EDGAR 10-K Filing

Company CIK: 912593
Filing Year: 2022
Filename: 912593_10-K_2022_0000912593-22-000039.json

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ITEM 1. BUSINESS
ITEM 1. BUSINESS
GENERAL OVERVIEW
Sun Communities, Inc., a Maryland corporation, and all wholly-owned or majority-owned and controlled subsidiaries, including Sun Communities Operating Limited Partnership, a Michigan limited partnership (the "Operating Partnership"), Sun Home Services, Inc., a Michigan corporation ("SHS") and Safe Harbor Marinas, LLC ("Safe Harbor") are referred to herein as the "Company," "us," "we," and "our."
We are a fully integrated real estate investment trust ("REIT"). We own manufactured housing ("MH") communities and recreational vehicle ("RV") resorts throughout the United States and in Ontario, Canada. We self-administer, self-manage, and operate or hold an interest in, and develop the majority of our MH communities and RV resorts. A select number of our communities and resorts are operated by independent third party contractors on our behalf under a management agreement. Others are operated by a lessee under a ground lease arrangement. Through Safe Harbor, we own, operate, develop and manage marinas throughout the United States ("U.S.") and Puerto Rico, with the majority of such marinas concentrated in coastal regions and others located in various inland regions. We are a fully-integrated real estate company which, together with our affiliates and predecessors, has been in the business of acquiring, operating, developing and expanding MH communities and RV resorts since 1975 and marinas since 2020. We lease individual parcels of land, or sites, with utility access for the placement of manufactured homes and RVs to our MH and RV customers. Our MH communities are designed to offer affordable housing to individuals and families, while also providing certain amenities. Our RV resorts are designed to offer affordable vacation opportunities to individuals and families complemented by a diverse selection of high-quality amenities. Our marina offerings include wet slip and dry storage space leases, end-to-end service (such as routine maintenance, repair and winterization), fuel sales and other high-end amenities. These services and amenities offer convenience and resort-quality experiences.
As of December 31, 2021, we owned and operated, directly or indirectly, or had an interest in, a portfolio of 602 MH communities, RV resorts and marinas (collectively, the "properties") located in 39 states, Ontario, Canada and Puerto Rico, including 284 MH communities, 160 RV resorts, 33 properties containing both MH and RV sites, and 125 marinas. As of December 31, 2021, the properties contained an aggregate of 204,163 developed sites comprised of 98,621 developed MH sites, 30,540 annual RV sites (inclusive of both annual and seasonal usage rights), 29,847 transient RV sites, and 45,155 wet slips and dry storage spaces. Additionally, there are nearly 11,000 additional MH and RV sites suitable for development.
We are engaged through SHS, a taxable REIT subsidiary, in the marketing, selling, and leasing of new and pre-owned homes to current and future residents in our communities. The operations of SHS support and enhance our occupancy levels, property performance and cash flows.
Our executive and principal property management office is located at 27777 Franklin Road, Suite 200, Southfield, Michigan 48034 and our telephone number is (248) 208-2500. Our Safe Harbor marina segment principal office is located in Dallas, Texas. We have regional property management offices throughout the United States. We employed an aggregate of 5,961 full and part time employees as of December 31, 2021.
Our website address is www.suncommunities.com and we make available, free of charge, on or through our website all of our periodic reports, including our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, and current reports on Form 8-K, as soon as reasonably practicable after we file such reports with the Securities and Exchange Commission (the "SEC"). Additionally, the SEC maintains a website at https://www.sec.gov, that contains reports, proxy information statements and other information about Sun.
SUN COMMUNITIES, INC.
STRUCTURE OF THE COMPANY
The Operating Partnership is structured as an umbrella partnership REIT, or UPREIT. We conduct substantially all of our operations through the Operating Partnership. The Operating Partnership owns, either directly or indirectly through other subsidiaries, substantially all of our assets. This UPREIT structure enables us to comply with certain complex requirements under the federal tax rules and regulations applicable to REITs, and to acquire MH communities, RV resorts and marinas in transactions that defer some or all of the sellers' tax consequences. The financial results of the Operating Partnership and our other subsidiaries are consolidated in our Consolidated Financial Statements. The financial results include certain activities that do not necessarily qualify as REIT activities under the Internal Revenue Code of 1986, as amended (the "Code"). We have formed taxable REIT subsidiaries, as defined in the Code, to engage in such activities. We use taxable REIT subsidiaries to offer certain services to our residents and engage in activities that would not otherwise be permitted under the REIT rules if provided directly by us or by the Operating Partnership. The taxable REIT subsidiaries include our home sales business, SHS, which provides manufactured home sales, leasing, and other services to current and prospective tenants of our properties.
Under the partnership agreement, the Operating Partnership is structured to make distributions with respect to certain of the Operating Partnership units ("OP units") at the same time that distributions are made to our common stockholders. The Operating Partnership is structured to permit limited partners holding certain classes or series of OP units to exchange those OP units for shares of our common stock (in a taxable transaction) and achieve liquidity for their investment.
As the sole general partner of the Operating Partnership, we generally have the power to manage and have complete control over the conduct of the Operating Partnership's affairs and all decisions or actions made or taken by us as the general partner pursuant to the partnership agreement are generally binding upon all of the partners and the Operating Partnership.
SUN COMMUNITIES, INC.
We do not own all of the OP units. The following table sets forth:
•The various series of OP units and the number of units of each series outstanding as of December 31, 2021;
•The relative ranking of the various series of OP units with respect to rights to the payment of distributions and the distribution of assets in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Operating Partnership;
•The number of shares of our common stock issuable upon the exchange of each OP unit of the applicable series;
•The annual distribution rate on each series of OP Units; and
•Information regarding the terms of redemption rights for each series of OP units, as applicable.
Ranking Description OP Units Outstanding at December 31, 2021
Exchange Rate(1)
Annual Distribution Rate(2)
Cash Redemption(3)
Redemption Period
1 Preferred OP units (or "Aspen preferred OP units") 1,283,819(4)
Variable(5)
Variable(6)
Mandatory Variable(7)
1 Series A-1 preferred OP units 275,024 2.439 6.0 % N/A N/A
2 Series C preferred OP units 306,163 1.11 Variable(8)
N/A N/A
3 Series D preferred OP units 488,958 0.8 Variable(9)
Holder's Option Any time after earlier of January 31, 2024 or death of holder
4 Series E preferred OP units 90,000 0.6897 Variable(10)
N/A N/A
5 Series F preferred OP units 90,000 0.625 3.0 % Holder's Option Any time after earlier of May 14, 2025 or death of holder
6 Series G preferred OP units 240,710 0.6452 3.2 % Holder's Option Any time after earlier of September 30, 2025 or death of holder
7 Series H preferred OP units 581,407 0.6098 3.0 % Holder's Option Any time after earlier of October 30, 2025 or death of holder
8 Series I preferred OP units 922,000 0.6098 3.0 % Holder's Option Any time after earlier of December 31, 2025 or death of holder
9 Series J preferred OP units 240,000 0.6061 2.85 % Holder's Option During the 30-day period following a change of control of the Company or any time after April 21, 2026.
10 Series A-3 preferred OP units 40,268 1.8605 4.5 % N/A N/A
11 Common OP units 118,514,363(11)
1.0 Same distribution rate for common stock and common OP units N/A N/A
(1) Exchange rates are subject to adjustment upon stock splits, recapitalizations and similar events. The exchange rates of certain series of OP units are approximated to four decimal places.
(2) Except for common OP units, distributions are payable on the issue price of each OP unit, which is $27.00 per unit for all Aspen preferred OP units and $100.00 per unit for all other preferred OP units.
(3) The redemption price for each OP unit redeemed will be equal to its issue price plus all accrued but unpaid distributions.
(4) Of the outstanding Aspen preferred OP units, 270,000 are designated as "Aspen 2034 Units."
(5) At any time prior to January 1, 2024 (or prior to January 1, 2034 with respect to the Aspen 2034 Units), at the holder's option, each Aspen preferred OP unit may be exchanged into: (a) if the average closing price of our common stock for the preceding ten trading days is $68.00 per share or less, 0.397 common OP units, or (b) if the average closing price of our common stock for the preceding ten trading days is greater than $68.00 per share, the number of common OP units determined by dividing (i) the sum of (A) $27.00 plus (B) 25 percent of the amount by which the average closing price of our common stock for the preceding ten trading days exceeds $68.00 per share, by (ii) the average closing price of our common stock for the preceding ten trading days.
(6) The annual distribution rate for Aspen 2034 Units is 3.8 percent. The annual distribution rate on all other Aspen preferred OP units is equal to the 10-year U.S. Treasury bond yield plus 239 basis points; provided, however, that such aggregate distribution rate shall not be less than 6.5 percent nor more than 9.0 percent.
(7) We are required to redeem all outstanding Aspen preferred OP units other than the Aspen 2034 Units on January 2, 2024. We are required to redeem all outstanding Aspen 2034 Units on January 2, 2034. In addition, we are required to redeem the Aspen preferred OP units (including Aspen 2034 Units) of any holder thereof within five days after receipt of a written demand during the existence of certain uncured Aspen preferred OP unit defaults, including our failure to pay distributions on the Aspen preferred OP units when due and our failure to provide certain security for the payment of distributions on the Aspen preferred OP units.
(8) 4.5 percent until April 1, 2020 and 5.0 percent thereafter.
(9) 3.75 percent until January 31, 2021 and 4.0 percent thereafter.
(10) 5.25 percent until January 9, 2022 and 5.5 percent thereafter.
(11) Of the 118,514,363 common OP units, 115,976,408, or 97.9 percent were held by us, and 2,537,955, or 2.1 percent were owned by the limited partners.
SUN COMMUNITIES, INC.
REAL PROPERTY OPERATIONS
MH communities and RV resorts
An MH community is a residential subdivision with sites for the placement of manufactured homes, related improvements and amenities. Manufactured homes are detached single-family homes which are produced off-site by manufacturers and installed on site within the community. Manufactured homes are available in a wide array of designs, providing owners with a level of customization generally unavailable in multi-family housing developments. Modern MH communities contain improvements similar to other garden-style residential developments, including centralized entrances, paved streets, curbs, gutters and parkways. In addition, these communities also often provide a number of amenities, such as a clubhouse, a swimming pool, basketball courts, shuffleboard courts, tennis courts and laundry facilities.
An RV resort is a resort with sites for the placement of RVs for varied lengths of time. RV resorts may also provide vacation rental homes and may include a number of amenities such as restaurants, golf courses, swimming pools, water parks, tennis courts, fitness centers, planned activities and spacious social facilities.
Renters at our MH and RV properties lease the site on which a manufactured home, RV or vacation rental home is located. We typically own the underlying land, utility connections, streets, lighting, driveways, common area amenities, and other capital improvements and are responsible for enforcement of community guidelines and maintenance. In certain MH and RV properties, we do not own all of the underlying land and operate the communities pursuant to ground leases. Certain of the properties provide water and sewer service through public or private utilities companies, while others provide these services to residents from on-site facilities. Each owner of a home within our properties is responsible for the maintenance of the home and leased site. As a result, our capital expenditure needs tend to be less significant relative to multi-family rental apartment complexes.
In 2021, we began to rebrand certain of our RV resorts under the "Sun Outdoors" umbrella. Sun Outdoors offers tent camping, RV sites and vacation rentals with world-class amenities throughout the U.S. and in Ontario, Canada. We believe this rebranding under the Sun Outdoors umbrella will allow us to gain a competitive advantage in the outdoor recreation market. We are in the process of implementing the Sun Outdoors brand at certain of our RV resorts and expect implementation to be substantially completed by the end of 2022. Implementation consists of conversion of digital presence (Website, Facebook, Rezplot reservation software and other internal systems) and signage replacement at the resorts.
We compete with other available MH communities and RV resorts, and alternative forms of housing (such as on-site constructed homes, apartments, condominiums and townhouses) as they provide housing alternatives to potential tenants of MH communities and RV resorts.
Marina
A marina is a specially-designed harbor that can be located on oceans, lakes, bays or rivers and typically includes dry storage systems that provide storage solutions for the placement of vessels ranging in size from small boats to super yachts for varied lengths of time. Dry storage systems also allow for the required maintenance to the vessels that we store. Marinas also provide ancillary services, such as fuel stations, ship stores, restaurants, swimming pools, cabin and lodging rentals, boat rentals, tennis courts, fitness centers, shower and laundry facilities, planned activities and other services to create a robust member experience.
Renters at our marinas lease the wet slip or dry storage space on which the vessel is stored. We typically own the underlying land, building improvements, dock improvements, site improvements and other on-site amenity structures. Because we own the facilities and improvements on the land or submerged land at those marinas, we are responsible for the capital improvements and maintenance. In certain marinas, we do not own all of the underlying land and operate the marinas pursuant to ground leases.
We compete with other available marinas in the U.S. and Puerto Rico.
PROPERTY MANAGEMENT
Our property management strategy emphasizes intensive, detail-oriented, hands-on management by dedicated, on-site community, resort and marina managers. We believe our focus on creating an exceptional resident, guest and member experience creates a competitive advantage. It enables us to continually monitor and address concerns, the performance of competitive properties and local market conditions. As of December 31, 2021, of our 5,961 employees, 4,145 were located on-site as property managers, support staff or maintenance personnel, and of those, approximately 83.0 percent were full-time employees.
SUN COMMUNITIES, INC.
Our MH and RV property managers are overseen by John B. McLaren, our President and Chief Operating Officer, who has been in the MH industry since 1995, Bruce Thelen, our Executive Vice President of Operations and Sales, who has led our manufactured home sales and leasing subsidiary, SHS, since January 2018, three Senior Vice Presidents of Operations and Sales, 11 Divisional Vice Presidents and 45 Regional Vice Presidents. Each Regional Vice President oversees one to 16 properties and is responsible for regular property inspections, oversight of property operations and sales functions, semi-annual market surveys of competitive communities and interaction with local manufactured home dealers.
Each property manager performs regular inspections in order to monitor the physical condition of properties and to effectively address tenant concerns. In addition to an on-site manager, each district or property has on-site maintenance personnel and management support staff. We hold mandatory training sessions for all new property management personnel to ensure that policies and procedures are executed effectively and professionally. All of our property management personnel participate in on-going training to ensure that changes to policies and procedures are implemented consistently. Our internal training program has led to increased knowledge and accountability for daily operations and policies and procedures.
Our marina business is overseen by Baxter Underwood, the Chief Executive Officer of Safe Harbor, who has been in the marina business since 2006, two Chief Operating Officers and 17 Regional Vice Presidents who are responsible for regular marina inspections and oversight of operations.
HOME SALES AND RENTALS
SHS is engaged in the marketing, selling and leasing of new and pre-owned homes to residents in our communities. Because tenants often purchase a home already on-site within a community, such services enhance occupancy and property performance. Additionally, because many of the homes on the properties are sold through SHS, better control of home quality in our communities can be maintained than if sales services were conducted solely through third-party brokers.
SHS also leases homes to prospective tenants. At December 31, 2021, SHS had 9,870 occupied leased homes in its portfolio. New and pre-owned homes are purchased for the Rental Program. Leases associated with the Rental Program generally have a term of one year. The Rental Program requires management of costs associated with repair and refurbishment of these homes as the tenants vacate and the homes are re-leased, similar to apartment rentals. We received approximately 55,500 applications during 2021 to live in our MH and RV properties, providing a significant "resident onboarding" system that allows us to market the purchase of a home to qualified applicants. Through the Rental Program we demonstrate our product and lifestyle to the renters, while monitoring their payment history and converting qualified renters to owners.
Our home sales and leasing operations compete with other local and national MH dealers and MH community owners.
MARINA MEMBER BASE
We are engaged in the marketing and leasing of wet slips and dry storage spaces and have approximately 45,000 members throughout our marina network as of December 31, 2021.
SITE LEASES OR USAGE RIGHTS
Typical tenant leases for MH sites are year-to-year or month-to-month, renewable upon the consent of both parties, or, in some instances, as provided by statute. Certain of our leases, mainly at our Florida and California properties, are tied to the consumer price index or other indices as they relate to rent increases. Generally, market rate adjustments are made on an annual basis. These leases are cancellable for non-payment of rent, violation of community rules and regulations or other specified defaults. During the five calendar years ended December 31, 2021, on average less than 1.0 percent of the homes in our MH communities have been removed by their owners and 6.5 percent of the homes have been sold by their owners to a new owner who then assumes rental obligations as a community resident. The average cost to move a home is approximately $7,000. On average, our residents remain in our communities for approximately 14 years.
Typical resident agreements for RV sites are year-to-year or from move-in date until the end of the current calendar year. Generally, increases and market rate adjustments are made on an annual basis. These agreements are cancellable for non-payment of rent, violation of resort rules and regulations or other specified defaults.
Leases for wet slips and dry storage spaces at our marinas are year-to-year, season-to-season, month-to-month, or transient by night, renewable upon the consent of both parties. On average, our members maintain leases in our marinas for approximately eight years.
SUN COMMUNITIES, INC.
ACQUISITIONS
During the year ended December 31, 2021, we acquired 35 MH communities and RV resorts, totaling 9,277 sites and 19 marinas totaling 6,539 wet slips and dry storage spaces for a total purchase price of approximately $1.4 billion.
On November 13, 2021, we entered into an agreement to acquire Tiger Topco 1 Limited (together with its subsidiaries, "Park Holidays"), an owner and operator of holiday communities in the United Kingdom. The transaction values Park Holidays at an enterprise value of £950 million (or approximately $1.3 billion). We anticipate that the acquisition of Park Holidays will close within the three months ending March 31, 2022. However, the closing is subject to the approval of the UK Financial Conduct Authority, which regulates certain loan brokering activities of Park Holidays.
We are also currently pursuing additional significant acquisition opportunities outside the United States, including in the United Kingdom and Europe.
EXPANSION / DEVELOPMENT
During the year ended December 31, 2021, we completed the construction of over 1,030 sites in eight ground-up developments and re-developments, and nearly 580 expansion sites in six MH communities and five RV resorts.
REGULATIONS AND INSURANCE
General
MH, RV and marina properties are subject to various laws, ordinances and regulations, including regulations relating to recreational facilities such as swimming pools, clubhouses and other common areas. Each property has the necessary operating permits and approvals.
Insurance
Our management believes that the properties are covered by adequate fire, property, business interruption, general liability, and (where appropriate) flood and earthquake insurance provided by reputable companies with commercially reasonable deductibles and limits. We maintain a blanket policy that covers all of our properties. We have obtained title insurance insuring fee title to the properties in an aggregate amount which we believe to be adequate. Claims made to our insurance carriers that are determined to be recoverable are classified in other receivables as incurred.
HUMAN CAPITAL
Human capital management is key to our success and focuses on diversity, equity and inclusion, employee retention and talent development practices. We are committed to building an equitable and inclusive culture that inspires and supports the growth of our employees, serves our communities and shapes a more sustainable business. The most significant measures and objectives that we focus on in managing our business and our related human capital initiatives include the following:
CULTURE
We are taking deliberate actions to foster a growth culture that is grounded in our vision and culture statements: We are an inspired, engaged and collaborative team committed to providing extraordinary service to our residents, customers and team members. Together as one team, we embrace the following seven key behaviors that make our company a great place to work:
•Live the Golden Rule: Treat others the way you want to be treated;
•Do the right thing;
•We over me;
•Nothing changes if nothing changes;
•Mindset is everything;
•Keep it simple; and
•Be yourself and thrive.
SUN COMMUNITIES, INC.
LEADERSHIP, TALENT, TRAINING AND DEVELOPMENT
We expect our leaders to be role models and lead in a way that enables our organization to achieve success. Our strategy is anchored in promoting the right internal talent and hiring the right external talent for career opportunities across our organization. We are focused on hiring and developing talent that mirrors the markets we serve, and investing in learning opportunities and capabilities that equip our workforce with the skills they need while improving engagement and retention.
•Our internal training program, Sun University, offers over 100 courses to our MH and RV team members on a range of topics, including leadership, communications, inclusion and diversity, software and operations. Our internal training program has led to increased knowledge and accountability for daily operations and policies and procedures. In 2021, team members logged 52,506 learning hours;
•We hold mandatory ongoing training sessions for all property management personnel to ensure that policies and procedures are executed effectively, professionally and consistently; and
•New team members are required to complete information security training, and safety and compliance-related training, with routine refreshers at least annually on critical topics.
We are dedicated to the attraction, development and retention of our talent, focusing our efforts on ensuring that the returning seasonal team member pipeline remains robust each year and our annual talent management processes focus on the professional development of salaried team members. As of December 31, 2021, nearly 10 percent of our employees had over 10 years tenure.
Our compensation philosophy, aimed to apply merit-based, equitable compensation practices, is designed to attract and retain top talent. For eligible team members, we offer competitive salary, health, welfare, retirement and pet insurance benefits, tuition reimbursement and rent / vacation discounts at our properties.
DIVERSITY, EQUITY AND INCLUSION ("DEI")
We make it a priority to recognize and appreciate the diverse characteristics that make individuals unique in an atmosphere that promotes and celebrates individual and collective achievement. We believe it's not just about gender or race, but about being diverse in thoughts, life and work experiences. Our inclusive environment challenges, inspires, rewards, and transforms our team to be the best. We do not tolerate harassing, discriminatory, or retaliatory conduct as such conduct is prohibited and inconsistent with our policies, practices and philosophy. We continue to put our resources and energy into strategies and initiatives to create a more equitable environment.
Workforce Diversity
We believe we are a stronger organization when our workforce represents a diversity of ideas and experiences. We value and embrace diversity in our employee recruiting, hiring and development practices. As of December 31, 2021, 41 percent of our employees were female, 21 percent of our employees were racially or ethnically diverse, and 47 percent of our employees were aged 50 years and older, with approximately 24 percent being aged 60 years and older.
Training and Resources
We offer trainings and resources on diversity, equity and inclusion to our employees. Diversity education and training programs for our team focus on unconscious bias, gender identity and transitions, generational differences, religion in the workplace, and self-awareness and self-assessments.
•We launched our formal initiative for Inclusion, Diversity, Equity and Accountability ("IDEA") focused on enhancing diversity through education, awareness and outreach throughout our company, communities and resorts;
•We engaged a third-party DEI consultant who conducted a company-wide training on DEI-related key foundational terms and helped develop an organization-wide IDEA strategy for Sun; and
•We set the foundation with senior leaders at our 2021 Elevate conference where we held break out sessions on allyship with inclusion and belonging, continuing the IDEA conversation, inclusive leadership, introduction to IDEA, and workplace microaggressions and unconscious bias.
SUN COMMUNITIES, INC.
In order to implement and sustain this initiative, in 2021:
•We created our IDEA council to help implement Sun's IDEA Strategy;
•Our Chief Executive Officer signed a pledge for the CEO Action for Diversity & Inclusion, a commitment to advance diversity and inclusion within the workplace;
•We made Juneteenth an annual company holiday to celebrate the end of slavery in the United States;
•We launched an anti-racism resource center for employees inclusive of videos, podcasts, articles, books, films and television series; and
•We implemented "Job Analyzer" in our applicant tracking system to proactively identify and address gender bias in job postings.
EQUITY PAY
We are committed to providing a total compensation package that is market-based, performance driven, fair and internally equitable. Our goal is to be competitive both within the general employment market as well as with our competitors in the real estate industry, with our strongest performers being paid more.
•Compensation for each position is determined by utilizing reliable third-party compensation surveys to obtain current market data. Additionally, position descriptions and compensation are routinely reviewed for market competitiveness.
•On an annual basis, the performance of all team members is evaluated and merit increases are allocated based on performance. This process ensures equitable performance review and corresponding pay practices that attract, retain, and reward top talent.
•In 2021, we conducted an analysis on data related to open positions, retention, market compensation pay gaps, and internal equity, and remediated any identified pay gaps. A total of 3,300 team members received some level of pay increase apart from their normal merit-based increase.
BUSINESS INTEGRITY
Our Code of Conduct and Business Ethics is grounded in our commitment to do the right thing. It serves as the foundation of our approach to ethics and compliance, and our anti-corruption compliance program is focused on conducting business in a fair, ethical and legal manner.
WORKPLACE HEALTH AND SAFETY
Sun actively seeks opportunities to minimize health, safety and environmental risks to our team members, residents, and guests we serve in our communities and resorts by utilizing safe operating procedures and practices:
•As part of our commitment to safety, Sun oversees annual safety training programs for all employees to provide tools and safeguards for accident prevention. Our managers are responsible for ensuring that team members receive the appropriate training to perform their jobs safely;
•All team members participate in safety training during the onboarding process, and thereafter, team members in the field complete an annual safety training course;
•We work hard to uphold a safe workplace by complying with safety and health laws and regulations, maintaining internal requirements and remediating risks. Each community is regularly inspected to ensure safety standards are being met, with comprehensive safety inspections completed annually; and
•Our COVID-19 Response and Action Plan, described below, continues to serve as a guideline for the safe operation of our communities, resorts and main office.
SUN COMMUNITIES, INC.
ENVIRONMENTAL, SOCIAL AND GOVERNANCE ("ESG")
We uphold a company-wide commitment to ESG goals through various programs and everyday business practices. We are fully committed to reducing our environmental impact across the scope of our operations and through the services we deliver to our residents and guests. We continue to identify opportunities to invest in energy-efficient technology, water efficiency and waste reduction strategies throughout our communities, resorts and corporate headquarters. By conserving natural resources, reducing our carbon footprint and participating in efforts to protect the environment through our Sun Unity program, we are striving to achieve our environmental sustainability goals.
We recognize the important opportunity of providing access to affordable and sustainable housing. Our business contributes to a vitally important function in our economy by providing high-quality, yet affordable, housing for both all-age and age-restricted needs. Manufactured homes cost approximately 52 percent less per square foot than conventional site-built homes, expanding the opportunity for residents to own their home, despite an ever-increasing housing affordability gap. Our homes provide more space at less cost per square foot compared to other options.
As a nationwide provider of affordable housing, and a leader in the marina business, we believe we have a responsibility not only to our residents, guests and team members, but also to the communities in which we live and work. These social responsibility efforts are initiated through our Sun Unity program, so we can join together as a team and give back to these communities to achieve goals like promotion, education and waste reduction.
COVID-19 RELIEF AND SUPPORT
The health and safety of our residents, guests and team members is our top priority. In 2020, at the height of the COVID-19 pandemic, we instituted our COVID-19 Response and Action Plan which established guidelines for safe operations of our communities, resorts and our main office. We continue to revise our guidelines to be in line with revised government and regulatory mandates. Content contained within this plan includes:
•Methods for preventing and reducing exposure and transmission of COVID-19 among individuals;
•Methods for identification and isolation of sick persons;
•Operational protocols for social distancing, including reduced occupancy requirements;
•Sanitation policies and procedures, including cleaning, disinfecting and decontamination;
•Communications and training for team members and leaders that are necessary to implement the plan; and
•Procedures to ensure effective ongoing implementation of the plan.
Temporary relief measures extended to residents and guests include:
•Enhanced cleaning procedures, as well as additional signage, and changes to policies and procedures further promoting social distancing.
•Amenity kits are being provided to guests upon check-in which include hand sanitizer, face masks and sanitation wipes.
•Contactless processes are put in place for rent collection, lease renewals, reservations and guest check-ins.
•Large quantities of personal protection equipment and cleaning products are distributed to all of Sun's locations.
While COVID-19 had a material effect on our employees, residents and guests during 2021, it did not materially impact our financial performance.
SUN COMMUNITIES, INC.
COMMITMENT TO A SUSTAINABLE FUTURE
While the pandemic has been the defining issue of the last two years, climate change is the challenge of our lifetime. Climate change poses a clear threat and challenge to the real estate sector, as buildings contribute up to 30 percent of global annual greenhouse gas (“GHG”) emissions. Climate change impacts are material to our overall value as well as our ability to serve our residents, guests, employees, investors and other stakeholders. We are committed to reducing our GHG emissions and working to improve upon the environmental performance of the communities and properties within our portfolio. We are at the very beginning of this process with a focus on expanding our climate analysis to be more comprehensive and integrated into our overall business strategy. Some of our accomplishments include:
Climate Risk Assessment - In 2021, we performed an analysis of the climate risk impact on our properties. Various models were used to determine risks related to the sea-level rise, flooding, wildfire, water scarcity, cold waves and heat waves across three timeframes (2020, 2030 and 2050). We reviewed the results of this assessment and are using them to develop our risk mitigation and resilience (climate change adaptation) strategies. We are now integrating a climate risk analysis in the due diligence process during acquisitions of properties.
Greenhouse Gas Emissions - We created a framework to track the GHG emissions across our portfolio. We are implementing GHG emissions-reduction strategies where feasible to reduce emissions and their negative impact on climate change. The framework allows us to track, monitor and evaluate current performance, and make adjustments to our GHG emissions-reduction strategies.
Please see the Risk Factors in Item 1A, and our accompanying Consolidated Financial Statements and related notes thereto beginning on page of this Annual Report on Form 10-K for more detailed information.
SUN COMMUNITIES, INC.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This Annual Report on Form 10-K contains various "forward-looking statements" within the meaning of the Securities Act of 1933, as amended (the "Securities Act"), and the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and we intend that such forward-looking statements will be subject to the safe harbors created thereby. For this purpose, any statements contained in this filing that relate to expectations, beliefs, projections, future plans and strategies, trends or prospective events or developments and similar expressions concerning matters that are not historical facts are deemed to be forward-looking statements. Words such as "forecasts," "intends," "intend," "intended," "goal," "estimate," "estimates," "expects," "expect," "expected," "project," "projected," "projections," "plans," "predicts," "potential," "seeks," "anticipates," "anticipated," "should," "could," "may," "will," "designed to," "foreseeable future," "believe," "believes," "scheduled," "guidance," "target" and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these words. These forward-looking statements reflect our current views with respect to future events and financial performance, but involve known and unknown risks and uncertainties, both general and specific to the matters discussed in this filing. These risks and uncertainties may cause our actual results to be materially different from any future results expressed or implied by such forward-looking statements. In addition to the risks disclosed under "Risk Factors" in this Annual Report on Form 10-K and in our other filings with the SEC, such risks and uncertainties include, but are not limited to:
•Outbreaks of disease, including the COVID-19 pandemic, and related stay-at-home orders, quarantine policies and restrictions on travel, trade and business operations;
•Changes in general economic conditions, the real estate industry and the markets in which we operate;
•Difficulties in our ability to evaluate, finance, complete and integrate acquisitions, developments and expansions successfully;
•Our liquidity and refinancing demands;
•Our ability to obtain or refinance maturing debt;
•Our ability to maintain compliance with covenants contained in our debt facilities and our senior unsecured notes;
•Availability of capital;
•Changes in foreign currency exchange rates, including between the U.S. dollar and each of the Canadian dollar, Australian dollar and British pound;
•Our ability to maintain rental rates and occupancy levels;
•Our ability to maintain effective internal control over financial reporting and disclosure controls and procedures;
•Increases in interest rates and operating costs, including insurance premiums and real property taxes;
•Risks related to natural disasters such as hurricanes, earthquakes, floods, droughts and wildfires;
•General volatility of the capital markets and the market price of shares of our capital stock;
•Our ability to maintain our status as a REIT;
•Changes in real estate and zoning laws and regulations;
•Legislative or regulatory changes, including changes to laws governing the taxation of REITs;
•Litigation, judgments or settlements;
•Competitive market forces;
•The ability of purchasers of manufactured homes and boats to obtain financing; and
•The level of repossessions by manufactured home and boat lenders.
Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date the statement was made. We undertake no obligation to publicly update or revise any forward-looking statements included or incorporated by reference into this filing, whether as a result of new information, future events, changes in our expectations or otherwise, except as required by law.
Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. All written and oral forward-looking statements attributable to us or persons acting on our behalf are qualified in their entirety by these cautionary statements.
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The summary of risks below provides an overview of the principal risks that could affect our business, financial condition, results of operations, cash flows and / or prospects. This summary does not contain all of the information that may be important to you, and you should read the more detailed discussion of risks that follows this summary.
SUMMARY OF RISK FACTORS
MATERIAL RISKS RELATING TO OUR MH, RV AND MARINA BUSINESSES
•The geographic concentration of our properties in specific regions exposes us to the risks of downturns in local economies or other local real estate market conditions;
•We build and develop new MH communities, RV resorts and marinas and expand our existing properties, which exposes us to risks relating to zoning and permit laws, construction delays, unexpected development costs and fluctuations in occupancy rates at our newly developed properties;
•The industries in which we operate are highly-fragmented and we are subject to competition with national and regional players that may have greater resources than us;
•The cyclical and seasonal nature of the RV and marina industries lead to fluctuations in our operating results;
•Our continued growth is subject to our ability to successfully integrate and finance our acquisitions on favorable terms.
•The successful operation of our marinas depends on our ability to retain key employees with experience in the marina business, including Baxter R. Underwood, who is the Chief Executive Officer of Safe Harbor;
•Many of our properties are in areas that experience extreme weather conditions like floods, hurricanes, wildfires, sea-level rises or earthquakes and climate change could exacerbate these weather conditions;
•Marinas are specific-use properties and may contain features or assets that have limited alternative uses;
•Many of our marinas are situated on land controlled by governmental bodies and we must lease this land from them. These governmental authorities may terminate, fail to renew, or interpret in ways unfavorable to us, any of the permits, licenses, leases and approvals necessary for the operation of our marinas;
•Our properties are subject to various federal, state, local and foreign environmental laws and we may incur liability under these environmental laws for remediation and disposal of hazardous materials located on our properties;
•We may not complete our previously announced acquisition of Park Holidays and, even if we complete the acquisition, we may not realize the intended benefits of the Park Holidays acquisition;
•We will be subject to additional legal, regulatory, tax, supply chain, political and economic risks as we continue to expand our international investments;
•The ongoing COVID-19 pandemic may materially and adversely impact our financial condition, results of operations, cash flows and performance in unanticipated ways; and
•State and local rent control laws may inhibit our ability to increase rents to recover increases in our operating expenses.
RISKS RELATED TO OUR DEBT FINANCINGS
•We have a significant amount of debt which could limit our operational flexibility or otherwise adversely affect our financial condition;
•Any failure to meet our obligations on our secured debt could result in foreclosure on the collateral securing the debt; and
•Increases in market interest rates could materially increase our costs associated with existing and future debt. We mitigate the risks underlying increases in interest rates through hedging activities, but no hedging activity can protect us completely.
TAX RISKS RELATED TO OUR STATUS AS A REIT
•If we fail to qualify as a REIT our taxable income would be subject to federal income tax at a regular corporate rate which would materially and adversely affect our financial condition;
•The Operating Partnership could be classified as a "publicly traded partnership" which would subject it to taxation as a corporation and lead to substantial tax liabilities; and
•Compliance with the complex requirements and tests that are applied to REITs may hinder our ability to operate solely to maximize profits.
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RISKS RELATED TO RELATED PARTY TRANSACTIONS AND OUR STRUCTURE
•Some of our directors and officers may have conflicts of interest with respect to certain related party transactions and other business interests;
•Our governing documents prohibit, with limited exceptions, a single stockholder from owning more than 9.8 percent of our capital stock, which may discourage a change of control of the Company; and
•Certain provisions of Maryland law may discourage third parties from conducting a tender offer or otherwise acquiring us via a change of control transaction that could be beneficial to our stockholders.
GENERAL RISK FACTORS
•Our share price is subject to fluctuations that could be caused by a wide range of factors that could ultimately lead to a complete loss on our shareholders' investment;
•The sale or issuance of substantial amounts of our common or preferred stock could materially and adversely affect the market price of our common or preferred stock;
•We may not generate cash flows in an amount sufficient enough to make distributions on our stock, to pay our indebtedness, or to fund our other liquidity needs;
•A failure to maintain an effective system of internal controls may cause our financial reports to become inaccurate which could harm our reputation and have a material adverse effect on our operating results;
•Our, or our third party vendors', networks could become compromised, and the information stored there could be accessed, publicly disclosed, lost or stolen;
•We may experience losses in excess of our insurance coverages;
•Adverse content about us on social media platforms could result in damage to our reputation or brand; and
•We may be adversely impacted by fluctuations in foreign currency exchange rates.
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ITEM 1A. RISK FACTORS
ITEM 1A. RISK FACTORS
Our prospects are subject to certain uncertainties and risks. Our future results could differ materially from current results, and our actual results could differ materially from those projected in forward-looking statements as a result of certain risk factors. These risk factors include, but are not limited to, those set forth below, other one-time events, and important factors disclosed previously and from time to time in our other filings with the SEC.
MATERIAL RISKS RELATING TO OUR MH, RV AND MARINA BUSINESSES
General economic conditions and the concentration of our MH, RV and Marina properties in certain geographic areas may affect our ability to generate sufficient revenue.
The market and economic conditions in our current markets generally, and specifically in metropolitan areas of our current markets, may significantly affect occupancy or rental rates. Occupancy and rental rates, in turn, may significantly affect our revenues, and if our properties do not generate revenues sufficient to meet our operating expenses, including debt service and capital expenditures, our cash flow and ability to pay or refinance our debt obligations could be adversely affected.
As of December 31, 2021, 152 MH and RV properties, representing 25.5 percent of developed sites, are located in Florida; 90 properties, representing 17.8 percent of developed sites, are located in Michigan; 33 properties, representing 6.3 percent of developed sites, are located in Texas; and 45 properties, representing 6.3 percent of developed sites, are located in California. As of December 31, 2021, we have revenue concentrations of marinas in Florida, Rhode Island and California of approximately 22.6 percent, 8.0 percent and 6.5 percent, respectively. As a result of the geographic concentration of our MH and RV properties in Florida, Michigan, Texas and California, and geographic concentration of our marinas in Florida, Rhode Island and California, we are exposed to the risks of downturns in local economies or other local real estate market conditions which could adversely affect occupancy rates, rental rates and property values in these markets.
Our revenue would also be adversely affected if tenants were unable to pay rent or if sites were unable to be rented on favorable terms. If we were unable to promptly relet or renew the leases for a significant number of the sites, or if the rental rates upon such renewal or reletting were significantly lower than expected rates, then our business and results of operations could be adversely affected. In addition, certain expenditures associated with each property (such as real estate taxes and maintenance costs) generally are not reduced when circumstances cause a reduction in income from the property. Furthermore, real estate investments are relatively illiquid and, therefore, will tend to limit our ability to vary our portfolio promptly in response to changes in economic or other conditions.
The following factors, among others, may adversely affect the revenues generated by our properties:
•Outbreaks of disease, including the COVID-19 pandemic, and related stay-at-home orders, quarantine policies and restrictions on travel, trade and business operations;
•The national and local economic climate which may be adversely impacted by, among other factors, plant closings and industry slowdowns;
•Local real estate market conditions such as the oversupply of MH and RV sites or a reduction in demand for MH and RV sites in an area;
•A decrease in the number of people interested in the RV lifestyle or boating;
•Changes in foreign currency exchange rates, including between the U.S. dollar and each of the Canadian dollar, the Australian dollar and the British pound;
•The number of repossessed homes in a particular market;
•An oversupply of, or a reduced demand for, manufactured homes;
•The difficulty facing potential purchasers in obtaining affordable financing as a result of heightened lending criteria;
•An increase or decrease in the rate of manufactured home repossessions which provide aggressively priced competition to new manufactured home sales;
•The lack of an established MH dealer network;
•The housing rental market which may limit the extent to which rents may be increased to meet increased expenses without decreasing occupancy rates;
•The perceptions by prospective tenants of the safety, convenience and attractiveness of our MH properties and the neighborhoods where they are located;
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•Zoning or other environmental regulatory restrictions;
•Competition from other available MH communities and RV resorts and alternative forms of housing (such as apartment buildings and site-built single-family homes) and from other marinas;
•Our ability to effectively manage, maintain and insure our properties;
•Increased operating costs, including insurance premiums, real estate taxes and utilities; and
•The enactment of rent control laws or laws taxing the owners of manufactured homes.
We may not be able to integrate or finance our expansion and development activities.
We build and develop new MH communities, RV resorts and marinas and we expand existing communities and marinas. Our construction and development pipeline may be exposed to the following risks which are in addition to those risks associated with the ownership and operation of established MH communities, RV resorts and marinas:
•We may not be able to obtain financing with favorable terms for development which may make us unable to proceed with the development;
•We may be unable to obtain, or face delays in obtaining, necessary zoning, building and other governmental permits and authorizations, which could result in increased costs and delays, and even require us to abandon development of the property entirely if we are unable to obtain such permits or authorizations;
•We may abandon development opportunities that we have already begun to explore and as a result we may not recover expenses already incurred in connection with exploring such development opportunities;
•We may be unable to complete construction and lease-up of a property on schedule resulting in increased debt service expense and construction costs;
•We may incur construction and development costs for a property which exceed our original estimates due to increased materials, labor or other costs, which could make completing the development uneconomical and we may not be able to increase rents to compensate for the increase in development costs which may impact our profitability;
•We may be unable to secure long-term financing on completion of development resulting in increased debt service and lower profitability;
•Occupancy rates and rents at a newly developed property may fluctuate depending on several factors, including market and economic conditions, which may result in the property not being profitable; and
•Climate change may cause new marina developments to be paused or restricted.
If any of the above risks occur, our business and results of operations could be adversely affected.
Competition affects occupancy levels and rents, which could adversely affect our revenues.
The MH, RV and marina industries are highly-fragmented. There is competition within the MH, RV and marina markets we currently serve and in new markets that we may enter. We have both national and regional competitors in the MH, RV and marina markets. Our properties are located in developed areas that include other MH communities, RV resorts and marinas. The number of competitive MH communities, RV resorts and marinas in a particular area could have a material adverse effect on our ability to lease sites and increase rents charged at our properties or at any newly acquired properties. We may be competing with others with greater resources. In addition, other forms of multi-family residential properties, such as private and federally funded or assisted multi-family housing projects and single-family housing, provide housing alternatives to potential tenants of MH communities and RV resorts.
The cyclical and seasonal nature of the RV and marina industries may lead to fluctuations in our operating results.
The RV and marina industries can experience cycles of growth and downturn due to seasonality patterns. Results of operations in any one period may not be indicative of results in future periods. In the RV market, certain properties maintain higher occupancy during the summer months, while other properties maintain higher occupancy during the winter months. The RV market typically shows a decline in demand over the winter months, yet usually produces higher growth in the spring and summer months due to higher use by vacationers. In the marina market, demand for wet slip storage increases during the summer months as customers contract for the summer boating season, which also drives non-storage revenue streams such as service, fuel and on-premise restaurants or convenience storage. Demand for dry storage increases during the winter season as seasonal weather patterns require boat owners to store their vessels on dry docks and within covered racks. Our results on a quarterly basis can fluctuate due to this cyclicality and seasonality.
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We may not be able to integrate or finance our acquisitions and our acquisitions may not perform as expected.
We have acquired and intend to continue to selectively acquire MH, RV and marina properties. Our acquisition activities and their success are subject to the following risks:
•We may be unable to acquire a desired property because of competition from other well-capitalized real estate investors, including both publicly traded REITs and institutional investment funds;
•Even if we enter into an acquisition agreement for a property, it is usually subject to customary conditions to closing, including completion of due diligence investigations to our satisfaction, which may not be satisfied;
•Even if we are able to acquire a desired property, competition from other real estate investors may significantly increase the purchase price;
•We may be unable to finance acquisitions on favorable terms;
•Acquired properties may fail to perform as expected;
•Acquired properties may be located in new markets where we face risks associated with a lack of market knowledge or understanding of the local economy, lack of business relationships in the area, and unfamiliarity with local governmental and permitting procedures; and
•We may be unable to quickly and efficiently integrate new acquisitions, particularly acquisitions of portfolios of properties, into our existing operations.
If any of the above risks occur, our business and results of operations could be adversely affected.
In addition, we may acquire properties subject to liabilities and we may be left with no, or limited, recourse, with respect to unknown liabilities. As a result, we may have to pay substantial sums to settle any liabilities asserted against us based upon ownership of newly acquired properties, which could adversely affect our cash flow.
We depend on Safe Harbor's management to operate our marina business, and our acquisition of Safe Harbor presents us with new risks.
Before we acquired Safe Harbor in October 2020, we did not own or operate any marinas. Safe Harbor's operations are separate from our other operations. The successful operation of our marinas depends on our ability to retain key employees with experience in the marina business, including Baxter R. Underwood, who is the Chief Executive Officer of Safe Harbor. The loss of services of Mr. Underwood or other key employees could have a materially adverse effect on our ability to operate Safe Harbor. Although Mr. Underwood has entered into an employment and non-competition agreement, upon certain events he will have the option to eliminate the non-competition covenant by foregoing certain compensation and other benefits.
We do not currently maintain or contemplate obtaining any "key-man" life insurance on any of the key employees of Safe Harbor. Our entry into the marina business also subjects us to new laws and regulations and may lead to increased litigation and regulatory risk including but not limited to statutes and government regulations that govern the use of, and construction on, rivers, lakes and other waterways. Exposure to the marina industry may expose us to certain weather events and risks to which we have not previously been exposed. Additionally, the marina business may be affected in different ways or to a greater extent than our existing MH and RV business by the COVID-19 pandemic with respect to infection control, facility and work-site access, or other related issues.
Investments through joint ventures involve risks not present for properties in which we are the sole owner.
We have invested and may continue to invest as a joint venture partner in joint ventures. These investments involve risks, including, but not limited to, the possibility the other joint venture partner may have business goals which are inconsistent with ours, possess the ability to take or force action or withhold consent contrary to our requests, fail to provide capital or fulfill its obligations, or become insolvent and require us to assume and fulfill the joint venture's financial obligations. Conflicts arising between us and our joint venture partners may be difficult to manage or resolve and it could be difficult to manage or otherwise monitor the existing business arrangements. We and our joint venture partners may each have the right to initiate a buy-sell arrangement, which could cause us to sell our interest, or acquire a joint venture partner's interest, at a time when we otherwise would not have entered into such a transaction. Each joint venture agreement is individually negotiated, and our ability to operate, finance or dispose of a property in our sole discretion may be limited to varying degrees depending on the terms of the applicable joint venture agreement.
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Many of our properties are located in areas that experience extreme weather conditions and natural disasters and climate change may adversely affect our business.
Extreme weather or weather-related conditions and other natural disasters, including hurricanes, flash floods, sea-level rise, tornadoes, wildfires or earthquakes, may interrupt our operations, damage our properties and reduce the number of customers who utilize our properties in the affected areas. Many of our properties are on coastlines that are subject to hurricane seasons, flash flooding and sea-level rise; in areas adversely affected by wildfires, such as the western United States; and in earthquake-prone areas, such as the West Coast. If there are prolonged disruptions at our properties due to extreme weather or natural disasters, our results of operations and financial condition could be materially adversely affected.
While we maintain insurance coverage that may cover certain of the costs and loss of revenue associated with the effect of extreme weather and natural disasters at our properties, our coverage is subject to deductibles and limits on maximum benefits. We cannot assure you that we will be able to fully collect, if at all, on any claims resulting from extreme weather or natural disasters.
If any of our properties are damaged or if their operations are disrupted as a result of extreme weather or natural disasters, or if extreme weather or natural disasters adversely impact general economic or other conditions in the areas in which our properties are located or from which they draw their tenants and customers, our business, financial condition and results of operations could be materially adversely affected.
