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American Campus Completes Purchase Of Campus Acquisitions Portfolio

American Campus Communities, Inc. (NYSE:ACC), the largest owner, manager and developer of high-quality student housing properties in the U.S., today announced the completion of the previously announced acquisition of Campus Acquisitions’ 15 student housing properties with 6,579 beds for a purchase price of $627.0 million. The acquisition consideration consists of the assumption of approximately $231.1 million of outstanding mortgage debt, the issuance of 325,098 Operating Partnership units valued at $46.14 per unit, and approximately $380.9 million in cash.

“These assets exemplify our investment criteria of differentiated products in close proximity to campus in submarkets with high barriers to entry,” said Bill Bayless, American Campus CEO. “With the implementation of our operating platform across the portfolio, we should achieve operational efficiencies and upside, synergies within the seven markets where we have existing properties, and meaningful accretion in asset value.”

American Campus believes these assets represent some of the best product in their respective markets with a combined distance to campus of 0.23 miles. Eleven properties are located in seven existing American Campus markets, with the remaining four located in four new tier one markets including Baylor University, University of Southern California, Iowa State University, and Purdue University. In addition to implementing the company’s proprietary operating platform across the portfolio, the company anticipates investing $13.7 million in capital improvements to drive future rental rate and revenue growth. The projected year-one cap rate is 5.9 percent nominal (inclusive of upfront capital improvements) and 5.6 percent economic (inclusive of the assumed $200 per bed capital reserves, upfront capital improvements, loan assumption costs, and transaction expenses).

The 15 communities include:

BofA Merrill Lynch acted as exclusive financial adviser to American Campus. Locke Lord LLP served as legal counsel to the company. UBS Investment Bank acted as financial adviser to Campus Acquisitions.

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