Sun Communities, Inc. · NYSE:SUI

Sun Communities — Investor Presentation (September 2021)

27 slides from Sun Communities's investor presentation, Sep 13, 2021

  1. Slide 1: Investor Presentation September 13, 2021

    INVESTOR PRESENTATION SEPTEMBER 13, 2021 CYPRESS GREENS – LAKE ALFRED, FL

  2. Slide 2: Forward-looking statements disclaimer

    2 This presentation has been prepared for informational purposes only from information supplied by Sun Communities, Inc., referred to herein as “we,” “our,” “Sun,” and “the Company,” and from third-party sources indicated herein. Such third-party information has not been independently verified. Sun

  3. Slide 3: Company Highlights

    COMPANY HIGHLIGHTS 3Source: Company information. Refer to Sun Communities, Inc. Form 10-Q and Supplemental for the quarter ended June 30, 2021, as well as Press Releases and SEC Filings after June 30, 2021, for additional information. Leading owner and operator of manufactured housing (“MH”) communi

  4. Slide 4: Sun Communities, Inc. Overview

    583 properties across 38 states, Ontario, Canada and Puerto Rico 4 Current Portfolio as of September 13, 2021 Proforma Rental Revenue Breakdown SUN COMMUNITIES, INC. OVERVIEW (NYSE: SUI) Property Count as of September 13, 2021 Source: Company information. Refer to Sun Communities, Inc. Form 10-Q and

  5. Slide 5: YTD 2021 Business Update

    5 YTD 2021 BUSINESS UPDATE PORTFOLIO PERFORMANCE EXTERNAL GROWTH • 2021 full-year Same Community NOI growth guidance range increased by 230 bps to 9.9% - 10.7% • Gained 1,097 revenue producing sites YTD • Same Community 4th of July Weekend transient RV revenue up 35% & Labor Day Weekend up ~30% comp

  6. Slide 6: Powering Sun's Growth Engine - Internal

     Sun is the premier owner and operator of MH and RV communities  Strong cycle-tested record of operating, expanding and acquiring MH and RV communities dating back to 1975 6 POWERING SUN’S GROWTH ENGINE - INTERNAL INTERNAL LEVERS Contractual Rent Increases MH Occupancy Gains Expansions Transient R

  7. Slide 7: Powering Sun's Growth Engine - External

    EXTERNAL LEVERS Development 7 POWERING SUN’S GROWTH ENGINE - EXTERNAL Acquisitions ~$4.1bn investment in 166 properties since start of 2020 4.3x increase in properties since year end 2010 Targeting 2 - 4 new development project starts / year Over 1,350 2020 – 2021 YTD ground-up site deliveries in 8

  8. Slide 8: 2020-2021 Acquisition & Development Activity

    2020-2021 ACQUISITION & DEVELOPMENT ACTIVITY 8 2 ~$4.1bn purchase price Acquisitions Ground-up & Redevelopments Expansions Investment Activity Summary(1) ~57,500 sites added in 166 properties & marinas Robust pipeline of small portfolios and single assets in underwriting $226mm invested Opened 2 new

  9. Slide 9: Sticky Customer Base with Limited Capex

    STICKY CUSTOMER BASE WITH LIMITED CAPEX 9 HOMOSASSA RIVER – HOMOSASSA SPRINGS, FL  Annual home move-outs in Sun’s MH communities are less than 1% ꟷ Low turnover driven by a $6k - $10k average cost to resident to move a home ꟷ Average tenure of residents in our MH communities is ~14 years(1)  RVs s

  10. Slide 10: Consistent and Cycle Tested Cash Flow Growth

    Multi-Family REITsSun Communities CONSISTENT AND CYCLE TESTED CASH FLOW GROWTH 10  Favorable demand drivers, high barriers to entry and Sun’s investment and operational prowess have resulted in consistent and cycle tested organic cash flow growth  Over at least the past 20 years, every individual

  11. Slide 11: Renting - MH vs. Other Rental Options

    11 RENTING – MH VS. OTHER RENTAL OPTIONS  Manufactured homes in Sun’s communities provide 25% more space at ~50% less cost per square foot Manufactured Homes in Sun’s Communities RENT   $1,076 per month Other Rental Options(1) $1,799 per month SQUARE FOOTAGE PRICE 1,250 sq. ft. 1,000 sq. ft. $0.

  12. Slide 12: Homeownership - MH vs. Single Family

    HOMEOWNERSHIP – MH VS. SINGLE FAMILY 12 Single Family HomesManufactured Homes  Average cost of Single Family is $308,597 or roughly 7 years median income  Average cost of a new Manufactured Home is $87,000 or roughly 2 years median income Average Household Income ~$44k(1) Sources: U.S. Department

  13. Slide 13: Expansions Provide Attractive Returns

    13 EXPANSIONS PROVIDE ATTRACTIVE RETURNS SHERKSTON SHORES – SHERKSTON, ON  Investment in expansion sites boosts growth in highly accretive manner  Sun expands in communities and resorts with high occupancies and continued strong demand Over 6,100 vacant expansion site deliveries since 2015 12 - 24

  14. Slide 14: Maximizing Value from Strategic Acquisitions

     Since 2010, Sun has acquired properties valued at over $9.2 billion, increasing its number of properties by 4.3x Professional Operational Management Home Sales & Rental Program Skilled Expense Management Call Center & Digital Marketing Outreach Repositioning with Additional Capex Adding Value with