Significant changes in the climate could exacerbate extreme weather conditions or natural disasters that may occur in areas where our properties are located, all of which may result in additional physical damage to, or a decrease in demand for, properties located in these areas or affected by these conditions. If the impact of climate change is material in nature, including significant property damage to or destruction of our properties, or occur for lengthy periods of time, our financial condition or results of operations may be adversely affected. In addition, changes in federal, state, local and foreign legislation and regulation based on concerns about climate change could result in increased capital expenditures on our properties (for example, to improve their energy efficiency and / or resistance to inclement weather) without a corresponding increase in revenue, resulting in adverse impacts to our net income.
Marinas may not be readily adaptable to other uses.
Marinas are specific-use properties and may contain features or assets that have limited alternative uses. These properties may also have distinct operational functions that involve specific procedures and training. If the operations of any of our marinas become unprofitable due to industry competition, operational execution or otherwise, then it may not be feasible to operate the property for another use, and the value of certain features or assets used at the property, or the property itself, may be impaired. Should any of these events occur, our financial condition, results of operations and cash flows could be adversely impacted.
We may be unable to obtain, renew or maintain permits, licenses and approvals necessary for the operation of our marinas.
The U.S. Army Corps of Engineers, the Coast Guard and other governmental bodies control much of the land located beneath and surrounding many of our marinas and lease such land to Safe Harbor under leases that typically range from five to 50 years. As a result, it is unlikely that we can obtain fee-simple title to the land on or near these marinas. If these governmental authorities terminate, fail to renew, or interpret in ways that are materially less favorable any of the permits, licenses and approvals necessary for operation of these properties, then our financial condition, results of operations and cash flows could be adversely impacted.
Some marinas must be dredged from time to time to remove silt and mud that collect in harbor-areas in order to assure that boat traffic can safely enter the harbor. Dredging and disposing of the dredged material can be very costly and require permits from various governmental authorities. If the permits necessary to dredge marinas or dispose of the dredged material cannot be timely obtained after the acquisition of a marina, or if dredging is not practical or is exceedingly expensive, the operations of such property would be materially and adversely affected.
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We may incur liability under environmental laws arising from conditions at properties we acquire or operations at the properties we own and operate.
Under various federal, state, local and foreign laws, ordinances and regulations, an owner or operator of real estate is liable for the costs of removal or remediation of certain hazardous substances at, on, under, or in such property. Such hazardous substances may be used at or located on our properties, especially our marinas. Such laws often impose liability without regard to whether the owner knew of, or was responsible for, the presence of such hazardous substances. The presence of such substances, or the failure to properly remediate such substances, may adversely affect the owner's ability to sell or rent the property, to borrow using the property as collateral or to develop the property. Persons who arrange for the disposal or treatment of hazardous substances also may be liable for the costs of removal or remediation of such substances at a disposal or treatment facility owned or operated by another person. In addition, certain environmental laws impose liability for the management and disposal of asbestos-containing materials and for the release of such materials into the air. These laws may result in fines or penalties and may permit third parties to seek recovery from owners or operators of real properties for personal injury associated with asbestos-containing materials.
As the purchaser of properties we acquire or in connection with the operation of properties we own or manage, we may be liable for removal or remediation costs, governmental fines and injuries to persons and property. When we arrange for the treatment or disposal of hazardous substances at landfills or other facilities owned by other persons, we may be liable for the removal or remediation costs at such facilities.
We subject our properties to a Phase I or similar environmental assessment as well as limited compliance evaluations (which involve general inspections without soil sampling or ground water analysis) completed by independent environmental and engineering consultants. In some cases, where these evaluations have recommended further, invasive investigations, those have also been conducted. These environmental evaluations have not revealed any significant environmental liability that would have a material adverse effect on our business. These audits cannot reflect conditions arising after the studies were completed, and no assurances can be given that existing environmental studies reveal all environmental liabilities, that any prior owner or operator of a property or neighboring owner or operator did not create any material environmental condition not known to us, or that a material environmental condition does not otherwise exist as to any one or more properties.
Moreover, we cannot be sure that: (a) future laws, ordinances or regulations will not impose any material environmental liability; or (b) the current environmental condition of our properties will not be affected by tenants and occupants of the properties, by the condition of land or operations in the vicinity of our properties (such as the presence of underground storage tanks), or by unrelated third parties. Environmental liabilities that we may incur could have an adverse effect on our financial condition, results of operations and cash flows.
We may not complete our previously-announced acquisition of Park Holidays.
In November 2021, we entered into an agreement to acquire Park Holidays which owns, operates and manages 42 holiday communities in the United Kingdom. The acquisition values Park Holidays at an enterprise value of £950 million (or approximately $1.3 billion). While we anticipate that the Park Holidays acquisition will close in the first quarter of 2022, the closing is subject to the approval of the UK Financial Conduct Authority, which regulates certain loan brokering activities of Park Holidays. If this condition is not satisfied or waived, or if the Park Holidays purchase agreement is otherwise terminated in accordance with its terms, then we will not complete the Park Holidays acquisition. If we do not complete the acquisition, our common stock will not reflect any interest in Park Holidays; if the closing is delayed, this interest will not be reflected during the period of delay; and if the acquisition is restructured, it is uncertain as to whether this interest will be adversely affected. In addition, the price of our common stock may decline to the extent that the current market price of our common stock reflects a market assumption that the acquisition will be completed and that we will realize certain anticipated benefits of acquiring Park Holidays.
The closing of the Proposed Loan Amendment is subject to, among other things, the closing of our acquisition of Park Holidays. Therefore, if we are unable to complete the acquisition of Park Holidays then we will be unable to complete the Proposed Loan Amendment. Refer to Note 19, "Subsequent Events," in our accompanying Consolidated Financial Statements for additional information about the Proposed Loan Amendment.
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The intended benefits of the Park Holidays acquisition may not be realized.
The Park Holidays acquisition poses risks for our ongoing operations, including, among others:
•That senior management's attention may be diverted from the management of daily operations in our U.S. and Canadian properties to the integration of the Park Holidays properties;
•Costs and expenses associated with any undisclosed or potential liabilities that are not covered by our transaction insurance;
•That the Park Holidays properties may not perform as well as anticipated; and
•Unforeseen difficulties may arise in integrating operations in the United Kingdom into our company.
As a result of the foregoing, we cannot assure you that the Park Holidays acquisition will be accretive to us in the near term or at all. Furthermore, if we fail to realize the intended benefits of the Park Holidays properties, the market price of our common stock could decline to the extent that the market price reflects those benefits.
We will be subject to additional risks from our investment in Park Holidays and any other international investments.
Park Holidays will be our first major investment in the United Kingdom. We are also pursuing other significant acquisition opportunities outside the United States, including in the United Kingdom and elsewere in Europe, although there can be no assurances that we will be successful in completing any of these prospective acquisitions. These investments may expose us to a variety of risks that are different from and in addition to those commonly found in our current markets. Our ownership of Park Holidays and any other international investments will subject us to additional risks, including:
•the laws, rules and regulations applicable in such jurisdictions outside of the United States, including those related to property ownership by foreign entities, consumer and data protection, privacy, network security, encryption, payments and restricting us from removing profits earned from activities within the country to the United States (i.e., nationalization of assets located within a country);
•complying with a wide variety of foreign laws;
•fluctuations in exchange rates between foreign currencies and the U.S. dollar, and exchange controls;
•limited experience with local business and cultural factors that differ from our usual standards and practices;
•changes in the availability, cost and terms of mortgage funds and other borrowings resulting from varying national economic policies or changes in interest rates;
•reliance on local management;
•challenges in establishing effective controls and procedures to regulate operations in different regions and to monitor and ensure compliance with applicable regulations, such as applicable laws related to corrupt practices, employment, licensing, construction, climate change or environmental compliance;
•unexpected changes in regulatory requirements, tax, tariffs, trade barriers and other laws within jurisdictions outside the United States or between the United States and such jurisdictions;
•potentially adverse tax consequences with respect to our properties;
•the impact of regional or country-specific business cycles and economic instability, including deterioration in political relations with the United States, instability in, or further withdrawals from, the European Union or other international trade alliances or agreements;
•the impact of extreme weather or weather-related conditions and other natural disasters that may affect specific locations in which our properties are located, including hurricanes, flash floods, sea-level rise and coastal erosion, that may affect Park Holidays' properties;
•the impact of disruptions in global, regional or local supply chains, including disruptions occurring during and after the COVID-19 pandemic; and
•political instability, uncertainty over property rights, civil unrest, drug trafficking, political activism or the continuation or escalation of terrorist activities.
If we are unable to adequately address these risks, they could have a significant adverse effect on our operations.
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The United Kingdom's departure from the European Union could increase volatility in the financial markets and currency exchange rates, including the British pound.
The United Kingdom's exit from the European Union, commonly referred to as "Brexit," has created an uncertain political and economic environment in the United Kingdom and elsewhere. The consequences of Brexit, and continuing uncertainties related to Brexit, could negatively affect taxes and costs of business, diminish travel to and from the United Kingdom, cause volatility in currency exchange rates, interest rates, and European, United Kingdom or worldwide political, regulatory, economic or market conditions, and contribute to instability in political institutions, regulatory agencies, and financial markets. Brexit could also lead to legal uncertainty arising from divergence of the laws of the United Kingdom from those of the European Union. Any of these effects of Brexit, and others that cannot be anticipated, could adversely effect our existing and planned expansion in the United Kingdom and elsewhere, and therefore, could have a material adverse effect on us.
The current pandemic of the coronavirus, or COVID-19, may materially and adversely impact and disrupt our financial condition, results of operations, cash flows and performance.
The COVID-19 pandemic at times has had, and in the future it could continue to have, or a future pandemic could have, material and adverse effects on our ability to successfully operate, and on our financial condition, results of operations and cash flows, including in the following possible ways, among others:
•A downturn in the economy may affect the ability of the residents or customers in our MH communities and marinas to pay their rent.
•Travel restrictions may affect the ability of potential guests to travel to and use our RV resorts and marinas. A downturn in the economy may independently reduce demand for our RV resorts and marinas, and our RV revenue may decrease if we cannot convert as many transient RV sites to annual RV sites as planned.
•Certain properties may be subject to government restrictions which limit the ability to operate or provide certain amenities.
•We may have difficulty accessing debt and equity capital on attractive terms, or at all, and a severe disruption and instability in the global financial markets or deterioration in credit and financing conditions may result in insufficient liquidity or affect our access to capital necessary to fund and grow our business and address maturing liabilities on a timely basis. As of December 31, 2021, we had drawn $1.0 billion on our senior credit facility, of which the total capacity, excluding the unexercised accordion feature, is $2.0 billion.
•The financial impact of the COVID-19 pandemic could negatively impact our future compliance with financial covenants of our debt agreements and result in a default and potentially an acceleration of indebtedness, which non-compliance could negatively impact our ability to make additional borrowings under our senior credit facility.
•Our ground up development and expansion activities, and conversions of transient RV sites to annual RV sites may be disrupted, and we may be delayed in our current projects and timelines, the magnitude of which will depend, in part, on the length and severity of the current governmental restrictions or limitations implemented in the future.
•The ancillary revenue from amenities at our properties, such as restaurants, golf courses, resort and marina activities, may decrease.
•The operation of our marinas may be disrupted by the COVID-19 pandemic with respect to infection control, facility and work-site access, or other related issues. As result, we may experience delays in our current projects and timelines, the magnitude of which will depend on governmental restrictions or limitations implemented in the future.
•Negative impacts on our results of operations and our access to capital could cause us to eliminate or reduce the amount of our distributions to stockholders, or to pay some or all of our distributions in common stock rather than cash.
•A general decline in business activity and demand for real estate transactions could adversely affect our ability or desire to acquire additional properties.
•A recession or additional market corrections resulting from the spread of COVID-19 could affect the value of our common stock. We expect our stock price to continue to be volatile.
•Governmental agencies that permit and approve our projects, suppliers, homebuilders, and other business partners and third parties may be prevented from conducting business activities in the ordinary course for an indefinite period of time, which could in turn negatively affect our business.
•Disruptions in the global supply-chain could negatively impact our ability to secure the volume of homes and vacation rentals we need to meet market demand. These disruptions also could drive up costs across our business including capital expenditures, homes, home setups, and general property operations.
SUN COMMUNITIES, INC.
The extent to which the COVID-19 pandemic impacts our operations, financial condition and financial results will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the scope, severity and duration of the pandemic, the actions taken to contain the pandemic or mitigate its impact, and the direct and indirect economic effects of the pandemic and containment measures, among others. The rapid development and fluidity of this situation precludes any prediction as to the full adverse impact of the COVID-19 pandemic. Nevertheless, the COVID-19 pandemic presents material uncertainty and risk with respect to our performance, financial condition, results of operations, cash flows and performance. Moreover, many risk factors set forth in this Annual Report on Form 10-K should be interpreted as heightened risks as a result of the impact of the COVID-19 pandemic.
Rent control legislation may harm our ability to increase rents.
State and local rent control laws in certain jurisdictions may limit our ability to increase rents at our MH properties to recover increases in operating expenses and the costs of capital improvements. Enactment of such laws has been considered from time to time in other jurisdictions. Certain properties are located, and we may purchase additional properties, in markets that are either subject to rent control or in which rent-limiting legislation exists or may be enacted.
RISKS RELATED TO OUR DEBT FINANCINGS
Our significant amount of debt could limit our operational flexibility or otherwise adversely affect our financial condition, and we may incur more debt in the future.
We have a significant amount of debt. As of December 31, 2021, we had approximately $5.7 billion of total debt outstanding, consisting of approximately $3.4 billion in debt that is secured by mortgage liens on 190 of our properties, $1.2 billion of senior unsecured notes, $1.0 billion on our line of credit and other debt, $35.2 million of mandatorily redeemable preferred equity and $34.7 million of preferred OP units that are mandatorily redeemable. If we fail to meet our obligations under our secured debt, the lenders would be entitled to foreclose on all or some of the collateral securing such debt which could have a material adverse effect on us and our ability to make expected distributions, and could threaten our continued viability.
We are subject to the risks normally associated with debt financing, including the following risks:
•Our cash flow may be insufficient to meet required debt payments, or we may need to dedicate a substantial portion of our cash flow to pay our debt rather than to other areas of our business;
•Our existing indebtedness may limit our operating flexibility due to financial and other restrictive covenants, including restrictions on incurring additional debt;
•It may be more difficult for us to obtain additional financing for our operations, working capital requirements, capital expenditures, debt service or other general requirements;
•We may be more vulnerable in the event of adverse economic and industry conditions or a downturn in our business;
•We may be placed at a competitive disadvantage compared to our competitors that have less debt; and
•We may not be able to refinance at all or on favorable terms, as our debt matures.
If any of the above risks occurred, our financial condition and results of operations could be materially adversely affected.
Despite our current indebtedness levels, we may incur substantially more debt in the future. If new debt is added to our current debt levels, an even greater portion of our cash flow will be needed to satisfy our debt service obligations. As a result, the related risks that we now face could intensify and increase the risk of a default on our indebtedness.
Covenants in our credit agreements and senior unsecured note indentures could limit our flexibility and adversely affect our financial condition.
The terms of our financing agreements and other indebtedness require us to comply with a number of customary financial and other covenants. These covenants may limit our flexibility in our operations, and breaches of these covenants could result in defaults under the instruments governing the applicable indebtedness even if we have satisfied our payment obligations. Our financing agreements contain certain cross-default provisions that could be triggered in the event that we default on our other indebtedness. These cross-default provisions may require us to repay or restructure our senior credit facility in addition to any mortgage or other debt that is in default. If our properties were foreclosed upon, or if we are unable to refinance our indebtedness at maturity or meet our payment obligations, the amount of our distributable cash flows and our financial condition would be adversely affected.
SUN COMMUNITIES, INC.
Our senior credit facility contains various restrictive corporate covenants including: minimum fixed charge coverage ratio, maximum leverage ratio, maximum dividend payout ratio and maximum secured leverage ratio. In addition to our senior credit facility, our senior unsecured notes also contain various covenants including: aggregate debt test, debt service test, maintenance of total unencumbered assets and a secured debt test. These covenants may restrict our ability to pursue certain business initiatives or certain transactions that might otherwise be advantageous. Furthermore, failure to meet certain of these financial covenants could cause an event of default under and / or accelerate some or all of such indebtedness which could have a material adverse effect on us.
An increase in market interest rates could raise our interest costs on existing and future debt or adversely affect our stock price, and a decrease in interest rates may lead to additional competition for the acquisition of real estate or adversely affect our results of operations.
Our interest costs for any new debt and our current debt obligations may rise if interest rates increase. This increased cost could make the financing of any new acquisition more expensive as well as lower our current period earnings. Rising interest rates could limit our ability to refinance existing debt when it matures or cause us to pay higher interest rates upon refinancing. In addition, an increase in interest rates could decrease the access third parties have to credit, thereby decreasing the amount they are willing to pay to lease our assets and limit our ability to reposition our portfolio promptly in response to changes in economic or other conditions. An increase in market interest rates may lead prospective purchasers of our common stock to expect a higher dividend yield, which could adversely affect the market price of our common stock. Decreases in interest rates may lead to additional competition for the acquisition of real estate due to a reduction in desirable alternative income-producing investments. Increased competition for the acquisition of real estate may lead to a decrease in the yields on real estate targeted for acquisition. In such circumstances, if we are not able to offset the decrease in yields by obtaining lower interest costs on our borrowings, our results of operations may be adversely affected.
Our hedging strategies may not be successful in mitigating our risks associated with interest rates and could reduce the overall returns on your investment.
We use various derivative financial instruments to provide a level of protection against interest rate risks, but no hedging strategy can protect us completely. These instruments involve risks, such as the risk that the counterparties may fail to honor their obligations under these arrangements, that these arrangements may not be effective in reducing our exposure to interest rate changes, that a court could rule that such agreements are not legally enforceable and that we may have to post collateral to enter into hedging transactions, which we may lose if we are unable to honor our obligations. These instruments may also generate income that may not be treated as qualifying REIT income for purposes of the REIT income tests. In addition, the nature and timing of hedging transactions may influence the effectiveness of our hedging strategies. Poorly designed strategies or improperly executed transactions could actually increase our risk and losses. Moreover, hedging strategies involve transaction and other costs. We cannot assure you that our hedging strategy and the derivatives that we use will adequately offset the risk of interest rate volatility or that our hedging transactions will not result in losses that may reduce the overall return on your investment.
The phase out of the London Interbank Offered Rate (LIBOR), or the replacement of LIBOR with a different reference rate, may adversely affect interest rates.
The Financial Conduct Authority ("FCA"), the authority that regulates LIBOR, ceased publishing one-week and two-month LIBOR rates after December 31, 2021. All other LIBOR settings will effectively cease after June 30, 2023, and it is expected that LIBOR will no longer be used after this date. Many of our property-level real estate loans have fixed interest rates that will not be impacted by any change in LIBOR. Certain of our other loans, including our borrowings under our $2.0 billion senior credit facility, have interest rates based on LIBOR. Our senior credit facility provides that the administrative agent in consultation with us will endeavor to determine an interest rate to replace the current LIBOR based rate, and until the parties agree on a successor LIBOR rate we can continue to borrow under the senior credit facility using the prime rate. The replacement of LIBOR with an alternative rate or benchmark may adversely affect our interest rates and result in higher borrowing costs. This could materially and adversely affect our results of operations, cash flows and liquidity.
A downgrade in our credit ratings could have material adverse effects on our business and financial condition.
We intend to manage our operations to maintain our investment grade credit ratings from S&P Global and Moody's. These ratings are based on a number of factors, which include assessments of our financial strength, liquidity, capital structure, asset quality, and sustainability of cash flow and earnings. Changes in these factors could lead to a downgrade of our ratings, leading to an adverse impact on our cost and availability of capital, which could in turn have a material adverse impact on our financial condition, results of operations and liquidity.
SUN COMMUNITIES, INC.
TAX RISKS RELATED TO OUR STATUS AS A REIT
We may suffer adverse tax consequences and be unable to attract capital if we fail to qualify as a REIT.
We believe that since our taxable year ended December 31, 1994, we have been organized and operated, and intend to continue to operate, so as to qualify for taxation as a REIT under the Code. Although we believe that we have been and will continue to be organized and have operated and will continue to operate so as to qualify for taxation as a REIT, we cannot be assured that we have been or will continue to qualify as a REIT. Qualification as a REIT involves the satisfaction of numerous requirements (some on an annual and quarterly basis) established under highly technical and complex Code provisions for which there are only limited judicial or administrative interpretations and involves the determination of various factual matters and circumstances not entirely within our control. In addition, frequent changes occur in the area of REIT taxation, which require us to monitor our tax status continually.
If we fail to qualify as a REIT in any taxable year, our taxable income could be subject to U.S. federal income tax at regular corporate rates. Moreover, unless entitled to relief under certain statutory provisions, we also would be disqualified from treatment as a REIT for the four taxable years following the year during which qualification was lost. This treatment would reduce our net earnings available for investment or distribution to stockholders because of the additional tax liability to us for the years involved. In addition, distributions to stockholders would no longer be required to be made.
Federal, state and foreign income tax laws governing REITs and related interpretations may change at any time, and any such legislative or other actions affecting REITs could have a negative effect on us.
Federal, state and foreign income tax laws governing REITs, or the administrative interpretations of those laws may be amended at any time. Federal, state and foreign tax laws are under constant review by persons involved in the legislative process, at the Internal Revenue Service and the U.S. Department of the Treasury, and at various state and foreign tax authorities. Changes to tax laws, regulations or administrative interpretations, which may be applied retroactively, could adversely affect us. We cannot predict whether, when, in what forms, or with what effective dates, the tax laws, regulations and administrative interpretations applicable to us may be changed. Accordingly, we cannot assert that any such change will not significantly affect either our ability to qualify for taxation as a REIT or the income tax consequences to us.
We intend for the Operating Partnership to be taxed as a partnership, but we cannot guarantee that it will qualify.
We believe that the Operating Partnership has been organized as a partnership and will qualify for treatment as such under the Code. However, if the Operating Partnership is deemed to be a "publicly traded partnership," it will be treated as a corporation instead of a partnership for federal income tax purposes unless at least 90 percent of its income is qualifying income as defined in the Code. The income requirements applicable to REITs and the definition of "qualifying income" for purposes of this 90 percent test are similar in most respects. Qualifying income for the 90 percent test generally includes passive income, such as specified types of real property rents, distributions and interest. We believe that the Operating Partnership has and will continue to meet this 90 percent test, but we cannot guarantee that it has or will. If the Operating Partnership were to be taxed as a regular corporation, it would incur substantial tax liabilities, we would fail to qualify as a REIT for federal income tax purposes and our ability to raise additional capital could be significantly impaired.
Partnership tax audit rules could have a material adverse effect on us.
The Bipartisan Budget Act of 2015 changed the rules applicable to U.S. federal income tax audits of partnerships. Under the rules, effective for taxable years beginning in 2018, among other changes and subject to certain exceptions, any audit adjustment to items of income, gain, loss, deduction or credit of a partnership (and a partner's allocable share thereof) is determined, and taxes, interest, and penalties attributable thereto are assessed and collected, at the partnership level. Unless the partnership makes an election permitted under the new law or takes certain steps to require the partners to pay their tax on their allocable shares of the adjustment, it is possible that partnerships in which we directly or indirectly invest, including the Operating Partnership, would be required to pay additional taxes, interest and penalties as a result of an audit adjustment. We, as a direct or indirect partner of the Operating Partnership and other partnerships, could be required to bear the economic burden of those taxes, interest and penalties even though the Company, as a REIT, may not otherwise have been required to pay additional corporate-level tax. The changes created by these rules are significant for collecting tax in partnership audits and, accordingly, there can be no assurance that these rules will not have a material adverse effect on us.
SUN COMMUNITIES, INC.
Our ability to accumulate cash may be restricted due to certain REIT distribution requirements.
In order to qualify as a REIT, we must distribute to our stockholders at least 90 percent of our REIT taxable income (calculated without any deduction for dividends paid and excluding net capital gain) and to avoid federal income taxation, our distributions must not be less than 100 percent of our REIT taxable income, including capital gains. As a result of the distribution requirements, we do not expect to accumulate significant amounts of cash. Accordingly, these distributions could significantly reduce the cash available to us in subsequent periods to fund our operations and future growth.
Our taxable REIT subsidiaries, or TRSs, are subject to special rules that may result in increased taxes.
As a REIT, we must pay a 100 percent penalty tax on certain payments that we receive if the economic arrangements between us and any of our TRSs are not comparable to similar arrangements between unrelated parties. The Internal Revenue Service may successfully assert that the economic arrangements of any of our inter-company transactions are not comparable to similar arrangements between unrelated parties. This would result in unexpected tax liability which would adversely affect our cash flows.
Dividends payable by REITs do not qualify for the reduced tax rates applicable to certain dividends.
The maximum federal tax rate for certain qualified dividends payable to domestic stockholders that are individuals, trusts and estates is 20 percent. Dividends payable by REITs, however, are generally not eligible for this reduced rate, although the Tax Cut and Jobs Act permits a 20 percent deduction equal to the amount of qualifying REIT dividends received, thus bringing the maximum federal tax rate on qualifying REIT dividends to 29.6 percent. While this rule does not adversely affect the taxation of REITs or dividends paid by REITs, the more favorable rates applicable to regular qualified corporate dividends could cause investors who are individuals, trusts and estates to perceive investments in REITs to be relatively less competitive than investments in stock of non-REIT corporations that pay dividends, which could adversely affect the comparative value of the stock of REITs, including our common stock and preferred stock.
Prospective investors should consult their own tax advisors regarding the effect of this change on their effective tax rate with respect to REIT dividends.
Complying with REIT requirements may cause us to forego otherwise attractive opportunities.
To remain qualified as a REIT for federal income tax purposes, we must continually satisfy requirements and tests under the tax law concerning, among other things, the sources of our income, the nature and diversification of our assets, the amounts we distribute to our stockholders and the ownership of our stock. In order to meet these tests, we may be required to forego or limit attractive business or investment opportunities and distribute all of our net earnings rather than invest in attractive opportunities or hold larger liquid reserves. Therefore, compliance with the REIT requirements may hinder our ability to operate solely to maximize profits.
Our ability to use net operating loss carryforwards to reduce future tax payments may be limited if we experience a change in ownership, or if taxable income does not reach sufficient levels.
Under Section 382 of the Code, if a corporation undergoes an "ownership change" (generally defined as a greater than 50 percent change (by value) in its equity ownership over a rolling three-year period), the corporation's ability to use its pre-ownership-change net operating loss carryforwards to offset its post-ownership-change income may be limited. We may experience ownership changes in the future. If an ownership change were to occur, we would be limited in the portion of net operating loss carryforwards that we could use in the future to offset taxable income for U.S. federal income tax purposes.
SUN COMMUNITIES, INC.
RISKS RELATED TO RELATED PARTY TRANSACTIONS AND OUR STRUCTURE
Some of our directors and officers may have conflicts of interest with respect to certain related party transactions and other business interests.
Lease of Executive Offices - Gary A. Shiffman, together with certain of his family members, indirectly owns an equity interest of approximately 28.1 percent in American Center LLC, the entity from which we lease office space for our principal executive offices. Each of Brian M. Hermelin, Ronald A. Klein and Arthur A. Weiss indirectly owns less than one percent interest in American Center LLC. Mr. Shiffman is our Chief Executive Officer and Chairman of the Board. Each of Mr. Hermelin, Mr. Klein and Mr. Weiss is a director of the Company. Under this agreement, we lease approximately 103,100 rentable square feet of permanent space. The lease agreement includes annual graduated rent increases through the initial end date of October 31, 2026. As of December 31, 2021, the average gross base rent was $19.95 per square foot. Each of Mr. Shiffman, Mr. Hermelin, Mr. Klein and Mr. Weiss may have a conflict of interest with respect to his obligations as our officer and / or director and his ownership interest in American Center LLC.
Use of Airplane - Gary A. Shiffman is the beneficial owner of an airplane that we use from time to time for business purposes. During the years ended December 31, 2021, 2020 and 2019, we paid $0.7 million, $0.3 million and $0.4 million for the use of the airplane, respectively. Mr. Shiffman may have a conflict of interest with respect to his obligations as our officer and director and his ownership interest in the airplane.
Telephone Services - Brian M. Hermelin is a principal and a beneficial owner of an entity that installs and maintains emergency telephone systems at our properties. During the years ended December 31, 2021 and 2020, we paid $0.2 million for these services, respectively. Mr. Hermelin may have a conflict of interest with respect to his obligations as our director and his position with and ownership interest in the provider of these services.
Legal Counsel - During 2019-2021, Jaffe, Raitt, Heuer, & Weiss, Professional Corporation acted as our general counsel and represented us in various matters. Arthur A. Weiss is the Chairman of the Board of Directors and a shareholder of such firm. We incurred legal fees and expenses owed to Jaffe, Raitt, Heuer, & Weiss of approximately $10.3 million, $13.3 million and $11.1 million in the years ended December 31, 2021, 2020 and 2019, respectively.
Tax Consequences Upon Sale of Properties - Gary A. Shiffman holds limited partnership interests in the Operating Partnership which were received in connection with the contribution of properties from partnerships previously affiliated with him. Prior to any redemption of these limited partnership interests for our common stock, Mr. Shiffman will have tax consequences different from those on us and our public stockholders upon the sale of any of these partnerships. Therefore, we and Mr. Shiffman may have different objectives regarding the appropriate pricing and timing of any sale of those properties.
Certain provisions in our governing documents may make it difficult for a third-party to acquire us.
9.8 percent Ownership Limit. In order to qualify and maintain our qualification as a REIT, not more than 50 percent of the outstanding shares of our capital stock may be owned, directly or indirectly, by five or fewer individuals. Thus, ownership of more than 9.8 percent, in number of shares or value, of the issued and outstanding shares of our capital stock by any single stockholder has been restricted, with certain exceptions, for the purpose of maintaining our qualification as a REIT under the Code. Such restrictions in our charter do not apply to Milton M. Shiffman, Gary A. Shiffman and Robert B. Bayer; trustees, personal representatives and agents to the extent acting for them or their respective estates; or certain of their respective relatives.
The 9.8 percent ownership limit, as well as our ability to issue additional shares of common stock or shares of other stock (which may have rights and preferences over the common stock), may discourage a change of control of the Company and may also: (a) deter tender offers for the common stock, which offers may be advantageous to stockholders; and (b) limit the opportunity for stockholders to receive a premium for their common stock that might otherwise exist if an investor were attempting to assemble a block of common stock in excess of 9.8 percent of our outstanding shares or otherwise effect a change of control of the Company.
Preferred Stock. Our charter authorizes the Board of Directors to issue up to 20,000,000 shares of preferred stock, none of which is currently outstanding, and to establish the preferences and rights (including the right to vote and the right to convert into shares of common stock) of any shares issued. The power to issue preferred stock could have the effect of delaying or preventing a change in control of the Company even if a change in control were in the stockholders' interest.
SUN COMMUNITIES, INC.
Certain provisions of Maryland law could inhibit changes in control, which may discourage third parties from conducting a tender offer or seeking other change of control transactions that could involve a premium price for our common stock or that our stockholders otherwise believe to be in their best interest.
Certain provisions of the Maryland General Corporation Law ("MGCL") may have the effect of inhibiting a third-party from making a proposal to acquire us or of impeding a change of control under circumstances that otherwise could provide the holders of shares of our capital stock with the opportunity to realize a premium over the then-prevailing market price of such shares, including:
•"Business combination" provisions that, subject to limitations, prohibit certain business combinations between us and an "interested stockholder" (defined generally as any person who beneficially owns 10 percent or more of the voting power of our shares or an affiliate thereof or an affiliate or associate of ours who was the beneficial owner, directly or indirectly, of 10 percent or more of the voting power of our then outstanding voting stock at any time within the two-year period immediately prior to the date in question) for five years after the most recent date on which the stockholder becomes an interested stockholder, and thereafter impose fair price and / or supermajority and stockholder voting requirements on these combinations; and
•"Control share" provisions that provide that "control shares" of our company (defined as shares that, when aggregated with other shares controlled by the stockholder, entitle the stockholder to exercise one of three increasing ranges of voting power in electing directors) acquired in a "control share acquisition" (defined as the direct or indirect acquisition of ownership or control of issued and outstanding "control shares") have no voting rights except to the extent approved by our stockholders by the affirmative vote of at least two-thirds of all the votes entitled to be cast on the matter, excluding all interested shares.
The provisions of the MGCL relating to business combinations do not apply, however, to business combinations that are approved or exempted by our Board of Directors prior to the time that the interested stockholder becomes an interested stockholder. As permitted by the statute, our Board of Directors has by resolution exempted Milton M. Shiffman, Robert B. Bayer and Gary A. Shiffman, their affiliates and all persons acting in concert or as a group with the foregoing, from the business combination provisions of the MGCL and, consequently, the five-year prohibition and the supermajority vote requirements will not apply to business combinations between us and these persons. As a result, these persons may be able to enter into business combinations with us that may not be in the best interests of our stockholders without compliance by our company with the supermajority vote requirements and the other provisions of the statute.
Also, pursuant to a provision in our bylaws, we have exempted any acquisition of our stock from the control share provisions of the MGCL. However, our Board of Directors may by amendment to our bylaws opt into the control share provisions of the MGCL at any time in the future.
Additionally, Subtitle 8 of Title 3 of the MGCL permits our Board of Directors, without stockholder approval and regardless of what is currently provided in our charter or bylaws, to elect to be subject to certain provisions relating to corporate governance that may have the effect of delaying, deferring or preventing a transaction or a change of control of our company that might involve a premium to the market price of our common stock or otherwise be in our stockholders' best interests. These provisions include a classified board; two-thirds vote to remove a director; that the number of directors may only be fixed by the Board of Directors; that vacancies on the board as a result of an increase in the size of the board or due to death, resignation or removal can only be filled by the board, and the director appointed to fill the vacancy serves for the remainder of the full term of the class of director in which the vacancy occurred; and a majority requirement for the calling by stockholders of special meetings. Other than a classified board, the filling of vacancies as a result of the removal of a director and a majority requirement for the calling by stockholders of special meetings, we are already subject to these provisions, either by provisions of our charter and bylaws unrelated to Subtitle 8 or by reason of an election to be subject to certain provisions of Subtitle 8. In the future, our Board of Directors may elect, without stockholder approval, to make us subject to the provisions of Subtitle 8 to which we are not currently subject.
Our Board of Directors has power to adopt, alter or repeal any provision of our bylaws or make new bylaws, provided, however, that our stockholders may alter or repeal any provision of our bylaws and adopt new bylaws if any such alteration, repeal or adoption is approved by the affirmative vote of a majority of all votes entitled to be cast on the matter.
SUN COMMUNITIES, INC.
GENERAL RISK FACTORS
Our share price could be volatile and could decline, resulting in a substantial or complete loss on our stockholders' investment.
The stock markets, including the New York Stock Exchange ("NYSE"), on which we list our common stock, have experienced significant price and volume fluctuations. As a result, the market price of our common stock and preferred stock could be similarly volatile, and investors in our common stock and preferred stock may experience a decrease in the value of their shares, including decreases unrelated to our operating performance or prospects. The price of our common stock and preferred stock could be subject to wide fluctuations in response to a number of factors, including:
•Outbreaks of disease, including the COVID-19 pandemic, and related stay-at-home orders, quarantine policies and restrictions on travel, trade and business operations;
•Issuances of other equity securities in the future, including new series or classes of preferred stock;
•Our operating performance and the performance of other similar companies;
•Our ability to maintain compliance with covenants contained in our debt facilities and our senior unsecured notes;
•Actual or anticipated variations in our operating results, funds from operations, cash flows or liquidity;
•Changes in expectations of future financial performance or changes in our earnings estimates or those of analysts;
•Changes in our distribution policy;
•Publication of research reports about us or the real estate industry generally;
•Increases in market interest rates that lead purchasers of our common stock and preferred stock to demand a higher dividend yield;
•Changes in foreign currency exchange rates, including between the U.S. dollar and each of the Canadian dollar, the Australian dollar and the British pound;
•Changes in market valuations of similar companies;
•Adverse market reaction to the amount of our debt outstanding at any time, the amount of our debt maturing in the near-term and medium-term and our ability to refinance our debt, or our plans to incur additional debt in the future;
•Additions or departures of key management personnel;
•Speculation in the press or investment community;
•Equity issuances by us, or share resales by our stockholders or the perception that such issuances or resales may occur;
•Actions by institutional stockholders; and
•General market and economic conditions.
Many of the factors listed above are beyond our control. Those factors may cause the market price of our common stock or preferred stock to decline significantly, regardless of our financial condition, results of operations and prospects. It is impossible to provide any assurance that the market price of our common stock or preferred stock will not fall in the future, and it may be difficult for holders to resell shares of our common stock or preferred stock at prices they find attractive, or at all. In the past, securities class action litigation has often been instituted against companies following periods of volatility in their stock price. This type of litigation could result in substantial costs and divert our management's attention and resources.
Substantial sales or issuances of our common or preferred stock could cause our stock price to fall.
The sale or issuance of substantial amounts of our common stock or preferred stock, whether directly by us or in the secondary market, the perception that such sales could occur or the availability of future issuances of shares of our common stock, preferred stock, OP units or other securities convertible into or exchangeable or exercisable for our common stock or preferred stock, could materially and adversely affect the market price of our common stock or preferred stock and our ability to raise capital through future offerings of equity or equity-related securities. In addition, we may issue capital stock that is senior to our common stock in the future for a number of reasons, including to finance our operations and business strategy, to adjust our ratio of debt to equity or for other reasons.
SUN COMMUNITIES, INC.
Based on the applicable conversion ratios then in effect, as of February 15, 2022, in the future we may issue to the limited partners of the Operating Partnership, up to approximately 5.7 million shares of our common stock in exchange for their OP units. The limited partners may sell such shares pursuant to registration rights, if available, or an available exemption from registration. As of February 15, 2022, there were no outstanding options to purchase shares of our common stock under our equity incentive plans, and we currently have the authority to issue restricted stock awards or options to purchase up to an additional 614,662 shares of our common stock pursuant to our equity incentive plans. In addition, we have entered into an At-the-Market Offering Sales Agreement to sell shares of common stock. As of December 31, 2021, we have remaining capacity to sell up to an additional $1.25 billion of common stock under this agreement. No prediction can be made regarding the effect that future sales of shares of our common stock or our other securities will have on the market price of shares.
Our business operations may not generate the cash needed to make distributions on our capital stock or to service our indebtedness, and we may adjust our common stock distribution policy.
Our ability to make distributions on our common stock and preferred stock, and payments on our indebtedness and to fund planned capital expenditures will depend on our ability to generate cash in the future. We cannot assure you that our business will generate sufficient cash flow from operations or that future borrowings will be available to us in an amount sufficient to enable us to make distributions on our common stock or preferred stock, to pay our indebtedness or to fund our other liquidity needs.
The decision to declare and pay distributions on shares of our common stock in the future, as well as the timing, amount and composition of any such future distributions, will be at the sole discretion of our Board of Directors in light of conditions then existing, including our earnings, financial condition, capital requirements, debt maturities, the availability of debt and equity capital, applicable REIT and legal restrictions, general overall economic conditions and other factors. Any change in our distribution policy could have a material adverse effect on the market price of our common stock.
We rely on key management.
We depend on the efforts of our executive officers, Gary A. Shiffman, John B. McLaren, Karen J. Dearing, Bruce Thelen, Aaron Weiss and Baxter R. Underwood. The loss of services of one or more of these executive officers could have a temporary adverse effect on our operations. We do not currently maintain or contemplate obtaining any "key-man" life insurance on our executive officers.
If we fail to maintain an effective system of internal controls, we may not be able to accurately report financial results, which could result in a loss of investor confidence and adversely affect the market price of our common stock.
We are required to establish and maintain internal control over financial reporting and disclosure controls and procedures. Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with generally accepted accounting principles. Disclosure controls and procedures are processes designed to ensure that information required to be disclosed is communicated to management and reported in a timely manner. We cannot be certain that we will be successful in continuing to maintain adequate control over our financial reporting and disclosure controls and procedures. Deficiencies, including any material weakness, in our internal control over financial reporting that may occur could result in misstatements or restatements of our financial statements or a decline in the price of our securities. In addition, as our business continues to grow, and as we continue to make significant acquisitions, our internal controls will become more complex and may require significantly more resources to ensure that our disclosure controls and procedures remain effective. Acquisitions can pose challenges in implementing the required processes, procedures and controls in the operations of the companies that we acquire. Companies that are acquired by us may not have disclosure controls and procedures or internal control over financial reporting that are as thorough or effective as those required by the securities laws that currently apply to us. Moreover, the existence of any material weakness or significant deficiency in our internal controls and procedures would require management to devote significant time and incur significant expense to remediate any such material weaknesses or significant deficiencies and management may not be able to remediate any such material weaknesses or significant deficiencies in a timely manner. If we cannot provide reliable financial reports, our reputation and operating results could be materially adversely affected, which could also cause investors to lose confidence in our reported financial information, which in turn could result in a reduction in the trading price of our common stock.
SUN COMMUNITIES, INC.
Cybersecurity breaches and other disruptions could compromise our information and expose us to liability, which would cause our business and reputation to suffer.
We rely intensively on information technology to account for tenant transactions, manage the privacy of tenant data, communicate internally and externally, and analyze our financial and operating results. In the ordinary course of our business, we collect and store sensitive data, including our proprietary business information and that of our tenants, clients, vendors and employees in our facilities and on our network. In addition, we engage third party service providers that may have access to such information in connection with providing necessary information technology and security and other business services to us. This information may include personally identifiable information such as social security numbers, banking information and credit card information.
We address potential breaches or disclosure of this confidential information by implementing a variety of security measures intended to protect the confidentiality and security of this information including (among others) engaging reputable, recognized firms to help us design and maintain our information technology and data security systems, including testing and verification of their proper and secure operations on a periodic basis. We also maintain cyber risk insurance to provide some coverage for certain risks arising out of data and network breaches. Our senior leadership regularly updates the Board of Directors on security matters and meets at least annually to review program progress and plans, incidents if any, and emerging risks.
Despite our security measures, our information technology and infrastructure, as well as that of our third-party vendors, may be vulnerable to attacks by hackers (including through malware, ransomware, computer viruses and email phishing schemes) or breached due to employee error, malfeasance, fire, flood or other physical event, or other disruptions. Any such breach or disruption could compromise our or a third-party vendor's network and the information stored there could be accessed, publicly disclosed, lost or stolen. Any such access, disclosure or other loss of information could:
•Result in legal claims or proceedings,
•Disrupt our operations, including our ability to service our tenants and our ability to analyze and report our financial and operating results,
•Decrease our revenues,
•Damage our reputation,
•Cause a loss of confidence,
•Increase our insurance premiums, or
•Have other material adverse effects on our business.
We depend on continuous access to the internet to use our cloud-based applications. Damage to, or failure of our information technology systems, including as a result of any of the reasons described above, could adversely affect our results of operations as we may incur significant costs or data loss. We continually assess new and enhanced information technology solutions to manage the risk of system failure or interruption.
Losses in excess of our insurance coverage or uninsured losses could adversely affect our operating results and cash flow.
We have a significant concentration of MH and RV properties in Florida and California and marinas on coastlines, where natural disasters or other catastrophic events such as hurricanes, flash floods, sea-level rise, tornadoes, wildfires and earthquakes could negatively impact our operating results and cash flows. We maintain comprehensive liability, fire, property, business interruption, general liability and (where appropriate) flood and earthquake insurance, and other lines of insurance we have determined to be appropriate for our business, provided by reputable companies with commercially reasonable deductibles and limits. We believe the policy specifications and insured limits are appropriate and adequate given the relative risk of loss, the cost of the coverage and industry practice. However, certain types of losses including, but not limited to, riots or acts of war, may be either uninsurable or not economically insurable. In the event an uninsured loss occurs, we could lose both our investment in and anticipated profits and cash flow from the affected property. We would also continue to be obligated to repay any mortgage indebtedness or other obligations related to the community. If an uninsured liability to a third party were to occur, we would incur the cost of defense and settlement with, or court ordered damages to, that third party. A significant uninsured property or liability loss could have a material adverse effect on our business and our financial condition and results of operations.
SUN COMMUNITIES, INC.
Expanding social media platforms present new challenges.
Social media outlets continue to grow and expand, which presents us with new risks. Adverse content about us and our properties on social media platforms could result in damage to our reputation or brand. Improper posts by employees or others could result in disclosure of confidential or proprietary information regarding our operations.
Our operations are subject to regulation under various federal, state, local and foreign laws and regulations that may expose us to significant costs and liabilities.
Our properties and the operations at them are subject to regulation under various federal, state, local and foreign laws and regulations. Compliance with laws and regulations that govern our operations may require expenditures and modifications of development plans and operations that could have a detrimental effect on the operations of our properties and our financial condition, results of operations and cash flows. There can be no assurance that the application of laws, regulations or policies, or changes in such laws, regulations and policies, will not occur in a manner that could have a detrimental effect on any property.
We may be adversely impacted by fluctuations in foreign currency exchange rates.
Our current and future investments in and operations of Canadian, Australian and United Kingdom properties are or will be exposed to the effects of changes in the Canadian dollar, Australian dollar and British pound, respectively, against the U.S. dollar. Changes in foreign currency exchange rates cannot always be predicted; as a result, substantial unfavorable changes in exchange rates could have a material adverse effect on our financial condition and results of operations.

