equal monthly payments). While this policy change will have no cash impact, and will have minimal year-over-year impact on a go-forward basis, the adjustment has the effect of lower reported revenue in the three ended September 30, 2015, as compared to prior year. 

⁴Operating margin is calculated by dividing NOI for the period by total student housing rental and services revenues for the period.

⁵For all periods, includes financial results for the 2014 wholly-owned deliveries (The Grove at Gainesville, The Grove at Grand Forks, The Grove at Slippery Rock, The Grove at Mt. Pleasant and Copper Beech at Ames).

⁶For all periods, includes financial results for The Grove at Denton. The Company acquired its joint venture partner's interest in the Grove at Denton on January 21, 2014.

⁷For all periods, includes financial results for The Grove at Fayetteville. The Company acquired its joint venture partner's interest in the Grove at Fayetteville on August 7, 2015.

⁸Includes NOI contribution from the operations of The Grove at Pullman and the Toledo, OH redevelopment property.

 

 

CAMPUS CREST COMMUNITIES
SAME STORE WHOLLY OWNED GROVE PROPERTY OPERATING EXPENSES (unaudited)
(in $000s, except bed data)
		Three Months Ended September 30, 2015							Three Months Ended September 30, 2014						Y-o-Y Total Change
		Total		% of Total		Per Bed/Month			Total		% of Total		Per Bed/Month		$		%
Payroll		$2,824		21.6%		$58			$2,401		21.9%		$49		$423		17.6%
Marketing		501		3.8%		10			375		3.4%		8		127		33.8%
Office, Administration & Other		811		6.2%		17			643		5.9%		13		168		26.1%
Bad Debt		464		3.5%		9			1,378		12.6%		28		(914)		(66.3%)
Utilities		3,610		27.6%		74			3,120		28.5%		64		490		15.7%
Repairs and Maintenance1		2,463		18.8%		50			795		7.3%		16		1,668		209.7%
Taxes and Insurance		2,401		18.4%		49			2,228		20.4%		46		174		7.8%
Total		$13,075		100.0%		$267			$10,940		100.0%		$224		$2,135		19.5%
Same Store
Wholly Owned Beds		16,308							16,308
Wholly Owned Properties		30							30
		Nine Months Ended September 30, 2015							Nine Months Ended September 30, 2014						Y-o-Y Total Change
		Total		% of Total		Per Bed/Month			Total		% of Total		Per Bed/Month		$		%
Payroll		$7,762		22.9%		$53			$7,005		22.2%		$48		$757		10.8%
Marketing		1,101		3.2%		7			949		3.0%		6		152		16.0%
Office, Administration & Other		2,102		6.2%		14			1,884		6.0%		13		218		11.6%
Bad Debt		1,497		4.4%		10			2,125		6.8%		14		(628)		(29.6%)
Utilities		10,303		30.4%		70			9,913		31.5%		68		390		3.9%
Repairs and Maintenance1		3,911		11.5%		27			2,759		8.8%		19		1,152		41.8%
Taxes and Insurance		7,247		21.4%		49			6,849		21.8%		47		398		5.8%
Total		$33,923		100.0%		$231			$31,484		100.0%		$215		$2,439		7.7%
Same Store
Wholly Owned Beds		16,308							16,308
Wholly Owned Properties		30							30

 

¹During the '14/'15 academic year, the Company changed its accounting policy in connection with turn expenses to recognize costs in the period in which they are incurred as compared to its previous policy of accounting for the costs of turn ratably over the twelve month academic year. As a result, on a going forward basis, expenses related to turn will be predominantly recognized during the third quarter of the year.

 

 

