Sun Communities (SUI) 8-K Results of Operations and Financial Condition

Table of Contents                    

Summary - Earnings Press Release	i - v
Investor Information	1
Portfolio Overview	2
Financial Information
Balance Sheets	3
Statements of Operations	4 - 5
Outstanding Securities and Capitalization	6
Reconciliations to Non-GAAP Financial Measures	7
Reconciliation of Net Income / (Loss) to Funds from Operations	8
Reconciliation of Net Income / (Loss) to Recurring EBITDA	9
Reconciliation of Net Income / (Loss) to Net Operating Income	10
Non-GAAP and Other Financial Measures	11
Financial Highlights	12
Debt Analysis	13
Selected Financial Information
Statements of Operations – Same Community	14
Rental Program Summary	15
Home Sales Summary	16
Acquisitions Summary	17
Other Information
Property Summary	18 - 19
Capital Improvements, Development, and Acquisitions	20
Operating Statistics for Manufactured Homes and Annual/Seasonal RV’s	21
Footnotes and Definitions	22 - 24

NEWS RELEASE

July 26, 2017

Sun Communities, Inc. Reports 2017 Second Quarter Results

Southfield, Michigan, July 26, 2017 – Sun Communities, Inc. (NYSE: SUI) (the "Company"), a real estate investment trust ("REIT") that owns and operates, or has an interest in, manufactured housing ("MH") and recreational vehicle ("RV") communities, today reported its second quarter results.

Financial Results for the Quarter and Six Months Ended June 30, 2017

For the quarter ended June 30, 2017, total revenues increased $47.1 million, or 24.7 percent, to $237.9 million compared to $190.8 million for the same period in 2016. Net income attributable to common stockholders was $12.4 million, or $0.16 per diluted common share, as compared to net loss attributable to common stockholders of $7.8 million, or $0.12 net loss per diluted common share, for the same period in 2016.

For the six months ended June 30, 2017, total revenues increased $106.9 million, or 29.2 percent, to $472.3 million compared to $365.4 million for the same period in 2016. Net income attributable to common stockholders was $33.5 million, or $0.45 per diluted common share, as compared to net income attributable to common stockholders of $0.1 million, or $0.00 per diluted common share, for the same period in 2016.

Non-GAAP Financial Measures and Portfolio Performance

• Funds from Operations ("FFO")⁽¹⁾ excluding certain items was $0.96 per diluted share and OP unit ("Share") for the quarter ended June 30, 2017 as compared to $0.85 for the same period in 2016, an increase of 12.9 percent.

• Revenue producing sites increased by 752 sites for the quarter ended June 30, 2017, as compared to an increase of 501 sites in the same period in 2016.

• Home sales volumes increased by 6.8 percent for the quarter ended June 30, 2017 as compared to the same period in 2016.

• Same Community Net Operating Income ("NOI")⁽¹⁾ increased by 6.1 percent for the quarter ended June 30, 2017 as compared to the same period in 2016.

• Same Community occupancy increased 160 basis points to 97.2 percent, as compared to 95.6 percent⁽¹⁰⁾ at June 30, 2016.

“Our second quarter performance demonstrates our ongoing commitment to deliver consistent operational results, while positioning ourselves for continued growth. Solid occupancy gains, stable rate increases and robust home sales all contributed to the quarter’s performance,” said Gary A. Shiffman, Chairman and Chief Executive Officer. “On the capital side, we further strengthened our balance sheet from both a debt and equity perspective. With a sizable expansion platform and an active acquisition pipeline, we expect to continue to drive attractive growth.”

i

OPERATING HIGHLIGHTS

Community Occupancy

Total portfolio occupancy was 96.1 percent at both June 30, 2017 and June 30, 2016, including the impact of recently completed but vacant expansion sites. During the quarter ended June 30, 2017, revenue producing sites increased by 752 sites, as compared to 501 revenue producing sites gained during the second quarter of 2016.

Revenue producing sites increased by 1,439 for the six months ended June 30, 2017 as compared to 1,093 revenue producing sites gained during the six months ended June 30, 2016.

Same Community Results

For the 231 communities owned since January 1, 2016, NOI⁽¹⁾ for the quarter ended June 30, 2017 increased 6.1 percent over the same period in 2016, driven by a 6.2 percent increase in revenues and a 6.3 percent increase in operating expenses.  Same community occupancy increased to 97.2 percent at June 30, 2017 from 95.6 percent⁽¹⁰⁾ at June 30, 2016.

For the six months ended June 30, 2017, total revenues increased by 5.7 percent while total expenses increased by 3.8 percent, resulting in an increase to NOI⁽¹⁾ of 6.4 percent over the six months ended June 30, 2016.

Home Sales

Total home sales were 801 for the quarter ended June 30, 2017 as compared to 750 homes sold during the same period in 2016, a 6.8 percent increase.

Rental homes sales, which are included in total home sales, were 302 and 278 for the quarters ended June 30, 2017 and 2016, respectively.

During the six months ended June 30, 2017, 1,627 homes were sold compared to 1,515 for the same period ending 2016. Rental home sales, which are included in total home sales, were 542 and 572 for the six months ended June 30, 2017 and 2016, respectively.