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ITEM 1B. UNRESOLVED STAFF COMMENTS
ITEM 1B. UNRESOLVED STAFF COMMENTS
None.
SUN COMMUNITIES, INC.

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ITEM 2. PROPERTIES
ITEM 2. PROPERTIES
As of December 31, 2021, our properties were located throughout the United States, and in Ontario, Canada and Puerto Rico and consisted of 284 MH communities, 160 RV resorts, 33 properties containing both MH and RV sites, and 125 marinas.
As of December 31, 2021, our properties contained an aggregate of 204,163 developed sites comprised of 98,621 developed MH sites, 30,540 annual RV sites (inclusive of both annual and seasonal usage rights), 29,847 transient RV sites and 45,155 wet slips and dry storage spaces. There are 10,672 additional MH and RV sites suitable for development. Most of our properties include amenities oriented toward family and retirement living. Of our 602 properties, 218 each have 300 or more developed sites, with the largest having 2,341 developed MH and RV sites. See "Real Estate and Accumulated Depreciation, Schedule III," included in our Consolidated Financial Statements, for detail on properties that are encumbered.
As of December 31, 2021, our MH and RV properties had an occupancy rate of 97.4 percent excluding transient RV sites. Since January 1, 2021, the MH and RV properties have averaged an aggregate annual turnover of homes (where the home is moved out of the community) of approximately 2.6 percent and an average annual turnover of residents (where the resident-owned home is sold and remains within the community, typically without interruption of rental income) of approximately 7.1 percent. The average renewal rate for residents in our Rental Program was 73.5 percent for the year ended December 31, 2021.
We believe that our properties' high amenity levels, customer service loyalty, and customer retention program contribute to low turnover and generally high occupancy rates. All of the properties provide residents with attractive amenities with most offering a clubhouse, a swimming pool and laundry facilities. Many of the properties offer additional amenities such as sauna / whirlpool spas, tennis courts, shuffleboard, basketball courts and / or exercise rooms. Many RV resorts offer incremental amenities including golf, pro shops, restaurants, zip lines, waterparks, watersports and thematic experiences.
Our MH and RV properties are principally located in the midwestern, southern and southeastern regions of the U.S., and Ontario, Canada. Our marinas are principally located in the northeastern, southern, mid-Atlantic, western and midwestern regions of the U.S., with the majority of such marinas concentrated in coastal regions, others located in various inland regions, and Puerto Rico. We believe that geographic diversification helps to insulate the portfolio from regional economic influences. We have concentrated our properties within certain areas of the regions in order to achieve economies of scale in management and operation.
The following tables set forth certain information relating to our MH and RV properties as of December 31, 2021. The occupancy percentage includes MH sites and annual RV sites and excludes transient RV sites.
Property Name MH/RV City State MH and Annual RV Sites as of 12/31/2021
Transient RV Sites as of 12/31/2021
Occupancy as of 12/31/2021
Occupancy as of 12/31/2020
UNITED STATES
MIDWEST
Michigan
Academy / West Point MH Canton MI 441 - 98.4 % 98.0 %
Allendale Meadows Mobile Village MH Allendale MI 352 - 99.4 % 99.1 %
Alpine Meadows Mobile Village MH Grand Rapids MI 403 - 98.5 % 97.3 %
Andover MH Grass Lake MI 125 - 100.0 % N/A (4)
Apple Carr Village MH Muskegon MI 713 - 92.8 % (1)
86.5 % (1)
Arbor Woods MH Ypsilanti MI 458 - 98.9 % 99.1 %
Brentwood Mobile Village MH Kentwood MI 195 - 97.9 % 99.5 %
Broadview Estates MH Davison MI 474 - 88.2 % 87.1 %
Brookside Village MH Kentwood MI 196 - 98.5 % 100.0 %
Byron Center Mobile Village MH Byron Center MI 143 - 99.3 % 98.6 %
Camelot Villa MH Macomb MI 712 - 99.0 % 98.6 %
Charlevoix Estates MH Charlevoix MI 183 - 98.9 % N/A (4)
Cider Mill Crossings MH Fenton MI 621 - 94.8 % (1)
87.6 % (1)
Cider Mill Village MH Middleville MI 258 - 98.4 % 98.4 %
Country Acres Mobile Village MH Cadillac MI 182 - 98.9 % 95.1 %
Country Hills Village MH Hudsonville MI 239 - 99.2 % 99.6 %
Country Meadows Mobile Village MH Flat Rock MI 577 - 99.7 % 98.8 %
SUN COMMUNITIES, INC.
Property Name MH/RV City State MH and Annual RV Sites as of 12/31/2021
Transient RV Sites as of 12/31/2021
Occupancy as of 12/31/2021
Occupancy as of 12/31/2020
Country Meadows Village MH Caledonia MI 395 - 99.7 % 100.0 %
Creekwood Meadows MH Burton MI 336 - 97.6 % 99.1 %
Cutler Estates Mobile Village MH Grand Rapids MI 259 - 97.7 % 98.8 %
Dutton Mill Village MH Caledonia MI 307 - 99.7 % 99.3 %
East Village Estates MH Washington Twp. MI 708 - 98.4 % 99.9 %
Egelcraft MH Muskegon MI 458 - 98.9 % 97.8 %
Fisherman's Cove MH Flint Twp. MI 162 - 98.8 % 98.1 %
Frenchtown Villa / Elizabeth Woods MH Newport MI 1,140 - 99.3 % 99.2 %
Grand Mobile Estates MH Grand Rapids MI 219 - 99.1 % 98.2 %
Haas Lake Park RV Campground(2)
RV New Hudson MI 210 282 100.0 % N/A (4)
Hamlin MH Webberville MI 230 - 98.3 % 98.7 %
Hickory Hills Village MH Battle Creek MI 283 - 98.9 % 99.6 %
Highland Greens Estates MH Highland MI 879 - 64.6 % 56.5 %
Holiday West Village MH Holland MI 341 - 99.4 % 99.7 %
Holly Village / Hawaiian Gardens MH Holly MI 425 - 98.4 % 97.9 %
Hunters Crossing MH Capac MI 114 - 100.0 % 100.0 %
Hunters Glen MH Wayland MI 396 - 98.0 % 98.7 %
Huntington Run MH Kalamazoo MI 175 - 98.9 % N/A (4)
Kensington Meadows MH Lansing MI 290 - 97.9 % 96.2 %
Kimberly Estates MH Newport MI 387 - 98.2 % 98.2 %
King's Court Mobile Village MH Traverse City MI 802 - 99.5 % 99.0 %
Knollwood Estates MH Allendale MI 161 - 96.3 % 96.9 %
Lafayette Place MH Warren MI 254 - 96.9 % 99.2 %
Lakeview MH Ypsilanti MI 392 - 97.7 % 99.0 %
Leisure Village MH Belmont MI 256 - 99.6 % 99.6 %
Lincoln Estates MH Holland MI 191 - 98.4 % 98.4 %
Meadow Lake Estates MH White Lake MI 425 - 98.8 % 99.3 %
Meadowbrook Estates MH Monroe MI 453 - 98.7 % 99.1 %
Meadowlands of Gibraltar MH Gibraltar MI 320 - 99.7 % 99.4 %
Meadowstone MH Hastings MI 231 - 94.4 % N/A (4)
Northville Crossing MH Northville MI 756 - 99.7 % 99.7 %
Oak Island Village MH East Lansing MI 250 - 97.6 % 100.0 %
Petoskey KOA RV Resort(2)
RV Petoskey MI 50 239 100.0 % 100.0 %
Pinebrook Village MH Kentwood MI 185 - 98.9 % 98.9 %
Pineview Estates MH Flint MI 1,011 - 71.1 % N/A (4)
Presidential Estates Mobile Village MH Hudsonville MI 364 - 97.3 % 99.2 %
Richmond Place MH Richmond MI 117 - 98.3 % 100.0 %
River Haven Village MH Grand Haven MI 721 - 99.2 % 96.1 %
River Ridge MH Saline MI 288 - 100.0 % N/A (4)
Rudgate Clinton MH Clinton Township MI 667 - 98.7 % 99.3 %
Rudgate Manor MH Sterling Heights MI 931 - 98.0 % 98.8 %
Scio Farms Estates MH Ann Arbor MI 913 - 98.8 % 99.1 %
Sheffield Estates MH Auburn Hills MI 228 - 100.0 % 99.1 %
Shelby Forest MH Shelby Twp. MI 664 - 98.9 % 99.5 %
Shelby West MH Shelby Twp. MI 644 - 99.4 % 99.7 %
Silver Springs MH Clinton Township MI 547 - 99.3 % 100.0 %
Southwood Village MH Grand Rapids MI 394 - 99.0 % 99.7 %
St. Clair Place MH St. Clair MI 100 - 97.0 % 97.0 %
Stonebridge MH Richfield Twp. MI - - N/A (1)
N/A (1)
Sun Outdoors Petoskey Bay Harbor(2)
RV Petoskey MI 13 140 100.0 % 100.0 %
Sun Retreats Gun Lake(2)
RV Hopkins MI 232 103 100.0 % 100.0 %
SUN COMMUNITIES, INC.
Property Name MH/RV City State MH and Annual RV Sites as of 12/31/2021
Transient RV Sites as of 12/31/2021
Occupancy as of 12/31/2021
Occupancy as of 12/31/2020
Sun Retreats Silver Lake(2)
RV Mears MI 161 103 100.0 % 100.0 %
Sunset Ridge MH Portland MI 388 - 95.1 % 87.6 % (1)
Sycamore Village MH Mason MI 396 - 98.7 % 99.0 %
Sylvan Crossing MH Chelsea MI 185 - 74.6 % (1)
N/A (4)
Sylvan Glen Estates MH Brighton MI 476 - 94.7 % N/A (4)
Tamarac Village MH Ludington MI 302 - 98.7 % 98.3 %
Tamarac Village RV Resort(2)
RV Ludington MI 111 2 100.0 % 100.0 %
Tanglewood Village MH Brownstown MI 247 - 98.8 % N/A (4)
Timberline Estates MH Coopersville MI 296 - 98.6 % 98.3 %
Town & Country Mobile Village MH Traverse City MI 192 - 97.9 % 99.0 %
Troy Villa MH Troy MI 282 - 85.8 % 86.9%
Warren Dunes Village MH Bridgman MI 314 - 99.7 % 98.7 %
Waverly Shores Village MH Holland MI 415 - 100.0 % 100.0 %
West Village Estates MH Romulus MI 628 - 100.0 % 98.9 %
White Lake Mobile Home Village MH White Lake MI 315 - 96.8 % 98.4 %
Windham Hills Estates MH Jackson MI 469 - 98.7 % 98.3 %
Windsor Woods Village MH Wayland MI 314 - 99.7 % 99.7 %
Woodhaven Place MH Woodhaven MI 220 - 95.5 % 100.0 %
Michigan Total 32,257 869 96.3 % 96.6 %
Indiana
Brookside Mobile Home Village MH Goshen IN 570 - 97.5 % 97.2 %
Carrington Pointe MH Fort Wayne IN 468 - 90.2 % (1)
85.5 % (1)
Clear Water Mobile Village MH South Bend IN 227 - 98.2 % 97.4 %
Cobus Green Mobile Home Park MH Osceola IN 386 - 98.4 % 98.2 %
Four Seasons MH Elkhart IN 218 - 99.5 % 98.2 %
Jellystone Park™ at Barton Lake(2)
RV Fremont IN 87 468 100.0 % N/A
Liberty Farm MH Valparaiso IN 220 - 96.8 % 95.9 %
Pebble Creek MH Greenwood IN 296 - 99.0 % 98.6 %
Pine Hills MH Middlebury IN 130 - 98.5 % 98.4 %
Roxbury Park MH Goshen IN 398 - 96.2 % 97.7 %
Sun Outdoors Lake Rudolph(2)
RV Santa Claus IN - 534 N/A N/A
The Willows MH Goshen IN 174 - 83.3 % (1)
N/A (4)
Indiana Total 3,174 1,002 96.0 % 95.6 %
Ohio
Apple Creek MH Amelia OH 176 - 96.6 % 99.4 %
East Fork Crossing MH Batavia OH 350 - 99.4 % 99.7 %
Oakwood Village MH Miamisburg OH 511 - 99.4 % 98.6 %
Orchard Lake MH Milford OH 147 - 99.3 % 97.3 %
Sun Retreats Geneva on the Lake(2)
RV Geneva on the Lake OH 451 129 100.0 % 100.0 %
Westbrook Senior Village MH Toledo OH 112 - 100.0 % 100.0 %
Westbrook Village MH Toledo OH 344 - 98.5 % 98.3 %
Willowbrook Place MH Toledo OH 266 - 97.4 % 99.2 %
Woodside Terrace MH Holland OH 439 - 97.0 % 96.8 %
Ohio Total 2,796 129 98.7 % 98.7 %
SOUTH
Texas
Austin Lone Star RV Resort(2)
RV Austin TX 56 101 100.0 % 100.0 %
Bluebonnet Lake MH Austin TX - - N/A N/A (4)
SUN COMMUNITIES, INC.
Property Name MH/RV City State MH and Annual RV Sites as of 12/31/2021
Transient RV Sites as of 12/31/2021
Occupancy as of 12/31/2021
Occupancy as of 12/31/2020
Boulder Ridge MH Pflugerville TX 1,220 - 98.5 % 97.1 %
Branch Creek Estates MH Austin TX 400 - 99.8 % 100.0 %
Camp Fimfo(2)
RV New Braunfels TX - 319 N/A N/A (4)
Chisholm Point Estates MH Pflugerville TX 427 - 98.6 % 99.3 %
Comal Farms MH New Braunfels TX 367 - 99.5 % 98.6 %
Coyote Ranch Resort(2)
RV Wichita Falls TX - 165 N/A N/A (4)
Creeks Crossing MH Kyle TX 106 - 94.3 % (1)
N/A
Jellystone Park™ at Guadalupe River(2)
RV Kerrville TX - 256 N/A N/A
Jellystone Park™ at Hill Country(2)
RV Canyon Lake TX - 185 N/A N/A
Jellystone Park™ at Whispering Pines(2)
RV Tyler TX - 131 N/A N/A (4)
Jetstream RV Resort at NASA(2)
RV Houston TX 63 139 100.0 % N/A (4)
Lone Star Jellystone Park(2)
RV Waller TX - 345 N/A N/A
Oak Crest MH Austin TX 654 - 97.6 % 94.2 % (1)
Pearwood RV Resort(2)
RV Pearland TX 41 103 100.0 % N/A (4)
Pecan Branch MH Georgetown TX 229 - 96.1 % 86.0 % (1)
Pine Trace MH Houston TX 680 - 97.8 % 98.5 %
River Ranch MH Austin TX 848 - 98.5 % 97.6 %
River Ridge Estates MH Austin TX 515 - 99.2 % 99.2 %
Saddlebrook MH San Marcos TX 561 - 99.1 % 99.1 %
Sandy Lake MH Carrollton TX 54 - 100.0 % 100.0 %
Sandy Lake RV Resort(2)
RV Carrollton TX 181 39 100.0 % 100.0 %
Stonebridge MH San Antonio TX 335 - 99.7 % 99.1 %
Summit Ridge MH Converse TX 446 - 99.1 % 99.1 %
Sun Outdoors Lake Travis(2)
RV Austin TX 78 166 100.0 % N/A
Sun Outdoors San Antonio West(2)
RV San Antonio TX 101 161 100.0 % 100.0 %
Sun Outdoors Texas Hill Country(2)
RV New Braunfels TX 116 253 100.0 %
100.0 %
Sunset Ridge MH Kyle TX 274 - 75.9 % (1)
97.1 %
Travelers World MH San Antonio TX 8 - 100.0 % 100.0 %
Travelers World RV Resort(2)
RV San Antonio TX 25 130 100.0 % 100.0 %
Treetops RV Resort(2)
RV Arlington TX 91 83 100.0 % 100.0 %
Woodlake Trails MH San Antonio TX 316 - 93.7 % (1)
90.5 % (1)
Texas Total 8,192 2,576 97.7 % 97.5 %
SOUTHEAST
Florida
Arbor Terrace RV Park(2)
RV Bradenton FL 269 102 100.0 % 100.0 %
Ariana Village MH Lakeland FL 207 - 99.0 % 98.6 %
Bahia Vista Estates MH Sarasota FL 251 - 99.6 % 99.6 %
Baker Acres RV Resort(2)
RV Zephyrhills FL 286 66 100.0 % 100.0 %
Big Tree RV Resort(2)
RV Arcadia FL 355 56 100.0 % 100.0 %
Blue Heron Pines MH Punta Gorda FL 408 - 99.5 % 98.3 %
Blue Jay MH Dade City FL 207 - 99.5 % 99.5 %
Blue Jay RV Resort(2)
RV Dade City FL 41 11 100.0 % 100.0 %
Blueberry Hill(2)
RV Bushnell FL 322 83 100.0 % 100.0 %
Brentwood Estates MH Hudson FL 191 - 99.5 % 98.4 %
Buttonwood Bay MH Sebring FL 407 - 99.3 % 99.0 %
Buttonwood Bay RV Resort(2)
RV Sebring FL 353 179 100.0 % 100.0 %
Candlelight Manor MH South Daytona FL 128 - 100.0 % 99.2 %
Carriage Cove MH Sanford FL 467 - 99.6 % 100.0 %
Central Park MH Haines City FL 114 - 90.4 % 90.4 %
Central Park Resort RV Resort(2)
RV Haines City FL 227 137 100.0 % 100.0 %
SUN COMMUNITIES, INC.
Property Name MH/RV City State MH and Annual RV Sites as of 12/31/2021
Transient RV Sites as of 12/31/2021
Occupancy as of 12/31/2021
Occupancy as of 12/31/2020
Citrus Hill RV Resort(2)
RV Dade City FL 131 51 100.0 % 100.0 %
Club Naples(2)
RV Naples FL 246 59 100.0 % 100.0 %
Club Wildwood MH Hudson FL 478 - 100.0 % 100.0 %
Colony in the Wood MH Port Orange FL 383 - 100.0 % 99.0 %
Country Squire MH Paisley FL 97 - 99.0 % 99.0 %
Country Squire RV Resort(2)
RV Paisley FL 24 1 100.0 % 100.0 %
Cypress Greens MH Lake Alfred FL 259 - 98.5 % 98.5 %
Daytona Beach RV Resort(2)
RV Port Orange FL 148 85 100.0 % 100.0 %
Deerwood MH Orlando FL 569 - 99.5 % 98.1 %
Dunedin RV Resort(2)
RV Dunedin FL 196 43 100.0 % 100.0 %
Ellenton Gardens RV Resort(2)
RV Ellenton FL 153 41 100.0 % 100.0 %
Fairfield Village MH Ocala FL 293 - 100.0 % 99.7 %
Flamingo Lake RV Resort(2)
RV Jacksonville FL 80 342 100.0% N/A
Forest View MH Homosassa FL 300 - 98.7 % 98.7 %
Glen Haven MH Zephyrhills FL 52 - 100.0 % 100.0 %
Glen Haven RV Resort(2)
RV Zephyrhills FL 173 45 100.0 % 100.0 %
Goldcoaster MH Homestead FL 531 - 99.2 % 99.6 %
Goldcoaster RV Resort(2)
RV Homestead FL 6 8 100.0 % 100.0 %
Grand Bay MH Dunedin FL 134 - 99.3 % 100.0 %
Grand Lakes RV Resort(2)
RV Citra FL 316 92 100.0 % 100.0 %
Grove Ridge RV Resort(2)
RV Dade City FL 166 80 100.0 % 100.0 %
Groves RV Resort(2)
RV Ft. Myers FL 232 37 100.0 % 100.0 %
Gulfstream Harbor MH Orlando FL 974 - 99.9 % 99.6 %
Hacienda Del Rio MH Edgewater FL 730 - 99.5 % 98.8 %
Hidden River RV Resort(2)
RV Riverview FL 208 93 100.0 % 100.0 %
Holly Forest Estates MH Holly Hill FL 402 - 100.0 % 100.0 %
Homosassa River RV Resort(2)
RV Homosassa Springs FL 135 89 100.0 % 100.0 %
Horseshoe Cove RV Resort(2)
RV Bradenton FL 333 143 100.0 % 100.0 %
Indian Creek Park MH Ft. Myers Beach FL 353 - 100.0 % 100.0 %
Indian Creek RV Park(2)
RV Ft. Myers Beach FL 973 104 100.0 % 100.0 %
Island Lakes MH Merritt Island FL 301 - 100.0 % 100.0 %
King's Lake MH DeBary FL 245 - 100.0 % 100.0 %
Kings Manor MH Lakeland FL 239 - 97.1 % 96.7 %
Kings Pointe MH Lake Alfred FL 226 - 99.1 % 99.6 %
Kissimmee Gardens MH Kissimmee FL 240 - 99.6 % 100.0 %
Kissimmee South MH Davenport FL 142 - 91.5 % 90.8 %
Kissimmee South RV Resort(2)
RV Davenport FL 144 57 100.0 % 100.0 %
La Costa Village MH Port Orange FL 658 - 100.0 % 100.0 %
Lake Josephine RV Resort(2)
RV Sebring FL 119 59 100.0 % 100.0 %
Lake Juliana Landings MH Auburndale FL 274 - 98.2 % 98.2 %
Lake Pointe Village MH Mulberry FL 362 - 99.4 % 99.4 %
Lake San Marino RV Park(2)
RV Naples FL 252 155 100.0 % 100.0 %
Lakeland RV Resort(2)
RV Lakeland FL 206 25 100.0 % 100.0 %
Lakeshore Landings MH Orlando FL 307 - 99.3 % 100.0 %
Lakeshore Villas MH Tampa FL 280 - 98.2 % 98.6 %
Lamplighter MH Port Orange FL 259 - 99.6 % 100.0 %
Lazy Lakes RV Resort(2)
RV Summerland Key FL - 99 N/A N/A (4)
Majestic Oaks RV Resort(2)
RV Zephyrhills FL 231 23 100.0 % 100.0 %
Marco Naples RV Resort(2)
RV Naples FL 207 94 100.0 % 100.0 %
Meadowbrook Village MH Tampa FL 257 - 100.0 % 100.0 %
Mill Creek MH Kissimmee FL 34 - 94.1 % 88.2 %
SUN COMMUNITIES, INC.
Property Name MH/RV City State MH and Annual RV Sites as of 12/31/2021
Transient RV Sites as of 12/31/2021
Occupancy as of 12/31/2021
Occupancy as of 12/31/2020
Mill Creek RV Resort(2)
RV Kissimmee FL 135 21 100.0 % 100.0 %
Naples RV Resort(2)
RV Naples FL 122 45 100.0 % 100.0 %
New Ranch MH Clearwater FL 94 - 98.9 % 97.9 %
North Lake Estates(2)
RV Moore Haven FL 191 81 100.0 % 100.0 %
Oakview Estates MH Arcadia FL 119 - 100.0 % 100.0 %
Ocean Breeze - Jensen Beach MH Jensen Beach FL 309 - 77.3 % (1)
73.6 % (1)
Ocean Breeze - Jensen Beach RV Resort(2)
RV Jensen Beach FL 97 83 100.0 % 100.0 %
Ocean Breeze - Marathon MH Marathon FL 47 - 74.5 % (1)(5)
31.9 % (1)(5)
Ocean Breeze - Marathon RV Resort RV Marathon FL - - - % (5)
- % (5)
Orange City MH Orange City FL 4 - 100.0 % 100.0 %
Orange City RV Resort(2)
RV Orange City FL 417 104 100.0 % 100.0 %
Orange Tree Village MH Orange City FL 246 - 100.0 % 99.2 %
Paddock Park South MH Ocala FL 188 - 80.3 % 79.8 %
Palm Key Village MH Davenport FL 204 - 100.0 % 100.0 %
Palm Village MH Bradenton FL 146 - 100.0 % 100.0 %
Park Place MH Sebastian FL 476 - 96.8 % 96.2 %
Park Royale MH Pinellas Park FL 309 - 99.0 % 100.0 %
Pecan Park RV Resort(2)
RV Jacksonville FL 67 274 100.0 % 100.0 %
Pelican Bay MH Micco FL 216 - 99.5 % 99.1 %
Pleasant Lake RV Resort(2)
RV Bradenton FL 296 45 100.0 % 100.0 %
Rainbow MH Frostproof FL 37 - 100.0 % 100.0 %
Rainbow RV Resort(2)
RV Frostproof FL 414 48 100.0 % 100.0 %
Rainbow Village of Largo(2)
RV Largo FL 259 50 100.0 % 100.0 %
Rainbow Village of Zephyrhills(2)
RV Zephyrhills FL 347 35 100.0 % 100.0 %
Red Oaks MH Bushnell FL 103 - 93.2 % (1)
93.2 % (1)
Red Oaks RV Resort(2)
RV Bushnell FL 512 405 100.0 % 100.0 %
Regency Heights MH Clearwater FL 391 - 98.7 % 99.0 %
Riverside Club MH Ruskin FL 728 - 89.8 % 86.4 %
Riverside Village MH Jensen Beach FL 71 - N/A (1)
N/A (4)
Rock Crusher Canyon RV Resort(2)
RV Crystal River FL 228 167 100.0 % 100.0 %
Royal Country MH Miami FL 864 - 99.8 % 99.9 %
Royal Palm Village MH Haines City FL 395 - 87.3 % 86.1 %
Saddle Oak Club MH Ocala FL 376 - 99.7 % 99.7 %
Saralake Estates MH Sarasota FL 202 - 99.5 % 99.5 %
Savanna Club MH Port St. Lucie FL 1,069 - 98.5 % 98.5 %
Serendipity MH North Fort Myers FL 338 - 97.3 % 97.9 %
Settler's Rest RV Resort(2)
RV Zephyrhills FL 301 77 100.0 % 100.0 %
Shadow Wood Village MH Hudson FL 260 - 78.8 % (1)
87.0 % (1)
Shady Road Villas MH Ocala FL 129 - 87.6 % 85.4 %
Shell Creek Marina MH Punta Gorda FL 54 - 98.1 % 98.1 %
Shell Creek RV Resort & Marina(2)
RV Punta Gorda FL 155 30 100.0 % 100.0 %
Siesta Bay RV Park(2)
RV Ft. Myers FL 751 46 100.0 % 100.0 %
Southern Charm MH Zephyrhills FL 1 - 100.0 % 100.0 %
Southern Charm RV Resort(2)
RV Zephyrhills FL 403 93 100.0 % 100.0 %
Southern Leisure RV Resort(2)
RV Chiefland FL 167 330 100.0 % N/A (4)
Southern Pines MH Bradenton FL 107 - 96.3 % 96.3 %
Southport Springs Golf & Country Club MH Zephyrhills FL 547 - 99.1 % 99.3 %
Spanish Main MH Thontosassa FL 56 - 91.1 % 87.5 %
Spanish Main RV Resort(2)
RV Thontosassa FL 232 47 100.0 % 100.0 %
Stonebrook MH Homosassa FL 215 - 94.0 % (1)
93.5 % (1)
Sun Outdoors Islamorada MH Islamorada FL - - - % (5)
- % (5)
SUN COMMUNITIES, INC.
Property Name MH/RV City State MH and Annual RV Sites as of 12/31/2021
Transient RV Sites as of 12/31/2021
Occupancy as of 12/31/2021
Occupancy as of 12/31/2020
Sun Outdoors Islamorada RV Resort RV Islamorada FL - - - % (5)
- % (5)
Sun Outdoors Key Largo(2)
RV Key Largo FL 17 21 100.0 % 100.0 %
Sun Outdoors Marathon(2)
RV Marathon FL 27 58 100.0 % 100.0 %
Sun Outdoors Orlando Champions Gate MH Davenport FL 44 - 75.0 % 97.7 %
Sun Outdoors Orlando Champions Gate RV Resort(2)
RV Davenport FL 60 200 100.0 % 100.0%
Sun Outdoors Panama City Beach MH Panama City Beach FL 42 - 97.6 % 95.2 %
Sun Outdoors Panama City Beach RV Resort(2)
RV Panama City Beach FL - 159 - % (1)
N/A
Sun Outdoors Sarasota(2)
RV Sarasota FL 1,079 440 100.0 % 100.0 %
Sun Outdoors St. Augustine(2)
RV St. Augustine FL - 175 N/A N/A
Suncoast Gateway MH Port Richey FL 173 - 98.8 % 98.8 %
Sundance MH Zephyrhills FL 332 - 100.0 % 100.0 %
Sunlake Estates MH Grand Island FL 408 - 97.1 % 97.1 %
Sunset Harbor at Cow Key Marina MH Key West FL 77 - 98.7 % 98.7 %
Sweetwater RV Resort(2)
RV Zephyrhills FL 211 80 100.0 % 100.0 %
Tallowwood Isle MH Coconut Creek FL 274 - 97.1 % 95.6 %
Tampa East MH Dover FL 31 - 100.0 % 100.0 %
Tampa East RV Resort(2)
RV Dover FL 559 110 100.0 % 100.0 %
The Hamptons Golf & Country Club MH Auburndale FL 829 - 99.5 % 99.0 %
The Hideaway MH Key West FL 13 - 100.0 % 92.3 %
The Hills MH Apopka FL 97 - 99.0 % 100.0 %
The Landings at Lake Henry MH Haines City FL 394 - 99.2 % 99.7 %
The Ridge MH Davenport FL 481 - 99.4 % 99.4 %
The Valley MH Apopka FL 148 - 100.0 % 100.0 %
ThemeWorld RV Resort(2)
RV Davenport FL 98 50 100.0 % N/A (4)
Three Lakes(2)
RV Hudson FL 254 53 100.0 % 100.0 %
Tranquility MHC MH Bushnell FL 26 - 23.1 % N/A (4)
Vista del Lago MH Bradenton FL 136 - 100.0 % 99.3 %
Vista del Lago RV Resort(2)
RV Bradenton FL 35 5 100.0 % 100.0 %
Vizcaya Lakes MH Port Charlotte FL 108 - 96.3 % 92.6 %
Walden Woods MH Homosassa FL 213 - 100.0 % 100.0 %
Walden Woods II MH Homosassa FL 213 - 100.0 % 100.0 %
Water Oak Country Club Estates MH Lady Lake FL 1,341 - 93.2 % 93.6 %
Waters Edge RV Resort(2)
RV Zephyrhills FL 142 75 100.0 % 100.0 %
Westside Ridge MH Auburndale FL 219 - 99.5 % 99.1 %
Windmill Village MH Davenport FL 509 - 99.8 % 99.6 %
Woodlands at Church Lake MH Groveland FL 291 - 85.2 % 81.8 %
Woodsmoke Camping Resort(2)
RV Fort Myers FL 216 84 100.0 % 100.0 %
Florida Total 40,783 5,950 98.1 % 98.1 %
Virginia
Chincoteague Island KOA RV Resort(3)
RV Chincoteague VA - 360 N/A N/A
Gwynn's Island RV Resort & Campground(2)
RV Gwynn VA 116 13 100.0 % 100.0 %
Jellystone Park™ at Luray(2)
RV East Luray VA - 255 N/A N/A
Jellystone Park™ at Natural Bridge(2)
RV Natural Bridge Station VA 69 230 100.0 % 100.0 %
New Point RV Resort(2)
RV New Point VA 313 11 100.0 % 100.0 %
Pine Ridge MH Prince George VA 376 - 99.5 % 98.9 %
Shenandoah Acres Family Campground(2)
RV Stuarts Draft
VA 379 113 100.0 % 100.0 %
Sun Outdoors Cape Charles(2)
RV Cape Charles VA - 663 N/A N/A (4)
Sun Outdoors Chincoteague Bay RV Chincoteague VA - - N/A (1)
N/A (4)
Sunset Beach RV Resort(3)
RV Cape Charles VA - 296 N/A N/A
SUN COMMUNITIES, INC.
Property Name MH/RV City State MH and Annual RV Sites as of 12/31/2021
Transient RV Sites as of 12/31/2021
Occupancy as of 12/31/2021
Occupancy as of 12/31/2020
Tall Pines Harbor Campground(2)