CAMPUS CREST COMMUNITIES
COPPER BEECH PROPERTY RESULTS OF OPERATIONS (unaudited)
(in $000s, except bed data)
	Three Months Ended September 30,								Nine Months Ended September 30,
	2015		2014		Change		% Change		2015		2014		Change		% Change
Wholly owned same store properties (Number of properties)1, 2	29		29		-				29		29		-
Revenue per occupied bed
Rental revenue per occupied bed per month	$477		$456		$21		4.7%		$461		$456		$5		1.1%
Services revenue per occupied bed per month	48		45		3		7.1%		40		36		4		10.2%
Total revenue per occupied bed	$525		$501		$24		4.9%		$501		$492		$9		1.8%
Average number of owned beds	11,520		11,520						11,520		11,520
Average physical occupancy	88.3%		90.9%				(2.6%)		91.2%		89.5%				1.7%
Total revenue	$16,051		$15,745		$306		1.9%		$47,377		$45,657		$1,719		3.8%
Property operating expenses	8,110		6,144		1,965		32.0%		20,261		17,501		2,760		15.8%
Net operating income3	$7,941		$9,601		($1,659)		(17.3%)		$27,116		$28,157		($1,041)		(3.7%)
Operating margin4	49.5%		61.0%				(11.5%)		57.2%		61.7%				(4.5%)
Joint venture same store properties (Number of properties)5	5		5		-				5		5		-
Revenue per occupied bed
Rental revenue per occupied bed per month	$521		$496		$25		5.1%		$505		$491		$14		2.8%
Services revenue per occupied bed per month	54		48		6		12.2%		41		39		2		4.9%
Total revenue per occupied bed	$575		$544		$31		5.8%		$546		$530		$15		2.9%
Average number of owned beds	4,343		4,343						4,343		4,343
Average physical occupancy	92.9%		94.9%				(2.0%)		94.4%		95.0%				(0.6%)
Total revenue	$6,969		$6,729		$241		3.6%		$20,136		$19,692		$444		2.3%
Property operating expenses	2,703		2,345		358		15.3%		6,891		6,744		147		2.2%
Net operating income	$4,267		$4,383		($117)		(2.7%)		$13,244		$12,948		$297		2.3%
Operating margin4	61.2%		65.1%				(3.9%)		65.8%		65.8%				0.0%
ALL PROPERTIES (Number of properties)	34		34		-				34		34		-
Revenue per occupied bed
Rental revenue per occupied bed per month3	$490		$467		$23		4.8%		$473		$466		$7		1.6%
Services revenue per occupied bed per month	50		46		4		8.7%		40		37		3		8.6%
Total revenue per occupied bed	$540		$513		$27		5.2%		$513		$503		$11		2.1%
Average number of owned beds	15,863		15,863						15,863		15,863
Average physical occupancy	89.6%		92.0%				(2.4%)		92.1%		91.0%				1.1%
Total revenue	$23,020		$22,474		$546		2.4%		$67,512		$65,349		$2,163		3.3%
Property operating expenses	10,813		8,489		2,323		27.4%		27,152		24,245		2,907		12.0%
Net operating income	$12,207		$13,985		($1,777)		(12.7%)		$40,360		$41,104		($744)		(1.8%)
Operating margin4	53.0%		62.2%				(9.2%)		59.8%		62.9%				(3.1%)

 

¹On January 30, 2015, the Company completed the initial closing of the Copper Beech transaction and acquired the sellers' remaining interest in 25 student housing properties of a portfolio consisting of 36 student housing properties. During Q2 2015, the Company acquired the seller's' remaining interest in 4 additional properties. Remaining interest in Copper Beech at Ames was also acquired pursuant to the second amendment and has been included in the wholly owned Grove results of operations as it was historically a consolidated property.

²Excludes financial results from Copper Beech at Kalamazoo- Phase I. Pursuant to the initial closing of the Copper Beech transaction on January 30, 2015, the Company had no ownership interest in the property as of September 30, 2015.

³For the nine months ended September 30, 2015, $22,427 and $4,689 were recorded as consolidated net operating income and investment in unconsolidated entities, respectively.

⁴Operating margin is calculated by dividing NOI for the period by total student housing rental and services revenues for the period.

⁵Includes financial results for Copper Beech at Morgantown, Copper Beech at Harrisonburg, Copper Beech at State College - Parkway Plaza, Copper Beech at Greenville and Copper Beech at Kalamazoo - Phase II.

 

 