BALANCE SHEET AND CAPITAL MARKETS ACTIVITY

Debt Transactions

During the quarter ended June 30, 2017, as previously announced, the Company amended and restated its credit agreement with Citibank, N.A. and certain other lenders. Pursuant to the amendments, the Company can borrow up to $550.0 million under a revolving loan and $100.0 million under a term loan (the "Facility"). The Facility has a four-year term, and replaced the Company's $450.0 million credit facility that was scheduled to mature in August 2019. The Facility bears interest at a floating rate based on the Eurodollar rate plus a margin that can range from 1.35 percent to 2.20 percent for the revolving loan and 1.30 percent to 2.15 percent for the term loan. The Company may borrow up to $100.0 million on the term loan on or before September 30, 2017.

ii

Additionally, during the quarter, the Company completed a $77.0 million secured borrowing that bears interest at a fixed rate of 4.16 percent and has a 25-year term. The Company also repaid a $3.9 million mortgage loan that had an interest rate of 6.54 percent that was due to mature in August 2017.

As of June 30, 2017, the Company had approximately $3.0 billion of debt outstanding. The weighted average interest rate was 4.56 percent and the weighted average maturity was 8.7 years. The Company had $241.6 million of unrestricted cash on hand. At period-end the Company’s net debt to trailing twelve month Recurring EBITDA⁽¹⁾ ratio was 6.0 times.

Equity Transactions

During the quarter ended June 30, 2017, the Company closed an underwritten registered public offering of 4,830,000 shares of common stock at a gross price of $86.00 per share. Proceeds from the offering were $408.9 million after deducting expenses related to the offering. The Company utilized proceeds from the offering to fully repay borrowings outstanding on its senior revolving credit facility, redeem certain preferred securities, and fund an acquisition.

The Company also sold 400,000 shares of common stock through its At-the-Market equity sales program ("ATM") at a weighted average price of $85.01 during the quarter ended June 30, 2017. Net proceeds from the sales were $33.6 million.

During the quarter ended June 30, 2017, the Company redeemed 438,448 shares of 6.50% Series A-4 Cumulative Convertible Preferred Stock and 200,000 Series A-4 preferred OP units from certain entities affiliated with the sellers under the Company's previous acquisition of the American Land Lease portfolio for total consideration of $24.7 million.

PORTFOLIO ACTIVITY

Acquisitions⁽²⁾ 

During the quarter ended June 30, 2017, as previously announced, the Company acquired an undeveloped parcel of land near the ocean in Myrtle Beach, South Carolina, for total consideration of $5.9 million. This land parcel has been successfully entitled and zoned to build a 775 site RV resort.

During the quarter, the Company acquired a 489 site RV resort located in Hillsdale, Illinois and a 458 site MH community in Superior Township, Michigan, for total consideration of approximately $25.0 million.

GUIDANCE 2017

The Company is updating its 2017 full year guidance of FFO⁽¹⁾ per Share to be in the range of $4.12 to $4.18. The revised guidance reflects the impacts of the May equity offering and ATM issuances of $(0.12) per Share, and year to date outperformance of the portfolio and contribution from completed acquisitions of $0.06 per Share. The Company anticipates FFO⁽¹⁾ per Share of $1.11 to $1.14 for the third quarter and $0.95 to $0.98 for the fourth quarter.

The Company affirms 2017 full year guidance of Same Community NOI⁽¹⁾ growth of 6.4 percent to 6.8 percent. Guidance does not include prospective acquisitions or capital markets activity.

iii

FFO⁽¹⁾ per Share estimates assume certain non-core items are adjusted from FFO⁽¹⁾. The estimates and assumptions presented above represent a range of possible outcomes and may differ materially from actual results. The estimates and assumptions are forward looking based on the Company's current assessment of economic and market conditions, as well as other risks outlined below under the caption "Forward-Looking Statements."

EARNINGS CONFERENCE CALL

A conference call to discuss second quarter operating results will be held on Thursday, July 27, 2017at 11:00 A.M. (ET). To participate, call toll-free 877-407-9039. Callers outside the U.S. or Canada can access the call at 201-689-8470. A replay will be available following the call through August 10, 2017 and can be accessed toll-free by calling 844-512-2921 or by calling 412-317-6671. The Conference ID number for the call and the replay is 13661890. The conference call will be available live on Sun Communities' website www.suncommunities.com. Replay will also be available on the website.

Sun Communities, Inc. is a REIT that, as of June 30, 2017, owned or had an interest in a portfolio of 344 communities comprising approximately 120,000 developed sites in 29 states and Ontario, Canada.

For more information about Sun Communities, Inc., please visit the website at www.suncommunities.com.

CONTACT

Please address all inquiries to our investor relations department at our website www.suncommunities.com, by phone (248) 208-2500, by email investorrelations@suncommunities.com or by mail Sun Communities, Inc. Attn: Investor Relations, 27777 Franklin Road, Ste. 200, Southfield, MI 48034.

Forward-Looking Statements

This press release contains various "forward-looking statements" within the meaning of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended, and the Company intends that such forward-looking statements will be subject to the safe harbors created thereby. Forward-looking statements can be identified by words such as "will," "may," "could," "expect," "anticipate," "believes," "intends," "should," "plans," "estimates," "approximate," "guidance," and similar expressions in this press release that predict or indicate future events and trends and that do not report historical matters.

These forward-looking statements reflect the Company’s current views with respect to future events and financial performance, but involve known and unknown risks, uncertainties, and other factors, some of which are beyond the Company's control. These risks, uncertainties, and other factors may cause the actual results of the Company to be materially different from any future results expressed or implied by such forward-looking statements. Such risks and uncertainties include national, regional and local economic climates, the ability to maintain rental rates and occupancy levels, competitive market forces, the performance of recent acquisitions, the ability to integrate future acquisitions smoothly and efficiently, changes in market rates of interest, changes in foreign currency exchange rates, the ability of manufactured home buyers to obtain financing and the level of repossessions by manufactured home lenders. Further details of potential risks that may affect the Company are described in our periodic reports filed with the U.S. Securities and Exchange Commission, including in the "Risk Factors" section of the Company's Annual Report on Form 10-K for the year ended December 31, 2016.