RV Temperanceville VA - 241 N/A N/A (4)
Virginia Total 1,253 2,182 99.8 % 99.6 %
SOUTHWEST
California
49'er Village RV Resort(2)
RV Plymouth CA 88 239 100.0 % 100.0 %
Alta Laguna MH Rancho Cucamonga CA 296 - 99.7 % 99.7 %
Caliente Sands MH Cathedral City CA 118 - 98.3 % 98.3 %
Cava Robles RV Resort(2)
RV Paso Robles CA - 332 N/A N/A
Cisco Grove Campground & RV RV Emigrant Gap CA 18 - 100.0 % N/A (4)
El Capitan Canyon(2)
RV Goleta CA - 163 N/A N/A
Forest Springs MH Grass Valley CA 373 - 89.5 % (1)
86.6 % (1)
Friendly Village of La Habra MH La Habra CA 330 - 100.0 % 100.0 %
Friendly Village of Modesto MH Modesto CA 289 - 99.7 % 99.0 %
Friendly Village of Simi MH Simi Valley CA 222 - 100.0 % 100.0 %
Friendly Village of West Covina MH West Covina CA 157 - 100.0 % 100.0 %
Heritage MH Temecula CA 196 - 99.5 % 99.5 %
Indian Wells RV Resort(2)
RV Indio CA 165 173 100.0 % 100.0 %
Jellystone Park™ at Tower Park(2)
RV Lodi CA - 361 N/A N/A
Lakefront MH Lakeside CA 295 - 99.0 % 100.0 %
Lakeview Mobile Estates MH Yucaipa CA 296 - 100.0 % 100.0 %
Lazy J Ranch MH Arcata CA 220 - 99.1 % 99.5 %
Lemon Wood MH Ventura CA 231 - 100.0 % 99.1 %
Menifee Development MH Menifee CA - - N/A (1)
N/A (4)
Moreno 66 Development MH Moreno Valley CA - - N/A (1)
N/A (4)
Napa Valley MH Napa CA 257 - 100.0 % 99.6 %
Oak Creek MH Coarsegold CA 198 - 99.5 % 100.0 %
Ocean Mesa RV Resort(2)
RV Goleta CA - 104 N/A N/A
Ocean West MH McKinleyville CA 130 - 99.2 % 99.2 %
Palos Verdes Shores MH & Golf Community MH San Pedro CA 242 - 99.6 % 100.0 %
Pembroke Downs MH Chino CA 163 - 99.4 % 100.0 %
Pismo Dunes RV Resort RV Pismo Beach CA 331 - 100.0 % 100.0 %
Rancho Alipaz MH San Juan Capistrano CA 132 - 100.0 % 100.0 %
Rancho Caballero MH Riverside CA 303 - 100.0 % 100.0 %
Royal Palms MH Cathedral City CA 438 - 97.7 % 97.7 %
Royal Palms RV Resort RV Cathedral City CA 39 - 100.0 % 100.0 %
Sun Outdoors San Diego Bay MH San Diego CA 49 - N/A (1)
N/A (1)
Sun Outdoors San Diego Bay RV Resort(2)
RV San Diego CA - 197 N/A (1)
N/A (1)
The Colony MH Oxnard CA 150 - 100.0 % 100.0 %
The Sands RV & Golf Resort(2)
RV Desert Hot Springs CA 269 245 100.0 % 100.0 %
Vallecito MH Newbury Park CA 303 - 100.0 % 100.0 %
Victor Villa MH Victorville CA 287 - 99.7 % 100.0 %
Vines RV Resort(2)
RV Paso Robles CA - 130 N/A N/A
Vista del Lago MH Scotts Valley CA 202 - 99.0 % 99.5 %
Wine Country RV Resort(2)
RV Paso Robles CA - 203 N/A N/A
California Total 6,787 2,147 98.3 % 98.9 %
Arizona
Blue Star MH Apache Junction AZ 4 - 100.0 % 100.0%
Blue Star(2)
RV Apache Junction AZ 114 31 100.0 % 100.0%
Brentwood West MH Mesa AZ 350 - 99.7 % 99.1 %
SUN COMMUNITIES, INC.
Property Name MH/RV City State MH and Annual RV Sites as of 12/31/2021
Transient RV Sites as of 12/31/2021
Occupancy as of 12/31/2021
Occupancy as of 12/31/2020
Buena Vista MH Buckeye AZ 400 - 89.8 % 84.8 %
Desert Harbor MH Apache Junction AZ 205 - 100.0 % 100.0 %
La Casa Blanca MH Apache Junction AZ 198 - 100.0 % 100.0 %
Leaf Verde RV Resort(2)
RV Buckeye AZ 113 264 100.0 % 100.0 %
Lost Dutchman MH Apache Junction AZ 193 - 96.4 % 98.9 %
Lost Dutchman RV Resort(2)
RV Apache Junction AZ 3 31 100.0 % 100.0 %
Mountain View MH Mesa AZ 170 - 97.6 % 98.8 %
Palm Creek Golf MH Casa Grande AZ 506 - 71.1 % (1)
66.6 % (1)
Palm Creek Golf & RV Resort(2)
RV Casa Grande AZ 976 859 100.0 % 100.0 %
Rancho Mirage MH Apache Junction AZ 312 - 100.0 % 100.0 %
Reserve at Fox Creek MH Bullhead City AZ 311 - 99.7 % 99.7 %
Sun Valley MH Apache Junction AZ 268 - 97.8 % 97.4 %
Arizona Total 4,123 1,185 95.0 % 93.2 %
Colorado
Cave Creek MH Evans CO 447 - 99.6 % 99.3 %
Eagle Crest MH Firestone CO 441 - 99.8 % 99.5 %
Jellystone Park™ at Larkspur(2)
RV Larkspur CO - 536 N/A N/A
North Point Estates MH Pueblo CO 108 - 99.1 % 100.0 %
River Run MH Granby CO 36 - 100.0 % 55.6 % (1)
River Run RV Resort(2)
RV Granby CO - 451 N/A N/A
Skyline MH Fort Collins CO 170 - 99.4 % 99.4 %
Smith Creek Crossing MH Granby CO 182 - 44.5 % (1)
42.7 % (1)
Swan Meadow Village MH Dillon CO 174 - 100.0 % 99.4 %
The Foothills MH Fort Collins CO - - N/A N/A (4)
The Grove at Alta Ridge MH Thornton CO 409 - 100.0 % 100.0 %
Timber Ridge MH Ft. Collins CO 585 - 99.3 % 99.5 %
Willow Bend MH Fort Lupton CO - - N/A N/A (4)
Colorado Total 2,552 987 95.7 % 97.0 %
NORTHEAST
Connecticut
Beechwood MH Killingworth CT 297 - 98.7 % 97.3 %
Cedar Springs MH Southington CT 190 - 96.8 % 93.2 %
Forest Hill MH Southington CT 188 - 97.9 % 98.4 %
Grove Beach MH Westbrook CT 136 - 98.5 % 98.5 %
Hillcrest MH Uncasville CT 208 - 99.5 % 99.5 %
Lakeside MH Terryville CT 76 - 100.0 % 97.4 %
Lakeview CT MH Danbury CT 179 - 93.3 % 90.5 %
Laurel Heights MH Uncasville CT 49 - 95.9 % 95.9 %
Marina Cove MH Uncasville CT 25 - 76.0 % 76.0 %
Millwood MH Uncasville CT 45 - 4.4 % (1)
N/A (1)
New England Village MH Westbrook CT 60 - 100.0 % 100.0 %
Oak Grove MH Plainville CT 45 - 97.8 % 97.8 %
Rolling Hills MH Storrs CT 200 - 78.5 % 77.5 %
Sun Outdoors Mystic(2)
RV Old Mystic CT 46 103 100.0 % 100.0 %
Three Gardens MH Southington CT 135 - 90.4 % 90.4 %
Yankee Village MH Old Saybrook CT 23 - 100.0 % 100.0 %
Connecticut Total 1,902 103 92.8 % 91.7 %
SUN COMMUNITIES, INC.
Property Name MH/RV City State MH and Annual RV Sites as of 12/31/2021
Transient RV Sites as of 12/31/2021
Occupancy as of 12/31/2021
Occupancy as of 12/31/2020
Maine
Augusta Village MH Augusta ME 59 - 91.5 % 89.8 %
Birch Hill Estates MH Bangor ME 377 - 98.9 % 98.7 %
Cedar Haven MH Holden ME 155 - 89.7 % 92.9 %
Hancock Heights Estates MH Hancock ME 113 - 99.1 % 100.0 %
Holiday Park Estates MH Bangor ME 218 - 89.0 % 91.3 %
Jellystone Park™ Augusta Maine RV North Monmouth ME 204 - 100.0 % N/A (4)
Maplewood Manor MH Brunswick ME 296 - 99.0 % 99.3 %
Merrymeeting MH Brunswick ME 43 - 97.7 % 100.0 %
Riverside Drive Park MH Augusta ME 163 - 82.2 % 85.3 %
Saco / Old Orchard Beach KOA(2)
RV Saco ME - 191 N/A N/A
Sun Outdoors Old Orchard Beach Downtown(2)
RV Old Orchard Beach ME 86 235 100.0 % 100.0 %
Sun Retreats at Wild Acres(2)
RV Old Orchard Beach ME 326 304 100.0 % 100.0 %
Sun Retreats Old Orchard Beach(2)
RV Old Orchard Beach ME 240 46 100.0 % 100.0 %
Town & Country Village MH Lisbon ME 144 - 98.6 % 98.6 %
Wells Beach Resort Campground(2)
RV Wells ME - 231 N/A N/A (4)
Maine Total 2,424 1,007 96.5 % 96.8 %
New Hampshire
Brook Ridge MH Hooksett NH 91 - 100.0 % 100.0 %
Crestwood MH Concord NH 320 - 99.4 % 98.8 %
Farmwood Village MH Dover NH 159 - 99.4 % 100.0 %
Glen Ellis Family Campground(2)
RV Glen NH 16 277 100.0 % 100.0 %
Hannah Village MH Lebanon NH 81 - 97.5 % 100.0 %
Hemlocks MH Tilton NH 103 - 100.0 % 99.0 %
Mi-Te-Jo Campground(2)
RV Milton NH 68 156 100.0 % 100.0 %
River Pines MH Nashua NH 480 - 99.4 % 99.0 %
Strafford / Lake Winnipesaukee South KOA(3)
RV Strafford NH - 147 N/A N/A
Westward Shores Cottages & RV Resort(2)
RV West Ossipee NH 430 70 100.0 % 100.0 %
New Hampshire Total 1,748 650 99.5 % 99.4 %
New Jersey
Cape May Crossing MH Cape May NJ 28 - 100.0 % 100.0 %
Deep Run MH Cream Ridge NJ 243 - 100.0 % 100.0 %
Driftwood RV Resort & Campground(2)
RV Clermont NJ 639 68 100.0 % 100.0 %
Holly Shores Camping Resort(2)
RV Cape May NJ - 310 N/A N/A (4)
Hospitality Creek Campground(2)
RV Williamstown NJ - 230 N/A N/A (4)
Long Beach RV Resort & Campground(2)
RV Barnegat NJ 175 39 100.0 % 100.0 %
Shady Pines MH Galloway Twp. NJ 39 - 100.0 % 100.0 %
Shady Pines RV Resort(2)
RV Galloway Twp. NJ 64 31 100.0 % 100.0 %
Sun Retreats Avalon(2)
RV Cape May Court House NJ 340 188 100.0 % 100.0 %
Sun Retreats Cape May(2)
RV Cape May NJ 435 240 100.0 % 100.0 %
Sun Retreats Cape May Wildwood(2)
RV Cape May NJ 438 191 100.0 % 100.0 %
Sun Retreats Pleasant Acres Farm(2)
RV Sussex NJ 153 139 100.0 % N/A (4)
New Jersey Total 2,554 1,436 100.0 % 100.0 %
New York
Adirondack Gateway RV Resort & Campground(2)
RV Gansevoort NY 323 19 100.0 % 100.0 %
Cherrywood MH Clinton NY 176 - 88.6 % (1)
83.5 % (1)
Jellystone Park™ at Birchwood Acres MH Greenfield Park NY 1 - 100.0 % 100.0 %
SUN COMMUNITIES, INC.
Property Name MH/RV City State MH and Annual RV Sites as of 12/31/2021
Transient RV Sites as of 12/31/2021
Occupancy as of 12/31/2021
Occupancy as of 12/31/2020
Jellystone Park™ at Birchwood Acres RV Resort(2)
RV Greenfield Park NY 120 184 100.0 % 100.0 %
Jellystone Park™ at Gardiner(2)
RV Gardiner NY 20 318 100.0 % N/A
Jellystone Park™ of Western New York(2)
RV North Java NY 22 337 100.0 % 100.0 %
Kittatinny Campground & RV Resort(2)
RV Barryville NY - 527 N/A N/A
Parkside Village MH Cheektowaga NY 156 - 100.0 % 100.0 %
Sky Harbor MH Cheektowaga NY 522 - 98.7 % 98.1 %
Sun Outdoors Association Island(2)
RV Henderson NY 26 274 100.0 % N/A (4)
The Villas at Calla Pointe MH Cheektowaga NY 116 - 100.0 % 100.0 %
New York Total 1,482 1,659 98.2 % 97.3 %
OTHER
Sun Outdoors Orange Beach(2)
RV Orange Beach AL - 167 N/A N/A
Fort Dupont RV Delaware City DE - - N/A N/A (4)
High Point Park MH Frederica DE 409 - 97.6 % 99.3 %
Leisure Point Resort MH Millsboro DE 202 - 94.1 % 90.6 %
Leisure Point RV Resort(2)
RV Millsboro DE 299 2 100.0 % 100.0 %
Sea Air Village MH Rehoboth Beach DE 379 - 98.9 % 99.2 %
Sea Air Village RV Resort(2)
RV Rehoboth Beach DE 123 11 100.0 % 100.0 %
Sun Outdoors Rehoboth Bay(2)
RV Millsboro DE - 291 N/A N/A
Countryside Village of Atlanta MH Lawrenceville GA 261 - 100.0 % 99.6 %
Countryside Village of Gwinnett MH Buford GA 331 - 99.1 % 99.7 %
Countryside Village of Lake Lanier MH Buford GA 548 - 98.7 % 99.1 %
Wymberly MH Martinez GA 274 - 78.1 % (1)
100.0 %
Autumn Ridge MH Ankeny IA 413 - 98.8 % 98.1 %
Jellystone Park™ of Chicago(2)
RV Millbrook IL 144 250 100.0 % N/A (4)
Maple Brook MH Matteson IL 441 - 99.8 % 99.8 %
Oak Ridge MH Manteno IL 426 - 98.1 % 96.0 %
Sun Retreats Rock River(2)
RV Hillsdale IL 243 255 100.0 % 100.0 %
Wildwood Community MH Sandwich IL 476 - 98.9 % 98.9 %
Jellystone Park™ at Mammoth Cave(2)
RV Cave City KY - 315 N/A N/A (4)
Reunion Lake RV Resort(2)
RV Ponchatoula LA - 334 N/A N/A
Campers Haven RV Resort(2)
RV Dennisport MA 221 45 100.0 % 100.0 %
Peter's Pond RV Resort(2)
RV Sandwich MA 341 65 100.0 % 100.0 %
Sun Outdoors Cape Cod(2)
RV East Falmouth MA 56 199 100.0 % 100.0 %
Hyde Park MH Easton MD 240 - 99.2 % 99.2 %
Jellystone Park™ at Maryland(2)
RV Williamsport MD - 228 N/A N/A
Southside Landing MH Cambridge MD 96 - 93.8 % 88.5 %
Sun Outdoors Frontier Town(2)
RV Berlin MD - 685 N/A N/A
Sun Outdoors Ocean City(2)
RV Berlin MD 1 392 100.0 % 100.0 %
Sun Outdoors Ocean City Gateway(2)
RV Whaleyville MD - 210 N/A N/A
Southern Hills / Northridge Place MH Stewartville MN 475 - 97.5 % 98.9 %
Jellystone Park™ at Memphis(2)
RV Horn Lake MS - 155 N/A N/A
Rocky Mountain RV Park(2)
RV Gardiner MT - 75 N/A N/A (4)
Coastal Estates MH Hampstead NC 154 - 72.1 % (1)
65.6 % (1)
Fort Tatham RV Resort & Campground(2)
RV Sylva NC 58 32 100.0 % 100.0 %
Glen Laurel MH Concord NC 260 - 98.8 % 100.0 %
Jellystone Park™ at Golden Valley(2)
RV Bostic NC - 298 N/A N/A
Meadowbrook MH Charlotte NC 321 - 99.7 % 99.7 %
Sun Villa Estates MH Reno NV 324 - 100.0 % 100.0 %
Country Village Estates MH Oregon City OR 518 - 100.0 % 99.8 %
Crown Villa RV Resort(2)
RV Bend OR - 123 N/A N/A
SUN COMMUNITIES, INC.
Property Name MH/RV City State MH and Annual RV Sites as of 12/31/2021
Transient RV Sites as of 12/31/2021
Occupancy as of 12/31/2021
Occupancy as of 12/31/2020
Forest Meadows MH Philomath OR 75 - 100.0 % 100.0 %
Oceanside RV Resort & Campground(2)
RV Coos Bay OR - 86 N/A N/A
Pheasant Ridge RV Park(2)
RV Wilsonville OR - 130 N/A N/A (4)
Woodland Park Estates MH Eugene OR 398 - 100.0 % 100.0 %
Countryside Estates MH Mckean PA 304 - 97.0 % 96.4 %
Jellystone Park™ at Quarryville(2)
RV Quarryville PA - 257 N/A N/A
Pheasant Ridge MH Lancaster PA 553 - 100.0 % 100.0 %
River Beach Campsites & RV RV Milford PA - - N/A (1)
N/A (4)
Sun Outdoors Lancaster County(2)
RV Narvon PA 280 142 100.0 % 100.0 %
Carolina Pines RV Resort(2)
RV Conway SC 163 671 100.0 % 100.0 %
Country Lakes MH Little River SC 136 - 100.0 % 95.6 %
Crossroads MH Aiken SC 168 - 73.2 % (1)
60.8 % (1)
Crossroads RV Resort(2)
RV Aiken SC 20 2 100.0 % 100.0 %
Lakeside Crossing MH Conway SC 691 - 88.4 % (1)
82.9 % (1)
Ocean Pines MH Garden City SC 579 - 99.8 % 99.5 %
Southern Palms MH Ladson SC 194 - 100.0 %
100.0 %
Bell Crossing MH Clarksville TN 237 - 99.2 % 99.6 %
Sun Outdoors Pigeon Forge(2)
RV Sevierville TN 70 238 100.0 % 100.0 %
Archview RV Resort & Campground(2)
RV Moab UT - 113 N/A N/A
Blue Water Beach Resort(2)
RV Garden City UT - 177 N/A N/A (4)
Canyonlands RV Resort & Campground(2)
RV Moab UT - 131 N/A N/A
Moab Valley RV Resort & Campground(2)
RV Moab UT - 131 N/A N/A
Pony Express RV Resort & Campground(2)
RV North Salt Lake UT - 185 N/A N/A
Slickrock RV Resort & Campground(2)
RV Moab UT - 190 N/A N/A
47 North MH Cle Elum WA - - N/A (1)
N/A (4)
Beachwood Resort(2)
RV Blaine WA 372 300 100.0 % N/A (4)
Gig Harbor RV Resort(2)
RV Gig Harbor WA - 112 N/A N/A
Fond du Lac East / Kettle Moraine KOA(2)
RV Glenbeulah WI 231 94 100.0 % 100.0 %
Thunderhill Estates MH Sturgeon Bay WI 266 - 96.6 % 97.0 %
Other Total 12,771 7,091 97.4 % 96.3 %
US TOTAL / AVERAGE 124,798 28,973 97.3 % 97.3 %
CANADA
Arran Lake RV Resort & Campground(2)
RV Allenford ON 185 5 100.0 % 100.0 %
Craigleith RV Resort & Campground(2)
RV Clarksburg ON 85 26 100.0 % 100.0 %
Deer Lake RV Resort & Campground(2)
RV Huntsville ON 210 31 100.0 % 100.0 %
Grand Oaks RV Resort & Campground(2)
RV Cayuga ON 248 40 100.0 % 100.0 %
Gulliver's Lake RV Resort & Campground RV Millgrove ON 198 - 100.0 % 100.0 %
Hidden Valley RV Resort & Campground(2)
RV Normandale ON 205 40 100.0 % 100.0 %
Lafontaine RV Resort & Campground(2)
RV Tiny ON 215 48 100.0 % 100.0 %
Lake Avenue RV Resort & Campground(2)
RV Cherry Valley ON 125 11 100.0 % 100.0 %
Pickerel Park RV Resort & Campground(2)
RV Napanee ON 167 42 100.0 % 100.0 %
Pleasant Beach Campground(2)
RV Sherkston ON 87 15 100.0 % N/A (4)
Sherkston Shores Beach Resort & Campground(2)
RV Sherkston ON 1,575 360 100.0 % 100.0 %
Silver Birches RV Resort & Campground(2)
RV Lambton Shores ON 139 23 100.0 % 100.0 %
Trailside RV Resort & Campground(2)
RV Seguin ON 217 20 100.0 % 100.0 %
Willow Lake RV Resort & Campground(2)
RV Scotland ON 369 4 100.0 % 100.0 %
Willowood RV Resort & Campground(2)
RV Amherstburg ON 143 184 100.0 % 100.0 %
Woodland Lake RV Resort & Campground(2)
RV Bornholm ON 195 25 100.0 % 100.0 %
CANADA TOTAL / AVERAGE 4,363 874 100.0 % 100.0 %
SUN COMMUNITIES, INC.
Property Name MH/RV City State MH and Annual RV Sites as of 12/31/2021
Transient RV Sites as of 12/31/2021
Occupancy as of 12/31/2021
Occupancy as of 12/31/2020
COMPANY TOTAL / AVERAGE 129,161 29,847 97.4 % 97.3 %
(1)Occupancy in these properties reflects the fact that these properties are in a lease-up phase following an expansion, redevelopment or initial construction.
(2)Occupancy percentage excludes transient RV sites. Percentage calculated by dividing revenue producing sites by developed sites. A revenue producing site is defined as a site that is occupied by a paying resident or reserved by a customer with annual or seasonal usage rights. A developed site is defined as an adequate sized parcel of land that has road and utility access which is zoned and licensed (if required) for use as a home site.
(3)We have an ownership interest in Sunset Beach, Strafford and Chincoteague Island, but do not maintain and operate the property.
(4)No occupancy in these properties for the year ended December 31, 2020 as properties were acquired during the year ended December 31, 2021.
(5)Occupancy in these properties at December 31, 2021 and 2020 reflects the redevelopment following asset impairments resulting from Hurricane Irma in September 2017.
The following tables set forth certain information relating to our Safe Harbor branded marinas as of December 31, 2021.
Marina Property Name City State / Municipal Wet Slips and Dry Storage Spaces
as of 12/31/2021
Wet Slips and Dry Storage Spaces
as of 12/31/2020
UNITED STATES
NORTHEAST
Connecticut
Bruce & Johnsons Branford CT 664 664
Dauntless(1)
Essex CT 332 332
Dauntless Shipyard(1)
Essex CT - -
Deep River Deep River CT 310 310
Essex Island(1)
Essex CT - -
Ferry Point Old Saybrook CT 138 138
Harbor House(2)
Stamford CT - -
Mystic Mystic CT 253 253
Pilots Point Westbrook CT 879 879
Stratford Stratford CT 210 210
Yacht Haven(2)
Stamford CT 513 513
Connecticut Total 3,299 3,299
Rhode Island
Allen Harbor(3)
North Kingstown RI 183 N/A
Cove Haven Barrington RI 346 346
Cowesett(8)
Warwick RI 1,178 1,178
Greenwich Bay Warwick RI 545 545
Island Park(4)
Portsmouth RI - -
Jamestown Boatyard Jamestown RI 132 132
New England Boatworks Portsmouth RI 229 229
Newport Shipyard Newport RI 75 75
Sakonnet(4)
Portsmouth RI 445 445
Silver Spring South Kingstown RI 100 100
Wickford(5)
North Kingstown RI - -
Wickford Cove(5)
North Kingstown RI 252 252
Rhode Island Total 3,485 3,302
New York
Capri Port Washington NY 369 369
Gaines Rouses Point NY 272 272
Glen Cove Glen Cove NY 540 540
Greenport(6)
Greenport NY 414 414
SUN COMMUNITIES, INC.
Marina Property Name City State / Municipal Wet Slips and Dry Storage Spaces
as of 12/31/2021
Wet Slips and Dry Storage Spaces
as of 12/31/2020
Haverstraw West Haverstraw NY 921 921
Post Road Mamaroneck NY 46 46
Stirling(6)
Greenport NY - -
Willsboro Bay Willsboro NY 221 221
New York Total 2,783 2,783
Massachusetts
Edgartown(3)
Edgartown MA 161 N/A
Fiddler's Cove North Falmouth MA 229 229
Green Harbor Marshfield MA 203 203
Hawthorne Cove Salem MA 425 425
Marina Bay Quincy MA 710 710
Onset Bay Buzzards Bay MA 231 231
Plymouth Plymouth MA 197 197
Sunset Bay Hull MA 241 241
Vineyard Haven(3)
Vineyard Haven MA 149 N/A
Massachusetts Total 2,546 2,236
Maryland
Annapolis Annapolis MD 391 391
Bohemia Vista Chesapeake Bay MD 125 125
Carroll Island Baltimore MD 479 479
Great Oak Landing Chestertown MD 391 391
Hacks Point Earleville MD 72 72
Narrows Point Grasonville MD 569 569
Oxford Oxford MD 135 135
Podickory Point(3)
Annapolis MD 236 N/A
Zahnisers Solomons MD 247 247
Maryland Total 2,645 2,409
New Jersey
Crystal Point Point Pleasant NJ 284 284
Manasquan River Brick Township NJ 234 234
New Jersey Total 518 518
Maine
Great Island Harpswell ME 157 157
Rockland Rockland ME 13 13
Maine Total 170 170
New Hampshire
Wentworth by the Sea(3)
New Castle NH 231 N/A
New Hampshire Total 231 N/A
Vermont
Shelburne Shipyard Shelburne VT 174 174
Vermont Total 174 174
SOUTH
Georgia
Aqualand Flowery Branch GA 1,625 1,625
Bahia Bleu Thunderbolt GA 259 259
SUN COMMUNITIES, INC.
Marina Property Name City State / Municipal Wet Slips and Dry Storage Spaces
as of 12/31/2021
Wet Slips and Dry Storage Spaces
as of 12/31/2020
Hideaway Bay Flowery Branch GA 635 635
Trade Winds Appling GA 314 314
Georgia Total 2,833 2,833
Kentucky
Beaver Creek Monticello KY 356 356
Burnside Somerset KY 347 347
Grider Hill Albany KY 704 704
Jamestown Jamestown KY 707 707
Wisdom Dock Albany KY 291 291
Kentucky Total 2,405 2,405
Texas
Emerald Point Austin TX 651 651
Pier 121 Lewisville TX 1,082 1,082
Walden Montgomery TX 391 391
Texas Total 2,124 2,124
Arkansas
Brady Mountain Royal AR 582 582
Arkansas Total 582 582
Tennessee
Eagle Cove Byrdstown TN 78 78
Holly Creek Celina TN 306 306
Tennessee Total 384 384
Mississippi
Aqua Yacht Iuka MS 587 587
Mississippi Total 587 587
Alabama
Sportsman Orange Beach AL 729 729
Alabama Total 729 729
Oklahoma
Harbors View Afton OK 172 172
Oklahoma Total 172 172
SOUTHEAST
Florida
Angler House(3)
Islamorada FL 22 N/A
Burnt Store Punta Gorda FL 975 975
Calusa Island Goodland FL 620 620
Cape Harbour Cape Coral FL 256 256
Emerald Coast(3)
Niceville FL 408 N/A
Harborage Yacht Club(3)
Stuart FL 297 N/A
Harbortown Fort Pierce FL 350 350
Islamorada(3)
Islamorada FL 267 N/A
Lauderdale Marine Center(3)
Fort Lauderdale FL 101 N/A
Marathon(3)
Marathon FL 153 N/A
New Port Cove Riviera Beach FL 362 362
SUN COMMUNITIES, INC.
Marina Property Name City State / Municipal Wet Slips and Dry Storage Spaces
as of 12/31/2021
Wet Slips and Dry Storage Spaces
as of 12/31/2020
North Palm Beach North Palm Beach FL 110 110
Old Port Cove North Palm Beach FL 208 208
Pier 77 Bradenton FL 199 199
Pineland Bokeelia FL 259 259
Regatta Pointe Palmetto FL 367 367
Riviera Beach Riviera Beach FL 20 20
Siesta Key Sarasota FL 198 198
South Fork(7)
Fort Lauderdale FL - -
West Palm Beach West Palm Beach FL 61 61
Florida Total 5,233 3,985
South Carolina
Beaufort Beaufort SC 124 124
Bristol Charleston SC 249 249
Charleston City(9)
Charleston SC 450 450
City Boatyard Charleston SC 213 213
Port Royal(3)
Port Royal SC 252 N/A
Port Royal Landing Port Royal SC 161 161
Reserve Harbor Pawleys Island SC 239 239
Skull Creek Hilton Head SC 186 186
South Carolina Total 1,874 1,622
North Carolina
Kings Point Cornelius NC 784 784
Peninsula Yacht Club Cornelius NC 476 476
Skippers Landing Troutman NC 389 389
South Harbour Village Southport NC 146 146
Westport Denver NC 587 587
North Carolina Total 2,382 2,382
Virginia
Stingray Point(3)
Deltaville VA 228 N/A
Virginia Total 228 N/A
MIDWEST
Michigan
Belle Maer Harrison Township MI 542 542
Detroit River(3)
Detroit MI 473 N/A
Grand Isle Grand Haven MI 450 450
Great Lakes Muskegon MI 466 466
Jefferson Beach St. Clair Shores MI 898 898
Toledo Beach La Salle Township MI 363 363
Michigan Total 3,192 2,719
Ohio
Lakefront Port Clinton OH 477 477
Sandusky Sandusky OH 550 550
Ohio Total 1,027 1,027
WEST
California
Anacapa Isle Oxnard CA 450 450
SUN COMMUNITIES, INC.
Marina Property Name City State / Municipal Wet Slips and Dry Storage Spaces
as of 12/31/2021
Wet Slips and Dry Storage Spaces
as of 12/31/2020
Ballena Isle Alameda CA 414 414
Cabrillo Isle San Diego CA 527 N/A
Emeryville Emeryville CA 460 460
Loch Lomond San Rafael CA 529 529
Shelter Island(3)
San Diego CA 60 N/A
South Bay(3)
Chula Vista CA 413 N/A
Sunroad(3)
San Diego CA 643 N/A
Ventura Isle Ventura CA 444 444
California Total 3,940 2,297
US TOTAL 43,543 38,739
PUERTO RICO
Puerto del Rey(3)
Fajardo PR 1,612 N/A
PUERTO RICO TOTAL 1,612 N/A
COMPANY TOTAL 45,155 38,739
(1)Wet slips and dry storage spaces from Dauntless Shipyard and Essex Island are grouped into Dauntless.
(2)Wet slips and dry storage spaces from Harbor House are grouped into Yacht Haven.
(3)Property acquired during year ended December 31, 2021.
(4)Wet slips and dry storage spaces from Island Park are grouped into Sakonnet.
(5)Wet slips and dry storage spaces from Wickford are grouped into Wickford Cove.
(6)Wet slips and dry storage spaces from Stirling are grouped into Greenport.
(7)Property currently under development.
(8)Wet slips and dry storage spaces from Apponaug Harbor are grouped into Cowesett.
(9)Wet slips and dry storage spaces from Ashley Fuels are grouped into Charleston City.
SUN COMMUNITIES, INC.

