Sun Communities, Inc. · NYSE:SUI
Sun Communities — Investor Presentation (September 2014)
24 slides from Sun Communities's investor presentation, Sep 9, 2014
Slide 1: September 2014
September 2014 Pe. Rone! eee Lake Sagem fie Naples sel mf a Ae a 1 Lake Laurie - Capejpay, NU
Slide 2: Forward-looking statements disclaimer
2 This presentation has been prepared for informational purposes only from information supplied by Sun Communities, Inc. (the "Company") and from third-party sources indicated herein. Such third-party information has not been independently verified. The Company makes no representation or warranty, e
Slide 3: Sun Communities, Inc. (NYSE:SUI)
3 SUN COMMUNITIES, INC. (NYSE:SUI) Leading owner, developer and manager of manufactured housing (“MH”) and recreational vehicle (“RV”) sites Sun Communities’ portfolio includes 184 communities consisting of approximately 69,600 sites across 27 states 151 MH communities and 33 RV resorts 51,5
Slide 4: Affordability Drives Manufactured Housing: vs. Multifamily
4 Comparing all manufactured homes to the multifamily average, a manufactured home provides approximately 35% more space at approximately 40% less cost per square foot. AFFORDABILITY DRIVES MANUFACTURED HOUSING Sun – Manufactured Homes Apartments • Average rent ≈ $800/month or $0.62/square foot • Av
Slide 5: Affordability Drives Manufactured Housing: vs. Single Family
5 AFFORDABILITY DRIVES MANUFACTURED HOUSING Manufactured Housing vs. Single Family: • Average cost of Manufactured Housing ≈ $64,000 or roughly 1 years income • Average cost of Single Family ≈ $324,500 or roughly 5 years income The median income in the 27 states in which Sun operates is $65.3K. The
Slide 6: Stability of Revenue
6 STABILITY OF REVENUE Stable and growing revenue due to: Low turnover of owner occupied sites due to high cost to move a home ($4,000-$10,000) Average tenure of our residents in our communities is 13 years Average term of home in our communities is approximately 40 years Move Outs and Re-Sale
Slide 7: Capital Expenditures
7 CAPITAL EXPENDITURES Manufactured housing is a low capex business relative to its peers as it is largely a land ownership business. Source: Company filings Data as of 12/31/2013 Capex as a % of Revenues
Slide 8: Recession Resistant
8 RECESSION RESISTANT Low annual resident turnover results in stability of income and occupancy Strong and consistent rental growth creating a stable revenue stream Occupancy gains are a function of Sun’s integrated platform, including leasing, sales, and financing $ in M ill io n s Same Site
Slide 9: Same Site NOI
9 SAME SITE NOI Sun’s average same site NOI growth has exceeded the industry average by 1.5% over a 15 year period. -9.0% -8.0% -7.0% -6.0% -5.0% -4.0% -3.0% -2.0% -1.0% 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0% 9.0% 10.0% 11.0% 1Q 99 2Q 99 3Q 99 4Q 99 1Q 00 2Q 00 3Q 00 4Q 00 1Q 01 2Q 01 3Q 01 4Q
Slide 10: Same Site Indexed NOI Growth
10 Source: SNL SAME SITE INDEXED NOI GROWTH MH is the most recession resistant sector of the housing and commercial real estate sectors and has consistently outperformed multifamily in same site NOI growth since 2000.
