Attached files
| file | filename |
|---|---|
| EX-99.1 - EXHIBIT 99.1 - AMERICAN CAMPUS COMMUNITIES INC | ex991-q42016earningsrelease.htm |
| 8-K - 8-K - AMERICAN CAMPUS COMMUNITIES INC | form8-kq42016earningsrelea.htm |
Supplemental
Analyst Package
4Q 2016
February 21, 2017
Table of Contents
Financial Highlights 1
Consolidated Balance Sheets 2
Consolidated Statements of Comprehensive Income 3
Consolidated Statements of Funds from Operations 4
Wholly-Owned Properties Results of Operations 5
Same Store Wholly-Owned Properties Operating Expenses 6
Seasonality of Operations 7
2017 / 2018 Leasing Status 9
Investment Update 10
Owned Development Update 11
Third-Party Development Update 12
Management Services Update 13
Capital Structure 14
Interest Coverage 15
Capital Allocation – Long Term Funding Plan 16
2017 Outlook - Summary 17
2017 Outlook – Detail 18
Detail of Property Groupings 19
Definitions 20
Investor Information 22
Financial Highlights
($ in thousands, except share and per share data)
1
Operating Data Three Months Ended December 31, Year Ended December 31,
2016 2015 $ Change % Change 2016 2015 $ Change % Change
Total revenues $ 203,972 $ 202,198 $ 1,774 0.9 % $ 786,361 $ 753,381 $ 32,980 4.4 %
Operating income 51,724 53,725 (2,001 ) (3.7 )% 173,143 156,904 16,239 10.3 %
Net income attributable to ACC1 25,392 28,359 (2,967 ) (10.5 )% 99,061 115,991 (16,930 ) (14.6 )%
Net income per share - basic 0.19 0.25 0.76 1.03
Net income per share - diluted 0.19 0.25 0.75 1.02
Funds From Operations ("FFO")2 77,955 82,626 (4,671 ) (5.7 )% 292,597 271,381 21,216 7.8 %
FFO per share - diluted2 0.58 0.72 (0.14 ) (19.4 )% 2.23 2.38 (0.15 ) (6.3 )%
Funds From Operations - Modified ("FFOM")2 86,936 79,113 7,823 9.9 % 297,694 269,259 28,435 10.6 %
FFOM per share - diluted2 0.65 0.69 (0.04 ) (5.8 )% 2.27 2.36 (0.09 ) (3.8 )%
Market Capitalization and Unsecured Notes Covenants3 December 31, 2016 December 31, 2015
Debt to total market capitalization 24.1% 38.2%
Net debt to EBITDA4 5.4x 7.4x
Unencumbered asset value to total asset value 81.0% 71.3%
Total debt to total asset value 31.3% 42.8%
Secured debt to total asset value 9.8% 15.4%
Unencumbered asset value to unsecured debt 378.2% 260.5%
Interest coverage4 4.5x 3.7x
1. Excluding net gains from dispositions of real estate, impairment charges and losses from the early extinguishment of debt, net income attributable to ACC for the three months ended December 31,
2016 and 2015 would have been $39.3 million and $28.4 million, respectively. Excluding net gains from dispositions of real estate, impairment charges and losses from the early extinguishment of
debt, net income attributable to ACC for the years ended December 31, 2016 and 2015 would have been $95.6 million and $65.1 million, respectively.
2. Refer to page 4 for a reconciliation to net income, the most directly comparable GAAP measure.
3. Refer to the definitions outlined on pages 20 and 21 for detailed definitions of terms appearing on this page.
4. Refer to calculations on page 15, including a reconciliation to net income and interest expense, the most directly comparable GAAP measures.
Consolidated Balance Sheets
($ in thousands)
2
December 31, 2016 December 31, 2015
(unaudited)
Assets
Investments in real estate:
Wholly-owned properties, net $ 5,427,014 $ 5,522,271
Wholly-owned properties held for sale 25,350 55,354
On-campus participating properties, net 85,797 90,129
Investments in real estate, net 5,538,161 5,667,754
Cash and cash equivalents 22,140 16,659
Restricted cash 24,817 33,675
Student contracts receivable, net 8,428 18,475
Other assets1 2 272,367 269,685
Total assets $ 5,865,913 $ 6,006,248
Liabilities and equity
Liabilities:
Secured mortgage, construction and bond debt2 $ 688,195 $ 1,094,962
Unsecured notes2 1,188,737 1,186,700
Unsecured term loans2 149,065 597,719
Unsecured revolving credit facility 99,300 68,900
Accounts payable and accrued expenses 76,614 71,988
Other liabilities3 158,437 144,811
Total liabilities 2,360,348 3,165,080
Redeemable noncontrolling interests 55,078 59,511
Equity:
American Campus Communities, Inc. and
Subsidiaries stockholders' equity:
Common stock 1,322 1,124
Additional paid in capital 4,118,842 3,325,806
Treasury stock (975 ) (403 )
Accumulated earnings and dividends (670,137 ) (550,501 )
Accumulated other comprehensive loss (4,067 ) (5,830 )
Total American Campus Communities, Inc. and
3,444,985 2,770,196 Subsidiaries stockholders' equity
Noncontrolling interests - partially owned properties 5,502 11,461
Total equity 3,450,487 2,781,657
Total liabilities and equity $ 5,865,913 $ 6,006,248
1. As of December 31, 2016, other assets include approximately $2.8 million related to net deferred financing costs on our revolving credit facility and the net value of in-place leases.
2. Beginning in 2016, deferred financing costs associated with secured mortgage, construction and bond debt, unsecured notes, and unsecured term loans are subject to new accounting guidance and are
presented as a direct reduction to the carrying value of the debt. Prior period amounts have been reclassified to conform to the current period presentation.
3. As of December 31, 2016, other liabilities include approximately $44.4 million in deferred revenue and fee income.
Consolidated Statements of Comprehensive Income
($ in thousands, except share and per share data)
3
Three Months Ended December 31, Year Ended December 31,
2016 2015 $ Change 2016 2015 $ Change
Revenues (unaudited) (unaudited)
Wholly-owned properties $ 189,314 $ 187,268 $ 2,046 $ 735,392 $ 704,909 $ 30,483
On-campus participating properties 10,415 10,117 298 33,433 31,586 1,847
Third-party development properties 677 1,786 (1,109 ) 4,606 4,964 (358 )
Third-party management services 2,685 2,227 458 9,724 8,813 911
Resident services 881 800 81 3,206 3,109 97
Total revenues 203,972 202,198 1,774 786,361 753,381 32,980
Operating expenses
Wholly-owned properties 80,121 79,164 957 337,296 331,836 5,460
On-campus participating properties 3,322 3,270 52 13,447 12,437 1,010
Third-party development and management services 3,895 3,792 103 14,533 14,346 187
General and administrative 5,683 5,171 512 22,493 20,838 1,655
Depreciation and amortization 51,901 54,685 (2,784 ) 211,387 208,788 2,599
Ground/facility leases 2,431 2,391 40 9,167 8,232 935
Provision for real estate impairment 4,895 — 4,895 4,895 — 4,895
Total operating expenses 152,248 148,473 3,775 613,218 596,477 16,741
Operating income 51,724 53,725 (2,001 ) 173,143 156,904 16,239
Nonoperating income and (expenses)
Interest income 1,455 1,125 330 5,481 4,421 1,060
Interest expense (16,925 ) (24,162 ) 7,237 (78,687 ) (87,789 ) 9,102
Amortization of deferred financing costs (1,282 ) (1,518 ) 236 (6,520 ) (5,550 ) (970 )
Gain from disposition of real estate 3,788 — 3,788 21,197 52,699 (31,502 )
Loss from early extinguishment of debt (12,841 ) — (12,841 ) (12,841 ) (1,770 ) (11,071 )
Other nonoperating income — — — — 388 (388 )
Total nonoperating expense (25,805 ) (24,555 ) (1,250 ) (71,370 ) (37,601 ) (33,769 )
Income before income taxes 25,919 29,170 (3,251 ) 101,773 119,303 (17,530 )
Income tax provision (115 ) (310 ) 195 (1,150 ) (1,242 ) 92
Net income 25,804 28,860 (3,056 ) 100,623 118,061 (17,438 )
Net income attributable to noncontrolling interests (412 ) (501 ) 89 (1,562 ) (2,070 ) 508
Net income attributable to ACC, Inc. and
$ 25,392 $ 28,359 $ (2,967 ) $ 99,061 $ 115,991 $ (16,930 ) Subsidiaries common stockholders
Other comprehensive income
Change in fair value of interest rate swaps and other 1,925 2,907 (982 ) 1,763 464 1,299
Comprehensive income $ 27,317 $ 31,266 $ (3,949 ) $ 100,824 $ 116,455 $ (15,631 )
Net income per share attributable to ACC, Inc.
