Slide 1: Investor Presentation NAREIT June 2016
INVESTOR PRESENTATION N A R E I T June 2016
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
Slide 3: Key Highlights
Key Highlights Leading owner of premier manufactured housing and recreational vehicle communities Consistent organic growth through market cycles Sustained industry-leading earnings growth, with low capital requirements Proven consolidator of accretive portfolios Enhancing growth through e
Slide 4: Leading owner of premier manufactured home and recreational vehicle communities
Sun Communities, Inc. (NYSE: SUI) 4 186 manufactured housing only communities 10 manufactured housing and recreational vehicle communities 37 recreational vehicle only communities 1,521 406 149 1,370 24,513 2,630 1,277 916 1,187 2,913 3,401 549 1,652 685 237 581 419 1,150 404 413 976 226 2,335 473 6
Slide 5: Recent Results: Q1 2016
Recent Results :Q1 2016 5 Funds From Operations was $0.901 per diluted share and OP unit for the three months ended March 31, 2016 Home sales increased by 40.9% as compared to the first quarter of 2015 Revenue producing sites increased by 592 sites for the quarter bringing total portfolio occu
Slide 6: Consistent Organic Growth
6 Consistent Organic Growth 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 SOURCE: COMPANY INFORM
Slide 7: Strong Internal Growth
Strong Internal Growth 7 SUN’s average same community NOI growth has exceeded REIT industry average by 180 bps and apartment average by 160 bps over a 17 year period SOURCE: CITI INVESTMENT RESEARCH, APRIL, 2016. “REITS”- INCLUDES AN INDEX OF REITS ACROSS A VARIETY OF ASSET CLASSES INCLUDING SELF
Slide 8: Stable Revenue with Low Capex
8 Stable Revenue with Low Capex Move-outs and Re-sales Stable and growing financial results driven by low turnover and tenure: The cost to move a home ranges between $4,000 and $10,000. This facilitates a low turnover of owner occupied sites Tenure of our residents in our communities is ~14 year
Slide 9: Extracting Value from Acquisitions
Extracting Value from Acquisitions 9 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
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
Slide 11: Acquisition Performance
Acquisition Performance 11 83.4% 90.8% 92.5% 97.6% 98.5% YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 Occupancy $23.6M $26.0M $27.5M $29.3M $31.3M YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 Revenue NOI 2011 Acquisitions (26 COMMUNITIES) 2012 Acquisitions (11 COMMUNITIES) 91.4% 96.8% 97.1% 98.1% YEAR 1 YEAR 2 YEAR 3 Y
Slide 12: Acquisition Performance: RV Portfolio
Acquisition Performance RV Portfolio 12 $4.8M $5.9M $7.0M $8.5M YEAR 1 YEAR 2 YEAR 3 YEAR 4 Revenue NOI 2013 Morgan Acquisition (10 PROPERTIES) SOURCE: COMPANY INFORMATION. AS OF THE YEAR ENDED DECEMBER 31, 2015. 1 INCLUDES PARTIAL YEAR 2016 BUDGET. 1
Slide 13: Carefree Augments Sun's Best-in-Class Portfolio
Sun-N-Fun Sarasota, Florida Palos Verdes Shores San Pedro, California Sunset Harbor Key West, Florida Carefree Augments Sun’s Best-in-Class Portfolio High quality portfolio concentrated in prime coastal markets Increases size, scale and diversification Strong operating metrics and attractive g
Slide 14: Carefree's High Quality Portfolio
Carefree’s High Quality Portfolio 14 Age-Restricted Properties 52 communities 14,041 sites All-Age Properties 51 communities 13,513 sites Aggregate Portfolio 103 communities 27,554 sites Avg. Monthly Rent per MH Site $ 622 MH Occupancy 93.9% Number of States 8 Summary Statistics All -Age Age-Restric
Slide 15: Carefree Impact: Enhanced Scale, Geographic Footprint and Operating Metrics
Carefree Impact: Enhanced Scale, Geographic Footprint and Operating Metrics 15 Total Enterprise Value $7.045bn $1.699bn $8.744bn +24% Number of Communities 233 103 336 +44% Number of Sites 89,344 27,554 116,898 +31% Occupancy 96%3 97%3 97% Number of Expansion Sites 7,181 2,982 10,163 +42% Average Mo
Slide 16: Carefree Impact: Increased Key Market Penetration
16 Carefree Impact: Increased Key Market Penetration 4,885 189 757 15,901 5,054 92 398 278 SUI will strengthen its presence in key, high-barrier markets with this acquisition CAREFREE PROPERTY ADDITIONS SUN COMMUNITIES PROPERTIES ONTARIO, CANADA FL 26,976 15,901 42,877 36.7% TX 6,769 757 7,526 6.4%
Slide 17: Expansions
Expansions: 17 SOURCE: COMPANY INFORMATION. REFER TO SUN COMMUNITIES, INC. FORM 10-K AND SUPPLEMENTAL FOR THE YEAR ENDED DECEMBER 31, 2015 FOR ADDITIONAL INFORMATION. 1 BASED ON MOST RECENT ESTIMATION OF DEVELOPMENT COSTS AND EXPENSES AND ASSUMING A 6% CAP RATE EXITING IN FIVE YEARS. Inventory of
Slide 18: Expansion Opportunities Supported by Rental Program
Expansion Opportunities Supported by Rental Program 18 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
Slide 19: Net Debt / Total Enterprise Value
19 Net Debt / Total Enterprise Value2 Strong balance sheet management supported by consistently strong operations has led SUN to improving metrics Net Debt / Adjusted EBITDA1 Fixed Debt Percentage SOURCE: COMPANY INFORMATION. REFER TO SUN COMMUNITIES, INC. FORM 10-K AND SUPPLEMENTAL FOR THE RESPEC
Slide 20: Debt Maturity Profile
$ Debt Maturity Profile 20 SOURCE: COMPANY INFORMATION. REFER TO SUN COMMUNITIES, INC. FORM 10-Q AND SUPPLEMENTAL FOR THE QUARTER ENDED MARCH 31, 2016 FOR ADDITIONAL INFORMATION. 1 AMOUNTS EXCLUDING SECURED BORROWINGS, IN THOUSANDS, AS OF MARCH 31, 2016.ALSO DOES NOT INCLUDE ANY DEBT ATTRIBUTABLE TO
Slide 21: Strategy Driven Outperformance
Strategy Driven Outperformance 21 275% 262% 181% 177% 175% 172% 155% 0% 50% 100% 150% 200% 250% 300% SUI SNL US REIT Manufactured Homes S&P 500 SNL US REIT Equity MSCI US REIT (RMS) S&P Small-Cap Russell 2000 5-year Total Returns by Index1 Sun has outperformed many major REIT and broader market in
Slide 22: Key Highlights
Key Highlights Leading owner of premier manufactured housing and recreational vehicle communities Consistent organic growth through market cycles Sustained industry-leading earnings growth, with low capital requirements Proven consolidator of accretive portfolios Enhancing growth through e
Slide 23: Appendix
Appendix
Slide 24: Consistent NOI Growth
Consistent NOI Growth Appendix 1 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 DECEMBER 31, 2015. ASSUMES $100.00 NOI
Slide 25: 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.
Slide 26: 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, 2015.” REPRESENTS AVERAGE 2 BEDROOM HOUSEHOLD IN MAJOR METROPOLITAN AREAS SUN OPERATES IN AS OF FEBRUARY 2016. 2 SOURCE: US DEPARTMENT OF CEN