The forward-looking statements contained in this press release speak only as of the date hereof and the Company expressly disclaims any obligation to provide public updates, revisions or amendments to any forward-looking statements made herein to reflect changes in the Company’s assumptions, expectations of future events, or trends.

iv

Investor Information                        

RESEARCH COVERAGE
Firm	Analyst	Phone	Email
Bank of America Merrill Lynch	Joshua Dennerlein	(646) 855-1681	joshua.dennerlein@baml.com
BMO Capital Markets	John Kim	(212) 885-4115	johnp.kim@bmo.com
Citi Research	Michael Bilerman	(212) 816-1383	michael.bilerman@citi.com
	Nicholas Joseph	(212) 816-1909	nicholas.joseph@citi.com
Evercore ISI	Steve Sakwa	(212) 446-9462	steve.sakwa@evercoreisi.com
	Gwen Clark	(212) 446-5611	gwen.clark@evercoreisi.com
Green Street Advisors	Ryan Burke	(949) 640-8780	rburke@greenstreetadvisors.com
RBC Capital Markets	Neil Malkin	(440) 715-2651	neil.malkin@rbccm.com
Robert W. Baird & Co.	Drew Babin	(610) 238-6634	dbabin@rwbaird.com
Wells Fargo	Todd Stender	(562) 637-1371	todd.stender@wellsfargo.com
INQUIRIES
Sun Communities welcomes questions or comments from stockholders, analysts, investment managers, media, or any prospective investor. Please address all inquiries to our Investor Relations department.
At Our Website	www.suncommunities.com
By Email	investorrelations@suncommunities.com
By Phone	(248) 208-2500

2nd Quarter 2017 Supplemental Information     1          Sun Communities, Inc.

Portfolio Overview                            

(As of June 30, 2017)

2nd Quarter 2017 Supplemental Information     2          Sun Communities, Inc.

Balance Sheets                                                

(amounts in thousands)

	6/30/2017			12/31/2016
ASSETS:
Land	$	1,066,792		$	1,051,536
Land improvements and buildings	4,934,110			4,825,043
Rental homes and improvements	507,362			489,633
Furniture, fixtures and equipment	137,546			130,127
Investment property	6,645,810			6,496,339
Accumulated depreciation	(1,128,671		)	(1,026,858		)
Investment property, net	5,517,139			5,469,481
Cash and cash equivalents	241,646			8,164
Inventory of manufactured homes	25,582			21,632
Notes and other receivables, net	110,499			81,179
Collateralized receivables, net (3)	138,696			143,870
Other assets, net	145,151			146,450
Total assets	$	6,178,713		$	5,870,776
LIABILITIES:
Mortgage loans payable	$	2,832,819		$	2,819,567
Secured borrowings (3)	139,496			144,477
Preferred OP units - mandatorily redeemable	45,903			45,903
Lines of credit	435			100,095
Distributions payable	56,283			51,896
Other liabilities	298,759			279,667
Total liabilities	3,373,695			3,441,605
Series A-4 preferred stock	32,414			50,227
Series A-4 preferred OP units	11,051			16,717
STOCKHOLDERS' EQUITY:
Series A preferred stock	34			34
Common stock	790			732
Additional paid-in capital	3,780,599			3,321,441
Accumulated other comprehensive loss	(981		)	(3,181		)
Distributions in excess of accumulated earnings	(1,089,428		)	(1,023,415		)
Total SUI stockholders' equity	2,691,014			2,295,611
Noncontrolling interests:
Common and preferred OP units	67,135			69,598
Consolidated variable interest entities	3,404			(2,982		)
Total noncontrolling interest	70,539			66,616
Total stockholders' equity	2,761,553			2,362,227
Total liabilities & stockholders' equity	$	6,178,713		$	5,870,776

2nd Quarter 2017 Supplemental Information     3          Sun Communities, Inc.

Statements of Operations - Quarter to Date Comparison                        

(amounts in thousands, except per share amounts)

	Three Months Ended June 30,
	2017			2016			Change			% Change
REVENUES
Income from real property (excluding transient revenue)	$	163,770		$	129,117		$	34,653		26.8	%
Transient revenue	15,691			10,884			4,807			44.2	%
Revenue from home sales	30,859			26,039			4,820			18.5	%
Rental home revenue	12,678			11,957			721			6.0	%
Ancillary revenues	8,850			7,383			1,467			19.9	%
Interest	5,043			4,672			371			7.9	%
Brokerage commissions and other revenues, net	1,008			747			261			34.9	%
Total revenues	237,899			190,799			47,100			24.7	%
EXPENSES
Property operating and maintenance	53,446			37,067			16,379			44.2	%
Real estate taxes	13,126			10,153			2,973			29.3	%
Cost of home sales	22,022			18,684			3,338			17.9	%
Rental home operating and maintenance	4,944			5,411			(467		)	(8.6	)%
Ancillary expenses	7,058			5,599			1,459			26.1	%
Home selling expenses	2,990			2,460			530			21.5	%
General and administrative	19,989			16,543			3,446			20.8	%
Transaction costs	2,437			20,979			(18,542		)	(88.4	)%
Depreciation and amortization	62,721			49,670			13,051			26.3	%
Extinguishment of debt	293			—			293			N/A
Interest	32,358			28,428			3,930			13.8	%
Interest on mandatorily redeemable preferred OP units	787			787			—			—	%
Total expenses	222,171			195,781			26,390			13.5	%
Income / (loss) before other items	15,728			(4,982		)	20,710			415.7	%
Other income, net (4)	875			—			875			N/A
Current tax benefit / (expense)	7			(56		)	63			112.5	%
Deferred tax benefit	364			—			364			N/A
Net income / (loss)	16,974			(5,038		)	22,012			436.9	%
Less: Preferred return to preferred OP units	(1,196		)	(1,263		)	67			(5.3	)%
Less: Amounts attributable to noncontrolling interests	(1,315		)	695			(2,010		)	(289.2	)%
Less: Preferred stock distribution	(2,099		)	(2,197		)	98			(4.5	)%
NET INCOME / (LOSS) ATTRIBUTABLE TO SUI	$	12,364		$	(7,803	)	$	20,167		258.5	%
Weighted average common shares outstanding:
Basic	74,678			64,757			9,921			15.3	%
Diluted	75,154			64,757			10,397			16.1	%
Earnings / (loss) per share:
Basic	$	0.16		$	(0.12	)	$	0.28		233.3	%
Diluted	$	0.16		$	(0.12	)	$	0.28		233.3	%