CAMPUS CREST COMMUNITIES
HSRE AND BEAUMONT JOINT VENTURE AND OTHER PROPERTY RESULTS OF OPERATIONS (unaudited)
(in $000s, except per bed data)
	Three Months Ended September 30,								Nine Months Ended September 30,
	2015		2014		Change		% Change		2015		2014		Change		% Change
HSRE AND BEAUMONT
Same store properties (Number of properties)1	2		2		-				2		2		-
Revenue per occupied bed
Rental revenue per occupied bed per month2	$542		$597		($55)		(9.2%)		$594		$587		$7		1.1%
Services revenue per occupied bed per month	23		21		2		10.4%		21		19		2		10.4%
Total revenue per occupied bed	$565		$618		($53)		(8.5%)		$615		$607		$7		1.2%
Average number of owned beds	1,184		1,184						1,184		1,184
Average physical occupancy	83.7%		82.2%				1.5%		81.8%		79.9%				1.9%
Total revenue	$1,680		$1,804		($124)		(6.9%)		$5,357		$5,161		$196		3.8%
Property operating expenses	864		754		109		14.5%		2,673		2,560		113		4.4%
Net operating income	$816		$1,050		($233)		(22.2%)		$2,684		$2,602		$82		3.2%
Operating margin3	48.6%		58.2%				(9.6%)		50.1%		50.4%				(0.3%)
NEW PROPERTIES (Number of properties)4	5		5		0				5		5		0
Revenue per occupied bed
Rental revenue per occupied bed per month2	$776		$756		$20		2.6%		$839		$756		$83		10.9%
Services revenue per occupied bed per month	85		23		62		272.1%		105		23		82		356.4%
Total revenue per occupied bed	$861		$779		$82		10.5%		$944		$779		$164		21.1%
Average number of owned beds	4,277		2,134						4,277		711
Average physical occupancy	51.0%		36.0%				15.0%		40.9%		36.0%				4.9%
Total revenue	$5,632		$1,796		$3,836		213.6%		$14,851		$1,796		$13,055		726.9%
Property operating expenses	3,610		850		2,760		324.7%		13,951		850		13,101		1541.2%
Net operating income	$2,022		$946		$1,076		113.8%		$899		$946		($47)		(4.9%)
Operating margin3	35.9%		52.7%				(16.8%)		6.1%		52.7%				(46.6%)
ALL PROPERTIES (Number of properties)1,4	7		7		0				7		7		0
Revenue per occupied bed
Rental revenue per occupied bed per month2	$703		$667		$36		5.3%		$752		$623		$128		20.6%
Services revenue per occupied bed per month	66		22		44		202.0%		75		20		55		277.6%
Total revenue per occupied bed	$769		$689		$80		11.6%		$826		$643		$183		28.5%
Average number of owned beds	5,461		3,318						5,461		1,895
Average physical occupancy	58.1%		52.5%				5.6%		49.7%		63.4%				(13.7%)
Total revenue	$7,312		$3,600		$3,712		103.1%		$20,208		$6,957		$13,250		190.5%
Property operating expenses	4,474		1,604		2,869		178.8%		16,624		3,410		13,215		387.6%
Net operating income	$2,839		$1,996		$843		42.2%		$3,583		$3,548		$36		1.0%
Operating margin3	38.8%		55.4%				(16.6%)		17.7%		51.0%				(33.3%)
Preferred investments5, 6	$7,323		$2,682		$4,640				$7,323		$2,682		$4,640

 

¹Excludes The Grove at Denton; the Company acquired its joint venture partner's interest in this property on January 21, 2014. Also excludes financial results from The Grove at Stillwater, The Grove at Conway and The Grove at Lawrence. The properties were sold during 1Q 2015. Excludes The Grove at Fayetteville; the Company acquired its joint venture partner's interest in this property on August 7, 2015.  Also excludes financial results from The Grove at Norman, The Grove at Laramie and The Grove at San Angelo, as those properties were sold during 3Q 2015.  Remaining properties are The Grove at Indiana and The Grove at State College.

²Beginning with the ‘14/’15 academic year, the Company recognizes revenue for new leases over the term of the lease (typically 11.5 months) rather than in conjunction with the lease payments (typically 12 equal monthly payments). While this policy change will have no cash impact, and will have minimal year-over-year impact on a go-forward basis, the adjustment related to changing the policy has the effect of higher reported revenue in the three months and nine months ended September 30, 2015, as compared to prior year.

³Operating 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 as compared to prior year.

⁴For the three and nine months ended September 30, 2015 and 2014, includes financial results for the 2014 joint venture deliveries (The Grove at Greensboro, The Grove at Louisville, evo at Cira Centre South, evo Centre-Ville and evo Vieux-Montreal).

⁵As of September 30, 2015, the Company held preferred investments in The Grove at Indiana, The Grove at Greensboro and The Grove at Louisville of approximately $7,323.  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.

⁶As of September 30, 2014, the Company held preferred investment in The Grove at Indiana of approximately $2,682.  This preferred interest entitles the Company to a 9.0% return on the investment but otherwise does not change its effective ownership interest in this property.

