Education Realty Trust, Inc. - FORM 8-K - EX-99.2 - EXHIBIT 99.2 THIRD QUARTER 2015 SUPPLEMENTAL - November 2, 2015

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FINANCIAL HIGHLIGHTS

 (Amounts in thousands, except per share data, unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 OPERATING DATA:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three months ended September 30,
 
Nine months ended September 30,
 
 
2015
 
2014
 
$ Chg
 
% Chg
 
2015
 
2014
 
$ Chg
 
% Chg
 
Same-community revenue
$
42,155

 
$
40,064

 
$
2,091

 
5.2
 %
 
$
134,872

 
$
127,157

 
$
7,715

 
6.1
 %
 
Total community revenue
54,725

 
47,657

 
7,068

 
14.8
 %
 
168,842

 
144,677

 
24,165

 
16.7
 %
 
Total revenue
58,189

 
54,704

 
3,485

 
6.4
 %
 
179,642

 
159,289

 
20,353

 
12.8
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Same-community net operating income
18,823

 
17,611

 
1,212

 
6.9
 %
 
72,959

 
68,306

 
4,653

 
6.8
 %
 
Total community net operating income
26,281

 
20,737

 
5,544

 
26.7
 %
 
93,390

 
74,615

 
18,775

 
25.2
 %
 
Total operating income
2,417

 
1,765

 
652

 
36.9
 %
 
25,198

 
6,427

 
18,771

 
292.1
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income (loss) attributable to EdR
(4,720
)
 
21,400

 
(26,120
)
 
(122.1
)%
 
5,138

 
24,658

 
(19,520
)
 
(79.2
)%
 
Per share - basic
$
(0.10
)
 
$
0.46

 
$
(0.56
)
 
(121.7
)%
 
$
0.11

 
$
0.60

 
$
(0.49
)
 
(81.7
)%
 
Per share - diluted
(0.10
)
 
0.45

 
(0.55
)
 
(122.2
)%
 
0.11

 
0.59

 
(0.48
)
 
(81.4
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Funds from operations (FFO)
13,142

 
20,359

 
(7,217
)
 
(35.4
)%
 
55,005

 
52,696

 
2,309

 
4.4
 %
 
Per weighted average share/unit (1)
$
0.27

 
$
0.43

 
$
(0.16
)
 
(37.2
)%
 
$
1.13

 
$
1.26

 
$
(0.13
)
 
(10.3
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Core funds from operations (Core FFO)
14,540

 
14,840

 
(300
)
 
(2.0
)%
 
58,894

 
51,465


7,429

 
14.4
 %
 
Per weighted average share/unit (1)
$
0.30

 
$
0.31

 
$
(0.01
)
 
(3.2
)%
 
$
1.21

 
$
1.23

 
$
(0.02
)
 
(1.6
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
FINANCIAL RATIOS:
 
 
 
 
 
 
 
 
 
 
9/30/2015
 
12/31/2014
 
 
 
 
 
 
 
 
 
Debt to gross assets
39.9%
 
35.1%
 
 
 
 
 
 
 
 
 
Net debt to enterprise value
35.3%
 
28.1%
 
 
 
 
 
 
 
 
 
Interest coverage ratio (TTM)
4.8x
 
5.0x
 
 
 
 
 
 
 
 
 
Net debt to EBITDA - Adjusted (TTM)
6.3x
 
4.9x
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1)  FFO and Core FFO per share/unit were computed using weighted average shares and units outstanding, regardless of their dilutive impact. See page 5 for a detailed calculation.

THIRD QUARTER 2015
1
BALANCE SHEET

(Amount in thousands, except share and per share data)
 
September 30, 2015
 
December 31, 2014
 
 Assets
 
 (unaudited)
 
 
 
 
Collegiate housing properties, net (1)
 
$
1,798,809

 
$
1,586,009

 
 
Assets under development
 
71,065

 
120,702

 
 
Cash and cash equivalents
 
14,169

 
18,385

 
 
Restricted cash
 
10,442

 
10,342

 
 
Other assets
 
81,870

 
76,199

 
 Total assets
 
$
1,976,355

 
$
1,811,637

 
 
 
 
 
 
 
 Liabilities and equity
 
 
 
 
 
 Liabilities:
 
 
 
 
 
 
Mortgage and construction loans, net of unamortized premium
 
$
233,081

 
$
249,637

 
 
Unsecured revolving credit facility
 
221,000

 
24,000

 
 
Unsecured term loans
 
187,500

 
187,500

 
 
Senior unsecured notes
 
250,000

 
250,000

 
 
Accounts payable and accrued expenses
 
92,088

 
76,869

 
 
Deferred revenue
 
22,699

 
17,301

 
 Total liabilities
 
1,006,368

 
805,307

 
 
 
 
 
 
 
 
 Commitments and contingencies
 
—

 
—

 
 Redeemable noncontrolling interests
 
12,450

 
14,512

 
 
 
 
 
 
 
 
 Equity:
 
 
 
 
 
 EdR stockholders' equity:
 
 
 
 
 
 
Common stock, $0.01 par value per share, 200,000,000 shares authorized, 48,362,091 and 47,999,427 shares issued and outstanding as of September 30, 2015 and December 31, 2014, respectively
 
484

 
480

 
 
Preferred shares, $0.01 par value per share, 50,000,000 shares authorized, no shares issued and outstanding
 
—

 
—

 
 
Additional paid-in capital
 
996,039

 
1,034,683

 
 
Accumulated deficit
 
(36,771
)
 
(41,909
)
 
 
Accumulated other comprehensive loss
 
(7,894
)
 
(4,465
)
 
 Total EdR stockholders' equity
 
951,858

 
988,789

 
 Noncontrolling interest
 
5,679

 
3,029

 
 Total equity
 
957,537

 
991,818

 
 Total liabilities and equity
 
$
1,976,355

 
$
1,811,637

 
(1) Amount is net of accumulated depreciation of $257,628 and $210,047, as of September 30, 2015 and December 31, 2014, respectively.

THIRD QUARTER 2015
2
OPERATING RESULTS

(Amounts in thousands, except per share data, unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
Three months ended September 30,
 
Nine months ended September 30,
 
2015
 
2014
 
$ Change
 
2015
 
2014
 
$ Change
Revenues:
 
 
 
 
 
 
 
 
 
 
 
     Collegiate housing leasing revenue
$
54,725

 
$
47,657

 
$
7,068

 
$
168,842

 
$
144,677

 
$
24,165

     Third-party development consulting services
490

 
3,705

 
(3,215
)
 
1,531

 
5,264

 
(3,733
)
     Third-party management services
865

 
1,052

 
(187
)
 
2,698

 
2,856

 
(158
)
     Operating expense reimbursements
2,109

 
2,290

 
(181
)
 
6,571

 
6,492

 
79

     Total revenues
58,189

 
54,704

 
3,485

 
179,642

 
159,289

 
20,353

Operating expenses:
 
 
 
 
 
 
 
 
 
 


     Collegiate housing leasing operations
28,444

 
26,920

 
1,524

 
75,452

 
70,062

 
5,390

     Development and management services
3,019

 
2,337

 
682

 
8,228

 
6,964

 
1,264

     General and administrative
1,988

 
2,358

 
(370
)
 
6,227

 
6,147

 
80

     Development pursuit, acquisition costs and severance
(554
)
 
1,064

 
(1,618
)
 
405

 
1,373

 
(968
)
     Depreciation and amortization
17,828

 
14,688

 
3,140

 
49,605

 
42,928

 
6,677

     Ground lease expense
2,938

 
2,329

 
609

 
7,956

 
6,162

 
1,794

     Loss on impairment of collegiate housing properties
—

 
953

 
(953
)
 
—

 
12,734

 
(12,734
)
     Reimbursable operating expenses
2,109

 
2,290

 
(181
)
 
6,571

 
6,492

 
79

     Total operating expenses
55,772

 
52,939

 
2,833

 
154,444

 
152,862

 
1,582

Operating income
2,417

 
1,765

 
652

 
25,198

 
6,427

 
18,771

Nonoperating (income) expenses:
 
 
 
 
 
 
 
 
 
 


