UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8‑K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report: February 20, 2014
(Date of earliest event reported)
SUN COMMUNITIES, INC.
(Exact name of registrant as specified in its charter)
Maryland | 1-12616 | 38-2730780 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) | ||
27777 Franklin Rd. | ||
Suite 200 | ||
Southfield, Michigan | 48034 | |
(Address of Principal Executive Offices) | (Zip Code) | |
(248) 208-2500 |
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 2.02 | Results of Operations and Financial Condition |
On February 20, 2014, Sun Communities, Inc. (the “Company”) issued a press release, furnished as Exhibit 99.1 and incorporated herein by reference, announcing its financial results for the period ended December 31, 2013, and certain other information.
The Company will hold an investor conference call and webcast at 11:00 a.m. EST on February 20, 2014 to disclose and discuss the financial results for the period ended December 31, 2013.
The information contained in this Current Report on Form 8-K, including the exhibit attached hereto, is being furnished and shall not be deemed to be “filed” for purposes of the Securities Exchange Act of 1934, as amended.
Item 9.01 | Financial Statements and Exhibits |
(d) | Exhibits. |
99.1 | Press release issued February 20, 2014 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.
SUN COMMUNITIES, INC. | |||
Dated: February 20, 2014 | By: | /s/ Karen J. Dearing | |
Karen J. Dearing, Executive Vice President, Chief Financial Officer, Secretary and Treasurer | |||
EXHIBIT INDEX
Exhibit No. | Description | |
99.1 | Press release issued February 20, 2014 | |
NEWS RELEASE
February 20, 2014
Sun Communities, Inc. Reports 2013 Fourth Quarter and Year End Results
Southfield, MI, February 20, 2014 - Sun Communities, Inc. (NYSE: SUI) (the “Company”), a real estate investment trust (“REIT”) that owns and operates manufactured housing and recreational vehicle communities, today reported its fourth quarter and year end results.
Highlights: Three Months Ended December 31, 2013
• | FFO(1) excluding $1.2 million of acquisition related costs was $0.78 per diluted share and OP unit ("Share") for the three months ended December 31, 2013. |
• | Same site Net Operating Income (“NOI”)(2) increased by 7.2 percent as compared to the three months ended December 31, 2012. |
• | Revenue producing sites increased by 573 sites compared to an increase of 94 during the three months ended December 31, 2012 bringing total portfolio occupancy to 89.7 percent as compared to 87.3 percent at December 31, 2012. |
• | One manufactured home community and two recreational vehicle communities were acquired during the fourth quarter of 2013 for $40.7 million increasing the 2013 total to fifteen properties acquired for a total of $182.4 million. |
" We are pleased with our strong performance for 2013 resulting from the successful execution of our business plan and strategies," said Gary A. Shiffman, Chairman and CEO. " During the year our core portfolio achieved robust 5.9% NOI growth, we expanded our presence in high quality recreational vehicle communities while broadening our geographic diversity and repositioned several of our new destination resorts for double digit revenue growth in 2014. With a substantial pipeline of acquisition opportunities and current year FFO guidance yielding 9.5%-12.5% growth, we announced our intent to increase our annual distribution to $2.60 per common share; our first distribution increase since 2005," Shiffman added.
Funds from Operations (“FFO”)(1)
FFO(1) was $29.5 million, or $0.75 per Share, in the fourth quarter of 2013 as compared to $23.3 million, or $0.71 per Share, in the fourth quarter of 2012. Excluding approximately $1.2 million and $2.9 million of transaction costs incurred in connection with acquisition activity during the three months ended December 31, 2013 and 2012, respectively, FFO(1) was $30.6 million and $26.2 million, or $0.78 and $0.80 per Share for the three months ended December 31, 2013 and 2012, respectively.
