EXPLANATORY NOTE

This report combines the reports on Form 10-Q for the quarterly period ended ~~June~~September 30, 2020 of American Campus Communities, Inc. and American Campus Communities Operating Partnership LP. Unless stated otherwise or the context otherwise requires, references to “ACC” mean American Campus Communities, Inc., a Maryland corporation that has elected to be treated as a real estate investment trust (“REIT”) under the Internal Revenue Code, and references to “ACCOP” mean American Campus Communities Operating Partnership LP, a Maryland limited partnership. References to the “Company,” “we,” “us” or “our” mean collectively ACC, ACCOP and those entities/subsidiaries owned or controlled by ACC and/or ACCOP. References to the “Operating Partnership” mean collectively ACCOP and those entities/subsidiaries owned or controlled by ACCOP. The following chart illustrates the Company’s and the Operating Partnership’s corporate structure:

The general partner of ACCOP is American Campus Communities Holdings, LLC (“ACC Holdings”), an entity that is wholly-owned by ACC. As of ~~June~~September 30, 2020, ACC Holdings held an ownership interest in ACCOP of less than 1%. The limited partners of ACCOP are ACC and other limited partners consisting of current and former members of management and nonaffiliated third parties. As of ~~June~~September 30, 2020, ACC owned an approximate 99.6% limited partnership interest in ACCOP. As the sole member of the general partner of ACCOP, ACC has exclusive control of ACCOP’s day-to-day management. Management operates the Company and the Operating Partnership as one business. The management of ACC consists of the same members as the management of ACCOP. The Company is structured as an umbrella partnership REIT (“UPREIT”) and ACC contributes all net proceeds from its various equity offerings to the Operating Partnership. In return for those contributions, ACC receives a number of units of the Operating Partnership (“OP Units,” see definition below) equal to the number of common shares it has issued in the equity offering. Contributions of properties to the Company can be structured as tax-deferred transactions through the issuance of OP Units in the Operating Partnership. Based on the terms of ACCOP’s partnership agreement, OP Units can be exchanged for ACC’s common shares on a one-for-one basis. The Company maintains a one-for-one relationship between the OP Units of the Operating Partnership issued to ACC and ACC Holdings and the common shares issued to the public. The Company believes that combining the reports on Form 10-Q of ACC and ACCOP into this single report provides the following benefits:


~~(1)~~	~~enhances investors’ understanding of the Company and the Operating Partnership by enabling investors to view the business as a whole in the same manner as management views and operates the business;~~


~~(2)~~	~~eliminates duplicative disclosure and provides a more streamlined and readable presentation since a substantial portion of the disclosure applies to both the Company and the Operating Partnership; and~~


~~(3)~~	~~creates time and cost efficiencies through the preparation of one combined report instead of two separate reports.~~

(1)enhances investors’ understanding of the Company and the Operating Partnership by enabling investors to view the business as a whole in the same manner as management views and operates the business;

(2)eliminates duplicative disclosure and provides a more streamlined and readable presentation since a substantial portion of the disclosure applies to both the Company and the Operating Partnership; and

(3)creates time and cost efficiencies through the preparation of one combined report instead of two separate reports.

ACC consolidates ACCOP for financial reporting purposes, and ACC essentially has no assets or liabilities other than its investment in ACCOP. Therefore, the assets and liabilities of the Company and the Operating Partnership are the same on their respective financial statements. However, the Company believes it is important to understand the few differences between the

Company and the Operating Partnership in the context of how the entities operate as a consolidated company. All of the Company’s property

ownership, development and related business operations are conducted through the Operating Partnership. ACC also issues public equity from time to time and guarantees certain debt of ACCOP, as disclosed in this report. ACC does not have any indebtedness, as all debt is incurred by the Operating Partnership. The Operating Partnership holds substantially all of the assets of the Company, including the Company’s ownership interests in its joint ventures. The Operating Partnership conducts the operations of the business and is structured as a partnership with no publicly traded equity. Except for the net proceeds from ACC’s equity offerings, which are contributed to the capital of ACCOP in exchange for OP Units on a one-for-one common share per OP Unit basis, the Operating Partnership generates all remaining capital required by the Company’s business. These sources include, but are not limited to, the Operating Partnership’s working capital, net cash provided by operating activities, borrowings under its credit facility, the issuance of unsecured notes, and proceeds received from the disposition of certain properties. Noncontrolling interests, stockholders’ equity, and partners’ capital are the main areas of difference between the consolidated financial statements of the Company and those of the Operating Partnership. The noncontrolling interests in the Operating Partnership’s financial statements consist of the interests of unaffiliated partners in various consolidated joint ventures. The noncontrolling interests in the Company’s financial statements include the same noncontrolling interests at the Operating Partnership level and OP ~~Unit holders~~unitholders of the Operating Partnership. The differences between stockholders’ equity and partners’ capital result from differences in the equity issued at the Company and Operating Partnership levels.

To help investors understand the significant differences between the Company and the Operating Partnership, this report provides separate consolidated financial statements for the Company and the Operating Partnership. A single set of consolidated notes to such financial statements is presented that includes separate discussions for the Company and the Operating Partnership when applicable (for example, noncontrolling interests, stockholders’ equity or partners’ capital, earnings per share or unit, etc.). A combined Management’s Discussion and Analysis of Financial Condition and Results of Operations section is also included that presents discrete information related to each entity, as applicable. This report also includes separate Part I, Item 4 Controls and Procedures sections and separate Exhibits 31 and 32 certifications for each of the Company and the Operating Partnership in order to establish that the requisite certifications have been made and that the Company and the Operating Partnership are compliant with Rule 13a-15 or Rule 15d-15 of the Securities Exchange Act of 1934 and 18 U.S.C. §1350.

In order to highlight the differences between the Company and the Operating Partnership, the separate sections in this report for the Company and the Operating Partnership specifically refer to the Company and the Operating Partnership. In the sections that combine disclosure of the Company and the Operating Partnership, this report refers to actions or holdings as being actions or holdings of the Company. Although the Operating Partnership is generally the entity that directly or indirectly enters into contracts and joint ventures and holds assets and debt, reference to the Company is appropriate because the Company operates its business through the Operating Partnership. The separate discussions of the Company and the Operating Partnership in this report should be read in conjunction with each other to understand the results of the Company on a consolidated basis and how management operates the Company.

FORM 10-Q

FOR THE QUARTER ENDED ~~June~~September 30, 2020

TABLE OF CONTENTS


			PAGE NO.

PART I.

		~~PAGE NO.~~

~~PART I.~~

Item 1.	Consolidated Financial Statements of American Campus Communities, Inc. and Subsidiaries:

		Consolidated Balance Sheets as of ~~June~~September 30, 2020 (unaudited) and December 31, 2019	1

		Consolidated Statements of Comprehensive Income for the three and ~~six~~nine months ended ~~June~~September 30, 2020 and 2019 (all unaudited)	2

		Consolidated Statements of Changes in Equity for the three months ended March 31, 2020 and 2019, June 30, 2020 and ~~June~~2019, and September 30, 2020 and 2019 (all unaudited)	3

		Consolidated Statements of Cash Flows for the ~~six~~nine months ended ~~June~~September 30, 2020 and 2019 (all unaudited)	5

		Consolidated Financial Statements of American Campus Communities Operating Partnership LP and Subsidiaries:

		Consolidated Balance Sheets as of ~~June~~September 30, 2020 (unaudited) and December 31, 2019	7

		Consolidated Statements of Comprehensive Income for the three and ~~six~~nine months ended ~~June~~September 30, 2020 and 2019 (all unaudited)	8

		Consolidated Statements of Changes in Capital for the three months ended March 31, 2020 and 2019, June 30, 2020 and ~~June~~2019, and September 30, 2020 and 2019 (all unaudited)	9

		Consolidated Statements of Cash Flows for the ~~six~~nine months ended ~~June~~September 30, 2020 and 2019 (all unaudited)	11

		Notes to Consolidated Financial Statements of American Campus Communities, Inc. and Subsidiaries and American Campus Communities Operating Partnership LP and Subsidiaries (unaudited)	13

Item 2.		Management’s Discussion and Analysis of Financial Condition and Results of Operations	3031

Item 3.		Quantitative and Qualitative Disclosure about Market Risk	4647

Item 4.		Controls and Procedures	4647

PART II.

Item 1.		Legal Proceedings	4748

Item 1A.		Risk Factors	4748

Item 2.		Unregistered Sales of Equity Securities and Use of Proceeds	4849

Item 3.		Defaults Upon Senior Securities	4849

Item 4.		Mine Safety Disclosures	4849

Item 5.		Other Information	4849

Item 6.		Exhibits	4950

SIGNATURES			5051

AMERICAN CAMPUS COMMUNITIES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)


	September 30, 2020		December 31, 2019
	(Unaudited)
Assets

Investments in real estate:
Owned properties, net	$	6,704,952	$	6,694,715

On-campus participating properties, net	71,156		75,188
Investments in real estate, net	6,776,108		6,769,903

Cash and cash equivalents	44,449		54,650
Restricted cash	23,528		26,698
Student contracts receivable, net	22,008		13,470
Operating lease right of use assets	458,330		460,857
Other assets	257,101		234,176

Total assets	$	7,581,524	$	7,559,754

Liabilities and equity

Liabilities:
Secured mortgage, construction and bond debt, net	$	740,128	$	787,426

Unsecured notes, net	2,374,680		1,985,603
Unsecured term loans, net	199,385		199,121
Unsecured revolving credit facility	276,700		425,700
Accounts payable and accrued expenses	87,638		88,411
Operating lease liabilities	483,694		473,070
Other liabilities	202,775		157,368
Total liabilities	4,365,000		4,116,699

Commitments and contingencies (Note 13)

Redeemable noncontrolling interests	20,889		104,381

Equity:
American Campus Communities, Inc. and Subsidiaries stockholders’ equity:
Common stock, $0.01 par value, 800,000,000 shares authorized, 137,540,345 and 137,326,824 shares issued and outstanding at September 30, 2020 and December 31, 2019, respectively	1,375		1,373
Additional paid in capital	4,472,489		4,458,456
Common stock held in rabbi trust, 91,746 and 77,928 shares at September 30, 2020 and December 31, 2019, respectively	(3,951)		(3,486)
Accumulated earnings and dividends	(1,292,364)		(1,144,721)
Accumulated other comprehensive loss	(24,614)		(16,946)
Total American Campus Communities, Inc. and Subsidiaries stockholders’ equity	3,152,935		3,294,676
Noncontrolling interests – partially owned properties	42,700		43,998
Total equity	3,195,635		3,338,674

Total liabilities and equity	$	7,581,524	$	7,559,754



Consolidated variable interest entities’ assets and debt included in the above balances:

Investments in real estate, net	$	598,505	$	788,393
Cash, cash equivalents and restricted cash	$	36,635	$	59,908
Other assets	$	15,956	$	18,387
Secured mortgage and construction debt, net	$	412,608	$	418,241
Accounts payable, accrued expenses and other liabilities	$	48,940	$	56,976

June 30, 2020 December 31, 2019
(Unaudited)
Assets

Investments in real estate:
Owned properties, net $ 6,659,939
$ 6,694,715
On-campus participating properties, net 72,273
75,188
Investments in real estate, net 6,732,212
6,769,903

Cash and cash equivalents 31,011
54,650
Restricted cash 29,959
26,698
Student contracts receivable, net 9,194
13,470
Operating lease right of use assets 459,110
460,857
Other assets 253,024
234,176

Total assets $ 7,514,510
$ 7,559,754

Liabilities and equity

Liabilities:

Secured mortgage, construction and bond debt, net $ 747,086
$ 787,426
Unsecured notes, net 2,373,767
1,985,603
Unsecured term loans, net 199,297
199,121
Unsecured revolving credit facility 186,500
425,700
Accounts payable and accrued expenses 72,335
88,411
Operating lease liabilities 482,492
473,070
Other liabilities 161,091
157,368
Total liabilities 4,222,568
4,116,699

Commitments and contingencies (Note 12)

Redeemable noncontrolling interests 20,912
104,381

Equity:

American Campus Communities, Inc. and Subsidiaries stockholders’ equity:

Common stock, $0.01 par value, 800,000,000 shares authorized, 137,540,345 and 137,326,824 shares issued and outstanding at June 30, 2020 and December 31, 2019, respectively 1,375
1,373
Additional paid in capital 4,469,251
4,458,456
Common stock held in rabbi trust, 91,746 and 77,928 shares at June 30, 2020 and December 31, 2019, respectively (3,951 ) (3,486 )
Accumulated earnings and dividends (1,207,645 ) (1,144,721 )
Accumulated other comprehensive loss (26,465 ) (16,946 )
Total American Campus Communities, Inc. and Subsidiaries stockholders’ equity 3,232,565
3,294,676
Noncontrolling interests – partially owned properties 38,465
43,998
Total equity 3,271,030
3,338,674

Total liabilities and equity $ 7,514,510
$ 7,559,754

Consolidated variable interest entities’ assets and debt included in the above balances:

Investments in real estate, net $ 591,263
$ 788,393
Cash, cash equivalents and restricted cash $ 36,988
$ 59,908
Other assets $ 14,818
$ 18,387
Secured mortgage and construction debt, net $ 417,248
$ 418,241
Accounts payable, accrued expenses and other liabilities $ 40,071
$ 56,976

See accompanying notes to consolidated financial statements.

