Campus Crest Communities Inc (CCG), a real estate investment trust (REIT), recently announced that it is set to offer 6 million shares of its common stock. Campus Crest also plans to provide a 30-day option to the underwriters for purchasing an additional 900,000 shares.
Campus Crest expects to utilize the net proceeds from this offering to acquire the remaining 50.1% stake in The Grove at Moscow, Idaho and the remaining 80.0% ownership interest in The Grove at Valdosta, Georgia for $16.2 million and to repay approximately $27.3 million of mortgage debt secured by these properties. Additionally, the company intends to reduce borrowings outstanding under its revolving credit facility through the proceeds from the transaction and the remainder will be used for general corporate purposes.
Campus Crest reported first quarter 2012 FFO (funds from operations) of 15 cents per share compared with 17 cents per share in the year-earlier quarter. Fund from operations, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income.
Campus Crest is a developer, builder, owner and manager of high-quality, purpose-built student housing properties located close to campuses in targeted U.S. markets. The company rents student housing properties, offers student housing services and provides construction, development, and management services.Campus Crest owns interests in 33 operating student housing properties comprising approximately 6,324 apartment units and 17,064 beds.
Campus Crest currently retains a Zacks #2 Rank, which translates into a short-term Buy rating. We have a long-term Neutral recommendation on the stock. One of its competitors, Education Realty Trust (EDR) carries a Zacks #3 Rank, which translates into a short-term Hold rating.
CAMPUS CREST CM (CCG): Free Stock Analysis Report
EDUCATION RLTY (EDR): Free Stock Analysis Report
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