     Interest expense
6,223

 
4,508

 
1,715

 
17,615

 
15,076

 
2,539

     Amortization of deferred financing costs
520

 
516

 
4

 
1,527

 
1,533

 
(6
)
     Interest income
(39
)
 
(9,527
)
 
9,488

 
(144
)
 
(9,638
)
 
9,494

     Gain on insurance settlement
—

 
(8,133
)
 
8,133

 
—

 
(8,133
)
 
8,133

     Loss on extinguishment of debt
—

 
243

 
(243
)
 
—

 
892

 
(892
)
Total nonoperating expenses (income)
6,704

 
(12,393
)
 
19,097

 
18,998

 
(270
)
 
19,268

Income (loss) before equity in losses of unconsolidated entities, income taxes and gain on sale of collegiate housing properties
(4,287
)
 
14,158

 
(18,445
)
 
6,200

 
6,697

 
(497
)
Equity in losses of unconsolidated entities
(427
)
 
(236
)
 
(191
)
 
(823
)
 
(370
)
 
(453
)
Income (loss) before income taxes and gain on sale of collegiate housing properties
(4,714
)
 
13,922

 
(18,636
)
 
5,377

 
6,327

 
(950
)
Income tax expense
157

 
910

 
(753
)
 
325

 
598

 
(273
)
Income (loss) before gain on sale of collegiate housing properties
(4,871
)
 
13,012

 
(17,883
)
 
5,052

 
5,729

 
(677
)
Gain on sale of collegiate housing properties
—

 
8,421

 
(8,421
)
 
—

 
19,322

 
(19,322
)
Net income (loss)
(4,871
)
 
21,433

 
(26,304
)
 
5,052

 
25,051

 
(19,999
)

THIRD QUARTER 2015
3
OPERATING RESULTS

(Amounts in thousands, except per share data, unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
Three months ended September 30,
 
Nine months ended September 30,
 
2015
 
2014
 
$ Change
 
2015
 
2014
 
$ Change
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Less: Net income (loss) attributable to the noncontrolling interests
(151
)
 
33

 
(184
)
 
(86
)
 
393

 
(479
)
Net income (loss) attributable to Education Realty Trust, Inc.
$
(4,720
)
 
$
21,400

 
$
(26,120
)
 
$
5,138

 
$
24,658

 
$
(19,520
)
 
 
 
 
 
 
 
 
 
 
 
 
Other comprehensive income (loss):
 
 
 
 
 
 
 
 
 
 
 
      Gain (loss) on cash flow hedging derivatives
(3,081
)
 
1,343

 
(4,424
)
 
(3,429
)
 
(2,414
)
 
(1,015
)
Comprehensive income (loss)
$
(7,801
)
 
$
22,743

 
$
(30,544
)
 
$
1,709

 
$
22,244

 
$
(20,535
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Earnings per share information:
 
 
 
 
 
 
 
 
 
 


Net income (loss) attributable to Education Realty Trust, Inc. common stockholders per share – basic
$
(0.10
)
 
$
0.46

 
$
(0.56
)
 
$
0.11

 
$
0.60

 
$
(0.49
)
Net income (loss) attributable to Education Realty Trust, Inc. common stockholders per share – diluted
$
(0.10
)
 
$
0.45

 
$
(0.55
)
 
$
0.11

 
$
0.59

 
$
(0.48
)
 
 
 
 
 
 
 
 
 
 
 
 
Weighted average shares of common stock outstanding – basic
48,526

 
46,767

 
1,759

 
48,406

 
41,340

 
7,066

Weighted average shares of common stock outstanding – diluted (1)
48,526

 
47,113

 
1,413

 
48,726

 
41,686

 
7,040

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) Weighted average shares of common stock outstanding - diluted assumes the conversion of outstanding redeemable Operating Partnership Units and University Towers Operating Partnership Units.

THIRD QUARTER 2015
4
FUNDS FROM OPERATIONS

(Amounts in thousands, except per share data, unaudited)
Three months ended September 30,
 
Nine months ended September 30,
 
 
2015
 
2014
 
$ Change
 
2015
 
2014
 
$ Change
Net income (loss) attributable to EdR
$
(4,720
)
 
$
21,400

 
$
(26,120
)
 
$
5,138

 
$
24,658

 
$
(19,520
)
 
Gain on sale of collegiate housing assets
—

 
(8,421
)
 
8,421

 
—

 
(19,322
)
 
19,322

 
Gain on insurance settlement (1)
—

 
(8,133
)
 
8,133

 
—

 
(8,133
)
 
8,133

 
Impairment losses
—

 
953

 
(953
)
 
—

 
12,734

 
(12,734
)
 
Real estate related depreciation and amortization
17,433

 
14,444

 
2,989

 
48,473

 
42,365

 
6,108

 
Equity portion of real estate depreciation and amortization on equity investees
514

 
45

 
469

 
1,357

 
144

 
1,213

 
Noncontrolling interests
(85
)
 
71

 
(156
)
 
37

 
250

 
(213
)
Funds from operations ("FFO") available to stockholders and unitholders
13,142

 
20,359

 
(7,217
)
 
55,005

 
52,696

 
2,309

 
percent change
 
 
 
 
(35.4
)%
 
 
 
 
 
4.4
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
FFO adjustments:
 
 
 
 
 
 
 
 
 
 
 
 
Loss on extinguishment of debt
—

 
243

 
(243
)
 
—

 
892

 
(892
)
 
Acquisition costs
203

 
1,034

 
(831
)
 
293

 
1,058

 
(765
)
 
Severance costs, net of tax
—

 
29

 
(29
)
 
—

 
314

 
(314
)
 
Straight-line adjustment for ground leases (2)
1,195

 
1,209

 
(14
)
 
3,596

 
3,634

 
(38
)
FFO adjustments
1,398

 
2,515

 
(1,117
)
 
3,889

 
5,898

 
(2,009
)
 
 
 
 
 
 
 
 
 
 
 
 
 
FFO on Participating Developments:(3)
 
 
 
 
 
 
 
 
 
 
 
 
Interest on loan to Participating Development
—

 
(6,486
)
 
6,486

 
—

 
(5,581
)
 
5,581

 
Development fees on Participating Development, net of costs and taxes
—

 
(1,548
)
 
1,548

 
—

 
(1,548
)
 
1,548

FFO on Participating Developments
—

 
(8,034
)
 
8,034

 
—

 
(7,129
)
 
7,129

 
 
 
 
 
 
 
 
 
 
 
 
 
Core funds from operations ("Core FFO") available to stockholders and unitholders
$
14,540

 
$
14,840

 
$
(300
)
(5) 
$
58,894

 
$
51,465

 
$
7,429

 
percent change
 
 
 
 
(2.0
)%
 
 
 
 
 
14.4
 %
 
 
 
 
 
 


 
 
 
 
 
 
FFO per weighted average share/unit (4)
$
0.27

 
$
0.43

 
$
(0.16
)
 
$
1.13

 
$
1.26

 
$
(0.13
)
 
percent change
 
 
 
 
(37.2
)%
 
 
 
 
 
(10.3
)%
Core FFO per weighted average share/unit (4)
$
0.30

 
$
0.31

 
$
(0.01
)
 
$
1.21

 
$
1.23

 
$
(0.02
)
 
percent change
 
 
 
 
(3.2
)%
 
 
 
 
 
(1.6
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted average shares/units (4)
48,844

 
47,113

 
1,731

 
48,726

 
41,686

 
7,040

 
percent change
 
 
 
 
3.7
 %
 
 
 
 
 
16.9
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
(1)  Represents gain on insurance settlement at 3949 Lindell. The community was damaged by fire in July 2012. All claims were settled during the three months ended September 30, 2014, at which time the gain was recognized.
(2)  This represents the straight-line rent expense adjustment required by GAAP related to ground leases. As the ground lease terms range from 40 to 99 years, the adjustment to straight-line these agreements becomes material to our operating results, distorting the economic results of the communities.
(3)  FFO on participating developments in 2014 represents the economic impact of interest and fees not recognized in net income due to the Company having a participating investment in the third-party development. The adjustment for interest income is based on terms of the loan. In July 2014, our mezzanine investment was repaid in full, ending the Company's participation in the project and any fees and interest. At the same time all previously deferred amounts were recognized in net income.
(4)  FFO and Core FFO per weighted average share/unit were computed using the weighted average of all shares and partnership units outstanding, regardless of their dilutive impact.
(5)  Core FFO for the quarter was $14.5 million, as compared to $14.8 million in the prior year, a decline of 2.0%, mainly due to the $3.0 million Johns Hopkins guarantee fee recognized in the third quarter of 2014. Without the impact of the guarantee fee, Core FFO increased 22.8% over the prior year, with the increase mainly driven by a $5.5 million increase in total community NOI and a $0.4 million reduction in G&A costs, partially offset by a $0.8 million decrease in third-party fees and a $1.7 million increase in interest expense.

