Sun Communities, Inc. · NYSE:SUI
Sun Communities — Investor Presentation (June 2019)
21 slides from Sun Communities's investor presentation, Jun 3, 2019
Slide 1: Investor Presentation June 2019
VALLECITO – NEWBURY PARK, CA INVESTOR PRESENTATION JUNE 2019
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS This presentation has been prepared for informational purposes only from information supplied by Sun Communities, Inc. (the “Company” or “Sun”) and from third- party sources indicated herein. Such third-party information has not been independently verified. The Company mak
Slide 3: Sun Communities, Inc. (NYSE: SUI) Overview
SUN COMMUNITIES, INC. (NYSE: SUI) OVERVIEW Current Portfolio as of March 31, 2019 4,963 379 communities 226 1,916 consisting of over 1,078 475 588 2,118 705 28,388 671 132,000 sites across 149 413 1,517 324 2,920 2,916 31 states and Ontario, 2,150 562 3,608 1,207 2,446 7,924 1,376 976 1,084 Canada 6
Slide 4: Operating and Financial Highlights
OPERATING AND FINANCIAL HIGHLIGHTS Financial Performance Quarter Ended March 31, ALTA LAGUNA – CUCAMONGA, CA 2019 2018 % Change Total Revenue $287.3mm $258.0mm 11.4% Total NOI $164.4mm $149.1mm 10.3% Same Community Revenue $199.1mm $187.8mm 6.0% Same Community NOI $141.3mm $131.7mm 7.2% EPS1 $0.40 $
Slide 5: 2019 Community Acquisitions
2019 COMMUNITY ACQUISITIONS . Acquired 8 communities across 7 states with ~3,900 developed sites and 70 additional sites for expansion as of May 31, 2019, totaling ~$348mm. 2 1 1 321 518 2 1,308 1 291 Acquisition Useable 1 Date Community Name Type State Sites 309 1 400 1/3/2019 Hacienda Del Rio MH F
Slide 6: Powering Sun's Growth Engine
POWERING SUN’S GROWTH ENGINE . Sun is the premier owner and operator of manufactured home (“MH”) and recreational vehicle (“RV”) communities . Strong cycle-tested record of operating, expanding and acquiring MH and RV communities dating back to 1975 INTERNAL EXTERNAL Contractual Rent Increases MH Oc
Slide 7: Sun's Favorable Revenue Drivers
SUN’S FAVORABLE REVENUE DRIVERS MH Resident Move-out Trends1 . Yearly home move-outs in our MH communities is less than 1% 6.2% . Tenure of residents in our MH communities is 0.8% approximately 141 years Resident Re-sales Resident Move-outs (Home stays in community) (Home leaves community) FRIENDLY
Slide 8: Consistent and Cycle Tested Internal Growth
CONSISTENT AND CYCLE TESTED INTERNAL GROWTH . Sun’s average same community NOI growth has exceeded REIT industry average by ~190 bps and the apartment sector’s average by ~180 bps since 1998 . Since 1998, every individual year or rolling 4-quarter period has had positive same community NOI growth Sa
Slide 9: Manufactured Housing vs. Other Rental Options
MANUFACTURED HOUSING VS. OTHER RENTAL OPTIONS . Sun’s manufactured homes provide nearly 25% more space at ~48% less cost per square foot Sun’s Manufactured Other Rental Homes1 VS. Options2 PRICE $0.77 per sq. ft. $1.47 per sq. ft SQUARE FOOTAGE 1,250 sq. ft. 1,000 sq. ft. RENT $963 per month $
Slide 10: Manufactured Housing vs. Single Family
MANUFACTURED HOUSING VS. SINGLE FAMILY . Sun’s communities offer affordable options in attractive locations Manufactured Homes Single Family Homes Average cost of a new Manufactured Home is Average cost of Single Family is $293,727 or $71,900 or roughly 2 years median income roughly 7 years medi