2nd Quarter 2017 Supplemental Information     4          Sun Communities, Inc.

Statements of Operations - Year to Date Comparison                            

(amounts in thousands, except per share amounts)

	Six Months Ended June 30,
	2017			2016			Change			% Change
REVENUES:
Income from real property (excluding transient revenue)	$	325,646		$	248,201		$	77,445		31.2	%
Transient revenue	36,869			21,035			15,834			75.3	%
Revenue from home sales	58,122			50,776			7,346			14.5	%
Rental home revenue	25,017			23,665			1,352			5.7	%
Ancillary revenues	15,069			11,996			3,073			25.6	%
Interest	9,689			8,617			1,072			12.4	%
Brokerage commissions and other revenues, net	1,887			1,153			734			63.7	%
Total revenues	472,299			365,443			106,856			29.2	%
EXPENSES:
Property operating and maintenance	100,612			68,268			32,344			47.4	%
Real estate taxes	26,269			19,738			6,531			33.1	%
Cost of home sales	42,905			36,868			6,037			16.4	%
Rental home operating and maintenance	10,046			11,287			(1,241		)	(11.0	)%
Ancillary expenses	11,726			9,248			2,478			26.8	%
Home selling expenses	6,101			4,597			1,504			32.7	%
General and administrative	37,921			30,335			7,586			25.0	%
Transaction costs	4,823			23,700			(18,877		)	(79.7	)%
Depreciation and amortization	125,487			98,082			27,405			27.9	%
Extinguishment of debt	759			—			759			N/A
Interest	63,680			54,722			8,958			16.4	%
Interest on mandatorily redeemable preferred OP units	1,571			1,574			(3		)	(0.2	)%
Total expenses	431,900			358,419			73,481			20.5	%
Income before other items	40,399			7,024			33,375			475.2	%
Other income, net (4)	1,627			—			1,627			N/A
Current tax expense	(171		)	(284		)	113			39.8	%
Deferred tax benefit	664			—			664			N/A
Net income	42,519			6,740			35,779			530.9	%
Less: Preferred return to preferred OP units	(2,370		)	(2,536		)	166			(6.6	)%
Less: Amounts attributable to noncontrolling interests	(2,403		)	419			(2,822		)	(673.5	)%
Less: Preferred stock distribution	(4,278		)	(4,551		)	273			(6.0	)%
NET INCOME ATTRIBUTABLE TO SUI	$	33,468		$	72		33,396			46,383.3	%
Weighted average common shares outstanding:
Basic	73,677			61,247			12,430			20.3	%
Diluted	74,272			61,673			12,599			20.4	%
Earnings per share:
Basic	$	0.45		$	0.00		$	0.45		N/A
Diluted	$	0.45		$	0.00		$	0.45		N/A

2nd Quarter 2017 Supplemental Information     5          Sun Communities, Inc.

Outstanding Securities and Capitalization        

(in thousands except for *)

Outstanding Securities - As of June 30, 2017
	Number of Units/Shares Outstanding	Conversion Rate*	If Converted	Issuance Price per unit*	Annual Distribution Rate*
Convertible Securities
Series A-1 preferred OP units	361	2.4390	880	$100	6.0%
Series A-3 preferred OP units	40	1.8605	74	$100	4.5%
Series A-4 preferred OP units	429	0.4444	191	$25	6.5%
Series C preferred OP units	328	1.1100	364	$100	4.5%
Common OP units	2,770	1.0000	2,770	N/A	Mirrors common shares distributions
Series A-4 cumulative convertible preferred stock	1,085	0.4444	482	$25	6.5%
Non-Convertible Securities
Preferred stock (SUI-PrA)	3,400	N/A	N/A	$25	7.125%
Common shares	78,987	N/A	N/A	N/A	$2.68^
^ Annual distribution is based on the last quarterly distribution annualized.

