Exhibit

EX-99.1 2 exhibit991pressrelease.htm EXHIBIT 99.1 PRESS RELEASE AND SUPPLEMENTAL PACKAGE SEPTEMBER 30, 2019 Exhibit

Table of Contents



Summary - Earnings Press Release	i - vi

Investor Information	1

Portfolio Overview	2

Financial Information
Balance Sheets	3
Statements of Operations	4
Outstanding Securities and Capitalization	5
Reconciliations to Non-GAAP Financial Measures	6
Reconciliation of Net Income to Funds from Operations	7
Reconciliation of Net Income to Recurring EBITDA	8
Reconciliation of Net Income to Net Operating Income	9
Non-GAAP and Other Financial Measures	10
Financial and Operating Highlights	11
Debt Analysis	12

Selected Financial Information
Real Property Operations – Same Community	13
Home Sales Summary	14
Rental Program Summary	15
Acquisitions and Other Summary	16

Other Information
Property Summary	17 - 18
Capital Improvements, Development, and Acquisitions	19
Operating Statistics for Manufactured Homes and Annual RV’s	20
Footnotes and Definitions	21 - 23

NEWS RELEASE

October 23, 2019

Sun Communities, Inc. Reports 2019 Third Quarter Results

Southfield, Michigan, October 23, 2019 – Sun Communities, Inc. (NYSE: SUI) (the “Company”), a real estate investment trust (“REIT”) that owns and operates, or has an interest in, manufactured housing (“MH”) and recreational vehicle (“RV”) communities, today reported its third quarter results for 2019.

Financial Results for the Quarter and Nine Months Ended September 30, 2019

For the quarter ended September 30, 2019, total revenues increased $39.0 million, or 12.1 percent, to $362.4 million compared to $323.4 million for the same period in 2018. Net income attributable to common stockholders was $57.0 million, or $0.63 per diluted common share, for the quarter ended September 30, 2019, as compared to net income attributable to common stockholders of $46.1 million, or $0.56 per diluted common share, for the same period in 2018.

For the nine months ended September 30, 2019, total revenues increased $109.4 million, or 12.8 percent, to $962.2 million compared to $852.8 million for the same period in 2018. Net income attributable to common stockholders was $131.7 million, or $1.50 per diluted common share, for the nine months ended September 30, 2019, as compared to net income attributable to common stockholders of $96.5 million, or $1.19 per diluted common share, for the same period in 2018.

Non-GAAP Financial Measures and Portfolio Performance


•	Core Funds from Operations (“Core FFO”)⁽¹⁾for the quarter ended September 30, 2019, was $1.46 per diluted share and OP unit (“Share”) as compared to $1.35 in the prior year, an increase of 8.1 percent.


•	Same Community⁽²⁾ Net Operating Income (“NOI”)⁽¹⁾ increased by 7.2 percent for the quarter ended September 30, 2019, as compared to the same period in 2018.


•	Same Community⁽²⁾ Occupancy increased by 210 basis points to 98.3 percent, as compared to 96.2 percent at September 30, 2018.


•	Revenue Producing Sites increased by 766 sites for the quarter ended September 30, 2019, bringing total portfolio occupancy to 96.7 percent.

Gary Shiffman, Chief Executive Officer of Sun Communities stated, “During the third quarter, we continued our consistent track record of delivering strong organic growth, as portfolio-wide occupancy gains along with tight cost controls contributed to 7.2 percent same community NOI growth. These results were further enhanced by the solid performance at our recent acquisitions. Despite a competitive acquisition environment, Sun has completed over $444.0 million of transactions year to date which will strengthen our growth over time. We believe that our ability to address sellers’ needs for flexible exit and monetization strategies will continue to be a competitive advantage in our pursuit of accretive acquisitions.”

OPERATING HIGHLIGHTS

Portfolio Occupancy

Total portfolio occupancy was 96.7 percent at September 30, 2019, compared to 96.1 percent at September 30, 2018.

During the quarter ended September 30, 2019, revenue producing sites increased by 766 sites, as compared to 628 revenue producing sites gained during the third quarter of 2018, a 22.0 percent increase.

During the nine months ended September 30, 2019, revenue producing sites increased by 2,005 sites, as compared to an increase of 1,878 revenue producing sites during the nine months ended September 30, 2018, a 6.8 percent increase.

Same Community⁽²⁾Results

For the 345 communities owned and operated by the Company since January 1, 2018, NOI⁽¹⁾ for the quarter ended September 30, 2019, increased 7.2 percent over the same period in 2018, as a result of a 6.1 percent increase in revenues, and 3.9 percent increase in operating expenses. Same Community occupancy⁽³⁾ increased to 98.3 percent at September 30, 2019 from 96.2 percent at September 30, 2018.

For the nine months ended September 30, 2019, NOI⁽¹⁾ increased 7.2 percent over the same period in 2018, as a result of a 6.2 percent increase in revenues, and a 3.9 percent increase in operating expenses.

Home Sales

During the quarter ended September 30, 2019, the Company sold 906 homes as compared to 971 homes sold during the same period in 2018. New home sales volume increased 14.4 percent to 167 new home sales for the quarter ended September 30, 2019, as compared to 146 homes in the same period in 2018. Rental home sales, which are included in total home sales, were 317 in 2019, as compared to 316 sold during 2018.

During the nine months ended September 30, 2019, 2,631 homes were sold compared to 2,751 for the same period in 2018. New home sales volume increased 11.7 percent to 431 new home sales for the nine months ended September 30, 2019, as compared to 386 homes during the same period in 2018. Rental home sales, which are included in total home sales, were 859 in 2019, an increase of 4.1 percent over the 825 sold during 2018.

PORTFOLIO ACTIVITY

Acquisitions

During the quarter ended September 30, 2019, the Company acquired the following communities:



Community Name	Type	Sites		Expansion Sites	State	Total Purchase Price (in millions)		Month Acquired
Glen Ellis	RV	244		40	NH	$	6.0	September
Leisure Point Resort	MH / RV	502	⁽¹⁾	—	DE	$	44.5	September
Chincoteague Island	RV	—		—	VA	$	19.5	August
Reunion Lake	RV	202		69	LA	$	23.5	July

⁽¹⁾Contains 201 MH sites and 301 RV sites.

For the nine months ended September 30, 2019, the Company acquired 14 communities, totaling 5,058 sites, for a total purchase price of $444.2 million.

Pending Transaction - Jensen Portfolio

On August 22, 2019, the Company entered into an agreement to acquire a 31-community manufactured housing portfolio (the “Jensen Portfolio”) for $343.6 million. The Jensen Portfolio has 5,230 operating sites and 466 additional sites available for development. The 31 communities are located in eight states across the eastern United States. The purchase price will be paid through a combination of $274.8 million shares of common stock and cash consideration. We expect to acquire the Jensen Portfolio no later than October 31, 2019. However, the closing is subject to the satisfaction of customary closing conditions, including obtaining certain third party consents. If these conditions are not satisfied or waived, or if the merger agreement is otherwise terminated in accordance with its terms, then the acquisition will not be consummated.

Construction Activity

During the quarter ended September 30, 2019, the Company completed the construction of 485 sites at the following ground-up developments:



Community Name	Type	State	Completed Construction Sites	Remaining Construction Sites ⁽¹⁾
Carolina Pines	RV	SC	105	460
Jellystone Golden Valley	RV	NC	113	202
River Run Ranch	RV	CO	215	929
Smith Creek Crossing	MH	CO	52	258

⁽¹⁾Remaining sites are approximate and may be adjusted as final construction is completed.