THIRD QUARTER 2015
5
COMMUNITY OPERATING RESULTS

(Amounts in thousands, unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
 
2015
 
2014
 
$ Change
 
% Change
 
2015
 
2014
 
$ Change
 
% Change
Revenues
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Same-communities(1)
$
42,155

 
$
40,064

 
$
2,091

 
5.2
%
 
$
134,872

 
$
127,157

 
$
7,715

 
6.1
%
 
New-communities (2)
12,203

 
4,929

 
7,274

 
NM

 
32,869

 
5,114

 
27,755

 
NM

 
Sold-communities(3)
—

 
2,664

 
(2,664
)
 
NM

 
—

 
12,406

 
(12,406
)
 
NM

 
CA revenue(4)
367

 
—

 
367

 
NM

 
1,101

 
—

 
1,101

 
NM

Total revenues
54,725

 
47,657

 
7,068

 
14.8
%
 
168,842

 
144,677

 
24,165

 
16.7
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating expenses (5)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Same-communities(1)
23,332

 
22,453

 
879

 
3.9
%
 
61,913

 
58,851

 
3,062

 
5.2
%
 
New-communities (2)
4,745

 
2,180

 
2,565

 
NM

 
12,438

 
3,314

 
9,124

 
NM

 
Sold-communities(3)
—

 
2,287

 
(2,287
)
 
NM

 
—

 
7,897

 
(7,897
)
 
NM

 
CA expense(4)
367

 
—

 
367

 
NM

 
1,101

 
—

 
1,101

 
NM

Total operating expenses
28,444

 
26,920

 
1,524

 
5.7
%
 
75,452

 
70,062

 
5,390

 
7.7
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net operating income
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Same-communities(1)
18,823

 
17,611

 
1,212

 
6.9
%
 
72,959

 
68,306

 
4,653

 
6.8
%
 
New-communities (2)
7,458

 
2,749

 
4,709

 
NM

 
20,431

 
1,800

 
18,631

 
NM

 
Sold-communities(3)
—

 
377

 
(377
)
 
NM

 
—

 
4,509

 
(4,509
)
 
NM

Total net operating income
$
26,281

 
$
20,737

 
$
5,544

 
26.7
%
 
$
93,390

 
$
74,615

 
$
18,775

 
25.2
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) Same-communities are defined as those communities that have been open and operating for the whole time in the current and prior periods. See page 25 of this supplement for a listing of same-communities.
(2) See page 25 of this supplement for a listing of which communities are categorized as new-communities.
(3) Represents operating results from communities sold in 2014. No communities have been sold in 2015.
(4) Represents additional same-community revenue and expenses incurred as a result of the Company changing its community assistant program at the end of 2014. The amounts are shown separately as there is no NOI impact and to clearly show the operating growth in revenue and expenses year over year.
(5) Represents community level operating expenses, excluding management fees, depreciation, amortization, ground lease expense and impairment charges, plus regional and other corporate costs of supporting the communities.



THIRD QUARTER 2015
6
SAME-COMMUNITY EXPENSES BY CATEGORY

(Amounts in thousands, except bed and per-bed data, unaudited)
 
Three months ended September 30, 2015
 
Three months ended September 30, 2014
 
 
 
 
 
Amount
 
Per Bed
 
% of Total Operating Expenses
 
Amount
 
Per Bed
 
% of Total Operating Expenses
 
$ Change
 
% Change
Utilities(1)
$
5,865

 
$
254

 
25
%
 
$
5,624

 
$
244

 
25
%
 
$
241

 
4.3
 %
On-Site Payroll
3,674

 
159

 
16
%
 
3,452

 
150

 
15
%
 
222

 
6.4
 %
General & Administrative(2)
3,267

 
142

 
14
%
 
3,424

 
148

 
15
%
 
(157
)
 
(4.6
)%
Maintenance & Repairs(3)
4,795

 
208

 
21
%
 
4,501

 
195

 
20
%
 
294

 
6.5
 %
Marketing
875

 
38

 
4
%
 
936

 
41

 
5
%
 
(61
)
 
(6.5
)%
Total Direct Operating Expenses
$
18,476

 
$
801

 
80
%
 
$
17,937

 
$
778

 
80
%
 
$
539

 
3.0
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Real Estate Taxes
4,280

 
185

 
18
%
 
3,956

 
171

 
18
%
 
324

 
8.2
 %
Insurance
576

 
25

 
2
%
 
560

 
24

 
2
%
 
16

 
2.9
 %
Total Fixed Operating Expenses
$
4,856

 
$
210

 
20
%
 
$
4,516

 
$
195

 
20
%
 
$
340

 
7.5
 %
Total Property Operating Expenses
$
23,332

 
$
1,011

 
100
%
 
$
22,453

 
$
973

 
100
%
 
$
879

 
3.9
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Nine months ended September 30, 2015
 
Nine months ended September 30, 2014
 
 
 
 
 
Amount
 
Per Bed
 
% of Total Operating Expenses
 
Amount
 
Per Bed
 
% of Total Operating Expenses
 
$ Change
 
% Change
Utilities(1)
$
16,962

 
$
735

 
27
%
 
$
16,129

 
$
699

 
27
%
 
$
833

 
5.2
 %
On-Site Payroll
10,626

 
460

 
17
%
 
9,965

 
432

 
17
%
 
661

 
6.6
 %
General & Administrative(2)
9,160

 
397

 
15
%
 
9,546

 
414

 
16
%
 
(386
)
 
(4.0
)%
Maintenance & Repairs(3)
7,468

 
324

 
12
%
 
6,867

 
298

 
12
%
 
601

 
8.8
 %
Marketing
2,638

 
114

 
4
%
 
2,719

 
118

 
5
%
 
(81
)
 
(3.0
)%
Total Direct Operating Expenses
$
46,854

 
$
2,030

 
75
%
 
$
45,226

 
$
1,961

 
77
%
 
$
1,628

 
3.6
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Real Estate Taxes
13,329

 
578

 
22
%
 
11,933

 
$
517

 
20
%
 
$
1,396

(4) 
11.7
 %
Insurance
1,730

 
75

 
3
%
 
1,692

 
73

 
3
%
 
38

 
2.2
 %
Total Fixed Operating Expenses
$
15,059

 
$
653

 
25
%
 
$
13,625

 
$
590

 
23
%
 
$
1,434

 
10.5
 %
Total Property Operating Expenses
$
61,913

 
$
2,683

 
100
%
 
$
58,851

 
$
2,551

 
100
%
 
$
3,062

(4) 
5.2
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Same-community beds
23,079

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
NOTE: Schedule does not include $0.4 million and $1.1 million of expenses for the three months ended September 30, 2015 and the nine months ended September 30, 2015, respectively, related to the Company's change in its community assistant program at the end of the prior year. See note 4 on page 6.
 
 
 
(1) Represents gross costs before recoveries from tenants and includes student amenities such as internet.
(2) Includes property-level general and administrative cost and dining costs as well as regional and other corporate costs of supporting the communities.
(3) Includes general maintenance costs, grounds and landscaping, turn costs and life safety costs.
(4) During the first quarter of 2015 the Company accrued an additional $0.8 million in real estate taxes relating to the settlement of an assessment dispute with a local school board at one community covering several prior assessment years. Without this charge, real estate taxes would have only increased 4.9% and total operating expenses would have only increased 3.8% over prior year.