FFO(1) was $117.6 million, or $3.11 per Share, for the year ended December 31, 2013 as compared to $92.4 million, or $3.05 per Share, in the year ended December 31, 2012. Excluding approximately $3.9 million and $4.3 million of transaction costs incurred in connection with acquisition activity during the year ended December 31, 2013 and 2012, respectively, FFO(1) was $121.5 million and $96.7 million, or $3.22 and $3.19 per Share for the year ended December 31, 2013 and 2012, respectively.
Net Income Attributable to Common Stockholders
Net income attributable to common stockholders for the fourth quarter of 2013 was $0.1 million, compared with net loss of $(1.4) million, or $(0.05) per diluted common share, for the fourth quarter of 2012. Net income attributable to common stockholders for the year ended December 31, 2013 was $10.6 million, or $0.31 per diluted common share, compared with net income of $5.0 million, or $0.18 per diluted common share, for the year ended December 31, 2012.
Community Occupancy
During the fourth quarter of 2013, revenue producing sites increased by 573 sites as compared to 94 revenue producing sites gained in the fourth quarter of 2012. Of the 573 sites, 446 were gained in same site properties while the remaining 127 were gained in properties acquired in 2012 and 2013. Total portfolio occupancy increased to 89.7 percent at December 31, 2013 from 87.3 percent at December 31, 2012.
During the year ended December 31, 2013, revenue producing sites increased by 1,885 sites as compared to an increase of 1,069 sites during the year ended December 31, 2012. Of the 1,885 sites, 1,429 were gained in same site properties while the remaining 456 were gained in properties acquired in 2012 and 2013.
The Company rented an additional 494 homes during the three months ended December 31, 2013, bringing the total number of occupied rentals to 9,726.
Same Site Results
For 159 communities owned throughout 2013 and 2012, fourth quarter 2013 total revenues increased 5.6 percent and total expenses increased 1.7 percent, resulting in an increase in NOI(2) of 7.2 percent over the fourth quarter of 2012. For the year ended December 31, 2013 total revenues increased 5.1 percent and total expenses increased 3.2 percent, resulting in an increase in NOI(2) of 5.9 percent over the year ended December 31, 2012. Same site occupancy increased to 88.9 percent at December 31, 2013 from 87.1 percent at December 31, 2012.
Home Sales
During the fourth quarter of 2013, 496 homes were sold, an increase of 7 sales, or 1.4 percent, from the 489 homes sold during the fourth quarter of 2012. Rental home sales, which are included in total home sales, were 235 and 275 for the fourth quarters of 2013 and 2012, respectively.
During the year ended December 31, 2013, 1,929 homes were sold, an increase of 187 sales or 10.7 percent, from the 1,742 homes sold during the year ended December 31, 2012. Rental home sales, which are included in total home sales, were 924 and 953 for the year ended December 31, 2013 and 2012, respectively.
Applications to live in the Company's communities were 30,700 in 2013, an increase of approximately 18 percent from 26,100 in 2012.
Acquisitions
As previously announced, from November 2013 through January 2014, the Company acquired four recreational vehicle communities and one manufactured housing community, with approximately 1,650 developed sites and 70 sites available for expansion, for a combined purchase price of $90.3 million. The
Sun Communities, Inc. 4th Quarter 2013 Page 3
recreational vehicle communities are located in New York, California (2) and Maryland and the manufactured housing community is located in Michigan.
In February 2014, the Company acquired two additional recreational vehicle communities, with approximately 1,381 developed sites and 30 sites available for expansion, located in the Cape May area of New Jersey, for a combined purchase price of $56.5 million.
"Our focus on acquisitions in the RV marketplace is based in part on increases in the annual shipments of RV's, which are expected to increase by 6% in 2014 marking the fifth consecutive annual increase in shipments," Shiffman said. " In addition, over 40% of demand for RV parks is from adults over 55 years of age which is a growing segment of our population," Shiffman added.
Financing
On December 31, 2013, the Company entered into a ten year loan agreement for $141.5 million at a rate of 4.9 percent. The agreement includes three years of interest only payments.