During the quarter ended September 30, 2019, the Company completed the construction of 177 expansion sites in three communities. Year to date, the Company has completed the construction of 365 expansion sites in 10 communities. The Company expects to complete the construction of an additional 800 to 1,000 expansion sites by year end.

iii

BALANCE SHEET AND CAPITAL MARKETS ACTIVITY

Series A-4 Preferred Stock and Series A-4 Preferred OP Units Conversion

The Company intends to convert 1,051,501 shares of Series A-4 preferred stock and 405,656 Series A-4 preferred OP units issued by the Operating Partnership into its common stock and common OP units. Each share of Series A-4 preferred stock is convertible into approximately 0.4444 shares of common stock and each Series A-4 preferred OP unit is convertible into approximately 0.4444 common OP units. The Company has the right under its charter and the Operating Partnership’s partnership agreement to convert these securities, if at any time after November 26, 2019, the volume weighted average of the daily volume weighted average price of a share of its common stock on the New York Stock Exchange is equal to or greater than $64.97 for at least 20 trading days in a period of 30 consecutive trading days (the “Pricing Target”). On October 17, 2019, the Company’s Board of Directors approved the conversion of all of the Series A-4 preferred stock and Series A-4 preferred OP units into common stock and common OP units, respectively, provided that the Pricing Target is satisfied on November 27, 2019. If the Pricing target is satisfied, the conversion is expected to occur on December 13, 2019.

Debt Transactions

As of September 30, 2019, the Company had $3.3 billion of debt outstanding. The weighted average interest rate was 4.3 percent and the weighted average maturity was 9.8 years. The Company had $26.2 million of unrestricted cash on hand. At period-end the Company’s net debt to trailing twelve month Recurring EBITDA⁽¹⁾ ratio was 5.3 times.

During the quarter ended September 30, 2019, the Company completed a $250.0 million ten-year term loan transaction which carries an interest rate of 2.925 percent. Concurrently, the Company repaid a $134.0 million term loan which was due to mature in May 2023.

GUIDANCE 2019

The Company is revising its 2019 guidance for the following metrics:



	Previous Range FY 2019E	Revised Range FY 2019E	4Q 2019E
Net Income per fully diluted share	$1.81 - $1.87	$1.77 - $1.81	$0.28 - $0.32
Core FFO ⁽¹⁾ per fully diluted share	$4.84 - $4.90	$4.86 - $4.90	$1.04 - $1.08

Same Community⁽²⁾ Portfolio

Number of communities: 345



	2019E Change %
Income from real property	6.0% - 6.2%
Total property operating expenses	4.1% - 4.5%
Net operating income ⁽¹⁾	6.8% - 7.2%

Guidance estimates include the 31-community Jensen Portfolio acquisition, which is expected to close by October 31, 2019, and exclude any other prospective acquisitions and capital markets activity.

Core FFO⁽¹⁾ per Share estimates assume certain gain and loss items that management considers unrelated to the operational and financial performance of our core business will be adjusted from FFO⁽¹⁾. The estimates and assumptions presented above represent a range of possible outcomes and may differ materially from actual results. 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.”

EARNINGS CONFERENCE CALL

A conference call to discuss third quarter operating results will be held on Thursday, October 24, 2019 at 11:00 A.M. (ET). To participate, call toll-free 877-407-9039. Callers outside the U.S. or Canada can access the call at 201-689-8470. A replay will be available following the call through November 7, 2019 and can be accessed toll-free by calling 844-512-2921 or 412-317-6671. The Conference ID number for the call and the replay is 13694212. The conference call will be available live on Sun Communities’ website located at www.suncommunities.com. The replay will also be available on the website.

Sun Communities, Inc. is a REIT that, as of September 30, 2019, owned, operated, or had an interest in a portfolio of 389 communities comprising over 134,000 developed sites in 32 states and Ontario, Canada.

For more information about Sun Communities, Inc., please visit www.suncommunities.com.

CONTACT

Please address all inquiries to our investor relations department at our website www.suncommunities.com, by phone to (248) 208-2500, by email to investorrelations@suncommunities.com or by mail to Sun Communities, Inc. Attn: Investor Relations, 27777 Franklin Road, Ste. 200, Southfield, MI 48034.

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 the Company’s 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, the performance of recent acquisitions, the ability to integrate future acquisitions smoothly and efficiently, changes in market rates of interest, changes in foreign currency exchange rates, the ability of manufactured home buyers to obtain financing and the level of repossessions by manufactured home lenders. Further details of potential risks that may affect the Company are described in its periodic reports filed with the U.S. Securities and Exchange Commission, including in the “Risk Factors” section of the Company’s Annual Report on Form 10-K.

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.

Investor Information



RESEARCH COVERAGE

Firm	Analyst	Phone	Email
Bank of America Merrill Lynch	Joshua Dennerlein	(646) 855-1681	joshua.dennerlein@baml.com
BMO Capital Markets	John Kim	(212) 885-4115	johnp.kim@bmo.com
Citi Research	Michael Bilerman	(212) 816-1383	michael.bilerman@citi.com
	Nicholas Joseph	(212) 816-1909	nicholas.joseph@citi.com
Evercore ISI	Steve Sakwa	(212) 446-9462	steve.sakwa@evercoreisi.com
	Samir Khanal	(212) 888-3796	samir.khanal@evercoreisi.com
Green Street Advisors	John Pawlowski	(949) 640-8780	jpawlowski@greenstreetadvisors.com
RBC Capital Markets	Wes Golladay	(440) 715-2650	wes.golladay@rbccm.com
Robert W. Baird & Co.	Drew Babin	(610) 238-6634	dbabin@rwbaird.com
Wells Fargo	Todd Stender	(562) 637-1371	todd.stender@wellsfargo.com


INQUIRIES

Sun Communities welcomes questions or comments from stockholders, analysts, investment managers, media, or any prospective investor. Please address all inquiries to our Investor Relations department.

At Our Website	www.suncommunities.com

By Email	investorrelations@suncommunities.com

By Phone	(248) 208-2500

3rd Quarter 2019 Supplemental Information 1 Sun Communities, Inc.

Portfolio Overview

(As of September 30, 2019)

3rd Quarter 2019 Supplemental Information 2 Sun Communities, Inc.

Balance Sheets

(amounts in thousands)



	(Unaudited)
	September 30, 2019			December 31, 2018
Assets
Land	$	1,311,103		$	1,201,945
Land improvements and buildings	6,200,895			5,586,250
Rental homes and improvements	614,002			571,661
Furniture, fixtures and equipment	251,363			201,090
Investment property	8,377,363			7,560,946
Accumulated depreciation	(1,619,924		)	(1,442,630		)
Investment property, net	6,757,439			6,118,316
Cash and cash equivalents	26,198			50,311
Marketable securities	64,818			49,037
Inventory of manufactured homes	55,234			49,199
Notes and other receivables, net	174,934			160,077
Collateralized receivables, net ⁽⁴⁾	93,054			106,924
Other assets, net	226,177			176,162
Total Assets	$	7,397,854		$	6,710,026
Liabilities
Mortgage loans payable	$	2,967,128		$	2,815,957
Secured borrowings on collateralized receivables⁽⁴⁾	93,669			107,731
Preferred Equity - Sun NG Resorts - mandatorily redeemable	35,249			35,277
Preferred OP units - mandatorily redeemable	34,663			37,338
Lines of credit ⁽⁵⁾	140,632			128,000
Distributions payable	69,726			63,249
Advanced reservation deposits and rent	137,797			133,698
Other liabilities	242,119			157,862
Total Liabilities	3,720,983			3,479,112
Commitments and contingencies
Series A-4 preferred stock	31,402			31,739
Series A-4 preferred OP units	9,540			9,877
Series D preferred OP units	51,248			—
Equity Interests - NG Sun LLC and NG Whitewater	27,461			21,976
Stockholders' Equity
Common stock	907			864
Additional paid-in capital	4,854,958			4,398,949
Accumulated other comprehensive loss	(2,825		)	(4,504		)
Distributions in excess of accumulated earnings	(1,353,214		)	(1,288,486		)
Total Sun Communities, Inc. stockholders' equity	3,499,826			3,106,823
Noncontrolling interests
Common and preferred OP units	49,540			53,354
Consolidated variable interest entities	7,854			7,145
Total noncontrolling interests	57,394			60,499
Total Stockholders' Equity	3,557,220			3,167,322
Total Liabilities, Temporary Equity and Stockholders' Equity	$	7,397,854		$	6,710,026

3rd Quarter 2019 Supplemental Information 3 Sun Communities, Inc.