  

 

CAMPUS CREST COMMUNITIES
CAPITAL STRUCTURE AS OF SEPTEMBER 30, 2015
(in $000s, except per share data)
Closing common stock price at September 30, 2015						$5.32
Common stock						64,632
Operating partnership units						12,809
Restricted stock						124
Total shares and units outstanding						77,565
Total equity market value						$412,646
Total preferred equity outstanding1						152,500
Total consolidated debt outstanding						961,265
Total market capitalization						$1,526,411
Debt to total market capitalization3, 4						63.0%
Debt to gross assets2, 3, 4						55.0%
Total number of unencumbered operating properties						28
				Weighted		Average
	Principal	% of Total		Average		Years to
Wholly Owned Debt3, 4	Outstanding	Principal Outstanding		Interest Rate		Maturity
Fixed rate mortgage loans	$396,485	41.2%		5.4%		2.4
Variable rate mortgage loan	45,920	4.8%		3.3%		1.8
Construction loans	150,583	15.7%		2.4%		1.2
Variable rate credit facility	263,500	27.4%		2.2%		1.3
Exchangeable notes5	97,925	10.2%		5.5%		3.1
Other debt6	6,852	0.7%		3.37%		6.0
Total/Weighted Average	$961,265	100.0%		3.97%		2.0
18.00% Series A cumulative redeemable preferred stock redeemable February 2017.
2Gross assets is defined as total assets plus accumulated depreciation, as reported in the Company's September 30, 2015 consolidated balance sheet.
3Excludes debt associated with Copper Beech, HSRE and Beaumont joint ventures.  See page 15 for details related to this debt.  The Company is the guarantor of certain of these loans.
4Wholly owned debt reflects principal balance, excluding impact of fair value debt and purchase accounting adjustments as reflected on the consolidated balance sheet.
5Senior unsecured exchangeable notes, maturity in October 2018.
6Includes $4,181 Line of Credit assumed as part of the Copper Beech transaction and $2,308 bond assumed as a part of the purchase of the Flagstaff, AZ property.

 

 

 

CAMPUS CREST COMMUNITIES
OUTSTANDING DEBT AND MATURITY SCHEDULE
(in $000s)
			Principal Balance at		Interest Rate		Maturity		Years to	Years to
Consolidated Debt			9/30/2015				Date		Maturity	Maturity			Notes
Corporate debt
Citi Credit facility & Term Loan			$263,500		2.21%		1/8/2017		1.3	1.3			One twelve month extension option
Exchangeable Notes1			97,925		5.53%		10/9/2018		3.1	3.1
Other debt2			6,852		3.37%		8/16/2021		6.0	6.0
Wholly Owned Construction loans - Grove
The Grove at Pullman, WA			$13,887		2.39%		9/5/2016		0.9	0.9			Two twelve month extension option
The Grove at Slippery Rock, PA			17,738		2.34%		6/21/2016		0.7	0.7			Two twelve month extension option
The Grove at Muncie, IN			13,892		2.44%		6/21/2016		0.7	0.7			Two twelve month extension option
The Grove at Ft. Collins, CO			18,998		2.09%		7/13/2016		0.8	0.8			Two twelve month extension option
The Grove at Gainesville, FL			25,593		2.34%		3/13/2017		1.5	1.5			Sixty to one hundred  twenty days extension option
Copper Beech at Ames, IA			22,051		2.44%		5/2/2017		1.6	1.6			Two twelve month extension option
Vivo at Toledo, OH			4,377		2.34%		11/25/2017		2.2	2.2			Thirty to ninety days extension option
Wholly Owned Construction loans - Copper Beech
Statesboro, GA Phase II			$9,226		2.69%		11/1/2016		1.1	1.1
CMU Phase II—Mount Pleasant, MI			9,072		2.69%		2/1/2017		1.4	1.4
Auburn, AL			15,750		2.19%		2/6/2017		1.4	1.4
Sub Total3			$150,583		2.37%				1.2	1.2
Wholly Owned Mortgage loans - Grove
The Grove at Milledgeville, GA			$15,477		6.12%		10/1/2016		1.0	1.0			Principal and interest
The Grove at Carrollton, GA			13,954		6.13%		10/11/2016		1.0	1.0			Principal and interest
The Grove at Las Cruces, NM			14,421		6.13%		10/11/2016		1.0	1.0			Principal and interest
The Grove at Denton, TX			16,420		2.34%		3/1/2017		1.4	1.4			Principal and interest, floating rate
The Grove at Asheville, NC			14,166		5.77%		4/11/2017		1.6	1.6			Principal and interest
The Grove at Ellensburg, WA			15,669		5.10%		9/1/2018		3.0	3.0			Principal and interest
The Grove at Nacogdoches, TX			16,666		5.01%		9/1/2018		3.0	3.0			Principal and interest
The Grove at Greeley, CO			14,753		4.29%		10/1/2018		3.0	3.0			Principal and interest
The Grove at Clarksville, TN			16,028		4.03%		7/1/2022		6.9	6.9			Principal and interest
The Grove at Columbia, MO			22,396		3.83%		7/1/2022		6.9	6.9			Principal and interest
The Grove at Statesboro, GA			17,895		4.01%		1/1/2023		7.4	7.4			Principal and interest
The Grove at Fayetteville, AR			14,500		5.64%		9/1/2018		3.0	3.0			Principal and interest
Wholly Owned Mortgage loans - Copper Beech
IUP Phase II - Indiana			$5,854		5.90%		10/1/2015		0.0	0.0			Principal and interest
CMU Phase I - Mount Pleasant, MI			17,911		5.47%		10/1/2015		0.0	0.0			Principal and interest
Copper Beech I - State College			4,919		5.61%		2/11/2016		0.4	0.4			Principal and interest
IUP Buy - Indiana			2,307		5.45%		6/6/2016		0.7	0.7			Principal and interest
San Marcos, TX Phase I			32,718		5.45%		6/6/2016		0.7	0.7			Principal and interest
Bloomington			10,354		6.22%		10/1/2016		1.0	1.0			Principal and interest
Allendale Phase I			22,616		5.98%		10/1/2016		1.0	1.0			Principal and interest
Columbia, MO			23,373		6.22%		10/1/2016		1.0	1.0			Principal and interest
Radford			11,807		5.99%		11/6/2016		1.1	1.1			Principal and interest
IUP Phase I - Indiana			6,500		2.15%		6/2/2017		1.7	1.7			Principal and interest
Allendale Phase II			11,485		6.27%		9/6/2017		2.0	2.0			Principal and interest
Columbia, SC Phase I			35,661		6.27%		9/6/2017		2.0	2.0			Principal and interest
Statesboro, GA Phase I			29,862		5.81%		10/6/2017		2.0	2.0			Principal and interest
Copper Beech II - State College			8,353		5.97%		8/1/2019		3.9	3.9			Principal and interest
Columbia, SC Phase II			5,837		5.41%		8/1/2020		4.9	4.9			Principal and interest
Oakwood - State College			5,502		4.99%		10/1/2020		5.1	5.1			Principal and interest
Fresno, CA			15,000		2.19%		9/5/2016		0.9	0.9			Principal and interest
Sub Total3			$442,405		5.22%				2.3	2.3
Total / Weighted Average3			$961,265		3.97%				2.0	2.0

