Slide 1: Sun Communities Investor Presentation (NYSE: SUI)
CHERRYWOOD – CLINTON, NY SUN COMMUNITIES INVESTOR PRESENTATION (NYSE: SUI) NOVEMBER 2022
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS 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 ind
Slide 3: Sun Communities – Company Highlights
SUN COMMUNITIES – COMPANY HIGHLIGHTS Highlights Pages VALLECITO – NEWBURY PARK, CA Strong Results in 2022 Demonstrated Recession-Resistant Platform 4 Leading Owner / Operator of Manufactured Housing (“MH”) & 5-6 Recreational Vehicle (“RV”) Communities, and Marinas Compelling Supply-Demand Fundamenta
Slide 4: YTD Performance Update
YTD PERFORMANCE UPDATE Resilient Platform and Operational Strength Drive Outperformance • Increased FY22 FFO(1) per Share Guidance for 2nd consecutive quarter; $7.35 at the midpoint represents ~13% growth over FY21 o MH / RV same property NOI growth assumptions of 5.8% - 6.2% for FY22 o Marina same
Slide 5: Leading Owner / Operator of MH, RV and Marinas
LEADING OWNER / OPERATOR OF MH, RV AND MARINAS With ~180,600 MH and RV sites and ~46,200 wet slips and dry storage spaces, Sun is the largest publicly traded operator of MH, RV and Marinas MH RV Marina Largest publicly traded portfolio of Best-in-class RV communities with Largest and most di
Slide 6: Leading Owner / Operator of MH, RV and Marinas
LEADING OWNER / OPERATOR OF MH, RV AND MARINAS Total portfolio MH and RV annual occupancy in North America is 97.1% UK-based MH Portfolio is 91.7% occupied Location MH & RV Sites Wet Slip & Dry Storage Spaces Current Portfolio As of September 30, 2022 Florida 46,494 5,139 United Kingdom Michigan
Slide 7: Compelling Supply-Demand Fundamentals – MH
COMPELLING SUPPLY-DEMAND FUNDAMENTALS – MH Manufactured Housing (MH) U.S. & Canada UK • Total MH portfolio at 96.2% occupancy, with ~70% of • Numerous barriers to entry including strict regulatory communities 98%+ environment, scarcity of desirable land and benefits of scale • ~43K applications YTD
Slide 8: Compelling Supply-Demand Fundamentals – RV and Marina
COMPELLING SUPPLY-DEMAND FUNDAMENTALS – RV AND MARINA RV Marinas • 11 million households own an RV versus ~1 million RV • Existing base of ~12 million registered boats within the campsites U.S. and an estimated supply of ~900K to 1 million leasable wet slips • 9.5 million people plan to buy an RV in
Slide 9: Sticky Customer Base with Limited CapEx
STICKY CUSTOMER BASE WITH LIMITED CAPEX Annual home move-outs in Sun’s MH communities are 0.5% ꟷ Uninterrupted rental income stream: average tenure of residents in our MH communities is ~14 years(1) before unit is sold in place ꟷ Low turnover driven by a $6k - $10k average cost for a resident to m
Slide 10: Track Record of Strong FFO Growth
TRACK RECORD OF STRONG FFO GROWTH Sun has generated greater FFO per share growth than peers and adjacent sectors 9.2% Core FFO per share growth (10-year CAGR) 5.5% Core FFO per share yield than peers and adjacent sectors Core / Normalized FFO Per Share Growth(1)(2)(3) Indexed to 100 from 2017
Slide 11: Multiple Levers Drive Resilient FFO and Cash Flow Growth
MULTIPLE LEVERS DRIVE RESILIENT FFO AND CASH FLOW GROWTH Outstanding record of revenue growth supported by internal and external opportunities Growth Levers Potential Annual Revenue Growth / Contribution - 4.7% weighted average rate increase as of September 2022 Contractual Rent Increases - Over 9
Slide 12: Steady Internal Growth and Strong External Growth
STEADY INTERNAL GROWTH AND STRONG EXTERNAL GROWTH RESERVE AT FOX CREEK – BULLHEAD CITY, AZ MH / RV Same Property NOI Growth Historical Average: 7.0% 11.2% 9.1% 7.7% 6.9% 6.7% 7.3% 7.1% 6.2% 5.5% 5.9% 4.0% 5.8% 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022E MH Weighted Average Rental Rate Gr
Slide 13: Consistent, Cycle-Tested Internal Growth
CONSISTENT, CYCLE-TESTED INTERNAL GROWTH Resilient demand, high barriers to entry, and Sun’s investment and operational platform have resulted in consistent, and cycle tested organic cash flow growth For more than 20 years, every individual year or rolling 4-quarter period, Sun has recorded posi
Slide 14: Conversion of RV Transient-to-Annual Leases Generates Significant Uplift