Statements of Operations - Quarter to Date and Year to Date Comparison

(amounts in thousands, except per share amounts) (Unaudited)



	Three Months Ended											Nine Months Ended
	September 30, 2019			September 30, 2018			Change			% Change		September 30, 2019			September 30, 2018			Change			% Change
Revenues
Income from real property (excluding transient revenue)	$	202,205		$	184,414		$	17,791		9.6	%	$	588,272		$	536,704		$	51,568		9.6	%
Transient revenue	54,218			45,193			9,025			20.0	%	111,029			88,784			22,245			25.1	%
Revenue from home sales	49,805			46,131			3,674			8.0	%	136,665			122,248			14,417			11.8	%
Rental home revenue	14,444			13,589			855			6.3	%	42,827			39,957			2,870			7.2	%
Ancillary revenue	31,999			27,608			4,391			15.9	%	57,746			46,207			11,539			25.0	%
Interest income	4,770			5,256			(486		)	(9.2	)%	14,489			15,849			(1,360		)	(8.6	)%
Brokerage commissions and other revenues, net	5,002			1,222			3,780			309.3	%	11,190			3,073			8,117			264.1	%
Total Revenues	362,443			323,413			39,030			12.1	%	962,218			852,822			109,396			12.8	%
Expenses
Property operating and maintenance	79,095			71,656			7,439			10.4	%	202,892			181,977			20,915			11.5	%
Real estate taxes	15,399			14,533			866			6.0	%	46,455			42,445			4,010			9.4	%
Cost of home sales	36,318			33,692			2,626			7.8	%	100,030			91,195			8,835			9.7	%
Rental home operating and maintenance	6,008			6,236			(228		)	(3.7	)%	15,887			16,778			(891		)	(5.3	)%
Ancillary expenses	18,707			15,361			3,346			21.8	%	38,288			28,985			9,303			32.1	%
Home selling expenses	3,988			4,043			(55		)	(1.4	)%	10,938			11,319			(381		)	(3.4	)%
General and administrative expenses	22,975			19,763			3,212			16.3	%	68,559			60,972			7,587			12.4	%
Catastrophic weather related charges, net	341			173			168			97.1	%	1,302			(1,987		)	3,289			(165.5	)%
Depreciation and amortization	76,532			71,982			4,550			6.3	%	229,241			206,192			23,049			11.2	%
Loss on extinguishment of debt	12,755			528			12,227			2,315.7	%	13,478			1,255			12,223			973.9	%
Interest expense	32,219			33,932			(1,713		)	(5.0	)%	99,894			98,321			1,573			1.6	%
Interest on mandatorily redeemable preferred OP units / equity	1,216			1,142			74			6.5	%	3,491			2,551			940			36.8	%
Total Expenses	305,553			273,041			32,512			11.9	%	830,455			740,003			90,452			12.2	%
Income Before Other Items	56,890			50,372			6,518			12.9	%	131,763			112,819			18,944			16.8	%
Remeasurement of marketable securities	12,661			—			12,661			N/A		16,548			—			16,548			N/A
Other income / (expense), net ⁽⁶⁾	(4,408		)	1,231			(5,639		)	(458.1	)%	(1,489		)	(3,214		)	1,725			(53.7	)%
Income from nonconsolidated affiliates	77			126			(49		)	(38.9	)%	814			59			755			1,279.7	%
Current tax expense	(420		)	(213		)	(207		)	97.2	%	(906		)	(612		)	(294		)	48.0	%
Deferred tax benefit / (expense)	(349		)	199			(548		)	(275.4	)%	(36		)	434			(470		)	(108.3	)%
Net Income	64,451			51,715			12,736			24.6	%	146,694			109,486			37,208			34.0	%
Less: Preferred return to preferred OP units / equity	(1,599		)	(1,152		)	447			38.8	%	(4,640		)	(3,335		)	1,305			39.1	%
Less: Amounts attributable to noncontrolling interests	(5,422		)	(4,071		)	1,351			33.2	%	(9,048		)	(8,392		)	656			7.8	%
Net Income attributable to Sun Communities, Inc.	57,430			46,492			10,938			23.5	%	133,006			97,759			35,247			36.1	%
Less: Preferred stock distribution	(428		)	(432		)	(4		)	(0.9	)%	(1,288		)	(1,305		)	(17		)	(1.3	)%
Net Income attributable to Sun Communities, Inc. common stockholders	$	57,002		$	46,060		$	10,942		23.8	%	$	131,718		$	96,454		$	35,264		36.6	%

Weighted average common shares outstanding - basic	89,847			81,599			8,248			10.1	%	87,499			80,022			7,477			9.3	%
Weighted average common shares outstanding - diluted	90,332			82,081			8,251			10.1	%	87,931			80,024			7,907			9.9	%

Basic earnings per share	$	0.63		$	0.56		$	0.07		12.5	%	$	1.49		$	1.19		$	0.30		25.2	%
Diluted earnings per share	$	0.63		$	0.56		$	0.07		12.5	%	$	1.50		$	1.19		$	0.31		26.1	%

3rd Quarter 2019 Supplemental Information 4 Sun Communities, Inc.

Outstanding Securities and Capitalization

(amounts in thousands except for *)



Outstanding Securities - As of September 30, 2019

	Number of Units/Shares Outstanding	Conversion Rate*	If Converted	Issuance Price per unit*	Annual Distribution Rate*
Non-convertible securities
Common shares	90,683	N/A	N/A	N/A	$3.00^

Convertible securities
Series A-1 preferred OP units	316	2.4390	771	$100	6.0%
Series A-3 preferred OP units	40	1.8605	75	$100	4.5%
Series A-4 preferred OP units	406	0.4444	180	$25	6.5%
Series C preferred OP units	310	1.1100	345	$100	4.5%
Series D preferred OP units	489	0.8000	391	$100	3.8%
Common OP units	2,282	1.0000	2,282	N/A	Mirrors common shares distributions
Series A-4 preferred stock	1,052	0.4444	468	$25	6.5%
^ Annual distribution is based on the last quarterly distribution annualized.



Capitalization - As of September 30, 2019

Equity	Shares	Share Price*		Total
Common shares	90,683	$	148.45	$	13,461,891
Common OP units	2,282	$	148.45	338,763
Subtotal	92,965			$	13,800,654

Series A-1 preferred OP units	771	$	148.45	$	114,455
Series A-3 preferred OP units	75	$	148.45	11,134
Series A-4 preferred OP units	180	$	148.45	26,721
Series C preferred OP units	345	$	148.45	51,215
Series D preferred OP units	391	$	148.45	58,044
Total diluted shares outstanding	94,727			$	14,062,223

Debt
Mortgage loans payable				$	2,967,128
Secured borrowings on collateralized receivables ⁽⁴⁾				93,669
Preferred Equity - Sun NG Resorts - mandatorily redeemable				35,249
Preferred OP units - mandatorily redeemable				34,663
Lines of credit ⁽⁵⁾				140,632
Total debt				$	3,271,341

Preferred
Series A-4 preferred stock	1,052	$	25.00	$	26,300
Total Capitalization				$	17,359,864

3rd Quarter 2019 Supplemental Information 5 Sun Communities, Inc.

Reconciliations to Non-GAAP Financial Measures

3rd Quarter 2019 Supplemental Information 6 Sun Communities, Inc.

