CCG NAREIT November 2011 Investor Presentation

8/3/2019 CCG NAREIT November 2011 Investor Presentation

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August 2010

Investor PresentationSeptember 2011

NAREIT Investor PresentationNovember 2011


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This presentation contains certain forward-looking statements that are subject to risks and uncertainties.These forward-looking statements are based on certain assumptions, discuss future expectations,describe future plans and strategies, contain financial and operating projections or state other forward-looking information. TheCompanys ability to predict results or the actual effect of future events, actions,plans or strategies is inherently uncertain. Although the Company believes that the expectations reflectedin such forward-looking statements are based on reasonable assumptions, theCompanys actual resultsand performance could differ materially from those set forth in, or implied by, the forward-lookingstatements. You are cautioned not to place undue reliance on any of these forward-looking statements,which reflect theCompanys views on this date. Furthermore, except as required by law, the Company is

under no duty to, and does not intend to, update any of our forward-looking statements after this date,whether as a result of new information, future events or otherwise.

This presentation does not constitute, and may not be used in connection with, an offer or solicitation byanyone in any jurisdiction in which such offer or solicitation is not permitted by law or in which the personmaking the offer or solicitation is not qualified to do so or to any person to whom it is unlawful to makesuch offer or solicitation.

Forward Looking Statements


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Investment Highlights

The Groveat Troy, AL

The Groveat MobilePhase I, AL

Strengthening Operations

Standardized Brand and Building Design

Vertically Integrated Enterprise

Conservative Capital Structure

Attractive Valuation

Experienced Management Team


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National Footprint of High-Quality Assets

(1) As of September 30, 2011. Includes 21 wholly-owned, 6 joint venture and 6 new development properties that opened in August 2011

(2) As of September 30, 2011. Includes 21 wholly-owned and 6 joint venture properties, but excludes 6 new developments delivered inAugust 2011

Operating Portfolio Highlights

33

6,324 / 17,064

2.7 years

0.7 miles

91.2%

Properties (1)

Total Units / Beds (1)

Weighted Average Age (1)

Average Distance to Campus (1)

Occupancy for 2011/12 (2)


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Accomplishments Since IPO

Completed 6 new developments on time and on budget for 2011/2012 AY

Expect average initial development yield of greater than 7.25%

Launched 6 new projects for delivery in August 2012

Expect average initial development yield of 7.50% - 8.00%

Development Pipeline

Added new senior management and instituted central purchasing and other cost controls,

which drive margin expansion

Established a roving management team to ensure continuity at the property-level

Operational Initiatives

Accessed multiple capital sources to preserve financial flexibility and liquidity

Expanded and converted revolver to an unsecured facility

Secured $48.5 million 7-year Freddie Mac financing

Maintained conservative leverage

Financing &Capital Structure

Achieved 91.2% occupancy(1) for 2011/2012 AY, a 260bp improvement from 2010/2011

Reported 3.2% rental rate growth(1) for 2011/2012 leasing

Developed an updated comprehensive leasing incentive and tracking program

Focus on Leasing

(1) As of September 30, 2011. Includes 21 wholly-owned and 6 joint venture properties, but excludes 6 new developments delivered inAugust 2011


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Apartment Features:

Private bedrooms with keyed locks

En suite bathrooms

Full furnishings and full kitchens

Modern appliances and washers/dryers

State-of-the-art technology

Ample parking

Gated entrances

On-Site Amenities:

Resort-style swimming pools

Basketball and volleyball courts

Game rooms and coffee bars

Fitness centers

Community clubhouses

All of our apartment communities offer bed-bath parity, attractively furnished unitsand a variety of on-site amenities designed to appeal to the college lifestyle

All Properties are Attractive and Amenity-Rich


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Property Management Refining and Improving the Process

Standardized product allows for:

Systematic management

Strength in centralized purchasingthat improves margins

Area management with formulaicallocation of responsibilities based onproperty scoring

Proprietary standardized operatingprograms and procedures combined with

local market adaptations

Maximizes leasing & operationalefficiencies

HQ

AreaManager

GeneralManager

SalesManager

MITs

MaintenanceManager

CommunityAssistants (9)

Area SalesManager

RovingGeneral

Managers

Roving SalesManagers

Management career ladder" approach

to talent development createsframework for organic internal sourcingof talent


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At The Grove, we offer a fully-loaded college living experience through ourconsistent branding and operating philosophy

Consistent and Efficient Branding & Marketing

Our properties are universally branded The Grove


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Number of 2011-2012 Leases 2010-2011 Leases Rental Rate

Property Properties Units Beds Signed(1)

% Signed(1)

% % Increase(2)

Wholly-Owned 21 3,920 10,528 9,605 91.2% 9,317 88.5% 2.8%

Joint Venture Properties 6 1,128 3,052 2,781 91.1% 2,719 89.1% 4.9%

Sub Total All Operating Properties 27 5,048 13,580 12,386 91.2% 12,036 88.6% 3.2%

