Sun Communities, Inc. · NYSE:SUI

Sun Communities — Investor Presentation (September 2016)

24 slides from Sun Communities's investor presentation, Sep 12, 2016

  1. Slide 1: Investor Presentation September 2016

    INVESTOR PRESENTATION SEPTEMBER 2016

  2. 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") and from third-party sources indicated herein. Such third-party information has not been independently verified. The Company makes no repr

  3. Slide 3: Key Highlights

     Leading owner of premier manufactured housing and recreational vehicle communities  Cycle-tested organic growth  Proven consolidator of accretive portfolios  Enhancing growth through owned community expansions  Conservative balance sheet  Strategy-driven outperformance KEY HIGHLIGHTS 3 Jellys

  4. Slide 4: Sun Communities, Inc.

    SUN COMMUNITIES, INC. (NYSE: SUI) 4  Leading owner of premier manufactured home and recreational vehicle communities 227 manufactured housing only communities 26 manufactured housing and recreational vehicle communities 85 recreational vehicle only communities 5,032 1,523 713 149 1,370 24,513 3,026

  5. Slide 5: High Quality Real Estate

    5 HIGH QUALITY REAL ESTATE  91% of the communities are on or located within a day trip1 of a major body of water SOURCE: COMPANY INFORMATION. 1 WITHIN 200 MILES. 2 AVERAGE IS BASED ON THE TOTAL FROM THE SELECTED U.S. NATIONAL PARKS. 56% 36% 8% Atlantic Ocean/Gulf of Mexico Great Lakes Pacific Ocean

  6. Slide 6: Consistent Organic Growth

    CONSISTENT ORGANIC GROWTH 6  Low annual resident turnover results in stability of income and occupancy  Strong and consistent rental growth creates a stable revenue stream  Occupancy gains are a function of Sun’s integrated platform, including leasing, sales, and financing SOURCE: COMPANY INFORMA

  7. Slide 7: Strong Internal Growth

    STRONG INTERNAL GROWTH 7 SOURCE: CITI INVESTMENT RESEARCH, JULY, 2016. “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.  SUN’s average same co

  8. Slide 8: Favorable Revenue Drivers

    FAVORABLE REVENUE DRIVERS 8 Sun’s Percentage trends for manufactured homes and annual/seasonal RV’s No loss in revenue as home stays in the community Resident re-sales Home move-out 4.9% 5.1% 4.7% 4.9% 4.6% 5.0% 5.9% 2.8% 2.3% 2.3% 2.5% 2.6% 2.6% 2.0% 2009 2010 2011 2012 2013 2014 2015 Stable and gr

  9. Slide 9: Strategic Acquisitions: Extracting Value

    STRATEGIC ACQUISITIONS PROFESSIONAL OPERATIONAL MANAGEMENT CALL CENTER / DIGITAL MARKETING OUTREACH INCREASING MARKET RENT HOME SALES / RENTAL PROGRAM ADDING VALUE WITH EXPANSIONS REPOSITIONING WITH ADDITIONAL CAPEX SKILLED EXPENSE MANAGEMENT EXTRACTING VALUE FROM ACQUISITIONS 9

  10. Slide 10: Strategic Acquisitions

    STRATEGIC ACQUISITIONS 10 2011 2012 2013 2014 2015 2016 136 communities 54,811 sites 173 communities 63,697 sites 188 communities 69,789 sites 217 communities 79,554 sites 231 communities 88,612 sites • Further strengthened the MH portfolio with the 6 community Rudgate acquisition. • Acquired Palm C

  11. Slide 11: Acquisition Performance

    $28.9M $32.7M $35.6M YEAR 1 YEAR 2 YEAR 3 Revenue NOI 11 Acquisition Performance 2011 Acquisitions (26 COMMUNITIES) 2012 Acquisitions (11 COMMUNITIES) SOURCE: COMPANY INFORMATION. AS OF THE YEAR ENDED DECEMBER 31, 2015. New Point RV Resort New Point, Virginia Palm Creek Golf & RV Resort Casa Grande,

  12. Slide 12: Acquisition Performance RV Portfolio

    $11.0M $13.3M $14.6M YEAR 1 YEAR 2 YEAR 3 Revenue NOI 2013 Morgan Acquisition (10 PROPERTIES) SOURCE: COMPANY INFORMATION. AS OF THE YEAR ENDED DECEMBER 31, 2015. 1 INCLUDES PARTIAL YEAR 2016 BUDGET. ACQUISITION PERFORMANCE RV PORTFOLIO 12 1

  13. Slide 13: Carefree: Key Market Penetration

    ONTARIO, CANADA CAREFREE: KEY MARKET PENETRATION 13 4,888 189 757 15,909 5,032 92 398 307 With the Carefree acquisition, Sun has deepened its presence in key, high-barrier markets CAREFREE PROPERTY ADDITIONS1 SUN COMMUNITIES PROPERTIES 1 SOURCE: COMPANY INFORMATION. REFER TO SUN COMMUNITIES, INC. FO