Reconciliation of Net Income Attributable to Sun Communities, Inc. Common Stockholders to FFO

(amounts in thousands except for per share data)



	Three Months Ended						Nine Months Ended
	September 30, 2019			September 30, 2018			September 30, 2019			September 30, 2018
Net income attributable to Sun Communities, Inc. common stockholders	$	57,002		$	46,060		$	131,718		$	96,454
Adjustments
Depreciation and amortization	76,692			72,269			229,698			206,892
Remeasurement of marketable securities	(12,661		)	—			(16,548		)	—
Amounts attributable to noncontrolling interests	4,839			4,311			7,720			7,724
Preferred return to preferred OP units	530			549			1,594			1,654
Preferred distribution to Series A-4 preferred stock	428			432			1,288			1,305
Gain on disposition of assets, net	(7,334		)	(6,603		)	(21,083		)	(16,977		)
FFO attributable to Sun Communities, Inc. common stockholders and dilutive convertible securities ^{(1) (7)}	$	119,496		$	117,018		$	334,387		$	297,052
Adjustments
Other acquisition related costs ⁽⁸⁾	375			345			902			781
Loss on extinguishment of debt	12,755			528			13,478			1,255
Catastrophic weather related charges, net	363			173			1,339			(1,987		)
Loss of earnings - catastrophic weather related ⁽⁹⁾	(377		)	325			—			975
Other (income) / expense ⁽⁶⁾	4,408			(1,231		)	1,489			3,214
Ground lease intangible write-off	—			—			—			817
Deferred tax (benefit) / expense	349			(199		)	36			(434		)
Core FFO attributable to Sun Communities, Inc. common stockholders and dilutive convertible securities ^{(1) (7)}	$	137,369		$	116,959		$	351,631		$	301,673

Weighted average common shares outstanding - basic	89,847			81,599			87,499			80,022
Add
Common stock issuable upon conversion of stock options	1			2			1			2
Restricted stock	484			480			431			633
Common OP units	2,284			2,731			2,498			2,735
Common stock issuable upon conversion of Series A-4 preferred stock	467			472			467			472
Common stock issuable upon conversion of Series A-3 preferred OP units	75			75			75			75
Common stock issuable upon conversion of Series A-1 preferred OP units	780			813			792			825
Common stock issuable upon conversion of Aspen preferred OP units	—			448			—			—
Weighted average common shares outstanding - fully diluted	93,938			86,620			91,763			84,764

FFO attributable to Sun Communities, Inc. common stockholders and dilutive convertible securities ^{(1) (7)} per share - fully diluted	$	1.27		$	1.35		$	3.64		$	3.50
Core FFO attributable to Sun Communities, Inc. common stockholders and dilutive convertible securities ^{(1) (7)} per share - fully diluted	$	1.46		$	1.35		$	3.83		$	3.56

3rd Quarter 2019 Supplemental Information 7 Sun Communities, Inc.

Reconciliation of Net Income Attributable to Sun Communities, Inc. Common Stockholders to Recurring EBITDA

(amounts in thousands)



	Three Months Ended						Nine Months Ended
	September 30, 2019			September 30, 2018			September 30, 2019			September 30, 2018
Net Income attributable to Sun Communities, Inc. common stockholders	$	57,002		$	46,060		$	131,718		$	96,454
Adjustments
Depreciation and amortization	76,532			71,982			229,241			206,192
Loss on extinguishment of debt	12,755			528			13,478			1,255
Interest expense	33,435			35,074			103,385			100,872
Current tax expense	420			213			906			612
Deferred tax (benefit) / expense	349			(199		)	36			(434		)
Income from nonconsolidated affiliates	(77		)	(126		)	(814		)	(59		)
Less: Gain on dispositions of assets, net	(7,334		)	(6,603		)	(21,083		)	(16,977		)
EBITDAre ⁽¹⁾	$	173,082		$	146,929		$	456,867		$	387,915
Adjustments
Catastrophic weather related charges, net	341			173			1,302			(1,987		)
Remeasurement of marketable securities	(12,661		)	—			(16,548		)	—
Other (income) / expense, net ⁽⁶⁾	4,408			(1,231		)	1,489			3,214
Preferred return to preferred OP units / equity	1,599			1,152			4,640			3,335
Amounts attributable to noncontrolling interests	5,422			4,071			9,048			8,392
Preferred stock distribution	428			432			1,288			1,305
Plus: Gain on dispositions of assets, net	7,334			6,603			21,083			16,977
Recurring EBITDA ⁽¹⁾	$	179,953		$	158,129		$	479,169		$	419,151

3rd Quarter 2019 Supplemental Information 8 Sun Communities, Inc.

Reconciliation of Net Income Attributable to Sun Communities, Inc. Common Stockholders to NOI

(amounts in thousands)



	Three Months Ended						Nine Months Ended
	September 30, 2019			September 30, 2018			September 30, 2019			September 30, 2018
Net Income attributable to Sun Communities, Inc. common stockholders	$	57,002		$	46,060		$	131,718		$	96,454
Other revenues	(9,772		)	(6,478		)	(25,679		)	(18,922		)
Home selling expenses	3,988			4,043			10,938			11,319
General and administrative expenses	22,975			19,763			68,559			60,972
Catastrophic weather related charges, net	341			173			1,302			(1,987		)
Depreciation and amortization	76,532			71,982			229,241			206,192
Loss on extinguishment of debt	12,755			528			13,478			1,255
Interest expense	33,435			35,074			103,385			100,872
Remeasurement of marketable securities	(12,661		)	—			(16,548		)	—
Other (income) / expense, net ⁽⁶⁾	4,408			(1,231		)	1,489			3,214
Income from nonconsolidated affiliates	(77		)	(126		)	(814		)	(59		)
Current tax expense	420			213			906			612
Deferred tax (benefit) / expense	349			(199		)	36			(434		)
Preferred return to preferred OP units / equity	1,599			1,152			4,640			3,335
Amounts attributable to noncontrolling interests	5,422			4,071			9,048			8,392
Preferred stock distribution	428			432			1,288			1,305
NOI ⁽¹⁾/ Gross Profit	$	197,144		$	175,457		$	532,987		$	472,520



	Three Months Ended						Nine Months Ended
	September 30, 2019			September 30, 2018			September 30, 2019			September 30, 2018
Real Property NOI⁽¹⁾	$	161,929		$	143,418		$	449,954		$	401,066
Home Sales NOI ⁽¹⁾/ Gross Profit	13,487			12,439			36,635			31,053
Rental Program NOI ⁽¹⁾	25,706			23,750			78,266			72,424
Ancillary NOI ⁽¹⁾/ Gross Profit	13,292			12,247			19,458			17,222
Site rent from Rental Program (included in Real Property NOI) ^{(1) (10)}	(17,270		)	(16,397		)	(51,326		)	(49,245		)
NOI ⁽¹⁾/ Gross Profit	$	197,144		$	175,457		$	532,987		$	472,520

3rd Quarter 2019 Supplemental Information 9 Sun Communities, Inc.

Non-GAAP and Other Financial Measures

3rd Quarter 2019 Supplemental Information 10 Sun Communities, Inc.