THIRD QUARTER 2015
7
COMMUNITY OPERATIONS - TRAILING FIVE QUARTERS


(Amounts in thousands, except beds and per bed amounts)
Three Months Ended
 
Total / Weighted Average - Trailing Twelve Months
 
 
 
September 30, 2014
 
December 31, 2014
 
March 30, 2015
 
June 30, 2015
 
September 30, 2015
 
2015 Same Communities
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
$
40,064

 
$
48,669

 
$
48,077

 
$
44,640

 
$
42,155

 
$
183,541

 
Operating Expenses
 
22,453

 
18,714

 
19,987

 
18,594

 
23,332

 
80,627

 
Net Operating Income
 
$
17,611

 
$
29,955

 
$
28,090

 
$
26,046

 
$
18,823

 
$
102,914

 
Margin
 
44
%
 
62
%
 
58
%
 
58
%
 
45
%
 
56
%
 
Beds
 
69,237

 
69,237

 
69,237

 
69,237

 
69,237

 
276,948

 
Occupancy(1)
 
89.2
%
 
96.4
%
 
96.0
%
 
88.6
%
 
90.8
%
 
93.0
%
 
Net Apartment Rent per Occupied Bed
 
$
583

 
$
689

 
$
678

 
$
673

 
$
602

 
$
661

 
Other Income per Occupied Bed
 
66

 
40

 
45

 
54

 
68

 
52

 
Total Revenue per Occupied Bed
 
$
649

 
$
729

 
$
723

 
$
727

 
$
670

 
$
713

 
Operating Expense per Available Bed
 
$
324

 
$
270

 
$
289

 
$
269

 
$
336

 
$
291

 
 
 
 
 
 
 
 
 
 
 
 
 
 
2015 New Communities
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
$
4,929

 
$
11,823

 
$
11,939

 
$
8,727

 
$
12,203

 
$
44,692

 
Operating Expenses
 
2,180

 
3,012

 
3,786

 
3,907

 
4,745

 
15,450

 
Net Operating Income
 
$
2,749

 
$
8,811

 
$
8,153

 
$
4,820

 
$
7,458

 
$
29,242

 
Margin
 
56
%
 
75
%
 
68
%
 
55
%
 
61
%
 
65
%
 
Beds
 
8,256

 
13,674

 
13,674

 
13,824

 
19,756

 
60,928

 
Occupancy(1)
 
95.0
%
 
95.6
%
 
95.0
%
 
63.7
%
 
82.7
%
 
84.0
%
 
Net Apartment Rent per Occupied Bed
 
$
597

 
$
883

 
$
882

 
$
945

 
$
683

 
$
830

 
Other Income per Occupied Bed
 
31

 
22

 
37

 
47

 
64

 
43

 
Total Revenue per Occupied Bed
 
$
628

 
$
905

 
$
919

 
$
992

 
$
747

 
$
873

 
Operating Expense per Available Bed
 
$
264

 
$
220

 
$
277

 
$
283

 
$
240

 
$
254

 
 
 
 
 
 
 
 
 
 
 
 
 
 
2015 Sold Communities
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
$
2,664

 
$
1,153

 
$
—

 
$
—

 
$
—

 
$
1,153

 
Operating Expenses
 
2,287

 
860

 
—

 
—

 
—

 
860

 
Net Operating Income
 
$
377

 
$
293

 
$
—

 
$
—

 
$
—

 
$
293

 
Margin
 
14
%
 
25
%
 
—
%
 
—
%
 
—
%
 
25
%
 
Beds
 
6,383

 
1,628

 
—

 
—

 
—

 
1,628

 
Occupancy(1)
 
88.5
%
 
89.2
%
 
—
%
 
—
%
 
—
%
 
89.2
%
 
Net Apartment Rent per Occupied Bed
 
$
426

 
$
754

 
$
—

 
$
—

 
$
—

 
$
754

 
Other Income per Occupied Bed
 
46

 
40

 
—

 
—

 
—

 
40

 
Total Revenue per Occupied Bed
 
$
472

 
$
794

 
$
—

 
$
—

 
$
—

 
$
794

 
Operating Expense per Available Bed
 
$
362

 
$
529

 
$
—

 
$
—

 
$
—

 
$
529

 
 
 
 
 
 
 
 
 
 
 
 
 
 

THIRD QUARTER 2015
8
COMMUNITY OPERATIONS - TRAILING FIVE QUARTERS


 
 
 
 
 
 
 
 
 
 
 
 
 
 
(Amounts in thousands, except beds and per bed amounts)
Three Months Ended
 
Total / Weighted Average - Trailing Twelve Months
 
 
 
September 30, 2014
 
December 31, 2014
 
March 31, 2015
 
June 30, 2015
 
September 30, 2015
 
Other(2)
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
$
—

 
$
—

 
$
367

 
$
367

 
$
367

 
$
1,101

 
Operating Expenses
 
—

 
—

 
367

 
367

 
367

 
1,101

 
Net Operating Income
 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
Margin
 
—
%
 
—
%
 
—
%
 
—
%
 
—
%
 
—
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2015 Total Communities
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
$
47,657

 
$
61,645

 
$
60,383

 
$
53,734

 
$
54,725

 
$
230,487

 
Operating Expenses
 
26,920

 
22,586

 
24,140

 
22,868

 
28,444

 
98,038

 
Net Operating Income
 
$
20,737

 
$
39,059

 
$
36,243

 
$
30,866

 
$
26,281

 
$
132,449

 
Margin
 
44
%
 
63
%
 
60
%
 
57
%
 
48
%
 
57
%
 
Beds
 
83,876

 
84,539

 
82,911

 
83,061

 
88,993

 
339,504

 
Occupancy(1)
 
89.8
%
 
96.1
%
 
95.8
%
 
84.5
%
 
89.0
%
 
91.3
%
 
Net Apartment Rent per Occupied Bed
 
$
572

 
$
721

 
$
716

 
$
712

 
$
623

 
$
693

 
Other Income per Occupied Bed
 
61

 
37

 
44

 
53

 
67

 
50

 
Total Revenue per Occupied Bed
 
$
633

 
$
758

 
$
760

 
$
765

 
$
690

 
$
743

 
Operating Expense per Available Bed
 
$
321

 
$
268

 
$
291

 
$
275

 
$
320

 
$
289

 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) Represents the weighted average physical occupancy for the period presented.
(2) Represents additional same-community revenue and expenses incurred as a result of the Company changing its community assistant program at the end of 2014. The amounts are shown separately as there is no NOI impact and to clearly show the operating growth in revenue and expenses year over year.

THIRD QUARTER 2015
9
LEASING RESULTS SUMMARY

 
 
 
 
 
Opening Occupancy
 
 
 
 
 
 
Design Beds
 
% of NOI
 
2015
 
2014
 
Ahead/(Behind)
 
Opening Rate Growth
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Same-Communities - by Tier
 
 
 
 
 
 
 
 
 
 
 
 
     Prior Year Occupancy Below 90% (Tier 1)
2,906

 
5.2
%
 
86.9
%
 
81.6
%
 
5.3
 %
 
2.6
%
 
     Prior Year Occupancy 90% to 94.9% (Tier 2)
2,063

 
8.1
%
 
94.0
%
 
92.2
%
 
1.8
 %
 
2.1
%
 
     Prior Year Occupancy 95% to 97.9% (Tier 3)
5,772

 
16.7
%
 
97.9
%
 
97.4
%
 
0.5
 %
 
3.7
%
 
     Prior Year Occupancy 98% and Above (Tier 4)
15,996

 
70.0
%
 
98.8
%
 
99.7
%
 
(0.9
)%
 
3.6
%
 
Total Same-Communities
26,737

 
100.0
%
 
97.0
%
 
96.6
%
 
0.4
 %
 
3.4
%
 
Total New-Communities
3,557

 
 
 
95.5
%
 
 
 
 
 
 
 
Total Communities
30,294

 
 
 
96.8
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
NOTE: The same-community designation for leasing purposes is different than for financial statement purposes. A community is considered same-community for leasing when the Company has managed the leasing process for at least two leasing cycles, including the 2015/2016 leasing cycle.
 