AMERICAN CAMPUS COMMUNITIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(unaudited, in thousands, except share and per share data)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Revenues:
Owned properties	$	191,710	$	211,082	$	600,987	$	638,657
On-campus participating properties	5,386		6,944		20,196		24,788
Third-party development services	2,186		5,611		5,531		12,389
Third-party management services	2,771		3,342		9,268		9,118
Resident services	622		726		1,644		2,255
Total revenues	202,675		227,705		637,626		687,207

Operating expenses (income):
Owned properties	106,518		111,836		284,741		294,768
On-campus participating properties	3,783		3,822		10,357		11,585
Third-party development and management services	5,061		5,430		16,245		14,129
General and administrative	8,638		7,165		28,563		22,595
Depreciation and amortization	67,369		68,930		199,979		206,500
Ground/facility leases	3,071		3,215		10,033		10,000
(Gain) loss from disposition of real estate	0		0		(48,525)		282
Provision for impairment	0		0		0		3,201

Total operating expenses	194,440		200,398		501,393		563,060

Operating income	8,235		27,307		136,233		124,147

Nonoperating income (expenses):
Interest income	855		960		2,576		2,855
Interest expense	(29,056)		(28,303)		(84,007)		(82,432)
Amortization of deferred financing costs	(1,349)		(1,315)		(3,891)		(3,665)
Gain (loss) from extinguishment of debt	0		20,992		(4,827)		20,992
Other nonoperating income	264		0		264		0
Total nonoperating expenses	(29,286)		(7,666)		(89,885)		(62,250)

(Loss) income before income taxes	(21,051)		19,641		46,348		61,897
Income tax provision	(373)		(305)		(1,133)		(983)
Net (loss) income	(21,424)		19,336		45,215		60,914



Net loss (income) attributable to noncontrolling interests	1,909		887		2,781		(665)
Net (loss) income attributable to ACC, Inc. and Subsidiaries common stockholders	$	(19,515)	$	20,223	$	47,996	$	60,249

Other comprehensive income (loss)
Change in fair value of interest rate swaps and other	1,851		(145)		(7,668)		(14,532)
Comprehensive (loss) income	$	(17,664)	$	20,078	$	40,328	$	45,717

Net (loss) income per share attributable to ACC, Inc. and Subsidiaries common shareholders
Basic	$	(0.15)	$	0.14	$	0.34	$	0.43
Diluted	$	(0.15)	$	0.14	$	0.33	$	0.43

Weighted-average common shares outstanding:
Basic	137,632,091		137,403,842		137,574,485		137,259,130
Diluted	137,632,091		138,375,527		138,678,713		138,257,906

Three Months Ended
June 30, Six Months Ended
June 30,
2020 2019 2020
2019
Revenues:
Owned properties $ 177,186
$ 203,156
$ 409,277
$ 427,575
On-campus participating properties 4,101
6,396
14,810
17,844
Third-party development services 1,290
3,607
3,345
6,778
Third-party management services 2,668
3,465
6,497
5,776
Resident services 302
747
1,022
1,529
Total revenues 185,547
217,371
434,951
459,502

Operating expenses (income):

Owned properties 85,749
90,763
178,223
182,932
On-campus participating properties 3,208
3,806
6,574
7,763
Third-party development and management services 4,977
4,513
11,184
8,699
General and administrative 9,767
8,115
19,925
15,430
Depreciation and amortization 66,441
68,815
132,610
137,570
Ground/facility leases 2,893
3,236
6,962
6,785
Loss (gain) from disposition of real estate —
282
(48,525 ) 282
Provision for impairment —
—
—
3,201
Total operating expenses 173,035
179,530
306,953
362,662

Operating income 12,512
37,841
127,998
96,840

Nonoperating income (expenses):

Interest income 870
969
1,721
1,895
Interest expense (27,168 ) (27,068 ) (54,951 ) (54,129 )
Amortization of deferred financing costs (1,255 ) (1,218 ) (2,542 ) (2,350 )
Loss from early extinguishment of debt —
—
(4,827 ) —
Total nonoperating expenses (27,553 ) (27,317 ) (60,599 ) (54,584 )

(Loss) income before income taxes (15,041 ) 10,524
67,399
42,256
Income tax provision (381 ) (314 ) (760 ) (678 )
Net (loss) income (15,422 ) 10,210
66,639
41,578
Net loss (income) attributable to noncontrolling interests 2,078
176
872
(1,552 )
Net (loss) income attributable to ACC, Inc. and Subsidiaries common stockholders $ (13,344 ) $ 10,386
$ 67,511
$ 40,026

Other comprehensive income (loss)

Change in fair value of interest rate swaps and other 282
(8,593 ) (9,519 ) (14,387 )
Comprehensive (loss) income $ (13,062 ) $ 1,793
$ 57,992
$ 25,639

Net (loss) income per share attributable to ACC, Inc. and Subsidiaries common shareholders

Basic and diluted $ (0.10 ) $ 0.07
$ 0.48
$ 0.28

Weighted-average common shares outstanding:

Basic 137,613,560
137,268,696
137,545,365
137,185,576
Diluted 137,613,560
138,243,388
138,652,106
138,198,134

See accompanying notes to consolidated financial statements.

AMERICAN CAMPUS COMMUNITIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(unaudited, in thousands, except share data)


	Common Shares	Par Value of Common Shares		Additional Paid in Capital		Common Shares Held in Rabbi Trust	Common Shares Held in Rabbi Trust at Cost		Accumulated Earnings and Dividends		Accumulated Other Comprehensive (Loss) Income		Noncontrolling Interests – Partially Owned Properties		Total
Equity, December 31, 2019	137,326,824	$	1,373	$	4,458,456	77,928	$	(3,486)	$	(1,144,721)	$	(16,946)	$	43,998	$	3,338,674
Adjustments to reflect redeemable noncontrolling interests at fair value	—	—		9,490		—	—		—		—		—		9,490
Amortization of restricted stock awards	—	—		3,988		—	—		—		—		—		3,988
Vesting of restricted stock awards	199,695	2		(4,157)		—	—		—		—		—		(4,155)
Distributions to common and restricted stockholders and other ($0.47 per common share)	—	—		—		—	—		(65,242)		—		—		(65,242)

Distributions to noncontrolling interests - partially owned properties	—	—		—		—	—		—		—		(2,566)		(2,566)


Change in fair value of interest rate swaps and other	—	—		—		—	—		—		(9,801)		—		(9,801)

Deposits to deferred compensation plan, net of withdrawals	(3,488)	—		129		3,488	(129)		—		—		—		—
Net income	—	—		—		—	—		80,855		—		895		81,750
Equity, March 31, 2020	137,523,031	$	1,375	$	4,467,906	81,416	$	(3,615)	$	(1,129,108)	$	(26,747)	$	42,327	$	3,352,138
Adjustments to reflect redeemable noncontrolling interests at fair value	—	—		(3,410)		—	—		—		—		—		(3,410)
Amortization of restricted stock awards and vesting of restricted stock units	27,644	—		4,439		—	—		—		—		—		4,439
Vesting of restricted stock awards	—	—		(20)		—	—		—		—		—		(20)
Distributions to common and restricted stockholders and other ($0.47 per common share)	—	—		—		—	—		(65,193)		—		—		(65,193)

Distributions to noncontrolling interests - partially owned properties	—	—		—		—	—		—		—		(1,816)		(1,816)


Change in fair value of interest rate swaps and other	—	—		—		—	—		—		282		—		282


Deposits to deferred compensation plan, net of withdrawals	(10,330)	—		336		10,330	(336)		—		—		—		—
Net loss	—	—		—		—	—		(13,344)		—		(2,046)		(15,390)
Equity, June 30, 2020	137,540,345	$	1,375	$	4,469,251	91,746	$	(3,951)	$	(1,207,645)	$	(26,465)	$	38,465	$	3,271,030
Adjustments to reflect redeemable noncontrolling interests at fair value	—	—		(264)		—	—		—		—		—		(264)
Amortization of restricted stock awards	—	—		3,502		—	—		—		—		—		3,502

Distributions to common and restricted stockholders and other ($0.47 per common share)	—	—		—		—	—		(65,204)		—		—		(65,204)
Contributions by noncontrolling interests - partially owned properties	—	—		—		—	—		—		—		6,110		6,110
Distributions to noncontrolling interests - partially owned properties	—	—		—		—	—		—		—		(18)		(18)


Change in fair value of interest rate swaps and other	—	—		—		—	—		—		1,851		—		1,851


Net loss	—	—		—		—	—		(19,515)		—		(1,857)		(21,372)
Equity, September 30, 2020	137,540,345	$	1,375	$	4,472,489	91,746	$	(3,951)	$	(1,292,364)	$	(24,614)	$	42,700	3,195,635

Common
Shares

Par Value of
Common
Shares

Additional Paid
in Capital
Common Shares Held in Rabbi Trust Common Shares Held in Rabbi Trust at Cost
Accumulated
Earnings and
Dividends

Accumulated
Other
Comprehensive
(Loss) Income

Noncontrolling
Interests –
Partially Owned
Properties
Total
Equity, December 31, 2019 137,326,824
$ 1,373
$ 4,458,456
77,928
$ (3,486 ) $ (1,144,721 ) $ (16,946 ) $ 43,998
$ 3,338,674
Adjustments to reflect redeemable noncontrolling interests at fair value —
—
9,490
—
—
—
—
—
9,490
Amortization of restricted stock awards —
—
3,988
—
—
—
—
—
3,988
Vesting of restricted stock awards 199,695
2
(4,157 ) —
—
—
—
—
(4,155 )
Distributions to common and restricted stockholders and other ($0.47 per common share) —
—
—
—
—
(65,242 ) —
—
(65,242 )
Distributions to noncontrolling interests - partially owned properties —
—
—
—
—
—
—
(2,566 ) (2,566 )
Change in fair value of interest rate swaps and other —
—
—
—
—
—
(9,801 ) —
(9,801 )
Deposits to deferred compensation plan, net of withdrawals (3,488 ) —
129
3,488
(129 ) —
—
—
—
Net income —
—
—
—
—
80,855
—
895
81,750
Equity, March 31, 2020 137,523,031

$ 1,375

$ 4,467,906
81,416
$ (3,615 )
$ (1,129,108 )
$ (26,747 )
$ 42,327

$ 3,352,138
Adjustments to reflect redeemable noncontrolling interests at fair value —
—
(3,410 ) —
—
—
—
—
(3,410 )
Amortization of restricted stock awards and vesting of restricted stock units 27,644
—
4,439
—
—
—
—
—
4,439
Vesting of restricted stock awards —
—
(20 ) —
—
—
—
—
(20 )
Distributions to common and restricted stockholders and other ($0.47 per common share) —
—
—
—
—
(65,193 ) —
—
(65,193 )
Distributions to noncontrolling interests - partially owned properties —
—
—
—
—
—
—
(1,816 ) (1,816 )
Change in fair value of interest rate swaps and other —
—
—
—
—
—
282
—
282
Deposits to deferred compensation plan, net of withdrawals (10,330 ) —
336
10,330
(336 ) —
—
—
—
Net loss —
—
—
—
—
(13,344 ) —
(2,046 ) (15,390 )
Equity, June 30, 2020 137,540,345
$ 1,375
$ 4,469,251
91,746
$ (3,951 ) $ (1,207,645 ) $ (26,465 ) $ 38,465
$ 3,271,030

See accompanying notes to consolidated financial statements.


Accounting Standards Update		Effective Date

~~Accounting Standards Update~~	~~Effective Date~~

ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes"	January 1, 2021
ASU 2020-06, “Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity"		January 1, 2022

Recently Adopted Accounting Pronouncements

In June 2016, the FASB issued ASU 2016-13, “Financial Instruments-Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments.” The standard requires entities to estimate a lifetime expected credit loss for most financial assets, including trade and other receivables, held-to-maturity debt securities, loans and other financial instruments, and to present the net amount of the financial instrument expected to be collected. In November 2018, the FASB issued ASU 2018-19, “Codification Improvements to Topic 326, Financial Instruments-Credit Losses,” which amends the transition requirements and scope of ASU 2016-13 and clarifies that receivables arising from operating leases are not within the scope of the credit losses standard, but rather, should be accounted for in accordance with ~~the leases standard.~~Accounting Standards Codification 842, Leases. The Company adopted ASU 2016-13 on January 1, 2020.

The Company notes that a majority of its financial instruments result from operating leasing transactions, which as mentioned above, are not within the scope of the new standard. However, the Company did perform both a quantitative and qualitative analysis on the financial assets that are covered under this guidance, including its loans receivable. Based on this analysis, which included analyzing historical performance, occupancy rates, projected future performance, and macroeconomic trends, the Company concluded this new standard did not have a material impact on the consolidated financial statements.

In addition, on January 1, 2020, the Company adopted the following accounting pronouncements which did not have a material effect on the Company’s consolidated financial statements:

AMERICAN CAMPUS COMMUNITIES, INC. AND SUBSIDIARIES

AMERICAN CAMPUS COMMUNITIES OPERATING PARTNERSHIP LP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

•ASU 2018-15, “Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract”

~~AMERICAN CAMPUS COMMUNITIES, INC. AND SUBSIDIARIES~~

~~AMERICAN CAMPUS COMMUNITIES OPERATING PARTNERSHIP LP AND SUBSIDIARIES~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(unaudited)~~

•ASU 2018-13, “Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement”

In April 2020, the FASB issued a Staff Question & Answer (“Q&A”) which was intended to reduce the challenges of evaluating the enforceable rights and obligations of leases for concessions granted to lessees in response to the novel coronavirus disease (“COVID-19”), which was characterized on March 11, 2020 by the World Health Organization as a pandemic. Prior to this guidance, the Company was required to determine, on a lease by lease basis, if a lease concession should be accounted for as a lease modification, potentially resulting in any lease concessions granted being recorded as a reduction to revenue on a straight-line basis over the remaining terms of the leases. The Q&A allows both lessors and lessees to bypass this analysis and elect not to evaluate whether concessions provided in response to the COVID-19 pandemic are lease modifications. This relief is subject to certain conditions being met, including ensuring the total remaining lease payments are substantially the same or less as compared to the original lease payments prior to the concession being granted. The Company ~~as lessor,~~ has elected to apply such relief and will therefore not evaluate if lease concessions that were granted in response to the COVID-19 pandemic meet the definition of a lease modification. Accordingly, the Company accounted for qualifying rent concessions as negative variable lease payments, which reduced revenue or ground lease expense from such leases in the period the concessions were granted. ~~The Company, as a lessee, has not received any concessions under its ground or other lease agreements resulting from the COVID-19 pandemic.~~

Interim Financial Statements

The accompanying interim financial statements are unaudited but have been prepared in accordance with GAAP for interim financial information and in conjunction with the rules and regulations of the SEC. Accordingly, they do not include all disclosures required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting solely of normal recurring matters) necessary for a fair presentation of the financial statements of the Company for these interim periods have been included. Because of the seasonal nature of the Company’s operations, the results of operations and cash flows for any interim period are not necessarily indicative of results for other interim periods or for the full year. These financial statements should be read in conjunction with the financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019.