Financial and Operating Highlights

(amounts in thousands, except for *)



	Quarter Ended
	9/30/2019		6/30/2019		3/31/2019		12/31/2018		9/30/2018
Financial Information
Total revenues	$	362,443	$	312,445	$	287,330	$	274,004	$	323,538
Net income	$	64,451	$	45,116	$	37,127	$	10,672	$	51,715
Net Income attributable to Sun Communities Inc.	$	57,002	$	40,385	$	34,331	$	9,039	$	46,060
Basic earnings per share*	$	0.63	$	0.46	$	0.40	$	0.11	$	0.56
Diluted earnings per share*	$	0.63	$	0.46	$	0.40	$	0.11	$	0.56

Cash distributions declared per common share*	$	0.75	$	0.75	$	0.75	$	0.71	$	0.71

Recurring EBITDA ⁽¹⁾	$	179,953	$	151,502	$	147,714	$	133,335	$	158,129
FFO attributable to Sun Communities, Inc. common stockholders and dilutive convertible securities ^{(1) (7)}	$	119,496	$	108,112	$	106,779	$	88,562	$	117,018
Core FFO attributable to Sun Communities, Inc. common stockholders and dilutive convertible securities ^{(1) (7)}	$	137,369	$	108,002	$	106,259	$	92,695	$	116,959
FFO attributable to Sun Communities, Inc. common stockholders and dilutive convertible securities ^{(1) (7)}per share - fully diluted*	$	1.27	$	1.18	$	1.19	$	0.98	$	1.35
Core FFO attributable to Sun Communities, Inc. common stockholders and dilutive convertible securities ^{(1) (7)} per share - fully diluted*	$	1.46	$	1.18	$	1.18	$	1.03	$	1.35

Balance Sheet
Total assets	$	7,397,854	$	7,222,084	$	7,098,662	$	6,710,026	$	6,653,726
Total debt	$	3,271,341	$	3,107,775	$	3,448,117	$	3,124,303	$	3,004,929
Total liabilities	$	3,720,983	$	3,542,188	$	3,846,325	$	3,479,112	$	3,367,285



	Quarter Ended
	9/30/2019		6/30/2019		3/31/2019		12/31/2018		9/30/2018
Operating Information*
Communities	389		382		379		371		370

Manufactured home sites	88,024		87,555		87,425		84,428		84,033
Annual RV sites	25,756		25,009		24,750		24,535		24,109
Transient RV sites	20,882		20,585		20,173		19,491		19,432
Total sites	134,662		133,149		132,348		128,454		127,574

MH occupancy	95.7	%	95.7	%	95.4	%	95.0	%	94.9	%
RV occupancy	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%
Total blended MH and RV occupancy	96.7	%	96.6	%	96.4	%	96.1	%	96.1	%

New home sales	167		139		125		140		146
Pre-owned home sales	739		788		673		738		825
Total home sales	906		927		798		878		971



	Three Months Ended	Nine Months Ended
	September 30, 2019	September 30, 2019
Net Lease Sites ⁽²⁴⁾
MH net lease sites	296	1,104
RV net lease sites	470	901
Total net leased sites	766	2,005

3rd Quarter 2019 Supplemental Information 11 Sun Communities, Inc.

Debt Analysis

(amounts in thousands)



	Quarter Ended
	9/30/2019			6/30/2019			3/31/2019			12/31/2018			9/30/2018
Debt Outstanding
Mortgage loans payable	$	2,967,128		$	2,863,485		$	2,879,017		$	2,815,957		$	2,819,225
Secured borrowings on collateralized receivables ⁽⁴⁾	93,669			98,299			102,676			107,731			113,089
Preferred Equity - Sun NG Resorts - mandatorily redeemable	35,249			35,249			35,249			35,277			35,277
Preferred OP units - mandatorily redeemable	34,663			34,663			34,663			37,338			37,338
Lines of credit ⁽⁵⁾	140,632			76,079			396,512			128,000			—
Total debt	$	3,271,341		$	3,107,775		$	3,448,117		$	3,124,303		$	3,004,929

% Fixed / Floating
Fixed	95.7		%	97.6		%	88.5		%	95.9		%	100.0		%
Floating	4.3		%	2.4		%	11.5		%	4.1		%	—		%
Total	100.0		%	100.0		%	100.0		%	100.0		%	100.0		%

Weighted Average Interest Rates
Mortgage loans payable	4.13		%	4.24		%	4.24		%	4.22		%	4.23		%
Preferred Equity - Sun NG Resorts - mandatorily redeemable	6.00		%	6.00		%	6.00		%	6.00		%	6.00		%
Preferred OP units - mandatorily redeemable	6.50		%	6.50		%	6.50		%	6.61		%	6.61		%
Lines of credit ⁽⁵⁾	3.23		%	3.34		%	3.73		%	3.77		%	—		%
Average before Secured borrowings ⁽⁴⁾	4.14		%	4.27		%	4.22		%	4.25		%	4.28		%
Secured borrowings on collateralized receivables ⁽⁴⁾	9.92		%	9.93		%	9.94		%	9.94		%	9.95		%
Total average	4.30		%	4.44		%	4.39		%	4.45		%	4.40		%

Debt Ratios
Net Debt / Recurring EBITDA ⁽¹⁾ (TTM)	5.3			5.2			6.0			5.6			5.4
Net Debt / Enterprise Value	18.7		%	20.2		%	24.1		%	25.2		%	24.1		%
Net Debt / Gross Assets	36.0		%	35.1		%	39.8		%	37.7		%	35.9		%

Coverage Ratios
Recurring EBITDA ⁽¹⁾ (TTM) / Interest	4.4			4.2			4.1			4.0			3.9
Recurring EBITDA ⁽¹⁾ (TTM) / Interest + Pref. Distributions + Pref. Stock Distribution	4.2			4.0			3.9			3.9			3.8



Maturities / Principal Amortization Next Five Years	Remaining 2019			2020			2021			2022			2023
Mortgage loans payable
Maturities	$	—		$	58,078		$	270,680		$	82,155		$	185,618
Principal amortization	14,185			56,702			55,804			53,726			52,693
Secured borrowings on collateralized receivables ⁽⁴⁾	1,220			5,166			5,553			5,747			5,756
Preferred Equity - Sun NG Resorts - mandatorily redeemable	—			—			—			35,249			—
Lines of credit ⁽⁵⁾	—			3,632			—			—			137,000
Total	$	15,405		$	123,578		$	332,037		$	176,877		$	381,067

Weighted average rate of maturities	—		%	5.92		%	5.53		%	4.46		%	4.08		%

3rd Quarter 2019 Supplemental Information 12 Sun Communities, Inc.

Real Property Operations – Same Community⁽²⁾

(amounts in thousands except for Other Information)



	Three Months Ended									Nine Months Ended
	September 30, 2019		September 30, 2018		Change			% Change		September 30, 2019		September 30, 2018		Change			% Change
Financial Information
Income from real property⁽¹¹⁾	$	214,452	$	202,133	$	12,319		6.1	%	$	609,841	$	574,491	$	35,350		6.2	%

Property operating expenses
Payroll and benefits	20,418		19,244		1,174			6.1	%	55,512		52,387		3,125			6.0	%
Legal, taxes, and insurance	2,589		2,600		(11		)	(0.4	)%	6,911		7,118		(207		)	(2.9	)%
Utilities ⁽¹¹⁾	17,382		16,958		424			2.5	%	45,060		44,746		314			0.7	%
Supplies and repair ⁽¹²⁾	9,492		8,575		917			10.7	%	23,683		21,473		2,210			10.3	%
Other	5,670		6,013		(343		)	(5.7	)%	15,536		16,103		(567		)	(3.5	)%
Real estate taxes	14,607		14,110		497			3.5	%	44,093		41,772		2,321			5.6	%
Property operating expenses	70,158		67,500		2,658			3.9	%	190,795		183,599		7,196			3.9	%
Real Property NOI⁽¹⁾	$	144,294	$	134,633	$	9,661		7.2	%	$	419,046	$	390,892	$	28,154		7.2	%



	As of
	September 30, 2019			September 30, 2018			Change			% Change
Other Information
Number of properties	345

MH occupancy⁽³⁾	97.8		%
RV occupancy⁽³⁾	100.0		%
MH & RV blended occupancy⁽³⁾	98.3		%	96.2		%	2.1		%

Monthly base rent per site - MH	$	573		$	551		$	22		4.2	%	⁽¹⁴⁾
Monthly base rent per site - RV ⁽¹³⁾	$	475		$	448		$	27		6.1	%	⁽¹⁴⁾
Monthly base rent per site - Total ⁽¹³⁾	$	551		$	527		$	24		4.5	%	⁽¹⁴⁾

3rd Quarter 2019 Supplemental Information 13 Sun Communities, Inc.