THIRD QUARTER 2015
10
SAME-COMMUNITY LEASING BY REGION AND DISTANCE

 
 
 
 
 
 
Opening Occupancy
 
 
 
 
 
Design Beds
 
% of NOI
 
 
2015
 
2014
 
Ahead/(Behind)
 
Opening Rate Growth
 
 
 
 
 
 
 
 
 
 
 
 
 
Same-Communities - by Region (1)
 
 
 
 
 
 
 
 
 
 
 
 
Mid-Atlantic
5,811

 
26.1
%
 
 
95.8
%
 
95.0
%
 
0.8
 %
 
3.6
%
Midwest
2,636

 
7.0
%
 
 
90.2
%
 
93.6
%
 
(3.4
)%
 
4.2
%
North
3,206

 
10.6
%
 
 
98.1
%
 
99.3
%
 
(1.2
)%
 
2.1
%
South Central
7,076

 
31.3
%
 
 
98.7
%
 
98.8
%
 
(0.1
)%
 
3.3
%
Southeast
5,681

 
15.8
%
 
 
97.9
%
 
96.1
%
 
1.8
 %
 
2.3
%
West
2,327

 
9.2
%
 
 
98.5
%
 
95.4
%
 
3.1
 %
 
4.1
%
Total Same-Communities
26,737

 
100.0
%
 
 
97.0
%
 
96.6
%
 
0.4
 %
 
3.4
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Same-Communities - by Distance from Campus
 
 
 
 
 
 
 
 
 
 
 
 
0-0.2 miles
16,292

 
71.3
%
 
 
98.8
%
 
97.9
%
 
0.9
 %
 
3.4
%
0.21-0.49 miles
2,144

 
6.3
%
 
 
96.4
%
 
97.1
%
 
(0.7
)%
 
3.3
%
0.5-0.99 miles
1,004

 
3.2
%
 
 
90.1
%
 
99.1
%
 
(9.0
)%
 
1.8
%
1.0-1.99 miles
5,437

 
14.8
%
 
 
93.8
%
 
92.0
%
 
1.8
 %
 
3.8
%
2.0 & > miles
1,860

 
4.4
%
 
 
94.8
%
 
97.9
%
 
(3.1
)%
 
2.8
%
Total Same-Communities
26,737

 
100.0
%
 
 
97.0
%
 
96.6
%
 
0.4
 %
 
3.4
%
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) See definition of regions on page 27.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 


THIRD QUARTER 2015
11
TOP EdR MARKETS AND STATES BY REVENUE

*The data above is based on revenue for the twelve months ended September 30, 2015 and excludes properties that were sold during the period.
(1) All revenue at the University of Kentucky is from ONE PlanSM assets.

THIRD QUARTER 2015
12
TOP EdR MARKETS AND STATES BY REVENUE



*The data above is based on revenue for the twelve months ended September 30, 2015 and excludes properties that were sold during the period.


THIRD QUARTER 2015
13
NEW SUPPLY AND ENROLLMENT - EdR MARKETS


New supply growth expected to slow 20% from 2015 to 2016

EdR Market and Revenue Growth
*Enrollment projection represents the 3-year enrollment CAGR through 2014 for our markets.

THIRD QUARTER 2015
14
NEW SUPPLY AND ENROLLMENT - EdR MARKETS

 
 
 
 
 
 
 
 
 
Owned Community Projected 2016 New Supply and Demand Information by Region
 
 
 
 
 
 
 
 
 
 
 
Region (4)
Owned Beds (3)
Percentage of Owned Beds
EdR NOI % (1)
Enrollment Growth 3 Year CAGR - Universities Served
2016 New Supply %
Variance
 
West
3,544
11%
12%
1.5%
0.5%
1.0%
 
Mid Atlantic
6,824
21%
25%
1.0%
1.5%
(0.5)%
 
North
3,206
10%
8%
0.2%
1.1%
(0.9)%
 
South Central
10,983
33%
37%
2.2%
2.9%
(0.7)%
 
Southeast
5,681
17%
12%
0.9%
0.7%
0.2%
 
Midwest
2,636
8%
6%
1.6%
1.5%
0.1%
 
     Total
32,874
100%
100%
1.5%
1.8%
(0.3)%
 
 
 
 
 
 
 
 
 
 
Region (4)
Anticipated 2016 Enrollment Growth (2)
2016 Supply Growth
Variance
 
 
 
 
 
West
2,900
761
2,139
 
 
 
 
 
Mid Atlantic
2,081
2,300
(219)
 
 
 
 
 
North
1,124
1,836
(712)
 
 
 
 
 
South Central
3,288
5,976
(2,688)
 
 
 
 
 
Southeast
1,269
1,791
(522)
 
 
 
 
 
Midwest
1,548
1,482
66
 
 
 
 
 
     Total
12,210
14,146
(1,936)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
NOTE: Schedule represents all markets served by EdR communities and includes 2015 completed deliveries and acquisitions and all announced 2016 developments. Data was obtained from the National Center for Education Statistics, Axiometrics and local market data.
 
 
 
(1) NOI is based on current 2015 forecast net operating income with proforma adjustments for 2015 and 2016 developments and acquisitions that have been operating for less than 12 months.
 
(2) Extrapolated from 2014 enrollment statistics from University Common Data Sets using the previous 3-year enrollment growth percentage.
 
(3) Total Owned Beds reported herein include Total Communities design beds on page 25 of 30,761 plus 2,113 beds at our 2016 deliveries at the University of Kentucky (1,141 beds), The Retreat at Blacksburg (622 beds) and the second phase at the Retreat at Oxford (350 beds) (also see page 18).
 
(4) See definition of regions on page 27.
 

THIRD QUARTER 2015
15
NEW SUPPLY AND ENROLLMENT - EdR MARKETS

 
 
 
 
 
 
 
 
 
 
 
Projected 2016 New Supply Sorted by Percentage Increase
 
 
 
 
 
 
 
 
New Supply Growth
University Markets
EdR Bed Count
Pro Forma
EdR NOI %(1)
0%
13
34%
15,453
47%
47%
0.1% to 1.0%
8
21%
4,245
13%
12%
1.0% - 3.0%
10
26%
7,449
23%
21%
3.0% - 5.0%
4
11%
2,559
8%
11%
> 5.0%
3
8%
3,168
9%
9%
     Total
38
100%
32,874
100%
100%
 
 
 
 
 
 
 
 
 
 
 
 
University Markets with > 5% Increase in 2016 New Supply
 
 
 
 
 
 
 
 
 
University
New Supply Increase
Pro Forma EdR NOI %
 
 
 
University of Mississippi
8.2%
4.3%
 
 
 
University of Tennessee
6.9%
2.0%
 
 
 
University of Louisville
5.5%
2.2%
 
 
 
 
 
8.5%
 
 
 
 
 
 
 
 
 
NOTE: Schedule represents all markets served by EdR communities and includes 2015 completed deliveries and acquisitions and all announced 2016 developments. Data was obtained from the National Center for Education Statistics, Axiometrics and local market data.
(1) NOI is based on current 2015 forecast net operating income with proforma adjustments for 2015 and 2016 developments and acquisitions that have been operating for less than 12 months.


THIRD QUARTER 2015
16
OWNED DEVELOPMENT SUMMARY - RECENT DELIVERIES


(Amounts in thousands except bed counts)
 
 
 
 
 
 
 
 
 
 
 
August 2015 Delivered Communities
 
 
 
 
 
Project
Project Type
Bed Count
Total Project Development Cost
EdR's Ownership Percentage
EdR's Share of Development Cost
 
University of Kentucky - Woodland Glen III, IV & V
ONE Plan (1)
1,610

$
101,172

100%
$
101,172

 
University of Georgia - Georgia Heights
Joint Venture (2)
292

55,615

50%
27,808

 
University of Connecticut - The Oaks on the Square Ph IV
Wholly Owned
391

45,000

100%
45,000

 
University of Louisville - The Retreat at Louisville
Joint Venture
656

45,000

75%
33,750

 
            Total - August 2015 Delivered Communities
 
2,949

$
246,787

 
$
207,730

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) The On-Campus Equity Plan, or The ONE Plan SM, is our equity program for universities, which allows universities to use EdR's equity and financial stability to develop and revitalize campus housing while preserving their credit capacity for other campus projects. The ONE Plan SM offers one service provider and one equity source to universities seeking to modernize on-campus housing to meet the needs of today's students.
 