Slide 11: Growth Through Accretive Acquisitions
11 2012 Acquisitions (11 Communities) 2011 Acquisitions (26 Communities) 10 15 20 25 30 35 Year 1 Year 2 Year 3 $$ M ill io n s Revenues NOI 15 20 25 30 35 40 Year 1 Year 2 $$ M ill io n s Revenues NOI GROWTH THROUGH ACCRETIVE ACQUISITIONS Since June 2011, Sun has completed over $813 million of acqu
Slide 12: Acquisition of the American Land Lease Portfolio from Green Courte Partners
ACQUISITION OF THE AMERICAN LAND LEASE PORTFOLIO FROM GREEN COURTE PARTNERS 12
Slide 13: Transaction Overview
TRANSACTION OVERVIEW Transaction Acquisition of the American Land Lease or “ALL” portfolio(1) of primarily age-restricted manufactured home communities from Green Courte Partners (“GCP”) 59 pure-play manufactured home communities 19,504 home sites ‒ 14,245 (73%) age-restricted sites ‒ 5,259 (2
Slide 14: A Compelling Portfolio Opportunity
A Compelling Portfolio Opportunity Irreplaceable portfolio in high-barrier, sought after markets Large, well-located high-quality communities with attractive amenities Portfolio with potential for occupancy and rent growth Significant age-restricted nature of portfolio allows SUI to capture
Slide 15: Irreplaceable Portfolio with High-Quality Assets
Age- Restricted 73% All-Age 27% IRREPLACEABLE PORTFOLIO WITH HIGH-QUALITY ASSETS Source: Company as of 7/23/2014. 1) Excludes one additional property comprising 198 sites, which SUI has a contract to purchase for $15.8 million. Age-Restricted Properties 41 communities 14,245 sites All-Age Properties
Slide 16: Acquisition Would Increase SUI's Scale and Diversification
ACQUISITION WOULD INCREASE SUI’s SCALE AND DIVERSIFICATION Total Enterprise Value (1) $3.8 billion $1.3 billion $5.1 billion Number of Communities 184 (2) 59 (3) 243 Occupancy 92% (2) 90% (3) 91% Number of Sites 69,578 (2) 19,504 (3) 89,082 Avg. Monthly Rent / Site $444 (2) $454 (3) $446 Geographic
Slide 17: Property Dispositions
17 PROPERTY DISPOSITIONS In the past 8 months, Sun has disposed of ten communities for approximately $60 million. Sun expects to sell two additional properties in the third or fourth quarter of 2014 for approximately $24 million. 14 additional properties have been identified for potential sale
Slide 18: Growth Through Expansion Opportunities
GROWTH THROUGH EXPANSION OPPORTUNITIES Inventory of over 6,200 zoned and entitled sites available for expansion at 36 communities Expanding in communities with strong demand evidenced by occupancy of ~95% Expansion lease-up is driven by sales, rental and relocation programs 450 sites expecte
Slide 19: Strategic Balance Sheet Management
19 STRATEGIC BALANCE SHEET MANAGEMENT Financial flexibility has positioned Sun to de-lever substantially while expanding via acquisitions. EQUITY Raised over $764.0 million of common equity, primarily through four successful follow-on offerings in January and September 2012, March 2013 and March 2
Slide 20: Conservative Balance Sheet
20 CONSERVATIVE BALANCE SHEET Net Debt1 / Enterprise Value EBITDA / Interest Debt + Preferred Equity / EBITDA* (1) Including preferred OP units *Calculated based on trailing 12 months ended June 30, 2014 Fixed Debt (%)
Slide 21: Experienced and Proven Leadership Team
21 EXPERIENCED AND PROVEN LEADERSHIP TEAM Key executives have a combined 80 years experience in the industry and over 65 years at the company. Senior Management team has combined experience of over 70 years at the company. Gary A. Shiffman - Chairman and Chief Executive Officer Karen J. Dearing - Ch
Slide 22: Pond - Sandwich, MA
Pond - Sandwich, MA Al i = eM = Lakeybaurie De Ye SUN COMMUNITIES, INC
Slide 23: Performance vs. Indices
542% 312% 296% 291% 270% 251% 237% 0% 100% 200% 300% 400% 500% 600% SUI SNL US REIT Manufactured Homes SNL US REIT Equity MSCI US REIT (RMS) S&P Small-Cap Russell 2000 S&P 500 PERFORMANCE VS. INDICES SUI has significantly outperformed many major market indices over the last five years. Source: SNL
Slide 24: Performance vs. REIT Sectors
542% 408% 348% 342% 335% 319% 312% 280% 274% 264% 263% 0% 100% 200% 300% 400% 500% 600% SUI Shopping Malls Self-Storage Retail Multifamily Hotel Manufactured Housing Industrial Office Strip Malls Healthcare PERFORMANCE VS. REIT SECTORS Source: SNL SUI has outperformed most major REIT sector indice
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