Restricted Cash

Restricted cash consists of funds held in trust and invested in low risk investments, generally consisting of government backed securities, as permitted by the indentures of trusts, which were established in connection with three bond issues for the Company’s on-campus participating properties. Additionally, restricted cash includes escrow accounts held by lenders and resident security deposits, as required by law in certain states. Restricted cash also consists of escrow deposits made in connection with potential property acquisitions and development opportunities. These escrow deposits are invested in interest-bearing accounts at federally-insured banks. Realized and unrealized gains and losses are not material for the periods presented.

Leasing Revenue

The Company’s primary business involves leasing properties to students under agreements that are classified as operating leases, and which have terms of 12 months or less. These student leases do not provide for variable rent payments. The Company is also a lessor under commercial leases at certain owned properties, some of which provide for variable lease payments based upon tenant performance such as a percentage of sales. The Company recognizes the base lease payments provided for under the leases on a straight-line basis over the lease term, and variable payments are recognized in the period in which the changes in facts and circumstances on which the variable payments are based occur. Lease income under both student and commercial leases is included in owned property revenues in the accompanying consolidated statements of comprehensive income. Lease income under student and commercial leases ~~totaled $176.9 million and $194.3 million for~~is presented in the ~~three months ended June 30, 2020 and 2019, respectively, and $408.3 million and $416.0 million for the six months ended June 30, 2020 and 2019, respectively.~~ following table:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Student lease income	$	186,561	$	199,771	$	594,851	$	615,774
Commercial lease income	$	2,900	$	3,372	$	9,040	$	9,974

AMERICAN CAMPUS COMMUNITIES, INC. AND SUBSIDIARIES

AMERICAN CAMPUS COMMUNITIES OPERATING PARTNERSHIP LP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

During the three and nine months ended ~~June~~September 30, 2020, through its Resident Hardship Program, the Company provided ~~$8.6~~$4.7 million and $13.3 million, respectively, in rent abatements to its tenants experiencing financial hardship due to COVID-19 and an additional ~~$15.1~~$2.1 million and $17.2 million, respectively, in rent abatements through its University Partnerships. As discussed above, these abatements were recorded as a reduction to Owned Properties Revenue. Also during the ~~three~~nine months ended ~~June~~September 30, 2020, an additional $1.5 million in rent abatements were granted to tenants at the Company’s on-campus participating properties, which are reflected as a reduction to On-campus Participating Properties (“OCPPs”) Revenue. There were no additional rent abatements granted at OCPPs during the three months ended September 30, 2020. The Company also waived all late fees and online payment fees and suspended financial related ~~evictions. Lease income under commercial leases totaled $2.9 million~~evictions during the spring and ~~$3.2 million~~summer terms, and in certain cases continues to do so for the ~~three months ended June 30, 2020 and 2019, respectively, and $6.1 million and $6.6 million for the six months ended June 30, 2020 and 2019, respectively.~~current academic year.

~~AMERICAN CAMPUS COMMUNITIES, INC. AND SUBSIDIARIES~~

~~AMERICAN CAMPUS COMMUNITIES OPERATING PARTNERSHIP LP AND SUBSIDIARIES~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(unaudited)~~

Consolidated VIEs

The Company has investments in various entities that qualify as VIEs for accounting purposes and for which the Company is the primary beneficiary and therefore includes the entities in its consolidated financial statements. These VIEs include the Operating Partnership, 56 joint ventures that own a total of 10 operating properties and a2 land ~~parcel,~~parcels, and 6 properties owned under the on-campus participating property structure. The VIE assets and liabilities consolidated within the Company's assets and liabilities are disclosed at the bottom of the accompanying consolidated balance sheets.

Impairment of Long-Lived Assets

Management assesses whether there has been an impairment in the value of the Company’s investments in real estate whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. As of ~~June~~September 30, 2020, the Company ~~has continued to assess whether~~concluded the global economic disruption caused by ~~the novel coronavirus disease (“COVID-19”),~~COVID-19, which was characterized on March 11, 2020 by the World Health Organization as a pandemic, was ana potential impairment indicator. ~~The~~For investments in real estate in which the Company ~~examined~~concluded an indicator of impairment existed, it performed a ~~number~~quantitative analysis and concluded that the carrying value of ~~factors including the overall market and economic environment, economic and operating conditions of the Company’s properties, as well as the demand, creditworthiness, and performance~~each investment in real estate was recoverable from the ~~properties’ tenants, and concluded that~~respective estimated undiscounted future cash flows. As a result, there were no impairments of the carrying values of the Company’s investments in real estate as of ~~June~~September 30, 2020.

3. Earnings Per Share

Earnings Per Share – Company

Basic earnings per share is computed using net income attributable to common stockholders and the weighted average number of shares of the Company’s common stock outstanding during the period. Diluted earnings per share reflects common shares issuable from the assumed conversion of American Campus Communities Operating Partnership Units (“OP Units”) and common share awards granted. Only those items having a dilutive impact on basic earnings per share are included in diluted earnings per share.

The following potentially dilutive securities were outstanding for the three and ~~six~~nine months ended ~~June~~September 30, 2020 and 2019, but were not included in the computation of diluted earnings per share because the effects of their inclusion would be anti-dilutive.


	Three Months Ended September 30,		Nine Months Ended September 30,
	2020	2019	2020	2019
Common OP Units (Note 9)	468,475	468,475	468,475	552,221
Preferred OP Units (Note 9)	35,242	35,242	35,242	44,843
Unvested restricted stock awards (Note 10)	1,099,256	0	0	0
Total potentially dilutive securities	1,602,973	503,717	503,717	597,064

Three Months Ended
June 30, Six Months Ended
June 30,
2020 2019 2020 2019
Common OP Units (Note 8) 468,475
594,788
468,475
594,788
Preferred OP Units (Note 8) 35,242
35,242
35,242
49,722
Unvested restricted stock awards (Note 9) 1,103,137
—
—
—
Total potentially dilutive securities 1,606,854
630,030
503,717
644,510

Six Months Ended
June 30,
2020 2019 Change ($) Change (%)
Revenues
Owned properties $ 409,277
$ 427,575
$ (18,298 ) (4.3 )%
On-campus participating properties 14,810
17,844
(3,034 ) (17.0 )%
Third-party development services 3,345
6,778
(3,433 ) (50.6 )%
Third-party management services 6,497
5,776
721
12.5 %
Resident services 1,022
1,529
(507 ) (33.2 )%
Total revenues 434,951
459,502
(24,551 ) (5.3 )%

Operating expenses (income)

Owned properties 178,223
182,932
(4,709 ) (2.6 )%
On-campus participating properties 6,574
7,763
(1,189 ) (15.3 )%
Third-party development and management services 11,184
8,699
2,485
28.6 %
General and administrative 19,925
15,430
4,495
29.1 %
Depreciation and amortization 132,610
137,570
(4,960 ) (3.6 )%
Ground/facility leases 6,962
6,785
177
2.6 %
(Gain) loss from disposition of real estate (48,525 ) 282
(48,807 ) (17,307.4 )%
Provision for impairment —
3,201
(3,201 ) (100.0 )%
Total operating expenses 306,953
362,662
(55,709 ) (15.4 )%

Operating income 127,998
96,840
31,158
32.2 %

Nonoperating income (expenses)

Interest income 1,721
1,895
(174 ) (9.2 )%
Interest expense (54,951 ) (54,129 ) (822 ) 1.5 %
Amortization of deferred financing costs (2,542 ) (2,350 ) (192 ) 8.2 %
Loss from extinguishment of debt (4,827 ) —
(4,827 ) 100.0 %
Total nonoperating expenses (60,599 ) (54,584 ) (6,015 ) 11.0 %

Income before income taxes 67,399
42,256
25,143
59.5 %
Income tax provision (760 ) (678 ) (82 ) 12.1 %
Net income 66,639
41,578
25,061
60.3 %

Net loss (income) attributable to noncontrolling interests 872
(1,552 ) 2,424
(156.2 )%
Net income attributable to ACC, Inc. and Subsidiaries common stockholders $ 67,511
$ 40,026
$ 27,485
68.7 %

Same Store and New Property Operations

A reconciliation of our same store, new property and sold/other property operations to our consolidated statements of comprehensive income is set forth below:


	Same Store Properties				New Properties					Sold Properties/ Other (1)					Total - All Properties
	Nine Months Ended September 30,				Nine Months Ended September 30,					Nine Months Ended September 30,					Nine Months Ended September 30,
	2020		2019		2020			2019		2020		2019			2020		2019
Number of properties	152		152		7		(2)	5		1		5		(3)	160		162
Number of beds	92,193		92,193		5,642			3,159		901		2,911			98,736		98,263

Revenues (4)	$	571,861	$	617,195	$	28,069		$	5,110	$	2,701	$	18,607		$	602,631	$	640,912
Operating expenses	271,175		281,689		12,266			3,792		1,300		9,287			284,741		294,768

Same Store Properties New Properties
Sold Properties/Other ⁽¹⁾
Total - All Properties
Six Months Ended
June 30, Six Months Ended
June 30, Six Months Ended
June 30, Six Months Ended
June 30,
2020 2019 2020 2019 2020 2019 2020 2019
Number of properties
152
152
5
—
1
5
⁽²⁾
158
157

Number of beds 92,193
92,193
3,159
—
901
2,911
96,253
95,104

Revenues ⁽³⁾
$ 389,133
$ 415,631
$ 18,465
$ 443
$ 2,701
$ 13,030
$ 410,299
$ 429,104

Operating expenses 170,225
175,163
6,880
1,184
1,118
6,585
178,223
182,932

(1)Does not include the allocation of payroll and other administrative costs related to corporate management and oversight. Includes professional fees related to the operation of consolidated joint ventures that are included in owned properties operating expenses in the consolidated statements of comprehensive income.

⁽¹⁾

(2)Does not include the Walt Disney World® Resort project which will be delivered in multiple phases from 2020 to 2023 and is currently included in owned properties under development.

(3)Includes properties sold in 2019 and 2020 and one property transferred to the lender in July 2019 in settlement of its mortgage loan.

(4)Includes revenues which are reflected as resident services revenue on the accompanying consolidated statements of comprehensive income.

Does not include the allocation of payroll and other administrative costs related to corporate management and oversight. Also includes recurring professional fees related to the operation of the ACC / Allianz Joint Venture.


⁽²⁾	~~Includes properties sold in 2019 and 2020 and one property transferred to the lender in July 2019 in settlement of its mortgage loan.~~


⁽³⁾	~~Includes revenues which are reflected as resident services revenue on the accompanying consolidated statements of comprehensive income.~~

Same Store Properties: The decrease in revenue from our same store properties was primarily due to the ~~same factors that contributed~~following impacts of COVID-19: (i) approximately $17.2 million in rent refunds and/or early lease terminations was provided to ~~the decrease~~tenants at our on-campus ACE properties and certain off-campus residence halls; (ii) approximately $12.7 million in rent was forgiven as part of our Resident Hardship Program for ~~the three months ended June 30, 2020. This decrease was partially offset by~~residents and families who experienced financial hardship due to COVID-19; (iii) approximately $15.8 million as a result of lost summer camp and conference revenue, waived fees, an increase in ~~average rental rates~~the provision for uncollectible accounts resulting from rent delinquencies, and other items related to COVID-19; and (iv) an $8.6 million decrease in revenues for the ~~2019/~~nine months ended September 30, 2020 as compared to the amount initially anticipated prior to the impact of COVID-19 due to the reduced level of occupancy achieved from the 2020/2021 academic ~~year.~~year lease-up.

The decrease in operating expenses from our same store properties was primarily due to the same factors that contributed to the decrease for the three months ended ~~June~~September 30, 2020.

New Property Operations: Our new properties for the ~~six~~nine months ended ~~June~~September 30, 2020 are summarized in the table of new properties contained in the discussion of our results of operations for the three months ended ~~June~~September 30, 2020 and 2019.

On-Campus Participating Properties (“OCPP”) Operations

As of ~~June~~September 30, 2020,, we had six OCPPs containing 5,230 beds. Revenues from these properties decreased by ~~$3.0~~$4.6 million, from ~~$17.8~~$24.8 million for the ~~six~~nine months ended ~~June~~September 30, 2019, to ~~$14.8~~$20.2 million for the ~~six~~nine months ended ~~June 30, 2020. The increase is primarily due to the same factors that contributed to the increase for the three months ended June 30, 2020.~~

~~Operating expenses at these properties decreased by approximately $1.2 million, from $7.8 million for the six months ended June 30, 2019 to $6.6 million for the six months ended June~~September 30, 2020. The decrease is primarily due to the same factors that contributed to the ~~increase~~decrease for the three months ended ~~June~~September 30, ~~2020.~~2020 in addition to the universities’ decisions to provide rent abatements to tenants during the latter part of the 2019/2020 academic year.