Capitalization - As of June 30, 2017
Equity	Shares	Share Price*		Total
Common shares	78,987	$	87.69	$	6,926,370
Common OP units	2,770	$	87.69	242,901
Subtotal	81,757			$	7,169,271
Series A-1 preferred OP units	880	$	87.69	77,167
Series A-3 preferred OP units	74	$	87.69	6,489
Series A-4 preferred OP units	191	$	87.69	16,749
Series C preferred OP units	364	$	87.69	31,919
Total diluted shares outstanding	83,266			$	7,301,595
Debt
Mortgage loans payable				$	2,832,819
Secured borrowings (3)				139,496
Preferred OP units - mandatorily redeemable				45,903
Lines of credit				435
Total Debt				$	3,018,653
Preferred
Perpetual preferred	3,400	$	25.00	$	85,000
A-4 preferred stock	1,085	$	25.00	$	27,125
Total Capitalization				$	10,432,373

2nd Quarter 2017 Supplemental Information     6          Sun Communities, Inc.

Reconciliations to Non-GAAP Financial Measures

2nd Quarter 2017 Supplemental Information     7          Sun Communities, Inc.

Reconciliation of Net Income / (Loss) Attributable to Sun Communities, Inc. Common Stockholders to Funds from Operations                            

(amounts in thousands except for per share data)

	Three Months Ended  June 30,						Six Months Ended  June 30,
	2017			2016			2017			2016
Net income / (loss) attributable to Sun Communities, Inc. common stockholders	$	12,364		(7,803		)	$	33,468		$	72
Adjustments:
Depreciation and amortization	62,842			49,340			125,659			97,416
Amounts attributable to noncontrolling interests	1,202			(779		)	2,102			(430		)
Preferred return to preferred OP units	586			618			1,172			1,243
Preferred distribution to Series A-4 preferred stock	560			—			1,225			—
Gain on disposition of assets, net	(4,352		)	(3,903		)	(7,033		)	(7,558		)
FFO attributable to Sun Communities, Inc. common stockholders and dilutive convertible securities (1) (6)	73,202			37,473			156,593			90,743
Adjustments:
Transaction costs	2,437			20,979			4,823			23,700
Other acquisition related costs (5)	1,525			—			2,369			—
Extinguishment of debt	293			—			759			—
Other income, net (4)	(875		)	—			(1,627		)	—
Debt premium write-off	(24		)	—			(438		)	—
Deferred tax benefit	(364		)	—			(664		)	—
FFO attributable to Sun Communities, Inc. common stockholders and dilutive convertible securities excluding certain items (1) (6)	$	76,194		$	58,452		$	161,815		$	114,443
Weighted average common shares outstanding - basic:	74,678			64,757			73,677			61,247
Add:
Common stock issuable upon conversion of stock options	2			9			2			9
Restricted stock	474			444			593			417
Common OP units	2,757			2,863			2,756			2,863
Common stock issuable upon conversion of Series A-1 preferred OP units	882			933			887			939
Common stock issuable upon conversion of Series A-3 preferred OP units	75			75			75			75
Common stock issuable upon conversion of Series A-4 preferred stock	645			—			690			—
Weighted average common shares outstanding - fully diluted	79,513			69,081			78,680			65,550
FFO attributable to Sun Communities, Inc. common stockholders and dilutive convertible securities (1) (6) per share - fully diluted	$	0.92		$	0.54		$	1.99		$	1.38
FFO attributable to Sun Communities, Inc. common stockholders and dilutive convertible securities (1) (6) per share excluding certain items - fully diluted	$	0.96		$	0.85		$	2.06		$	1.75

2nd Quarter 2017 Supplemental Information     8          Sun Communities, Inc.

Reconciliation of Net Income / (Loss) Attributable to Sun Communities, Inc. Common Stockholders to Recurring EBITDA

(amounts in thousands)

	Three Months Ended June 30,						Six Months Ended June 30,
	2017			2016			2017			2016
Net income / (loss) attributable to Sun Communities, Inc., common stockholders	$	12,364		$	(7,803	)	$	33,468		$	72
Interest	32,358			28,428			63,680			54,722
Interest on mandatorily redeemable preferred OP units	787			787			1,571			1,574
Depreciation and amortization	62,721			49,670			125,487			98,082
Extinguishment of debt	293			—			759			—
Transaction costs	2,437			20,979			4,823			23,700
Other income, net (4)	(875		)	—			(1,627		)	—
Current tax (benefit) / expense	(7		)	56			171			284
Deferred tax benefit	(364		)	—			(664		)	—
Preferred return to preferred OP units	1,196			1,263			2,370			2,536
Amounts attributable to noncontrolling interests	1,315			(695		)	2,403			(419		)
Preferred stock distributions	2,099			2,197			4,278			4,551
RECURRING EBITDA (1)	$	114,324		$	94,882		$	236,719		$	185,102

2nd Quarter 2017 Supplemental Information     9          Sun Communities, Inc.

Reconciliation of Net Income / (Loss) Attributable to Sun Communities, Inc. Common Stockholders to Net Operating Income

(amounts in thousands)

	Three Months Ended June 30,						Six Months Ended   June 30,
	2017			2016			2017			2016
Net income / (loss) attributable to Sun Communities, Inc., common stockholders:	$	12,364		$	(7,803	)	$	33,468		$	72
Other revenues	(6,051		)	(5,419		)	(11,576		)	(9,770		)
Home selling expenses	2,990			2,460			6,101			4,597
General and administrative	19,989			16,543			37,921			30,335
Transaction costs	2,437			20,979			4,823			23,700
Depreciation and amortization	62,721			49,670			125,487			98,082
Extinguishment of debt	293			—			759			—
Interest expense	33,145			29,215			65,251			56,296
Other income, net (4)	(875		)	—			(1,627		)	—
Current tax (benefit) / expense	(7		)	56			171			284
Deferred tax benefit	(364		)	—			(664		)	—
Preferred return to preferred OP units	1,196			1,263			2,370			2,536
Amounts attributable to noncontrolling interests	1,315			(695		)	2,403			(419		)
Preferred stock distributions	2,099			2,197			4,278			4,551
NOI(1) / Gross Profit	$	131,252		$	108,466		$	269,165		$	210,264