Home Sales Summary

(amounts in thousands except for *)



	Three Months Ended											Nine Months Ended
	September 30, 2019			September 30, 2018			Change			% Change		September 30, 2019			September 30, 2018			Change			% Change
Financial Information
New homes
New home sales	$	19,775		$	16,433		$	3,342		20.3	%	$	51,860		$	42,978		$	8,882		20.7	%
New home cost of sales	16,761			14,278			2,483			17.4	%	44,740			37,187			7,553			20.3	%
NOI / Gross Profit ⁽¹⁾– new homes	3,014			2,155			859			39.9	%	7,120			5,791			1,329			22.9	%
Gross margin % – new homes	15.2		%	13.1		%	2.1		%			13.7		%	13.5		%	0.2		%
Average selling price – new homes*	$	118,413		$	112,555		$	5,858		5.2	%	$	120,325		$	111,342		$	8,983		8.1	%

Pre-owned homes
Pre-owned home sales	$	30,030		$	29,698		$	332		1.1	%	$	84,805		$	79,270		$	5,535		7.0	%
Pre-owned home cost of sales	19,557			19,414			143			0.7	%	55,290			54,008			1,282			2.4	%
NOI / Gross Profit ⁽¹⁾– pre-owned homes	10,473			10,284			189			1.8	%	29,515			25,262			4,253			16.8	%
Gross margin % – pre-owned homes	34.9		%	34.6		%	0.3		%			34.8		%	31.9		%	2.9		%
Average selling price – pre-owned homes*	$	40,636		$	35,998		$	4,638		12.9	%	$	38,548		$	33,518		$	5,030		15.0	%

Total home sales
Revenue from home sales	49,805			46,131			3,674			8.0	%	136,665			122,248			14,417			11.8	%
Cost of home sales	36,318			33,692			2,626			7.8	%	100,030			91,195			8,835			9.7	%
NOI / Gross Profit ⁽¹⁾– home sales	$	13,487		$	12,439		$	1,048		8.4	%	$	36,635		$	31,053		$	5,582		18.0	%

Statistical Information
New home sales volume*	167			146			21			14.4	%	431			386			45			11.7	%
Pre-owned home sales volume*	739			825			(86		)	(10.4	)%	2,200			2,365			(165		)	(7.0	)%
Total home sales volume *	906			971			(65		)	(6.7	)%	2,631			2,751			(120		)	(4.4	)%

3rd Quarter 2019 Supplemental Information 14 Sun Communities, Inc.

Rental Program Summary

(amounts in thousands except for *)



	Three Months Ended									Nine Months Ended
	September 30, 2019		September 30, 2018		Change			% Change		September 30, 2019		September 30, 2018		Change			% Change
Financial Information
Revenues
Rental home revenue	$	14,444	$	13,589	$	855		6.3	%	$	42,827	$	39,957	$	2,870		7.2	%
Site rent from Rental Program ^{(1) (10)}	17,270		16,397		873			5.3	%	51,326		49,245		2,081			4.2	%
Rental Program revenue	31,714		29,986		1,728			5.8	%	94,153		89,202		4,951			5.6	%

Expenses
Repairs and refurbishment	3,644		2,818		826			29.3	%	8,751		7,339		1,412			19.2	%
Taxes and insurance	1,940		1,593		347			21.8	%	5,631		4,708		923			19.6	%
Other	424		1,825		(1,401		)	(76.8	)%	1,505		4,731		(3,226		)	(68.2	)%
Rental Program operating and maintenance	6,008		6,236		(228		)	(3.7	)%	15,887		16,778		(891		)	(5.3	)%
Rental Program NOI ⁽¹⁾	$	25,706	$	23,750	$	1,956		8.2	%	$	78,266	$	72,424	$	5,842		8.1	%

Other Information
Number of sold rental homes*	317		316		1			0.3	%	859		825		34			4.1	%
Number of occupied rentals, end of period*										11,170		10,913		257			2.4	%
Investment in occupied rental homes, end of period										$	570,053	$	517,321	$	52,732		10.2	%
Weighted average monthly rental rate, end of period*										$	987	$	940	$	47		5.0	%

3rd Quarter 2019 Supplemental Information 15 Sun Communities, Inc.

Acquisitions and Other Summary ⁽¹⁵⁾

(amounts in thousands except for statistical data)



	Three Months Ended		Nine Months Ended
	September 30, 2019		September 30, 2019
Financial Information
Revenues
Income from real property	$	33,035	$	63,548

Property and operating expenses
Payroll and benefits	5,007		10,881
Legal, taxes & insurance	379		805
Utilities	3,066		6,490
Supplies and repairs	1,474		3,366
Other	4,682		8,736
Real estate taxes	792		2,362
Property operating expenses	15,400		32,640
Net operating income (NOI) ⁽¹⁾	$	17,635	$	30,908

			September 30, 2019
Other Information
Number of properties			44
Occupied sites			4,329
Developed sites			4,608
Occupancy %			93.9		%
Transient sites			6,515

3rd Quarter 2019 Supplemental Information 16 Sun Communities, Inc.



Property Summary
(includes MH and Annual RVs)

COMMUNITIES	9/30/2019		6/30/2019		3/31/2019		12/31/2018		9/30/2018
FLORIDA
Communities	125		125		125		124		124
Developed sites ⁽¹⁶⁾	39,067		38,879		38,878		37,874		37,879
Occupied ⁽¹⁶⁾	38,155		37,944		37,932		36,868		36,822
Occupancy % ⁽¹⁶⁾	97.7	%	97.6	%	97.6	%	97.3	%	97.2	%
Sites for development	1,633		1,638		1,685		1,684		1,494
MICHIGAN
Communities	72		72		72		70		70
Developed sites ⁽¹⁶⁾	27,906		27,891		27,777		26,504		26,116
Occupied ⁽¹⁶⁾	26,677		26,591		26,430		25,075		24,830
Occupancy % ⁽¹⁶⁾	95.6	%	95.3	%	95.2	%	94.6	%	95.1	%
Sites for development	1,115		1,115		1,202		1,202		1,533
TEXAS
Communities	23		23		23		23		23
Developed sites ⁽¹⁶⁾	7,098		6,997		6,953		6,922		6,905
Occupied ⁽¹⁶⁾	6,834		6,683		6,529		6,428		6,301
Occupancy % ⁽¹⁶⁾	96.3	%	95.5	%	93.9	%	92.9	%	91.3	%
Sites for development	1,086		1,100		1,107		1,121		907
CALIFORNIA
Communities	31		31		31		30		30
Developed sites ⁽¹⁶⁾	5,963		5,946		5,949		5,941		5,932
Occupied ⁽¹⁶⁾	5,917		5,896		5,902		5,897		5,881
Occupancy % ⁽¹⁶⁾	99.2	%	99.2	%	99.2	%	99.3	%	99.1	%
Sites for development	302		56		56		56		59
ARIZONA
Communities	13		13		13		12		11
Developed sites ⁽¹⁶⁾	4,239		4,235		4,238		3,836		3,826
Occupied ⁽¹⁶⁾	3,852		3,842		3,830		3,545		3,515
Occupancy % ⁽¹⁶⁾	90.9	%	90.7	%	90.4	%	92.4	%	91.9	%
Sites for development	—		—		—		—		—
ONTARIO, CANADA
Communities	15		15		15		15		15
Developed sites ⁽¹⁶⁾	4,022		3,929		3,832		3,845		3,832
Occupied ⁽¹⁶⁾	4,022		3,929		3,832		3,845		3,832
Occupancy % ⁽¹⁶⁾	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%
Sites for development	1,675		1,675		1,675		1,682		1,662
INDIANA
Communities	11		11		11		11		11
Developed sites ⁽¹⁶⁾	3,089		3,089		3,089		3,089		3,089
Occupied ⁽¹⁶⁾	2,870		2,849		2,823		2,772		2,778
Occupancy % ⁽¹⁶⁾	92.9	%	92.2	%	91.4	%	89.7	%	89.9	%
Sites for development	277		277		277		277		277
OHIO
Communities	9		9		9		9		9
Developed sites ⁽¹⁶⁾	2,770		2,770		2,770		2,770		2,770
Occupied ⁽¹⁶⁾	2,703		2,705		2,704		2,693		2,694
Occupancy % ⁽¹⁶⁾	97.6	%	97.7	%	97.6	%	97.2	%	97.3	%
Sites for development	59		59		59		59		59

3rd Quarter 2019 Supplemental Information 17 Sun Communities, Inc.