Subsequent to year end, the Company entered into a twelve year loan agreement for $99.0 million at a rate of 4.20 percent.
The combined loans, totaling $240.5 million are secured by twenty-three communities and a portion of the proceeds were used to pay in full eleven loans totaling $176.3 million which were secured by twenty-three communities and due to mature July 1, 2014.
" With continued focus on balance sheet management, we took the opportunity to capitalize on attractive financing markets to expand and extend our secured line of credit and refinance debt in advance of its maturity at very attractive long term rates," Shiffman said. " Our activity in the debt markets has extended our weighted average maturity of debt and reduced debt maturities to $11.5 million and $56.3 million in 2014 and 2015, respectively," Shiffman added.
Executive Officer Promotion
Effective February 12, 2014, the Company's Board of Directors appointed Mr. John B. McLaren as President of the Company. Mr. McLaren continues to serve as the Chief Operating Officer of the Company. Mr. McLaren replaced Gary A. Shiffman as the Company's President. Mr. Shiffman continues to serve as the Chairman and Chief Executive Officer and as a director of the Company.
Guidance
The Company maintains its full year 2014 FFO(1) guidance of $3.52-$3.62 per Share and its FFO(1) guidance for the first quarter of 2014 of $0.92-$0.94 per Share. Guidance includes acquisitions completed through January 2014.
The estimates and assumptions are forward looking based on the Company's current assessment of economic and market conditions, as well as other risks outlined below under the caption "Forward-Looking Statements" and may differ materially from actual results.
Sun Communities, Inc. 4th Quarter 2013 Page 4
Earnings Conference Call
A conference call to discuss fourth quarter operating results will be held on Thursday, February 20, 2014 at 11:00 A.M. (EST). To participate, call toll-free 877-941-0844. Callers outside the U.S. or Canada can access the call at 480-629-9835. A replay will be available following the call through March 6, 2014, and can be accessed toll-free by calling 800-406-7325 or by calling 303-590-3030. The Conference ID number for the call and the replay is 4658089. The conference call will be available live on Sun Communities website www.suncommunities.com. Replay will also be available on the website.
Sun Communities, Inc. is a REIT that currently owns and operates a portfolio of 192 communities comprising approximately 71,150 developed sites.
For more information about Sun Communities, Inc., please visit our website at www.suncommunities.com.
Contact
Please address all inquiries to our investor relations department, at our website www.suncommunities.com, by phone (248) 208-2500, by email investorrelations@suncommunities.com or by mail Sun Communities, Inc. Investor Relations, 27777 Franklin Road, Ste. 200, Southfield, MI 48034.
(1) | Funds from operations (“FFO”) is defined by the National Association of Real Estate Investment Trusts (“NAREIT”) as net income (loss) (computed in accordance with generally accepted accounting principles “GAAP”), excluding gains (or losses) from sales of depreciable operating property, plus real estate-related depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. FFO is a non-GAAP financial measure that management believes is a useful supplemental measure of the Company's operating performance. Management generally considers FFO to be a useful measure for reviewing comparative operating and financial performance because, by excluding gains and losses related to sales of previously depreciated operating real estate assets, impairment and excluding real estate asset depreciation and amortization (which can vary among owners of identical assets in similar condition based on historical cost accounting and useful life estimates), FFO provides a performance measure that, when compared year over year, reflects the impact to operations from trends in occupancy rates, rental rates and operating costs, providing perspective not readily apparent from net loss. Management believes that the use of FFO has been beneficial in improving the understanding of operating results of REITs among the investing public and making comparisons of REIT operating results more meaningful. FFO is computed in accordance with the Company's interpretation of standards established by NAREIT, which may not be comparable to FFO reported by other REITs that do not define the term in accordance with the current NAREIT definition or that interpret the current NAREIT definition differently than the Company. |
Because FFO excludes significant economic components of net income (loss) including depreciation and amortization, FFO should be used as an adjunct to net income (loss) and not as an alternative to net income (loss). The principal limitation of FFO is that it does not represent cash flow from operations as defined by GAAP and is a supplemental measure of performance that does not replace net income (loss) as a measure of performance or net cash provided by operating activities as a measure of liquidity. In addition, FFO is not intended as a measure of a REIT's ability to meet debt principal repayments and other cash requirements, nor as a measure of working capital. FFO only provides investors with an additional performance measure.
