Preferred Apartment Communities, Inc. announced that on October 27, 2017 it converted a portion of the outstanding principal balance of its real estate loan investment along with an additional equity investment into an approximate 98.0% equity ownership interest in a joint venture that owns a 198-unit, 792-bed student housing community.  This student housing community is located near Kennesaw State University in the Atlanta, Georgia MSA and is named Stadium Village.  PAC's 98.0% equity ownership interest is held through its indirect, wholly-owned subsidiary Preferred Campus Communities, LLC.

The developers will maintain an equity ownership interest in the joint venture, and Preferred Campus Management, LLC, a dedicated manager of student housing communities and a wholly-owned subsidiary of Preferred Apartment Advisors, LLC, the Company's external manager, will manage the business and operations for the joint venture.  "We are excited about Stadium Village and its attractive student-centered amenities. This is a great asset with excellent long-term potential value near a thriving university," said Paul Cullen, Chief Executive Officer of Preferred Campus Communities, LLC.  Mr. Cullen added, "Since stabilization, the property has operated close to 100% occupancy."

In connection with the conversion, Stadium Village was refinanced, utilizing a non-recourse first mortgage loan from Prudential Affordable Mortgage Company, LLC.  The first mortgage loan is approximately $47.0 million, bears interest at a fixed interest rate of 3.80% per annum, has a seven-year term and amortizes based on a 30-year schedule. There are no loan guaranties provided by PAC or our operating partnership.