Operating expenses at these properties decreased by approximately $1.2 million, from $11.6 million for the nine months ended September 30, 2019 to $10.4 million for the nine months ended September 30, 2020. This decrease was primarily due to decreases in payroll, maintenance and utilities as a result of decreased occupancy at the properties due to COVID-19.

Third-Party Development Services Revenue

Third-party development services revenue decreased by approximately ~~$3.5~~$6.9 million, from ~~$6.8~~$12.4 million during the ~~six~~nine months ended ~~June~~September 30, 2019, to ~~$3.3~~$5.5 million for the ~~six~~nine months ended ~~June~~September 30, 2020. The decrease was primarily due to fewer on-going third-party development projects under construction during the nine months ended September 30, 2020, as compared to the nine months ended September 30, 2019. During the nine months ended September 30, 2020 we had four projects under construction with an average contractual fee of $4.3 million, as compared to eight projects under construction during the nine months ended September 30, 2019 with an average contractual fee of $4.1 million. The decrease was also due to the closing of bond financing and commencement of construction of ~~three projects during~~ the ~~six months ended June 30, 2019, which contributed $4.3 million in revenue~~Dundee Residence Hall and Glasgow Dining Hall Project at University of California, Riverside during the prior year period, which contributed approximately $3.6 million in ~~addition to a decrease in~~revenue for the ~~number of third-party development projects under construction during the six~~nine months ended ~~June~~September 30, ~~2020,~~2019 as compared to the ~~six months ended June 30, 2019. During~~commencement of construction of the ~~six months ended June 30, 2020 we had three projects under construction with an average contractual fee of $4.7 million, as compared to eight projects under construction~~Capitol Campus Housing project at Georgetown University during the ~~six months ended June 30, 2019 with an average contractual fee of $3.7 million.~~

~~Third-Party Management Services Revenue~~

~~Third-party management services revenue increased by~~current year period, which contributed approximately $0.7 million, from $5.8 million during the six months ended June 30, 2019, to $6.5 million for the six months ended June 30, 2020. The increase was primarily due to reimbursed payroll and other costs from the Disney College Program management contract which began in April 2019. As facilities manager, the Company is responsible for the operations and maintenance of the projects. Because of the company’s role in funding payroll costs for on-site personnel at the properties, as well as other miscellaneous costs, accounting guidance requires the management fee for this project to be recorded on a gross basis in the Company’s consolidated financial statements. Accordingly, both management services revenue and third-party management services expenses for the six months ended June 30, 2020 include approximately $2.1$1.6 million in such reimbursed costs as compared to approximately $1.1 million during the six months ended June 30, 2019. This increase was partially offset by the same factors that contributed to the decrease in third-party management services revenue for the three months ended June 30, 2020, as discussed above.revenue.

Third-Party Development and Management Services Expenses

Third-party development and management services expenses increased by approximately ~~$2.5~~$2.1 million, from ~~$8.7~~$14.1 million during the ~~six~~nine months ended ~~June~~September 30, 2019, to ~~$11.2~~$16.2 million for the ~~six~~nine months ended ~~June~~September 30, 2020. The increase iswas primarily due to ~~an increase in reimbursed payroll and other costs from the Disney College Program management contract as described above,~~ increased pursuit activity for potential third-party development and management contracts ~~and~~as well as an increase in the provision for uncollectible accounts related to accounts receivable from third-party development and management projects. The increase was also due to reimbursed payroll and other costs from the Disney College Program management contract which began in April 2019. As facilities manager, the Company is responsible for the operations and maintenance of the projects. Because of the company’s role in funding payroll costs for on-site personnel at the properties, as well as other miscellaneous costs, accounting guidance requires the management fee for this project to be recorded on a gross basis in the Company’s consolidated financial statements. Accordingly, both management services revenue and third-party management services expenses for the nine months ended September 30, 2020 include approximately $2.9 million in such reimbursed costs as compared to approximately $1.9 million for the nine months ended September 30, 2019.

General and Administrative

General and administrative expenses increased by approximately ~~$4.5~~$6.0 million from ~~$15.4~~$22.6 million during the ~~six~~nine months ended ~~June~~September 30, 2019, to ~~$19.9~~$28.6 million for the ~~six~~nine months ended ~~June~~September 30, 2020. The increase was primarily due to $1.1 million in litigation settlement expenses incurred during the three months ended March 31, 2020, as well as additional expenses incurred in connection with enhancements to our operating systems platform and other general inflationary factors. These increases were offset by COVID-19 related decreases in travel expenses and payroll.

Depreciation and Amortization

Depreciation and amortization decreased by approximately ~~$5.0~~$6.5 million, from ~~$137.6~~$206.5 million during the ~~six~~nine months ended ~~June~~September 30, 2019, to ~~$132.6~~$200.0 million for the ~~six~~nine months ended ~~June~~September 30, 2020. The decrease was primarily due to an ~~$8.5~~$11.3 million decrease at our same store properties due to assets that became fully amortized or depreciated over the last year, a ~~$3.5~~$5.1 million decrease related to properties sold in 2019 and 2020 and a decrease of approximately ~~$0.6~~$0.9 million in depreciation of corporate assets. These decreases were offset by ~~an increase~~increases of approximately ~~$7.6~~$11.2 million related to the completion of construction and opening of owned development properties in ~~Fall 2019.~~2019 and 2020.

(Gain) Loss from Disposition of Real Estate

During the ~~six~~nine months ended ~~June~~September 30, 2020, we sold one owned property containing 901 beds, resulting in a net gain from disposition of real estate of approximately $48.5 million. During the ~~six~~nine months ended ~~June~~September 30, 2019, we sold one owned property containing 544 beds, resulting in a net loss from disposition of real estate of approximately $0.3 million. Refer to Note 45 in the accompanying Notes to the Consolidated Financial Statements contained in Item 1.

Provision for Impairment

During the ~~six~~nine months ended ~~June~~September 30, 2019, we recorded an impairment charge of approximately $3.2 million for one owned property serving students attending Florida A&M University, which was classified as held for sale as of March 31, 2019 and was sold in May 2019.

Interest Expense

Interest expense increased by approximately ~~$0.9~~$1.6 million, from ~~$54.1~~$82.4 million during the ~~six~~nine months ended ~~June~~September 30, 2019, to ~~$55.0~~$84.0 million for the ~~six~~nine months ended ~~June~~September 30, 2020. The increase was primarily due to ~~$6.9~~$10.2 million of additional interest incurred related to our offerings of unsecured notes in June 2019, January 2020 and June 2020, net of unsecured notes repaid in January 2020 that were originally scheduled to mature in October ~~2020, and a $0.3 million decrease in capitalized interest.~~2020. This increase was offset by: (i) a ~~$2.1~~$3.6 million decrease related to ~~the timing of borrowings~~a lower average outstanding balance under our unsecured revolving credit facility during the ~~respective six-month periods;~~nine months ended September 30, 2020 as compared to the nine months ended September 30, 2019; (ii) a ~~$1.7~~$1.8 million decrease in default interest related to a property that was transferred to the lender in settlement of the property’s mortgage loan in July 2019; (iii) a ~~$1.0~~$1.4 million decrease in interest on our term loan facility due to interest rate swaps executed in November and December 2019; (iv) a ~~$0.6~~$0.8 million decrease due to the pay-off of mortgage ~~debt in 2020; and~~debt; (v) a ~~$0.3~~$0.7 million decrease at our on-campus participating properties due to scheduled principal ~~payments.~~payments; and (vi) a $0.2 million decrease in capitalized interest.

~~Loss~~(Loss) Gain from ~~Early~~ Extinguishment of Debt

During the ~~six~~nine months ended ~~June~~September 30, 2020, we recognized a $4.8 million loss on the extinguishment of debt related to the early redemption of our $400 million 3.35% Senior Notes due October 2020. The redemption was funded using net proceeds from the Operating Partnership’s closing of a $400 million offering of senior unsecured notes under its existing shelf registration in January 2020. ~~Refer~~During the nine months ended September 30, 2019, we recognized a $21.0 million gain on the extinguishment of debt associated with a property that was transferred to ~~Note 6~~the lender in settlement of the ~~accompanying Notes to Consolidated Financial Statements~~property’s mortgage loan in ~~Item 1 for a detailed discussion of this transaction.~~July 2019.

Net Loss (Income) Attributable to Noncontrolling Interests

Net loss (income) attributable to noncontrolling interests represents consolidated joint venture partners’ share of net loss (income), as well as net loss (income) allocable to ~~holders of Operating Partnership units.~~OP unitholders. Net income attributable to noncontrolling interests decreased by ~~$2.5~~$3.5 million, from net income of ~~$1.6~~$0.7 million for the ~~six~~nine months ended ~~June~~September 30, 2019, to a net loss of ~~$0.9~~$2.8 million for the ~~six~~nine months ended ~~June~~September 30, 2020. This decrease is primarily due to decreased operating performance at certain properties held through joint ventures due to COVID-19 as well as the purchase of the remaining ownership interests in properties held in a joint ~~venture as part of the Core Transaction, as well as decreased operating performance at certain properties held through joint ventures due to COVID-19.~~venture.

Liquidity and Capital Resources

Cash Balances and Cash Flows

As of ~~June~~September 30, 2020, we had ~~$61.0~~$68.0 million in cash and cash equivalents and restricted cash as compared to $81.3 million in cash and cash equivalents and restricted cash as of December 31, 2019. Restricted cash primarily consists of escrow accounts held by lenders, resident security deposits as required by law in certain states, and funds held in escrow in connection with potential acquisition and development opportunities. The following discussion relates to changes in cash due to operating, investing and financing activities, which are presented in our consolidated statements of cash flows included in Item 1.

Operating Activities: For the ~~six~~nine months ended ~~June~~September 30, 2020, net cash provided by operating activities was approximately ~~$143.1~~$244.3 million, as compared to approximately ~~$148.4~~$273.7 million for the ~~six~~nine months ended ~~June~~September 30, 2019, a decrease of ~~$5.3~~$29.4 million. This decrease was primarily due to rent abatements, early lease terminations, and other financial relief provided by the Company due to COVID-19 as well as the sale of properties in 2019 and ~~2020, and the timing of property tax payments for owned properties.~~2020. This decrease was partially offset by operating cash flows from the ~~completion~~commencement of ~~construction of~~occupancy at owned ~~development properties~~ and presale development properties completed in 2019 ~~the timing of property tax payments for owned properties~~ and ~~the timing of interest payments.~~2020.

Investing Activities: Investing activities utilized approximately ~~$51.5~~$169.7 million and ~~$239.6~~$407.1 million for the ~~six~~nine months ended ~~June~~September 30, 2020 and 2019, respectively. The ~~$188.1~~$237.4 million decrease in cash utilized was primarily a result of the following: (i) $146.1 million in proceeds from the disposition of one property during the ~~six~~nine months ended ~~June~~September 30, 2020, as compared to $8.9 million in proceeds in the prior year ~~related to~~from the sale of one ~~property and~~property; (ii) a ~~$64.2~~$95.8 million decrease in cash used to fund the construction of our owned development ~~properties.~~properties; (iii) a $6.3 million decrease in cash used for capital expenditures at our owned properties; and (iv) $5.3 million in proceeds from insurance settlements during the nine months ended September 30, 2020 included in other investing activities. These decreases in cash utilized were partially offset by ~~a $12.3 million~~an increase in the other investing activities line item due to financing of $5.4 million that the ~~reimbursement of construction costs for the Disney Education Center, which was classified as~~Company provided to a ~~deferred financing lease.~~joint venture partner.

Financing Activities: For the ~~six~~nine months ended ~~June~~September 30, 2020, net cash utilized inby financing activities totaled approximately ~~$112.0~~$87.9 million, as compared to net cash provided by financing activities of ~~$73.4~~$112.7 million for the ~~six~~nine months ended ~~June~~September 30, 2019. The ~~$185.4~~$200.6 million increase in cash utilized by financing activities was primarily a result of the following: (i) the $404.2 million pay-off of unsecured notes including costs associated with the early extinguishment of the notes; (ii) a $113.8 million increase in net paydowns on our revolving credit facility; (iii) a $33.1 million increase due to the purchase of the remaining ownership interest in two properties ~~for $77.2 million; (iii)~~held in a ~~$37.5 million increase~~joint venture during the nine months ended September 30, 2020, as compared to the purchase of the remaining ownership interest in ~~net paydowns on our revolving credit facility;~~

one pre-sale development property during the nine months ended September 30, 2019; (iv) ~~the $34.2 million pay-off of mortgage debt; and (v)~~ a ~~$26.1~~$29.9 million decrease ~~due to~~in proceeds from construction loans in the prior year ~~period.~~period; and (v) a $19.1 million increase in pay-offs of mortgage and construction loans. These increases in cash utilized by financing activities were partially offset by a ~~$393.9~~$393.8 million increase in proceeds from the issuance of unsecured notes, net of issuance ~~costs.~~costs and an increase of $4.2 million from the prior year in contributions from noncontrolling partners.

Liquidity Needs, Sources and Uses of Capital

As previously discussed, the ultimate effect of the COVID-19 pandemic on the student housing industry generally, and the Company specifically, is uncertain at this time. As such, the Company is unable to predict the full magnitude of the pandemic and its effect on our future cash flows and liquidity needs. The most significant factors affecting our future results are outlined above under Results of Operations.

