Real Estate Acquisitions

9 Months Ended

Sep. 30, 2020

Business Combinations [Abstract]

Real Estate Acquisitions

Real Estate Acquisitions and Dispositions

2021 Acquisitions

During the six months ended June 30, 2021, we acquired the following communities, resorts and marinas:

Community Name	Type	Sites, Wet Slips and Dry Storage Spaces	State / Province	Month Acquired
Sun Outdoors Association Island	RV: asset acquisition	294	NY	January
Blue Water Beach Resort	RV: asset acquisition	177	UT	February
Tranquility MHC	MH: asset acquisition	25	FL	February
Islamorada and Angler House(1)	Marina: asset acquisition	251	FL	February
Prime Martha's Vineyard(1)	Marina: asset acquisition	390	MA	March
Pleasant Beach Campground	RV: asset acquisition	102	ON, Canada	March
Cherrystone Family Camping Resort	RV: asset acquisition	669	VA	March
Beachwood Resort	RV: asset acquisition	672	WA	March
ThemeWorld RV Resort	RV: asset acquisition	148	FL	April
Sylvan Glen Estates(2)	MH: asset acquisition	476	MI	April
Shelter Island Boatyard	Marina: asset acquisition	55	CA	May
Lauderdale Marine Center	Marina: asset acquisition	202	FL	May
Apponaug Harbor(3)	Marina: asset acquisition	378	RI	June
Cabrillo Isle(4)	Marina: business combination	483	CA	June
Marathon Marina	Marina: asset acquisition	147	FL	June
	Total	4,469

(1) Includes two marinas.

(2) In conjunction with the acquisition, we issued 240,000 Series J preferred OP units. As of June 30, 2021, 240,000 Series J preferred OP units were outstanding.

(3) Combined with an existing adjacent marina.

(4) Acquired in connection with Safe Harbor Marinas acquisition. Transfer of the marinas was contingent on receiving third party consent.

The following table summarizes the amount of assets acquired, net of liabilities assumed at the acquisition date and the consideration paid for the MH community, RV resort and marina acquisitions completed during the six months ended June 30, 2021 (in thousands):

	At Acquisition Date										Consideration
	Investment in property		Inventory of manufactured homes, boat parts and retail related items		In-place leases, goodwill and other intangible assets		Other assets / (liabilities), net		Total identifiable assets acquired net of liabilities assumed		Cash and escrow		Temporary and permanent equity		Total consideration
Asset Acquisition
Sun Outdoors Association Island	$	14,965	$	—	$	41	$	(248)	$	14,758	$	14,758	$	—	$	14,758
Blue Water Beach Resort	9,000		—		—		(151)		8,849		8,849		—		8,849
Tranquility MHC	1,250		—		—		(1)		1,249		1,249		—		1,249
Islamorada and Angler House(1)	18,001		22		269		(317)		17,975		17,975		—		17,975
Prime Martha's Vineyard(1)	22,258		138		127		(573)		21,950		21,950		—		21,950
Pleasant Beach Campground	1,531		—		57		1		1,589		1,589		—		1,589
Cherrystone Family Camping Resort	59,669		—		231		(2,029)		57,871		57,871		—		57,871
Beachwood Resort	14,004		—		211		(7,616)		6,599		6,599		—		6,599
ThemeWorld RV Resort	25,000		—		—		(104)		24,896		24,896		—		24,896
Sylvan Glen Estates	23,469		20		531		(269)		23,751		(249)		24,000		23,751
Shelter Island Boatyard	9,520		132		402		(85)		9,969		9,969		—		9,969
Lauderdale Marine Center	336,992		—		3,282		958		341,232		341,232		—		341,232
Apponaug Harbor	6,540		—		89		(689)		5,940		5,940		—		5,940
Marathon Marina	19,129		19		261		(227)		19,182		19,182		—		19,182
Business Combination(2)
Cabrillo Isle	37,647		—		10,073		(703)		47,017		47,017		—		47,017
Total	$	598,975	$	331	$	15,574	$	(12,053)	$	602,827	$	578,827	$	24,000	$	602,827

(1) Includes two marinas.

(2) Refer to Note 5, "Goodwill and Other Intangibles Assets," for additional detail on goodwill and other intangible assets.

As of June 30, 2021, we have incurred and capitalized $5.6 million of transaction costs which have been capitalized and allocated among the various fixed asset categories for purchases that meet the asset acquisition criteria. As of June 30, 2021, we also incurred $1.0 million of business combination expenses which are expensed for purchases deemed to be business combinations.