and Subsidiaries common stockholders
Basic $ 0.19 $ 0.25 $ 0.76 $ 1.03
Diluted $ 0.19 $ 0.25 $ 0.75 $ 1.02
Weighted-average common shares outstanding
Basic 132,175,589 112,343,835 129,228,748 111,987,361
Diluted 132,950,306 113,001,039 130,018,729 114,032,222
Consolidated Statements of Funds from Operations
(Unaudited, $ in thousands, except share and per share data)
4
1. Represents an impairment charge recorded for The Province - Dayton, a wholly-owned property classified as held for sale as of December 31, 2016.
2. 50% of the properties’ net cash available for distribution after payment of operating expenses, debt service (including repayment of principal) and capital expenditures. Represents actual cash received
for the year-to-date periods and amounts accrued for the interim periods, which is included in ground/facility leases expense in the consolidated statements of comprehensive income (refer to page 3).
3. Represents losses associated with the early pay-off of mortgage loans for four properties sold during the twelve months ended December 31, 2015 and nine properties sold during the twelve months
ended December 30, 2016. Such costs are excluded from gains from disposition of real estate reported in accordance with GAAP. However, the company views the losses from early extinguishment
of debt associated with the sales of real estate as an incremental cost of the sale transactions because we extinguished the debt in connection with the consummation of the sale transactions and had
no intent to extinguish the debt absent such transactions. The company believes that adjusting FFOM to exclude these losses more appropriately reflects the results of its operations exclusive of the
impact of our disposition transactions.
Three Months Ended December 31, Year Ended December 31,
2016 2015 $ Change 2016 2015 $ Change
Net income attributable to ACC, Inc. and
$ 25,392 $ 28,359 $ (2,967 ) $ 99,061 $ 115,991 $ (16,930 ) Subsidiaries common stockholders
Noncontrolling interests 412 501 (89 ) 1,562 2,070 (508 )
Gain from disposition of real estate (3,788 ) — (3,788 ) (21,197 ) (52,699 ) 31,502
Elimination of provision for real estate impairment1 4,895 — 4,895 4,895 — 4,895
Real estate related depreciation and amortization 51,044 53,766 (2,722 ) 208,276 206,019 2,257
Funds from operations ("FFO") attributable to
77,955 82,626 (4,671 ) 292,597 271,381 21,216 common stockholders and OP unitholders
Elimination of operations of on-campus participating properties
Net income from on-campus participating properties (3,492 ) (3,030 ) (462 ) (5,194 ) (4,236 ) (958 )
Amortization of investment in on-campus participating properties (1,850 ) (1,803 ) (47 ) (7,343 ) (7,034 ) (309 )
72,613 77,793 (5,180 ) 280,060 260,111 19,949
Modifications to reflect operational performance of on-campus
participating properties
Our share of net cashflow2 794 853 (59 ) 2,964 3,118 (154 )
Management fees 476 467 9 1,503 1,424 79
Contribution from on-campus participating properties 1,270 1,320 (50 ) 4,467 4,542 (75 )
Property acquisition costs 212 — 212 326 2,836 (2,510 )
Elimination of loss from early extinguishment of debt3 12,841 — 12,841 12,841 1,770 11,071
Funds from operations-modified ("FFOM") attributable to
$ 86,936 $ 79,113 $ 7,823 $ 297,694 $ 269,259 $ 28,435 common stockholders and OP unitholders
FFO per share - diluted $ 0.58 $ 0.72 $ 2.23 $ 2.38
FFOM per share - diluted $ 0.65 $ 0.69 $ 2.27 $ 2.36
Weighted-average common shares outstanding - diluted 134,120,391 114,513,960 131,340,992 114,141,997
Wholly-Owned Properties Results of Operations
($ in thousands)
5
Three Months Ended December 31, Year Ended December 31,
2016 2015 $ Change % Change 2016 2015 $ Change % Change
Wholly-owned properties revenues
Same store properties $ 150,873 $ 147,251 $ 3,622 2.5 % $ 576,760 $ 559,390 $ 17,370 3.1 %
New properties 28,812 18,097 10,715 88,399 38,340 50,059
Sold and held for sale properties1 10,510 22,720 (12,210 ) 73,439 110,288 (36,849 )
Total revenues2 $ 190,195 $ 188,068 $ 2,127 1.1 % $ 738,598 $ 708,018 $ 30,580 4.3 %
Wholly-owned properties operating expenses
Same store properties3 $ 63,878 $ 62,006 $ 1,872 3.0 % $ 264,054 $ 257,094 $ 6,960 2.7 %
New properties 10,915 7,103 3,812 36,163 20,775 15,388
Sold and held for sale properties1 4 5,328 10,055 (4,727 ) 37,079 53,967 (16,888 )
Total operating expenses $ 80,121 $ 79,164 $ 957 1.2 % $ 337,296 $ 331,836 $ 5,460 1.6 %
Wholly-owned properties net operating income
Same store properties $ 86,995 $ 85,245 $ 1,750 2.1 % $ 312,706 $ 302,296 $ 10,410 3.4 %
New properties 17,897 10,994 6,903 52,236 17,565 34,671
Sold and held for sale properties1 5,182 12,665 (7,483 ) 36,360 56,321 (19,961 )
Total net operating income $ 110,074 $ 108,904 $ 1,170 1.1 % $ 401,302 $ 376,182 $ 25,120 6.7 %
Note: The same store grouping above represents properties owned and operating for both of the entire years ended December 31, 2016 and 2015, which are not conducting or planning to conduct
substantial development or redevelopment activities, and are not classified as held for sale as of December 31, 2016. Refer to page 19 for detail of our same store groupings.
1. Includes 20 properties sold in 2015, along with 21 properties sold during 2016, which are disclosed on page 10. Also includes one property classified as held for sale as of December 31, 2016.
2. Includes revenues that are reflected as Resident Services Revenue on the accompanying consolidated statements of comprehensive income.
3. See page 6 for detail of same store operating expenses.
4. Does not include the allocation of payroll and other administrative costs related to corporate management and oversight.
Same Store Wholly-Owned Properties Operating Expenses
($ in thousands, except per bed amounts)
6
Three Months Ended December 31,
2016 2015
Total Per Bed
% Change
From Prior
Year
% of Total
Operating
Expenses Total Per Bed
% of Total
Operating
Expenses
General & administrative and other1 $ 14,972 $ 223 2.0 % 24 % $ 14,677 $ 219 24 %
Property taxes2 14,188 212 4.1 % 22 % 13,632 204 22 %
Utilities3 14,640 219 3.7 % 23 % 14,120 211 23 %
Payroll4 11,718 175 (2.3 )% 18 % 11,996 179 19 %
Repairs and maintenance5 4,478 67 10.9 % 7 % 4,039 60 7 %
Marketing6 2,470 37 16.1 % 4 % 2,128 32 3 %
Insurance 1,412 21 (0.1 )% 2 % 1,414 21 2 %
Total same store wholly-owned operating expenses $ 63,878 $ 954 3.0 % 100 % $ 62,006 $ 926 100 %
Same store wholly-owned beds 66,993
Year Ended December 31,
2016 2015
Total Per Bed
% Change
From Prior
Year
% of Total
Operating
Expenses Total Per Bed
% of Total
Operating
Expenses
General & administrative and other1 $ 58,575 $ 874 3.4 % 22 % $ 56,637 $ 846 22 %
Property taxes2 57,865 864 5.3 % 22 % 54,953 820 21 %
Utilities3 56,651 846 2.3 % 21 % 55,379 827 22 %
Payroll4 50,774 758 0.0 % 19 % 50,797 758 20 %
Repairs and maintenance5 25,334 378 1.1 % 10 % 25,065 374 10 %
Marketing6 9,303 139 10.3 % 4 % 8,434 126 3 %
Insurance 5,552 83 (4.8 )% 2 % 5,829 87 2 %
Total same store wholly-owned operating expenses $ 264,054 $ 3,942 2.7 % 100 % $ 257,094 $ 3,838 100 %
Same store wholly-owned beds 66,993
Note: The same store grouping above represents properties owned and operating for both of the entire years ended December 31, 2016 and 2015, which are not conducting or planning to conduct substantial
development or redevelopment activities, and are not classified as held for sale as of December 31, 2016. Refer to page 19 for detail of our same store groupings.