(2) This project is not majority owned. As such, it will not be consolidated and we will recognize our portion of profits through equity in earnings on the income statement.


THIRD QUARTER 2015
17
OWNED DEVELOPMENT SUMMARY

(Amounts in thousands except bed counts)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Active Projects
Project Type
Bed Count
Estimated Start Date
Anticipated Completion Date
Total Project Development Cost
 
EdR's Ownership Percentage
EdR's Share of Development Cost
 
EdR's Share of Development Cost to be Funded
 
University of Kentucky - Limestone Park I & II(1)
ONE Plan (2)
1,141

In progress
Summer 2016
$
83,911

 
100
%
$
83,911

 
$
49,282

 
University of Mississippi - The Retreat - Phase II
Wholly Owned
350

In progress
Summer 2016
26,161

 
100
%
26,161

 
19,112

 
Virginia Tech - Retreat at Blacksburg - Phase I
Joint Venture
622

In progress
Summer 2016
48,325

 
75
%
36,244

 
24,725

 
            Total - 2016 Deliveries
 
2,113

 
 
$
158,397

 
 
$
146,316

 
$
93,119

 
 
 
 
 
 
 
 
 
 
 
 
 
University of Kentucky - University Flats
ONE Plan (2)
771

In progress
Summer 2017
$
74,038

 
100
%
$
74,038

 
$
69,989

 
Virginia Tech - Retreat at Blacksburg - Phase II
Joint Venture
207

Summer 2016
Summer 2017
16,108

 
75
%
12,081

 
12,081

 
Boise State University
ONE Plan (2)
656

Fall 2015
Summer 2017
$
39,763

 
100
%
$
39,763

 
$
39,763

 
            Total - 2017 Deliveries
 
1,634

 
 
$
129,909

 
 
$
125,882

 
$
121,833

 
 
 
 
 
 
 
 
 
 
 
 
 
Total Active Projects
 
3,747

 
 
$
288,306

 
 
$
272,198

 
$
214,952

 
 
 
 
 
 
 
 
 
 
 
 
 
Recently Awarded - 2017 Deliveries
Project Type
Bed Count
Total Project Development Cost
 
 
 
 
 
 
 
 
University of Kentucky - Honors College
ONE Plan (2)
350

$
27,000

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
NOTE: The initiation and completion of an awarded project that has not begun construction is contingent upon execution of transactional documents, including such items as development agreements, construction agreements and ground leases. EdR will not be proceeding with the awarded ONE Plan development at Arkansas State University as the revised requirements of the university and a new selected site made the project infeasible.

 
(1) This project, once complete, will consist of multiple communities.
 
(2) The On-Campus Equity Plan, or The ONE PlanSM, is our equity program for universities, which allows universities to use EdR's equity and financial stability to develop and revitalize campus housing while preserving their credit capacity for other campus projects. The ONE PlanSM offers one service provider and one equity source to universities seeking to modernize on-campus housing to meet the needs of today's students.
 


THIRD QUARTER 2015
18
DEVELOPMENT FUNDING





Note: Announced developments of $299 million and amount already funded of $57 million are as of September 30, 2015.
(1) Assumed 35% debt to fund remaining development spend.
(2) 2014 dispositions had an average cap rate of 6.2%.


THIRD QUARTER 2015
19
THIRD-PARTY DEVELOPMENT SUMMARY


(Amounts in thousands except bed counts)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
THIRD-PARTY PROJECTS
 
 
 
 
 
 
 
 
Active Projects
Bed Count
Estimated Start Date
Anticipated Completion Date
Project Development Cost
Total Project Fees
Fees Earned Prior Year (1)
Fees Earned Nine Months Ended September 30, 2015 (1)
Remaining Fees to Earn
University of Cal. Berkeley - Bowles Hall
186

Summer 2015
Summer 2016
$
35,947

$
1,768

$
—

$
264

$
1,504

Clarion University of Pennsylvania
728

Spring 2014
(2)
55,104

2,092

931

1,005

156

East Stroudsburg University - Pennsylvania Ph II
488

Spring 2016
Summer 2017
TBD

TBD

—

—

TBD

Texas A&M - Commerce
480

Summer 2016
Summer 2017
TBD

TBD

—

—

TBD

     Total
1,882



$
91,051

$
3,860

$
931

$
1,269

$
1,660

 
NOTE: The initiation and completion of an awarded project that has not begun construction is contingent upon execution of transactional documents, including such items as development agreements and ground leases, and obtaining financing.
 
 
 
 
 
 
 
 
 
(1) Amount may not tie to third-party development services revenue on the statement of operations as this schedule only includes fees earned on projects that are in progress or recently completed.
(2) The first phase of the project at Clarion University of Pennsylvania for collegiate housing delivered in August 2015, the second phase of the project for collegiate housing is scheduled to deliver in December 2015 and a third phase of the project for other capital improvements is scheduled to deliver in the summer of 2016.



THIRD QUARTER 2015
20
CAPITAL STRUCTURE

 
 
 
 
 
 
 
 
 
 
as of September 30, 2015
 
 
 
 
 
Principal Outstanding
Weighted Average Interest Rate
Average Term to Maturity (in years)
 
(Amounts in thousands)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total Debt to Gross Assets
 
 
 
 
Fixed Rate - Mortgage Debt
$
138,414

5.5
%
2.4

 
Debt(1)
$
890,727

 
 
 
Variable Rate - Mortgage Debt
33,825

2.4
%
0.8

 
Gross Assets(2)
2,233,983

 
 
 
Variable Rate - Construction Debt
59,988

2.2
%
1.9

 
Debt to Gross Assets
39.9
%
 
 
 
Fixed Rate - 5 Yr. Unsecured Term Loan (6)
65,000

2.9
%
3.3

 
 
 
 
 
 
Fixed Rate - 7 Yr. Unsecured Term Loan (6)
122,500

3.9
%
5.3

 
Net Debt to Enterprise Value
 
 
 
 
Fixed Rate - Unsecured Senior Notes
250,000

4.6
%
9.2

 
     Net Debt(1)
$
876,558

 
 
 
Variable Rate - Unsecured Revolving Credit Facility
221,000

1.5
%
3.1

 
     Market Equity (3)
1,604,022

 
 
 
Debt(1) / Weighted Average
$
890,727

3.5
%
4.9

 
Enterprise Value
$
2,480,580

 
 
 
Less: Cash
14,169

 
 
 
 
 
 
 
 
Net Debt
$
876,558

 
 
 
Net Debt to Enterprise Value
35.3
%
 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest Coverage (TTM)(4)
4.8x
 

 
 
 
 
 
 
Net Debt to EBITDA - Adjusted (TTM)(5)
6.3x
 

 
 

 
 
 
Variable Rate Debt to Total Debt
35.3%
 

 
 
 
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 
 
 
 
 
(1) Excludes unamortized debt premium of $0.9 million.
(2) Excludes accumulated depreciation of $257.6 million.
(3) Market equity includes 48,362,091 shares of the Company's common stock and 318,403 units outstanding, which are convertible into common shares, and is calculated using $32.95 per share, the closing price of the Company's common stock on September 30, 2015.
(4) Equals Adjusted EBITDA of $112.3 million divided by interest expense of $23.2 million. See page 24 for reconciliation to Adjusted EBITDA.
(5)  Net Debt to EBITDA - Adjusted is calculated to normalize the impact of non-income producing construction debt. In the calculation, Net Debt is total debt (excluding the unamortized debt premium) less cash and excludes non income-producing debt related to assets under development at time of calculation. EBITDA is Proforma Adjusted EBITDA, which includes proforma adjustments to reflect all acquisitions, development deliveries and dispositions as if such had occurred at the beginning of the 12 month period being presented.
(6) The Trust entered into interest rate swaps to effectively fix the interest rate on the term loans. The weighted average interest rates reflect the swapped (fixed) rate plus the current margin.