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ITEM 3. LEGAL PROCEEDINGS
ITEM 3. LEGAL PROCEEDINGS
Legal Proceedings Arising in the Ordinary Course of Business
We are involved in various legal proceedings arising in the ordinary course of business. All such proceedings, taken together, are not expected to have a material adverse impact on our results of operations or financial condition.
Environmental Matters
Item 103 of SEC Regulation S-K requires disclosure of certain environmental matters when a governmental authority is a party to the proceedings and such proceedings involve potential monetary sanctions that we reasonably believe will exceed an applied threshold not to exceed $1.0 million. Applying this threshold, there are no environmental matters to disclose for the year ended December 31, 2021.

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ITEM 4. MINE SAFETY DISCLOSURE
ITEM 4. MINE SAFETY DISCLOSURES
None.
SUN COMMUNITIES, INC.
PART II

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ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
Market Information
Our common stock has been listed on the NYSE since December 8, 1993, and trades under the symbol "SUI." On February 15, 2022, the closing share price of our common stock was $190.55 per share on the NYSE, and there were 484 holders of record for the 115,961,958 outstanding shares of common stock.
On February 15, 2022, the following OP units of the Operating Partnership were outstanding:
OP Units OP Units
Issued and Outstanding Exchangeable
Shares of Common Stock
Aspen preferred OP units 1,283,819 388,070
Series A-1 preferred OP units 273,524 667,132
Series A-3 preferred OP units 40,268 74,917
Series C preferred OP units 306,013 339,674
Series D preferred OP units 488,958 391,166
Series E preferred OP units 85,000 58,621
Series F preferred OP units 90,000 56,250
Series G preferred OP units 240,710 155,297
Series H preferred OP units 581,407 354,516
Series I preferred OP units 922,000 562,195
Series J preferred OP units 240,000 145,455
Common OP units 2,552,378 2,552,378
Total 7,104,077 5,745,671
We have historically paid regular quarterly distributions to holders of our common stock and common OP units. In addition, we are obligated to make distributions to holders of shares of Aspen preferred OP units, Series A-1 preferred OP units, Series C preferred OP units, Series D preferred OP units, Series E preferred OP units, Series F preferred OP units, Series G preferred OP units, Series H preferred OP units, Series I preferred OP units, Series J preferred OP units, and Series A-3 preferred OP units. See "Structure of the Company" under Part I, Item 1 of this Annual Report on Form 10-K. Our ability to make distributions on our common stock and preferred OP units, payments on our indebtedness and to fund planned capital expenditures will depend on our ability to generate cash in the future. The decision to declare and pay distributions on shares of our common stock and common OP units in the future, as well as the timing, amount and composition of any such future distributions, will be at the sole discretion of our Board of Directors in light of conditions then existing, including our earnings, financial condition, capital requirements, debt maturities, the availability of debt and equity capital, applicable REIT and legal restrictions, general overall economic conditions and other factors.
Securities Authorized for Issuance Under Equity Compensation Plans
The following table reflects information about the securities authorized for issuance under our equity compensation plans as of December 31, 2021:
Number of securities to be issued upon exercise of outstanding options, warrants and rights Weighted-average exercise price of outstanding options, warrants and rights Number of shares of common stock remaining available for future issuance under equity compensation plans (excluding securities reflected in column a)
Plan Category (a) (b) (c)
Equity compensation plans approved by stockholders - $ - 627,632
Total
- $ - 627,632
SUN COMMUNITIES, INC.
Recent Sales of Unregistered Securities
From time to time, we may issue shares of common stock in exchange for OP units that may be tendered to the Operating Partnership for redemption in accordance with the terms and provisions of the limited partnership agreement of the Operating Partnership. Such shares are issued based on the exchange ratios and formulas described in "Structure of the Company" under Part I, Item 1 of this Annual Report on Form 10-K. Below is the activity of conversions for the quarter and year ended December 31, 2021:
Three Months Ended Year Ended
December 31, 2021 December 31, 2021
OP Units Conversion Rate Units / Shares Common Stock Units / Shares Common Stock
Common OP units 1.0000 7,640 7,640 86,364 86,364
Series A-1 preferred OP units 2.4390 414 1,009 19,710 48,067
Series C preferred OP units 1.1100 140 155 140 155
All of the securities described above were issued in private placements in reliance on Section 4(a)(2) of the Securities Act, including Regulation D promulgated thereunder, based on certain investment representations made by the parties to whom the securities were issued. No underwriters were used in connection with any of such issuances.
Purchases of Equity Securities
Common stock repurchases during the three months ended December 31, 2021 were:
Total number of
shares purchased Average price
paid per share Total number of shares purchased as part of publicly announced plans or programs Maximum number (or approximate dollar value) of shares that may yet be purchased under the plans or programs
Period (a) (b) (c) (d)
October 1, 2021 - October 31, 2021 4,961 $ 195.04 - $ -
November 1, 2021 - November 30, 2021 783 $ 195.13 - $ -
December 1, 2021 - December 31, 2021 - $ - - $ -
Total 5,744 $ 195.05 - $ -
During the three months ended December 31, 2021, we withheld 5,744 shares from employees to satisfy estimated statutory income tax obligations related to vesting of restricted stock awards. The value of the common stock withheld was based on the closing price of our common stock on the applicable vesting date.
Performance Graph
Set forth below is a line graph comparing the yearly percentage change in the cumulative total shareholder return on our common stock against the cumulative total return of a broad market index composed of all issuers listed on the NYSE and an industry index comprised of 13 publicly traded REITs, for the five year period ending on December 31, 2021. This line graph assumes a $100.00 investment on December 31, 2016, a reinvestment of distributions and actual increase of the market value of our common stock relative to an initial investment of $100.00. The comparisons in this table are required by the SEC and are not intended to forecast or be indicative of possible future performance of our common stock.
SUN COMMUNITIES, INC.
Peer Group
We utilize peer group data for quantitative benchmarking against external market participants. We select our peer group based on a number of quantitative and qualitative factors including, but not limited to, revenues, total assets, market capitalization, industry, sub-industry, location, total shareholder return history, executive compensation components and peer decisions made by other companies. From time to time, we update our peer group based on analysis of the aforementioned factors and application of judgment.
Year Ended
Index December 31, 2016 December 31, 2017 December 31, 2018 December 31, 2019 December 31, 2020 December 31, 2021
Sun Communities, Inc. $ 100.00 $ 124.94 $ 141.05 $ 212.86 $ 220.49 $ 310.43
Dow Jones U.S. Real Estate Residential Index $ 100.00 $ 106.44 $ 109.94 $ 143.84 $ 129.07 $ 204.42
NYSE Composite Index $ 100.00 $ 118.73 $ 108.10 $ 135.68 $ 145.16 $ 175.17
SUI Peer Group(1)
$ 100.00 $ 106.93 $ 106.28 $ 134.00 $ 122.70 $ 204.19
(1)SUI peer group includes: American Campus Communities, Inc., Apartment Investment and Management Company, AvalonBay Communities, Inc., Camden Property Trust, CubeSmart, Equity Lifestyles Properties, Inc., Essex Property Trust, Inc., Extra Space Storage Inc., Federal Realty Investment Trust, Invitation Homes, Inc., Mid-America Apartment Communities, Inc., The Macerich Company and UDR, Inc.
The information included under the heading "Performance Graph" is not to be treated as "soliciting material" or as "filed" with the SEC, and is not incorporated by reference into any filing by the Company under the Securities Act or the Exchange Act that is made on, before or after the date of filing of this Annual Report on Form 10-K.
SUN COMMUNITIES, INC.

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ITEM 6. SELECTED FINANCIAL DATA
ITEM 6. [Reserved]
SUN COMMUNITIES, INC.