Property Summary
(includes MH and Annual RVs)

COMMUNITIES	9/30/2019			6/30/2019		3/31/2019		12/31/2018		9/30/2018
COLORADO
Communities	10			8		8		8		8
Developed sites ⁽¹⁶⁾	2,423			2,335		2,335		2,335		2,335
Occupied ⁽¹⁶⁾	2,325			2,323		2,323		2,320		2,313
Occupancy % ⁽¹⁶⁾	96.0	%		99.5	%	99.5	%	99.4	%	99.1	%
Sites for development	1,973			2,129		2,129		2,129		2,129
OTHER STATES
Communities	80			75		72		69		69
Developed sites ⁽¹⁶⁾	17,203			16,493		16,354		15,847		15,458
Occupied ⁽¹⁶⁾	16,657			16,026		15,826		15,323		14,932
Occupancy % ⁽¹⁶⁾	96.8	%		97.2	%	96.8	%	96.7	%	96.6	%
Sites for development	2,437			2,705		2,987		3,048		3,195
TOTAL - PORTFOLIO
Communities	389			382		379		371		370
Developed sites ⁽¹⁶⁾	113,780			112,564		112,175		108,963		108,142
Occupied ⁽¹⁶⁾	110,012			108,788		108,131		104,766		103,898
Occupancy % ⁽¹⁶⁾	96.7	%	⁽¹⁷⁾	96.6	%	96.4	%	96.1	%	96.1	%
Sites for development ⁽¹⁸⁾	10,557			10,754		11,177		11,258		11,315
% Communities age restricted	30.8	%		31.4	%	31.7	%	32.1	%	32.2	%

TRANSIENT RV PORTFOLIO SUMMARY
Location
Florida	5,506			5,693		5,650		5,917		5,786
California	1,970			1,985		1,975		1,765		1,774
Texas	1,642			1,693		1,717		1,752		1,758
Maryland	1,426			1,380		1,375		1,381		1,386
Arizona	1,421			1,424		1,421		1,423		1,057
Ontario, Canada	937			1,043		1,131		1,046		1,056
New York	924			935		929		925		910
New Jersey	868			875		906		884		893
Maine	821			848		857		572		578
Michigan	569			584		611		576		629
Utah	560			562		562		562		562
Indiana	519			519		519		519		519
Other states	3,719			3,044		2,520		2,169		2,524
Total transient RV sites	20,882			20,585		20,173		19,491		19,432

3rd Quarter 2019 Supplemental Information 18 Sun Communities, Inc.

Capital Improvements, Development, and Acquisitions

(amounts in thousands except for *)



	Recurring Capital Expenditures Average/Site*		Recurring Capital Expenditures ⁽¹⁹⁾		Lot Modifications ⁽²⁰⁾		Acquisitions ⁽²¹⁾		Expansion & Development ⁽²²⁾		Revenue Producing ⁽²³⁾
YTD 2019	$	192	$	16,922	$	22,163	$	497,123	$	203,940	$	8,159
2018	$	263	$	24,265	$	22,867	$	414,840	$	152,672	$	3,864
2017	$	214	$	14,166	$	18,049	$	204,375	$	88,331	$	1,990

3rd Quarter 2019 Supplemental Information 19 Sun Communities, Inc.

Operating Statistics for MH and Annual RVs



LOCATIONS	Resident Move-outs	Net Leased Sites ⁽²⁴⁾	New Home Sales	Pre-owned Home Sales	Brokered Re-sales
Florida	1,253	571	189	247	1,001
Michigan	401	365	49	1,056	135
Ontario, Canada	467	177	29	21	219
Texas	245	406	37	267	48
Arizona	62	43	32	9	125
Indiana	45	98	6	191	16
Ohio	71	10	—	106	8
California	63	20	22	6	55
Colorado	2	5	8	52	35
Other states	677	310	59	245	81
Nine Months Ended September 30, 2019	3,286	2,005	431	2,200	1,723



TOTAL FOR YEAR ENDED	Resident Move-outs	Net Leased Sites ⁽²⁴⁾	New Home Sales	Pre-owned Home Sales	Brokered Re-sales
2018	3,435	2,600	526	3,103	2,147
2017	2,739	2,406	362	2,920	2,006



PERCENTAGE TRENDS	Resident Move-outs		Resident Re-sales
2019 (TTM)	2.7	%	7.1	%
2018	2.4	%	7.2	%
2017	1.9	%	6.6	%

3rd Quarter 2019 Supplemental Information 20 Sun Communities, Inc.

Footnotes and Definitions

(1)

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, NOI, and EBITDA are appropriate measures given their wide use by and relevance to investors and analysts. Additionally, FFO, NOI, and EBITDA are commonly used in various ratios, pricing multiples, yields and returns and valuation calculations used to measure financial position, performance and value.


•	FFO, reflecting the assumption that real estate values rise or fall with market conditions, principally adjusts for the effects of generally accepted accounting principles (“GAAP”) depreciation and amortization of real estate assets.


•	NOI provides a measure of rental operations that does not factor in depreciation, amortization and non-property specific expenses such as general and administrative expenses.


•	EBITDA provides a further measure to evaluate ability to incur and service debt and to fund dividends and other cash needs.

FFO is defined by the National Association of Real Estate Investment Trusts (“NAREIT”) as GAAP net income (loss), 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. 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 period-over-period, reflects the impact to operations from trends in occupancy rates, rental rates, and operating costs, providing perspective not readily apparent from GAAP net income (loss). Management believes 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. The Company also uses FFO excluding certain gain and loss items that management considers unrelated to the operational and financial performance of our core business (“Core FFO”). The Company believes that Core FFO provides enhanced comparability for investor evaluations of period-over-period results.

The Company believes that GAAP net income (loss) is the most directly comparable measure to FFO. The principal limitation of FFO is that it does not replace GAAP net income (loss) as a performance measure or GAAP cash flow from operations as a liquidity measure. Because FFO excludes significant economic components of GAAP net income (loss) including depreciation and amortization, FFO should be used as a supplement to GAAP net income (loss) and not as an alternative to it. Further, 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 is calculated in accordance with the Company’s interpretation of standards established by NAREIT, which may not be comparable to FFO reported by other REITs that interpret the NAREIT definition differently.

NOI is derived from revenues minus property operating expenses and real estate taxes. NOI is a non-GAAP financial measure that the Company believes is helpful to investors as a supplemental 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 measure 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. Therefore, NOI is a measure of the operating performance of the properties of the Company rather than of the Company overall.

The Company believes that GAAP net income (loss) is the most directly comparable measure to NOI. NOI should not be considered to be an alternative to GAAP net income (loss) as an indication of the Company’s financial performance or GAAP cash flow from operating activities 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. Because of the inclusion of items such as interest, depreciation, and amortization, the use of GAAP net income (loss) as a performance measure is limited as these items may not accurately reflect the actual change in market value of a property, in the case of depreciation and in the case of interest, may not necessarily be linked to the operating performance of a real estate asset, as it is often incurred at a parent company level and not at a property level.

