American Campus Communities (ACC), a student housing community developer, announced this week that it had completed its due diligence in the acquisition of 15 student housing properties for $627 million. Expected to close in the third quarter, ACC will buy the properties from affiliates of Campus Acquisitions LLC. The acquisition consideration consists of the assumption of approximately $231.6 million of outstanding mortgage debt, the issuance of between $15 million and $50 million in the form of units of common limited partnership interest in ACC's operating partnership, and between $345.4 million and $380.4 million in cash, with the final allocation between the unit and cash consideration to be determined by Campus Acquisitions prior to closing. ACC intends to fund the cash portion of the purchase price with available cash, borrowings under its revolving credit facility, a bridge loan facility and/or the sale of debt or equity securities, according to a GlobeSt.com article.
Bill Bayless, CEO of American Campus, commented, "We are very pleased to be adding 15 properties to the ACC portfolio that meet our investment criteria of differentiated communities close to campus in submarkets with barriers to entry. This acquisition should provide us a significant opportunity for meaningful accretion in asset value, operational upside, efficiencies with 11 of the assets located in our existing markets, plus new business prospects with the entry into four new tier one collegiate markets. We believe the highly fragmented student housing industry is ripe for consolidation and we are well positioned to execute on strategic opportunities."
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