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ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis of the consolidated financial condition and results of operations should be read in conjunction with the Consolidated Financial Statements and accompanying footnotes thereto included in this Annual Report on Form 10-K. In addition to the results presented in accordance with GAAP below, we have provided NOI and FFO as supplemental performance measures. Refer to Non-GAAP Financial Measures in this Item 7 for additional information.
OVERVIEW
We are a fully integrated REIT. As of December 31, 2021, we owned and operated, directly or indirectly, or had an interest in, a portfolio of 602 developed properties located in 39 states throughout the United States, Ontario, Canada and Puerto Rico, including 284 MH communities, 160 RV resorts, 33 properties containing both MH and RV sites, and 125 marinas. We have been in the business of acquiring, operating, developing and expanding MH communities and RV resorts since 1975 and marinas since 2020. We lease individual sites with utilities access for placement of manufactured homes, RVs or boats to our customers. We are also engaged in the marketing, selling and leasing of new and pre-owned homes to current and future residents in our MH communities. The Rental Program operations within our MH communities support and enhance our occupancy levels, property performance and cash flows.
COVID-19 IMPACT
The impact of COVID-19 in 2021 was minimal compared to 2020.
In response to the COVID-19 pandemic, we continue to provide essential services using social distancing techniques and minimal contact. To promote social distancing, we are encouraging our residents to use our online rent payment portals and other payment methods. We continue to follow the numerous health and safety measures we previously implemented at our communities and our main office to keep team members safe. These measures include increased cleaning and sanitation of shared spaces and social distancing protocols throughout our footprint. We closely monitor and track orders by federal, state and local authorities, provide status updates to our operations and main office leadership teams, and adjust our operating processes accordingly. We have implemented and continue to encourage remote working arrangements, wherever possible, to keep our team members safe and to do our part to promote social distancing.
The extent to which the COVID-19 pandemic impacts our operations, financial condition and financial results will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the scope, severity and duration of the pandemic, the actions taken to contain the pandemic or mitigate its impact, and the direct and indirect economic effects of the pandemic and containment measures, among others. The uncertainty of this situation precludes any prediction as to the full impact of the COVID-19 pandemic.
SUN COMMUNITIES, INC.
EXECUTIVE SUMMARY
2021 General Overview
•Total revenues for 2021 increased 62.5 percent to $2.3 billion.
•Core FFO for 2021 was $6.51 per diluted share and OP unit, an increase of 27.9 percent over 2020.
•Achieved MH and RV real property Same Community NOI growth of 11.2 percent over 2020.
•Attained MH and RV Same Community occupancy of 98.9 percent.
•Home sales volume increased 42.6 percent to 4,088 homes in 2021 as compared to 2,866 in 2020.
•Brokered homes sales increased by 38.0 percent to 3,528 in 2021 as compared to 2,557 in 2020.
•Achieved 1-year, 3-year and 5-year total shareholder return of 40.8 percent, 120.1 percent and 210.3 percent, respectively, outperforming or in-line with the MSCI US REIT, Russell 1000, U.S. REIT Residential and S&P 500 indexes.
•We acquired 54 properties, totaling over 16,800 sites, wet slips and dry storage spaces, and sites for expansion for a total purchase price of $1.4 billion.
•Completed the construction of over 1,030 total sites at eight ground-up developments and re-development properties.
•Delivered nearly 580 total expansion sites in 11 MH and RV properties.
•Successfully integrated Safe Harbor, which contributed 16.5 percent of the real property NOI - Total Portfolio in 2021.
•Received investment grade ratings of BBB and Baa3 with a stable outlook from S&P Global and Moody's, respectively, which provides us with an additional source of financing.
•Closed two underwritten senior unsecured note offerings for aggregate net proceeds of approximately $1.2 billion.
•Closed an underwritten registered public offering, in which we sold 4,000,000 shares of our common stock and completed a forward sale agreement for an additional 4,050,000 shares of our common stock, for net proceeds of approximately $1.1 billion.
•Completed two forward sale agreements relating to an underwritten registered public offering of 4,025,000 shares of our common stock at a public offering price of $185.00 per share.
•Entered into a definitive agreement to acquire Park Holidays, the second largest owner and operator of holiday communities in the United Kingdom for approximately £950.0 million, or $1.3 billion.
Property Operations
Occupancy in our MH and annual RV properties, as well as our ability to increase rental rates, directly affect revenues. Our revenue streams are predominantly derived from customers renting our sites on a long-term basis. Our Same Community properties continue to achieve revenue and occupancy increases which drive continued NOI growth. Our home sales in our communities remained strong in 2021 and we expect this trend to continue.
Year Ended
Portfolio Information: December 31, 2021 December 31, 2020 December 31, 2019
Occupancy % - Total Portfolio - MH and Annual RV blended(1)
97.4 % 97.3 % 96.4 %
Occupancy % - Same Community - Adjusted MH and Annual RV blended(1)(2)(3)
98.9 % 97.5 % 97.0 %
Core FFO per share $ 6.51 $ 5.09 $ 4.92
Real property NOI - Total Portfolio (in thousands)
$ 982,123 $ 721,302 $ 649,706
Real property NOI - Same Community (in thousands) - MH and RV
$ 763,389 $ 658,431 $ 630,672
Homes sales volume 4,088 2,866 3,439
(1) Occupancy percent includes annual RV sites and excludes transient RV sites.
(2) Occupancy percent excludes recently completed but vacant expansion sites.
(3) Same Community is based on the as reported year end Same Community count for each respective year.
SUN COMMUNITIES, INC.
Acquisition Activity
During the past three years, we have completed acquisitions of over 225 properties with over 28,500 sites and over 45,000 wet slips and dry storage spaces located in high growth areas and retirement and vacation destinations such as California, Florida, Texas, Arizona and coastal areas in the Eastern United States.
During 2021, we acquired 35(1) MH communities and RV resorts, and 19(1) marinas, as detailed below:
MH & RV Property Name(1)
Property Type Sites, Wet Slips, and Dry Storage Spaces State Month Acquired
Sun Outdoors Association Island RV 294 NY January
Blue Water Beach Resort RV 177 UT February
Tranquility MHC MH 25 FL February
Islamorada and Angler House Marina 251 FL February
Prime Martha's Vineyard Marina 395 MA March
Pleasant Beach Campground RV 102 ON, Canada March
Sun Outdoors Cape Charles RV 669 VA March
Beachwood Resort RV 672 WA March
ThemeWorld RV Resort RV 148 FL April
Sylvan Glen Estates MH 476 MI April
Shelter Island Boatyard Marina 52 CA May
Lauderdale Marine Center Marina 206 FL May
Apponaug Harbor Marina 348 RI June
Cabrillo Isle Marina 476 CA June
Marathon Marina 135 FL June
Allen Harbor Marina 176 RI July
Cisco Grove Campground & RV(2)
RV 18 CA July
Four Leaf Portfolio(3)
MH 2,545 MI / IN July
Harborage Yacht Club Marina 300 FL July
Zeman Portfolio RV 686 IL / NJ July
Southern Leisure RV Resort RV 496 FL August
Sunroad Marina Marina 617 CA August
Lazy Lakes RV Resort RV 99 FL August
Puerto del Rey Marina 1,746 Puerto Rico September
Stingray Point Marina 222 VA September
Detroit River Marina 440 MI September
Jetstream RV Resort at NASA RV 202 TX September
Beaver Brook Campground(4)
RV 204 ME October
Emerald Coast Marina 311 FL November
Tall Pines Harbor Campground RV 241 VA November
Wells Beach Resort Campground RV 231 ME November
Port Royal Marina 167 SC November
Podickory Point Marina 209 MD December
Jellystone Park at Mammoth Cave RV 315 KY December
South Bay Marina 333 CA December
Wentworth by the Sea Marina 155 NH December
Rocky Mountain RV Park RV 75 MT December
Haas Lake RV Park Campground RV 492 MI December
Pearwood RV Resort RV 144 TX December
Holly Shores Camping Resort RV 310 NJ December
Pheasant Ridge RV Park RV 130 OR December
Coyote Ranch Resort(5)
RV 165 TX December
Jellystone Park at Whispering Pines RV 131 TX December
SUN COMMUNITIES, INC.
MH & RV Property Name(1)
Property Type Sites, Wet Slips, and Dry Storage Spaces State Month Acquired
Hospitality Creek Campground RV 230 NJ December
Total 15,816
(1) Refer to Note 3, "Real Estate Acquisitions and Dispositions," for additional detail on the acquisition of MH, RV and marina properties.
(2) Contains 407 development sites.
(3) Contains 340 development sites.
(4) Contains 150 development sites.
(5) Contains 165 development sites.
Disposition Activity
On July 2, 2021, we sold two MH communities located in Indiana and Missouri, containing a combined 677 sites, for $67.5 million. The gain from the sale of the property was approximately $49.4 million.
On August 26, 2021, we sold four MH communities located in Arizona, Illinois and Missouri, containing a combined 1,137 sites, for $94.6 million. The gain from the sale of the property was approximately $58.7 million.
Construction Activity
Ground-up Developments - During the year ended December 31, 2021, we constructed over 1,000 total sites at seven ground-up development properties and one re-development located in California, Colorado, Texas, Florida, North Carolina and South Carolina.
Expansions - We have been focused on expansion opportunities adjacent to our existing properties, and we have developed over 2,100 sites within the past three years. We have expanded nearly 580 total sites at 11 MH and RV properties in 2021.
We continue to expand our properties utilizing our inventory of owned and entitled land. We have 10,672 MH and RV sites suitable for future development.
Markets
Our MH and RV properties are largely concentrated in Florida, Michigan, Texas and California, which contain 62.6 percent of our total MH and RV sites. We have expanded our market share in multiple states through recent acquisitions and increased our property holdings in high growth areas of the U.S. including retirement and vacation destinations.
We have also experienced strong revenue growth through recent acquisitions of RV resorts. The age demographic of RV resorts is attractive, as the population of retirement age adults in the U.S. is growing. RV resorts have become a trending vacation opportunity not only for the retiree population, but as an affordable vacation alternative for families and millennials.
SUN COMMUNITIES, INC.
The following table identifies our MH and RV markets by total sites:
December 31, 2021 December 31, 2020
Major Market Number of Properties Total Sites % of Total Sites Number of Properties Total Sites % of Total Sites
Florida 132 46,733 29.4 % 128 45,814 30.7 %
Michigan 84 33,126 20.8 % 74 29,632 19.8 %
Texas 30 10,768 6.8 % 24 9,576 6.4 %
California 36 8,934 5.6 % 35 8,906 6.0 %
Arizona 12 5,308 3.3 % 14 5,660 3.8 %
Ontario, Canada 16 5,237 3.3 % 15 5,056 3.4 %
Indiana 12 4,176 2.6 % 12 4,176 2.8 %
New Jersey 11 3,990 2.5 % 8 3,160 2.1 %
Colorado 10 3,539 2.2 % 10 3,415 2.3 %
Virginia 10 3,435 2.2 % 8 1,875 1.3 %
Maine 15 3,431 2.2 % 13 2,995 2.0 %
New York 10 3,141 2.0 % 9 2,841 1.9 %
Ohio 9 2,925 1.8 % 9 2,925 2.0 %
South Carolina 6 2,624 1.7 % 6 2,503 1.7 %
New Hampshire 10 2,398 1.5 % 10 2,237 1.5 %
Illinois 5 2,235 1.4 % 5 2,151 1.4 %
Connecticut 16 2,005 1.3 % 16 2,005 1.3 %
Maryland 6 1,852 1.2 % 6 1,852 1.2 %
Delaware 4 1,716 1.1 % 4 1,709 1.1 %
Pennsylvania 5 1,536 1.0 % 5 1,535 1.0 %
Georgia 4 1,414 0.9 % 4 1,355 0.9 %
Oregon 6 1,330 0.8 % 5 1,200 0.8 %
North Carolina 5 1,123 0.7 % 5 1,083 0.7 %
Massachusetts 3 927 0.6 % 3 928 0.6 %
Utah 6 927 0.6 % 5 750 0.5 %
Washington 2 784 0.5 % 1 112 0.1 %
Wisconsin 2 591 0.4 % 2 588 0.4 %
Tennessee 2 545 0.3 % 2 545 0.4 %
Minnesota 1 475 0.3 % 1 475 0.3 %
Iowa 1 413 0.3 % 1 413 0.3 %
Louisiana 1 334 0.2 % 1 226 0.2 %
Nevada 1 324 0.2 % 1 324 0.2 %
Kentucky 1 315 0.2 % - - - %
Alabama 1 167 0.1 % 1 142 0.1 %
Mississippi 1 155 0.1 % 1 155 0.1 %
Montana 1 75 - % - - - %
Missouri - - - % 2 976 0.7 %
477 159,008 446 149,295
SUN COMMUNITIES, INC.
Our marinas are largely concentrated in Florida, Connecticut, Rhode Island, Massachusetts, New York, Maryland and California.
The following table identifies our marina markets by total wet slips and dry storage spaces:
December 31, 2021 December 31, 2020
Major Market Number of Properties Wet Slips Dry Storage Spaces
Total Wet Slips / Dry Storage Spaces
% Wet Slips / Dry Storage Spaces
Number of Properties Wet Slips Dry Storage Spaces
Total Wet Slips / Dry Storage Spaces
% Wet Slips / Dry Storage Spaces
Florida 20 2,701 2,532 5,233 11.6 % 14 2,038 1,947 3,985 10.3 %
California 9 3,884 56 3,940 8.7 % 5 2,297 - 2,297 5.9 %
Rhode Island 12 3,308 177 3,485 7.7 % 11 3,292 10 3,302 8.6 %
Connecticut 11 3,299 - 3,299 7.3 % 11 3,299 - 3,299 8.6 %
Michigan 6 2,637 555 3,192 7.1 % 5 2,268 451 2,719 7.0 %
Georgia 4 2,587 246 2,833 6.3 % 4 2,587 246 2,833 7.3 %
New York 8 2,783 - 2,783 6.2 % 8 2,783 - 2,783 7.2 %
Maryland 9 2,156 489 2,645 5.9 % 8 2,022 387 2,409 6.2 %
Massachusetts 9 2,045 501 2,546 5.6 % 7 1,988 248 2,236 5.8 %
Kentucky 5 2,365 40 2,405 5.3 % 5 2,365 40 2,405 6.2 %
North Carolina 5 1,081 1,301 2,382 5.3 % 5 1,081 1,301 2,382 6.1 %
Texas 3 1,841 283 2,124 4.6 % 3 1,841 283 2,124 5.5 %
South Carolina 8 1,261 613 1,874 4.1 % 7 1,249 373 1,622 4.2 %
Puerto Rico 1 987 625 1,612 3.6 % - - - - - %
Ohio 2 888 139 1,027 2.3 % 2 888 139 1,027 2.7 %
Alabama 1 81 648 729 1.6 % 1 81 648 729 1.9 %
Mississippi 1 453 134 587 1.3 % 1 453 134 587 1.5 %
Arkansas 1 582 - 582 1.3 % 1 582 - 582 1.5 %
New Jersey 2 488 30 518 1.1 % 2 488 30 518 1.3 %
Tennessee 2 384 - 384 0.9 % 2 384 - 384 1.0 %
New Hampshire 1 231 - 231 0.5 % - - - - - %
Virginia 1 228 - 228 0.5 % - - - - - %
Vermont 1 102 72 174 0.4 % 1 102 72 174 0.4 %
Oklahoma 1 172 - 172 0.4 % 1 172 - 172 0.4 %
Maine 2 170 - 170 0.4 % 2 170 - 170 0.4 %
125 36,714 8,441 45,155 106 32,430 6,309 38,739
SUN COMMUNITIES, INC.
NON-GAAP FINANCIAL MEASURES
In addition to the results reported in accordance with GAAP in our "Results of Operations" below, we have provided information regarding net operating income ("NOI") and funds from operations ("FFO") as supplemental performance measures. We believe NOI and FFO are appropriate measures given their wide use by and relevance to investors and analysts following the real estate industry. NOI provides a measure of rental operations and does not factor in depreciation, amortization and non-property specific expenses such as general and administrative expenses. FFO, reflecting the assumption that real estate values rise or fall with market conditions, principally adjusts for the effects of GAAP depreciation / amortization of real estate assets. In addition, NOI and FFO are commonly used in various ratios, pricing multiples / yields and returns and valuation calculations used to measure financial position, performance and value.
NOI is derived from operating revenues minus property operating expenses and real estate taxes. NOI is a non-GAAP financial measure that we believe 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. We use 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 our properties rather than of the Company overall.
We believe 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 our financial performance or GAAP cash flow from operating activities as a measure of our liquidity; nor is it indicative of funds available for our cash needs, including our 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.
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, real estate related impairments, 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 our 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. We also use FFO excluding certain gain and loss items that management considers unrelated to the operational and financial performance of our core business ("Core FFO"). We believe that Core FFO provides enhanced comparability for investor evaluations of period-over-period results.
We believe 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 our interpretation of standards established by NAREIT, which may not be comparable to FFO reported by other REITs that interpret the NAREIT definition differently.
SUN COMMUNITIES, INC.
RESULTS OF OPERATIONS
Summary Statements of Operations
The following tables reconcile the Net income attributable to Sun Communities, Inc. common stockholders to NOI and summarize our consolidated financial results for the years ended December 31, 2021, 2020 and 2019 (in thousands):
Year Ended
December 31, 2021 December 31, 2020 December 31, 2019
Net Income Attributable to Sun Communities, Inc. Common Stockholders $ 380,152 $ 131,614 $ 160,265
Interest income (12,232) (10,119) (17,857)
Brokerage commissions and other revenues, net (30,127) (17,230) (14,127)
General and administrative expense 181,210 109,616 92,777
Catastrophic event-related charges, net 2,239 885 1,737
Business combinations 1,362 23,008 -
Depreciation and amortization 522,745 376,876 328,067
Loss on extinguishment of debt (see Note 8)
8,127 5,209 16,505
Interest expense 158,629 129,071 133,153
Interest on mandatorily redeemable preferred OP units / equity 4,171 4,177 4,698
Gain on remeasurement of marketable securities (see Note 14)
(33,457) (6,129) (34,240)
(Gain) / loss on foreign currency translation 3,743 (7,666) (4,479)
Gain on disposition of property (108,104) (5,595) -
Other expense, net 12,122 5,188 1,701
(Gain) / loss on remeasurement of notes receivable (see Note 4)
(685) 3,275 -
Income from nonconsolidated affiliates (see Note 6)
(3,992) (1,740) (1,374)
Loss on remeasurement of investment in nonconsolidated affiliates (see Note 6)
160 1,608 -
Current tax expense (see Note 12)
1,236 790 1,095
Deferred tax (benefit) / expense (see Note 12)
91 (1,565) (222)
Preferred return to preferred OP units / equity interests 12,095 6,935 6,058
Income attributable to noncontrolling interests 21,490 8,902 9,768
Preferred stock distribution - - 1,288
NOI $ 1,120,975 $ 757,110 $ 684,813
Year Ended
December 31, 2021 December 31, 2020 December 31, 2019
Real property NOI $ 982,123 $ 721,302 $ 649,706
Home sales NOI 74,382 28,624 32,825
Service, retail, dining and entertainment expenses NOI 64,470 7,184 2,282
NOI $ 1,120,975 $ 757,110 $ 684,813
SUN COMMUNITIES, INC.
Seasonality of Revenue
The RV and marina industries are seasonal in nature, and the results of operations in any one period may not be indicative of results in future periods.
In the RV segment, certain properties maintain higher occupancy during the summer months, while other properties maintain higher occupancy during the winter months. Based on the location of our properties with transient RV sites, our portfolio generally produces higher revenues between April and September than between October and March. Real property - transient revenue is included in RV segment revenue. The following table presents the seasonality of real property-transient revenue for the years ended December 31, 2021, 2020 and 2019:
Real property - transient revenue
(in thousands) For the Three Months Ended
Year March 31 June 30 September 30 December 31 Total
2021 $ 266,641 11.9 % 27.3 % 44.9 % 15.9 % 100.0 %
2020 $ 134,691 18.8 % 15.6 % 44.9 % 20.7 % 100.0 %
2019 $ 121,504 20.1 % 23.2 % 40.3 % 16.4 % 100.0 %
In the marina market, demand for wet slip storage increases during the summer months as customers contract for the summer boating season, which also drives non-storage revenue streams such as service, fuel and on-premise restaurants or convenience stores. Demand for dry storage increases during the winter season as seasonal weather patterns require boat owners to store their vessels on dry docks and within covered racks. Seasonal real property revenue was approximately $246.6 million and $24.4 million for the years ended December 31, 2021 and 2020, respectively. In 2021, seasonal real property revenue was recognized 17.7 percent in the first quarter, 25.0 percent in the second quarter, 29.9 percent in the third quarter and 27.4 percent in the fourth quarter. In 2020, seasonal real property revenue was recognized 100 percent in the fourth quarter, given that the Safe Harbor acquisition closed during the fourth quarter.
SUN COMMUNITIES, INC.
Comparison of the Years Ended December 31, 2021 and 2020
Real Property Operations - Total Portfolio
The following tables reflect certain financial and other information for our Total Portfolio as of and for the years ended December 31, 2021 and 2020 (in thousands, except for statistical information):
Year Ended
Financial Information December 31, 2021 December 31, 2020
Change % Change
Revenue
Real property (excluding Transient) $ 1,166,704 $ 867,532 $ 299,172 34.5 %
Real property - transient 281,432 172,430 109,002 63.2 %
Other 151,720 90,157 61,563 68.3 %
Total Operating 1,599,856 1,130,119 469,737 41.6 %
Expense
Property Operating 617,733 408,817 208,916 51.1 %
Real Property NOI $ 982,123 $ 721,302 $ 260,821 36.2 %
As of
Other Information December 31, 2021 December 31, 2020 Change
Number of properties(1)
602 552 50
Wet slips and dry storage spaces 45,155 38,739 6,416
MH occupancy 96.6 %
RV occupancy(2)
100.0 %
MH & RV blended occupancy(3)
97.4 % 97.3 % 0.1 %
Sites available for MH & RV development 10,672 10,025 647
Monthly base rent per site - MH $ 603 $ 589 (8)
$ 14
Monthly base rent per site - RV(7)
$ 526 $ 513 (8)
$ 13
Monthly base rent per site - Total $ 585 $ 571 (8)
$ 14
(1)Includes MH communities, RV resorts and marinas.
(2)Occupancy percentages include annual RV sites and exclude transient RV sites.
(3)Occupancy percentages include MH and annual RV sites, and exclude transient RV sites.
(4)Adjusted occupancy percentages include MH and exclude recently completed but vacant expansion sites.
(5)Adjusted occupancy percentages include annual RV sites, and exclude transient RV sites and recently completed but vacant expansion sites.
(6)Adjusted occupancy percentages include MH and annual RV sites, and exclude transient RV sites and recently completed but vacant expansion sites.
(7)Monthly base rent pertains to annual RV sites and excludes transient RV sites.
(8) Canadian currency figures included within the year ended December 31, 2020 have been translated at 2021 average exchange rates, respectively.
The $260.8 million increase in Real property NOI from 2020 to 2021 consists of $76.8 million from Same Community as detailed below, $148.0 million from the marinas and $36.0 million from recently acquired properties in the year ended December 31, 2021 as compared to 2020.
SUN COMMUNITIES, INC.
Real Property Operations - Same Community Portfolio
A key management tool used when evaluating performance and growth of our properties is a comparison of the Same Community portfolio. Same Community refers to properties that we have owned for at least the preceding year, exclusive of properties recently completed or under construction, and other properties as determined by management. The Same Community data may change from time-to-time depending on acquisitions, dispositions, management discretion, significant transactions or unique situations. In order to evaluate the growth of the Same Community portfolio, management has classified certain items differently than our GAAP statements. The reclassification difference between our GAAP statements and our Same Community portfolio is the reclassification of utility revenues from real property revenue to operating expenses. A significant portion of our utility charges are re-billed to our residents. For the years ended December 31, 2021 and 2020, Canadian currency figures included within the year ended December 31, 2020 have been translated at 2021 average exchange rates. For the years ended December 31, 2020 and 2019, Canadian currency figures included within the year ended December 31, 2019 have been translated at 2020 average exchange rates.
Year Ended
Total Same Community MH RV
Financial Information December 31, 2021 December 31, 2020 Change % Change December 31, 2021 December 31, 2020 Change % Change December 31, 2021 December 31, 2020 Change % Change
Revenue
Real property (excluding Transient) $ 875,361 $ 824,669 $ 50,692 6.1 % $ 693,374 $ 663,564 $ 29,810 4.5 % $ 181,987 $ 161,105 $ 20,882 13.0 %
Real property - transient 194,754 144,077 50,677 35.2 % 1,460 1,722 (262) (15.2) % 193,294 142,355 50,939 35.8 %
Other 39,011 23,362 15,649 67.0 % 19,265 10,298 8,967 87.1 % 19,746 13,064 6,682 51.1 %
Total Operating 1,109,126 992,108 117,018 11.8 % 714,099 675,584 38,515 5.7 % 395,027 316,524 78,503 24.8 %
Expense
Property Operating 345,737 305,561 40,176 13.1 % 182,771 169,072 13,699 8.1 % 162,966 136,489 26,477 19.4 %
Real Property NOI $ 763,389 $ 686,547 $ 76,842 11.2 % $ 531,328 $ 506,512 $ 24,816 4.9 % $ 232,061 $ 180,035 $ 52,026 28.9 %
Year Ended
Total Same Community MH RV
Financial Information December 31, 2020 December 31, 2019 Change % Change December 31, 2020 December 31, 2019 Change % Change December 31, 2020 December 31, 2019 Change % Change
Revenue
Real property (excluding Transient) $ 788,721 $ 747,710 $ 41,011 5.5 % $ 631,382 $ 597,030 $ 34,352 5.8 % $ 157,339 $ 150,680 $ 6,659 4.4 %
Real property - transient 131,693 137,271 (5,578) (4.1) % 1,405 1,891 (486) (25.7) % 130,288 135,380 (5,092) (3.8) %
Other 22,568 26,833 (4,265) (15.9) % 9,655 13,439 (3,784) (28.2) % 12,913 13,394 (481) (3.6) %
Total Operating 942,982 911,814 31,168 3.4 % 642,442 612,360 30,082 4.9 % 300,540 299,454 1,086 0.4 %
Expense
Property Operating 284,551 281,142 3,409 1.2 % 156,370 154,401 1,969 1.3 % 128,181 126,741 1,440 1.1 %
Real Property NOI $ 658,431 $ 630,672 $ 27,759 4.4 % $ 486,072 $ 457,959 $ 28,113 6.1 % $ 172,359 $ 172,713 $ (354) (0.2) %
SUN COMMUNITIES, INC.
As of As of
Other Information December 31, 2021 December 31, 2020 Change December 31, 2020 December 31, 2019 Change
Number of properties 403 403 - 367 367 -
MH occupancy 97.6 % 97.4 %
RV occupancy(1)
100.0 % 100.0 %
MH & RV blended occupancy(2)
98.2 % 98.0 %
Adjusted MH occupancy(3)
98.6 % 98.5 %
Adjusted RV occupancy(4)
100.0 % 100.0 %
Adjusted MH & RV blended occupancy(5)
98.9 % 97.5 % (6)
1.4 % 98.8 % 97.0 % (6)
1.8 %
Sites available for development 6,866 7,332 (466) 6,682 6,314 368
Monthly base rent per site - MH $ 611 $ 591 (8)
$ 20 $ 600 $ 580 (8)
$ 20
Monthly base rent per site - RV(7)
$ 537 $ 512 (8)
$ 25 $ 514 $ 488 (8)
$ 26
Monthly base rent per site - Total $ 593 $ 573 (8)
$ 20 $ 579 $ 558 (8)
$ 21
(1) Occupancy percentages include annual RV sites and exclude transient RV sites.
(2) Occupancy percentages include MH and annual RV sites, and exclude transient RV sites.
(3) Adjusted occupancy percentages include MH and exclude recently completed but vacant expansion sites.
(4) Adjusted occupancy percentages include annual RV sites, and exclude transient RV sites and recently completed but vacant expansion sites.
(5) Adjusted occupancy percentages include MH and annual RV sites, and exclude transient RV sites and recently completed but vacant expansion sites.
(6) The occupancy percentages for 2020 and 2019 have been adjusted to reflect incremental growth period-over-period from filled MH expansion sites and the conversion of transient RV sites to annual RV sites.
(7) Monthly base rent pertains to annual RV sites and excludes transient RV sites.
(8) Canadian currency figures included within the year ended December 31, 2020 and 2019 have been translated at 2021 and 2020 average exchange rates, respectively.
Years ended December 31, 2021 and 2020
The Same Community data includes all properties that we have owned and operated continuously since January 1, 2020, exclusive of ground-up development and redevelopment properties recently completed or under construction, and other properties as determined by management. We have reclassified $69.0 million and $63.1 million of utilities rebilled for the years ended December 31, 2021 and 2020, respectively, from Income from real property to Property operating expense to reflect the utility expenses associated with our Same Community portfolio net of resident retail.
The $76.8 million, or 11.2 percent, increase in Total Same Community NOI is due to a $52.0 million, or 28.9 percent, increase in NOI from the RV segment and $24.8 million, or 4.9 percent, increase in NOI from the MH segment.
The RV segment's $52.0 million, or 28.9 percent, increase in NOI is primarily due to an increase in Real property - transient revenue of $50.9 million, or 35.8 percent, due to increased transient and vacation rental stays at our resorts. The results of the comparative 2020 period were impacted by the required closure, or delayed opening, of over 40 of our RV resorts due to the COVID-19 pandemic.
The MH segment's $24.8 million, or 4.9 percent, increase in NOI is primarily due to an increase in Real property (excluding transient) revenue of $29.8 million, or 4.5 percent. Real property (excluding transient) revenue increased due to a 3.4 percent increase in monthly base rent per MH site and a 1.4 percent increase in occupancy when compared to the same period in 2020.
SUN COMMUNITIES, INC.
Years ended December 31, 2020 and 2019
The Same Community data includes all properties which we have owned and operated continuously since January 1, 2019, exclusive of ground-up development and redevelopment properties recently completed or under construction, and other properties as determined by management. We have reclassified $37.7 million and $34.7 million of utilities rebilled for the years ended December 31, 2020 and 2019, respectively, from Income from real property to Property operating expense to reflect the utility expenses associated with our Same Community portfolio net of recovery.
The $27.8 million, or 4.4 percent, growth in Total Same Community NOI is due to a 1.8 percent increase in occupancy and $28.1 million, or 6.1 percent, increase in NOI from the MH segment.
The RV segment NOI remained flat when compared to the same period in 2019.
The MH segment $28.1 million, or 6.1 percent, growth in NOI is primarily due to an increase in Real property (excluding transient) revenue of $34.4 million, or 5.8 percent. Real property (excluding transient) revenue increased due to a 3.4 percent increase in monthly base rent per MH site and a 1.8 percent increase in occupancy when compared to the same period in 2019.
SUN COMMUNITIES, INC.
Marina Summary
The following table reflects certain financial and other information for our marinas for the year ended December 31, 2021 (in thousands, except for statistical information):
Year Ended
December 31, 2021 December 31, 2020(a)
Change % Change
Financial Information
Revenues
Real property (excluding transient) $ 250,984 $ 25,632 $ 225,352 N/M
Real property - transient 14,790 805 13,985 N/M
Other 14,053 880 13,173 N/M
Total Operating 279,827 27,317 252,510 N/M
Expenses
Property Operating(b)
117,711 13,175 104,536 N/M
Real Property NOI 162,116 14,142 147,974 N/M
Service, retail, dining and entertainment
Revenue 269,170 19,393 249,777 N/M
Expense 219,040 16,061 202,979 N/M
NOI 50,130 3,332 46,798 N/M
Marina NOI $ 212,246 $ 17,474 $ 194,772 N/M
Other Information
Number of properties 125 106 19 17.9%
Total wet slips and dry storage 45,155 38,739 6,416 16.6%
N/M = Percentage change is not meaningful.
(a) Contains two months of activity.
(b) Marina results net $15.0 million for the year ended December 31, 2021 and $4.5 million for the two months ended December 31, 2020 of certain utility revenue against the related utility expense in property operating and maintenance expense.
SUN COMMUNITIES, INC.
Home Sales Summary
We purchase new homes and acquire pre-owned and repossessed manufactured homes, generally located within our communities, from lenders, dealers, and former residents to lease or sell to current and prospective residents.
The following table reflects certain financial and statistical information for our Home Sales Program for the years ended December 31, 2021 and 2020 (in thousands, except for average selling prices and statistical information):
Year Ended
Financial Information December 31, 2021 December 31, 2020 Change % Change
New homes
New home sales $ 114,852 $ 79,728 $ 35,124 44.1%
New home cost of sales 94,103 65,533 28,570 43.6%
Gross Profit - new homes 20,749 14,195 6,554 46.2%
Gross margin % - new homes 18.1 % 17.8 % 0.3 %
Average selling price - new homes $ 156,902 $ 139,874 $ 17,028 12.2%
Pre-owned homes
Pre-owned home sales $ 165,300 $ 95,971 $ 69,329 72.2%
Pre-owned home cost of sales 93,024 66,351 26,673 40.2%
Gross Profit - pre-owned homes 72,276 29,620 42,656 144.0%
Gross margin % - pre-owned homes 43.7 % 30.9 % 12.8 %
Average selling price - pre-owned homes $ 49,255 $ 41,799 $ 7,456 17.8%
Total home sales
Revenue from home sales $ 280,152 $ 175,699 $ 104,453 59.4%
Cost of home sales 187,127 131,884 55,243 41.9%
Home selling expenses 18,643 15,191 3,452 22.7%
Home Sales NOI $ 74,382 $ 28,624 $ 45,758 159.9%
Statistical Information
New home sales volume 732 570 162 28.4%
Pre-owned home sales volume 3,356 2,296 1,060 46.2%
Total home sales volume 4,088 2,866 1,222 42.6%
Gross Profit - New Homes
For the year ended December 31, 2021, the $6.6 million, or 46.2 percent, increase in gross profit is primarily the result of a 28.4 percent increase in new home sales volume, coupled with a 12.2 percent increase in new home average selling price, as compared to the same period in 2020.
Gross Profit - Pre-owned Homes
For the year ended December 31, 2021, the $42.7 million, or 144.0 percent, increase in gross profit is primarily the result of a 46.2 percent increase in pre-owned home sales volume, coupled with a 12.8 percent increase in gross margin, primarily due to a 17.8 percent increase in the pre-owned home average selling price, as compared to the same period in 2020.
Homes sales NOI
For the year ended December 31, 2021, the $45.8 million, or 159.9 percent, increase in NOI is primarily the result of a 42.6 percent increase in home sales volume, coupled with an increase in new home and pre-owned home average selling price and pre-owned home margin, as compared to the same period in 2020.
SUN COMMUNITIES, INC.
Rental Program Summary
The following table reflects certain financial and other information for our Rental Program for the years ended December 31, 2021 and 2020 (in thousands, except for statistical information):
Year Ended
Financial Information December 31, 2021 December 31, 2020 Change % Change
Revenues
Home rent $ 66,442 $ 62,546 $ 3,896 6.2 %
Site rent 71,670 74,823 (3,153) (4.2) %
Total 138,112 137,369 743 0.5 %
Expenses
Rental Program operating and maintenance 19,725 20,408 (683) (3.3) %
Rental Program NOI $ 118,387 $ 116,961 $ 1,426 1.2 %
Other Information
Number of sold rental homes 1,071 850 221 26.0 %
Number of occupied rentals, end of period 9,870 11,752 (1,882) (16.0) %
Investment in occupied rental homes, end of period $ 556,342 $ 629,162 $ (72,820) (11.6) %
Weighted average monthly rental rate, end of period $ 1,110 $ 1,042 $ 68 6.5 %
The Rental Program NOI is included in Real property NOI. The Rental Program NOI is separately reviewed to assess the overall growth and performance of the Rental Program and its financial impact on our operations.
For the year ended December 31, 2021, Rental Program NOI increased $1.4 million, or 1.2 percent as compared to the same period in 2020. The increase is primarily due to a 6.5 percent increase in weighted average monthly rent, coupled with a 3.3 percent decrease in expenses, partially offset by a decrease in the number of occupied rental homes as compared to the same period in 2020.
SUN COMMUNITIES, INC.
Other Items - Statements of Operations(1)
The following table summarizes other income and expenses for the years ended December 31, 2021 and 2020 (amounts in thousands):
Year Ended
December 31, 2021 December 31, 2020 Change % Change
Service, retail, dining and entertainment, net $ 64,470 $ 7,184 $ 57,286 797.4 %
Interest income $ 12,232 $ 10,119 $ 2,113 20.9 %
Brokerage commissions and other, net $ 30,127 $ 17,230 $ 12,897 74.9 %
General and administrative expense $ 181,210 $ 109,616 $ 71,594 65.3 %
Catastrophic event-related charges, net $ 2,239 $ 885 $ 1,354 153.0 %
Business combination expense, net $ 1,362 $ 23,008 $ (21,646) (94.1) %
Depreciation and amortization $ 522,745 $ 376,876 $ 145,869 38.7 %
Loss on extinguishment of debt (see Note 8)
$ 8,127 $ 5,209 $ 2,918 56.0 %
Interest expense $ 158,629 $ 129,071 $ 29,558 22.9 %
Interest on mandatorily redeemable preferred OP units / equity $ 4,171 $ 4,177 $ (6) (0.1) %
Gain on remeasurement of marketable securities (see Note 14)
$ 33,457 $ 6,129 $ 27,328 445.9 %
Gain / (loss) on foreign currency translation $ (3,743) $ 7,666 $ (11,409) (148.8) %
Gain on dispositions of properties $ 108,104 $ 5,595 $ 102,509 N/M
Other expense, net $ (12,122) $ (5,188) $ (6,934) 133.7 %
Gain / (loss) on remeasurement of notes receivable (see Note 4)
$ 685 $ (3,275) $ 3,960 120.9 %
Income from nonconsolidated affiliates (see Note 6)
$ 3,992 $ 1,740 $ 2,252 129.4 %
Loss on remeasurement of investment in nonconsolidated affiliates (see Note 6)
$ (160) $ (1,608) $ 1,448 90.0 %
Current tax expense (see Note 12)
$ (1,236) $ (790) $ (446) 56.5 %
Deferred tax benefit / (expense) (see Note 12)
$ (91) $ 1,565 $ (1,656) (105.8) %
Preferred return to preferred OP units / equity interests $ 12,095 $ 6,935 $ 5,160 74.4 %
Income attributable to noncontrolling interests $ 21,490 $ 8,902 $ 12,588 141.4 %
(1) Only items determined by management to be material, of interest, or unique to the periods disclosed above are explained below.
N/M = Percentage change is not meaningful.
Service, retail, dining and entertainment, net - for the year ended December 31, 2021, increased primarily due to the addition of marina service revenue, driven by a full year of activity from Safe Harbor, and increases in RV resort activity revenues as compared to 2020.
Brokerage commissions and other, net - for the year ended December 31, 2021, increased primarily due to an increase in brokerage commissions as a result of an increase in the number of brokered home sales, as compared to 2020.
General and administrative expense - for the year ended December 31, 2021, increased primarily due to a full year of activity from Safe Harbor, and an increase in wages and incentives driven by growth in strategic initiatives and acquisition activity, as compared to 2020.
Business combination expense, net - for the year ended December 31, 2021, decreased due to the prior year acquisition of Safe Harbor. Refer to Note 3, "Real Estate Acquisitions and Dispositions," of our accompanying Consolidated Financial Statements for additional information.
Depreciation and amortization - for the year ended December 31, 2021, increased as a result of acquisition, expansion and development activity driving growth in our portfolio of MH communities, RV resorts and marinas as compared to 2020. Refer to Note 3, "Real Estate Acquisitions and Dispositions," of our accompanying Consolidated Financial Statements for additional information.
Loss on extinguishment of debt - for the year ended December 31, 2021, increased primarily due to the termination of the Safe Harbor line of credit and financing activities as compared to 2020. Refer to Note 8, "Debt and Line of Credit," in our accompanying Consolidated Financial Statements for additional information.
SUN COMMUNITIES, INC.
Interest expense - for the year ended December 31, 2021, increased primarily due to the higher carrying balance of debt as compared to the same period in 2020. Refer to Note 8, "Debt and Line of Credit," of our accompanying Consolidated Financial Statements for additional information.
Gain on remeasurement of marketable securities - for the year ended December 31, 2021, increased due to higher gain on the remeasurement of our investment in marketable securities as compared to 2020. Refer to Note 15, "Fair Value of Financial Instruments," in our accompanying Consolidated Financial Statements for additional information.