THIRD QUARTER 2015
21
CAPITAL STRUCTURE


Weighted Average Interest Rate of Debt Maturing Each Year (2)
 
 
2016
 
2017
 
2018
 
2019
 
2020
 
2021
 
2022
 
2023
 
2024
Fixed Rate Debt
 
4.2%
 
5.5%
 
—%
 
4.3%
 
5.7%
 
3.9%
 
—%
 
—%
 
4.6%
Variable Rate Debt
 
2.4%
 
2.2%
 
1.5%
 
2.2%
 
—%
 
—%
 
—%
 
—%
 
—%
Total Debt
 
3.1%
 
3.5%
 
1.5%
 
4.3%
 
5.7%
 
3.9%
 
—%
 
—%
 
4.6%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) The unsecured revolving credit facility has an initial maturity of November 19, 2018 and has a one-year extension option that may be exercised if certain conditions are met.
(2) The Trust entered into interest rate swaps to effectively fix the interest rate on the term loans. The weighted average interest rates reflect the swapped (fixed) rate plus the current margin.

THIRD QUARTER 2015
22
 
UNSECURED SENIOR NOTE COVENANTS

as of September 30, 2015
 
 
 
 
(Amounts in thousands)
 
 
 
 
 
 
 
 
 
Unsecured Senior Note Covenants(1)
Requirement
 
Current Ratio
 
Total Debt to Total Asset Value
≤ 60%
 
40.1%
 
Secured Debt to Total Asset Value
≤ 40%
 
10.5%
 
Unencumbered Asset Value to Unsecured Debt
> 150%
 
270.1%
 
Interest Coverage
> 1.5x
 
3.64x
 
 
 
 
 
 
 
 
 
 
 
Calculation of Interest Coverage Ratio:
 
 
 
 
Adjusted Pro Forma EBITDA - TTM:
 
 
 
 
EdR Adjusted EBITDA(2)
$
112,289

 
 
 
Pro forma Adjustments - acquisitions & dispositions (1)
2,964

 
 
 
Total Adjusted Pro Forma EBITDA - TTM
$
115,253


 
 
 
 
 
 
 
Pro Forma Interest Expense - TTM:
 
 
 
 
Interest expense
$
23,195

 
 
 
Add back: Capitalized interest
5,932

 
 
 
Pro forma adjustments(1)
2,563

 
 
 
Pro forma interest expense - TTM
$
31,690


 
 
 
 
 
 
 
Interest Coverage
3.64x

 
 
 
 
 
 
 
 
(1) Computed in accordance with the First Supplemental Indenture filed November 24, 2014 with the SEC. 
(2) See page 24 for a reconciliation to EdR Adjusted EBITDA.


THIRD QUARTER 2015
23
RECONCILIATION OF NON-GAAP MEASURES


(Amounts in thousands)
 
Nine Months
 
Plus: Year
 
Less: Nine
 
Trailing Twelve
 
 
 
Ended
 
Ended
 
Months Ended
 
Months Ended
 
Adjusted EBITDA and Pro Forma Adjusted EBITDA:
 
September 30, 2015
 
December 31, 2014
 
September 30, 2014
 
September 30, 2015
 
Net income attributable to common shareholders
 
$
5,138

 
$
47,055

 
$
24,658

 
$
27,535

 
Straight line adjustment for ground leases
 
3,596

 
4,835

 
3,634

 
4,797

 
Acquisition costs
 
293

 
1,058

 
1,058

 
293

 
Depreciation and amortization
 
49,605

 
58,974

 
42,928

 
65,651

 
Loss on impairment of collegiate housing assets
 
—

 
12,734

 
12,734

 
—

 
Gain on sale of collegiate housing assets
 
—

 
(33,231
)
 
(19,322
)
 
(13,909
)
 
Gain on insurance settlement
 
—

 
(8,133
)
 
(8,133
)
 
—

 
Interest expense
 
17,615

 
20,656

 
15,076

 
23,195

 
Amortization of deferred financing costs
 
1,527

 
2,156

 
1,533

 
2,150

 
Interest income
 
(144
)
 
(190
)
 
(152
)
 
(182
)
 
Interest on loan to participating development
 
—

 
(6,486
)
 
(6,486
)
 
—

 
Loss on extinguishment of debt
 
—

 
3,543

 
892

 
2,651

 
Income tax expense (benefit)
 
325

 
261

 
598

 
(12
)
 
Noncontrolling interests
 
(86
)
 
599

 
393

 
120

 
Adjusted EBITDA
 
$
77,869

 
$
103,831

 
$
69,411

 
$
112,289

 
Annualize acquisitions, developments and dispositions(1)
 
—

 
—

 
—

 
15,626

 
Pro Forma Adjusted EBITDA
 
$
77,869

 
$
103,831

 
$
69,411

 
$
127,915

 
 
 
 
 
 
 
 
 
 
 
(1) Pro forma adjustment to reflect all acquisitions, development deliveries and dispositions as if such transactions had occurred on the first day of the period presented.

THIRD QUARTER 2015
24
COMMUNITY LISTING - OWNED

Name
 
Primary University Served
 
 Acquisition/Development Date
 
# of Beds
 
Name
 
Primary University Served
 
Acquisition/Development Date
 
# of Beds
Players Club
 
Florida State University
 
Jan '05
 
336

 
The Centre at Overton Park
 
Texas Tech University
 
Dec '12
 
400

The Commons
 
Florida State University
 
Jan '05
 
732

 
The Oaks on the Square
 
University of Connecticut
 
Aug '12, Aug '13
 
503

University Towers
 
North Carolina State University
 
Jan '05
 
889

 
3949
 
Saint Louis University
 
Aug '13
 
256

The Reserve on Perkins
 
Oklahoma State University
 
Jan '05
 
732

 
Central Hall I (ONE Plan)
 
University of Kentucky
 
Aug '13
 
301

The Pointe
 
Pennsylvania State University
 
Jan '05
 
984

 
Central Hall II (ONE Plan)
 
University of Kentucky
 
Aug '13
 
300

The Lofts
 
University of Central Florida
 
Jan '05
 
730

 
2400 Nueces (ONE Plan)
 
University of Texas at Austin
 
Aug '13
 
655

The Reserve at Athens
 
University of Georgia
 
Jan '05
 
612

 
Roosevelt Point
 
Arizona State University- Downtown Phoenix
 
Aug '13
 
609

The Reserve at Columbia

University of Missouri

Jan '05

676

 
The Retreat at Oxford
 
University of Mississippi
 
Aug '13
 
668

Commons at Knoxville

University of Tennessee

Jan '05

708

 
The Retreat at State College
 
Pennsylvania State University
 
Sept '13
 
587

Campus Creek

University of Mississippi

Feb '05

636

 
The Cottages on Lindberg
 
Purdue University
 
Sept '13
 
745

Campus Lodge

University of Florida

Jun '05

1,115

 
The Varsity
 
University of Michigan
 
Dec '13
 
416

Cape Trails

Southeast Missouri State University

Jan '06

360

 
 
 
Total Same-Communities(2)
 
 
 
23,079

Carrollton Crossing

University of West Georgia

Jan '06

336

 
 
 
 
 
 
 

River Pointe

University of West Georgia

Jan '06

504

 
The Lotus(1)
 
University of Colorado, Boulder
 
Nov '11, Aug '14
 
235

The Reserve at Saluki Pointe

Southern Illinois University

Aug '08, Aug '09

768

 
605 West(1)
 
Duke University
 
Aug '14
 
384

University Village on Colvin (ONE Plan)

Syracuse University

Aug '09

432

 
109 Tower(1)
 
Florida International University
 
Aug '14
 
542

GrandMarc at The Corner

University of Virginia

Oct '10

641

 
The Oaks on the Square- Ph III(1)
 
University of Connecticut
 
Aug '14
 
116

Wertland Square

University of Virginia

Mar '11

152

 
Champions Court I (ONE Plan)(1)
 
University of Kentucky
 
Aug '14
 
740

Jefferson Commons

University of Virginia

Mar '11

82

 
Champions Court II (ONE Plan)(1)
 
