Maryland
|
38-2730780
|
|
(State of Incorporation)
|
(I.R.S. Employer Identification No.)
|
|
27777 Franklin Rd.
|
||
Suite 200
|
||
Southfield, Michigan
|
48034
|
|
(Address of Principal Executive Offices)
|
(Zip Code)
|
(248) 208-2500
|
Large accelerated filer [ ]
|
Accelerated filer [ X ]
|
Non-accelerated filer [ ]
|
Smaller reporting company [ ]
|
Pages
|
||
PART I – FINANCIAL INFORMATION
|
||
Item 1.
|
Financial Statements (Unaudited):
|
|
Consolidated Balance Sheets ─ June 30, 2010 and December 31, 2009
|
3
|
|
Consolidated Statements of Operations ─ Periods Ended June 30, 2010 and 2009
|
4
|
|
Consolidated Statements of Comprehensive Loss ─ Periods Ended June 30, 2010 and 2009
|
5
|
|
Consolidated Statement of Stockholders’ Deficit ─ Six Months Ended June 30, 2010
|
5
|
|
Consolidated Statements of Cash Flows ─ Six Months Ended June 30, 2010 and 2009
|
6
|
|
Notes to Consolidated Financial Statements
|
7
|
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
22
|
Item 3.
|
Quantitative and Qualitative Disclosures about Market Risk
|
37
|
Item 4.
|
Controls and Procedures
|
38
|
PART II – OTHER INFORMATION
|
||
Item 1.
|
Legal Proceedings
|
39
|
Item 1A.
|
Risk Factors
|
39
|
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
39
|
Item 6.
|
Exhibits
|
40
|
Signatures
|
41
|
(Unaudited)
|
||||||||
June 30, 2010
|
December 31, 2009
|
|||||||
ASSETS
|
||||||||
Investment property, net
|
$
|
1,043,627
|
$
|
1,064,305
|
||||
Cash and cash equivalents
|
5,618
|
4,496
|
||||||
Inventory of manufactured homes
|
2,457
|
3,934
|
||||||
Investment in affiliates
|
69
|
1,646
|
||||||
Notes and other receivables
|
82,713
|
74,030
|
||||||
Other assets
|
32,940
|
32,954
|
||||||
TOTAL ASSETS
|
$
|
1,167,424
|
$
|
1,181,365
|
||||
LIABILITIES
|
||||||||
Debt
|
$
|
1,165,736
|
$
|
1,159,442
|
||||
Lines of credit
|
85,581
|
94,465
|
||||||
Other liabilities
|
39,081
|
38,766
|
||||||
TOTAL LIABILITIES
|
1,290,398
|
1,292,673
|
||||||
Commitments and contingencies
|
||||||||
STOCKHOLDERS’ DEFICIT
|
||||||||
Preferred stock, $0.01 par value, 10,000 shares authorized, none issued
|
$
|
-
|
$
|
-
|
||||
Common stock, $0.01 par value, 90,000 shares authorized (June 30, 2010 and December 31, 2009, 21,154 and 20,635 shares issued respectively)
|
212
|
206
|
||||||
Additional paid-in capital
|
478,810
|
463,811
|
||||||
Officer's notes
|
(3,065
|
)
|
(5,028
|
)
|
||||
Accumulated other comprehensive loss
|
(2,538
|
)
|
(1,858
|
)
|
||||
Distributions in excess of accumulated earnings
|
(523,292
|
)
|
(498,370
|
)
|
||||
Treasury stock, at cost (June 30, 2010 and December 31, 2009, 1,802 shares)
|
(63,600
|
)
|
(63,600
|
)
|
||||
Total Sun Communities, Inc. stockholders' deficit
|
(113,473
|
)
|
(104,839
|
)
|
||||
Noncontrolling interests
|
(9,501
|
)
|
(6,469
|
)
|
||||
TOTAL STOCKHOLDERS’ DEFICIT
|
(122,974
|
)
|
(111,308
|
)
|
||||
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT
|
$
|
1,167,424
|
$
|
1,181,365
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
REVENUES
|
||||||||||||||||
Income from real property
|
$
|
49,948
|
$
|
48,497
|
$
|
101,955
|
$
|
99,496
|
||||||||
Revenue from home sales
|
9,598
|
8,218
|
17,635
|
15,679
|
||||||||||||
Rental home revenue
|
5,052
|
5,187
|
10,131
|
10,387
|
||||||||||||
Ancillary revenues, net
|
108
|
62
|
334
|
257
|
||||||||||||
Interest
|
1,973
|
1,368
|
3,769
|
2,640
|
||||||||||||
Other income (loss), net
|
(366
|
)
|
(60
|
)
|
(94
|
)
|
97
|
|||||||||
Total revenues
|
66,313
|
63,272
|
133,730
|
128,556
|
||||||||||||
COSTS AND EXPENSES
|
||||||||||||||||
Property operating and maintenance
|
13,105
|
12,787
|
26,145
|
25,392
|
||||||||||||
Real estate taxes
|
4,183
|
4,118
|
8,363
|
8,302
|
||||||||||||
Cost of home sales
|
7,233
|
5,844
|
13,477
|
11,267
|
||||||||||||
Rental home operating and maintenance
|
3,594
|
4,022
|
7,217
|
8,559
|
||||||||||||
General and administrative - real property
|
5,627
|
4,900
|
9,117
|
9,066
|
||||||||||||
General and administrative - home sales and rentals
|
1,853
|
1,816
|
3,786
|
3,642
|
||||||||||||
Depreciation and amortization
|
16,404
|
15,915
|
32,977
|
32,119
|
||||||||||||
Interest
|
15,455
|
14,739
|
30,560
|
28,984
|
||||||||||||
Interest on mandatorily redeemable debt
|
819
|
835
|
1,636
|
1,670
|
||||||||||||
Total expenses
|
68,273
|
64,976
|
133,278
|
129,001
|
||||||||||||
Income (loss) before income taxes and equity loss from affiliates
|
(1,960
|
)
|
(1,704
|
)
|
452
|
(445
|
)
|
|||||||||
Provision for state income taxes
|
(129
|
)
|
(146
|
)
|
(261
|
)
|
(279
|
)
|
||||||||
Equity loss from affiliates
|
(758
|
)
|
(517
|
)
|
(1,577
|
)
|
(490
|
)
|
||||||||
Loss from continuing operations
|
(2,847
|
)
|
(2,367
|
)
|
(1,386
|
)
|
(1,214
|
)
|
||||||||
Loss from discontinued operations
|
-
|
(160
|
)
|
-
|
(332
|
)
|
||||||||||
Net loss
|
(2,847
|
)
|
(2,527
|
)
|
(1,386
|
)
|
(1,546
|
)
|
||||||||
Less: amounts attributable to noncontrolling interests
|
(398
|
)
|
(268
|
)
|
(274
|
)
|
(164
|
)
|
||||||||
Net loss attributable to Sun Communities, Inc. common stockholders
|
$
|
(2,449
|
)
|
$
|
(2,259
|
)
|
$
|
(1,112
|
)
|
$
|
(1,382
|
)
|
||||
Amounts attributable to Sun Communities, Inc. common stockholders:
|
||||||||||||||||
Loss from continuing operations, net of state income taxes
|
$
|
(2,449
|
)
|
$
|
(2,116
|
)
|
$
|
(1,112
|
)
|
$
|
(1,085
|
)
|
||||
Loss from discontinued operations, net of state income taxes
|
-
|
(143
|
)
|
-
|
(297
|
)
|
||||||||||
Net loss attributable to Sun Communities, Inc. common stockholders
|
$
|
(2,449
|
)
|
$
|
(2,259
|
)
|
$
|
(1,112
|
)
|
$
|