	Three Months Ended June 30,						Six Months Ended   June 30,
	2017			2016			2017			2016
Real Property NOI (1)	$	112,889		$	92,781		$	235,634		$	181,230
Rental Program NOI (1)	23,743			21,959			46,699			43,009
Home Sales NOI(1) / Gross Profit	8,837			7,355			15,217			13,908
Ancillary NOI(1) / Gross Profit	1,792			1,784			3,343			2,748
Site rent from Rental Program (included in Real Property NOI) (1)(7)	(16,009		)	(15,413		)	(31,728		)	(30,631		)
NOI(1) / Gross profit	$	131,252		$	108,466		$	269,165		$	210,264

2nd Quarter 2017 Supplemental Information     10          Sun Communities, Inc.

Non-GAAP and Other Financial Measures

2nd Quarter 2017 Supplemental Information     11          Sun Communities, Inc.

Financial Highlights                                                

(amounts in thousands, except per share data)

	Quarter Ended
	6/30/2017		3/31/2017		12/31/2016			9/30/2016		6/30/2016
OPERATING INFORMATION
Total revenues	$	237,899	$	234,400	$	218,634		$	249,701	$	190,799
Net income / (loss)	$	16,974	$	25,545	$	1,501		$	23,230	$	(5,038	)
Net income / (loss) attributable to common stockholders	$	12,364	$	21,104	$	(1,600	)	$	18,897	$	(7,803	)
Earnings / (loss) per share basic	$	0.16	$	0.29	$	(0.02	)	$	0.27	$	(0.12	)
Earnings / (loss) per share diluted	$	0.16	$	0.29	$	(0.02	)	$	0.27	$	(0.12	)
Recurring EBITDA (1)	$	114,324	$	122,395	$	105,850		$	123,276	$	94,882
FFO attributable to Sun Communities, Inc. common stockholders and dilutive convertible securities(1) (6)	$	73,202	$	83,391	$	57,572		$	78,023	$	37,473
FFO attributable to Sun Communities, Inc. common stockholders and dilutive convertible securities excluding certain items(1)(6)	$	76,194	$	85,621	$	69,192		$	83,181	$	58,452
FFO attributable to Sun Communities, Inc. common stockholders and dilutive convertible securities (1) (6) per share - fully diluted	$	0.92	$	1.07	$	0.75		$	1.06	$	0.54
FFO attributable to Sun Communities, Inc. common stockholders and dilutive convertible securities (1) (6) per share excluding certain items - fully diluted	$	0.96	$	1.10	$	0.91		$	1.13	$	0.85
BALANCE SHEETS
Total assets	$	6,178,713	$	5,902,447	$	5,870,776		$	5,904,706	$	5,823,191
Total debt	$	3,018,653	$	3,140,547	$	3,110,042		$	3,102,993	$	3,340,329
Total liabilities	$	3,373,695	$	3,478,132	$	3,441,605		$	3,429,743	$	3,645,744

2nd Quarter 2017 Supplemental Information     12          Sun Communities, Inc.

Debt Analysis                                                    

(amounts in thousands)

	Quarter Ended
	6/30/2017		3/31/2017		12/31/2016		9/30/2016		6/30/2016
DEBT OUTSTANDING
Mortgage loans payable	$	2,832,819	$	2,774,645	$	2,819,567	$	2,854,831	$	2,792,021
Secured borrowings (3)	139,496		141,671		144,477		144,522		144,684
Preferred OP units - mandatorily redeemable	45,903		45,903		45,903		45,903		45,903
Lines of credit (8)	435		178,328		100,095		57,737		357,721
Total debt	$	3,018,653	$	3,140,547	$	3,110,042	$	3,102,993	$	3,340,329
% FIXED/FLOATING
Fixed	94.9%		89.4%		91.8%		93.1%		84.5%
Floating	5.1%		10.6%		8.2%		6.9%		15.5%
Total	100.0%		100.0%		100.0%		100.0%		100.0%
WEIGHTED AVERAGE INTEREST RATES
Mortgage loans payable	4.26%		4.26%		4.24%		4.30%		4.38%
Preferred OP units - mandatorily redeemable	6.87%		6.87%		6.87%		6.87%		6.87%
Lines of credit	—%		2.52%		2.14%		1.93%		1.89%
Average before Secured borrowings	4.30%		4.19%		4.21%		4.29%		4.13%
Secured borrowings (3)	9.99%		10.01%		10.03%		10.06%		10.09%
Total average	4.56%		4.45%		4.48%		4.56%		4.39%
DEBT RATIOS
Net Debt / Recurring EBITDA(1) (TTM)	6.0		7.0		7.5		7.7		9.1
Net Debt / Enterprise Value	27.2%		32.8%		33.8%		32.8%		36.6%
Net Debt + Preferred Stock / Enterprise Value	28.4%		34.2%		35.2%		34.2%		38.0%
Net Debt / Gross Assets	38.0%		44.8%		45.0%		44.1%		49.0%
COVERAGE RATIOS
Recurring EBITDA(1) (TTM) / Interest	3.4		3.3		3.2		3.1		3.1
Recurring EBITDA(1) (TTM) / Interest + Pref. Distributions + Pref. Stock Distribution	3.1		3.0		2.9		2.9		2.8

MATURITIES/PRINCIPAL AMORTIZATION NEXT FIVE YEARS	2017			2018			2019			2020			2021
Mortgage loans payable:
Maturities	$	—		$	26,186		$	64,314		$	58,078		$	270,680
Weighted average rate of maturities	—		%	6.13		%	6.24		%	5.92		%	5.53		%
Principal amortization	26,533			55,143			55,937			56,558			55,503
Secured borrowings (3)	2,763			5,923			6,440			7,028			7,550
Preferred OP units - mandatorily redeemable	3,670			7,570			—			—			—
Lines of credit	—			435			—			—			—
Total	$	32,966		$	95,257		$	126,691		$	121,664		$	333,733

2nd Quarter 2017 Supplemental Information     13          Sun Communities, Inc.