1. Includes security costs, shuttle costs, and property-level general and administrative costs as well as an allocation of costs related to corporate management and oversight. Also includes acquisition integration
costs, bad debt, food service, and other miscellaneous expenses.
2. The increase over the prior year is primarily due to additional property tax expense resulting from higher than anticipated property tax assessments in various markets.
3. Represents gross expenses prior to any recoveries from tenants, which are reflected in wholly-owned properties revenues.
4. Includes payroll and related expenses for on-site personnel including general managers, maintenance staff, and leasing staff.
5. Includes general maintenance costs such as interior painting, routine landscaping, pest control, fire protection, snow removal, elevator maintenance, roof and parking lot repairs, and other miscellaneous
building repair costs. Also includes costs related to the annual turn process. The increase over the prior year three month period is primarily attributable to non-routine occurrences at certain properties.
6. Includes costs related to property marketing campaigns associated with our ongoing leasing efforts. The increase over the prior year is primarily related to fourth quarter 2016 marketing activities designed to
drive leasing velocity for the upcoming 2017/2018 academic year.
Seasonality of Operations
($ in thousands, except per bed amounts)
7
Three Months Ended
Total/Weighted Average-
December 31, 2015 March 31, 2016 June 30, 2016 September 30, 2016 December 31, 2016 Last 12 Months
2016 same store properties
Revenue per occupied bed
Rental revenue per occupied bed per month $ 692 $ 691 $ 676 $ 688 $ 714 $ 693
Other income per occupied bed per month1 55 54 65 84 55 64
Total revenue per occupied bed $ 747 $ 745 $ 741 $ 772 $ 769 $ 757
Average number of owned beds 66,993 66,993 66,993 66,993 66,993 66,993
Average physical occupancy for the quarter 98.1 % 97.6 % 92.0 % 92.0 % 97.6 % 94.8 %
Total revenue $ 147,251 $ 146,117 $ 137,097 $ 142,673 $ 150,873 $ 576,760
Property operating expenses 62,006 61,515 61,570 77,091 63,878 264,054
Net operating income $ 85,245 $ 84,602 $ 75,527 $ 65,582 $ 86,995 $ 312,706
Operating margin 57.9 % 57.9 % 55.1 % 46.0 % 57.7 % 54.2 %
2016 new properties
Revenue per occupied bed
Rental revenue per occupied bed per month $ 787 $ 784 $ 785 $ 789 $ 805 $ 792
Other income per occupied bed per month1 74 71 69 80 66 71
Total revenue per occupied bed $ 861 $ 855 $ 854 $ 869 $ 871 $ 863
Average number of owned beds 7,738 7,738 7,738 9,648 11,613 9,184
Average physical occupancy for the quarter 90.5 % 91.7 % 91.9 % 92.1 % 95.0 % 92.9 %
Total revenue $ 18,097 $ 18,195 $ 18,223 $ 23,169 $ 28,812 $ 88,399
Property operating expenses 7,103 7,114 6,928 11,206 10,915 36,163
Net operating income $ 10,994 $ 11,081 $ 11,295 $ 11,963 $ 17,897 $ 52,236
Operating margin 60.8 % 60.9 % 62.0 % 51.6 % 62.1 % 59.1 %
ALL PROPERTIES
Revenue per occupied bed
Rental revenue per occupied bed per month $ 702 $ 700 $ 687 $ 700 $ 728 $ 704
Other income per occupied bed per month1 56 56 66 84 56 65
Total revenue per occupied bed $ 758 $ 756 $ 753 $ 784 $ 784 $ 769
Average number of owned beds 74,731 74,731 74,731 76,641 78,606 76,177
Average physical occupancy for the quarter 97.3 % 97.0 % 92.0 % 92.0 % 97.2 % 94.6 %
Total revenue $ 165,348 $ 164,312 $ 155,320 $ 165,842 $ 179,685 $ 665,159
Property operating expenses 69,109 68,629 68,498 88,297 74,793 300,217
Net operating income $ 96,239 $ 95,683 $ 86,822 $ 77,545 $ 104,892 $ 364,942
Operating margin 58.2 % 58.2 % 55.9 % 46.8 % 58.4 % 54.9 %
Sold and held for sale properties2
Total revenue $ 22,720 $ 22,192 $ 20,075 $ 20,662 $ 10,510 $ 73,439
Property operating expenses3 10,055 10,222 9,224 12,305 5,328 37,079
Net operating income $ 12,665 $ 11,970 $ 10,851 $ 8,357 $ 5,182 $ 36,360
Note: The same store grouping above represents properties owned and operating for both of the entire years ended December 31, 2016 and 2015, which are not conducting or planning to conduct substantial development or
redevelopment activities, and are not classified as held for sale as of December 31, 2016. Refer to page 19 for detail of our same store groupings.
1. Other income is all income other than Net Student Rent. This includes, but is not limited to, utility income, damages, parking income, summer conference rent, application and administration fees, income from retail tenants, etc.
2. Includes 21 properties sold during 2016, which are disclosed on page 10. Also includes one property classified as held for sale as of December 31, 2016.
3. Does not include the allocation of payroll and other administrative costs related to corporate management and oversight.
Seasonality of Operations - Build-up to 2017 Same Store Grouping
($ in thousands, except per bed amounts)
8
Three Months Ended
Total/Weighted Average-
March 31, 2016 June 30, 2016 September 30, 2016 December 31, 2016 Last 12 Months
2016 same store properties1
Revenue per occupied bed
Rental revenue per occupied bed per month $ 691 $ 676 $ 688 $ 714 $ 693
Other income per occupied bed per month2 54 65 84 55 64
Total revenue per occupied bed $ 745 $ 741 $ 772 $ 769 $ 757
Average number of owned beds 66,993 66,993 66,993 66,993 66,993
Average physical occupancy for the quarter 97.6 % 92.0 % 92.0 % 97.6 % 94.8 %
Total revenue $ 146,117 $ 137,097 $ 142,673 $ 150,873 $ 576,760
Property operating expenses 61,515 61,570 77,091 63,878 264,054
Net operating income $ 84,602 $ 75,527 $ 65,582 $ 86,995 $ 312,706
Operating margin 57.9 % 55.1 % 46.0 % 57.7 % 54.2 %
2017 new same store properties3
Revenue per occupied bed
Rental revenue per occupied bed per month $ 784 $ 785 $ 787 $ 813 $ 793
Other income per occupied bed per month2 67 68 89 77 75
Total revenue per occupied bed $ 851 $ 853 $ 876 $ 890 $ 868
Average number of owned beds 7,738 7,738 7,738 7,738 7,738
Average physical occupancy for the quarter 91.7 % 91.9 % 93.3 % 96.0 % 93.2 %
Total revenue $ 18,108 $ 18,205 $ 18,982 $ 19,833 $ 75,128
Property operating expenses 7,041 6,843 8,967 7,667 30,518
Net operating income $ 11,067 $ 11,362 $ 10,015 $ 12,166 $ 44,610
Operating margin 61.1 % 62.4 % 52.8 % 61.3 % 59.4 %
2017 SAME STORE PROPERTIES
Revenue per occupied bed
Rental revenue per occupied bed per month $ 700 $ 687 $ 698 $ 725 $ 703
Other income per occupied bed per month2 55 66 85 57 65
Total revenue per occupied bed $ 755 $ 753 $ 783 $ 782 $ 768
Average number of owned beds 74,731 74,731 74,731 74,731 74,731
Average physical occupancy for the quarter 97.0 % 92.0 % 92.1 % 97.4 % 94.6 %
Total revenue $ 164,225 $ 155,302 $ 161,655 $ 170,706 $ 651,888
Property operating expenses 68,556 68,413 86,058 71,545 294,572
Net operating income $ 95,669 $ 86,889 $ 75,597 $ 99,161 $ 357,316
Operating margin 58.3 % 55.9 % 46.8 % 58.1 % 54.8 %
Note: The purpose of the table above is to provide a build-up to the 2017 same store property grouping. Refer to page 19 for detail of our same store groupings.