(2) | Investors in and analysts following the real estate industry utilize NOI as a supplemental performance measure. NOI is derived from revenues minus property operating expenses and real estate taxes. NOI does not represent cash generated from operating activities in accordance with GAAP and should not be considered to be an alternative to net income (loss) (determined in accordance with GAAP) as an indication of the Company's financial performance or to be an alternative to cash flow from operating activities (determined in accordance with GAAP) as a measure of the Company's liquidity; nor is it indicative of funds available for the Company's cash needs, including its ability to make cash distributions. The Company believes that net income (loss) is the most directly comparable GAAP measurement to NOI. Net income (loss) includes interest and depreciation and amortization which often have no effect on the market value of a property and therefore limit its use as a performance measure. In addition, such expenses are often incurred at a parent company level and therefore are not necessarily linked to the performance of a real estate asset. The Company believes that NOI is helpful to investors as a measure of operating performance because it is an indicator of the return on property investment, and provides a method of comparing property performance over time. The Company uses NOI as a key management tool when evaluating performance and growth of particular properties and/or groups of properties. The principal limitation of NOI is that it excludes depreciation, amortization, interest expense, and non-property specific expenses such as general and administrative expenses, all of which are significant costs, and therefore, NOI is a measure of the operating performance of the properties of the Company rather than of the Company overall. |
Forward Looking Statements
This press release contains various “forward-looking statements” within the meaning of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended, and the Company intends that such forward-looking statements will be subject to the safe harbors created thereby. Forward-looking statements can be identified by words such as “will,” “may,” “could,” “expect,” “anticipate,” “believes,” “intends,” “should,” “plans,” “estimates,” “approximate”, “guidance” and similar expressions in this press release that predict or indicate future events and trends and that do not report historical matters.
These forward-looking statements reflect the Company’s current views with respect to future events and financial performance, but involve known and unknown risks, uncertainties, and other factors, some of which are beyond our control. These risks, uncertainties, and other factors may cause the actual results of the Company to be materially different from any future results expressed or implied by such forward-looking statements. Such risks and uncertainties include national, regional and local economic climates, the ability to maintain rental rates and occupancy levels, competitive market forces, changes in market rates of interest, the ability of manufactured home buyers to obtain financing, the level of repossessions by manufactured home lenders and those risks and uncertainties referenced under the headings entitled “Risk Factors” contained in our 2012 Annual Report, and the Company’s other periodic filings with the Securities and Exchange Commission.
The forward-looking statements contained in this press release speak only as of the date hereof and the Company expressly disclaims any obligation to provide public updates, revisions or amendments to any forward- looking statements made herein to reflect changes in the Company’s assumptions, expectations of future events, or trends.