As of ~~June~~September 30, 2020, the Company has met its financial obligations and believes it has sufficient liquidity to withstand future disruption. The Company has no additional debt maturities for the remainder of 2020, and has enacted expense reduction ~~initiatives, including suspending all non-essential capital improvement projects.~~initiatives. Additionally, in June 2020, the Company closed a $400 million offering of 3.875% 10-year senior unsecured notes, resulting in net proceeds of $391.7 ~~million.~~million after deducting the underwriting discount and offering expenses which will be amortized over the term of the unsecured notes. The proceeds were used to repay borrowings under the Company’s revolving credit facility, thus providing additional liquidity.

As of ~~June~~September 30, 2020, our short-term liquidity needs included, but were not limited to, the following: (i) potential distribution payments to our common and restricted stockholders totaling approximately $260.8 million assuming no change from the Company’s most recent quarterly distribution of $0.47 per share and the number of our shares outstanding as of ~~June~~September 30, 2020; (ii) potential distribution payments to our Operating Partnership unitholders totaling approximately $0.9 million assuming no change from the Operating Partnership’s most recent quarterly distribution of $0.47 per unit and the number of units outstanding as of ~~June~~September 30, 2020 and a cumulative preferential per annum cash distribution rate of 5.99% on our Preferred OP Units based on the number of units outstanding as of ~~June~~September 30, 2020; (iii) estimated development costs over the next 12 months totaling approximately ~~$226.7~~$166.4 million for our owned ~~properties~~property currently under construction; (iv) the pay-off of approximately ~~$126.3~~$128.7 million of outstanding fixed rate mortgage debt scheduled to mature in the next 12 months; (v) potential future developments, property or land acquisitions; and (vi) recurring capital expenditures.

We expect to meet our short-term liquidity requirements by: (i) utilizing current cash on hand and net cash provided by operations; (ii) borrowing under our existing revolving credit facility, which has availability of ~~$813.5~~$723.3 million as of ~~June~~September 30, 2020; (iii) accessing the unsecured bond market; (iv) exercising debt extension options to the extent they are available; (v) issuing securities, including common stock, under our ATM Equity Program discussed more fully in Note 78 in the accompanying Notes to Consolidated Financial Statements contained in Item 1, or otherwise; and (vi) potentially disposing of properties and/or entering into joint venture arrangements, depending on market conditions. Our ability to obtain additional financing will depend on a variety of factors such as market conditions, the general availability of credit, the overall availability of credit to the real estate industry, our credit ratings and credit capacity, as well as the perception of lenders regarding our long or short-term financial prospects.

We may seek additional funds to undertake initiatives not contemplated by our business plan or obtain additional cushion against possible shortfalls. We also may pursue additional financing as opportunities arise. Future financings may include a range of different sizes or types of financing, including the incurrence of additional secured debt and the sale of additional debt or equity securities. These funds may not be available on favorable terms or at all. Our ability to obtain additional financing depends on several factors, including future market conditions, our success or lack of success in penetrating our markets, our future creditworthiness, and restrictions contained in agreements with our investors or lenders, including the restrictions contained in the agreements governing our unsecured credit facility and unsecured notes. These financings could increase our level of indebtedness or result in dilution to our equity holders. The impact of the pandemic on global capital markets and the related effect on the Company’s stock price has introduced additional economic uncertainty which could affect our ability to obtain additional financing to meet short-term and/or long-term liquidity needs.

Although the Company believes it has sufficient liquidity as of ~~June~~September 30, 2020 to withstand future disruption related to COVID-19, the impact of the pandemic on global capital markets has impacted our stock price and credit ratings and has

introduced additional economic uncertainty, which could affect our ability to obtain additional financing to meet short-term and/or long-term liquidity needs.

Distributions

We are required to distribute 90% of our REIT taxable income (excluding capital gains) on an annual basis in order to qualify as a REIT for federal income tax purposes. Distributions to common stockholders are at the discretion of the Board of Directors. We may use borrowings under our unsecured revolving credit facility to fund distributions. The Board of Directors considers a number of factors when determining distribution levels, including market factors and our Company’s performance in addition to REIT requirements.

On ~~July 29,~~November 4, 2020, our Board of Directors declared a distribution per share of $0.47, which will be paid on ~~August 21,~~November 27, 2020 to all common stockholders of record as of ~~August 10,~~November 16, 2020. At the same time, the Operating Partnership will pay an equivalent amount per unit to holders of Common OP Units, as well as the quarterly cumulative preferential distribution to holders of Preferred OP Units.

Although the ultimate magnitude of the impact of COVID-19 on the Company’s future cash flows is uncertain, any curtailed or deferred tenant demand, additional lease terminations, rent refunds or abatements, or increased uncollectible accounts could have a material adverse effect on our cash flows from operations, and thus the Company’s ability to make distributions to stockholders and unitholders.

Indebtedness

The amounts below exclude net unamortized debt premiums and discounts related to mortgage loans assumed in connection with property acquisitions, original issue discounts (“~~OID”s)~~OIDs”), and deferred financing costs (see Note 67 in the accompanying Notes to the Consolidated Financial Statements contained in Item 1). A summary of our consolidated indebtedness as of ~~June~~September 30, 2020 is as follows:


	Amount		% of Total		Weighted Average Rates (1)		Weighted Average Maturities
Secured	$	738,459	20.4	%	4.5	%	5.7 Years
Unsecured	2,876,700		79.6	%	3.3	%	5.7 Years
Total consolidated debt	$	3,615,159	100.0	%	3.5	%	5.7 Years

Fixed rate debt
Secured
Project-based taxable bonds	$	19,110	0.5	%	7.5	%	4.2 Years

Mortgage	716,981		19.8	%	4.4	%	5.7 Years
Unsecured
April 2013 Notes	400,000		11.1	%	3.8	%	2.5 Years
June 2014 Notes	400,000		11.1	%	4.1	%	3.8 Years
October 2017 Notes	400,000		11.1	%	3.6	%	7.1 Years
June 2019 Notes	400,000		11.1	%	3.3	%	5.8 Years
January 2020 Notes	400,000		11.1	%	2.9	%	9.3 Years
June 2020 Notes	400,000		11.1	%	3.9	%	10.3 Years
Term loans	200,000		5.4	%	2.5	%	1.7 Years
Total - fixed rate debt	3,336,091		92.3	%	3.7	%	6.0 Years

Variable rate debt:
Secured
Mortgage	2,368		0.1	%	2.7	%	24.8 Years
Unsecured
Unsecured revolving credit facility	276,700		7.6	%	1.4	%	1.5 Years
Total - variable rate debt	279,068		7.7	%	1.4	%	1.7 Years
Total consolidated debt	$	3,615,159	100.0	%	3.5	%	5.7 Years

Amount % of Total
Weighted Average Rates⁽¹⁾
Weighted Average Maturities
Secured $ 744,540
21.2 % 4.5 % 6.0 Years
Unsecured 2,786,500
78.8 % 3.4 % 6.1 Years
Total consolidated debt $ 3,531,040
100.0 % 3.6 % 6.0 Years

Fixed rate debt
Secured
Project-based taxable bonds $ 23,215
0.7 % 7.6 % 4.4 Years
Mortgage 718,679
20.4 % 4.4 % 6.0 Years
Unsecured
April 2013 Notes 400,000
11.3 % 3.8 % 2.8 Years
June 2014 Notes 400,000
11.3 % 4.1 % 4.0 Years
October 2017 Notes 400,000
11.3 % 3.6 % 7.4 Years
June 2019 Notes 400,000
11.3 % 3.3 % 6.0 Years
  January 2020 Notes 400,000
11.3 % 2.9 % 9.6 Years
  June 2020 Notes 400,000
11.3 % 3.9 % 10.6 Years
Term loans 200,000
5.7 % 2.5 % 2.0 Years
Total - fixed rate debt 3,341,894
94.6 % 3.7 % 6.3 Years

Variable rate debt:
Secured
Mortgage 2,646
0.1 % 2.7 % 25.1 Years
Unsecured
Unsecured revolving credit facility 186,500
5.3 % 1.4 % 1.7 Years
Total - variable rate debt 189,146
5.4 % 1.4 % 2.0 Years
Total consolidated debt $ 3,531,040
100.0 % 3.6 % 6.0 Years

(1)    Represents stated interest rate and does not include the effect of the amortization of deferred financing costs, debt premiums and discounts, OIDs, and interest rate swap terminations.


⁽¹⁾	~~Represents stated interest rate and does not include the effect of the amortization of deferred financing costs, debt premiums and discounts, OIDs, and interest rate swap terminations.~~

As discussed previously, as of ~~June~~September 30, 2020, the Company has met its financial obligations including servicing its debt and believes it has sufficient liquidity to withstand future disruption. However, the ultimate magnitude of the pandemic on our future cash flows and liquidity position is uncertain at this time. While the Company was in compliance with all debt covenants for both secured and unsecured indebtedness as of ~~June~~September 30, 2020, the economic disruption caused by the COVID-19 pandemic could

adversely affect our future ability to remain in compliance with our debt covenants, depending on the ultimate impact on the valuation of collateral and the incurrence of any additional financing to meet our liquidity needs. The specific covenants that management is closely monitoring as the situation evolves include the debt-to-total asset value and fixed charge coverage requirements under the Company’s unsecured revolving credit facility. As it relates to the debt-to-total asset value covenant, which is highly dependent on net operating income levels of the Company’s operating properties, management believes that net operating income at such properties could decrease in the next 12 months by up to approximately ~~$145~~$129 million before the Company is at risk of potentially violating the covenant. As it relates to the fixed charge coverage covenant, which is highly dependent upon a specific measure of Earnings Before Interest, Taxes, Depreciation, and Amortization (“EBITDA”), as defined in the related agreement, management believes that the EBITDA measure for the next 12 months could decrease by up to approximately ~~$255~~$235 million before the Company is at risk of potentially violating the covenant. In addition, our credit ratings given by Moody’s and Standard & Poor’s are based on a number of factors, which include their assessment of our financial strength, liquidity, capital structure, asset quality and sustainability of cash flow and earnings. If we are unable to maintain our current credit ratings due to the COVID-19 pandemic or any other matter, the cost of funds under our credit facilities and our liquidity and access to capital markets would be adversely affected. The Company has a BBB credit rating with a stable outlook from Moody’s Investors Services, Inc. and a Baa2 credit rating with a negative outlook from Standard & Poor’s Rating Group.

Funds From Operations (“FFO”)

The National Association of Real Estate Investment Trusts (“NAREIT”) currently defines FFO as net income or loss attributable to common shares computed in accordance with generally accepted accounting principles (“GAAP”), excluding gains or losses from depreciable operating property sales, impairment charges and real estate depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. We present FFO because we consider it an important supplemental measure of our operating performance and believe it is frequently used by securities analysts, investors and other interested parties in the evaluation of REITs, many of which present FFO when reporting their results. FFO excludes GAAP historical cost depreciation and amortization of real estate and related assets, which assumes that the value of real estate diminishes ratably over time. Historically, however, real estate values have risen or fallen with market conditions. We therefore believe that FFO provides a performance measure that, when compared year over year, reflects the impact to operations from trends in occupancy rates, rental rates, operating costs, and interest costs, among other items, providing perspective not immediately apparent from net income. We compute FFO in accordance with standards established by the Board of Governors of NAREIT in its December 2018 White Paper, which may differ from the methodology for calculating FFO utilized by other equity REITs and, accordingly, may not be comparable to such other REITs.

We also believe it is meaningful to present a measure we refer to as FFO-Modified, or FFOM, which reflects certain adjustments related to the economic performance of our on-campus participating properties, the elimination of transaction costs, and other items, as we determine in good faith. Under our participating ground leases, we and the participating university systems each receive 50% of the properties’ net cash available for distribution after payment of operating expenses, debt service (which includes significant amounts towards repayment of principal), and capital expenditures. A substantial portion of our revenues attributable to these properties is reflective of cash that is required to be used for capital expenditures and for the amortization of applicable property indebtedness. These amounts do not increase our economic interest in these properties or otherwise benefit us since our interest in the properties terminates upon the repayment of the applicable property indebtedness. Therefore, unlike the ownership of our owned properties, the unique features of our ownership interest in our on-campus participating properties cause the value of these properties to diminish over time. For example, since the ground/facility leases under which we operate the participating properties require the reinvestment from operations of specified amounts for capital expenditures and for the repayment of debt while our interest in these properties terminates upon the repayment of the debt, such capital expenditures do not increase the value of the property to us and mortgage debt amortization only increases the equity of the ground lessor. Accordingly, we believe it is meaningful to modify FFO to exclude the operations of our on-campus participating properties and to consider their impact on our performance by including only that portion of our revenues from those properties that are reflective of our share of net cash flow and the management fees that we receive, both of which increase and decrease with the operating performance of the properties. This narrower measure of performance measures our profitability for these properties in a manner that is similar to the measure of our profitability from our third-party services business where we similarly incur no initial or ongoing capital investment in a property and derive only consequential benefits from capital expenditures and debt amortization. We believe, however, that this narrower measure of performance is inappropriate in traditional real estate ownership structures where debt amortization and capital expenditures enhance the property owner’s long-term profitability from its investment.

Our FFOM may have limitations as an analytical tool because it reflects the contractual calculation of net cash flow from our on-campus participating properties, which is unique to us and is different from that of our owned off-campus properties. Companies that are considered to be in our industry may not have similar ownership structures; and therefore those companies may not calculate FFOM in the same manner that we do, or at all, limiting its usefulness as a comparative measure. We compensate for these limitations by relying primarily on our GAAP and FFO results and using FFOM only supplementally. Further, FFO and FFOM do not represent amounts available for management’s discretionary use because of needed capital replacement or expansion, debt service obligations or other commitments and uncertainties. FFO and FFOM should not be considered as alternatives to net income or loss computed in accordance with GAAP as an indicator of our financial performance, or to cash flow from operating activities computed in accordance with GAAP as an indicator of our liquidity, nor are these measures indicative of funds available to fund our cash needs, including our ability to pay dividends or make distributions.