1. This section presents operating results for the 2016 same store properties from page 7.
2. Other income is all income other than Net Student Rent. This includes, but is not limited to, utility income, damages, parking income, summer conference rent, application and administration fees, income from retail tenants, etc.
3. Includes twelve properties opened, acquired or renovated in 2015 that will become part of the same store grouping for 2017.
2017 / 2018 Leasing Status
9
Current Year Prior Year
Applications + Rentable % of Rentable % of Rentable Design Final Fall 2016
Applications + Leases Leases1 Beds2 Beds Beds Beds Occupancy3
2018 Same Store Wholly-owned Properties
Final Fall 2016 occupancy of 98% or greater 39,364 53,033 74.2% 73.1% 53,154 99.8%
Final Fall 2016 occupancy between 95% and 98% 4,882 9,057 53.9% 51.6% 9,086 96.9%
Final Fall 2016 occupancy less than 95% 7,697 16,282 47.3% 40.5% 16,391 88.5%
Total 2018 Same Store Wholly-owned Properties 51,943 78,372 66.3% 64.0%4 78,631 97.1%
New Wholly-owned Properties5 3,116 7,383 42.2% n/a 7,454 n/a
Total - Wholly-owned Properties 55,059 85,755 64.2% n/a 86,085 n/a
Current Year Prior Year Initial Current
Rentable % of Rentable % of Rentable Design Final Fall 2016 Projected Rate Projected Rate
Leases Leases1 Beds2 Beds Beds Beds Occupancy3 Increase Increase6
2018 Same Store Wholly-owned Properties
Final Fall 2016 occupancy of 98% or greater 36,025 53,033 67.9% 67.7% 53,154 99.8%
Final Fall 2016 occupancy between 95% and 98% 4,574 9,057 50.5% 49.0% 9,086 96.9%
Final Fall 2016 occupancy less than 95% 6,427 16,282 39.5% 37.0% 16,391 88.5%
Total 2018 Same Store Wholly-owned Properties 47,026 78,372 60.0% 59.3%4 78,631 97.1% 2.9% 2.9%
New Wholly-owned Properties5 2,453 7,383 33.2% n/a 7,454 n/a n/a n/a
Total - Wholly-owned Properties 49,479 85,755 57.7% n/a 86,085 n/a 2.9% 2.9%
Note: The same store grouping presented above for purposes of disclosing the pre-leasing status for the upcoming 2017/2018 academic year represents properties that will be classified as same store
properties in 2018. Refer to page 19 for detail of our same store groupings.
1. As of February 17, 2017 for current year and February 17, 2016 for prior year.
2. Rentable beds exclude beds needed for on-site staff.
3. As of September 30, 2016.
4. Properties not owned or under ACC management during the prior year, or properties whose leasing progress is not comparable to the prior year as a result of plans to renovate or redevelop the
property, are excluded for purposes of calculating the prior year percentage of rentable beds.
5. Properties currently under construction with an anticipated delivery date of Fall 2018 are not included because these properties will not begin undertaking leasing activities until Fall 2017.
6. Projected rate increase reflects projected rental rates anticipated to be achieved through the end of the company's leasing cycle, up to targeted occupancy.
Investment Update
($ in thousands)
10
ACQUISITIONS
Assumed
Project Location Primary University Served Beds Closing Date Purchase Price Mortgage Debt
University Crossings Charlotte, NC University of North Carolina 546 August 31, 2016 $ —
U Point Syracuse, NY Syracuse University 163 October 13, 2016 —
709 $ 63,100 $ —
DISPOSITIONS
Outstanding
Project Location Primary University Served Beds Closing Date Sales Price Mortgage Debt
The Edge Orlando, FL University of Central Florida 930 March 11, 2016 $ —
University Village Sacramento, CA California State University 394 March 24, 2016 —
1,324 $ 73,800 $ —
Portfolio Disposition
Abbott Place East Lansing, MI Michigan State University 654 November 15, 2016 —
Burbank Commons Baton Rouge, LA Louisiana State University 532 November 15, 2016 —
Campus Corner Bloomington, IN Indiana University 796 November 15, 2016 —
Campus Way Tuscaloosa, AL University of Alabama 680 November 15, 2016 —
Forest Village and Woodlake Columbia, MO University of Missouri 704 November 15, 2016 —
Garnet River Walk West Columbia, SC University of South Carolina 476 November 15, 2016 16,586
Grindstone Canyon Columbia, MO University of Missouri 384 November 15, 2016 13,700
Lions Crossing State College, PA Penn State University 696 November 15, 2016 —
Nittany Crossing State College, PA Penn State University 684 November 15, 2016 —
Pirates Place Townhomes Greenville, NC East Carolina University 528 November 15, 2016 4,020
The Centre Kalamazoo, MI Western Michigan University 700 November 15, 2016 19,875
The Cottages of Baton Rouge Baton Rouge, LA Louisiana State University 1,290 November 15, 2016 62,158
The Cottages of Columbia Columbia, MO University of Missouri 513 November 15, 2016 19,341
U Club Cottages Baton Rouge, LA Louisiana State University 308 November 15, 2016 15,336
University Club & The Grove1 Tallahassee, FL Florida State University 736 November 15, 2016 —
University Crescent Baton Rouge, LA Louisiana State University 612 November 15, 2016 24,150
University Heights Birmingham, AL University of Alabama at Birmingham 528 November 15, 2016 —
University Manor Greenville, NC East Carolina University 600 November 15, 2016 —
University Oaks Columbia, SC University of South Carolina 662 November 15, 2016 22,150
12,083 $ 508,000 $ 197,316
TOTAL DISPOSITIONS 13,407 $ 581,800 $ 197,316
HELD FOR SALE2
Anticipated
Project Location Primary University Served Beds Closing Date3
The Province - Dayton Dayton, OH Wright State University 657 Q2 2017
1. Property consists of two phases.
2. This property has met all necessary criteria required to be classified as held for sale under generally accepted accounting principles (GAAP) as of December 31, 2016. Concurrent with this classification this
property was recorded at the lower of cost or fair value less estimated selling costs which resulted in an impairment charge of $4.9 million. The net book value of this property is included in wholly-owned
properties held for sale on the consolidated balance sheet as of December 31, 2016 (refer to page 2).