(1,382
|
)
|
||||
Weighted average common shares outstanding:
|
||||||||||||||||
Basic
|
19,031
|
18,469
|
18,848
|
18,399
|
||||||||||||
Diluted
|
19,031
|
18,469
|
18,848
|
18,399
|
||||||||||||
Basic and diluted loss per share:
|
||||||||||||||||
Continuing operations
|
$
|
(0.13
|
)
|
$
|
(0.11
|
)
|
$
|
(0.06
|
)
|
$
|
(0.05
|
)
|
||||
Discontinued operations
|
-
|
(0.01
|
)
|
-
|
(0.02
|
)
|
||||||||||
Basic and diluted loss per share
|
$
|
(0.13
|
)
|
$
|
(0.12
|
)
|
$
|
(0.06
|
)
|
$
|
(0.07
|
)
|
||||
Cash dividends per common share:
|
$
|
0.63
|
$
|
0.63
|
$
|
1.26
|
$
|
1.26
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Net loss
|
$
|
(2,847
|
)
|
$
|
(2,527
|
)
|
$
|
(1,386
|
)
|
$
|
(1,546
|
)
|
||||
Unrealized gain (loss) on interest rate swaps
|
(325
|
)
|
1,330
|
(757
|
)
|
1,326
|
||||||||||
Total comprehensive loss
|
(3,172
|
)
|
(1,197
|
)
|
(2,143
|
)
|
(220
|
)
|
||||||||
Less: amounts attributable to noncontrolling interests
|
(431
|
)
|
(127
|
)
|
(351
|
)
|
(23
|
)
|
||||||||
Comprehensive loss attributable to Sun Communities, Inc. common stockholders
|
$
|
(2,741
|
)
|
$
|
(1,070
|
)
|
$
|
(1,792
|
)
|
$
|
(197
|
)
|
Common Stock
|
Additional Paid-in Capital
|
Officer's Notes
|
Accumulated Other Comprehensive Loss
|
Distributions in Excess of Accumulated Earnings
|
Treasury Stock
|
Total Sun Communities Stockholders' Deficit
|
Non-
controlling Interest
|
Total Stockholders' Deficit
|
||||||||||||||||||||||||||||
Balance as of December 31, 2009
|
$
|
206
|
$
|
463,811
|
$
|
(5,028
|
)
|
$
|
(1,858
|
)
|
$
|
(498,370
|
)
|
$
|
(63,600
|
)
|
$
|
(104,839
|
)
|
$
|
(6,469
|
)
|
$
|
(111,308
|
)
|
|||||||||||
Issuance of common stock, net
|
6
|
13,789
|
-
|
-
|
-
|
-
|
13,795
|
-
|
13,795
|
|||||||||||||||||||||||||||
Stock-based compensation - amortization and forfeitures
|
-
|
1,210
|
-
|
-
|
28
|
-
|
1,238
|
-
|
1,238
|
|||||||||||||||||||||||||||
Net loss
|
-
|
-
|
-
|
-
|
(1,112
|
)
|
-
|
(1,112
|
)
|
(274
|
)
|
(1,386
|
)
|
|||||||||||||||||||||||
Unrealized loss on interest rate swaps and cap
|
-
|
-
|
-
|
(680
|
)
|
-
|
-
|
(680
|
)
|
(77
|
)
|
(757
|
)
|
|||||||||||||||||||||||
Repayment of officer's notes
|
-
|
-
|
1,963
|
-
|
-
|
-
|
1,963
|
-
|
1,963
|
|||||||||||||||||||||||||||
Cash distributions declared of $1.26 per share
|
-
|
-
|
-
|
-
|
(23,838
|
)
|
-
|
(23,838
|
)
|
(2,681
|
)
|
(26,519
|
)
|
|||||||||||||||||||||||
Balance as of June 30, 2010
|
$
|
212
|
$
|
478,810
|
$
|
(3,065
|
)
|
$
|
(2,538
|
)
|
$
|
(523,292
|
)
|
$
|
(63,600
|
)
|
$
|
(113,473
|
)
|
$
|
(9,501
|
)
|
$
|
(122,974
|
)
|
Six Months Ended June 30,
|
||||||||
2010
|
2009
|
|||||||
OPERATING ACTIVITIES:
|
||||||||
Net loss
|
$
|
(1,386
|
)
|
$
|
(1,546
|
)
|
||
Less: Loss from discontinued operations, net of tax
|
-
|
(332
|
)
|
|||||
Loss from continuing operations
|
(1,386
|
)
|
(1,214
|
)
|
||||
Adjustments to reconcile loss from continuing operations to net cash provided by operating activities:
|
||||||||
Gain on disposal of other assets and depreciated homes, net
|
(1,654
|
)
|
(2,691
|
)
|
||||
Loss (gain) on valuation of derivative instruments
|
13
|
(12
|
)
|
|||||
Stock compensation expense
|
1,301
|
1,986
|
||||||
Depreciation and amortization
|
34,187
|
34,319
|
||||||
Amortization of deferred financing costs
|
849
|
796
|
||||||
Equity loss from affiliates, net
|
1,577
|
490
|
||||||
Change in notes receivable from financed sales of inventory homes, net of repayments
|
(2,599
|
)
|
(1,955
|
)
|
||||
Change in inventory, other assets and other receivables, net
|
(418
|
)
|
(248
|
)
|
||||
Change in accounts payable and other liabilities
|
(418
|
)
|
2,904
|
|||||
Net cash provided by operating activities of continuing operations
|
31,452
|
34,375
|
||||||
Net cash used for operating activities of discontinued operations
|
-
|
(273
|
)
|
|||||
NET CASH PROVIDED BY OPERATING ACTIVITIES
|
31,452
|
34,102
|
||||||
INVESTING ACTIVITIES:
|
||||||||
Investment in properties
|
(20,652
|
)
|
(19,058
|
)
|
||||
Proceeds related to disposition of other assets and depreciated homes, net
|
195
|
176
|
||||||
Reduction of notes receivable and officer's notes, net
|
2,631
|
3,499
|
||||||
NET CASH USED FOR INVESTING ACTIVITIES
|
(17,826
|
)
|
(15,383
|
)
|
||||
FINANCING ACTIVITIES:
|
||||||||
Issuance and associated costs of common stock and OP units, net
|
13,795
|
(377
|
)
|
|||||
Borrowings on lines of credit
|
70,759
|
80,456
|
||||||
Payments on lines of credit
|
(79,643
|
)
|
(86,553
|
)
|
||||
Payments to retire preferred operating partnership units
|
(925
|
)
|
-
|
|||||
Proceeds from issuance of other debt
|
17,104
|
31,111
|
||||||
Payments on other debt
|
(6,907
|
)
|
(18,267
|
)
|
||||
Payments for deferred financing costs
|
(168
|
)
|
(477
|
)
|
||||
Distributions to stockholders and OP unit holders
|
(26,519
|
)
|
(26,149
|
)
|
||||
NET CASH USED FOR FINANCING ACTIVITIES
|
(12,504
|
)
|
(20,256
|
)
|
||||
Net increase (decrease) in cash and cash equivalents
|
1,122
|
(1,537
|
)
|
|||||
Cash and cash equivalents, beginning of period
|
4,496
|
6,162
|
||||||
Cash and cash equivalents, end of period
|
$
|
5,618
|
$
|
4,625
|
||||
SUPPLEMENTAL INFORMATION:
|
||||||||
Cash paid for interest
|
$
|
26,534
|
$
|
25,970
|
||||
Cash paid for interest on mandatorily redeemable debt
|
$
|
1,636
|
$
|
1,670
|
||||
Cash paid for state income taxes
|
$
|
401
|
$
|
342
|
||||
Noncash investing and financing activities:
|
||||||||
Unrealized gain (loss) on interest rate swaps
|
$
|
(757
|
)
|
$
|
1,326
|
|||
Reduction in secured borrowing balance
|
$
|
2,978
|
$
|
1,798
|
||||
1.