Statements of Operations – Same Community

(amounts in thousands except for Other Information)

	Three Months Ended June 30,								Six Months Ended June 30,
	2017		2016		Change		% Change		2017		2016		Change		% Change
REVENUES:
Income from real property	$	131,008	$	123,399	$	7,609	6.2	%	$	259,764	$	245,842	$	13,922	5.7	%
PROPERTY OPERATING EXPENSES:
Payroll and benefits	11,615		11,143		472		4.2	%	21,710		20,811		899		4.3	%
Legal, taxes & insurance	1,564		1,418		146		10.3	%	2,748		2,717		31		1.1	%
Utilities	7,192		6,577		615		9.4	%	13,944		13,261		683		5.2	%
Supplies and repair	5,560		5,130		430		8.4	%	9,010		8,612		398		4.6	%
Other	3,296		3,180		116		3.7	%	6,472		6,457		15		0.2	%
Real estate taxes	9,767		9,224		543		5.9	%	19,473		18,795		678		3.6	%
Property operating expenses	38,994		36,672		2,322		6.3	%	73,357		70,653		2,704		3.8	%
NET OPERATING INCOME (NOI)(1)	$	92,014	$	86,727	$	5,287	6.1	%	$	186,407	$	175,189	$	11,218	6.4	%

	As of June 30,
	2017			2016				Change			% Change
OTHER INFORMATION
Number of properties	231			231				—
Overall occupancy (9)	97.2		%	95.6		%	(10)	1.6		%
Sites available for development	6,193			6,919				(726		)	(10.6	)%
Monthly base rent per site - MH	$	510		$	493			$	17		3.4	%	(12)
Monthly base rent per site - RV (11)	$	448		$	432			$	16		3.6	%	(12)
Monthly base rent per site - Total	$	502		$	486			$	16		3.4	%	(12)

2nd Quarter 2017 Supplemental Information     14          Sun Communities, Inc.

Rental Program Summary     

(amounts in thousands except for *)

	Three Months Ended June 30,									Six Months Ended June 30,
	2017		2016		Change			% Change		2017		2016		Change			% Change
REVENUES:
Rental home revenue	$	12,678	$	11,957	$	721		6.0	%	$	25,017	$	23,665	$	1,352		5.7	%
Site rent included in Income from real property	16,009		15,413		596			3.9	%	31,728		30,631		1,097			3.6	%
Rental program revenue	28,687		27,370		1,317			4.8	%	56,745		54,296		2,449			4.5	%
EXPENSES:
Commissions	401		384		17			4.4	%	1,011		1,159		(148		)	(12.8	)%
Repairs and refurbishment	2,363		3,273		(910		)	(27.8	)%	4,644		5,939		(1,295		)	(21.8	)%
Taxes and insurance	1,506		1,167		339			29.1	%	2,943		2,732		211			7.7	%
Marketing and other	674		587		87			14.8	%	1,448		1,457		(9		)	(0.6	)%
Rental program operating and maintenance	4,944		5,411		(467		)	(8.6	)%	10,046		11,287		(1,241		)	(11.0	)%
NET OPERATING INCOME (NOI) (1)	$	23,743	$	21,959	$	1,784		8.1	%	$	46,699	$	43,009	$	3,690		8.6	%

Occupied rental home information as of June 30, 2017 and 2016:
Number of occupied rentals, end of period*	11,083		10,997		86			0.8	%
Investment in occupied rental homes, end of period	$	479,503	$	453,869	$	25,634		5.7	%
Number of sold rental homes (YTD)*	542		572		(30		)	(5.2	)%
Weighted average monthly rental rate, end of period*	$	897	$	868	$	29		3.3	%

2nd Quarter 2017 Supplemental Information     15          Sun Communities, Inc.

Home Sales Summary     

(amounts in thousands except for *)