Gain / (loss) on foreign currency translation - for the year ended December 31, 2021, there was a $3.7 million loss as compared to a $7.7 million gain in the same period in 2020, primarily due to fluctuations in exchange rates on Canadian and Australian denominated currencies.
Gain on dispositions of properties - for the year ended December 31, 2021, increased due to a gain resulting from the sale of six MH communities in various states. Refer to Note 3, "Real Estate Acquisitions and Dispositions," in our accompanying Consolidated Financial Statements for additional information.
Other expense, net - for the year ended December 31, 2021, increased primarily due to an estimated contingent liability related to potential termination of certain ground leases.
Gain / (loss) on remeasurement of notes receivable - represents the change in fair value of our in-house financing notes receivable portfolio, for which we elected the fair value option on January 1, 2020. Refer to Note 4, "Notes and Other Receivables," and Note 14, "Fair Value of Financial Instruments," in our accompanying Consolidated Financial Statements for additional information.
Income from nonconsolidated affiliates - for the year ended December 31, 2021, increased primarily due to increased equity income at GTSC LLC ("GTSC") and the Sungenia joint venture ("Sungenia JV") as compared to 2020. Refer to Note 6, "Investments in Nonconsolidated Affiliates," in our accompanying Consolidated Financial Statements for additional information.
Preferred return to preferred OP units / equity interests - for the year ended December 31, 2021 increased primarily as a result of preferred OP units issued in conjunction with various acquisitions since 2020. Refer to Note 3, "Real Estate Acquisitions and Dispositions," and Note 9, "Equity and Temporary Equity," of our accompanying Consolidated Financial Statements for additional information.
Income attributable to noncontrolling interests - for the year ended December 31, 2021, increased as compared to 2020, primarily due to improved financial performance of the Company and its consolidated VIEs. Refer to Note 7, "Consolidated Variable Interest Entities," in our accompanying Consolidated Financial Statements for additional information.
Year Ended December 31, 2020 Compared to the Year Ended December 31, 2019
Pursuant to the FAST Act Modernization and Simplification of Regulation S-K, discussions related to the changes in results of operations for the year ended December 31, 2020 compared to the year ended December 31, 2019 have been omitted, except for the Same Community results where the presentation structure has changed consistent with our new segment reporting, and prior year data differ from amounts previously disclosed in Form 10-K for the year ended December 31, 2020 as a result of prior year reclassification and site count changes. Such omitted discussion can be found under Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2020 filed with the Securities and Exchange Commission on February 18, 2021.
SUN COMMUNITIES, INC.
RECONCILIATION OF NET INCOME ATTRIBUTABLE TO SUN COMMUNITIES, INC. COMMON STOCKHOLDERS TO FFO
The following table reconciles Net income attributable to Sun Communities, Inc. common stockholders to FFO for the years ended December 31, 2021, 2020 and 2019 (in thousands, except per share amounts):
Year Ended
December 31, 2021 December 31, 2020 December 31, 2019
Net Income Attributable to Sun Communities, Inc. Common Stockholders $ 380,152 $ 131,614 $ 160,265
Adjustments
Depreciation and amortization 521,856 376,897 328,646
Depreciation on nonconsolidated affiliates 123 66 -
Gain on remeasurement of marketable securities
(33,457) (6,129) (34,240)
Loss on remeasurement of investment in nonconsolidated affiliates 160 1,608 -
(Gain) / loss on remeasurement of notes receivable (685) 3,275 -
Income attributable to noncontrolling interests 14,783 7,881 8,474
Preferred return to preferred OP units 1,888 2,231 2,610
Preferred distribution to Series A-4 preferred stock - - 1,288
Interest expense on Aspen preferred OP units 2,056 - -
Gain on dispositions of properties (108,104) (5,595) -
Gain on dispositions of assets, net (60,485) (22,180) (26,356)
FFO Attributable to Sun Communities, Inc. Common Stockholders and Dilutive Convertible Securities(1)
$ 718,287 $ 489,668 $ 440,687
Adjustments
Business combination expense and other acquisition related costs(2)
10,005 25,334 1,146
Loss on extinguishment of debt 8,127 5,209 16,505
Catastrophic event-related charges, net 2,239 885 1,737
Earnings - catastrophic event-related charges(3)
200 - -
(Gain) / loss on foreign currency translation 3,743 (7,666) (4,480)
Other adjustments, net(4)
16,139 2,130 1,337
Core FFO Attributable to Sun Communities, Inc. Common Stockholders and Dilutive Convertible Securities(1)
$ 758,740 $ 515,560 $ 456,932
Weighted average common shares outstanding - basic 112,582 97,521 88,460
Add
Common stock issuable upon conversion of stock options - 1 1
Restricted stock 220 455 454
Common OP units 2,562 2,458 2,448
Common stock issuable upon conversion of certain preferred OP units 1,151 907 1,454
Weighted Average Common Shares Outstanding - Fully Diluted 116,515 101,342 92,817
FFO Attributable to Sun Communities, Inc. Common Stockholders and Dilutive Convertible Securities Per Share - Fully Diluted $ 6.16 $ 4.83 $ 4.75
Core FFO Attributable to Sun Communities, Inc. Common Stockholders and Dilutive Convertible Securities Per Share - Fully Diluted $ 6.51 $ 5.09 $ 4.92
(1)The effect of certain anti-dilutive convertible securities is excluded from these items.
(2)These costs represent business combination expenses and expenses incurred to bring recently acquired properties up to our operating standards, including items such as tree trimming and painting costs that do not meet our capitalization policy.
(3)Adjustment related to estimated loss of earnings in excess of the applicable business interruption deductible in relation to our three Florida Keys communities that were impaired by Hurricane Irma which had not yet been received from our insurer.
(4)Other adjustments, net include the change in estimated contingent consideration payments, long term lease termination expense and deferred tax (benefit) / expense for the years ended December 31, 2021, 2020 and 2019, RV rebranding non-recurring cost for the year ended December 31, 2021, and deferred compensation amortization upon retirement for the year ended December 31, 2020.
SUN COMMUNITIES, INC.
LIQUIDITY AND CAPITAL RESOURCES
Short-term Liquidity
Our principal short-term liquidity demands have historically been, and are expected to continue to be, distributions to our stockholders and the unit holders of the Operating Partnership, property acquisitions, development and expansion of properties, capital improvement of properties, the purchase of new and pre-owned homes, and debt repayment. We intend to meet our short-term liquidity requirements through available cash balances, cash flows generated from operations, draws on our line of credit, and the use of debt and equity offerings under our shelf registration statement. Refer to Note 8, "Debt and Line of Credit," and Note 9, "Equity and Temporary Equity," in our accompanying Consolidated Financial Statements for additional information.
We also intend to continue to strengthen our capital and liquidity positions by focusing on our core fundamentals, which are generating positive cash flows from operations, maintaining appropriate debt levels and leverage ratios, and controlling overhead costs. We take a disciplined approach to selecting the optimal mix of financing sources to meet our liquidity demands and minimize our overall cost of capital. In June 2021, we received investment grade ratings of BBB and Baa3 with a stable outlook from S&P Global and Moody's, respectively. We plan on leveraging this enhanced strength in the credit markets to utilize a greater proportion of unsecured debt to lower our cost of capital and increase our financial flexibility.
Acquisitions
Subject to market conditions, we intend to continue to identify opportunities to expand our development pipeline and acquire existing properties. We finance acquisitions through available cash, secured financing, draws on our lines of credit, the assumption of existing debt on properties, and the issuance of debt and equity securities. We will continue to evaluate acquisition opportunities that meet our criteria. Refer to Note 3, "Real Estate Acquisitions and Dispositions," in our accompanying Consolidated Financial Statements for information regarding recent property acquisitions.
We anticipate that our acquisition of Park Holidays will close within the three months ending March 31, 2022, subject to the approval of the UK Financial Conduct Authority. We anticipate that we will need approximately $1.3 billion in cash to fund the acquisition of Park Holidays.
We have obtained commitments from our lenders to amend, extend and upsize the Senior Credit Facility simultaneously with, and conditioned on, the closing of the acquisition of Park Holidays. The proposed amendment (the "Proposed Loan Amendment") would provide for borrowing up to an aggregate of $4.2 billion with the ability to upsize the total borrowing by an additional $800.0 million. The Proposed Loan Amendment would provide a revolving loan facility of up to $3.05 billion and a term loan facility of $1.15 billion.
We intend to use a portion of the proceeds from the Proposed Loan Amendment to fund the cash purchase price of Park Holidays. There can be no assurance that we will be able to successfully enter into the Proposed Loan Amendment on the terms described above or at all. If the Proposed Loan Amendment is not entered into, we may use our previously announced bridge loan, further described below, to fund all or a portion of the cash purchase price of Park Holidays.
Capital Expenditures
Our capital expenditures include expansion sites and development construction costs, recurring capital expenditures, lot modifications, growth projects, acquisition-related capital expenditures, rental home purchases and rebranding cost.
SUN COMMUNITIES, INC.
Our capital expenditure activity is summarized as follows (in thousands):
Year Ended
December 31, 2021 December 31, 2020
Expansion and Development $ 201,601 $ 248,146
Recurring Capital Expenditures 64,631 33,472
Lot Modifications 28,802 29,414
Growth Projects 77,037 28,315
Acquisition-related Capital Expenditures 176,463 46,739
Rental Program 117,371 143,117
Rebranding 6,142 N/A
Other 524 9,320
Total capital expenditures activity $ 672,571 $ 538,523
Expansion and development expenditures - consist primarily of construction costs such as roads, activities, and amenities, and costs necessary to complete home and RV site improvements, such as driveways, sidewalks and landscaping at our MH communities and RV resorts. Expenditures also include costs to rebuild after damage has been incurred at MH, RV or marina properties.
Recurring capital expenditures - relate to our continued commitment to the upkeep of our MH and RV properties and include items such as dredging, dock repairs and improvements, and equipment maintenance and upgrades at our marinas.
Lot modification capital expenditures - are incurred to modify the foundational structures required to set a new home after a previous home has been removed. These expenditures are necessary to create a revenue stream from a new site renter and often improve the quality of the community. Other lot modification expenditures include land improvements added to annual RV sites to aid in the conversion of transient RV guests to annual contracts.
Growth projects - consist of revenue generating or expense reducing activities at MH communities, RV resorts and marinas. This includes, but is not limited to, utility efficiency and renewable energy projects, site, slip or amenity upgrades such as the addition of a garage, shed or boat lift, and other special capital projects that substantiate an incremental rental increase.
Acquisition-related Capital Expenditures - consist of capital improvements identified during due diligence that are necessary to bring our communities, resorts, and marinas up to our operating standards. 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; lot modifications; and new signage.
Rental Program - investment in the acquisition of homes intended for the Rental Program and the purchase of vacation rental homes at our RV resorts. Expenditures for these investments depend upon the condition of the markets for repossessions and new home sales, rental homes and vacation rental homes.
Rebranding costs - includes new signage at our RV resorts and costs of building an RV mobile application and updated website.
Cash Flow Activities
Our cash flow activities are summarized as follows (in thousands):
Year Ended
December 31, 2021 December 31, 2020 December 31, 2019
Net Cash Provided by Operating Activities $ 753,572 $ 543,295 $ 476,734
Net Cash Used for Investing Activities $ (2,338,249) $ (2,486,517) $ (1,010,457)
Net Cash Provided by Financing Activities $ 1,570,391 $ 2,000,844 $ 505,880
Effect of Exchange Rate Changes on Cash, Cash Equivalents and Restricted Cash $ (157) $ 189 $ 411
Cash, cash equivalents, and restricted cash decreased by approximately $14.4 million from $92.6 million as of December 31, 2020, to $78.2 million as of December 31, 2021.
SUN COMMUNITIES, INC.
Operating Activities - Net cash provided by operating activities increased $210.3 million to $753.6 million for the year ended December 31, 2021, compared to $543.3 million for the year ended December 31, 2020. The increase was driven by an increase in net income from property operations due to the acquisition of Safe Harbor in October 2020 and improved operating performance at our MH and RV properties.
Our net cash flows provided by operating activities from continuing operations may be adversely impacted by, among other things: (a) the market and economic conditions in our current markets generally, and specifically in metropolitan areas of our current markets; (b) lower occupancy and rental rates of our properties; (c) increased operating costs, such as wage and benefit costs, insurance premiums, real estate taxes and utilities, that cannot be passed on to our tenants; (d) decreased sales of manufactured homes; (e) current volatility in economic conditions and the financial markets; and (f) the effects of the COVID-19 pandemic. Refer to "Risk Factors" in Part I, Item 1A in this Annual Report on Form 10-K.
Investing Activities - Net cash used for investing activities was $2.3 billion for the year ended December 31, 2021, compared to $2.5 billion for year ended December 31, 2020. The decrease in Net cash used for investing activities was driven by a reduction in cash outflows to acquire new properties due to the prior year acquisition of Safe Harbor. During the year ended December 31, 2021, net cash used for investing activities included the following:
•Net cash deployed of $1.6 billion to acquire 54 properties totaling over 16,800 sites, wet slips and dry storage spaces and sites for expansion, and 11 land parcels approved for development of nearly 4,000 MH sites.
•Cash deployed of $672.6 million for capital expenditure activity.
•Cash deployed of $242.6 million for issuance of notes receivable to real estate developers and operators.
•Proceeds of $162.1 million from the disposition of six MH communities.
•Proceeds of $113.8 million from sale of rental homes and equipment.
Refer to Note 3, "Real Estate Acquisitions and Dispositions," in our accompanying Consolidated Financial Statements for additional information.
Financing Activities - Net cash provided by financing activities decreased $430.5 million to $1.6 billion for the year ended December 31, 2021, compared to $2.0 billion for the year ended December 31, 2020. During the year ended December 31, 2021, net cash provided by financing activities included the following:
•Proceeds of $1.1 billion from equity issuances, primarily due to the March 2021 underwritten public offering of an aggregate of 8,050,000 shares at a public offering price of $140.00 per share.
•Issuance of an aggregate of $1.2 billion of senior unsecured notes from issuances in June 2021 and October 2021.
•Payments of $390.8 million for distributions to holders of common stock and common OP units.
•Net payments of $198.9 million under our credit facility agreement, net of proceeds.
Refer to Note 8, "Debt and Line of Credit," and Note 9, "Equity and Temporary Equity," in our accompanying Consolidated Financial Statements for additional information.
Equity and Debt Activity
Registering of Debt Securities
In March 2020, the SEC adopted amendments to Rule 3-10 of Regulation S-X and created Rule 13-01 to simplify disclosure requirements related to certain registered securities. The rule became effective January 4, 2021. In April 2021, we filed a new universal shelf registration statement on Form S-3 with the SEC registering, among other securities, debt securities of the Operating Partnership, which are fully and unconditionally guaranteed by us.
SUN COMMUNITIES, INC.
Public Equity Offerings
Offerings
On November 15 and 16, 2021, we entered into two forward sale agreements relating to an underwritten registered public offering of 4,025,000 shares of our common stock at a public offering price of $185.00 per share. The offering closed on November 18, 2021. We did not initially receive any proceeds from the sale of shares of our common stock by the forward purchaser or its affiliates. We intend to use the net proceeds, if any, received upon the future settlement of the forward sale agreements, which we expect to occur no later than November 18, 2022, to fund a portion of the Park Holidays total consideration, to repay borrowings outstanding under our senior credit facility, to fund possible future acquisitions of properties and / or for working capital and general corporate purposes.
On March 2, 2021, we priced a $1.1 billion underwritten public offering of an aggregate of 8,050,000 shares at a public offering price of $140.00 per share, before underwriting discounts and commissions. The offering consisted of 4,000,000 shares offered directly by us and 4,050,000 shares offered under a forward equity sales agreement. We sold the 4,000,000 shares on March 9, 2021 and received net proceeds of $537.6 million after deducting expenses related to the offering. In May and June 2021, we completed the physical settlement of the remaining 4,050,000 shares and received net proceeds of $539.7 million after deducting expenses related to the offering. Proceeds from the offering were used to acquire assets and pay down borrowings under our revolving line of credit.
On September 30, 2020 and October 1, 2020, we entered into two forward sale agreements (the "September 2020 Forward Equity Offerings") relating to an underwritten registered public offering of 9,200,000 shares of our common stock at a public offering price of $139.50 per share. The offering closed on October 5, 2020. On October 26, 2020, we physically settled these forward sales agreements by the delivery of shares of our common stock. Proceeds from the offering were approximately $1.23 billion after deducting expenses related to the offering. We used the net proceeds of this offering to fund the cash portion of the acquisition of Safe Harbor, and for working capital and general corporate purposes.
In May 2020, we closed an underwritten registered public offering of 4,968,000 shares of common stock. Proceeds from the offering were $633.1 million after deducting expenses related to the offering. We used the net proceeds of this offering to repay borrowings outstanding under the revolving loan under our senior credit facility.
At the Market Offering Sales Agreements
On December 17, 2021, we entered into an At the Market Offering Sales Agreement with certain sales agents and forward sellers pursuant to which we may sell, from time to time, up to an aggregate gross sales price of $1.25 billion of our common stock (the "December 2021 Sales Agreement"), through the sales agents, acting as our sales agents or, if applicable, as forward sellers, or directly to the sales agents as principals for their own accounts. The sales agents and forward sellers are entitled to compensation in an agreed amount not to exceed 2.0 percent of the gross price per share for any shares sold under the December 2021 Sales Agreement. We simultaneously terminated our June 2021 Sales Agreement (as defined below) upon entering into the December 2021 Sales Agreement.
On June 4, 2021, we entered into an At the Market Offering Sales Agreement with certain sales agents and forward sellers pursuant to which we could sell, from time to time, up to an aggregate gross sales price of $500.0 million of our common stock (the "June 2021 Sales Agreement"), through the sales agents, acting as our sales agents or, if applicable, as forward sellers, or directly to the sales agents as principals for their own accounts. The sales agents and forward sellers are entitled to compensation in an agreed amount not to exceed 2.0 percent of the gross price per share for any shares sold under the Sales Agreement. We simultaneously terminated our previous At the Market Offering Sales Agreement entered into in July 2017 upon entering into the June 2021 Sales Agreement.
There were no sales of common stock under the December 2021 Sales Agreement as of December 31, 2021. We entered into forward sale agreements with respect to 1,820,109 shares of common stock under the June 2021 Sales Agreement for $356.5 million during the year ended December 31, 2021 prior to its termination. These forward sale agreements were not settled as of December 31, 2021 but we expect to settle them no later than September 2022. There were zero issuances of common stock under the prior At the Market Offering Sales Agreement entered into in July 2017, during the years ended December 31, 2021, 2020 and 2019, and from inception through termination of such prior sales agreement, we sold shares of our common stock for gross proceeds of $163.8 million.
SUN COMMUNITIES, INC.
Senior Unsecured Notes
On October 5, 2021, we issued $450.0 million of senior unsecured notes with an interest rate of 2.3 percent and a seven-year term, due November 1, 2028 (the "2028 Notes"). Interest on the 2028 Notes is payable semi-annually in arrears on May 1 and November 1 of each year, beginning on May 1, 2022. In addition, on October 5, 2021, we issued $150 million of senior unsecured notes with an interest rate of 2.7 percent and a ten-year term due July 15, 2031. These notes are additional notes of the same series as the $600.0 million aggregate principal amount of 2.7 percent senior unsecured notes due July 15, 2031 that we issued on June 28, 2021, described below. The net proceeds from the offering were approximately $595.5 million after deducting underwriters' discounts and estimated offering expenses. The proceeds were used to pay down borrowings under our line of credit.
On June 28, 2021, we issued $600.0 million of senior unsecured notes with an interest rate of 2.7 percent and a ten-year term, due July 15, 2031 (the "2031 Notes"). Interest on the 2031 Notes is payable semi-annually in arrears on January 15 and July 15 of each year, beginning on January 15, 2022. The net proceeds from the offering were approximately $592.4 million, after deducting underwriters' discounts and estimated offering expenses. The proceeds were used to pay down borrowings under our line of credit.
The total outstanding balance on senior unsecured notes was $1.2 billion at December 31, 2021.
The obligations of the Operating Partnership to pay principal, premiums, if any, and interest on the 2031 and 2028 Notes are guaranteed on a senior basis by Sun Communities, Inc. The guarantee is full and unconditional, and the Operating Partnership is a consolidated subsidiary of the Company. Under Rule 3-10 of Regulation S-X, as amended, subsidiary issuers of obligations guaranteed by the parent are not required to provide separate financial statements, provided that the subsidiary obligor is consolidated into the parent company's consolidated financial statements, the parent guarantee is "full and unconditional" and, subject to certain exceptions, the alternative disclosure required by Rule 13-01 is provided, which includes narrative disclosure and summarized financial information. Accordingly, separate consolidated financial statements of the Operating Partnership have not been presented. Furthermore, as permitted under Rule 13-01(a)(4)(vi), we have excluded the summarized financial information for the Operating Partnership as the assets, liabilities and results of operations of the Operating Partnership are not materially different from the corresponding amounts presented in our consolidated financial statements and management believes such summarized financial information would be repetitive and not provide incremental value to investors.
Line of Credit
On June 14, 2021, we entered into a new senior credit agreement (the "Credit Agreement") with certain lenders. The Credit Agreement combined and replaced our prior $750.0 million credit facility, which was scheduled to mature on May 21, 2023, (the "A&R Facility"), and the $1.8 billion credit facility between Safe Harbor and certain lenders, which was scheduled to mature on October 11, 2024 (the "Safe Harbor Facility"). The Safe Harbor Facility was terminated in connection with the execution of the Credit Agreement. We repaid all amounts due and outstanding under the Safe Harbor Facility on or prior to June 14, 2021. We recognized a Loss on extinguishment of debt in our Consolidated Statement of Operations related to the termination of the A&R Facility and the Safe Harbor Facility of $0.2 million and $7.9 million, respectively.
Pursuant to the Credit Agreement, we may borrow up to $2.0 billion under a revolving loan (the "Senior Credit Facility"). The Senior Credit Facility is available to fund all of the Company's businesses, including its marina business conducted by Safe Harbor. The Credit Agreement also permits, subject to the satisfaction of certain conditions, additional borrowings (with the consent of the lenders) in an amount not to exceed $1.0 billion with the option to treat all, or a portion, of such additional funds as an incremental term loan.
The Senior Credit Facility has a four-year term ending June 14, 2025, and, at our option, the maturity date may be extended for two additional six-month periods, subject to the satisfaction of certain conditions. However, the maturity date with respect to $500.0 million of available borrowing under the Senior Credit Facility is October 11, 2024, which, under the terms of the Senior Credit Agreement, may not be extended. The Senior Credit Facility bears interest at a floating rate based on the Adjusted Eurocurrency rate or BBSY rate, plus a margin that is determined based on the Company's credit ratings calculated in accordance with the Senior Credit Agreement, which can range from 0.725 percent to 1.4 percent. As of December 31, 2021, the margin based on our credit ratings was 0.85 percent on the Senior Credit Facility.
SUN COMMUNITIES, INC.
At the lenders' option, the Senior Credit Facility will become immediately due and payable upon an event of default under the Credit Agreement. We had $1.0 billion of borrowings on the Senior Credit Facility as of December 31, 2021, all scheduled to mature June 14, 2025. As of December 31, 2020, we had $40.4 million of borrowings on the revolving loan and no borrowings on the term loan under our A&R Facility, respectively. As of December 31, 2020, we had $652.0 million and $500.0 million of borrowings under the revolving loan and term loan under the Safe Harbor Facility, respectively. These balances are recorded in the Unsecured debt line item on the Consolidated Balance Sheets.
The Senior Credit Facility provides us with the ability to issue letters of credit. Our issuance of letters of credit does not increase our borrowings outstanding under the Senior Credit Facility, but does reduce the borrowing amount available. At December 31, 2021 and 2020, we had approximately $2.2 million and $2.4 million (including none and $0.3 million associated with the Safe Harbor Facility) of outstanding letters of credit, respectively.
We have obtained commitments from our lender group to amend the Senior Credit Facility in connection with the acquisition of Park Holidays. Refer to Note 19, "Subsequent Events," in our accompanying Consolidated Financial Statements for additional information about the Proposed Loan Amendment.
Potential Bridge Loan
On November 13, 2021, we entered into a commitment letter with Citigroup Global Markets, Inc. ("Citigroup"), pursuant to which, and subject to certain terms and conditions (including the closing of the acquisition of Park Holidays), Citigroup (on behalf of its affiliates) committed to lend us up to £950.0 million, or approximately $1.3 billion converted at the December 31, 2021 exchange rate, under a new senior unsecured bridge loan (the "Bridge Loan"). If we enter into the Bridge Loan, the proceeds of the Bridge Loan will be used to finance a portion of the cash consideration payable for the acquisition of Park Holidays. As of December 31, 2021, we did not have any borrowings outstanding under the Bridge Loan.
Financial Covenants
Pursuant to the terms of the Senior Credit Facility, we are subject to various financial and other covenants. The most restrictive financial covenants for the Senior Credit Facility are as follows:
Covenant Requirement As of December 31, 2021
Maximum leverage ratio <65.0% 28.4%
Minimum fixed charge coverage ratio >1.40 4.57
Maximum dividend payout ratio <95.0% 49.3%
Maximum secured leverage ratio <40.0% 15.3%
In addition, we are required to maintain the following covenants with respect to the senior unsecured notes payable:
Covenant Requirement As of December 31, 2021
Total debt to total assets ≤ 60.0% 38.6%
Secured debt to total assets ≤ 40.0% 22.9%
Consolidated income available for debt service to debt service ≥ 1.50 5.81
Unencumbered total asset value to total unsecured debt ≥ 150.0% 431.7%
As of December 31, 2021, we were in compliance with the above covenants and do not anticipate that we will be unable to comply with these covenants in the near term.
SUN COMMUNITIES, INC.
Proactive management of transition away from LIBOR
LIBOR has been used extensively in the U.S. and globally as a reference rate for various commercial and financial contracts, including variable-rate debt and interest rate swap contracts. However, based on an announcement made by the FCA on March 3, 2021, one-week and two-month LIBOR rates ceased to be published after December 31, 2021, and all other LIBOR settings will effectively cease after June 30, 2023, and it is expected that LIBOR will no longer be used after this date. In addition, it is expected that LIBOR will no longer be used in new contracts entered into after December 31, 2021. To address the impending discontinuation of LIBOR, in the U.S. the Alternative Reference Rates Committee ("ARRC") was established to help ensure the successful transition from LIBOR to a more robust reference rate, its recommended alternative, the Secured Overnight Financing Rate (“SOFR”). SOFR is a new index calculated by reference to short-term repurchase agreements backed by U.S. Treasury securities, as its preferred replacement for U.S. dollar LIBOR. We have been closely monitoring developments related to the transition away from LIBOR and have implemented proactive measures to minimize the potential impact of the transition to the Company, specifically:
•During the year ended December 31, 2021, we issued two series of senior unsecured notes that each pay a fixed rate of interest. As of December 31, 2021, we have an aggregate balance $1.2 billion of senior unsecured notes.
•Our Senior Credit Facility agreement contains fallback language generally consistent with the ARRC's recommendation, which provides a streamlined amendment approach for negotiating a benchmark replacement.
•We continue to monitor developments by the FCA, the ARRC, and other governing bodies involved in LIBOR transition.
Refer to Item 1A. "Risk factors" in this annual report on Form 10-K for additional information about our management of risks related to the transition away from LIBOR.
Interest Rate Hedging
During and subsequent to the year ended December 31, 2021, we entered into four treasury lock contracts with an aggregate notional value of $600.0 million to hedge interest rate risk associated with future issuances of fixed-rate long-term debt.
Long-term Financing and Capital Requirements
Long-term Financing
We anticipate meeting our long-term liquidity requirements, such as scheduled debt maturities, large property acquisitions, expansion and development of properties, other nonrecurring capital improvements and Operating Partnership unit redemptions through the long-term unsecured and secured indebtedness and the issuance of certain debt or equity securities subject to market conditions.
We had unrestricted cash on hand as of December 31, 2021, of approximately $65.8 million. As of December 31, 2021, there was approximately $994.5 million of remaining capacity on the Senior Credit Facility. At December 31, 2021 we had a total of 412 unencumbered MH, RV and marina properties.
From time to time, we may also issue shares of our capital stock, issue equity units in our Operating Partnership, issue unsecured notes, obtain other debt financing or sell selected assets. Our ability to finance our long-term liquidity requirements in such a manner will be affected by numerous economic factors affecting the MH, RV and marina industries at the time, including the effects of the COVID-19 pandemic, the availability and cost of mortgage debt, our financial condition, the operating history of the properties, the state of the debt and equity markets, and the general national, regional and local economic conditions. When it becomes necessary for us to approach the credit markets, the volatility in those markets could make borrowing more difficult to secure, more expensive, or effectively unavailable. In the event our current credit ratings are downgraded, it may become difficult or more expensive to obtain additional financing or refinance existing unsecured indebtedness as maturities become due. Refer to "Risk Factors" in Part I, Item 1A of this Annual Report on Form 10-K. If we are unable to obtain additional debt or equity financing on acceptable terms, our business, results of operations and financial condition would be adversely impacted.
As of December 31, 2021, our net debt to enterprise value was approximately 18.0 percent (assuming conversion of all common OP units, Series A-1 preferred OP units, Series A-3 preferred OP units, Series C preferred OP units, Series D preferred OP units, Series E preferred OP units, Series F preferred OP units, Series G preferred OP units, Series H preferred OP units, Series I preferred OP units and Series J preferred OP units to shares of common stock). Our debt has a weighted average maturity of approximately 8.8 years and a weighted average interest rate of 3.0 percent.
SUN COMMUNITIES, INC.
Capital Requirements
Our capital requirements as of December 31, 2021 include both short and long term obligations:
Our primary long-term liquidity needs are principal payments on outstanding indebtedness as summarized in the table below:
Payments Due By Period (in thousands)
Outstanding Indebtedness(1)
Total Due Short-term Obligation
≤1 Year
Long-term Obligation After 1 Year
Refer to
Principal payments on long-term debt $ 5,698,458 $ 141,959 $ 5,556,499 Note 8. Debt and Line of Credit
Interest expense(2)
1,413,255 174,250 1,239,005
Operating leases 237,742 9,978 227,764 Note 16. Leases
Finance lease 4,408 194 4,214 Note 16. Leases
Total Outstanding Indebtedness $ 7,353,863 $ 326,381 $ 7,027,482
(1)Our outstanding indebtedness in this table excludes debt premiums, discounts and deferred financing costs, as applicable.
(2)Our obligations related to interest expense are calculated based on the current debt levels, rates and maturities as of December 31, 2021 (including finance leases), and actual payments required in future periods may be different than the amounts included above. Perpetual securities include one year of interest expense for payment due after five years.
Certain of our nonconsolidated affiliates, which are accounted for under the equity-method of accounting, have incurred indebtedness. We have not guaranteed the debt of our nonconsolidated affiliates in the arrangements referenced below, nor do we have any obligations to fund this debt should the nonconsolidated affiliates be unable to do so. Refer to Note 6, "Investments in Nonconsolidated Affiliates," in the accompanying Consolidated Financial Statements for additional information about these entities.
GTSC - During September 2019, GTSC, entered into a warehouse line of credit with a maximum loan amount of $125.0 million. During September 2020, May 2021 and December 2021, the maximum amount was increased to $180.0 million, $230.0 million and $255.0 million, respectively, with an option to increase to $275.0 million subject to the lender's consent. As of December 31, 2021, the aggregate carrying amount of debt, including both our and our partner's share, incurred by GTSC was $243.1 million (of which our proportionate share is $97.2 million). As of December 31, 2020, the aggregate carrying amount of debt, including both our and our partner's share, incurred by GTSC was $167.7 million (of which our proportionate share is $67.1 million). The debt bears interest at a variable rate based on a Commercial Paper or adjusted Secured Overnight Financing Rate plus 1.65 percent per annum and matures on December 15, 2025.
Sungenia JV - During May 2020, Sungenia JV, entered into a debt facility agreement with a maximum loan amount of $27.0 million Australian dollars, or $19.6 million converted at the December 31, 2021 exchange rate. As of December 31, 2021, the aggregate carrying amount of debt, including both our and our partners' share, incurred by Sungenia JV was $6.3 million (of which our proportionate share is $3.1 million). As of December 31, 2020, the aggregate carrying amount of debt, including both our and our partners' share, incurred by Sungenia JV was $6.7 million (of which our proportionate share is $3.3 million). The debt bears interest at a variable rate based on the BBSY rate plus 2.05 percent per annum and is available for a minimum of three years.
SUN COMMUNITIES, INC.
SIGNIFICANT ACCOUNTING POLICIES AND CRITICAL ACCOUNTING ESTIMATES
Critical Accounting Estimates
Our Consolidated Financial Statements are prepared in accordance with United States of America generally accepted accounting principles ("GAAP"), which require the use of estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses in the periods presented. We believe that the accounting estimates employed are appropriate and resulting balances are reasonable; however, due to inherent uncertainties in making estimates, actual results could differ from the original estimates, requiring adjustments to these balances in future periods.
Our significant accounting estimates include acquisitions (of investment properties) and impairment (of long live assets or properties, right-of-use assets and goodwill). Refer to Note 1, "Significant Accounting Policies," in our accompanying Consolidated Financial Statements for information regarding our critical accounting estimates that affect the Consolidated Financial Statements and that use judgments and assumptions. In addition, the likelihood that materially different amounts could be reported under varied conditions and assumptions is discussed.
Impact of New Accounting Standards
Refer to Note 18, "Recent Accounting Pronouncements," in our accompanying Consolidated Financial Statements for information regarding new accounting pronouncements.
SUN COMMUNITIES, INC.