|
Basis of Presentation
|
2.
|
Discontinued Operations
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
June 30,
|
June 30,
|
|||||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Total revenues
|
$
|
-
|
$
|
172
|
$
|
-
|
$
|
355
|
||||||||
Total expenses
|
-
|
(332
|
)
|
-
|
(687
|
)
|
||||||||||
Loss from discontinued operations
|
-
|
(160
|
)
|
-
|
(332
|
)
|
||||||||||
Less: amounts attributable to noncontrolling interest
|
-
|
(17
|
)
|
-
|
(35
|
)
|
||||||||||
Loss from discontinued operations attributable to Sun Communities, Inc. common stockholders
|
$
|
-
|
$
|
(143
|
)
|
$
|
-
|
$
|
(297
|
)
|
3.
|
Investment Property
|
June 30, 2010
|
December 31, 2009
|
|||||||
Land
|
$
|
116,266
|
$
|
116,266
|
||||
Land improvements and buildings
|
1,186,677
|
1,183,613
|
||||||
Rental homes and improvements
|
203,159
|
203,435
|
||||||
Furniture, fixtures, and equipment
|
35,883
|
35,400
|
||||||
Land held for future development
|
26,986
|
26,986
|
||||||
Investment property
|
1,568,971
|
1,565,700
|
||||||
Less: Accumulated depreciation
|
(525,344
|
)
|
(501,395
|
)
|
||||
Investment property, net
|
$
|
1,043,627
|
$
|
1,064,305
|
4.
|
Transfers of Financial Assets
|
Number of Payments
|
Recourse %
|
|||
Less than or equal to 15
|
100
|
%
|
||
Greater than 15 but less than 64
|
90
|
%
|
||
64 or more
|
65
|
%
|
4.
|
Transfers of Financial Assets, continued
|
Beginning balance as of December 31, 2009
|
$
|
52,368
|
||
Financed sales of manufactured homes
|
17,104
|
|||
Principal payments and payoffs from our customers
|
(1,665
|
)
|
||
Repurchases
|
(1,313
|
)
|
||
Total activity
|
14,126
|
|||
Ending balance as of June 30, 2010
|
$
|
66,494
|
5.
|
Notes and Other Receivables
|
June 30, 2010
|
December 31, 2009
|
|||||||
Installment notes receivable on manufactured homes, net
|
$
|
8,633
|
$
|
12,627
|
||||
Collateralized receivables, net (see Note 4)
|
66,296
|
52,201
|
||||||
Other receivables, net
|
7,784
|
9,202
|
||||||
Total notes and other receivables, net
|
$
|
82,713
|
$
|
74,030
|
5.
|
Notes and Other Receivables, continued
|
June 30, 2010
|
December 31, 2009
|
|||||||||||||||||||||||
Secured by
|
Secured by
|
|||||||||||||||||||||||
Promissory Notes
|
Outstanding Principal Balance
|
Common Stock
|
Common OP Units
|
Outstanding Principal Balance
|
Common Stock
|
Common OP Units
|
||||||||||||||||||
Secured - $1.3 million
|
$
|
354
|
21,797
|
-
|
$
|
581
|
35,756
|
-
|
||||||||||||||||
Secured - $6.6 million
|
1,799
|
48,399
|
34,819
|
2,952
|
79,395
|
57,118
|
||||||||||||||||||
Secured - $1.0 million
|
279
|
25,767
|
-
|
457
|
42,268
|
-
|
||||||||||||||||||
Subtotal secured notes
|
2,432
|
95,963
|
34,819
|
3,990
|
157,419
|
57,118
|
||||||||||||||||||
Unsecured - $1.0 million
|
279
|
-
|
-
|
457
|
-
|
-
|
||||||||||||||||||
Unsecured - $1.3 million
|
354
|
-
|
-
|
581
|
-
|
-
|
||||||||||||||||||
Subtotal unsecured notes
|
633
|
-
|
-
|
1,038
|
-
|
-
|
||||||||||||||||||
Total promissory notes
|
$
|
3,065
|
95,963
|
34,819
|
$
|
5,028
|
157,419
|
57,118
|
6.
|
Investment in Affiliates
|
6.
|
Investment in Affiliates, continued
|
|
|
|||||||||||||||
Three Months Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Revenues
|
$
|
18,880
|
$
|
21,042
|
$
|
38,495
|
$
|
42,747
|
||||||||
Expenses
|
23,070
|
23,499
|
46,932
|
44,691
|
||||||||||||
Net loss
|
$
|
(4,190
|
)
|
$
|
(2,457
|
)
|
$
|
(8,437
|
)
|
$
|
(1,944
|
)
|
7.
|
Debt and Lines of Credit
|
Principal Outstanding
|
Weighted Average Years to Maturity
|
Weighted Average Interest Rates
|
||||||||||||||||||||||
June 30, 2010
|
December 31, 2009
|
June 30, 2010
|
December 31, 2009
|
June 30, 2010
|
December 31, 2009
|
|||||||||||||||||||
Collateralized term loans - CMBS
|
$
|
467,311
|
$
|
471,299
|
4.1
|
4.6
|
5.1
|
%
|
5.1
|
%
|
||||||||||||||
Collateralized term loans - FNMA
|
371,340
|
373,501
|
3.9
|
4.4
|
4.1
|
%
|
4.1
|
%
|
||||||||||||||||
Preferred OP Units
|
48,022
|
48,947
|
10.8
|
3.7
|
6.8
|
%
|
6.8
|
%
|
||||||||||||||||
Secured borrowing (see Note 4)
|
66,494
|
52,368
|
13.7
|
13.8
|
11.2
|
%
|
10.9
|
%
|
||||||||||||||||
Mortgage notes, other
|
212,569
|
213,327
|
5.1
|
5.6
|
5.2
|
%
|
5.2
|
%
|
||||||||||||||||
Total debt
|
$
|
1,165,736
|
$
|
1,159,442
|
5.0
|
5.1
|
5.2
|
%
|
5.1
|
%
|
7.
|
Debt and Lines of Credit, continued
|
7.