Sun Communities, Inc. 4th Quarter 2013 Page 6
Consolidated Balance Sheets
(in thousands, except per share amounts)
As of December 31, | |||||||
2013 | 2012 | ||||||
ASSETS | |||||||
Investment property, net (including $56,805 and $56,326 for consolidated variable interest entities at December 31, 2013 and December 31, 2012, respectively) | $ | 1,755,052 | $ | 1,518,136 | |||
Cash and cash equivalents | 4,753 | 29,508 | |||||
Inventory of manufactured homes | 5,810 | 7,527 | |||||
Notes and other receivables, net | 164,685 | 139,850 | |||||
Other assets | 68,936 | 59,607 | |||||
TOTAL ASSETS | $ | 1,999,236 | $ | 1,754,628 | |||
LIABILITIES | |||||||
Debt (including $45,209 and $45,900 for consolidated variable interest entities at December 31, 2013 and 2012, respectively) | $ | 1,311,437 | $ | 1,423,720 | |||
Lines of credit | 181,383 | 29,781 | |||||
Other liabilities | 109,342 | 88,137 | |||||
TOTAL LIABILITIES | $ | 1,602,162 | $ | 1,541,638 | |||
Commitments and contingencies | |||||||
STOCKHOLDERS’ EQUITY | |||||||
Preferred stock, $0.01 par value, Authorized: 10,000 shares; Issued and outstanding: 3,400 shares at December 31, 2013 and 2012 | $ | 34 | $ | 34 | |||
Common stock, $0.01 par value. Authorized: 90,000 shares; Issued and outstanding: 36,140 at December 31, 2013 and 29,755 shares at December 31, 2012 | 361 | 298 | |||||
Additional paid-in capital | 1,141,590 | 876,620 | |||||
Accumulated other comprehensive loss | (366 | ) | (696 | ) | |||
Distributions in excess of accumulated earnings | (761,112 | ) | (683,734 | ) | |||
Total Sun Communities, Inc. stockholders' equity | 380,507 | 192,522 | |||||
Noncontrolling interests: | |||||||
Series A-1 preferred OP units | 45,548 | 45,548 | |||||
Series A-3 preferred OP units | 3,463 | — | |||||
Common OP units | (31,907 | ) | (24,572 | ) | |||
Consolidated variable interest entities | (537 | ) | (508 | ) | |||
Total noncontrolling interest | 16,567 | 20,468 | |||||
TOTAL STOCKHOLDERS’ EQUITY | 397,074 | 212,990 | |||||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 1,999,236 | $ | 1,754,628 | |||
Sun Communities, Inc. 4th Quarter 2013 Page 7
Consolidated Statements of Operations
(in thousands, except per share amounts)
Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
REVENUES | |||||||||||||||
Income from real property | $ | 78,128 | $ | 66,943 | $ | 313,097 | $ | 255,761 | |||||||
Revenue from home sales | 14,652 | 13,634 | 54,852 | 45,147 | |||||||||||
Rental home revenue | 8,717 | 7,075 | 32,500 | 26,589 | |||||||||||
Ancillary revenues, net | (226 | ) | (56 | ) | 1,151 | (180 | ) | ||||||||
Interest | 3,486 | 3,111 | 13,073 | 11,018 | |||||||||||
Brokerage commissions and other income, net | 200 | 87 | 549 | 617 | |||||||||||
Total revenues | 104,957 | 90,794 | 415,222 | 338,952 | |||||||||||
COSTS AND EXPENSES | |||||||||||||||
Property operating and maintenance | 21,044 | 17,578 | 87,637 | 68,839 | |||||||||||
Real estate taxes | 5,138 | 4,466 | 22,284 | 19,207 | |||||||||||
Cost of home sales | 10,937 | 10,383 | 40,297 | 34,918 | |||||||||||
Rental home operating and maintenance | 6,183 | 5,051 | 20,435 | 18,141 | |||||||||||