3. The closing of the transaction is subject to the satisfaction of various contingencies and closing conditions.
Owned Development Update
($ in thousands)
11
OWNED DEVELOPMENT PROJECTS UNDER CONSTRUCTION
As of December 31, 2016
Project Estimated Land and Total Costs Scheduled
Project Location Primary University Served Type Beds Project Cost1 CIP2 Other3 Incurred Completion
Arizona State Univ. Res. Hall Tempe, AZ Arizona State University ACE 1,594 $ 107,800 $ 67,725 $ 1,048 $ 68,773 August 2017
Sky View Flagstaff, AZ Northern Arizona University ACE 626 56,600 31,189 610 31,799 August 2017
University Square Prairie View, TX Prairie View A&M University ACE 466 26,800 14,778 284 15,062 August 2017
U Centre on Turner Columbia, MO University of Missouri Off-campus 718 69,100 36,036 14,675 50,711 August 2017
U Pointe on Speight Waco, TX Baylor University Off-campus 700 49,800 22,543 5,156 27,699 August 2017
21Hundred @ Overton Park Lubbock, TX Texas Tech University Off-campus 1,204 81,600 43,781 17,722 61,503 August 2017
Suites at 3rd Champaign, IL University of Illinois Off-campus 251 25,000 10,395 996 11,391 August 2017
U Club Binghamton Phase II Binghamton, NY SUNY Binghamton University Off-campus 562 55,800 23,407 12,622 36,029 August 2017
Callaway House Apartments Norman, OK University of Oklahoma Off-campus 915 89,100 39,490 13,314 52,804 August 2017
U Centre on College Clemson, SC Clemson University Off-campus 418 41,500 25,408 275 25,683 August 2017
SUBTOTAL - 2017 DELIVERIES 7,454 $ 603,100 $ 314,752 $ 66,702 $ 381,454
Virginia Commonwealth Univ. Richmond, VA Virginia Commonwealth Univ. ACE 1,524 $ 95,700 $ 14,020 $ — $ 14,020 August 2018
Schwitzer Hall Indianapolis, IN Butler University ACE 648 38,900 2,416 — 2,416 August 2018
Greek Leadership Village Tempe, AZ Arizona State University ACE 957 69,600 — 3,107 3,107 August 2018
Bancroft Residence Hall Berkeley, CA University of California, Berkeley ACE 781 98,700 11,286 — 11,286 August 2018
U Club Townhomes Oxford, MS University of Mississippi Off-campus 528 44,300 — 5,883 5,883 August 2018
SUBTOTAL - 2018 DELIVERIES 4,438 $ 347,200 $ 27,722 $ 8,990 $ 36,712
Columbus Avenue Student Apts. Boston, MA Northeastern University ACE 825 $ 153,400 $ — $ 3,868 $ 3,868 August 2019
SUBTOTAL - 2019 DELIVERIES 825 $ 153,400 $ — $ 3,868 $ 3,868
PRESALE DEVELOPMENT PROJECT UNDER CONSTRUCTION
As of December 31, 2016
Project Estimated Land and Total Costs Scheduled
Project Location Primary University Served Type Beds Project Cost CIP2 Other3 Incurred Completion
The Edge - Stadium Centre4 Tallahassee, FL Florida State University Off-campus 412 $ 42,600 $ 1,934 $ 400 $ 2,334 August 2018
OWNED DEVELOPMENT PIPELINE5
Project Anticipated Approx. Estimated Targeted
Project Location Primary University Served Type Commencement Targeted Beds Project Cost1 6 Completion
Carbondale Development Carbondale, IL Southern Illinois University Off-campus TBD 650 $ 32,000 TBD
1. In certain instances at ACE properties, the company agrees to construct spaces within the property that will ultimately be owned, managed, and funded by the universities. Such spaces include but are not limited to dining, childcare, retail,
academic, and office facilities. The Estimated Project Cost excludes the costs of the construction of such facilities, as they will be reimbursed by the universities.
2. The total construction in progress (“CIP”) balance above excludes $5.1 million related to ongoing renovation projects at operating properties.
3. Consists of amounts incurred to purchase the land for off-campus development projects, as well as other development-related expenditures not included in CIP such as deposits, furniture, etc.
4. In December 2016, the company entered into a pre-sale agreement to purchase The Edge - Stadium Centre, a property which will be completed in August 2018. The company is obligated to purchase the property as long as certain construction
completion deadlines and other closing conditions are met. The company is responsible for leasing, management, and initial operations of the project while the third-party developer retains development risk during the construction period. In
accordance with accounting guidance, the company is including this property in its consolidated financial statements. Estimated project cost includes purchase price, elected upgrades and transaction costs.
5. Does not include undeveloped land parcels in seven university markets totaling $34.6 million. Commencement of owned off-campus development projects is subject to final determination of feasibility, execution and closing on definitive
agreements, municipal approval processes, fluctuations in the construction market, and current capital market conditions. ACE awards provide the company with the opportunity to exclusively negotiate with the subject universities.
Commencement of ACE projects is subject to various levels of university board approval, final determination of feasibility, execution and closing on definitive agreements, municipal approval processes, fluctuations in the construction market, and
current capital market conditions.
6. Estimated Project Cost includes land and other predevelopment costs of $4.1 million incurred as of December 31, 2016 for owned development pipeline projects.
Third-Party Development Update
($ in thousands)
12
Three Months Ended December 31, Year Ended December 31,
2016 2015 $ Change 2016 2015 $ Change
Development services revenue $ 677 $ 1,786 $ (1,109 ) $ 4,606 $ 4,964 $ (358 )
% of total revenue 0.3 % 0.9 % 0.6 % 0.7 %
RECENTLY COMPLETED PROJECTS
Project Location Primary University Served Beds Total Fees Completed
Oregon State Univ. Cascades Bend, OR Oregon State University 340 $ 1,900 December 2016
CONTRACTED PROJECTS IN PROGRESS
Fees Earned Fees Remaining Fees
as of Earned in as of Scheduled
Project Location Primary University Served Beds Total Fees December 31, 2016 Current Year December 31, 2016 Completion
Momentum Village Phase II Corpus Christi, TX Texas A&M University Corpus Christi 560 $ 2,300 $ 1,580 $ 1,580 $ 720 August 2017
Esperanza Hall San Antonio, TX Texas A&M University San Antonio 382 1,100 735 735 365 August 2017
942 $ 3,400 $ 2,315 $ 2,315 $ 1,085
1. These awards relate to speculative development projects that are subject to final determination of feasibility, negotiation, final award, procurement rules and other applicable law, execution and closing of
definitive agreements on terms acceptable to the company, and fluctuations in the construction and financing markets. Anticipated commencement and fees are dependent upon the availability of project
financing, which is affected by current capital market conditions.
2. Under the terms of a Consultant Agreement, and with the consent of the University’s Board of Regents, the company will earn fees for the performance of advisory services related to a not-for-profit entity’s
purchase of a 1,790-bed apartment community for the benefit of the University.
ON-CAMPUS AWARD PIPELINE1
Anticipated Anticipated Targeted Estimated
Project Location Financing Structure Commencement Completion Fees
Texas A&M University Corpus Christi2 Corpus Christi, TX Third-party n/a 2017/2018 $1,400
Louisville Village Site Louisville, KY ACE TBD Fall 2019 n/a
Northern Kentucky University Highland Heights, KY Third-party Q4 2017/Q1 2018 Fall 2019 TBD
La Salle University Philadelphia, PA Third-party TBD TBD TBD
Management Services Update
($ in thousands)
13
Three Months Ended December 31, Year Ended December 31,
2016 2015 $ Change 2016 2015 $ Change
Management services revenue $ 2,685 $ 2,227 $ 458 $ 9,724 $ 8,813 $ 911
% of total revenue 1.3 % 1.1 % 1.2 % 1.2 %
NEW / PENDING MANAGEMENT CONTRACTS
Actual or
Approximate Stabilized Anticipated
Project Location Primary University Served Beds Annual Fees1 Commencement
The Nest Chicago, IL Northeastern Illinois University 440 $ 170 August 2016
Garden Village2 Berkeley, CA University of California, Berkeley 236 120 August 2016
Centennial Place Toronto, Canada Centennial College 742 170 September 2016
Collegeview Commons3 Ontario, Canada Conestoga College 487 50 September 2016
Parkside Toronto, Canada Ryerson University 597 173 November 2016
Saban Real Estate Group4 Various Various 7,060 284 November 2016
Momentum Village Phase II Corpus Christi, TX Texas A&M University Corpus Christi 560 180 August 2017
Esperanza Hall San Antonio, TX Texas A&M University San Antonio 382 100 August 2017
Collegeview Commons Phase II Ontario, Canada Conestoga College 513 50 September 2017
CampusOne5 Toronto, Canada University of Toronto 892 291 September 2017
Texas A&M University Corpus Christi Corpus Christi, TX Texas A&M University Corpus Christi 1790 480 2017/2018
13,699 $ 2,068
DISCONTINUED MANAGEMENT CONTRACTS
2016 Fee
Contribution
Prior to
Project Location Primary University Served Beds Termination Discontinued As Of
3170 & 3190 Donnelly Windsor, Ontario University of Windsor 117 $ 4 April 2016
675 Richmond London, Ontario University of Western Ontario 451 16 April 2016
West Village Suites Hamilton, Ontario McMaster University 449 45 July 2016
The Luxe Waterloo, Ontario University of Waterloo 955 92 July 2016
Village Suites Oshawa, Ontario Durham College 588 51 July 2016
Centennial Toronto, Canada Centennial College 368 42 September 2016
2,928 $ 250
1. Stabilized annual fees are dependent upon the achievement of anticipated occupancy levels.
2. The stabilized annual fee amount does not include an initial operations fee of $40,000 earned in August 2016. Subsequent to August 2016, the stabilized annual fee will be approximately $120,000
per year.