|
Debt and Lines of Credit, continued
|
Maturities and Amortization By Year
|
||||||||||||||||||||||||||||
Total Due
|
2010
|
2011
|
2012
|
2013
|
2014
|
After 5 years
|
||||||||||||||||||||||
Lines of credit
|
$
|
85,581
|
$
|
-
|
$
|
76,581
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
9,000
|
||||||||||||||
Mortgage loans payable:
|
||||||||||||||||||||||||||||
Maturities
|
988,047
|
-
|
103,707
|
31,577
|
26,839
|
480,894
|
345,030
|
|||||||||||||||||||||
Principal amortization
|
63,173
|
7,130
|
13,880
|
13,033
|
13,257
|
8,457
|
7,416
|
|||||||||||||||||||||
Preferred OP Units
|
48,022
|
370
|
-
|
4,300
|
3,345
|
4,225
|
35,782
|
|||||||||||||||||||||
Secured borrowing
|
66,494
|
1,240
|
2,681
|
2,975
|
3,237
|
3,535
|
52,826
|
|||||||||||||||||||||
Total
|
$
|
1,251,317
|
$
|
8,740
|
$
|
196,849
|
$
|
51,885
|
$
|
46,678
|
$
|
497,111
|
$
|
450,054
|
8.
|
Equity Transactions
|
9.
|
Other Income (Loss)
|
|
|
|||||||||||||||
Three Months Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Brokerage commissions
|
$
|
135
|
$
|
138
|
$
|
274
|
$
|
273
|
||||||||
Loss on disposition of assets, net
|
(428
|
)
|
(132
|
)
|
(546
|
)
|
(115
|
)
|
||||||||
Other, net
|
(73
|
)
|
(66
|
)
|
178
|
(61
|
)
|
|||||||||
Total other income (loss), net
|
$
|
(366
|
)
|
$
|
(60
|
)
|
$
|
(94
|
)
|
$
|
97
|
10.
|
Segment Reporting
|
Three Months Ended June 30, 2010
|
Three Months Ended June 30, 2009
|
|||||||||||||||||||||||
Real Property Operations
|
Home Sales and Home Rentals
|
Consolidated
|
Real Property Operations
|
Home Sales and Home Rentals
|
Consolidated
|
|||||||||||||||||||
Revenues
|
$
|
49,948
|
$
|
14,650
|
$
|
64,598
|
$
|
48,497
|
$
|
13,405
|
$
|
61,902
|
||||||||||||
Operating expenses/Cost of sales
|
17,288
|
10,827
|
28,115
|
16,905
|
9,866
|
26,771
|
||||||||||||||||||
Net operating income/Gross profit
|
32,660
|
3,823
|
36,483
|
31,592
|
3,539
|
35,131
|
||||||||||||||||||
Adjustments to arrive at net income (loss):
|
||||||||||||||||||||||||
Other revenues
|
1,629
|
86
|
1,715
|
1,309
|
61
|
1,370
|
||||||||||||||||||
General and administrative
|
(5,627
|
)
|
(1,853
|
)
|
(7,480
|
)
|
(4,900
|
)
|
(1,816
|
)
|
(6,716
|
)
|
||||||||||||
Depreciation and amortization
|
(11,137
|
)
|
(5,267
|
)
|
(16,404
|
)
|
(11,153
|
)
|
(4,762
|
)
|
(15,915
|
)
|
||||||||||||
Interest expense
|
(16,122
|
)
|
(152
|
)
|
(16,274
|
)
|
(15,488
|
)
|
(86
|
)
|
(15,574
|
)
|
||||||||||||
Equity income (loss) from affiliates, net
|
(808
|
)
|
50
|
(758
|
)
|
(474
|
)
|
(43
|
)
|
(517
|
)
|
|||||||||||||
Provision for state income tax
|
(129
|
)
|
-
|
(129
|
)
|
(146
|
)
|
-
|
(146
|
)
|
||||||||||||||
Income (loss) from continuing operations
|
466
|
(3,313
|
)
|
(2,847
|
)
|
740
|
(3,107
|
)
|
(2,367
|
)
|
||||||||||||||
Loss from discontinued operations
|
-
|
-
|
-
|
(160
|
)
|
-
|
(160
|
)
|
||||||||||||||||
Net income (loss)
|
466
|
(3,313
|
)
|
(2,847
|
)
|
580
|
(3,107
|
)
|
(2,527
|
)
|
||||||||||||||
Less: Net income (loss) attributable to noncontrolling interest
|
(67
|
)
|
(331
|
)
|
(398
|
)
|
60
|
(328
|
)
|
(268
|
)
|
|||||||||||||
Net income (loss) attributable to Sun Communities, Inc.
|
$
|
533
|
$
|
(2,982
|
)
|
$
|
(2,449
|
)
|
$
|
520
|
$
|
(2,779
|
)
|
$
|
(2,259
|
)
|
10.
|
Segment Reporting, continued
|
Six Months Ended June 30, 2010
|
Six Months Ended June 30, 2009
|
|||||||||||||||||||||||
Real Property Operations
|
Home Sales and Home Rentals
|
Consolidated
|
Real Property Operations
|
Home Sales and Home Rentals
|
Consolidated
|
|||||||||||||||||||
Revenues
|
$
|
101,955
|
$
|
27,766
|
$
|
129,721
|
$
|
99,496
|
$
|
26,066
|
$
|
125,562
|
||||||||||||
Operating expenses/Cost of sales
|
34,508
|
20,694
|
55,202
|
33,694
|
19,826
|
53,520
|
||||||||||||||||||
Net operating income/Gross profit
|
67,447
|
7,072
|
74,519
|
65,802
|
6,240
|
72,042
|
||||||||||||||||||
Adjustments to arrive at net income (loss):
|
||||||||||||||||||||||||
Other revenues
|
3,702
|
307
|
4,009
|
2,738
|
256
|
2,994
|
||||||||||||||||||
General and administrative
|
(9,117
|
)
|
(3,786
|
)
|
(12,903
|
)
|
(9,066
|
)
|
(3,642
|
)
|
(12,708
|
)
|
||||||||||||
Depreciation and amortization
|
(22,411
|
)
|
(10,566
|
)
|
(32,977
|
)
|
(22,273
|
)
|
(9,846
|
)
|
(32,119
|
)
|
||||||||||||
Interest expense
|
(31,960
|
)
|
(236
|
)
|
(32,196
|
)
|
(30,503
|
)
|
(151
|
)
|
(30,654
|
)
|
||||||||||||
Equity income (loss) from affiliates, net
|
(1,627
|
)
|
50
|
(1,577
|
)
|
(375
|
)
|
(115
|
)
|
(490
|
)
|
|||||||||||||
Provision for state income tax
|
(261
|
)
|
-
|
(261
|
)
|
(279
|
)
|
-
|
(279
|
)
|
||||||||||||||
Income (loss) from continuing operations
|
5,773
|
(7,159
|
)
|
(1,386
|
)
|
6,044
|
(7,258
|
)
|
(1,214
|
)
|
||||||||||||||
Loss from discontinued operations
|
-
|
-
|
-
|
(332
|
)
|
-
|
(332
|
)
|
||||||||||||||||
Net income (loss)
|
5,773
|
(7,159
|
)
|
(1,386
|
)
|
5,712
|
(7,258
|
)
|
(1,546
|
)
|
||||||||||||||
Less: Net income (loss) attributable to noncontrolling interest
|
452
|
(726
|
)
|
(274
|
)
|
607
|
(771
|
)
|
(164
|
)
|
||||||||||||||
Net income (loss) attributable to Sun Communities, Inc.