EBITDA as defined by NAREIT (referred to as “EBITDAre”) is calculated as GAAP net income (loss), plus interest expense, plus income tax expense, plus depreciation and amortization, plus or minus losses or gains on the disposition of depreciated property (including losses or gains on change of control), plus impairment write-downs of depreciated property and of investments in unconsolidated affiliates caused by a decrease in value of depreciated property in the affiliate, and adjustments to reflect the entity’s share of EBITDAre of unconsolidated affiliates. EBITDAre is a non-GAAP financial measure that the Company uses to evaluate its ability to incur and service debt, fund dividends and other cash needs and cover fixed costs. Investors utilize EBITDAre as a supplemental measure to evaluate and compare investment quality and enterprise value of REITs. The Company also uses EBITDAre excluding certain gain and loss items that management considers unrelated to measurement of the Company’s performance on a basis that is independent of capital structure (“Recurring EBITDA”).

3rd Quarter 2019 Supplemental Information 21 Sun Communities, Inc.

The Company believes that GAAP net income (loss) is the most directly comparable measure to EBITDAre. EBITDAre is not intended to be used as a measure of the Company’s cash generated by operations or its dividend-paying capacity, and should therefore not replace GAAP net income (loss) as an indication of the Company’s financial performance or GAAP cash flow from operating, investing and financing activities as measures of liquidity.

(2) Same Community results reflect constant currency for comparative purposes. Canadian currency figures in the prior comparative period have been translated at 2019 actual exchange rates.

(3) The Same Community occupancy percentage for 2019 is derived from 107,553 developed sites, of which 105,683 were occupied. The number of developed sites excludes RV transient sites and approximately 1,700 recently completed but vacant MH expansion sites. Without the adjustment for vacant expansion sites, the Same Community occupancy percentage is 95.9 percent for MH, 100.0 percent for RV, and 96.8 percent for the blended MH and RV. The MH and RV blended occupancy is derived from 109,172 developed sites, of which 105,683 were occupied. The Same Community occupancy percentage for 2018 has been adjusted to reflect incremental period-over-period growth from filled expansion sites and the conversion of transient RV sites to annual RV sites.

(4) This is a transferred asset transaction which has been classified as collateralized receivables and the cash received from this transaction has been classified as a secured borrowing. The interest income and interest expense accrue at the same rate and amount.

(5) Lines of credit includes the Company’s MH floor plan facility. The effective interest rate on the MH floor plan facility was 7.0 percent for all periods presented. However, the Company pays no interest if the floor plan balance is repaid within 60 days.

(6) Other income / (expense), net was as follows (in thousands):



	Three Months Ended						Nine Months Ended
	September 30, 2019			September 30, 2018			September 30, 2019			September 30, 2018
Foreign currency translation gain / (loss)	$	(3,121	)	$	1,547		$	(26	)	$	(2,640	)
Contingent liability remeasurement loss	(1,287		)	(97		)	(1,421		)	(285		)
Long term lease termination expense	—			(219		)	(42		)	(289		)
Other income / (expense), net	$	(4,408	)	$	1,231		$	(1,489	)	$	(3,214	)

(7) The effect of certain anti-dilutive convertible securities is excluded from these items.

(8) These costs represent the expenses incurred to bring recently acquired properties up to the Company’s operating standards, including items such as tree trimming and painting costs that do not meet the Company’s capitalization policy.

(9)

Core FFO⁽¹⁾ includes an adjustment of $(0.4) million and zero for the three and nine months ended September 30, 2019 and $0.3 million and $1.0 million for the three and nine months ended September 30, 2018 for estimated loss of earnings in excess of the applicable business interruption deductible in relation to our Florida Keys communities that require redevelopment due to damages sustained from Hurricane Irma in September 2017, as previously announced. Amounts recognized in 2018 were received in 2019.

(10) The renter’s monthly payment includes the site rent and an amount attributable to the home lease. The site rent is reflected in Real Property Operations’ segment revenue. For purposes of management analysis, site rent is included in Rental Program revenue to evaluate the incremental revenue gains associated with the Rental Program, and to assess the overall growth and performance of the Rental Program and financial impact on the Company’s operations.

(11) Same Community results net $8.9 million and $8.5 million of utility revenue against the related utility expense in property operating and maintenance expense for the quarter ended September 30, 2019 and 2018, respectively. Same Community results net $25.8 million and $24.5 million of utility revenue against the related utility expense in property operating and maintenance expense for the nine months ended September 30, 2019 and 2018, respectively. Additionally, the Company adopted ASC 842, the new leasing standard, as of January 1, 2019 which required the reclassification of bad debt expense from Property operating expense to Income from real property. To assist with comparability within Same Community results, bad debt expense has been reclassified to be shown as a reduction of Income from real property for all periods presented.

(12) Same Community supplies and repair expense excludes $0.3 million and $1.8 million for the three and nine months ended September 30, 2018, respectively, of expenses incurred for recently acquired properties to bring the properties up to the Company’s operating standards, including items such as tree trimming and painting costs that do not meet the Company’s capitalization policy.

(13) Monthly base rent per site pertains to annual RV sites and excludes transient RV sites.

(14) Calculated using actual results without rounding.

3rd Quarter 2019 Supplemental Information 22 Sun Communities, Inc.

(15) Acquisitions and other is comprised of eleven properties acquired, one property being operated under a temporary use permit, and two properties that we have an interest in, but do not operate in 2019, twenty properties acquired in 2018, three Florida Keys properties that require redevelopment as a result of damage sustained from Hurricane Irma in 2017, five recently opened ground-up development properties, one property undergoing redevelopment, three properties that we have an interest in, but do not operate, and other miscellaneous transactions and activity.

(16) Includes MH and annual RV sites, and excludes transient RV sites, as applicable.

(17) As of September 30, 2019, total portfolio MH occupancy was 95.7 percent inclusive of the impact of approximately 1,700 recently constructed but vacant MH expansion sites, and annual RV occupancy was 100.0 percent.

(18) Total sites for development were comprised of approximately 74.2 percent for expansion, 19.8 percent for greenfield development and 6.0 percent for redevelopment.

(19) Recurring capital expenditures are necessary to maintain asset quality, including purchasing and replacing assets used to operate the community. These capital expenditures include items such as: major road, driveway, pool improvements; clubhouse renovations; adding or replacing street lights; playground equipment; signage; maintenance facilities; manager housing and property vehicles. The minimum capitalized amount is five hundred dollars.

(20) Lot modification capital expenditures improve the asset quality of the community. These costs are incurred when an existing older home moves out, and the site is prepared for a new home, more often than not, a multi-sectional home. These activities, which are mandated by strict manufacturer’s installation requirements and state building code, include items such as new foundations, driveways, and utility upgrades.

(21) Capital expenditures related to acquisitions represent the purchase price of existing operating communities and land parcels to develop expansions or new communities. These costs for the nine months ended September 30, 2019 include $36.6 million of capital improvements identified during due diligence that are necessary to bring the communities to the Company’s operating standards. For the years ended December 31, 2018 and 2017, these costs were $94.6 million and $84.0 million, respectively. These include items such as: upgrading clubhouses; landscaping; new street light systems; new mail delivery systems; pool renovation including larger decks, heaters, and furniture; new maintenance facilities; and new signage including main signs and internal road signs. These are considered acquisition costs and although identified during due diligence, often require 24 to 36 months after closing to complete.

(22) Expansion and development expenditures consist primarily of construction costs and costs necessary to complete home site improvements, such as driveways, sidewalks and landscaping.

(23) Capital costs related to revenue generating activities consist primarily of garages, sheds, sub-metering of water, sewer and electricity. Revenue generating attractions at our RV resorts are also included here and, occasionally, a special capital project requested by residents and accompanied by an extra rental increase will be classified as revenue producing.

(24) Net leased sites do not include occupied sites acquired during that year.

Certain financial information has been revised to reflect reclassifications in prior periods to conform to current period presentation.

3rd Quarter 2019 Supplemental Information 23 Sun Communities, Inc.