The following unaudited pro forma financial information presents the results of our operations for the three and six months ended June 30, 2021 and 2020, as if the properties combined in 2021 had been acquired on January 1, 2020. The unaudited pro forma results reflect certain adjustments for items that are not expected to have a continuing impact, such as adjustments for transaction costs incurred, management fees and purchase accounting.

The information presented below has been prepared for comparative purposes only and does not purport to be indicative of either future results of operations or the results of operations that would have actually occurred had the acquisition been consummated on January 1, 2020 (in thousands, except per-share data):

	Three Months Ended				Six Months Ended
	June 30, 2021		June 30, 2020		June 30, 2021		June 30, 2020
Total revenues	$	605,163	$	304,552	$	1,048,426	$	616,121
Net income attributable to Sun Communities, Inc. common stockholders	$	111,075	$	59,421	$	136,258	$	43,782
Net income per share attributable to Sun Communities, Inc. common stockholders - basic	$	0.99	$	0.62	$	1.24	$	0.47
Net income per share attributable to Sun Communities, Inc. common stockholders - diluted	$	0.99	$	0.62	$	1.24	$	0.46

Real Estate Held-For-Sale

We periodically classify real estate assets as "held-for-sale." An asset is classified as held-for-sale after an active program to sell an asset has commenced and when the sale is probable. Within "Other Assets, net" on the Consolidated Balance Sheets is approximately $14.9 million of real estate held-for-sale as of June 30, 2021.

Refer to Note 18, "Subsequent Events," for information regarding real estate acquisitions and dispositions completed after June 30, 2021.

2020 Acquisitions and dispositions

For the year ended December 31, 2020, we acquired the following communities, resorts and marinas.

Community Name	Type	Sites, Wet Slips and Dry Storage Spaces	Development Sites	State	Month Acquired
Cape Cod(1)	RV: asset acquisition	230	—	MA	January
Jellystone Natural Bridge	RV: asset acquisition	299	—	VA	February
Forest Springs(2)	MH: asset acquisition	372	—	CA	May
Crown Villa	RV: asset acquisition	123	—	OR	June
Flamingo Lake	RV: asset acquisition	421	—	FL	July
Woodsmoke	RV: asset acquisition	300	—	FL	September
Jellystone Lone Star	RV: asset acquisition	344	—	TX	September
El Capitan & Ocean Mesa(3)(4)	RV: asset acquisition	266	109	CA	September
Highland Green Estates & Troy Villa(5)	MH: asset acquisition	1,162	—	MI	September
Safe Harbor Marinas(6)	Marina: business combination	37,305	—	Various	October
Safe Harbor Hideaway Bay(7)	Marina: business combination	628	—	GA	November
Gig Harbor	RV: asset acquisition	115	—	WA	November
Maine MH Portfolio(8)	MH: asset acquisition	1,083	—	ME	November
Safe Harbor Anacapa Isle(7)	Marina: business combination	453	—	CA	December
Mears Annapolis	Marina: asset acquisitions	184	—	MD	December
Wickford	Marina: asset acquisitions	60	—	RI	December
Rybovich Portfolio(9)	Marina: business combination	78	—	FL	December
Rockland	Marina: asset acquisitions	173	—	ME	December
Mouse Mountain	MH / RV: asset acquisition	304	—	FL	December
Lakeview Mobile Estates	MH: asset acquisition	296	—	CA	December
Shenandoah Acres	RV: asset acquisition	522	—	VA	December
Jellystone at Barton Lake	RV: asset acquisition	555	—	IN	December
Kittatinny Portfolio(4)	RV: asset acquisition	527	—	NY & PA	December
	Total	45,800	109

(1) In conjunction with the acquisition, we issued Series E preferred OP units. As of December 31, 2020, 90,000 Series E preferred OP units were outstanding.

(2) In conjunction with the acquisition, we issued Series F preferred OP units and common OP units. As of December 31, 2020, 90,000 Series F preferred OP units, specific to this acquisition, were outstanding.

(3) In conjunction with the acquisition, we issued Series G preferred OP units. As of December 31, 2020, 240,710 Series G preferred OP units were outstanding.

(4) Includes two RV resorts.

(5) Includes two communities.

(6) Includes 99 owned marinas located in 22 states. In conjunction with the acquisition, we issued Series H preferred OP units. As of December 31, 2020, 581,407 Series H preferred OP units were outstanding.

(7) Acquired in connection with Safe Harbor Marinas acquisition. Transfer of marinas was contingent on receiving third party consents.

(8) Includes six communities.

(9) Includes two marinas. In conjunction with the acquisition, we issued Series I preferred OP units. As of December 31, 2020, 922,000 Series I preferred OP units were outstanding.