3. The stabilized annual fee amount does not include an initial operations fee of $90,000 earned from December 2015 through August 2016. Subsequent to August 2016, the stabilized annual fee will
be approximately $50,000 per year.
4. In November 2016, the company sold a portfolio of 19 properties to Saban Real Estate Group. Refer to page 10 for disposition details. The company will continue to manage 11 of the properties
during a transition period subsequent to the sale for up to five months. The stabilized annual fee amount does not include management fees of $220,000 earned in Q4 2016. The company anticipates
management fees of approximately $284,000 to be earned during Q1 2017 after which the transition period will conclude.
5. The stabilized annual fee amount does not include an initial operations fee of $60,000 earned from February 2017 through August 2017. Subsequent to August 2017, the stabilized annual fee will be
approximately $291,000 per year.
Capital Structure as of December 31, 2016
($ in millions, except per share data)
14
Market Capitalization & Unsecured Notes Covenants Debt Maturity Schedule
Total Debt1 $ 2,114
Total Equity Market Value2 6,674
Total Market Capitalization $ 8,788
Debt to Total Market Capitalization 24.1%
Net Debt to EBITDA3 5.4x
Total Asset Value4 $ 6,766
Unencumbered Asset Value $ 5,482
Unencumbered Asset Value to Total Asset Value 81.0%
Requirement Current Ratio
Total Debt to Total Asset Value ≤ 60% 31.3%
Secured Debt to Total Asset Value ≤ 40% 9.8%
Unencumbered Asset Value to Unsecured Debt > 150% 378.2%
Interest Coverage3 > 1.5x 4.5x
Weighted Average
Principal Average Term To
Outstanding Interest Rate Maturity
Fixed Rate Mortgage Loans $ 560 4.8%5 4.2 Yrs
Unsecured Revolving Credit Facility6 99 2.0% 1.2 Yrs
Unsecured Term Loans7 150 2.0% 4.1 Yrs
Unsecured Notes 1,200 3.8% 5.8 Yrs
On-Campus Participating Properties 105 5.1% 15.3 Yrs
Total/Weighted Average $ 2,114 3.9% 5.5 Yrs
Variable Rate Debt as % of Total Debt8 4.7 %
Note – refer to the definitions outlined on pages 20 and 21 for detailed definitions of terms appearing on this page.
1. Excludes net unamortized debt premiums related to mortgage loans assumed in connection with acquisitions of $26.8 million, unamortized original issue discount on unsecured notes of $1.9 million, and unamortized deferred
financing costs of $14.1 million.
2. Based on share price of $49.77 and fully diluted share count of 134,105,233 as of December 31, 2016. Assumes conversion of 1,106,644 common and preferred Operating Partnership units and 773,101 unvested restricted
stock awards.
3. Refer to calculations on page 15, including a reconciliation to net income and interest expense, the most directly comparable GAAP measures.
4. Excludes accumulated depreciation of $941.2 million and receivables and intangible assets, net of accumulated amortization, of $41.2 million.
5. Including the amortization of net debt premiums related to mortgage loans assumed in connection with property acquisitions, the effective interest rate for fixed rate mortgage loans is 3.5%.
6. In January 2017, the company amended and extended its senior unsecured revolving credit facility, increasing the facility from $500 million to $700 million and extending the maturity date from March 2018 to March 2022.The
amended facility has an accordion feature that allows the company to expand the facility by up to an additional $500 million, subject to the satisfaction of certain conditions.
7. In November 2016, the company repaid the $200 million term loan maturing January 2017 using proceeds from the sale of a 19-property portfolio. Refer to page 10 for disposition details.
8. As of December 31, 2016, the company’s variable rate debt consisted of the unsecured revolving credit facility as the company’s $150 million term loan maturing March 2021 was subject to an interest rate swap. In January
2017 the interest rate swap expired and the company’s term loan became classified as variable rate debt.
Weighted Average Interest Rate Of Debt Maturing Each Year
Fixed Rate
Mortgage
Loans
6.3% 4.2% - 5.6% 5.2% 4.0% - 4.5% - 3.7%
Total
Debt
6.3% 3.3% - 3.6% 3.9% 4.0% 3.9% 4.3% 7.6% 3.9%
+
Interest Coverage
($ in thousands)
15
Three Months Ended
March 31, June 30, September 30, December 31, Last Twelve
2016 2016 2016 2016 Months
Net income attributable to ACC, Inc. and Subsidiaries common stockholders $ 45,587 $ 18,438 $ 9,644 $ 25,392 $ 99,061
Net income attributable to noncontrolling interests 622 327 201 412 1,562
Interest expense 22,627 20,119 19,016 16,925 78,687
Income tax provision 345 345 345 115 1,150
Depreciation and amortization 53,716 53,703 52,067 51,901 211,387
Amortization of deferred financing costs 2,542 1,352 1,344 1,282 6,520
Share-based compensation 2,651 2,842 2,328 2,222 10,043
Provision for real estate impairment — — — 4,895 4,895
Loss on early extinguishment of debt — — — 12,841 12,841
Gain from disposition of real estate (17,409 ) — — (3,788 ) (21,197 )
Earnings Before Interest, Taxes, Depreciation,
and Amortization ("EBITDA") $ 110,681 $ 97,126 $ 84,945 $ 112,197 $ 404,949
Pro-forma adjustments to EBITDA1 (19,279 )
Adjusted EBITDA $ 385,670
Interest Expense from consolidated statement of comprehensive income $ 22,627 $ 20,119 $ 19,016 $ 16,925 $ 78,687
Amortization of mortgage debt premiums/discounts 3,236 3,188 3,104 2,454 11,982
Capitalized interest 2,090 3,565 3,301 3,302 12,258
Change in accrued interest payable 4,884 (4,275 ) (1,778 ) 3,320 2,151
Cash Interest Expense $ 32,837 $ 22,597 $ 23,643 $ 26,001 $ 105,078
Pro-forma adjustments to Cash Interest Expense1 (19,741 )
Adjusted Interest Expense $ 85,337
Interest Coverage 4.5x
Note: refer to the definitions outlined on pages 20 and 21 for detailed definitions of terms appearing on this page.
1. Adjustment to reflect all acquisitions, development deliveries, dispositions, debt repayments and debt refinancings as if such transactions had occurred on the first day of the 12 month period
presented.
Capital Allocation – Long Term Funding Plan
($ in millions)
16
Sources and Uses for Development - As of December 31, 2016
Estimated Development Capital Uses:
Estimated Project Total Costs Remaining
Development Pipeline1 Cost Incurred Capital Needs
2017 Developments Underway $ 603 $ 381 $ 222
2018 Developments Underway or Expected to Start in Current Year2 390 39 351
2019 Developments Underway or Expected to Start in Current Year 153 4 149
Total $ 1,146 $ 424 $ 722
Estimated Sources:
Capital Sources
Cash and Cash Equivalents $ 22
Estimated Cash Flow Available for Investment - through 20193 147
Equity Raised via ATM subsequent to December 31, 2016, to-date 52
Remaining Capital Needs4 501
Total $ 722
Selected Credit Metrics5
Credit Metric: December 31, 2016 Pro Forma6
Total Debt to Total Asset Value 31.3% 28.3% - 35.0%
Net Debt to EBITDA7 5.4x 4.5x - 5.7x
Note: This analysis demonstrates anticipated funding for the developments currently underway or with expected starts in the current year. As future developments commence,
they are expected to be funded via additional dispositions, free cash available for investment, and capital market transactions.