University of Kentucky
 
Aug '14
 
427

The Berk on College

University of California, Berkeley

May '11

122

 
Haggin Hall (ONE Plan)(1)
 
University of Kentucky
 
Aug '14
 
396

The Berk on Arch

University of California, Berkeley

May '11

43

 
Woodland Glen I (ONE Plan)(1)
 
University of Kentucky
 
Aug '14
 
409

University Village Towers

University of California, Riverside

Sept '11

554

 
Woodland Glen II (ONE Plan)(1)
 
University of Kentucky
 
Aug '14
 
409

Irish Row

University of Notre Dame

Nov '11

326

 
The District on Apache(2)
 
Arizona State University- Tempe
 
Sept '14
 
900

GrandMarc at Westberry Place (ONE Plan)

Texas Christian University

Dec '11

562

 
Commons on Bridge (2)(3)
 
University of Tennessee
 
June '15
 
150

The Reserve on Stinson

University of Oklahoma

Jan '12

612

 
Oaks on the Square - Ph IV(2)
 
University of Connecticut
 
Aug '15
 
391

Campus West (ONE Plan)

Syracuse University

Aug '12

313

 
The Retreat at Louisville(2)
 
University of Louisville
 
Aug '15
 
656

East Edge

University of Alabama

Aug '12

774

 
Woodland Glen III (ONE Plan)(2)
 
University of Kentucky
 
Aug '15
 
782

The Province

East Carolina University

Sept '12

728

 
Woodland Glen IV (ONE Plan)(2)
 
University of Kentucky
 
Aug '15
 
578

The District on 5th

University of Arizona

Oct '12

764

 
Woodland Glen V (ONE Plan)(2)
 
University of Kentucky
 
Aug '15
 
250

Campus Village
 
Michigan State University
 
Oct '12
 
355

 
The Province Boulder(3)
 
University of Colorado, Boulder
 
Sept '15
 
317

The Province
 
Kent State University
 
Nov '12
 
596

 
 
 
Total New-Communities
 
 
 
7,682

The Suites at Overton Park
 
Texas Tech University
 
Dec '12
 
465

 
 
 
Total Owned-Communities
 
 
 
30,761

 
 
 
 
 
 
 
 
 
 
 
 
 
 

(1) The same-community designation for leasing purposes is different than for financial reporting purposes. These communities are considered same-community for 2015/2016 leasing purposes, as the Company managed the leasing process for both the 2014/2015 and 2015/2016 lease cycles. Total same-community beds for leasing purposes is 26,737.
(2) This property is considered new for purposes of leasing, as we did not manage the leasing process for the 2014/2015 lease year.
(3) The Company acquired this property after leasing for the 2015/2016 lease year was complete. Such property is not included in our opening leasing results.

THIRD QUARTER 2015
25
INVESTOR RELATIONS

Executive Management
 
 
 
 
Randy Churchey
Chief Executive Officer
 
 
 
Tom Trubiana
President
 
 
 
Bill Brewer
Chief Financial Officer
 
 
 
Christine Richards
Chief Operating Officer
 
 
 
Lindsey Mackie
Chief Accounting Officer
 
 
 
J. Drew Koester
Senior Vice President - Capital Markets and Investor Relations
 
 
 
 
 
 
Corporate Headquarters
 
 
 
 
EdR
 
 
 
 
999 South Shady Grove Road, Suite 600
 
 
 
 
Memphis, TN 38120
 
 
 
 
(901) 259-2500
 
 
 
 
 
 
 
 
Covering Analysts
 
 
 
 
Firm
Analyst
Contact #
Email
 
Bank of America - Merrill
Jana Galan
(646) 855-3081
jana.galan@baml.com
 
CANACCORD|Genuity
Ryan Meliker
(212) 389-8094
rmeliker@canaccordgenuity.com
 
Green Street Advisors
Dave Bragg
(949) 706-8142
dbragg@greenstreetadvisors.com
 
Goldman Sachs
Andrew Rosivach
(212) 902-2796
andrew.rosivach@gs.com
 
Hilliard Lyons
Carol Kemple
(502) 588-1839
ckemple@hilliard.com
 
J.P. Morgan Securities Inc.
Anthony Paolone
(212) 622-6682
anthony.paolone@jpmorgan.com
 
JMP Securities
Aaron Hecht
(415) 835-3963
ahecht@jmpsecurities.com
 
KeyBanc Capital Markets
Jordan Sadler
(917) 368-2280
jsadler@keybanccm.com
 
RBC Capital Market
Wes Golladay
(440) 715-2650
wes.golladay@rbccm.com
 
Robert W Baird & Co.
Drew Babin
(215) 553-7816
dbabin@rwbaird.com
 
Sandler O'Neill + Partners, L.P.
Alex Goldfarb
(212) 466-7937
agoldfarb@sandleroneill.com
 
Stifel Nicolaus & Company Inc.
Rod Petrik
(443) 224-1306
rpetrik@stifel.com
 
UBS Securities
Ross Nussbaum
(212) 713-2484
ross.nussbaum@ubs.com
 
Wunderlich Securities
Craig Kucera
(540) 277-3366
ckucera@wundernet.com


THIRD QUARTER 2015
26
DEFINITIONS

 
 
Design beds
Represents the sum of the monthly design beds in the portfolio during the period.
 
 
FFO
Funds from operations as defined by the National Association of Real Estate Investment Trusts.
 
 
GAAP
U.S. generally accepted accounting principles.
 
 
Net apartment rent per occupied bed (NarPOB)
Represents GAAP net apartment rent for the respective period divided by the sum of occupied beds in the portfolio for each month included in the period reported.
 
 
Net debt to EBITDA - adjusted
Net debt to EBITDA - adjusted is calculated to normalize the impact of non-producing construction debt. In the calculation, net debt is total debt less cash and excludes non-producing debt related to assets under development at time of calculation. EBITDA is Pro Forma Adjusted EBITDA, which includes proforma adjustments to reflect all acquisitions, dispositions and development assets that are open as if such had occurred at the beginning of the 12 month period being presented.
 
 
Operating expense per bed
Represents community-level operating expenses excluding management fees, depreciation and amortization.
 
 
Other income per available bed
Represents other GAAP-based income for the respective period divided by the sum of the design beds in the portfolio for each of the included months. Other income includes service/application fees, late fees, termination fees, parking fees, transfer fees, damage recovery, utility recovery, and other misc.
 
 
Physical occupancy
Represents a weighted average of the month end occupancies for each month included in the period reported.
 
 
Regional Definitions
Regions are defined as follows: Mid-Atlantic: North Carolina, Pennsylvania, Connecticut, New York, Virginia; Midwest: Oklahoma, Missouri; North: Michigan, Ohio, Indiana, Illinois; South Central: Texas, Tennessee, Mississippi, Kentucky; Southeast: Florida, Alabama, Georgia; West: Arizona, California, Colorado.
 
 
Revenue per occupied bed (RevPOB)
Represents total revenue (net apartment rent plus other income) for the respective period divided by the sum of occupied beds in the portfolio for each month included in the period reported.
 
 
Same community
Includes communities that have been owned for more than a year as of the beginning of the current fiscal year.


THIRD QUARTER 2015
27
SAFE HARBOR STATEMENT



Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995


Statements about the Company’s business that are not historical facts are “forward-looking statements,” which relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions. 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 are based on current expectations. You should not rely on our forward-looking statements because the matters that they describe are subject to known and unknown risks and uncertainties that could cause the Company’s business, financial condition, liquidity, results of operations, Core FFO, FFO and prospects to differ materially from those expressed or implied by such statements. Such risks are set forth under the captions “Risk Factors,” “Forward-Looking Statements” and "Management’s Discussion and Analysis of Financial Condition and Results of Operations” (or similar captions) in our most recent Annual Report on Form 10-K and our quarterly reports on Form 10-Q, and as described in our other filings with the Securities and Exchange Commission. Forward-looking statements speak only as of the date on which they are made, and, except as otherwise may be required by law, the Company undertakes no obligation to update publicly or revise any guidance or other forward-looking statement, whether as a result of new information, future developments, or otherwise except as required by law.


THIRD QUARTER 2015
28

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