American Campus Communities Announces Agreement to Acquire Royal Properties Portfolio.

AUSTIN, Texas -- American Campus Communities, Inc. (NYSE:ACC), one of the nation's largest owners, managers and developers of high-quality student housing properties, today announced the execution of an agreement to acquire Royal Properties' student housing portfolio. The portfolio consists of 13 existing properties located in 10 markets containing 5,710 beds. The contribution value in the agreement is approximately $245 million, which we anticipate will be paid with 3,250,000 Operating Partnership Units and the remainder in cash and assumed debt, although Royal may elect to take a lower percentage of the consideration mix in units prior to the end of the due diligence period. The portfolio is being acquired at a fully loaded cap rate of approximately 6.25 percent. ACC expects to assume approximately $124.2 million in property level debt with a weighted average interest rate of 5.95 percent and an average remaining term of 6.6 years. ACC will also have a right of first offer on all future student housing properties developed by Royal Properties. As part of the transaction, Michael J. Henneman, chairman of Royal Properties, will join ACC's board of directors at closing.

The company has also entered into an agreement to acquire a development property located in Waco, Texas from Royal Properties that is currently under construction. The development property consists of 543 beds and is valued at $24.8 million.

"We have a great deal of respect for Royal Properties. They built, managed, and maintained these assets for long-term ownership. They have historically achieved strong occupancies and annual rental rate escalations that have consistently yielded revenue growth," said Bill Bayless, ACC CEO. "This portfolio meets our stringent investment criteria and should achieve 3 to 4 percent annual NOI growth. We also welcome the industry experience and vantage point that Michael Henneman will bring to our board of directors."

The portfolio's assets are predominately located in major university markets with 10 of the properties located in the nation's top 10 college enrollment growth states. The communities average approximately five years in age with infill locations in established submarkets with barriers to entry. The properties' average distance to campus is 0.5 miles.

"We are excited about the opportunity to contribute our portfolio to ACC in exchange in part for ACC units. As an industry insider, we have a great appreciation for their disciplined investment strategy and operational expertise and capabilities," said Michael Henneman. "Once we determined that a contribution in exchange for units was the most efficient way to monetize our portfolio, ACC was the only company we seriously considered. We believe that our portfolios fit well together and we look forward to being stakeholders in the company."

Common units received by Royal Properties will be valued at our average share price for the four months preceding the end of the due diligence period, with a minimum of $22.50 and a maximum of $23.50 per common unit.

The Royal Properties portfolio is comprised of:

--Entrada Real, University of Arizona, 367 beds

--Royal Oaks, Florida State University, 224 beds

--Royal Pavilion, Florida State University, 204 beds

--Royal Village, Florida State University, 288 beds

--Royal Village, University of Florida, 445 beds

--Northgate Lakes, University of Central Florida, 710 beds

--Royal Lexington, University of Kentucky, 341 beds

--The Woods at Greenland, Middle Tennessee State University, 273 beds

--Raider's Crossing, Middle Tennessee State University, 265 beds

--Raiders Pass, Texas Tech University, 829 beds

--Aggie Station, Texas A&M University, 450 beds

--The Outpost, Texas State University - San Marcos, 486 beds

--The Outpost, University of Texas - San Antonio, 828 beds

The consummation of these transactions is subject to a number of contingencies, including lender approval of the assumption of debt and ACC's satisfactory completion of its evaluation of the assets and other due diligence. ACC may terminate either agreement prior to the expiration of the 60-day due diligence period without penalty. There can be no assurance that ACC will consummate any transaction contemplated by the agreements or that the due diligence periods will not be extended. Subject to the completion of these contingencies, the acquisition of the 13 existing properties is expected to close during the latter part of the first quarter of 2006. Upon consummation of this transaction, ACC will own 38 student housing communities containing approximately 22,810 beds. Including its owned properties, the company will provide management and leasing services at a total of 56 properties with more than 33,410 beds.

Merrill Lynch & Co. served as ACC's financial advisor, and Locke Liddell & Sapp LLP served as ACC's legal advisor in the transaction.

About American Campus Communities

American Campus Communities Inc. is one of the largest developers, owners and managers of high-quality student housing communities in the United States. The company is a fully integrated, self-managed and self-administered equity real estate investment trust (REIT) with expertise in the design, finance, development, construction management, leasing and management of student housing properties. American Campus Communities owns and manages a portfolio of 25 student housing communities containing approximately 17,100 beds. Including its owned properties, the company provides management and leasing services at a total of 43 properties with more than 27,700 beds located on or near college and university campuses. Additional information is available at www.americancampuscommunities.com.

Forward-Looking Statements

This release contains forward-looking statements, which express the current beliefs and expectations of management. Such statements are based on current expectations and involve a number of known and unknown risks and uncertainties that could cause our future results, performance or achievements to differ significantly from the results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements speak only as of the date on which they are made, and we undertake no obligation to update publicly or revise any forward-looking statement, whether as a result of new information, future development or otherwise.