Reportable Segments

6 Months Ended

Jun. 30, 2019

We have identified two reportable segments which are: (i) Property Operations and (ii) Home Sales and Rentals Operations. 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. The distribution of the Properties throughout the United States reflects our belief that geographic diversification helps insulate the portfolio from regional economic influences.

All revenues were from external customers and there was no customer who contributed 10% or more of our total revenues during the quarters and six months ended June 30, 2019 or 2018.

The following tables summarize our segment financial information for the quarters and six months ended June 30, 2019 and 2018:

Quarter Ended June 30, 2019



(amounts in thousands)	Property Operations			Home Sales and Rentals Operations			Consolidated
Operations revenues	$	233,848		$	11,836		$	245,684
Operations expenses	(116,893		)	(10,558		)	(127,451		)
Income from segment operations	116,955			1,278			118,233
Interest income	950			846			1,796
Depreciation and amortization	(35,197		)	(2,579		)	(37,776		)
Income (loss) from operations	$	82,708		$	(455	)	$	82,253
Reconciliation to consolidated net income:
Corporate interest income							$	7
Income from other investments, net							879
General and administrative							(9,225		)
Other expenses							(540		)
Interest and related amortization							(26,024		)
Equity in income of unconsolidated joint ventures							3,226
Early debt retirement							(1,491		)
Consolidated net income							$	49,085

Total assets	$	3,766,573		$	247,905		$	4,014,478
Capital improvements	$	28,501		$	40,502		$	69,003

Quarter Ended June 30, 2018



(amounts in thousands)	Property Operations			Home Sales and Rentals Operations			Consolidated
Operations revenues	$	222,167		$	13,060		$	235,227
Operations expenses	(110,046		)	(12,234		)	(122,280		)
Income from segment operations	112,121			826			112,947
Interest income	823			1,033			1,856
Depreciation and amortization	(31,954		)	(2,391		)	(34,345		)
Income (loss) from operations	$	80,990		$	(532	)	$	80,458
Reconciliation to consolidated net income:
Corporate interest income							$	6
Income from other investments, net							3,413
General and administrative							(9,669		)
Other expenses							(367		)
Interest and related amortization							(26,285		)
Equity in income of unconsolidated joint ventures							1,613
Consolidated net income							$	49,169

Total assets	$	3,477,455		$	222,734		$	3,700,189
Capital improvements	$	26,602		$	23,459		$	50,061

Six Months Ended June 30, 2019



(amounts in thousands)	Property Operations			Home Sales and Rentals Operations			Consolidated
Operations revenues	$	479,864		$	22,173		$	502,037
Operations expenses	(225,863		)	(19,477		)	(245,340		)
Income from segment operations	254,001			2,696			256,697
Interest income	1,844			1,696			3,540
Depreciation and amortization	(70,740		)	(5,013		)	(75,753		)
Gain on sale of real estate, net	52,507			—			52,507
Income (loss) from operations	$	237,612		$	(621	)	$	236,991
Reconciliation to consolidated net income:
Corporate interest income							$	14
Income from other investments, net							1,865
General and administrative							(19,134		)
Other expenses							(967		)
Interest and related amortization							(52,417		)
Equity in income of unconsolidated joint ventures							4,759
Early debt retirement							(1,491		)
Consolidated net income							$	169,620

Total assets	$	3,766,573		$	247,905		$	4,014,478
Capital improvements	$	52,906		$	68,538		$	121,444

Six Months Ended June 30, 2018



(amounts in thousands)	Property Operations			Home Sales and Rentals Operations			Consolidated
Operations revenues	$	453,183		$	25,179		$	478,362
Operations expenses	(215,558		)	(23,307		)	(238,865		)
Income from segment operations	237,625			1,872			239,497
Interest income	1,631			1,940			3,571
Depreciation and amortization	(56,029		)	(10,690		)	(66,719		)
Income (loss) from operations	$	183,227		$	(6,878	)	$	176,349
Reconciliation to consolidated net income:
Corporate interest income							$	241
Income from other investments, net							4,353
General and administrative							(17,707		)
Other expenses							(710		)
Interest and related amortization							(51,988		)
Equity in income of unconsolidated joint venture							2,808
Consolidated net income							$	113,346

Total assets	$	3,477,455		$	222,734		$	3,700,189
Capital Improvements	$	47,870		$	33,507		$	81,377

The following table summarizes our financial information for the Property Operations segment for the quarters and six months ended June 30, 2019 and 2018:



	Quarters Ended June 30,						Six Months Ended June 30,
(amounts in thousands)	2019			2018			2019			2018
Revenues:
Rental income	$	208,375		$	195,594		$	428,357		$	399,072
Right-to-use annual payments (membership subscriptions)	12,586			11,891			24,902			23,410
Right-to-use contracts current period, gross (membership upgrade sales)	5,041			3,944			8,879			7,106
Right-to-use contract upfront payments, deferred, net	(2,912		)	(2,021		)	(4,683		)	(3,306		)
Other income	10,265			12,536			20,635			25,572
Ancillary services revenues, net	493			223			1,774			1,329
Total property operations revenues	233,848			222,167			479,864			453,183
Expenses:
Property operating and maintenance	83,576			80,091			160,320			154,999
Real estate taxes	15,107			13,440			30,430			27,575
Sales and marketing, gross	4,214			3,305			7,623			6,117
Right-to-use contract commissions, deferred, net	(389		)	(262		)	(580		)	(286		)
Property management	14,385			13,472			28,070			27,153
Total property operations expenses	116,893			110,046			225,863			215,558
Income from property operations segment	$	116,955		$	112,121		$	254,001		$	237,625

The following table summarizes our financial information for the Home Sales and Rentals Operations segment for the quarters and six months ended June 30, 2019 and 2018:



	Quarters Ended June 30,				Six Months Ended June 30,
(amounts in thousands)	2019		2018		2019		2018
Revenues:
Rental income ^(a)	$	3,632	$	3,561	$	7,216	$	7,076
Gross revenue from home sales	7,825		9,105		14,300		17,414
Brokered resale revenues, net	379		369		657		651
Ancillary services revenues, net	—		25		—		38
Total revenues	11,836		13,060		22,173		25,179
Expenses:
Property operating and maintenance	1,292		1,629		2,496		3,053
Cost of home sales	8,164		9,632		14,796		18,206
Home selling expenses	1,102		973		2,185		2,048
Total expenses	10,558		12,234		19,477		23,307
Income from home sales and rentals operations segment	$	1,278	$	826	$	2,696	$	1,872

______________________

(a)

Segment information includes income related to rental homes. Income related to Site rent on rental homes is included within property operations.