1. Includes development projects under construction, and management’s Estimated Project Cost for future development deliveries that are expected to commence construction during the current
year, as disclosed on page 11.
2. Includes the pre-sale development project disclosed on page 11.
3. Available cash flow is derived from disclosures in our 2015 Form 10-K and is calculated as net cash provided by operating activities of $261.0 million less dividend payments of $178.5 million, less
principal payments on debt of $14.5 million, less recurring capital expenditures of $19.4 million. Calculation results in available cash flow for investment in 2015 of $49.0 million, which is then
annualized over the remaining 12 quarters through the end of 2019.
4. Remaining capital needs are expected to come from a mix of debt, equity, and dispositions, including the proceeds from the sale of one property classified as held for sale as of December 31,
2016, which is anticipated to close in Q2 2017.
5. Refer to definitions outlined on pages 20 and 21 for detailed definitions of terms appearing on this page.
6. Ratios represent the pro forma impact of development deliveries and funding alternatives assumed in the Sources and Uses table. The lower end of the pro forma leverage ranges assumes
remaining capital needs are funded with equity, while the higher end assumes funding with debt. Actual ratios will vary based on the timing of construction funding and ultimate mix of sources from
debt, equity, or dispositions.
7. Refer to page 15 for a reconciliation of EBITDA to net income, the most directly comparable GAAP measure.
2017 Outlook - Summary1
($ in thousands, except share and per-share data)
17
Low High
Net income $ 103,400 $ 116,500
Noncontrolling interests 1,700 1,900
Depreciation and amortization 211,700 211,700
Funds from operations ("FFO") $ 316,800 $ 330,100
Elimination of operations from on-campus
participating properties (11,700 ) (12,100 )
Contribution from on-campus participating properties 4,100 4,700
Contractual executive separation and retirement charges2 4,550 4,550
Funds from operations - modified ("FFOM") $ 313,750 $ 327,250
Net income per share - diluted $ 0.76 $ 0.86
FFO per share - diluted $ 2.34 $ 2.44
FFOM per share - diluted $ 2.32 $ 2.42
Weighted-average common shares outstanding -
diluted 135,500,000 135,500,000
1. The company believes that the financial results for the fiscal year ending December 31, 2017 may be affected by, among other factors:
• national and regional economic trends and events;
• the timing of acquisitions and/or dispositions;
• interest rate risk;
• the timing of commencement of construction on owned development projects;
• the ability of the company to be awarded and the timing of the commencement of construction on third-party development projects;
• university enrollment, funding and policy trends;
• the ability of the company to earn third-party management revenues;
• the amount of income recognized by the taxable REIT subsidiaries and any corresponding income tax expense;
• the ability of the company to integrate acquired properties;
• the outcome of legal proceedings arising in the normal course of business; and
• the finalization of property tax rates and assessed values in certain jurisdictions.
2. Represents contractual executive separation and retirement charges to be incurred with regards to the retirement of the company's Chief Financial Officer, to be recognized in the first and second
quarter 2017.
2017 Outlook – Detail
($ in thousands, except share and per share data)
18
1. Refer to page 19 for detail of the 2017 same store and new property groupings.
2. Includes one property classified as held for sale as of December 31, 2016 that is anticipated to close in Q2 of 2017. See page 10.
3. Net of capitalized interest and excluding on-campus participating properties. The 2017 guidance ranges assume a $400 million fourth quarter bond offering.
4. Excludes on-campus participating properties.
5. Represents contractual executive separation and retirement charges to be incurred with regards to the retirement of the company's Chief Financial Officer, to be recognized in the first and second quarter 2017.
Components of 2017 Property Net Operating Income Third-party Services
Low High % Change From 2016 Low High
Wholly-owned properties Third-party development services revenue $ 6,200 $ 9,600
2017 same store properties1 Third-party management services revenue $ 9,600 $ 10,400
Revenue $ 669,100 $ 673,800 2.6% - 3.4% Third-party development and mgmt. services expenses $ 15,000 $ 15,500
Operating expenses (299,100 ) (297,600 ) 1.5% - 1.0%
Net operating income 370,000 376,200 3.6% - 5.3%
Corporate Expenses and Other
2017 new properties net operating income1 34,400 35,500 Low High
2017 speculative dispositions net operating income2 600 600 Net income:
Total wholly-owned properties net operating income $ 405,000 $ 412,300 General and administrative expenses $ 27,400 $ 27,800
Ground/facility leases expense:
ACE properties $ 6,900 $ 6,900
2017 Property Net Operating Income Guidance Assumptions On-campus participating properties 2,700 3,100
Low High Timing Total ground/facility leases expense $ 9,600 $ 10,000
AY 2017/2018 final leasing results - occupancy 96.55% 98.75% Fall 2017 Interest income $ 4,100 $ 5,000
AY 2017/2018 final leasing results - rental rate 3.15% 2.65% Fall 2017 Interest expense3 $ 60,600 $ 59,500
Development Deliveries $ 603,100 $ 603,100 See page 11 Capitalized interest $ 16,400 $ 16,300
Amortization of deferred financing costs4 $ 4,000 $ 4,000
Income tax provision $ 1,100 $ 1,100
FFOM:
Corporate depreciation $ 3,600 $ 3,200
Contribution from on-campus participating properties $ 4,100 $ 4,700
Contractual executive separation and retirement charges5 $ 4,550 $ 4,550
Detail of Property Groupings
As of December 31, 2016
19
2016 Grouping 2017 Grouping 2018 Grouping
Same Store Properties New Properties Same Store Properties New Properties Same Store Properties New Properties
# of Design # of Design # of Design # of Design # of Design # of Design
Properties Beds Properties Beds Properties Beds Properties Beds Properties Beds Properties Beds
Properties Purchased or Developed
Prior to January 1, 2015 113 66,993 113 66,993 113 66,993
2015 Acquisition Properties 7 3,535 7 3,535 7 3,535
2015 Development Deliveries 4 3,187 4 3,187 4 3,187
2015 Redevelopment Property 1 1,016 1 1,016 1 1,016
2016 Development Deliveries 7 3,191 7 3,191 7 3,191
2016 Acquisition Properties 2 709 2 709 2 709
2017 Development Deliveries 10 7,454 10 7,454 10 7,454
2018 Development Deliveries 4 3,365 4 3,365 4 3,365
Total Wholly-owned Properties 113 66,993 35 22,457 125 74,731 23 14,719 134 78,631 14 10,819
Total # Held for Sale Wholly-owned Properties 1
Total Held for Sale Wholly-owned Design Beds 657
Grand Total # of Wholly-owned Properties (All Groupings) 149
Grand Total Wholly-owned Design Beds (All Groupings) 90,107
Note on Property Portfolio: When disclosing our number of properties and design beds as of a certain date, we include all properties that are owned and operating as of that date, as well as properties that are
under construction and anticipated to open for operations in future years. Properties that are in our development pipeline but have not yet commenced construction are not included.
2016: The 2016 same store grouping represents properties owned and operating for both of the entire calendar years ended December 31, 2016 and 2015. This same store grouping is
used for purposes of presenting our 2016 same store operating results.
2017: The 2017 same store grouping represents properties that will be owned and operating for both of the entire calendar years ended December 31, 2017 and 2016. This same store
grouping will be used for purposes of presenting our 2017 same store operating results.
2018: The 2018 same store grouping represents properties that will be owned and operating for both of the entire calendar years ended December 31, 2018 and 2017. This same store
grouping will be used for purposes of presenting our 2018 same store operating results and our leasing status updates for the 2017/2018 academic year.
Definitions
ACE The company’s American Campus Equity program, whereby the company enters into long-term ground/facility lease agreements with
Universities to invest our capital and to develop, own, and operate on-campus student housing communities. Properties under this
structure are considered to be wholly-owned and are included in the company's consolidated financial statements.