During the year ended December 31, 2019, the Company updated the presentation of the calculation of FFO, as it relates to the presentation of consolidated joint venture partners' share of FFO and the presentation of corporate depreciation. Prior period amounts have been updated to conform to the current presentation. There were no changes to the FFO calculated or the underlying financial information used in the calculation.

The following table presents a reconciliation of our net income attributable to common stockholders to FFO and FFOM:

Three Months Ended
June 30, Six Months Ended
June 30,
2020 2019 2020 2019
Net (loss) income attributable to ACC, Inc. and Subsidiaries common stockholders $ (13,344 ) $ 10,386
$ 67,511
$ 40,026
Noncontrolling interests' share of net (loss) income (2,078 ) (176 ) (872 ) 1,552

Joint Venture ("JV") partners' share of FFO
JV partners' share of net loss (income) 2,046
230
1,130
(1,338 )
JV partners' share of depreciation and amortization (1,927 ) (2,186 ) (3,892 ) (4,343 )
119
(1,956 ) (2,762 ) (5,681 )

Loss (gain) from disposition of real estate —
282
(48,525 ) 282
Elimination of provision for real estate impairment —
—
—
3,201
Total depreciation and amortization 66,441
68,815
132,610
137,570
Corporate depreciation ⁽¹⁾
(885 ) (1,171 ) (1,774 ) (2,393 )
FFO attributable to common stockholders and OP unitholders 50,253
76,180
146,188
174,557

Elimination of operations of on-campus participating properties ("OCPPs")

Net loss (income) from OCPPs 2,206
1,130
(1,500 ) (2,562 )
Amortization of investment in OCPPs (2,045 ) (2,016 ) (4,082 ) (4,045 )
50,414
75,294
140,606
167,950

Modifications to reflect operational performance of OCPPs

Our share of net cash flow⁽²⁾
254
828
1,114
1,710
Management fees and other 244
408
827
1,228
Contribution from OCPPs 498
1,236
1,941
2,938

Elimination of loss from extinguishment of debt ⁽³⁾
—
—
4,827
—
Elimination of litigation settlement expense⁽⁴⁾
—
—
1,100
—
Elimination of FFO from property in receivership ⁽⁵⁾
—
839
—
1,808
Funds from operations-modified ("FFOM") attributable to common stockholders and OP unitholders $ 50,912
$ 77,369
$ 148,474
$ 172,696

FFO per share - diluted $ 0.36
$ 0.55
$ 1.05
$ 1.26
FFOM per share - diluted $ 0.37
$ 0.56
$ 1.07
$ 1.24
Weighted-average common shares outstanding - diluted 139,220,414
138,873,418
139,155,823
138,842,644


⁽¹⁾	~~Represents depreciation on corporate assets not added back for purposes of calculating FFO.~~

⁽²⁾

50% of the properties’ net cash available for distribution after payment of operating expenses, debt service (including repayment of principal) and capital expenditures which is included in ground/facility leases expense in the consolidated statements of comprehensive income. The decrease as compared to prior year is a result of the universities' decisions to provide rent abatements to tenants related to COVID-19.


⁽³⁾	~~Represents loss associated with the January 2020 redemption of the Company's $400 million 3.35% Senior Notes originally scheduled to mature in October 2020.~~


⁽⁴⁾	~~Represents the settlement of a litigation matter that is included in general and administrative expenses in the accompanying consolidated statements of comprehensive income.~~


⁽⁵⁾	~~Represents FFO for an owned property that was transferred to the lender in July 2019 in settlement of the property's mortgage loan.~~


	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Net (loss) income attributable to ACC, Inc. and Subsidiaries common stockholders	$	(19,515)	$	20,223	$	47,996	$	60,249
Noncontrolling interests' share of net (loss) income	(1,909)		(887)		(2,781)		665

Joint Venture ("JV") partners' share of FFO
JV partners' share of net loss (income)	1,857		970		2,987		(368)
JV partners' share of depreciation and amortization	(1,944)		(2,145)		(5,836)		(6,488)
	(87)		(1,175)		(2,849)		(6,856)

(Gain) loss from disposition of real estate	—		—		(48,525)		282
Elimination of provision for real estate impairment	—		—		—		3,201
Total depreciation and amortization	67,369		68,930		199,979		206,500
Corporate depreciation (1)	(858)		(1,135)		(2,632)		(3,528)
FFO attributable to common stockholders and OP unitholders	45,000		85,956		191,188		260,513

Elimination of operations of on-campus participating properties ("OCPPs")
Net loss (income) from OCPPs	1,294		424		(206)		(2,138)
Amortization of investment in OCPPs	(1,883)		(2,289)		(5,965)		(6,334)
	44,411		84,091		185,017		252,041

Modifications to reflect operational performance of OCPPs
Our share of net cash flow (2)	518		353		1,632		2,063
Management fees and other	319		369		1,146		1,597
Contribution from OCPPs	837		722		2,778		3,660

Transaction costs (3)	—		147		—		147
Elimination of (gain) loss from extinguishment of debt (4)	—		(20,992)		4,827		(20,992)

Elimination of litigation settlement expense (5)	—		—		1,100		—
Elimination of FFO from property in receivership (6)	—		104		—		1,912
Funds from operations-modified ("FFOM") attributable to common stockholders and OP unitholders	$	45,248	$	64,072	$	193,722	$	236,768

FFO per share - diluted	$	0.32	$	0.62	$	1.37	$	1.88
FFOM per share - diluted	$	0.32	$	0.46	$	1.39	$	1.71
Weighted-average common shares outstanding - diluted	139,235,064		138,879,244		139,182,430		138,854,970

~~Inflation~~

(1)Represents depreciation on corporate assets not added back for purposes of calculating FFO.

(2)50% of the properties’ net cash available for distribution after payment of operating expenses, debt service (including repayment of principal) and capital expenditures which is included in ground/facility leases expense in the consolidated statements of comprehensive income. The decrease as compared to prior year is a result of the universities' decisions to provide rent abatements to tenants during the latter part of the 2019/2020 academic year and the lower occupancy achieved for the 2020/2021 academic year as a result of COVID-19.

(3)Represent transaction costs incurred in connection with the closing of one presale transaction in August 2019.

(4)The three and nine months ended September 30, 2019 amounts represent the gain on the extinguishment of debt associated with a property that was transferred to the lender in settlement of the property's mortgage loan in July 2019. The nine months ended September 30, 2020 amount represents the loss associated with the January 2020 redemption of the Company's $400 million 3.35% Senior Notes originally scheduled to mature in October 2020.

(5)Represents the settlement of a litigation matter that is included in general and administrative expenses in the accompanying consolidated statements of comprehensive income.

(6)Represents FFO for an owned property that was transferred to the lender in July 2019 in settlement of the property's mortgage loan.

Inflation

Our student leases do not typically provide for rent escalations. However, they typically do not have terms that extend beyond 12 months. Accordingly, although on a short term basis we would be required to bear the impact of rising costs resulting from inflation, we have the opportunity to raise rental rates at least annually to offset such rising costs. However, a weak economic environment or declining student enrollment at our principal universities may limit our ability to raise rental rates.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

The Company manages its market risk by matching projected cash inflows from operating, investing, and financing activities with projected cash outflows for debt service, acquisitions, capital expenditures, distributions to stockholders and unitholders, and other cash requirements. The Company is exposed to adverse changes in prevailing market rates and the impact of adverse interest rate changes on its unsecured credit facility as well as its ability to incur more debt without stockholder approval. However, the Company uses derivative instruments to manage exposure to interest rates, and the majority of its outstanding debt has fixed interest rates. No material changes have occurred in relation to market risk since our Annual Report on Form 10-K for the year ended December 31, 2019, except as disclosed in Part II, Item 1A, herein, “Risk Factors.”

Item 4. Controls and Procedures

American Campus Communities, Inc.


~~(a)~~	~~Evaluation of Disclosure Controls and Procedures~~

(a)Evaluation of Disclosure Controls and Procedures

As required by SEC Rule 13a-15(b), we have carried out an evaluation, under the supervision of and with the participation of management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this report. Based on the foregoing, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures for the quarter covered by this report were effective at the reasonable assurance level.


~~(b)~~	~~Changes in Internal Control Over Financial Reporting~~

(b)Changes in Internal Control Over Financial Reporting

There has been no change in our internal control over financial reporting during our most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. We have not experienced any material impacts to our internal control over financial reporting to date as a result of a majority of our corporate office employees working remotely due to the COVID-19 pandemic. We are continually monitoring and assessing our internal control environment to ensure that our controls continue to be designed effectively and continue to operate effectively throughout the duration of the pandemic.

American Campus Communities Operating Partnership LP


~~(a)~~	~~Evaluation of Disclosure Controls and Procedures~~

(a)Evaluation of Disclosure Controls and Procedures


~~(b)~~	~~Changes in Internal Control Over Financial Reporting~~

(b)Changes in Internal Control Over Financial Reporting

PART II OTHER INFORMATION

Item 1. Legal Proceedings

We are subject to various claims, lawsuits and legal proceedings that arise in the ordinary course of business. While it is not possible to ascertain the ultimate outcome of such matters, management believes that the aggregate amount of such liabilities, if any, in excess of amounts provided or covered by insurance, will not have a material adverse effect on our consolidated financial position or our results of operations.

Item 1A. Risk Factors

Except as described below, there have been no material changes to the risk factors that were discussed in Part 1, Item 1A of the Company’s and the Operating Partnership’s Annual Report on Form 10-K for the year ended December 31, 2019 and in Part II, Item 1A of the Company’s and the Operating Partnership’s Quarterly Report on from 10-Q for the quarterly period ended ~~March 31,~~June, 30, 2020.

The effects of the COVID-19 pandemic have materially affected how we are operating our business, and the duration and extent to which this will impact our future results of operations and overall financial performance remains uncertain.

The novel coronavirus disease (“COVID-19”), which was characterized on March 11, 2020 by the World Health Organization as a pandemic, has currently resulted in a widespread health crisis, which has adversely affected international, national and local economies and financial markets generally, and has had an unprecedented effect on many businesses including the student housing industry.

Beginning in April 2020, our operations began to be negatively affected by a range of external factors related to the COVID-19 pandemic that are not within our control. All of the colleges and universities our properties serve canceled in-person classes for the remainder of the 2020 spring and summer term and many closed their on-campus residence halls or encouraged students living in on-campus residence halls to return to their permanent residences for the remainder of the spring term and in some cases for the summer term. Also, a wide range of restrictions on physical movement imposed by governmental entities to limit the spread of COVID-19 have been in effect. While our properties ~~remain~~have remained open throughout the pandemic, as a result of these actions, we ~~have~~ experienced significant decreases in students physically occupying their units at many of our ~~properties. We have~~properties during the spring and summer terms. During this time, we waived all late fees, online payment fees and financial-related eviction proceedings temporarily and ~~are working~~worked with residents and families who ~~endure~~endured financial hardship on a case by case ~~basis.~~basis through our Resident Hardship Program. In certain circumstances, we have provided financial assistance, including rent abatements and/or early lease terminations at both our off-campus ~~properties~~ and ~~our~~ on-campus properties, based on individual university policies. In addition, we transitioned property tours and other leasing activities for the 2020/2021 academic year to virtual experiences. Furthermore, we ~~have~~ experienced cancellations of summer camps, conferences and other events, which ~~has~~ impacted revenue we typically earn during the summer months at certain of our properties. ~~We have also experienced delays in~~

August and September 2020 marked the ~~closing~~beginning of ~~financing~~the 2020/2021 academic year, with students’ housing decisions and ~~commencement of construction for our third-party development projects, resulting in~~preferences being affected by the ~~revenue anticipated to be earned from such projects being delayed to future years. Curtailed or deferred tenant demand and additional delays~~continued uncertainty associated with COVID-19, which resulted in our ~~third-party development projects~~experiencing diminished leasing results. As of September 30, 2020, our 2021 same store portfolio was 90.3% occupied, which compares to 97.4% occupancy as of September 30, 2019. As such, as we progress through the current academic year, we anticipate reduced revenue as compared to prior years due to the lower occupancy at our properties. Additionally, in certain locations, governmental orders continue to restrict us from charging late fees and proceeding with financial eviction proceedings, which could ~~materially~~also adversely affect our ~~revenues~~revenue. We also continue to administer our Resident Hardship program and ~~cash flows from operations, and thus~~any additional rent abatements provided through the program will additionally adversely affect our ~~ability to make distributions to stockholders and unitholders and service indebtedness.~~

As of July 19, 2020, a third party source 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. However, at this time, there remains uncertainty as to the dates for reopening by colleges and universities, and whether these plans will change. Should a significant number ofrevenue. Finally, should the colleges ~~and~~or universities that our properties serve ~~fail to resume in-person classes for the upcoming 2020/2021 academic year or~~ decide to cancel classes due to a resurgence of COVID-19 cases or additional governmental actions restricting physical movement, we expect we would experience further adverse effects. The above factors also continue to affect the properties we manage under third-party management agreements, and because the management fees we earn are typically based on the properties’ revenue, we anticipate reduced management fee revenue from this business segment throughout the 2020/2021 academic year and possibly for future academic years. Any adverse effect on revenues could affect our ability to make distributions to stockholders and unitholders and service indebtedness, which could be material.