|
$
|
5,321
|
$
|
(6,433
|
)
|
$
|
(1,112
|
)
|
$
|
5,105
|
$
|
(6,487
|
)
|
$
|
(1,382
|
)
|
June 30, 2010
|
December 31, 2009
|
|||||||||||||||||||||||
Real Property Operations
|
Home Sales and Home Rentals
|
Consolidated
|
Real Property Operations
|
Home Sales and Home Rentals
|
Consolidated
|
|||||||||||||||||||
Identifiable assets:
|
||||||||||||||||||||||||
Investment property, net
|
$
|
905,427
|
$
|
138,200
|
$
|
1,043,627
|
$
|
922,094
|
$
|
142,211
|
$
|
1,064,305
|
||||||||||||
Cash and cash equivalents
|
5,237
|
381
|
5,618
|
4,616
|
(120
|
)
|
4,496
|
|||||||||||||||||
Inventory of manufactured homes
|
-
|
2,457
|
2,457
|
-
|
3,934
|
3,934
|
||||||||||||||||||
Investment in affiliate
|
19
|
50
|
69
|
1,646
|
-
|
1,646
|
||||||||||||||||||
Notes and other receivables
|
79,201
|
3,512
|
82,713
|
69,625
|
4,405
|
74,030
|
||||||||||||||||||
Other assets
|
30,599
|
2,341
|
32,940
|
30,624
|
2,330
|
32,954
|
||||||||||||||||||
Total assets
|
$
|
1,020,483
|
$
|
146,941
|
$
|
1,167,424
|
$
|
1,028,605
|
$
|
152,760
|
$
|
1,181,365
|
11.
|
Derivative Instruments and Hedging Activities
|
11.
|
Derivative Instruments and Hedging Activities, continued
|
Type
|
Purpose
|
Effective Date
|
Maturity Date
|
Notional
(in millions)
|
Based on
|
Variable Rate
|
Fixed Rate
|
Spread
|
Effective Fixed Rate
|
|||||||||
Swap
|
Floating to Fixed Rate
|
09/04/02
|
07/03/12
|
25.0
|
3 Month LIBOR
|
0.2915%
|
4.7000%
|
2.0000%
|
6.7000%
|
|||||||||
Swap
|
Floating to Fixed Rate
|
01/02/09
|
01/02/14
|
20.0
|
3 Month LIBOR
|
0.2915%
|
2.1450%
|
2.0000%
|
4.1450%
|
|||||||||
Swap
|
Floating to Fixed Rate
|
02/13/09
|
02/13/11
|
25.0
|
1 Month LIBOR
|
0.3497%
|
1.5700%
|
2.0500%
|
3.6200%
|
|||||||||
Cap
|
Cap Floating Rate
|
04/28/09
|
05/01/12
|
152.4
|
3 Month LIBOR
|
0.5334%
|
11.0000%
|
0.0000%
|
N/A
|
Asset Derivatives
|
Liability Derivatives
|
|||||||||||||||||
Balance Sheet Location
|
Fair Value
|
Balance Sheet Location
|
Fair Value
|
|||||||||||||||
Derivatives designated as hedging instruments
|
June 30, 2010
|
December 31, 2009
|
June 30, 2010
|
December 31, 2009
|
||||||||||||||
Interest rate swaps and cap agreement
|
Other assets
|
$
|
-
|
$
|
379
|
Other liabilities
|
$
|
2,515
|
$
|
2,123
|
||||||||
Total derivatives designated as hedging instruments
|
$
|
-
|
$
|
379
|
$
|
2,515
|
$
|
2,123
|
Derivatives in cash flow hedging
|
Amount of Gain or (Loss) Recognized in OCI (Effective Portion)
|
Location of Gain or (Loss) Reclassified from Accumulated OCI into Income (Effective Portion)
|
Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income (Effective Portion)
|
Location of Gain or (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing)
|
Amount of Gain or (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing)
|
|||||||||||||||||||||
Three Months Ended June 30,
|
Three Months Ended June 30,
|
Three Months Ended June 30,
|
||||||||||||||||||||||||
2010
|
2009
|
2010
|
2009
|
2010
|
2009
|
|||||||||||||||||||||
Interest rate swaps and cap agreement
|
$
|
(325
|
)
|
$
|
1,330
|
Interest expense
|
$
|
-
|
$
|
-
|
Interest expense
|
$
|
(7
|
)
|
$
|
9
|
||||||||||
Total
|
$
|
(325
|
)
|
$
|
1,330
|
Total
|
$
|
-
|
$
|
-
|
Total
|
$
|
(7
|
)
|
$
|
9
|
11.
|
Derivative Instruments and Hedging Activities, continued
|
Derivatives in cash flow hedging
|
Amount of Gain or (Loss) Recognized in OCI (Effective Portion)
|
Location of Gain or (Loss) Reclassified from Accumulated OCI into Income (Effective Portion)
|
Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income (Effective Portion)
|
Location of Gain or (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing)
|
Amount of Gain or (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing)
|
|||||||||||||||||||||
Six Months Ended June 30,
|
Six Months Ended June 30,
|
Six Months Ended June 30,
|
||||||||||||||||||||||||
2010
|
2009
|
2010
|
2009
|
2010
|
2009
|
|||||||||||||||||||||
Interest rate swaps and cap agreement
|
$
|
(757
|
)
|
$
|
1,326
|
Interest expense
|
$
|
-
|
$
|
-
|
Interest expense
|
$
|
(13
|
)
|
$
|
12
|
||||||||||
Total
|
$
|
(757
|
)
|
$
|
1,326
|
Total
|
$
|
-
|
$
|
-
|
Total
|
$
|
(13
|
)
|
$
|
12
|
12.
|
Income Taxes
|
12.
|
Income Taxes, continued
|
13.
|
Loss Per Share
|
|
|
|||||||||||||||
Three Months Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||||||
Numerator
|
2010
|
2009
|
2010
|
2009
|
||||||||||||
Net loss from continuing operations attributable to common stockholders
|
$
|
(2,449
|
)
|
$
|
(2,116
|
)
|
$
|
(1,112
|
)
|
$
|
(1,085
|
)
|
||||
Denominator
|
||||||||||||||||
Basic weighted average common shares outstanding
|
19,031
|
18,469
|
18,848
|
18,399
|
||||||||||||
Add: dilutive securities
|
-
|
-
|
-
|
-
|
||||||||||||
Diluted weighted average common shares and securities
|
19,031
|
18,469
|
18,848
|
18,399
|
||||||||||||
Basic and diluted loss per share from continuing operations available to common stockholders
|
$
|
(0.13
|
)
|
$
|
(0.11
|
)
|
$
|
(0.06
|
)
|
$
|
(0.05
|
)
|
June 30,
|
||||||||
2010
|
2009
|
|||||||
Stock options
|
150
|
205
|
||||||
Unvested restricted stock
|
146
|
120
|
||||||
Common OP units
|
2,111
|
2,186
|
||||||
Convertible preferred OP units
|
526
|
526
|
||||||
Total securities
|
2,933
|
3,037
|
14.