 

¹Senior unsecured exchangeable notes, maturity in October 2018.

²Includes $4,181 Line of Credit assumed as part of the Copper Beech transaction and $2,308 bond assumed as a part of the purchase of the Flagstaff, AZ property.

³Wholly owned debt reflects principal balance, excluding impact of fair value debt and purchase accounting adjustments as reflected on the consolidated balance sheet.

 

  

CAMPUS CREST COMMUNITIES
OUTSTANDING DEBT AND MATURITY SCHEDULE - JOINT VENTURE
(in $000s)
			Principal Balance	Interest Rate	Maturity	Years to
Property	Ownership		9/30/2015		Date	Maturity		Notes
The Grove at State College, PA1	20.0%		18,619	2.24%	9/30/2015	0.0		Interest only
Copper Beech at State College, PA - Parkway Plaza	48.0%		18,500	2.15%	10/1/2018	3.0		Principal and interest
The Grove at Indiana, PA1	20.0%		17,217	2.44%	12/19/2015	0.2		Interest only
evo Centre-Ville and evo Vieux-Montreal1	47.0%		81,886	5.68%	1/13/2016	0.3		Interest only
Copper Beech at Morgantown, WV	48.0%		34,326	5.45%	6/6/2016	0.7		Principal and interest
Copper Beech at Harrisonburg, VA	48.0%		52,922	5.45%	6/6/2016	0.7		Principal and interest
evo at Cira Centre South1	30.0%		96,158	2.39%	7/25/2016	0.8		Interest only
The Grove at Louisville, KY1	30.0%		26,603	2.44%	9/6/2016	0.9		Interest only
The Grove at Greensboro, NC1	30.0%		18,428	2.29%	9/30/2018	3.0		Interest only
Copper Beech at Greenville, NC	48.0%		46,196	5.34%	9/1/2020	4.9		Principal and interest
Copper Beech at Kalamazoo, MI - Phase II	48.0%		7,742	5.68%	10/1/2020	5.0		Principal and interest
Total / Weighted Average			$418,597	4.04%		1.4
Note: The Company's pro rata share of HSRE and Beaumont joint venture debt as of September 30, 2015 was $88,011. Pro rata share of Copper Beech joint venture debt as of September 30, 2015 was $76,724.
1Footnote indicates the Company is a guarantor of the loan.