General and administrative - real property | 6,855 | 4,632 | 25,941 | 20,037 | |||||||||||
General and administrative - home sales and rentals | 2,439 | 2,331 | 9,913 | 8,316 | |||||||||||
Acquisition related costs | 1,159 | 2,862 | 3,928 | 4,296 | |||||||||||
Depreciation and amortization | 29,962 | 26,647 | 110,078 | 89,674 | |||||||||||
Interest | 18,451 | 17,215 | 73,339 | 67,859 | |||||||||||
Interest on mandatorily redeemable debt | 808 | 822 | 3,238 | 3,321 | |||||||||||
Total expenses | 102,976 | 91,987 | 397,090 | 334,608 | |||||||||||
Income (loss) before income taxes and distributions from affiliate | 1,981 | (1,193 | ) | 18,132 | 4,344 | ||||||||||
Provision for state income taxes | (48 | ) | (59 | ) | (234 | ) | (249 | ) | |||||||
Distributions from affiliate | 700 | 650 | 2,250 | 3,900 | |||||||||||
Net income (loss) | 2,633 | (602 | ) | 20,148 | 7,995 | ||||||||||
Less: Preferred return to Series A-1 preferred OP units | 689 | 585 | 2,598 | 2,329 | |||||||||||
Less: Preferred return to Series A-3 preferred OP units | 45 | — | 166 | — | |||||||||||
Less: Amounts attributable to noncontrolling interests | 303 | (781 | ) | 718 | (318 | ) | |||||||||
Net income (loss) attributable to Sun Communities, Inc. | 1,596 | (406 | ) | 16,666 | 5,984 | ||||||||||
Less: Series A preferred stock distributions | 1,514 | 1,026 | 6,056 | 1,026 | |||||||||||
Net income (loss) attributable to Sun Communities, Inc. common stockholders | $ | 82 | $ | (1,432 | ) | $ | 10,610 | $ | 4,958 | ||||||
Weighted average common shares outstanding: | |||||||||||||||
Basic | 36,140 | 29,444 | 34,732 | 27,255 | |||||||||||
Diluted | 36,152 | 29,444 | 34,747 | 27,272 | |||||||||||
Earnings per share: | |||||||||||||||
Basic | $ | 0.00 | $ | (0.05 | ) | $ | 0.31 | $ | 0.18 | ||||||
Diluted | $ | 0.00 | $ | (0.05 | ) | $ | 0.31 | $ | 0.18 | ||||||
Distributions per common share:: | $ | 0.63 | $ | 0.63 | $ | 2.52 | $ | 2.52 | |||||||
Sun Communities, Inc. 4th Quarter 2013 Page 8
Reconciliation of Net Income to FFO(1)
(in thousands, except per share amounts)
Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Net income (loss) attributable to Sun Communities, Inc. common stockholders | $ | 82 | $ | (1,432 | ) | $ | 10,610 | $ | 4,958 | ||||||
Adjustments: | |||||||||||||||
Preferred return to Series A-1 preferred OP units | 689 | 585 | 2,598 | 2,329 | |||||||||||
Preferred return to Series A-3 preferred OP units | 45 | — | 166 | — | |||||||||||
Amounts attributable to noncontrolling interests | 303 | (781 | ) | 718 | (318 | ) | |||||||||
Depreciation and amortization | 30,157 | 26,779 | 111,083 | 90,577 | |||||||||||
Gain on disposition of assets, net | (1,787 | ) | (1,813 | ) | (7,592 | ) | (5,137 | ) | |||||||
Funds from operations ("FFO") (1) | 29,489 | 23,338 | 117,583 | 92,409 | |||||||||||
Adjustments: | |||||||||||||||
Acquisition related costs | 1,159 | 2,862 | 3,928 | 4,296 | |||||||||||
Funds from operations excluding certain items | $ | 30,648 | $ | 26,200 | $ | 121,511 | $ | 96,705 | |||||||
Weighted average common shares outstanding: | 35,508 | 29,444 | 34,228 | 26,970 | |||||||||||
Add: | |||||||||||||||
Common OP Units | 2,069 | 2,069 | 2,069 | 2,071 | |||||||||||
