Slide 1: Sun Communities, Inc.
SUN COMMUNITIES, INC
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 193 communities consisting of approximately 72,000 sites across 27 states 161 MH communities: 54,300 sites 12 ble
Slide 4: Geographically Diversified Portfolio
4 GEOGRAPHICALLY DIVERSIFIED PORTFOLIO 2014 Acquisitions: • Saco/Old Orchard Beach KOA • Seashore Campsites RV and Campground • Driftwood Camping Resort • Castaways RV Resort & Campground • Wine Country RV Resort As of June 1, 2014
Slide 5: Affordability Drives Manufactured Housing: vs. Multifamily
5 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 ≈ $801/month or $0.62/square foot • Av
Slide 6: Affordability Drives Manufactured Housing: vs. Single Family
6 AFFORDABILITY DRIVES MANUFACTURED HOUSING Manufactured Housing vs. Single Family: • Average cost of Manufactured Housing ≈ $61,900 or roughly 1 years income • Average cost of Single Family ≈ $292,200 or roughly 4 years 5 months income The median income in the 27 states in which Sun operates is $65
Slide 7: Stability of Revenue
7 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 8: Capital Expenditures
8 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 9: Recession Resistant
9 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 10: Revenue Allocation
10 *Based on midpoint of 2014 guidance. REVENUE ALLOCATION Revenues from home sales 13% Rental home revenue 8% Ancillary revenues, net 2% Interest and other income 3% Income from real property 74% Projected 2014 Revenues* 87% 86% 84% 82% 11% 10% 10% 10% 2% 4% 6% 8% 70% 75% 80% 85% 90% 95% 100% 2011
Slide 11: Same Site NOI Growth vs. REIT Sectors
11 Source: Citi Investment research, May 2014. “REITs”- includes an index of REITs across a variety of asset classes including self storage, mixed office, regional malls, shopping centers, multifamily, student housing, manufactured homes and specialty Source: SNL SAME SITE NOI SAME SITE INDEXED NOI
Slide 12: Growth Through Accretive Acquisitions
12 GROWTH THROUGH ACCRETIVE ACQUISITIONS Since June 2011, Sun has completed over $774 million of acquisitions, increasing its number of sites and communities by 50% and 42%, respectively, diversifying from both a business segment and geographic perspective. Seeking opportunities with: Potential to
Slide 13: Strong Acquisition Performance
13 STRONG ACQUISITION PERFORMANCE 2012 Acquisitions 2011 Acquisitions Properties Acquired: • Orange City RV Resort (FL) – May • Kentland Acquisition (18 Properties - MI) – June • Morgan Acquisition (6 Properties - FL) – December 2011 & February 2012 • Cider Mill Crossings (MI) – September Properties
Slide 14: Growth Through Expansion Opportunities
14 GROWTH THROUGH EXPANSION OPPORTUNITIES Inventory of over 6,100 zoned and entitled sites available for expansion at 33 communities Expanding in communities with strong demand evidenced by occupancy of ~95% Expansion lease-up is driven by sales, rental and relocation programs Over 750 sites
Slide 15: Strategic Balance Sheet Management
15 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 16: Conservative Balance Sheet
16 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 March 31, 2014 Fixed Debt (%)
Slide 17: Company Highlights
17 Superior total return performance Strong portfolio management as reflected by continuously improving operating metrics Sound balance sheet management and improving credit metrics Solid external growth strategy in highly-fragmented sector Wide access to various capital sources COMPANY HI
Slide 18: Appendices
APPENDICES Castaways RV Resort = Berlin, MD. = Rainbow RV Resort - Frostpr SUN COMMUNITIES, INC
Slide 19: Performance vs. Indices
PERFORMANCE VS. INDICES SUI has significantly outperformed many major market indices since the market crash in 2009. Source: SNL 19 5-year Total Returns by Index as of 3/31/2014 492% 258% 254% 220% 198% 197% 161% 0% 100% 200% 300% 400% 500% 600% SUI SNL US REIT Equity MSCI US REIT (RMS) S&P Small-
Slide 20: Performance vs. REIT Sectors
PERFORMANCE VS. REIT SECTORS Source: SNL SUI has outperformed most major REIT sector indices over a 5 year period 20 5-year Total Returns by REIT Sector as of 3/31/2014 492% 400% 347% 310% 282% 248% 244% 218% 198% 194% 192% 0% 100% 200% 300% 400% 500% 600% SUI Hotel Retail Self-Storage Multifamily