CONVERSION OF RV TRANSIENT-TO-ANNUAL LEASES GENERATES SIGNIFICANT UPLIFT IN REVENUE Transient RV site conversions to annual leases have historically increased revenue per site by 40-60% for the first full year after conversion and increases our annual RV sites ~2,000 transient to annual RV conve
Slide 15: Strategic Acquisitions Support Future Growth
STRATEGIC ACQUISITIONS SUPPORT FUTURE GROWTH Professional Operational Management Adding Value with Expansions Home Sales & Rental Program Consolidating Fragmented Markets Skilled Expense Management Repositioning with Additional CapEx Properties and Sites • Since 2010, Sun has acquired properties val
Slide 16: Industry-Leading Holiday Park Platform
INDUSTRY-LEADING HOLIDAY PARK PLATFORM Macro economic tailwinds in the UK bolster demand for domestic holidays Complementary to Sun Platform Well Located, Highly Amenitized Properties Strong Internal and External Growth Prospects ~12,300 owner-occupied sites under 20+ year Leading presence in
Slide 17: Premier Owner / Operator of Marinas
PREMIER OWNER / OPERATOR OF MARINAS Service Offerings Keep Members in Network 131 Average Marina member tenure (in years) Marinas in 24 States & ~37,600 ~8,600 9.3 Puerto Rico Wet Slips Dry Storage Spaces(1) 8.8 8.2 6.5 6.9 6.7 5.9 6.3 5.6 5.0 ~85% 80% 75% Marinas Marinas Located in Marinas Owned 20
Slide 18: Balance Sheet Supports Growth Strategy
BALANCE SHEET SUPPORTS GROWTH STRATEGY Current Debt Outstanding ($ in millions)(1) Credit Statistics Weighted Weighted Rate Type(5) As of September 30, 2022 Principal Average Interest Average Years to Outstanding(2) Rates Maturity Total Secured Debt $3,006 3.67% 10.9 16% variable rate Baa3 Unsecured
Slide 19: Sun Communities' ESG Initiatives
SUN COMMUNITIES’ ESG INITIATIVES Our board and executive leadership are committed to sustainable business practices that benefit all stakeholders including the broader communities in which we operate Current initiatives to advance our ESG platform include policy enhancement, establishing environ
Slide 20: Appendix
APPENDIX SUN OUTDOORS CAROLINA PINES RV RESORT – CONWAY, SC
Slide 21: Renting – MH vs. Other Rental Options
RENTING – MH VS. OTHER RENTAL OPTIONS Manufactured homes in Sun’s communities provide 25% more space at ~54% less cost per square foot Manufactured Homes in Other Rental Sun’s Communities Options(1) PRICE $0.95 per sq. ft. $2.08 per sq. ft. SQUARE FOOTAGE 1,250 sq. ft. 1,000 sq. ft. RENT $1,19
Slide 22: Industry-Leading Social Media Engagement and Original Digital Content
INDUSTRY-LEADING SOCIAL MEDIA ENGAGEMENT AND ORIGINAL DIGITAL CONTENT Sun leads the outdoor vacation industry across social media channels with ~2.1mm followers and 64mm total engagements Sun Outdoors original content and Sun Communities Virtual Home Tours allow prospective guests and residents
Slide 23: Strategy-Driven Outperformance
STRATEGY-DRIVEN OUTPERFORMANCE Sun has significantly outperformed major REIT and broader market indices over the last ten years 2022 YTD Total Return 3-year Total Return 75.0% 0.0% 50.0% (10.0%) 36.8% (17.7)% 25.0% (20.0%) (24.8)% 0.0% 3.2% (30.0%) (34.7)% (1.3)% (40.0%) (25.0%) (50.0%) (50.0%) 5-
Slide 24: 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 25: Net Income to FFO Reconciliation
NET INCOME TO FFO RECONCILIATION Three Months Ended September 30, Nine Months Ended September 30, Year Ended December 31, (amounts in millions except per share data) 2022 2021 2022 2021 2021 2020 2019 Net Income Attributable to SUI Common Shareholders $ 162.6 $ 231.7 $ 237.3 $ 367.3 $ 380.2 $ 131.6
Slide 26: Net Income to NOI Reconciliation
NET INCOME TO NOI RECONCILIATION Three Months Ended September 30, Nine Months Ended September 30, Year Ended December 31, (amounts in millions) 2022 2021 2022 2021 2021 2020 2019 Net Income Attributable to SUI Common Shareholders $ 162.6 $ 231.7 $ 237.3 $ 367.3 $ 380.2 $ 131.6 $ 160.3 Interest incom
Slide 27: Net Income to Recurring EBITDA Reconciliation
NET INCOME TO RECURRING EBITDA RECONCILIATION Three Months Ended September 30, Nine Months Ended September 30, Year Ended December 31, (amounts in millions) 2022 2021 2022 2021 2021 2020 2019 Net Income Attributable to SUI Common Shareholders $ 162.6 $ 231.7 $ 237.3 $ 367.3 $ 380.2 $ 131.6 $ 160.3 A