Slide 11: Manufactured Housing and RV Manufacturing Businesses Increasing Shipments
MANUFACTURED HOUSING AND RV MANUFACTURING BUSINESSES INCREASING SHIPMENTS . The demand for affordable homeownership and vacationing is reflected in the increased output from manufactured housing and RV manufacturers . Strong compounded annual growth rates for shipments of manufactured homes and RVs
Slide 12: Expansions Provide Strong Growth and Attractive Returns
EXPANSIONS PROVIDE STRONG GROWTH AND ATTRACTIVE RETURNS . 67 sites were delivered at 3 communities during the first quarter of 2019 . Expect to deliver 1,200 – 1,400 expansion sites by the end of 2019 . ~6,600 expansion sites available for development post-2019 . A 100-site expansion at a $35,000-$4
Slide 13: Maximizing Value from Strategic Acquisitions
MAXIMIZING VALUE FROM STRATEGIC ACQUISITIONS Professional Operational Management Adding Value with Expansions Home Sales & Rental Program Call Center & Digital Marketing Outreach Skilled Expense Management Repositioning with Additional Capex Year-end Communities and Sites . Since 2011, Sun has acqui
Slide 14: Strategic Balance Sheet
STRATEGIC BALANCE SHEET . Balance sheet supports growth strategy . Sun’s annual mortgage maturities average 5.1% of total mortgage debt outstanding from 2019 - 2023 Mortgage Debt Outstanding Mortgage Debt 5-Year Maturity Ladder principal amounts in thousands amounts in thousands Quarter Ended March
Slide 15: Strategy-Driven Outperformance
STRATEGY-DRIVEN OUTPERFORMANCE . Sun has significantly outperformed major REIT and broader market indices over the last ten years YTD Total Return 3-year Total Return 30.0% 90.0% 81.1% 25.0% 80.0% 22.0% 70.0% 20.0% 19.1% 60.0% 15.0% 50.0% 13.5% 45.3% 40.0% 10.0% 30.0% 5.0% 20.0% 19.3% 10.0% 0.0% 0.0
Slide 16: Consistent NOI Growth
CONSISTENT NOI GROWTH . Manufactured housing is one of the most recession-resistant sectors of the housing and commercial real estate sectors and has consistently outperformed multifamily in same community NOI growth since 2000 NOI Growth $242 Sun Communities $240 $233 Manufactured Housing $233 Self
Slide 17: Appendix
APPENDIX HACIENDA DEL RIO – EDGEWATER, FL ACQUIRED JANUARY 2019
Slide 18: Non-GAAP Terms Defined
NON-GAAP TERMS DEFINED 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, NO
Slide 19: Net Income to FFO Reconciliation
NET INCOME TO FFO RECONCILIATION (amounts in thousands except per share data) Three Months Ended March 31, Year Ended December 31, 2019 2018 2018 2017 2016 Net income attributable to Sun Communities, Inc. common stockholders $ 34,331 $ 29,986 $ 105,493 $ 65,021 $ 17,369 Adjustments: Depreciation and
Slide 20: Net Income to NOI Reconciliation
NET INCOME TO NOI RECONCILIATION (amounts in thousands) Three Months Ended March 31, Year Ended December 31, 2019 2018 2018 2017 2016 Net income attributable to Sun Communities, Inc., common stockholders $ 34,331 $ 29,986 $ 105,493 $ 65,021 $ 17,369 Other revenues (8,480) (6,276) (27,057) (24,874) (
Slide 21: Net Income to Recurring EBITDA Reconciliation
NET INCOME TO RECURRING EBITDA RECONCILIATION (amounts in thousands) Three Months Ended March 31, Year Ended December 31, 2019 2018 2018 2017 2016 Net income attributable to Sun Communities, Inc., common stockholders $ 34,331 $ 29,986 $ 105,493 $ 65,021 $ 17,369 Adjustments: Interest expense 35,108