New Developments (2011 Deliveries) 6 1,276 3,484 2,770 79.5% n/a n/a n/a

Total Portfolio 33 6,324 17,064 15,156 88.8% 12,036 88.6% 3.2%

Leasing and Rate Improvement for Academic Year 2011/2012

(1) As of September 30, 2011 and September 30, 2010, respectively(2) Average effective rate for 2011/2012 compared to average rate achieved in 2010/2011

Portfolio Leasing and Rate Status for 2011/2012 Academic Year

Increased operating portfolio occupancy by 260 basis points and rental rateby 3.2% year-over-year


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September 30, 2011 September 30, 2010 % Change

Total RevPOB (rental and service) $480 $480 0.0%

Average Occupancy 88.8% 88.2% 0.6%

NOI ($000s) $19,917 $18,425 8.1%

NOI Margin 51.8% 48.2% 3.6%

Strengthening Fundamentals at the Company Portfolio

9-Months Results of Same-Store Wholly-Owned Operations(1)

Continued focus on rate, expense management and occupancygrowth will drive NOI growth

(1) Represents 20 properties, as detailed in the Third Quarter 2011 Supplemental Informationpackage


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Further Operational Opportunities

Tiered pricing within projects based

upon desirability of rooms/ units

Cross branding

Strategic alliance

Increased wallet share

Convenience

Leading Resident Life program

The Groveat San Angelo, TX

The Groveat Jacksonville, AL


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Budgets constrain on-campus housing investment

38 states cut their educational budgets

during the recession

Existing on-campus housing stock becoming

increasingly obsolete

Lack of construction financing is restricting newentrants

Compelling Market Dynamics

Echo Boom drives enrollment growth

Increasing percentage of high-school graduates

attending college

Increasing foreign enrollments

Increasing percentage of full-time vs. part-time

students

Students taking longer to graduate

College Enrollments (1957-2012)

0

2

4

6

8

10

12

14

16

18

20

22

1950 1963 1973 1983 1993 2003 2013

DemandDrivers

SupplyFactors

Echo BoomEnrolling in College

Baby BoomEnrolling in College

Source: Dept. of Education, National Center for Educational Statistics

(millions)

Enrollment expected to increase by ~1.5 million students over the next 8 years


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Why Our Markets

Well-established university markets with protective community councils

Superior land acquisition and entitlement capabilities

Lack of available financing for local operators

Higher Barriers to Entry

On-campus atmosphere with advantages of off-campus economics

Benefits from symbiotic relationships with universities

Greater impact from marketing dollars

Unique Relationshipswith Universities

We are able to build a superior product at a lower cost because of our captive

general contractor and wholesale purchaser

Construction CostAdvantage

Our markets benefit from higher enrollment growth than primary markets

9.5% enrollment growth in our markets over four academic years

Stronger EnrollmentGrowth


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Traditional on-campus, dormitory-style housing alternatives have generallyconsisted of shared rooms, communal bathroom facilities and extremely limited (if

any) amenities and parking

The Evolution of Student Housing The Dormitory Era


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The Evolution of Student Housing Our Student Housing

Purpose-built student housing is specifically designed to appeal to modern-daycollege students with broad on-site amenities, enhanced privacy and a focus on the

overall lifestyle experience


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Disciplined Development Process

Site acquisition based upon on-the-ground diligence and solid research

Majority not actually for sale

Development site selection criteria:

High enrollment growth colleges/universities

Limited competing product

Proximity to campus

Track record of 33 projects,equating to over $620 million of

investment

Solid pipeline for growth

We utilize a proprietary underwriting model with over 60 inputs to evaluate the relativeattractiveness of each market, which we then use to prioritize development opportunities


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2012/2013 Academic Year Development Projects

($ in thousands)

In addition to those listed above, we have identified 200+ potentialmarkets and are conducting due diligence on 80 sites

(1) All data is as of fall 2011 except for Northern Arizona University, which is as of fall 2010; from school websites

(2) Total Enrollmentand Distance to Campusare averages(3) Acquisition of existing community with 138 units and 384 beds. New development adds 68 units and 228 beds

2012/2013 Academic Year Developments

Project University Served

Total

Enrollment(1)

Distance toCampus

(miles) Units Beds

Est. Cost

($mm)

Wholly-Owned

The Grove at Auburn Auburn University 25,469 0.1 216 600 $26.3

The Grove at Flagstaff Northern Arizona Univ. 17,529 0.3 216 584 33.1

The Grove at Orono University of Maine 11,168 0.5 188 620 25.3

Average/Sub Total(2) 18,055 0.3 620 1,804 $84.7

Joint Venture

The Grove at Fayetteville University of Arkansas 23,199 0.5 232 632 $26.5

The Grove at Laramie University of Wyoming 10,568 0.3 224 612 24.8

The Grove at Stillwater(3)

Oklahoma State Univ. 22,411 0.8 206 612 20.7

Average/Sub Total(2)

18,726 0.5 662 1,856 $72.1

Average/ Total(2)

18,391 0.4 1,282 3,660 $156.8


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Integrated Construction & Supply Structure

We have built the same prototypical building over 500 times

Continually refining design

Captive general contractor

Control cost, quality, timing

Captive wholesale supply

Volume purchasing

Cost is ~$43 per sq. ft.