Adjusted EBITDA* EBITDA, including pro forma adjustments to reflect acquisitions, development deliveries, and dispositions as if such transactions had
occurred on the first day of the 12-month period presented.
Adjusted Interest Expense Interest Expense, including pro forma adjustments to reflect acquisitions, development deliveries, dispositions, debt repayments, and
debt refinancings as if such transactions had occurred on the first day of the 12-month period presented.
Cash Cash and cash equivalents, determined on a consolidated basis in accordance with GAAP.
Cash Interest Expense* Consolidated interest expense calculated in accordance with GAAP, plus amounts which have been deducted and minus amounts which
have been added for, without duplication: (i) the amortization of mark-to-market premiums/discounts on mortgage loans assumed in
connection with acquisitions; (ii) capitalized interest; and (iii) the change in accrued interest during the period presented.
Design Beds Total beds based on the original property design, generally as specified in the construction documents.
EBITDA* Consolidated net income calculated in accordance with GAAP, plus amounts which have been deducted and minus amounts which have
been added for, without duplication: (i) interest expense; (ii) provision for income taxes; (iii) depreciation, amortization and all other non-
cash items; (iv) provision for gains and losses; (v) noncontrolling interests; and (vi) extraordinary and other non-recurring items, as we
determine in good faith.
Funds from Operations
(”FFO”)
Determined based on the definition adopted by the Board of Governors of the National Association of Real Estate Investment Trusts
(“NAREIT”). Calculated as consolidated net income or loss attributable to common shares computed in accordance with GAAP,
excluding gains or losses from depreciable operating property sales, plus real estate depreciation and amortization, and after
adjustments for unconsolidated partnerships and joint ventures. Also excludes non-cash impairment charges.
FFO Modified
(”FFOM”)
FFO modified to reflect certain adjustments related to the economic performance of our on-campus participating properties, and the
elimination of property acquisition costs, contractual executive separation and retirement charges and other non-cash items, as we
determine in good faith. The company believes it is meaningful to eliminate the FFO generated from the on-campus participating
properties and instead to reflect the company's 50% share of the properties' net cash flow and management and development fees
received, as this measure better reflects the economic benefit derived from the company's involvement in the operation of these
properties.
* These definitions are provided for purposes of calculating the company’s bond covenants and other key ratios.
20
Definitions
GAAP Accounting principles generally accepted in the United States of America.
Interest Coverage* Adjusted EBITDA / Adjusted Interest Expense.
Net Debt* Total Debt less Cash.
Net Debt to EBITDA* Net Debt divided by Adjusted EBITDA.
Net Operating Income
“NOI”
Property revenues less direct property operating expenses, excluding depreciation, but including allocated corporate general and
administrative expenses.
On-campus Participating
Properties
A transaction structure whereby the company enters into long-term ground/facility lease agreements with Universities to develop,
construct, and operate student housing communities. Under the terms of the leases, title to the constructed facilities is held by the
University/lessor and such lessor receives 50% of net cash flows, as defined, on an annual basis through the term of the lease.
Physical Occupancy Occupied beds, including staff accommodations, divided by Design Beds.
Rentable Beds Design beds less beds used by on-site staff.
Same Store Grouping Wholly-owned properties owned and operating for both of the entire annual periods presented, which are not conducting or planning to
conduct substantial development or redevelopment activities, and are not classified as held for sale as of the current quarter end date.
Secured Debt* The portion of Total Debt that is secured by a mortgage, trust, deed of trust, deed to secure indebtedness, pledge, security interest,
assignment of collateral, or any other security agreement.
Total Asset Value* Undepreciated book value of real estate assets and all other assets, excluding receivables and intangibles, of our consolidated
subsidiaries, all determined in accordance with GAAP.
Total Debt* Total consolidated debt calculated in accordance with GAAP, including capital leases and excluding mark-to-market premiums/discounts
on mortgage loans assumed in connection with acquisitions.
Total Equity Market Value Fully diluted common shares times the company’s stock price at period-end.
Unencumbered Asset Value* The sum of (i) the undepreciated book value of real estate assets which are not subject to secured debt; and (ii) all other assets,
excluding accounts receivable and intangibles, for such properties. Does not include assets of unconsolidated joint ventures.
Unsecured Debt* The portion of Total Debt that is not Secured Debt.
* These definitions are provided for purposes of calculating the company’s bond covenants and other key ratios.
21
Investor Information
Corporate Headquarters Investor Relations
American Campus Communities, Inc. Tel: (512) 732-1000 Ryan Dennison (512) 732-1000
12700 Hill Country Blvd., Suite T-200 Fax: (512) 732-2450 SVP, Investor Relations rdennison@americancampus.com
Austin, Texas 78738 www.americancampus.com
Executive Management
Bill Bayless Chief Executive Officer
Jim Hopke President
Jennifer Beese Chief Operating Officer
Jon Graf Chief Financial Officer
Kim Voss Chief Accounting Officer
William Talbot Chief Investment Officer
Research Coverage
Jacob Kilstein Argus Research Company (646) 747-5447 jkilstein@argusresearch.com
Jeffery Spector / Juan Sanabria Bank of America / Merrill Lynch (646) 855-1363 / (646) 855-1589 jeff.spector@baml.com / juan.sanabria@baml.com
Ryan Meliker / Michael Kodesch Canaccord Genuity (212) 389-8094 / (212) 389-8095 rmeliker@canaccordgenuity.com / mkodesch@canaccordgenuity.com
Thomas Lesnick / Ryan Wineman Capital One (571) 633-8191 / (571) 633-8414 thomas.lesnick@capitalone.com / ryan.wineman@capitalone.com
Michael Bilerman / Nick Joseph Citigroup Equity Research (212) 816-1383 / (212) 816-1909 michael.bilerman@citi.com / nicholas.joseph@citi.com
Vincent Chao / Vlad Rudnytsky Deutsche Bank Securities, Inc. (212) 250-6799 / (212) 250-6090 vincent.chao@db.com / vlad.rudnytsky@db.com
Steve Sakwa / Gwen Clark Evercore ISI (212) 446-9462 / (212) 446-5611 steve.sakwa@evercoreisi.com / gwen.clark@evercoreisi.com
David Corak FBR & Co. (703) 312-1610 dcorak@fbr.com
Andrew Rosivach / Jeff Pehl Goldman Sachs (212) 902-2796 / (212) 357-4474 andrew.rosivach@gs.com / jeffrey.pehl@gs.com
Ryan Burke Green Street Advisors (949) 640-8780 rburke@greenst.com
Carol Kemple Hilliard Lyons (502) 588-1839 ckemple@hilliard.com
Aaron Hecht JMP Securities (415) 835-3963 ahecht@jmpsecurities.com
Anthony Paolone / Emil Shalmiyev J.P. Morgan Securities (212) 622-6682 / (212) 622-6615 anthony.paolone@jpmorgan.com / emil.shalmiyev@jpmorgan.com
Jordan Sadler / Austin Wurschmidt KeyBanc Capital Markets (917) 368-2280 / (917) 368-2311 jsadler@keybanccm.com / awurschmidt@key.com
Drew Babin Robert W. Baird & Co. (215) 553-7816 dbabin@rwbaird.com
Alexander Goldfarb / Daniel Santos Sandler O'Neill + Partners, L.P. (212) 466-7937 / (212) 466-7927 agoldfarb@sandleroneill.com / dsantos@sandleroneill.com
American Campus Communities, Inc. is followed by the analysts listed above. Please note that any opinions, estimates or forecasts regarding American Campus Communities, Inc.'s
performance made by such analysts are theirs alone and do not represent the opinions, forecasts or predictions of the company or its management. American Campus Communities,
Inc. does not by its reference above or distribution imply its endorsement of or concurrence with such information, conclusions or recommendations.
22
Forward-looking Statements
In addition to historical information, this supplemental package contains forward-looking statements under the federal
securities law. These statements are based on current expectations, estimates and projections about the industry
and markets in which American Campus operates, management's beliefs, and assumptions made by management.
Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties,
which are difficult to predict.