Austin, Texas — American Campus Communities has announced financial results for the second quarter of 2020. Revenue for the second quarter totaled $185.5 million, versus $217.4 million in the second quarter of 2019. The company reported a net loss of $13.3 million or $0.10 per fully diluted share, versus a net income of $10.4 million or $0.07 per fully diluted share in the second quarter of 2019.
Same store net operating income decreased by 20.9 percent versus the second quarter of 2019. Revenues decreased 14.2 percent during this time and operating expenses decreased 5.7 percent as compared to the prior year.
Through its COVID-19 resident hardship program, the company provided $8.6 million in direct financial relief to its residents suffering financial hardship and an additional $15.1 million in rent relief to students through its university partnerships. In addition to this $23.7 million in financial assistance, the company waived all late fees, online payment fees and did not pursue any financial related evictions.
At the company’s off-campus communities and on-campus 12-month apartment communities, an average of 93.7 percent of residents made their rent payments during the quarter. Same store revenue was impacted by approximately $30.6 million of rent relief, lost revenues from summer camps and conferences, increased uncollectible accounts, waived fees and other COVID-19-related items.
As of July 19, The Chronicle of Higher Education reported that 63 of the 68 universities served by the company’s communities are planning for a return to in-person classes or a hybrid in-person model for fall 2020, while only five are planning for primarily online classes. As of July 17, the company’s same store owned portfolio was 90.1 percent preleased for the 2020-2021 academic year, as compared to 93.5 percent preleased on the same date during the prior year.
During the second quarter, ACC delivered the first phase of its Disney College Program project on schedule and within budget. Due to the COVID-19-related temporary suspension of the Disney College Program, initial occupancy is expected upon reinstatement of the program. The company also issued $400 million of 10-year senior unsecured notes at a yield of 3.97 percent, with the proceeds used to repay borrowings under the company’s revolving credit facility.
“Throughout this pandemic, we have strived to do the right thing by our stakeholders and continued to follow the eight principle objectives we laid out at the beginning of this crisis,” says Bill Bayless, CEO of the Austin-based company. “We are pleased with our progress in relation to all of these guiding principles. As we expected and communicated on the last earnings call, this quarter was significantly impacted by the short term financial impacts of the COVID-19 pandemic, largely driven by our commitment to responsibly manage our business with compassion towards those residents and families who need financial assistance during these challenging times, with nearly $24 million in financial relief given during the quarter.”
“While we anticipate that we will continue to have short term financial impacts, over the longer term we are pleased with the progress that we have made in our efforts associated with the fall 2020 lease-up and our outreach to assist universities in their plans to return to some level of in-person curriculum delivery this fall,” continues Bayless. “Although we don’t expect a full return to normalcy in fall 2020, universities are focused on the policies and procedures necessary to promote a safe environment in the delivery of their academic curriculum this fall, and our leasing trends and consumer sentiment at this time make us cautiously optimistic that we are on a path that many would have considered a best-case scenario at the outset of this pandemic.”