We benefit from the experience and efficiencies of our standardizedbuilding design


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-

$100

$200

$300

$400

$500

$600

$700

9/30/2011

Capital Structure (Including Pro Rata Share of JointVenture Debt)

($ in millions)

EquityPro Rata Share of JV DebtDebt

$579.5

(1) From December 31, 2010 to September 30, 2011; excludes construction loans

41.5%

Enhanced Capital Structure

Extended average term to maturity of debt from 4.6 to

5.4 years while decreasing the average cost of debt from

4.8% to 4.5%(1)

Refinanced credit facility in 3Q 2011

Converted to unsecured facility

Increased size to $150mm Decreased spread over LIBOR by 100 bps

Lengthened term by approximately a year

More attractive covenant package

Demonstrated access to agency financing with inaugural

Freddie Mac $48.5mm financing

Obtained construction loans for all new development

projects

Refinanced three joint venture construction loans with a

term loan and received an additional commitment on

three others

Prudent Capital Structure


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$46.0

$14.8$48.5

$26.4

$2.6

$5.1

$109.0

$0.0

$41.5

$31.5

$13.4

$41.0

$150.0

0.0%

17.3%

30.5%

36.1%

53.2%

72.5%

78.7%

100.0%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

$0.0

$20.0

$40.0

$60.0

$80.0

$100.0

$120.0

$140.0

$160.0

2011 2012 2013 2014 2015 2016 2017 Thereafter

Mortgage Debt Construction Loans ProRata Share of JV Debt Senior Unsecured Revolver

$51.1

Well-Managed Debt Maturities

($ in millions, except per share data)

(1)

Note: $2.6mm of debt classified as construction debt above represents other debt that matures in 2031(1) Assumes extension option is exercised

(2) Pro forma for a $38.5 million term loan that closed in October 2011; proceeds were used to pay down three construction loansdue in 2011 and 2012. The Company has a commitment for an additional term loan to take out three other construction loansdue in 2012

(2)


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(1) SNL consensus estimates(2) Green Street Research nominal cap rate estimates(3) CCG includes pro rata share of Joint Venture beds 14,601 beds; ACC excludes beds from On-Campus Participating Properties 57,968 beds; EDR excludes

announced acquisitions of GrandMarc at Westberry Place and Irish Row as these have not closed 19,774 beds

24.5x

20.8x

13.4x

0.0x

5.0x

10.0x

15.0x

20.0x

25.0x

30.0x

EDR ACC CCG

6.6%

3.3%3.1%

0.0%

2.0%

4.0%

6.0%

8.0%

CCG EDR ACC

Implied Cap Rate(2)Price/2011E FFO(1)

Dividend YieldEnterprise Value/Bed(3)

Source: Public filings and research reportsNote: Closing price as of 11/10/2011

$66.4

$50.0

$36.6

$25.0

$35.0

$45.0

$55.0

$65.0

$75.0

ACC EDR CCG

7.8%

6.0%

5.3%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

CCG EDR ACC

($ in thousands)


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Experienced Leadership Team

*Ted W. RollinsCo-Founder, Co-Chairman ofthe Board & Chief ExecutiveOfficer

25 years of real estate experience developing and operating service-enriched housing properties

Founded Campus Crest in 2004

*Michael S. HartnettCo-Founder, Co-Chairman ofthe Board & Chief InvestmentOfficer

25 years of real estate experience developing and operating service-enriched housing properties

Founded Campus Crest in 2004

Over 33 years of experience in service driven businesses; Colonel in U.S. Army Special Forces

Joined Campus Crest as a consultant in 2009

Earl C. HowellPresident & Chief OperatingOfficer

Over 20 years in corporate accounting and senior financial positions at both private and public

companies and Deloitte & Touche LLP

Joined Campus Crest in 2008

*Donnie L. BobbittExecutive Vice President &Chief Financial Officer

Robert M. DannExecutive Vice President &President of CCREM & CCD

25-year industry veteran with significant experience in strategic planning, portfolio and asset management andoperational execution


Brian L. SharpeExecutive Vice President &President of CCC

Over 30 years of construction experience including acting as the driving force behind companys product

development and development of the General Contractor unit that delivers one of the lowest costs in the industry,combined with high quality


* Denotes present at NAREIT


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Investment Highlights

The Groveat Troy, AL

Strengthening Operations

Standardized Brand and Building Design

Vertically Integrated Enterprise

Conservative Capital Structure


Experienced Management Team

CCG NAREIT November 2011 Investor Presentation

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