Acquisition of Delta Centre-Ville Hotel
Campus Crest Communities, Inc. (NYSE:CCG) and Beaumont Partners SA (“Beaumont”) today announced a joint venture partnership that acquired the 711 room, 33-story Delta Centre-Ville Hotel in downtown Montréal, Québec with plans to convert it into an upscale student housing tower.
The joint venture, which is owned 20% by Campus Crest and 80% by Beaumont, paid approximately $60 million for the property, including closing costs, fees and reserves. The partnership expects to obtain redevelopment financing later this year to fund the conversion of the hotel into an upscale student housing tower featuring a mix of single and double units. The redevelopment of the tower is slated to be completed for the fall of 2014, with leasing to begin in the fall of 2013.
“We are excited to align ourselves with Beaumont to acquire an asset in an irreplaceable location in the heart of downtown Montréal at discount to replacement cost,” said Ted W. Rollins, Co-Chairman of the Board and Chief Executive Officer of Campus Crest. “We have been evaluating the Canadian market for years and believe this is the right opportunity with the right partner to bring our unique brand of student housing to our North American neighbors. Not only will this allow us to expand our operational footprint, but we will be entering one of Canada’s most prestigious academic cities with a rich cultural heritage and serving nearly 200,000 students.”
“The Delta Centre-Ville Hotel acquisition provides a unique entry point to the Canadian student housing market,” said Toby Selman, Managing Director of the Real Estate Group of Beaumont Partners. “We believe that Campus Crest is the natural partner for us and immediately positions us as a leader in the Montréal market. We look forward to significant additional investment in Montréal and expanding our relationship with Campus Crest here as well as in other Canadian markets.”
Situated above the Square-Victoria Metro Station stop, the Montréal acquisition offers easy access to McGill University, Concordia University and L’École de Technologie Supérieure (ÉTS), a part of the Université du Québec network, which collectively serve more than 81,500 full-time students. The property is conveniently located in the heart of downtown Montréal, within walking distance of Old Montréal, the Bell Centre sports and entertainment complex, the Central Train Station and numerous dining and cultural attractions. Once completed, the property will include a broad array of high-end appointments and expects to attract undergraduate and graduate students by offering an upscale housing alternative with modern, attractively furnished rooms and a range of amenities including a media lounge, fitness center, library and a technology center. Ample common areas including numerous study lounges will be designed to accommodate social and academic interaction. To foster a sense of community and promote resident engagement, the property will regularly host a variety of activities. Residents will be served by a highly trained, professional staff that includes a general manager, leasing manager, community assistants and a courtesy officer for security purposes. As part of the joint venture agreement, Campus Crest will serve as property manager.
In addition to marking Campus Crest’s entry into Canada, the project is the Company’s second urban, high-rise development. In February, Campus Crest announced a joint venture partnership to develop a 33-story, 850-bed student housing tower in University City, Philadelphia, which is also targeted for completion in the fall of 2014.
Source: Campus Crest Communities, Inc. (http://www.snl.com/IRWebLinkX/file.aspx?iid=4258761&fid=18117191)