  

 

CAMPUS CREST COMMUNITIES

GROVE PORTFOLIO OVERVIEW AND OCCUPANCY

								Occupancy, as of
				Year Opened/				September 30,
Property	Grouping1		Primary University	Acquired	Properties	Units	Beds	2015	2014	Change
Wholly Owned Operating Properties - Grove
The Grove at Asheville, NC	(A)		UNC - Asheville	2005		154	448	99.1%	99.8%	(0.6%)
The Grove at Carrollton, GA	(A)		University of West Georgia	2006		168	492	97.0%	93.1%	3.9%
The Grove at Las Cruces, NM	(A)		New Mexico State University	2006		168	492	81.7%	81.7%	0.0%
The Grove at Milledgeville, GA	(A)		Georgia College & State University	2006		168	492	96.1%	99.4%	(3.3%)
The Grove at Abilene, TX	(A)		Abilene Christian University	2007		192	504	90.5%	91.3%	(0.8%)
The Grove at Ellensburg, WA	(A)		Central Washington University	2007		192	504	86.3%	100.0%	(13.7%)
The Grove at Greeley, CO	(A)		University of Northern Colorado	2007		192	504	99.8%	100.0%	(0.2%)
The Grove at Mobile, AL—Phase I & II2	(A)		University of South Alabama	2007/2008		384	1,008	86.3%	86.4%	(0.1%)
The Grove at Nacogdoches, TX—Phase I & II2	(A)		Stephen F. Austin State Univ.	2007/2012		260	682	85.5%	83.1%	2.3%
The Grove at Cheney, WA	(A)		Eastern Washington University	2008		192	512	99.6%	94.7%	4.9%
The Grove at Lubbock, TX	(A)		Texas Tech University	2008		192	504	94.2%	92.5%	1.8%
The Grove at Stephenville, TX	(A)		Tarleton State University	2008		192	504	100.0%	100.0%	0.0%
The Grove at Troy, AL	(A)		Troy University	2008		192	514	96.5%	98.6%	(2.1%)
The Grove at Waco, TX	(A)		Baylor University	2008		192	504	87.3%	90.3%	(3.0%)
The Grove at Murfreesboro, TN	(A)		Middle Tennessee State University	2009		186	504	94.0%	99.8%	(5.8%)
The Grove at San Marcos, TX	(A)		Texas State University	2009		192	504	99.0%	96.4%	2.6%
The Grove at Moscow, ID	(A)		University of Idaho	2009		192	504	97.2%	84.7%	12.5%
The Grove at Huntsville, TX	(A)		Sam Houston State University	2010		192	504	100.0%	100.0%	0.0%
The Grove at Statesboro, GA	(A)		Georgia Southern University	2010		200	536	76.9%	86.6%	(9.7%)
The Grove at Ames, IA	(A)		Iowa State University	2011		216	584	98.3%	100.0%	(1.7%)
The Grove at Clarksville, TN	(A)		Austin Peay State University	2011		208	560	71.6%	74.1%	(2.5%)
The Grove at Columbia, MO	(A)		University of Missouri	2011		216	632	85.3%	74.1%	11.2%
The Grove at Ft. Wayne, IN	(A)		Indiana University-Purdue University Ft. Wayne	2011		204	540	71.5%	77.6%	(6.1%)
The Grove at Valdosta, GA	(A)		Valdosta State University	2011		216	584	91.6%	86.6%	5.0%
The Grove at Denton, TX	(A)		University of North Texas	2011		216	584	98.6%	100.0%	(1.4%)
The Grove at Auburn, AL	(A)		Auburn University	2012		216	600	99.7%	100.0%	(0.3%)
The Grove at Fayetteville, AR	(A)		University of Arkansas	2012		232	632	86.2%	66.5%	19.8%
The Grove at Flagstaff, AZ	(A)		Northern Arizona University	2012		216	584	99.0%	99.3%	(0.3%)
The Grove at Orono, ME	(A)		University of Maine	2012		188	620	97.4%	100.0%	(2.6%)
The Grove at Ft. Collins, CO	(A)		Colorado State University	2013		218	612	100.0%	100.0%	0.0%
The Grove at Muncie, IN	(A)		Ball State University	2013		216	584	83.4%	87.3%	(3.8%)
The Grove at Pullman, WA3	(A)		Washington State University	2013		216	584	99.3%	100.0%	(0.8%)
The Grove at Flagstaff, AZ - Phase II2	(A)		Northern Arizona University	2013		54	192	98.4%	99.5%	(1.0%)
The Grove at Gainesville, FL	(B)		University of Florida	2014		256	682	99.9%	54.3%	45.6%
The Grove at Grand Forks, ND	(B)		University of North Dakota	2014		224	600	67.5%	99.8%	(32.3%)
The Grove at Mt. Pleasant, MI	(B)		Central Michigan University	2014		224	584	68.3%	76.2%	(7.9%)
The Grove at Slippery Rock, PA	(B)		Slippery Rock University	2014		201	603	93.0%	85.4%	7.6%
Total - Wholly Owned Operating Properties - Grove					37	7,537	20,577	90.9%	91.7%	(0.8%)

 

 

¹ Groupings detailed as follows: (A) reflects the same store properties as of September 30, 2015; (B) reflects the 2014 development deliveries.

