Reportable Segments

12 Months Ended

Dec. 31, 2013

Reportable Segments

Reportable Segments

Operating segments are defined as components of an entity for which separate financial information is available that is evaluated regularly by the chief operating decision maker. The chief operating decision maker evaluates and assesses performance on a monthly basis. Segment operating performance is measured on Net Operating Income (“NOI”). NOI is defined as total operating revenues less total operating expenses. Segments are assessed before interest income, depreciation and amortization of in-place leases.

We have two reportable segments which are: (i) the Property Operations and (ii) Home Sales and Rentals Operations Segments. The Property Operations segment owns and operates land lease Properties and the Home Sales and Rentals Operations segment purchases, sells and leases homes at the Properties.

All revenues are from external customers and there is no customer who contributed 10% or more of our total revenues during the three years ended December 31, 2013, 2012, and 2011.

Note 19—Reportable Segments (continued)

The following tables summarize our segment financial information (amounts in thousands):

Year EndedDecember 31, 2013

	Property Operations			Home Sales and Rentals Operations			Consolidated
Operations revenues	$	679,319		$	33,281		$	712,600
Operations expenses	(328,795		)	(26,855		)	(355,650		)
Income from segment operations	350,524			6,426			356,950
Interest income	3,397			4,373			7,770
Depreciation on real estate and rental homes	(101,374		)	(6,855		)	(108,229		)
Amortization of in-place leases	(1,940		)	—			(1,940		)
Income from operations	$	250,607		$	3,944		254,551
Reconciliation to Consolidated net income
Corporate interest income							490
Other revenues							7,515
General and administrative							(28,211		)
Early debt retirement							(37,844		)
Interest and related amortization							(118,522		)
Rent control initiatives and other							(2,771		)
Equity in income of unconsolidated joint ventures							2,039
Gain on sale of property, net of tax							41,525
Discontinued operations							7,133
Consolidated net income							$	125,905
Total assets	$	3,096,156		$	295,483		$	3,391,639
Capital improvements	$	26,430		$	38,284		$	64,714

Note 19—Reportable Segments (continued)

Year Ended December 31, 2012

	Property Operations			Home Sales and  Rentals Operations			Consolidated
Operations revenues	$	647,731		$	21,045		$	668,776
Operations expenses	(311,694		)	(16,778		)	(328,472		)
Income from segment operations	336,037			4,267			340,304
Interest income	3,075			4,614			7,689
Depreciation on real estate and rental homes	(96,419		)	(5,664		)	(102,083		)
Amortization of in-place leases	(38,694		)	(773		)	(39,467		)
Income from operations	$	203,999		$	2,444		206,443
Reconciliation to Consolidated net income
Corporate interest income							446
Other revenues							6,795
General and administrative							(26,388		)
Interest and related amortization							(123,992		)
Rent control initiatives and other							(1,456		)
Equity in income of unconsolidated joint ventures							1,899
Gain on sale of property, net of tax							4,596
Discontinued operations							6,116
Consolidated net income							$	74,459
Assets held for use	$	2,984,766		$	293,608		$	3,278,374
Assets held for disposition							119,852
Total assets							$	3,398,226
Capital improvements	$	30,863		$	44,397		$	75,260

Year EndedDecember 31, 2011

	Property Operations			Home Sales and  Rentals Operations			Consolidated
Operations revenues	$	550,529		$	14,104		$	564,633
Operations expenses	(275,584		)	(11,699		)	(287,283		)
Income from segment operations	274,945			2,405			277,350
Interest income	3,377			2,264			5,641
Depreciation on real estate	(78,838		)	(4,175		)	(83,013		)
Amortization of in-place leases	(22,683		)	(443		)	(23,126		)
Income from operations	$	176,801		$	51		176,852
Reconciliation to Consolidated net income
Corporate interest income							283
Other revenues							6,452
General and administrative							(42,046		)
Interest and related amortization							(99,489		)
Rent control initiatives and other							(2,043		)
Equity in income of unconsolidated joint ventures							1,948
Discontinued operations							547
Consolidated net income							$	42,504
Assets held for use	$	3,172,222		$	201,551		$	3,373,773
Assets held for disposition							122,328
Total assets							$	3,496,101
Capital improvements	$	26,224		$	35,808		$	62,032

Note 19—Reportable Segments (continued)

The following table summarizes our financial information for the Property Operations segment for the years ended December 31, 2013, 2012, and 2011 (amounts in thousands):

	December 31, 2013			December 31, 2012			December 31, 2011
Revenues:
Community base rental income	$	409,801		$	394,606		$	309,230
Resort base rental income	147,234			134,327			130,489
Right-to-use annual payments	47,967			47,662			49,122
Right-to-use contracts current period, gross	13,142			13,433			17,856
Right-to-use contracts current period, deferred	(5,694		)	(6,694		)	(11,936		)
Utility income and other	63,800			62,470			53,116
Ancillary services revenues, net	3,069			1,927			2,652
Total property operations revenues	679,319			647,731			550,529
Expenses:
Property operating and maintenance	229,897			220,415			197,781
Real estate taxes	48,279			45,590			36,528
Sales and marketing, gross	12,836			10,845			11,218
Sales and marketing deferred commissions, net	(2,410		)	(3,155		)	(4,789		)
Property management	40,193			37,999			34,846
Total property operations expenses	328,795			311,694			275,584
Income from property operations segment	$	350,524		$	336,037		$	274,945

The following table summarizes our financial information for the Home Sales and Rentals Operations segment, specific to continuing operations, for the years ended December 31, 2013, 2012, and 2011 (amounts in thousands):

	December 31, 2013		December 31, 2012		December 31, 2011
Revenues:
Gross revenue from home sales	$	17,871	$	8,230	$	6,028
Brokered resale revenues, net	1,143		1,166		831
Rental home income (a)	14,267		11,649		7,245
Total revenues	33,281		21,045		14,104
Expenses:
Cost of home sales	17,296		9,018		5,615
Home selling expenses	2,085		1,391		1,591
Rental home operating and maintenance	7,474		6,369		4,493
Total expenses	26,855		16,778		11,699
Income from home sales and rentals operations segment	$	6,426	$	4,267	$	2,405

(a) Segment information does not include Site rental income included in Community base rental income.