|
Fair Value of Financial Instruments
|
June 30, 2010
|
December 31, 2009
|
|||||||||||||||
Financial assets
|
Carrying Value
|
Fair Value
|
Carrying Value
|
Fair Value
|
||||||||||||
Derivative instruments
|
$
|
-
|
$
|
-
|
$
|
379
|
$
|
379
|
||||||||
Installment notes on manufactured homes, net
|
8,633
|
8,633
|
12,627
|
12,627
|
||||||||||||
Collateralized receivables, net
|
66,296
|
-
|
52,201
|
-
|
||||||||||||
Financial liabilities
|
||||||||||||||||
Derivative instruments
|
$
|
2,515
|
$
|
2,515
|
$
|
2,123
|
$
|
2,123
|
||||||||
Long term debt (excluding secured borrowing)
|
1,099,242
|
1,074,874
|
1,107,074
|
1,057,326
|
||||||||||||
Secured borrowing
|
66,494
|
-
|
52,368
|
-
|
||||||||||||
Lines of credit
|
85,581
|
85,581
|
94,465
|
94,465
|
14.
|
Fair Value of Financial Instruments, continued
|
Assets
|
Total Fair Value
|
Level 1
|
Level 2
|
Level 3
|
||||||||||||
Derivative instruments
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
||||||||
Total assets
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
||||||||
Liabilities
|
||||||||||||||||
Derivative instruments
|
$
|
2,515
|
$
|
-
|
$
|
2,515
|
$
|
-
|
||||||||
Total liabilities
|
$
|
2,515
|
$
|
-
|
$
|
2,515
|
$
|
-
|
15.
|
Recent Accounting Pronouncements
|
16.
|
Commitments and Contingencies
|
17.
|
Subsequent Event
|
|
||||||||||||||||
Three Months Ended June 30,
|
||||||||||||||||
Financial Information (in thousands)
|
2010
|
2009
|
Change
|
% Change
|
||||||||||||
Income from Real Property
|
$
|
47,227
|
$
|
46,051
|
$
|
1,176
|
2.6
|
%
|
||||||||
Property operating expenses:
|
||||||||||||||||
Payroll and benefits
|
3,933
|
3,762
|
171
|
4.5
|
%
|
|||||||||||
Legal, taxes, & insurance
|
767
|
890
|
(123
|
)
|
-13.8
|
%
|
||||||||||
Utilities
|
2,693
|
3,000
|
(307
|
)
|
-10.2
|
%
|
||||||||||
Supplies and repair
|
2,303
|
2,057
|
246
|
12.0
|
%
|
|||||||||||
Other
|
688
|
632
|
56
|
8.9
|
%
|
|||||||||||
Real estate taxes
|
4,183
|
4,118
|
65
|
1.6
|
%
|
|||||||||||
Property operating expenses
|
14,567
|
14,459
|
108
|
0.7
|
%
|
|||||||||||
Real Property NOI
|
$
|
32,660
|
$
|
31,592
|
$
|
1,068
|
3.4
|
%
|
As of June 30,
|
||||||||||||
Other Information
|
2010
|
2009
|
Change
|
|||||||||
Number of properties
|
136
|
136
|
-
|
|||||||||
Developed sites
|
47,564
|
47,594
|
(30
|
)
|
||||||||
Occupied sites (1)
|
38,369
|
38,000
|
369
|
|||||||||
Occupancy % (1)
|
84.3
|
%
|
83.6
|
%
|
0.7
|
%
|
||||||
Weighted average monthly rent per site (2)
|
$
|
409
|
$
|
399
|
$
|
10
|
||||||
Sites available for development
|
5,574
|
5,583
|
(9
|
)
|
(1)
|
Occupied sites and occupancy % include manufactured housing and permanent recreational vehicle sites, and exclude seasonal recreational vehicle sites.
|
(2)
|
Average rent relates only to manufactured housing sites, and excludes permanent and seasonal recreational vehicle sites.
|
|
HOME SALES AND RENTALS
|
|
||||||||||||||||
Three Months Ended June 30,
|
||||||||||||||||
Financial Information
|
2010
|
2009
|
Change
|
% Change
|
||||||||||||
Rental home revenue
|
$
|
5,052
|
$
|
5,187
|
$
|
(135
|
)
|
-2.6
|
%
|
|||||||
Site rent from Rental Program (1)
|
7,118
|
6,673
|
445
|
6.7
|
%
|
|||||||||||
Rental Program revenue
|
12,170
|
11,860
|
310
|
2.6
|
%
|
|||||||||||
Expenses
|
||||||||||||||||
Payroll and commissions
|
438
|
596
|
(158
|
)
|
-26.5
|
%
|
||||||||||
Repairs and refurbishment
|
1,744
|
1,977
|
(233
|
)
|
-11.8
|
%
|
||||||||||
Taxes and insurance
|
812
|
776
|
36
|
4.6
|
%
|
|||||||||||
Marketing and other
|
600
|
673
|
(73
|
)
|
-10.8
|
%
|
||||||||||
Rental Program operating and maintenance
|
3,594
|
4,022
|
(428
|
)
|
-10.6
|
%
|
||||||||||
Rental Program NOI
|
$
|
8,576
|
$
|
7,838
|
$
|
738
|
9.4
|
%
|
||||||||
Other Information
|
||||||||||||||||
Number of occupied rentals, end of period*
|
5,953
|
5,780
|
173
|
3.0
|
%
|
|||||||||||
Investment in occupied rental homes
|
$
|
190,320
|
$
|
180,967
|
$
|
9,353
|
5.2
|
%
|
||||||||
Number of sold rental homes*
|
214
|
178
|
36
|
20.2
|
%
|
|||||||||||
Weighted average monthly rental rate*
|
$
|
729
|
$
|
726
|
$
|
3
|
0.4
|
%
|
(1)
|
The renter’s monthly payment includes the site rent and an amount attributable to the leasing of the home. The site rent is reflected in the Real Property Operations segment. For purposes of management analysis, the site rent is included in the Rental Program revenue to evaluate the growth and performance of the Rental Program.