A significant number of the locations in which we conduct business have been subject to varying levels of ongoing “shelter in place” or “stay at home” orders adopted by state and local authorities. This resulted in a temporary closing of our corporate

headquarters and other offices and the implementation of travel restrictions, all of which disrupted how we operate our business. We have taken steps to allow our workforce to render critical business functions remotely. Many of these measures are being deployed for the first time and there is no guarantee that the data security and privacy safeguards we have put in place will be completely effective or that we will not encounter some of the common risks associated with employees accessing data and systems remotely. ~~Additionally, some~~

We have also experienced delays in the closing of ~~these orders may~~financing and commencement of construction for our third-party development projects, resulting in the revenue anticipated to be earned from such projects being delayed to future years. Curtailed or deferred tenant demand and additional delays in our third-party development projects could materially adversely affect ~~the completion of some or all of~~ our ~~projects under development at both universities~~revenue, and at ~~Walt Disney World~~^® ~~Resort if we are required~~thus our ability to ~~temporarily cease construction entirely, experience delays in obtaining governmental permits~~make distributions to stockholders and ~~authorizations, or experience disruption in the supply of materials or labor, which may result in our not completing these development projects on schedule or within budgeted amounts.~~unitholders and service indebtedness.

The COVID-19 pandemic has impacted the capital markets and could impact our cost of borrowing. Also, the pandemic may pose risks arising from market liquidity and credit concerns. Any deterioration of the capital markets could cause our income and expense to vary from expectations. As of ~~June~~September 30, 2020, we had no impairment charges associated with our long-term real estate investments, but we cannot predict future market conditions, market liquidity or credit availability, and can provide no assurance that our real estate portfolio will remain materially unimpaired. While we were in compliance with all debt covenants for both secured and unsecured indebtedness as of ~~June~~September 30, 2020, the economic disruption caused by the COVID-19 pandemic could affect our future ability to remain in compliance with our debt covenants, depending on the ultimate impact to the valuation of collateral and any additional financing we obtain to meet our liquidity needs. In addition, our credit ratings given by Moody’s and Standard & Poor’s are based on a number of factors, which include their assessment of our financial strength, liquidity, capital structure, asset quality and sustainability of cash flow and earnings. If we are unable to maintain our current credit ratings due to the COVID-19 pandemic or other changes in market conditions, the cost of funds under our credit facilities and our liquidity and access to capital markets would be adversely affected.

The COVID-19 pandemic and the responses to curb its spread continue to evolve daily. As such, it is uncertain as to the full magnitude of the pandemic on our results of operations, cash flows, financial condition, or liquidity for the year ending December 31, 2020, or future years.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

Item 6. Exhibits


Exhibit Number		Description of Document

~~Exhibit Number~~	~~Description of Document~~

31.1	American Campus Communities, Inc. - Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

~~31.2~~3 1.2		American Campus Communities, Inc. - Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.3		American Campus Communities Operating Partnership LP - Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.4		American Campus Communities Operating Partnership LP - Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1		American Campus Communities, Inc. - Certification of Chief Executive Officer Pursuant to 18 U. S. C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2		American Campus Communities, Inc. - Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.3		American Campus Communities Operating Partnership LP - Certification of Chief Executive Officer Pursuant to 18 U. S. C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.4		American Campus Communities Operating Partnership LP - Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS		XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

101.SCH		XBRL Taxonomy Extension Schema Document

101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF		XBRL Taxonomy Extension Definition Linkbase Document

101.LAB		XBRL Taxonomy Extension Label Linkbase Document

101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document

104		Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.



Dated:			~~July 31,~~November 6, 2020



AMERICAN CAMPUS COMMUNITIES, INC.

By:			/s/ Daniel B. Perry

			Daniel B. Perry Executive Vice President, Chief Financial Officer, Treasurer and Secretary

By:			/s/ Kim K. Voss

			Kim K. Voss Executive Vice President, Chief Accounting Officer, and Assistant Secretary

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.



Dated:			~~July 31,~~November 6, 2020



AMERICAN CAMPUS COMMUNITIES OPERATING PARTNERSHIP LP
By:	American Campus Communities Holdings, LLC, its general partner
	By:	American Campus Communities, Inc., its sole member

	By:	/s/ Daniel B. Perry

		Daniel B. Perry Executive Vice President, Chief Financial Officer, Treasurer and Secretary

	By:	/s/ Kim K. Voss

		Kim K. Voss Executive Vice President, Chief Accounting Officer, and Assistant Secretary



(American Campus Communities, Inc.)	Maryland		76-0753089
(American Campus Communities Operating Partnership LP)	Maryland		56-2473181
	(State or Other Jurisdiction of Incorporation or Organization)		(IRS Employer Identification No.)

	12700 Hill Country Blvd.,	Suite T-200	78738
	Austin,	TX	(Zip Code)
	(Address of Principal Executive Offices)



Non-accelerated filer	☐	Smaller reporting company	☐



Large accelerated filer	☐	Accelerated Filer	☐



Non-accelerated filer	☒ (Do not check if a smaller reporting company)	Smaller reporting company	☐



Title of each class	Trading symbol(s)	Name of each exchange on which registered
Common stock, par value $.01 per share	ACC	New York Stock Exchange



	June 30, 2020			December 31, 2019
	(Unaudited)
Assets

Investments in real estate:
Owned properties, net	$	6,659,939		$	6,694,715
On-campus participating properties, net	72,273			75,188
Investments in real estate, net	6,732,212			6,769,903

Cash and cash equivalents	31,011			54,650
Restricted cash	29,959			26,698
Student contracts receivable, net	9,194			13,470
Operating lease right of use assets	459,110			460,857
Other assets	253,024			234,176

Total assets	$	7,514,510		$	7,559,754

Liabilities and equity

Liabilities:
Secured mortgage, construction and bond debt, net	$	747,086		$	787,426
Unsecured notes, net	2,373,767			1,985,603
Unsecured term loans, net	199,297			199,121
Unsecured revolving credit facility	186,500			425,700
Accounts payable and accrued expenses	72,335			88,411
Operating lease liabilities	482,492			473,070
Other liabilities	161,091			157,368
Total liabilities	4,222,568			4,116,699

Commitments and contingencies (Note 12)

Redeemable noncontrolling interests	20,912			104,381

Equity:
American Campus Communities, Inc. and Subsidiaries stockholders’ equity:
Common stock, $0.01 par value, 800,000,000 shares authorized, 137,540,345 and 137,326,824 shares issued and outstanding at June 30, 2020 and December 31, 2019, respectively	1,375			1,373
Additional paid in capital	4,469,251			4,458,456
Common stock held in rabbi trust, 91,746 and 77,928 shares at June 30, 2020 and December 31, 2019, respectively	(3,951		)	(3,486		)
Accumulated earnings and dividends	(1,207,645		)	(1,144,721		)
Accumulated other comprehensive loss	(26,465		)	(16,946		)
Total American Campus Communities, Inc. and Subsidiaries stockholders’ equity	3,232,565			3,294,676
Noncontrolling interests – partially owned properties	38,465			43,998
Total equity	3,271,030			3,338,674

Total liabilities and equity	$	7,514,510		$	7,559,754




Consolidated variable interest entities’ assets and debt included in the above balances:

Investments in real estate, net	$	591,263	$	788,393
Cash, cash equivalents and restricted cash	$	36,988	$	59,908
Other assets	$	14,818	$	18,387
Secured mortgage and construction debt, net	$	417,248	$	418,241
Accounts payable, accrued expenses and other liabilities	$	40,071	$	56,976



	Three Months Ended June 30,						Six Months Ended June 30,
	2020			2019			2020			2019
Revenues:
Owned properties	$	177,186		$	203,156		$	409,277		$	427,575
On-campus participating properties	4,101			6,396			14,810			17,844
Third-party development services	1,290			3,607			3,345			6,778
Third-party management services	2,668			3,465			6,497			5,776
Resident services	302			747			1,022			1,529
Total revenues	185,547			217,371			434,951			459,502

Operating expenses (income):
Owned properties	85,749			90,763			178,223			182,932
On-campus participating properties	3,208			3,806			6,574			7,763
Third-party development and management services	4,977			4,513			11,184			8,699
General and administrative	9,767			8,115			19,925			15,430
Depreciation and amortization	66,441			68,815			132,610			137,570
Ground/facility leases	2,893			3,236			6,962			6,785
Loss (gain) from disposition of real estate	—			282			(48,525		)	282
Provision for impairment	—			—			—			3,201
Total operating expenses	173,035			179,530			306,953			362,662

Operating income	12,512			37,841			127,998			96,840

Nonoperating income (expenses):
Interest income	870			969			1,721			1,895
Interest expense	(27,168		)	(27,068		)	(54,951		)	(54,129		)
Amortization of deferred financing costs	(1,255		)	(1,218		)	(2,542		)	(2,350		)
Loss from early extinguishment of debt	—			—			(4,827		)	—
Total nonoperating expenses	(27,553		)	(27,317		)	(60,599		)	(54,584		)

(Loss) income before income taxes	(15,041		)	10,524			67,399			42,256
Income tax provision	(381		)	(314		)	(760		)	(678		)
Net (loss) income	(15,422		)	10,210			66,639			41,578
Net loss (income) attributable to noncontrolling interests	2,078			176			872			(1,552		)
Net (loss) income attributable to ACC, Inc. and Subsidiaries common stockholders	$	(13,344	)	$	10,386		$	67,511		$	40,026

Other comprehensive income (loss)
Change in fair value of interest rate swaps and other	282			(8,593		)	(9,519		)	(14,387		)
Comprehensive (loss) income	$	(13,062	)	$	1,793		$	57,992		$	25,639

Net (loss) income per share attributable to ACC, Inc. and Subsidiaries common shareholders
Basic and diluted	$	(0.10	)	$	0.07		$	0.48		$	0.28

Weighted-average common shares outstanding:
Basic	137,613,560			137,268,696			137,545,365			137,185,576
Diluted	137,613,560			138,243,388			138,652,106			138,198,134



	Six Months Ended June 30,
	2020			2019
Operating activities
Net income	$	66,639		$	41,578
Adjustments to reconcile net income to net cash provided by operating activities:
(Gain) loss from disposition of real estate	(48,525		)	282
Loss from early extinguishment of debt	4,827			—
Provision for impairment	—			3,201
Depreciation and amortization	132,610			137,570
Amortization of deferred financing costs and debt premiums/discounts	379			53
Share-based compensation	8,427			7,509
Income tax provision	760			678
Amortization of interest rate swap terminations and other	855			268
Termination of interest rate swaps	—			(13,159		)
Changes in operating assets and liabilities:
Student contracts receivable, net	4,236			(970		)
Other assets	(3,988		)	(4,723		)
Accounts payable and accrued expenses	(17,304		)	(22,416		)
Other liabilities	(5,781		)	(1,492		)
Net cash provided by operating activities	143,135			148,379

Investing activities
Proceeds from disposition of properties and land parcels	146,144			8,854
Capital expenditures for owned properties	(25,075		)	(24,427		)
Investments in owned properties under development	(156,757		)	(220,925		)
Capital expenditures for on-campus participating properties	(1,166		)	(767		)
Other investing activities	(14,635		)	(2,342		)
Net cash used in investing activities	(51,489		)	(239,607		)

Financing activities
Proceeds from unsecured notes	795,808			398,816
Pay-off of mortgage and construction loans	(34,219		)	—
Costs paid related to early extinguishment of debt	(4,156		)	—
Pay-off of unsecured notes	(400,000		)	—
Proceeds from revolving credit facility	1,456,700			390,200
Paydowns of revolving credit facility	(1,695,900		)	(591,900		)
Proceeds from construction loans	—			26,051
Scheduled principal payments on debt	(3,983		)	(4,017		)
Debt issuance costs	(9,614		)	(6,562		)
Increase in ownership of consolidated subsidiary	(77,200		)	—
Contribution by noncontrolling interests	—			704
Taxes paid on net-share settlements	(4,175		)	(3,975		)
Distributions paid to common and restricted stockholders	(130,435		)	(128,589		)
Distributions paid to noncontrolling interests	(4,850		)	(7,291		)
Net cash (used in) provided by financing activities	(112,024		)	73,437

Net change in cash, cash equivalents, and restricted cash	(20,378		)	(17,791		)
Cash, cash equivalents, and restricted cash at beginning of period	81,348			106,517
Cash, cash equivalents, and restricted cash at end of period	$	60,970		$	88,726

Reconciliation of cash, cash equivalents, and restricted cash to the consolidated balance sheets
Cash and cash equivalents	$	31,011		$	51,541
Restricted cash	29,959			37,185
Total cash, cash equivalents, and restricted cash at end of period	$	60,970		$	88,726


							Accumulated Other Comprehensive (Loss) Income		Noncontrolling Interests – Partially Owned Properties
	General Partner			Limited Partner
	Units	Amount		Units	Amount						Total
Capital, December 31, 2019	12,222	$	40	137,392,530	$	3,311,582	$	(16,946)	$	43,998	$	3,338,674
Adjustments to reflect redeemable limited partners’ interest at fair value	—	—		—	9,490		—		—		9,490
Amortization of restricted stock awards	—	—		—	3,988		—		—		3,988
Vesting of restricted stock awards	—	—		199,695	(4,155)		—		—		(4,155)
Distributions to common and restricted unitholders and other ($0.47 per common unit)	—	(6)		—	(65,236)		—		—		(65,242)

Distributions to noncontrolling joint venture partners	—	—		—	—		—		(2,566)		(2,566)


Change in fair value of interest rate swaps and other	—	—		—	—		(9,801)		—		(9,801)