  14. Slide 14: Expansions: Strong Growth and Attractive Returns

    EXPANSIONS:  Inventory of approximately 10,000 zoned and entitled sites available for expansion at 64 communities within 20 states and Ontario  Approximately 800 sites are expected to be developed by the end of 2016  A 100 site expansion at a $25,000 cost per site, that is leased up in a year (8

  15. Slide 15: Expansion Opportunities Supported by Rental Program

    EXPANSION OPPORTUNITIES SUPPORTED BY RENTAL PROGRAM 15 12.6% 13.5% 13.6% 14.0% 15.7% 15.6% 13.5% 70.8% 70.9% 71.7% 73.3% 74.0% 77.1% 81.6% 2009 2010 2011 2012 2013 2014 2015 Rental Occupancy Core Portfolio Occupancy 83.4% 84.3% 85.3% 87.3% 89.7% 92.6% 95.0% SOURCE: SUN’S DECEMBER 31, 2015 SUPPLEMENT

  16. Slide 16: Conservative Balance Sheet

    CONSERVATIVE BALANCE SHEET 16  Balance sheet supports growth strategy  Strong interest coverage  Reduced leverage through recent ATM and September equity offerings  Anticipates further delevering over time through EBITDA contribution and earnings growth SOURCE: COMPANY INFORMATION. REFER TO SUN

  17. Slide 17: Mortgage Debt Maturity Profile

    MORTGAGE DEBT MATURITY PROFILE 17 SOURCE: COMPANY INFORMATION. REFER TO SUN COMMUNITIES, INC. FORM 10-Q AND SUPPLEMENTAL FOR THE QUARTER ENDED JUNE 30, 2016 FOR ADDITIONAL INFORMATION. IN THOUSANDS, AS OF JUNE 30, 2016. Sun’s annual mortgage maturities average 4% over the next 5 years WEIGHTED AVERA

  18. Slide 18: Strategy Driven Outperformance

    STRATEGY DRIVEN OUTPERFORMANCE 18 Sun’s – 5 Year’s Total Return Percentage1 1 SOURCE: SNL. TOTAL RETURN CALCULATION ASSUMES DIVIDEND REINVESTMENT 2 SOURCE: SNL. SNL U.S. REIT EQUITY : INCLUDES ALL PUBLICLY TRADED (NYSE, NYSE MKT, NASDAQ, OTC) EQUITY REITS IN SNL'S COVERAGE UNIVERSE. -50 0 50 100 150

  19. Slide 19: Key Highlights

     Leading owner of premier manufactured housing and recreational vehicle communities  Cycle-tested organic growth  Proven consolidator of accretive portfolios  Enhancing growth through owned community expansions  Conservative balance sheet  Strategy-driven outperformance KEY HIGHLIGHTS 19

  20. Slide 20: Appendix

    APPENDIX

  21. Slide 21: Recent Highlights: Q2 2016

    RECENT HIGHLIGHTS: Q2 2016 SOURCE: COMPANY INFORMATION. REFER TO SUN COMMUNITIES, INC. FORM 10-Q AND SUPPLEMENTAL FOR THE QUARTER ENDED JUNE 30, 2016 FOR ADDITIONAL INFORMATION. 1 EXCLUDING CERTAIN ITEMS.  Funds From Operations was $0.851 per diluted share and OP unit for the three months ended Jun

  22. Slide 22: Consistent NOI Growth

    CONSISTENT NOI GROWTH Appendix 2  Manufactured housing is one of the most recession resistant sectors of the housing and commercial real estate sectors and has consistently outperformed multi-family in same site NOI growth since 20001 1 SOURCE: SNL.COM. AS OF JUNE 30, 2016. ASSUMES $100.00 NOI STAR

  23. Slide 23: Manufactured Housing vs. Multi-Family

    Manufactured Housing vs. Multi-Family Sun’s Manufactured Homes VS.  Sun’s manufactured homes provide nearly 15% more space at over 30% less cost per square foot RENT    ~$8601 per month Multi-Family Housing ~$1,1002 per month SQUARE FOOTAGE PRICE ~1,250 sq. ft. ~1,1002 sq. ft. $0.69 per sq. ft.

  24. Slide 24: Manufactured Housing vs. Single Family

    Manufactured Housing vs. Single Family 1 SOURCE: MANUFACTURED HOUSING INSTITUTE, QUICK FACTS: “TRENDS AND INFORMATION ABOUT THE MANUFACTURED HOUSING INDUSTRY, 2016.” REPRESENTS AVERAGE 2 BEDROOM HOUSEHOLD IN MAJOR METROPOLITAN AREAS SUN OPERATES IN AS OF JUNE 2016. 2 SOURCE: US CENSUS BUREAU - 2010-

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