²The Grove at Flagstaff, AZ - 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 Mobile, AL—Phase II are not counted as separate assets from Phase I of each respective asset.

³ On July 14, 2013, the Company experienced a fire at this development property. As of September 30, 2015, all 584 beds are in operation.

 

 

CAMPUS CREST COMMUNITIES

COPPER BEECH PORTFOLIO OVERVIEW AND OCCUPANCY1

										Occupancy, as of
				Year Opened/						September 30,
Property	Grouping		Primary University	Acquired		Properties	Units	Beds		2015		2014	Change
Wholly Owned Operating Properties - Copper Beech
Copper Beech at Bloomington, IN - Colonial Crest	(A)		Indiana University	1970			206	402		86.3%		77.1%	9.2%
Copper Beech at Indiana, PA - IUP I	(A)		Indiana University of Pennsylvania	1971			95	239		88.3%		100.0%	(11.7%)
Copper Beech at Indiana, PA - IUP II	(A)		Indiana University of Pennsylvania	1973			72	172		90.1%		100.0%	(9.9%)
Copper Beech at Indiana, PA - IUP Buy	(A)		Indiana University of Pennsylvania	1975			43	76		85.5%		100.0%	(14.5%)
Copper Beech at State College, PA - CB I	(A)		Penn State University	1996			59	177		100.0%		100.0%	0.0%
Copper Beech at State College, PA - CB II	(A)		Penn State University	1998			87	257		100.0%		100.0%	0.0%
Copper Beech at State College, PA - Oakwood	(A)		Penn State University	2000			48	144		100.0%		100.0%	0.0%
Copper Beech at Harrisonburg, VA - Grand Duke	(A)		James Madison University	2001			120	124		98.4%		100.0%	(1.6%)
Copper Beech at State College, PA - Oak Hill	(A)		Penn State University	2003			106	318		100.0%		100.0%	0.0%
Copper Beech at State College, PA - Northbrook Greens	(A)		Penn State University	2003			166	250		99.2%		100.0%	(0.8%)
Copper Beech at West Lafayette, IN – Klondike	(A)		Purdue University	2003			219	486		89.5%		87.4%	2.1%
Copper Beech at West Lafayette, IN – Baywater	(A)		Purdue University	2004			137	488		85.9%		70.1%	15.8%
Copper Beech at Radford, VA	(A)		Radford University	2005			222	500		98.8%		100.0%	(1.2%)
Copper Beech at Bloomington, IN	(A)		Indiana University	2005			107	297		76.8%		71.0%	5.7%
Copper Beech at Mount Pleasant, MI - Phase I	(A)		Central Michigan University	2005			204	632		63.0%		100.0%	(37.0%)
Copper Beech at Bowling Green, OH - Phase I	(A)		Bowling Green University	2005			128	400		100.0%		99.8%	0.2%
Copper Beech at Fresno, CA	(A)		California State University at Fresno	2006			178	506		98.8%		90.1%	8.7%
Copper Beech at Allendale, MI - Phase I	(A)		Grand Valley State University	2006			206	614		99.5%		100.0%	(0.5%)
Copper Beech at Columbia, MO	(A)		University of Missouri	2006			214	654		96.3%		89.4%	6.9%
Copper Beech at Bowling Green, OH - Phase II	(A)		Bowling Green University	2007			72	216		98.6%		100.0%	(1.4%)
Copper Beech at Allendale, MI - Phase II	(A)		Grand Valley State University	2007			82	290		100.0%		100.0%	0.0%
Copper Beech at Columbia, SC - Phase I	(A)		University of South Carolina	2007			278	824		49.3%		97.6%	(48.3%)
Copper Beech at Statesboro, GA - Phase I	(A)		Georgia Southern University	2007			246	754		94.4%		97.1%	(2.7%)
Copper Beech at Columbia, SC - Phase II	(A)		University of South Carolina	2008			72	178		52.8%		98.3%	(45.5%)
Copper Beech at Auburn, AL	(A)		Auburn University	2009			271	754		97.6%		92.7%	4.9%
Copper Beech at San Marcos, TX - Phase I	(A)		Texas State University	2011			273	840		96.2%		88.7%	7.5%
Copper Beech at San Marcos, TX - Phase II	(A)		Texas State University	2012			142	410		96.1%		88.3%	7.8%
Copper Beech at Mount Pleasant, MI - Phase II	(A)		Central Michigan University	2013			119	256		98.0%		94.5%	3.5%
Copper Beech at Statesboro, GA - Phase II	(A)		Georgia Southern University	2013			82	262		96.9%		98.5%	(1.5%)
Copper Beech at Ames, IA	(B)		Iowa State University	2014			219	636		100.0%		81.3%	18.7%
Sub-Total / Weighted Average						30	4,473	12,156		90.1%		93.4%	(3.2%)
Joint Venture Operating Properties - Copper Beech
Copper Beech at State College, PA - Parkway Plaza	(A)		Penn State University	1967			429	633		99.7%		98.7%	0.9%
Copper Beech at Harrisonburg, VA	(A)		James Madison University	2008			414	1,218		96.1%		99.9%	(3.9%)
Copper Beech at Greenville, NC	(A)		East Carolina University	2008			439	1,232		96.9%		95.5%	1.4%
Copper Beech at Kalamazoo, MI - Phase II	(A)		Western Michigan University	2008			115	340		74.7%		67.6%	7.1%
Copper Beech at Morgantown, WV	(A)		West Virginia University	2010			335	920		98.3%		100.0%	(1.7%)
Total - Copper Beech Portfolio						35	6,205	16,499		91.6%		94.1%	(2.5%)