|
Three Months EndedJune 30,
|
||||||||||||||||
Financial Information
|
2010
|
2009
|
Change
|
% Change
|
||||||||||||
New home sales
|
$
|
763
|
$
|
1,064
|
$
|
(301
|
)
|
-28.3
|
%
|
|||||||
Pre-owned home sales
|
8,835
|
7,154
|
1,681
|
23.5
|
%
|
|||||||||||
Revenue from homes sales
|
9,598
|
8,218
|
1,380
|
16.8
|
%
|
|||||||||||
New home cost of sales
|
604
|
917
|
(313
|
)
|
-34.1
|
%
|
||||||||||
Pre-owned home cost of sales
|
6,629
|
4,927
|
1,702
|
34.5
|
%
|
|||||||||||
Cost of home sales
|
7,233
|
5,844
|
1,389
|
23.8
|
%
|
|||||||||||
NOI / Gross profit
|
$
|
2,365
|
$
|
2,374
|
$
|
(9
|
)
|
-0.4
|
%
|
|||||||
Gross profit – new homes
|
159
|
147
|
12
|
8.2
|
%
|
|||||||||||
Gross margin % – new homes
|
20.8
|
%
|
13.8
|
%
|
7.0
|
%
|
||||||||||
Gross profit – pre-owned homes
|
2,206
|
2,227
|
(21
|
)
|
-0.9
|
%
|
||||||||||
Gross margin % – pre-owned homes
|
25.0
|
%
|
31.1
|
%
|
-6.1
|
%
|
||||||||||
Statistical Information
|
||||||||||||||||
Home sales volume:
|
||||||||||||||||
New home sales
|
11
|
15
|
(4
|
)
|
-26.7
|
%
|
||||||||||
Pre-owned home sales
|
396
|
255
|
141
|
55.3
|
%
|
|||||||||||
Total homes sold
|
407
|
270
|
137
|
50.7
|
%
|
|
||||||||
Three Months Ended June 30,
|
||||||||
2010
|
2009
|
|||||||
Revenues
|
$
|
64,598
|
$
|
61,902
|
||||
Operating expenses/Cost of sales
|
28,115
|
26,771
|
||||||
NOI/Gross profit
|
36,483
|
35,131
|
||||||
Adjustments to arrive at net loss:
|
||||||||
Other revenues
|
1,715
|
1,370
|
||||||
General and administrative
|
(7,480
|
)
|
(6,716
|
)
|
||||
Depreciation and amortization
|
(16,404
|
)
|
(15,915
|
)
|
||||
Interest expense
|
(16,274
|
)
|
(15,574
|
)
|
||||
Equity loss from affiliates, net
|
(758
|
)
|
(517
|
)
|
||||
Provision for state income taxes
|
(129
|
)
|
(146
|
)
|
||||
Loss from continuing operations
|
(2,847
|
)
|
(2,367
|
)
|
||||
Loss from discontinued operations
|
-
|
(160
|
)
|
|||||
Net loss
|
(2,847
|
)
|
(2,527
|
)
|
||||
Less: amounts attributable to noncontrolling interest
|
(398
|
)
|
(268
|
)
|
||||
Net loss attributable to Sun Communities, Inc. common stockholders
|
$
|
(2,449
|
)
|
$
|
(2,259
|
)
|
|
||||||||||||||||
Six Months Ended June 30,
|
||||||||||||||||
Financial Information (in thousands)
|
2010
|
2009
|
Change
|
% Change
|
||||||||||||
Income from Real Property
|
$
|
96,361
|
$
|
94,490
|
$
|
1,871
|
2.0
|
%
|
||||||||
Property operating expenses:
|
||||||||||||||||
Payroll and benefits
|
7,756
|
7,455
|
301
|
4.0
|
%
|
|||||||||||
Legal, taxes, & insurance
|
1,377
|
1,664
|
(287
|
)
|
-17.2
|
%
|
||||||||||
Utilities
|
6,172
|
6,509
|
(337
|
)
|
-5.2
|
%
|
||||||||||
Supplies and repair
|
3,603
|
3,251
|
352
|
10.8
|
%
|
|||||||||||
Other
|
1,643
|
1,507
|
136
|
9.0
|
%
|
|||||||||||
Real estate taxes
|
8,363
|
8,302
|
61
|
0.7
|
%
|
|||||||||||
Property operating expenses
|
28,914
|
28,688
|
226
|
0.8
|
%
|
|||||||||||
Real Property NOI
|
$
|
67,447
|
$
|
65,802
|
$
|
1,645
|
2.5
|
%
|
As of June 30,
|
||||||||||||
Other Information
|
2010
|
2009
|
Change
|
|||||||||
Number of properties
|
136
|
136
|
-
|
|||||||||
Developed sites
|
47,564
|
47,594
|
(30
|
)
|
||||||||
Occupied sites (1)
|
38,369
|
38,000
|
369
|
|||||||||
Occupancy % (1)
|
84.3
|
%
|
83.6
|
%
|
0.7
|
%
|
||||||
Weighted average monthly rent per site (2)
|
$
|
409
|
$
|
399
|
$
|
10
|
||||||
Sites available for development
|
5,574
|
5,583
|
(9
|
)
|
(1)
|
Occupied sites and occupancy % include manufactured housing and permanent recreational vehicle sites, and exclude seasonal recreational vehicle sites.
|
(2)
|
Average rent relates only to manufactured housing sites, and excludes permanent and seasonal recreational vehicle sites.
|
|
||||||||||||||||
Six Months Ended June 30,
|
||||||||||||||||
Financial Information
|
2010
|
2009
|
Change
|
% Change
|
||||||||||||
Rental home revenue
|
$
|
10,131
|
$
|
10,387
|
$
|
(256
|
)
|
-2.5
|
%
|
|||||||
Site rent from Rental Program (1)
|
14,134
|
13,123
|
1,011
|
7.7
|
%
|
|||||||||||
Rental Program revenue
|
24,265
|
23,510
|
755
|
3.2
|
%
|
|||||||||||
Expenses
|
||||||||||||||||
Payroll and commissions
|
938
|
1,379
|
(441
|
)
|
-32.0
|
%
|
||||||||||
Repairs and refurbishment
|
3,348
|
3,968
|
(620
|
)
|
-15.6
|
%
|
||||||||||
Taxes and insurance
|
1,595
|
1,546
|
49
|
3.2
|
%
|
|||||||||||
Marketing and other
|
1,336
|
1,666
|
(330
|
)
|
-19.8
|
%
|
||||||||||
Rental Program operating and maintenance
|
7,217
|
8,559
|
(1,342
|
)
|
-15.7
|
%
|
||||||||||
Rental Program NOI
|
$
|
17,048
|
$
|
14,951
|
$
|
2,097
|
14.0
|
%
|
||||||||
Other Information
|
||||||||||||||||
Number of occupied rentals, end of period*
|
5,953
|
5,780
|
173
|
3.0
|
%
|
|||||||||||
Investment in occupied rental homes
|
$
|
190,320
|
$
|
180,967
|
$
|
9,353
|
5.2
|
%
|
||||||||
Number of sold rental homes*
|
392
|
346
|
46
|
13.3
|
%
|
|||||||||||
Weighted average monthly rental rate*
|
$
|
729
|
$
|
726
|
$
|
3
|
0.4
|
%
|
(1)
|
The renter’s monthly payment includes the site rent and an amount attributable to the leasing of the home. The site rent is reflected in the Real Property Operations segment. For purposes of management analysis, the site rent is included in the Rental Program revenue to evaluate the growth and performance of the Rental Program.