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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Market risk is the exposure to loss resulting from changes in market factors such as interest rates, foreign currency exchange rates, commodity prices and equity prices.
Interest Rate Risk
Our principal market risk exposure is interest rate risk. We mitigate this risk by maintaining prudent amounts of leverage, minimizing capital costs, and interest expense while continuously evaluating all available debt and equity resources and following established risk management policies and procedures, which include the periodic use of derivatives. Our primary strategy in entering into derivative contracts is to minimize the variability that interest rate changes could have on our future cash flows. From time to time, we employ derivative instruments that effectively convert a portion of our variable rate debt to fixed rate debt. We do not enter into derivative instruments for speculative purposes.
Our variable rate debt totaled $1.0 billion and $1.2 billion as of December 31, 2021 and 2020, respectively, and at such dates bore interest at the Adjusted Eurocurrency Rate or BBSY rate, plus a margin, and Prime or various LIBOR rates, respectively. If the Adjusted Eurocurrency Rate or BBSY rates, and Prime or LIBOR rates increased or decreased by 1.0 percent, our interest expense would have increased or decreased by approximately $8.2 million and $3.4 million for the years ended December 31, 2021 and 2020, respectively, based on the $821.2 million and $339.5 million average balances outstanding under our variable rate debt facilities, respectively.
Foreign Currency Exchange Rate Risk
Foreign currency exchange rate risk is the risk that fluctuations in currencies against the U.S. dollar will negatively impact our results of operations. We are exposed to foreign currency exchange rate risk as a result of remeasurement and translation of the assets and liabilities of our Canadian properties, our Australian equity investment, and our United Kingdom assets and joint venture into U.S. dollars. Fluctuations in foreign currency exchange rates can therefore create volatility in our results of operations and may adversely affect our financial condition.
At December 31, 2021 and 2020, our stockholder's equity included $663.6 million and $250.8 million from our investments and operations in Canada, Australia and the United Kingdom, which collectively represented 9.9 percent and 4.5 percent of total stockholder's equity, respectively. Based on our sensitivity analysis, a 10.0 percent strengthening of the U.S. dollar against the Canadian dollar, Australian dollar and British pound would have caused a reduction of $66.4 million and $25.1 million to our total stockholder's equity at December 31, 2021 and 2020, respectively.
Capital Market Risk
We are exposed to risks related to the equity capital markets, and our related ability to raise capital through the issuance of our common stock or other equity instruments. We are also exposed to risks related to the debt capital markets, and our related ability to finance our business through borrowings under other financing arrangements. As a REIT, we are required to distribute a significant portion of our taxable income annually, which constrains our ability to accumulate operating cash flow and therefore requires us to utilize debt or equity capital to finance our business. We seek to mitigate these risks by monitoring the debt and equity capital markets to inform our decisions on the amount, timing and terms of capital we raise.
SUN COMMUNITIES, INC.

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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Financial statements and supplementary data are filed herewith under Item 15.

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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.

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ITEM 9A. CONTROLS AND PROCEDURES
ITEM 9A. CONTROLS AND PROCEDURES
Evaluation of disclosure controls and procedures
We maintain disclosure controls and procedures designed to provide reasonable assurance that information required to be disclosed in reports filed under the Exchange Act is recorded, processed, summarized and reported within the specified time periods and accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
Our management, with the participation of our CEO and CFO, evaluated the effectiveness of our disclosure controls and procedures (pursuant to Rules 13a-15(e) or 15d-15(e) of the Exchange Act) at December 31, 2021. Based upon this evaluation, our CEO and CFO concluded that our disclosure controls and procedures were effective as of December 31, 2021.
Management's report on internal control over financial reporting
Our management is responsible for establishing and maintaining effective internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. This system is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with GAAP. Because of the inherent limitations of internal control over financial reporting, including the possibility of collusion or improper management override of controls, misstatements due to error or fraud may not be prevented or detected on a timely basis.
Our management performed an assessment of the effectiveness of our internal control over financial reporting at December 31, 2021, utilizing the criteria discussed in the "Internal Control - Integrated Framework (2013)" issued by the Committee of Sponsoring Organizations of the Treadway Commission. The objective of this assessment was to determine whether our internal control over financial reporting was effective at December 31, 2021. Based on management's assessment, we have concluded that our internal control over financial reporting was effective at December 31, 2021.
The effectiveness of our internal control over financial reporting has been audited by Grant Thornton LLP, an independent registered public accounting firm, as stated in its report which is included herein.
Changes in internal control over financial reporting
There were no material changes in our internal control over financial reporting during the quarter ended December 31, 2021.

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ITEM 9B. OTHER INFORMATION
ITEM 9B. OTHER INFORMATION
None.
SUN COMMUNITIES, INC.
PART III

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ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
Pursuant to the general instructions of Item 401 of Regulation S-K, certain information regarding our executive officers is contained in Part I of this Form 10-K. Unless provided in an amendment to this Annual Report on Form 10-K, the other information required by this Item is incorporated herein by reference to the applicable information in the proxy statement for our 2022 annual meeting (the "Proxy Statement,") including the information set forth under the captions "Proposal No.1 Election of Directors - Consideration of Director Nominees," "Corporate Governance - Board of Directors," "Corporate Governance - Board of Directors - Board Structure - Committees of the Board of Directors," "Security Ownership Information - Security Ownership of Directors and Executive Officers," and "Information About Executive Officers - Executive Officers Biographies."

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ITEM 11. EXECUTIVE COMPENSATION
ITEM 11. EXECUTIVE COMPENSATION
Unless provided in an amendment to this Annual Report on Form 10-K, the information required by this Item is incorporated by reference to the applicable information in the Proxy Statement, including the information set forth under the captions "Proposal No.1 Election of Directors - Director Compensation," "Corporate Governance - Board of Directors - Board Structure - Compensation Committee Interlocks and Insider Participation," and "Compensation Discussion and Analysis." The information in the section captioned "Executive Compensation - Compensation Committee Report" in the Proxy Statement or an amendment to this Annual Report on Form 10-K is incorporated by reference herein but shall be deemed furnished, not filed, and shall not be deemed to be incorporated by reference into any filing we make under the Securities Act or the Exchange Act.

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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
Unless provided in an amendment to this Annual Report on Form 10-K, the information required by this Item is incorporated by reference to the applicable information in the Proxy Statement, including the information set forth under the captions "Security Ownership Information."

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ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
Unless provided in an amendment to this Annual Report on Form 10-K, the information required by this Item is incorporated by reference to the Proxy Statement, including the information set forth under the captions "Corporate Governance - Board of Directors," "Corporate Governance - Board of Directors - Board Structure - Committees of the Board of Directors," "Corporate Governance - Board of Directors - Board Structure - Leadership Structure and Independence of Non-Employee Directors," and "Corporate Governance - Board of Directors - Other Board Policies and Processes - Certain Relationships and Related Party Transactions."

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ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Unless provided in an amendment to this Annual Report on Form 10-K, the information required by this Item is incorporated by reference to the Proxy Statement, including the information set forth under the caption for the proposal related to "Ratification of Selection of Grant Thornton LLP."
SUN COMMUNITIES, INC.
PART IV

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ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
The following documents are filed herewith as part of this Form 10-K:
1. Financial Statements
A list of the financial statements required to be filed as a part of this Annual Report on Form 10-K is shown in the "Index to the Consolidated Financial Statements and Financial Statement Schedules" filed herewith.
2. Financial Statement Schedules
The financial statement schedules required to be filed as a part of this Annual Report on Form 10-K is shown in the "Index to the Consolidated Financial Statements and Financial Statement Schedules" filed herewith.
3. Exhibits
A list of the exhibits required by Item 601 of Regulation S-K to be filed as a part of this Annual Report on Form 10-K is filed herewith.