Investment in Real Estate

Land improvements consist primarily of improvements such as infrastructure items, such as streets, sidewalks or water mains, as well as grading and landscaping. Buildings and other depreciable property consist of buildings on the Properties such as clubhouses, laundry facilities, maintenance storage facilities, rental units and furniture, fixtures, equipment, and in-place leases.

Acquisitions

All acquisitions have been accounted for utilizing the acquisition method of accounting in accordance with FASB ASC 805 and, accordingly, the results of operations of acquired assets are included in the statements of operations from the dates of acquisition. Certain purchase price adjustments may be made within one year following the acquisition and applied retroactively to the date of acquisition.

In January 2014, we completed the acquisition of two resort properties, Blackhawk Resort, a 490-Site Property and Lakeland Resort, a 682-Site Property. On December 17, 2013, we closed on the acquisition of Neshonoc Resort, a 284-Site Property. The portfolio purchase price of $31.8 million was funded with available cash and the assumption of mortgage debt of approximately $18.7 million, excluding note premiums of $1.3 million.

On March 10, 2014, we exercised a purchase option and purchased land comprising a portion of our Colony Cove Property which was part of our 2011 Hometown acquisition. The total purchase price of $35.9 million was funded with available cash. In connection with the acquisition of the land, we terminated the ground lease related to the Property. During the quarter ended March 31, 2014, we received the final distribution of 51,290 shares of our common stock from the escrow funded by the seller.

During the year ended December 31, 2013, we acquired Fiesta Key, a resort Property with 324 Sites for a purchase price of approximately $24.6 million funded with available cash. We also acquired three manufactured home communities located in the Chicago metropolitan area collectively containing approximately 1,207 Sites for a stated purchase price of $102.0 million. The purchase price was funded with approximately $9.7 million of limited partnership interests in our Operating Partnership, equivalent to 240,969 OP units, and the remainder was funded with available cash.

The following table summarizes the estimated fair value of the assets acquired and liabilities assumed in the acquisitions for the six months ended June 30, 2014 and year ended December 31, 2013, which we determined using Level two and Level three inputs (amounts in thousands):



	Six Months Ended June 30, 2014		Year Ended December 31, 2013
Assets acquired
Land	$	40,807	$	41,022
Depreciable property	20,632		87,306
Manufactured homes	769		1,155
In-place leases	773		3,910
Net investment in real estate	$	62,981	$	133,393
Other Assets	$	1,197	$	1,025
Total Assets acquired	$	64,178	$	134,418

Liabilities assumed
Mortgage notes payable	14,230		5,382
Other liabilities	2,757		1,777
Total Liabilities assumed	16,987		7,159
Net assets acquired	$	47,191	$	127,259

Dispositions and real estate held for disposition

During the year ended December 31, 2013, we closed on the sale of 11 manufactured home communities located in Michigan (the “Michigan Properties”) collectively containing approximately 5,344 sites for a net purchase price of approximately $165.0 million.

Results of operations for the Michigan Properties have been presented separately as discontinued operations for the quarter and six months ended June 30, 2013 in the Consolidated Statements of Income and Comprehensive Income. The following table summarizes the components of income and expense relating to discontinued operations for the quarter and six months ended June 30, 2013 (amounts in thousands):



	Quarter Ended			Six Months Ended
	June 30, 2013			June 30, 2013
Community base rental home income	$	5,080		$	10,117
Rental income	849			1,620
Utility and other income	515			997
Discontinued property operating revenues	6,444			12,734
Property operating expenses	2,473			4,923
Income from discontinued property operations	3,971			7,811
Loss from home sales operations	(40		)	(75		)
Other income and expenses	137			293
Interest and amortization	(131		)	(260		)
Depreciation and in place lease amortization	(772		)	(1,536		)
Discontinued operations, net	$	3,165		$	6,233

During the year ended December 31, 2013, we recognized approximately $1.0 million of gain on the sale of a property as a result of a new U.S. Federal tax law that eliminated a previously accrued built-in-gain tax liability related to the disposition of the Cascade property during 2012.

As of June 30, 2014, we have no properties designated as held for disposition pursuant to FASB ASC 360-10-35.

On May 7, 2014, we entered into a settlement agreement with the Arizona Department of Transportation related to the value of certain property taken for state highway purposes at our Seyenna Vista property in Maricopa County, Arizona. The payment for the condemned property was approximately $2.2 million. We received payment of $2.1 million in July 2014 and estimate a gain of approximately $0.9 million will be recognized in the third quarter. During the second quarter, we received a payment of $0.1 million to cover the costs of moving ten manufactured homes to another property.