The following table summarizes the amounts of assets acquired, net of liabilities assumed at the acquisition date and the consideration paid for the acquisitions completed in 2020 (in thousands):

	At Acquisition Date										Consideration
	Investment in property		Inventory of manufactured homes, boat parts and retail related items		Goodwill, In-place leases and other intangible assets		Other assets / (liabilities), net		Total identifiable assets acquired net of liabilities assumed		Cash and escrow		Debt assumed		Temporary and permanent equity		Total consideration
Asset Acquisition
Cape Cod	$	13,350	$	—	$	150	$	(295)	$	13,205	$	4,205	$	—	$	9,000	$	13,205
Jellystone Natural Bridge	11,364		—		80		(391)		11,053		11,053		—		—		11,053
Forest Springs	51,949		1,337		2,160		(107)		55,339		36,260		—		19,079		55,339
Crown Villa	16,792		—		—		(230)		16,562		16,562		—		—		16,562
Flamingo Lake	34,000		—		—		(155)		33,845		33,845		—		—		33,845
Woodsmoke	25,120		40		840		(461)		25,539		25,539		—		—		25,539
Jellystone Lone Star	21,000		—		—		(703)		20,297		20,297		—		—		20,297
El Capitan & Ocean Mesa	69,690		—		—		(10,321)		59,369		32,108		—		27,261		59,369
Highland Green Estates & Troy Villa	60,988		1,679		2,030		(15)		64,682		64,682		—		—		64,682
Gig Harbor	15,250		—		—		(22)		15,228		15,228		—		—		15,228
Maine MH Portfolio	79,890		—		1,359		30		81,279		72,479		8,800		—		81,279
Mears Annapolis	24,354		—		6,922		(546)		30,730		30,730		—		—		30,730
Wickford	3,468		—		42		(121)		3,389		3,389		—		—		3,389
Rockland	15,082		348		101		(368)		15,163		15,163		—		—		15,163
Mouse Mountain	15,221		—		279		(4)		15,496		15,496		—		—		15,496
Lakeview Mobile Estates	22,917		195		638		(72)		23,678		23,678		—		—		23,678
Shenandoah Acres	16,166		—		834		(197)		16,803		16,803		—		—		16,803
Jellystone at Barton Lake	23,462		—		538		(397)		23,603		23,603		—		—		23,603
Kittatinny Portfolio	16,220		—		30		29		16,279		16,279		—		—		16,279
Business Combination(1)
Safe Harbor Marinas	1,643,879		5,700		418,033		(26,831)		2,040,781		1,141,797		829,000		69,984		2,040,781
Hideaway Bay	26,218		23		7,242		(1,077)		32,406		32,406		—		—		32,406
Anacapa Isle	10,924		—		3,146		60		14,130		14,130		—		—		14,130
Rybovich Portfolio(2)	122,064		620		249,840		(37)		372,487		258,123		—		114,364		372,487
Total	$	2,339,368	$	9,942	$	694,264	$	(42,231)	$	3,001,343	$	1,923,855	$	837,800	$	239,688	$	3,001,343

(1) Refer to Note 5, "Goodwill and Other Intangibles Assets," for additional detail on goodwill and other intangible assets.

(2) Purchase price allocations were preliminary as of December 31, 2020 and were adjusted as of March 31, 2021 based on revised purchase price allocations.

As of December 31, 2020, we have incurred $23.0 million of expensed business combination transaction costs (in relation to the acquisition Safe Harbor, Hideaway Bay, Anacapa Isle, and the Rybovich Portfolio, as each such acquisition meets the criteria to be accounted for as business combination), and $13.4 million of capitalized transaction costs for asset acquisitions which have been allocated among the various categories above.

Land for Expansion / Development

During the year ended December 31, 2020, we acquired eight land parcels which are located in Orange Beach, Alabama; Jensen Beach, Florida; Citra Lakes, Florida; Comal County, Texas; and Menifee, California for total consideration of $9.7 million. Seven of the land parcels are adjacent to existing communities.

Dispositions

Real estate held-for-sale of $32.1 million as of December 31, 2020, was reclassified from Other assets, net to various line items on the Consolidated Balance Sheets during the three months ended March 31, 2021, as the sale of those assets was no longer probable. As of March 31, 2021, the primary reclassifications were $34.5 million of assets within Investment property, net and $3.8 million within Other liabilities on the Consolidated Balance Sheets.

On July 1, 2020, we sold a manufactured housing community located in Montana, containing 226 sites, for $12.6 million. The gain from the sale of the property was approximately $5.6 million.