Restricted stock | 632 | 294 | 504 | 285 | |||||||||||
Common stock issuable upon conversion of Series A-1 preferred OP units | 1,111 | 1,111 | 1,111 | 1,111 | |||||||||||
Common stock issuable upon conversion of Series A-3 preferred OP units | 75 | — | 67 | — | |||||||||||
Common stock issuable upon conversion of stock options | 12 | 15 | 15 | 17 | |||||||||||
Weighted average common shares outstanding - fully diluted | 39,407 | 32,933 | 37,994 | 30,454 | |||||||||||
FFO(1) per Share - fully diluted | $ | 0.75 | $ | 0.71 | $ | 3.11 | $ | 3.05 | |||||||
FFO(1) per Share excluding certain items - fully diluted | $ | 0.78 | $ | 0.80 | $ | 3.22 | $ | 3.19 | |||||||
Sun Communities, Inc. 4th Quarter 2013 Page 9
Statement of Operations – Same Site
(in thousands except for Other Information)
Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||||||||||||||||
2013 | 2012 | Change | % Change | 2013 | 2012 | Change | % Change | ||||||||||||||||||||||
REVENUES: | |||||||||||||||||||||||||||||
Income from real property | $ | 62,004 | $ | 58,699 | $ | 3,305 | 5.6 | % | $ | 245,703 | $ | 233,858 | $ | 11,845 | 5.1 | % | |||||||||||||
PROPERTY OPERATING EXPENSES: | |||||||||||||||||||||||||||||
Payroll and benefits | 4,950 | 4,844 | 106 | 2.2 | % | 20,689 | 19,452 | 1,237 | 6.4 | % | |||||||||||||||||||
Legal, taxes, & insurance | 1,146 | 842 | 304 | 36.1 | % | 4,101 | 3,125 | 976 | 31.2 | % | |||||||||||||||||||
Utilities | 3,254 | 3,120 | 134 | 4.3 | % | 13,624 | 13,279 | 345 | 2.6 | % | |||||||||||||||||||
Supplies and repair | 2,134 | 2,136 | (2 | ) | (0.1 | )% | 9,279 | 9,687 | (408 | ) | (4.2 | )% | |||||||||||||||||
Other | 1,140 | 1,458 | (318 | ) | (21.8 | )% | 5,366 | 5,491 | (125 | ) | (2.3 | )% | |||||||||||||||||
Real estate taxes | 4,293 | 4,238 | 55 | 1.3 | % | 18,970 | 18,783 | 187 | 1.0 | % | |||||||||||||||||||
Property operating expenses | 16,917 | 16,638 | 279 | 1.7 | % | 72,029 | 69,817 | 2,212 | 3.2 | % | |||||||||||||||||||
NET OPERATING INCOME ("NOI")(2) | $ | 45,087 | $ | 42,061 | $ | 3,026 | 7.2 | % | $ | 173,674 | $ | 164,041 | $ | 9,633 | 5.9 | % | |||||||||||||
As of December 31, | |||||||||||
OTHER INFORMATION | 2013 | 2012 | Change | ||||||||
Number of properties | 159 | 159 | — | ||||||||
Developed sites | 55,590 | 55,006 | 584 | ||||||||
Occupied sites (3) | 46,908 | 45,224 | 1,684 | ||||||||
Occupancy % (3) (4) | 88.9 | % | 87.1 | % | 1.8 | % | |||||
Weighted average monthly rent per site - MH | $ | 445 | $ | 433 | $ | 12 | |||||
Weighted average monthly rent per site - RV (5) | $ | 416 | $ | 409 | $ | 7 | |||||
Sites available for development | 5,631 | 6,104 | (473 | ) | |||||||
(3) | Occupied sites and occupancy % include manufactured housing and annual/seasonal RV sites, and exclude transient RV sites. |
(4) | Occupancy % excludes recently completed but vacant expansion sites. |
(5) | Weighted average rent pertains to annual/seasonal RV sites and excludes transient RV sites. |
Sun Communities, Inc. 4th Quarter 2013 Page 10
Rental Program Summary
(in thousands except for *)
Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||||||||||||||||
2013 | 2012 | Change | % Change | 2013 | 2012 | Change | % Change | ||||||||||||||||||||||