|
Six Months Ended June 30,
|
||||||||||||||||
Financial Information
|
2010
|
2009
|
Change
|
% Change
|
||||||||||||
New home sales
|
$
|
1,660
|
$
|
2,352
|
$
|
(692
|
)
|
-29.4
|
%
|
|||||||
Pre-owned home sales
|
15,975
|
13,327
|
2,648
|
19.9
|
%
|
|||||||||||
Revenue from homes sales
|
17,635
|
15,679
|
1,956
|
12.5
|
%
|
|||||||||||
New home cost of sales
|
1,378
|
2,033
|
(655
|
)
|
-32.2
|
%
|
||||||||||
Pre-owned home cost of sales
|
12,099
|
9,234
|
2,865
|
31.0
|
%
|
|||||||||||
Cost of home sales
|
13,477
|
11,267
|
2,210
|
19.6
|
%
|
|||||||||||
NOI / Gross profit
|
$
|
4,158
|
$
|
4,412
|
$
|
(254
|
)
|
-5.8
|
%
|
|||||||
Gross profit – new homes
|
282
|
319
|
(37
|
)
|
-11.6
|
%
|
||||||||||
Gross margin % – new homes
|
17.0
|
%
|
13.6
|
%
|
3.4
|
%
|
||||||||||
Gross profit – pre-owned homes
|
3,876
|
4,093
|
(217
|
)
|
-5.3
|
%
|
||||||||||
Gross margin % – pre-owned homes
|
24.3
|
%
|
30.7
|
%
|
-6.4
|
%
|
||||||||||
Statistical Information
|
||||||||||||||||
Home sales volume:
|
||||||||||||||||
New home sales
|
26
|
34
|
(8
|
)
|
-23.5
|
%
|
||||||||||
Pre-owned home sales
|
706
|
484
|
222
|
45.9
|
%
|
|||||||||||
Total homes sold
|
732
|
518
|
214
|
41.3
|
%
|
|
||||||||
Six Months Ended June 30,
|
||||||||
2010
|
2009
|
|||||||
Revenues
|
$
|
129,721
|
$
|
125,562
|
||||
Operating expenses/Cost of sales
|
55,202
|
53,520
|
||||||
NOI/Gross profit
|
74,519
|
72,042
|
||||||
Adjustments to arrive at net loss:
|
||||||||
Other revenues
|
4,009
|
2,994
|
||||||
General and administrative
|
(12,903
|
)
|
(12,708
|
)
|
||||
Depreciation and amortization
|
(32,977
|
)
|
(32,119
|
)
|
||||
Interest expense
|
(32,196
|
)
|
(30,654
|
)
|
||||
Equity loss from affiliates, net
|
(1,577
|
)
|
(490
|
)
|
||||
Provision for state income taxes
|
(261
|
)
|
(279
|
)
|
||||
Loss from continuing operations
|
(1,386
|
)
|
(1,214
|
)
|
||||
Loss from discontinued operations
|
-
|
(332
|
)
|
|||||
Net loss
|
(1,386
|
)
|
(1,546
|
)
|
||||
Less: amounts attributable to noncontrolling interest
|
(274
|
)
|
(164
|
)
|
||||
Net loss attributable to Sun Communities, Inc. common stockholders
|
$
|
(1,112
|
)
|
$
|
(1,382
|
)
|
|
||||||||||||||||
Three Months Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Net loss
|
$
|
(2,847
|
)
|
$
|
(2,527
|
)
|
$
|
(1,386
|
)
|
$
|
(1,546
|
)
|
||||
Adjustments:
|
||||||||||||||||
Depreciation and amortization
|
16,808
|
16,414
|
33,842
|
33,035
|
||||||||||||
Benefit for state income taxes (1)
|
(13
|
)
|
-
|
(24
|
)
|
(13
|
)
|
|||||||||
Gain on disposition of assets, net
|
(806
|
)
|
(1,368
|
)
|
(1,655
|
)
|
(2,696
|
)
|
||||||||
Funds from operations (FFO)
|
$
|
13,142
|
$
|
12,519
|
$
|
30,777
|
$
|
28,780
|
||||||||
Weighted average Common Shares/OP Units outstanding:
|
||||||||||||||||
Basic
|
21,301
|
20,806
|
21,141
|
20,752
|
||||||||||||
Diluted
|
21,312
|
20,806
|
21,148
|
20,752
|
||||||||||||
FFO per weighted average Common Share/OP Unit - Basic
|
$
|
0.62
|
$
|
0.60
|
$
|
1.46
|
$
|
1.39
|
||||||||
FFO per weighted average Common Share/OP Unit - Diluted
|
$
|
0.62
|
$
|
0.60
|
$
|
1.46
|
$
|
1.39
|
|
|
|||||||||||||||
Three Months Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Net loss
|
$
|
(2,847
|
)
|
$
|
(2,527
|
)
|
$
|
(1,386
|
)
|
$
|
(1,546
|
)
|
||||
Michigan Business tax reversal
|
-
|
-
|
(740
|
)
|
-
|
|||||||||||
Equity affiliate adjustment
|
808
|
474
|
1,627
|
375
|
||||||||||||
Adjusted net loss
|
(2,039
|
)
|
(2,053
|
)
|
(499
|
)
|
(1,171
|
)
|
||||||||
Depreciation and amortization
|
16,808
|
16,414
|
33,842
|
33,035
|
||||||||||||
Benefit for state income taxes (1)
|
(13
|
)
|
-
|
(24
|
)
|
(13
|
)
|
|||||||||
Gain on disposition of assets, net
|
(806
|
)
|
(1,368
|
)
|
(1,655
|
)
|
(2,696
|
)
|
||||||||
Adjusted funds from operations (FFO)
|
$
|
13,950
|
$
|
12,993
|
$
|
31,664
|
$
|
29,155
|
||||||||
Adjusted FFO per weighted average Common Share/OP Unit - Diluted
|
$
|
0.66
|
$
|
0.62
|
$
|
1.50
|
$
|
1.40
|
|
(1) The tax benefit for the periods ended June 30, 2010 and 2009 represents the reversal of a tax provision for potential taxes payable on the sale of company assets related to the enactment of the Michigan Business Tax. These taxes do not impact Funds from Operations and would be payable from prospective proceeds of such sales.
|
2010
|
$0.4 million
|
2011
|
$103.7 million and any balance outstanding on the unsecured line of credit or the floor plan facility
|
2012
|
$35.8 million
|
2013
|
$30.2 million
|
2014
|
$485.1 million
|
|
(a)
|
Under the supervision and with the participation of our management, including the Chief Executive Officer, Gary A. Shiffman, and Chief Financial Officer, Karen J. Dearing, we evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this quarterly report, pursuant to Rule 13a-15 of the Securities Exchange Act of 1934 (the “Exchange Act”). Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures as of the end of the period covered by this report were effective to ensure that information we are required to disclose in our filings with the SEC under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and to ensure that information we are required to disclose in th
e reports that we file under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
|
|
(b)
|
There have been no changes in our internal control over financial reporting during the quarterly period ended June 30, 2010 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
|
Exhibit No.
|
Description
|
|
31.1
|
Certification of Chief Executive Officer pursuant to Securities Exchange Act Rules 13a-14(a)/15(d)-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
31.2
|
Certification of Chief Financial Officer pursuant to Securities Exchange Act Rules 13a-14(a)/15(d)-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
32.1
|
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
SUN COMMUNITIES, INC.
|
|||
Dated: July 28, 2010
|
By:
|
/s/ Karen J. Dearing
|
|
Karen J. Dearing, Chief Financial Officer and Secretary
(Duly authorized officer and principal financial officer)
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Sun Communities, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function):
|
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Dated: July 28, 2010
|
/s/ Gary A. Shiffman
|
||
Gary A. Shiffman, Chief Executive Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Sun Communities, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function):
|
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Dated: July 28, 2010
|
/s/ Karen J. Dearing
|
||
Karen J. Dearing, Chief Financial Officer
|
Signature
|
Date
|
|
/s/ Gary A. Shiffman
|
July 28, 2010
|
|
Gary A. Shiffman, Chief Executive Officer
|
||
/s/ Karen J. Dearing
|
July 28, 2010
|
|
Karen J. Dearing, Chief Financial Officer
|
||