  15. Slide 15: Strategic Balance Sheet

    28.2% 25.2% 19.0% 21.4% 16.8% 2017 2018 2019 2020 2Q21 2021 2022 2023 2024 2025 Fannie Mae CMBS Freddie Mac Life Companies $50.5 $0 $315.3 $185.6 $82.2 6.3x 5.6x 5.5x 6.9x 5.1x 2017 2018 2019 2020 2Q21 STRATEGIC BALANCE SHEET 15 Net Debt / TEV(5) Quarter Ended June 30, 2021 Principal Outstanding(2)

  16. Slide 16: Sun Communities' ESG Initiatives

    Environmental SUN COMMUNITIES’ ESG INITIATIVES 16 ESG Highlights(1)  We are committed to sustainable business practices to benefit all stakeholders: team members, residents and guests, shareholders and the broader communities where we operate  We will continue to enhance Sun’s sustainability progr

  17. Slide 17: Strategy-Driven Outperformance

    STRATEGY-DRIVEN OUTPERFORMANCE 17  Sun has significantly outperformed major REIT and broader market indices over the last ten years Sun Communities, Inc. (SUI) MSCI US REIT (RMS)S&P 500 2021 YTD Total Return 5-year Total Return 10-year Total Return 3-year Total Return Source: S&P Global as of Augus

  18. Slide 18: Best Performance Among Real Estate Sectors

    $140 Shopping Centers BEST PERFORMANCE AMONG REAL ESTATE SECTORS 18  Sun has proven its strategy through recession resilience and consistent outperformance of multi-family in terms of same community NOI growth since 2000 Indexed Same Community NOI Growth Source: Citi Research, June 2021. (1) Multi-

  19. Slide 19: Appendix

    APPENDIX FRIENDLY VILLAGE OF SIMI VALLEY – SIMI VALLEY, CA

  20. Slide 20: Non-GAAP Terms Defined

    NON-GAAP TERMS DEFINED 20 Investors in and analysts following the real estate industry utilize funds from operations (“FFO”), net operating income (“NOI”), and earnings before interest, tax, depreciation and amortization (“EBITDA”) as supplemental performance measures. The Company believes that FFO,

  21. Slide 21: Sun's Internal and External Operational Growth

    5.5% 5.9% 7.7% 9.1% 7.1% 6.9% 6.7% 7.3% 4.0% 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021E $314 $182 $744 $1,143 $1,769 $145 $364 $815 $2,979 $1,085 2012 2013 2014 2015 2016 2017 2018 2019 2020 YTD2021 SUN’S INTERNAL AND EXTERNAL OPERATIONAL GROWTH Total New and Pre-Owned Homes Sales Ground-Up

  22. Slide 22: Healthy Balance Sheet and High Returns

    $39.89 $42.64 $60.46 $68.53 $76.61 $92.78 $101.71 $150.10 $151.95 $201.49 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 8.4x 7.2x 7.3x 6.6x 7.5x 6.3x 5.6x 5.5x 6.9x 5.1x 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 $3.05 $3.22 $3.37 $3.63 $3.79 $4.17 $4.58 $4.92 $5.09 $6.31 2012 2013 2014 2

  23. Slide 23: Safe Harbor is the Premier Marina Operator

    90% 88% 85% 81% 77% South Southeast Northeast Midwest Southwest SAFE HARBOR IS THE PREMIER MARINA OPERATOR Unrivaled Among Competitors 120 Owned Marinas 33,800 Approximate Wet Slips 23 States & Puerto Rico 79% of Marinas Located in Coastal Markets(3) 44,000 Approximate Members 7.6 Years Average Memb

  24. Slide 24: Marina Sector Pioneer and Consolidator

    MARINA SECTOR PIONEER AND CONSOLIDATOR 24 Key Transactions(1) 1 3Q 2015 Date Acquired Flagship(2) 2 3 4 5 6 7 7 Marinas 4,717 Slips / Dry Storage Spaces (1) Date acquired reflects period in which last marina acquisition closed. (2) Properties acquired prior to Sun Communities’ acquisition of Safe Ha

  25. Slide 25: Net Income to FFO Reconciliation

    NET INCOME TO FFO RECONCILIATION 25 (amounts in thousands except per share data) Source: Company information. Refer to Sun Communities, Inc. Form 10-Q and Supplemental for the quarter ended June 30, 2021, as well as Press Releases and SEC Filings after June 30, 2021, for additional information. 2021

  26. Slide 26: Net Income to NOI Reconciliation

    NET INCOME TO NOI RECONCILIATION 26 (amounts in thousands) Source: Company information. Refer to Sun Communities, Inc. Form 10-Q and Supplemental for the quarter ended June 30, 2021, as well as Press Releases and SEC Filings after June 30, 2021, for additional information. 2021 2020 2021 2020 2020 2

  27. Slide 27: Net Income to Recurring EBITDA Reconciliation

    NET INCOME TO RECURRING EBITDA RECONCILIATION 27 (amounts in thousands) Source: Company information. Refer to Sun Communities, Inc. Form 10-Q and Supplemental for the quarter ended June 30, 2021, as well as Press Releases and SEC Filings after June 30, 2021, for additional information. 2021 2020 202

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