REVENUES: | |||||||||||||||||||||||||||||
Rental home revenue | $ | 8,717 | $ | 7,075 | $ | 1,642 | 23.2 | % | $ | 32,500 | $ | 26,589 | $ | 5,911 | 22.2 | % | |||||||||||||
Site rent included in Income from real property | 12,301 | 10,272 | 2,029 | 19.8 | % | 46,416 | 38,636 | 7,780 | 20.1 | % | |||||||||||||||||||
Rental Program revenue | 21,018 | 17,347 | 3,671 | 21.2 | % | 78,916 | 65,225 | 13,691 | 21.0 | % | |||||||||||||||||||
EXPENSES: | |||||||||||||||||||||||||||||
Commissions | 703 | 560 | 143 | 25.5 | % | 2,507 | 2,207 | 300 | 13.6 | % | |||||||||||||||||||
Repairs and refurbishment | 3,030 | 2,434 | 596 | 24.5 | % | 9,411 | 9,002 | 409 | 4.5 | % | |||||||||||||||||||
Taxes and insurance | 1,213 | 958 | 255 | 26.6 | % | 4,446 | 3,467 | 979 | 28.2 | % | |||||||||||||||||||
Marketing and other | 1,237 | 1,099 | 138 | 12.6 | % | 4,071 | 3,465 | 606 | 17.5 | % | |||||||||||||||||||
Rental Program operating and maintenance | 6,183 | 5,051 | 1,132 | 22.4 | % | 20,435 | 18,141 | 2,294 | 12.6 | % | |||||||||||||||||||
NET OPERATING INCOME ("NOI") (2) | $ | 14,835 | $ | 12,296 | $ | 2,539 | 20.6 | % | $ | 58,481 | $ | 47,084 | $ | 11,397 | 24.2 | % | |||||||||||||
Occupied rental home information as of December 31, 2013 and 2012: | |||||||||||||||||||||||||||||
Number of occupied rentals, end of period* | 9,726 | 8,110 | 1,616 | 19.9 | % | ||||||||||||||||||||||||
Investment in occupied rental homes | $ | 355,789 | $ | 287,261 | $ | 68,528 | 23.9 | % | |||||||||||||||||||||
Number of sold rental homes* | 924 | 953 | (29 | ) | (3.0 | )% | |||||||||||||||||||||||
Weighted average monthly rental rate* | $ | 796 | $ | 782 | $ | 14 | 1.8 | % | |||||||||||||||||||||
Sun Communities, Inc. 4th Quarter 2013 Page 11
Acquisition Summary - Properties Acquired in 2012 and 2013
(amounts in thousands except for statistical data)
Three Months Ended December 31, 2013 | Twelve Months Ended December 31, 2013 | ||||||
REVENUES: | |||||||
Income from real property | $ | 11,981 | $ | 51,149 | |||
Revenue from home sales | 2,767 | 6,910 | |||||
Rental home revenue | 444 | 1,072 | |||||
Ancillary revenues, net | (265 | ) | 1,017 | ||||
Total revenues | 14,927 | 60,148 | |||||
COSTS AND EXPENSES: | |||||||
Property operating and maintenance | 4,278 | 18,335 | |||||
Real estate taxes | 844 | 3,313 | |||||
Cost of home sales | 2,125 | 5,482 | |||||
Rental home operating and maintenance | 196 | 454 | |||||
Total expenses | 7,443 | 27,584 | |||||
NET OPERATING INCOME ("NOI") (2) | $ | 7,484 | $ | 32,564 | |||
Home sales volume : | |||||||
Pre-Owned homes | 139 | ||||||
As of December 31, 2013 | |||||||
Other information: | |||||||
Number of properties | 29 | ||||||
Developed sites | 14,079 | ||||||
Occupied sites (3) | 8,551 | ||||||
Occupancy % (3) | 96.2 | % | |||||
Weighted average monthly rent per site - MH | $ | 419 | |||||
Weighted average monthly rent per site - RV (5) | $ | 342 | |||||
Occupied rental home information : | |||||||
Number of occupied rentals, end of period | 499 | ||||||
Investment in occupied rental homes (in thousands) | $ | 16,975 | |||||
Weighted average monthly rental rate | $ | 857 | |||||
Sun Communities, Inc. 4th Quarter 2013 Page 12