Net income	—	7		—	80,848		—		895		81,750
Capital, March 31, 2020	12,222	$	41	137,592,225	$	3,336,517	$	(26,747)	$	42,327	$	3,352,138
Adjustments to reflect redeemable limited partners’ interest at fair value	—	—		—	(3,410)		—		—		(3,410)
Amortization of restricted stock awards and vesting of restricted stock units	—	—		27,644	4,439		—		—		4,439
Vesting of restricted stock awards	—	—		—	(20)		—		—		(20)
Distributions to common and restricted unitholders and other ($0.47 per common unit)	—	(5)		—	(65,188)		—		—		(65,193)

Distributions to noncontrolling joint venture partners	—	—		—	—		—		(1,816)		(1,816)


Change in fair value of interest rate swaps and other	—	—		—	—		282		—		282

Net loss	—	(1)		—	(13,343)		—		(2,046)		(15,390)
Capital, June 30, 2020	12,222	$	35	137,619,869	$	3,258,995	$	(26,465)	$	38,465	$	3,271,030
Adjustments to reflect redeemable limited partners’ interest at fair value	—	—		—	(264)		—		—		(264)
Amortization of restricted stock awards	—	—		—	3,502		—		—		3,502

Distributions to common and restricted unitholders and other ($0.47 per common unit)	—	(6)		—	(65,198)		—		—		(65,204)
Contribution by noncontrolling interests - partially owned properties	—	—		—	—		—		6,110		6,110
Distributions to noncontrolling joint venture partners	—	—		—	—		—		(18)		(18)


Change in fair value of interest rate swaps and other	—	—		—	—		1,851		—		1,851

Net loss	—	(2)		—	(19,513)		—		(1,857)		(21,372)
Capital, September 30, 2020	12,222	$	27	137,619,869	$	3,177,522	$	(24,614)	$	42,700	$	3,195,635



									Accumulated			Noncontrolling
									Other			Interests -
	General Partner				Limited Partner				Comprehensive			Partially Owned
	Units	Amount			Units	Amount			(Loss) Income			Properties			Total
Capital, December 31, 2019	12,222	$	40		137,392,530	$	3,311,582		$	(16,946	)	$	43,998		$	3,338,674
Adjustments to reflect redeemable limited partners’ interest at fair value	—	—			—	9,490			—			—			9,490
Amortization of restricted stock awards	—	—			—	3,988			—			—			3,988
Vesting of restricted stock awards	—	—			199,695	(4,155		)	—			—			(4,155		)
Distributions to common and restricted unit holders and other ($0.47 per common unit)	—	(6		)	—	(65,236		)	—			—			(65,242		)
Distributions to noncontrolling joint venture partners	—	—			—	—			—			(2,566		)	(2,566		)
Change in fair value of interest rate swaps and other	—	—			—	—			(9,801		)	—			(9,801		)
Net income	—	7			—	80,848			—			895			81,750
Capital, March 31, 2020	12,222	$	41		137,592,225	$	3,336,517		$	(26,747	)	$	42,327		$	3,352,138
Adjustments to reflect redeemable limited partners’ interest at fair value	—	—			—	(3,410		)	—			—			(3,410		)
Amortization of restricted stock awards and vesting of restricted stock units	—	—			27,644	4,439			—			—			4,439
Vesting of restricted stock awards	—	—			—	(20		)	—			—			(20		)
Distributions to common and restricted unit holders and other ($0.47 per common unit)	—	(5		)	—	(65,188		)	—			—			(65,193		)
Distributions to noncontrolling joint venture partners	—	—			—	—			—			(1,816		)	(1,816		)
Change in fair value of interest rate swaps and other	—	—			—	—			282			—			282
Net loss	—	(1		)	—	(13,343		)	—			(2,046		)	(15,390		)
Capital, June 30, 2020	12,222	$	35		137,619,869	$	3,258,995		$	(26,465	)	$	38,465		$	3,271,030



Earnings per unit:
Net (loss) income attributable to common unitholders - basic and diluted	$	(0.10	)	$	0.07	$	0.48	$	0.28


	September 30, 2020		December 31, 2019
Land	$	654,602	$	654,985
Buildings and improvements	6,934,095		6,749,757
Furniture, fixtures and equipment	412,417		391,208
Construction in progress	310,115		341,554
	8,311,229		8,137,504
Less accumulated depreciation	(1,606,277)		(1,442,789)
Owned properties, net	$	6,704,952	$	6,694,715


	September 30, 2020		December 31, 2019
Debt secured by owned properties:
Mortgage loans payable:
Unpaid principal balance	$	655,050	$	693,584
Unamortized deferred financing costs	(970)		(1,294)
Unamortized debt premiums	3,149		6,596
Unamortized debt discounts	(163)		(199)
	657,066		698,687



Debt secured by on-campus participating properties:
Mortgage loans payable (1)	64,299		65,942
Bonds payable (1)	19,110		23,215
Unamortized deferred financing costs	(347)		(418)

	83,062		88,739
Total secured mortgage, construction and bond debt	740,128		787,426
Unsecured notes, net of unamortized OID and deferred financing costs (2)	2,374,680		1,985,603
Unsecured term loans, net of unamortized deferred financing costs (3)	199,385		199,121
Unsecured revolving credit facility	276,700		425,700
Total debt, net	$	3,590,893	$	3,397,850


⁽¹⁾	~~The creditors of mortgage loans payable and bonds payable related to on-campus participating properties do not have recourse to the assets of the Company.~~



			Emerging growth company			☐



			Emerging growth company			☐


⁽²⁾	Includes net unamortized original issue discount (“OID”) of $6.1 million and $2.3 million at June 30, 2020 and December 31, 2019, respectively, and net unamortized deferred financing costs of $20.1 million and $12.1 million at June 30, 2020 and December 31, 2019, respectively.


⁽³⁾	~~Includes net unamortized deferred financing costs of $0.7 million and $0.9 million at June 30, 2020 and December 31, 2019, respectively.~~


Date Issued	Amount		% of Par Value	Coupon		Yield			Original Issue Discount		Term (Years)
April 2013	$	400,000	99.659	3.750	%	3.791	%		$	1,364	10
June 2014	400,000		99.861	4.125	%	4.269	%	(1)	556		10
October 2017	400,000		99.912	3.625	%	3.635	%		352		10
June 2019	400,000		99.704	3.300	%	3.680	%	(1)	1,184		7
January 2020	400,000		99.810	2.850	%	2.872	%		760		10
June 2020	400,000		99.142	3.875	%	3.974	%		3,432		10
	$	2,400,000							$	7,648


⁽¹⁾	~~The yield includes the effect of the amortization of interest rate swap terminations (see Note 10).~~


Balance, December 31, 2019	$	104,381
Net income	311
Distributions	(234)



Purchase of noncontrolling interests	(77,200)
Adjustments to reflect redeemable noncontrolling interests at fair value	(9,490)
Balance, March 31, 2020	$	17,768
Net loss	(32)
Distributions	(234)



Adjustments to reflect redeemable noncontrolling interests at fair value	3,410
Balance, June 30, 2020	$	20,912
Net loss	(52)
Distributions	(235)





Adjustments to reflect redeemable noncontrolling interests at fair value	264
Balance, September 30, 2020	$	20,889


Balance, December 31, 2018	$	184,446
Net income	259
Distributions	(305)

Conversion of OP Units into shares of ACC common stock	(252)

Adjustments to reflect redeemable noncontrolling interests at fair value	2,547
Balance, March 31, 2019	$	186,695
Net income	163
Distributions	(288)



Adjustments to reflect redeemable noncontrolling interests at fair value	(660)
Balance, June 30, 2019	$	185,910
Net income	150
Distributions	(235)

Conversion of OP Units into shares of ACC common stock	(5,830)
Contributions from noncontrolling interests	250
Change in ownership of consolidated subsidiary	(35,345)
Adjustments to reflect redeemable noncontrolling interests at fair value	12,963
Balance, September 30, 2019	$	157,863



	Number of RSUs
Outstanding at December 31, 2019	—0
Granted	30,137
Settled in common shares	~~(27,644~~(27,644)	)
Settled in cash	~~(2,493~~(2,493)	)
Outstanding at ~~June~~September 30, 2020	—0



	Number of RSAs
Nonvested balance at December 31, 2019	967,341
Granted	443,998
Vested⁽¹⁾	~~(295,385~~(295,385)	)
Forfeited	~~(15,220~~(20,692)	)
Nonvested balance at ~~June~~September 30, 2020	~~1,100,734~~1,095,262



Hedged Debt Instrument	Effective Date	Maturity Date	Pay Fixed Rate	Receive Floating Rate Index	Current Notional Amount		Fair Value
Cullen Oaks mortgage loan	Feb 18, 2014	Feb 15, 2021	2.2750%	LIBOR - 1 month	$	12,300	$	(163	)
Cullen Oaks mortgage loan	Feb 18, 2014	Feb 15, 2021	2.2750%	LIBOR - 1 month	12,426		(165		)
Park Point mortgage loan	Feb 1, 2019	Jan 16, 2024	2.7475%	LIBOR - 1 month	70,000		(6,454		)
College Park mortgage loan	Oct 16, 2019	Oct 16, 2022	1.2570%	LIBOR - 1 month, with 1 day lookback	37,500		(983		)
Unsecured term loan	Nov 4, 2019	Jun 27, 2022	1.4685%	LIBOR - 1 month	100,000		(2,695		)
Unsecured term loan	Dec 2, 2019	Jun 27, 2022	1.4203%	LIBOR - 1 month	100,000		(2,598		)
				Total	$	332,226	$	(13,058	)


	Asset Derivatives					Liability Derivatives
		Fair Value as of					Fair Value as of
Description	Balance Sheet Location	9/30/2020		12/31/2019		Balance Sheet Location	9/30/2020		12/31/2019

Interest rate swap contracts	Other assets	$	0	$	743	Other liabilities	$	11,634	$	3,436

Total derivatives designated as hedging instruments		$	0	$	743		$	11,634	$	3,436



	Three Months Ended June 30,						Six Months Ended June 30,
Description	2020			2019			2020			2019
Change in fair value of derivatives and other recognized in Other Comprehensive Income ("OCI")	$	(1,187	)	$	4,368		$	(11,507	)	$	(1,537	)
Swap interest accruals reclassified to interest expense	1,042			32			1,133			41
Termination of interest rate swap payment recognized in OCI	—			(13,159		)	—			(13,159		)
Amortization of interest rate swap terminations ⁽¹⁾	427			166			855			268
Total change in OCI due to derivative financial instruments	$	282		$	(8,593	)	$	(9,519	)	$	(14,387	)

Interest expense presented in the Consolidated Statements of Operations in which the effects of cash flow hedges are recorded	$	27,168		$	27,068		$	54,951		$	54,129


⁽¹⁾	~~Represents amortization from OCI into interest expense.~~



	Fair Value Measurements as of
	June 30, 2020								December 31, 2019
		Level 2			Level 3		Total		Level 2			Level 3			Total
Assets:
Derivative financial instruments		$	—		$	—	$	—	$	743	⁽¹⁾	$	—		$	743
Liabilities:
Derivative financial instruments		$	13,058	⁽¹⁾	$	—	$	13,058	$	3,436	⁽¹⁾	—			$	3,436
Mezzanine:
Redeemable noncontrolling interests (Company)/Redeemable limited partners (Operating Partnership)		$	17,912	⁽²⁾	$	3,000	$	20,912	$	23,690	⁽²⁾	$	80,691	⁽³⁾	$	104,381


⁽²⁾	Represents the OP Unit component of redeemable noncontrolling interests which is reported at the greater of the fair value of the Company’s common stock or historical cost at the balance sheet date. Represents a quoted price for a similar asset in an active market. Refer to Note 8.


⁽³⁾	Represents the Core Joint Ventures component of redeemable noncontrolling interests which is valued using primarily unobservable inputs, including the Company’s analysis of comparable properties in the Company’s portfolio, estimations of net operating results of the properties, capitalization rates, discount rates, and other market data. Refer to Note 8.



	June 30, 2020									December 31, 2019
				Estimated Fair Value									Estimated Fair Value
	Carrying Amount			Level 2			Level 3			Carrying Amount			Level 2			Level 3
Assets
Loans receivable	$	51,984		$	—		$	48,307	⁽¹⁾	$	50,553		$	—		$	48,307	⁽¹⁾
Liabilities ⁽²⁾
Unsecured notes	$	2,373,767		$	2,431,498	⁽³⁾	$	—		$	1,985,603		$	2,069,817	⁽³⁾	$	—
Mortgage loans payable (fixed rate)	$	721,407	⁽⁴⁾	$	770,468	⁽⁵⁾	$	—		$	761,296	⁽⁴⁾	$	766,821	⁽⁵⁾	$	—
Bonds payable	$	23,033		$	25,375	⁽⁶⁾	$	—		$	23,001		$	25,110	⁽⁶⁾	$	—
Unsecured term loan (fixed rate)	$	199,297		$	204,446	⁽⁷⁾	$	—		$	199,121		$	198,687	⁽⁷⁾	$	—


⁽¹⁾	~~Valued using a discounted cash flow analysis with inputs of scheduled cash flows and discount rates that a willing buyer and seller might use.~~


⁽²⁾	~~Carrying amounts disclosed include any applicable net unamortized OID, net unamortized deferred financing costs, and net unamortized debt premiums and discounts (see Note 6).~~


⁽³⁾	~~Valued using interest rate and spread assumptions that reflect current creditworthiness and market conditions available for the issuance of unsecured notes with similar terms and remaining maturities.~~


⁽⁴⁾	~~Does not include 1 variable rate mortgage loan with a principal balance of $2.6 million as of June 30, 2020 and $3.1 million as of December 31, 2019.~~