 

 

CAMPUS CREST COMMUNITIES

HSRE AND BEAUMONT PORTFOLIO OVERVIEW AND OCCUPANCY (cont'd)

								Occupancy, as of
				Year Opened/				September 30,
Property	Grouping1		Primary University	Acquired	Properties	Units	Beds	2015	2014	Change
HSRE and Beaumont Joint Venture Operating Properties
The Grove at Indiana, PA	(A)		Indiana University of Pennsylvania	2013		224	600	69.5%	65.7%	3.8%
The Grove at State College, PA	(A)		Penn State University	2013		216	584	100.0%	100.0%	0.0%
The Grove at Greensboro, NC	(B)		University of North Carolina at Greensboro	2014		216	584	76.2%	57.4%	18.8%
The Grove at Louisville, KY	(B)		University of Louisville	2014		252	656	65.2%	61.4%	3.8%
evo at Cira Centre South	(B)		University of Pennsylvania / Drexel University	2014		344	850	97.3%	46.7%	50.6%
evo Centre-Ville	(B)		Concordia University / McGill University / (ÉTS)	2014		715	1,294	53.3%	8.0%	45.3%
evo Vieux-Montreal	(B)		McGill University	2014		488	929	43.8%	13.0%	30.8%
Total - Joint Venture Operating Properties					7	2,455	5,497	69.1%	42.5%	26.6%
Total Operating Properties2					79	16,197	42,573	88.3%	92.4%	(4.1%)
Same Store Properties (A)
Wholly-Owned					62	10,886	29,628	91.0%	92.3%	(1.3%)
Joint Venture					7	2,172	5,527	93.3%	93.1%	0.1%
Total - Same Store					69	13,058	35,155	91.4%	92.4%	(1.1%)
2014 Deliveries (B)
Wholly-Owned					5	1,124	3,105	86.4%	78.8%	7.6%
Joint Venture					5	2,015	4,313	64.8%	31.5%	33.3%
Total - 2014 Deliveries					10	3,139	7,418	73.9%	51.3%	22.6%

 

1 Groupings detailed as follows: (A) reflects the same store properties as of June 30, 2015; (B) reflects the 2014 development deliveries.

² 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 the Grove at Denton on January 21, 2014. The occupancy data related to Denton is included in 2014 deliveries.

 

 

CAMPUS CREST COMMUNITIES

INVESTOR INFORMATION

Executive Management
David Coles	Interim Chief Executive Officer
Aaron Halfacre	President and Chief Investment Officer
John Makuch	Interim Chief Financial Officer
Scott Rochon	Chief Accounting 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
Raymond James & Associates	Paul D. Puryear / Buck Horne		(727) 567-2253 / (727) 567-2561		paul.puryear@raymondjames.com / buck.horne@raymondjames.com
Sidoti & Company, LLC	Jeff Lau		(212) 453-7029		jlau@sidoti.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

 

 

CAMPUS CREST COMMUNITIES

 

FORWARD - LOOKING STATEMENTS

 

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 2013 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.