	Three Months Ended June 30,											Six Months Ended June 30,
	2017			2016			Change			% Change		2017			2016			Change			% Change
New home sales	$	7,546		$	5,612		$	1,934		34.5	%	$	14,429		$	11,081		$	3,348		30.2	%
Pre-owned home sales	23,313			20,427			2,886			14.1	%	43,693			39,695			3,998			10.1	%
Revenue from home sales	30,859			26,039			4,820			18.5	%	58,122			50,776			7,346			14.5	%
New home cost of sales	6,497			4,773			1,724			36.1	%	12,345			9,617			2,728			28.4	%
Pre-owned home cost of sales	15,525			13,911			1,614			11.6	%	30,560			27,251			3,309			12.1	%
Cost of home sales	22,022			18,684			3,338			17.9	%	42,905			36,868			6,037			16.4	%
NOI / Gross Profit (1)	$	8,837		$	7,355		$	1,482		20.2	%	$	15,217		$	13,908		$	1,309		9.4	%
Gross profit – new homes	$	1,049		$	839		$	210		25.0	%	$	2,084		$	1,464		$	620		42.4	%
Gross margin % – new homes	13.9		%	15.0		%	(1.1		)%			14.4		%	13.2		%	1.2		%
Average selling price – new homes*	$	93,161		$	95,119		$	(1,958	)	(2.1	)%	$	91,905		$	88,648		$	3,257		3.7	%
Gross profit – pre-owned homes	$	7,788		$	6,516		$	1,272		19.5	%	$	13,133		$	12,444		$	689		5.5	%
Gross margin % – pre-owned homes	33.4		%	31.9		%	1.5		%			30.1		%	31.3		%	(1.2		)%
Average selling price – pre-owned homes*	$	32,379		$	29,562		$	2,817		9.5	%	$	29,723		$	28,558		$	1,165		4.1	%
Home sales volume:
New home sales*	81			59			22			37.3	%	157			125			32			25.6	%
Pre-owned home sales*	720			691			29			4.2	%	1,470			1,390			80			5.8	%
Total homes sold*	801			750			51			6.8	%	1,627			1,515			112			7.4	%

2nd Quarter 2017 Supplemental Information     16          Sun Communities, Inc.

Acquisitions Summary - Properties Acquired in 2017 and 2016

(amounts in thousands except for statistical data)

	Three Months Ended   June 30, 2017		Six Months Ended   June 30, 2017
REVENUES:
Income from real property	$	42,455	$	89,956
PROPERTY AND OPERATING EXPENSES:
Payroll and benefits	6,640		11,466
Legal, taxes & insurance	326		670
Utilities	6,649		13,137
Supplies and repair	1,752		3,001
Other	2,854		5,659
Real estate taxes	3,359		6,796
Property operating expenses	21,580		40,729
NET OPERATING INCOME (NOI) (1)	$	20,875	$	49,227
			As of June 30, 2017
Other information:
Number of properties			113
Occupied sites (13)			21,728
Developed sites(13)			22,395
Occupancy % (13)			97.0		%
Transient sites			7,358
Monthly base rent per site - MH			$	620
Monthly base rent per site - RV (11)			$	404
Monthly base rent per site - Total (11)			$	507
Ancillary revenues, net (in thousands)			$	1,217
Home sales:
Gross profit from home sales (in thousands)			$	1,958
New homes sales			44
Pre-owned homes sales			172
Occupied rental home information:
Rental program NOI (1) (in thousands)			$	297
Number of occupied rentals, end of period			352
Investment in occupied rental homes (in thousands)			$	8,163
Weighted average monthly rental rate			$	991

2nd Quarter 2017 Supplemental Information     17          Sun Communities, Inc.

Property Summary
(includes MH and Annual/Seasonal RV’s)
COMMUNITIES	6/30/2017		3/31/2017		12/31/2016		9/30/2016		6/30/2016
FLORIDA
Communities	121		121		121		121		121
Developed sites (13)	36,661		36,533		36,326		36,050		36,119
Occupied (13)	35,479		35,257		35,021		34,745		34,720
Occupancy % (13)	96.8	%	96.5	%	96.4	%	96.4	%	96.1	%
Sites for development	1,368		1,359		1,465		1,259		1,259
MICHIGAN
Communities	68		67		67		67		66
Developed sites (13)	25,496		25,024		24,512		24,388		24,387
Occupied (13)	23,924		23,443		23,248		23,218		23,198
Occupancy % (13)	93.8	%	93.7	%	94.8	%	95.2	%	95.1	%
Sites for development	1,752		1,798		2,589		2,628		2,248
TEXAS
Communities	21		21		21		21		21
Developed sites (13)	6,312		6,292		6,186		6,088		6,071
Occupied (13)	6,021		5,943		5,862		5,774		5,771
Occupancy % (13)	95.4	%	94.5	%	94.8	%	94.8	%	95.1	%
Sites for development	1,345		1,387		1,474		1,455		1,347
CALIFORNIA
Communities	23		23		22		22		22
Developed sites (13)	4,894		4,865		4,862		4,863		4,864
Occupied (13)	4,834		4,804		4,793		4,792		4,796
Occupancy % (13)	98.8	%	98.7	%	98.6	%	98.5	%	98.6	%
Sites for development	367		411		332		332		332
ARIZONA
Communities	11		11		11		11		11
Developed sites (13)	3,589		3,582		3,565		3,567		3,532
Occupied (13)	3,383		3,370		3,338		3,305		3,281
Occupancy % (13)	94.3	%	94.1	%	93.6	%	92.7	%	92.9	%
Sites for development	269		269		358		358		358
ONTARIO, CANADA
Communities	15		15		15		15		15
Developed sites (13)	3,564		3,451		3,368		3,453		3,375
Occupied (13)	3,564		3,451		3,368		3,453		3,375
Occupancy % (13)	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%
Sites for development	1,628		1,628		1,599		2,029		2,029
INDIANA
Communities	11		11		11		11		11
Developed sites (13)	2,900		2,900		2,900		2,900		2,900
Occupied (13)	2,758		2,741		2,724		2,712		2,700
Occupancy % (13)	95.1	%	94.5	%	93.9	%	93.5	%	93.1	%
Sites for development	330		330		316		316		316

2nd Quarter 2017 Supplemental Information     18          Sun Communities, Inc.

Property Summary
(includes MH and Annual/Seasonal RV’s)
COMMUNITIES	6/30/2017		3/31/2017		12/31/2016		9/30/2016		6/30/2016
OHIO
Communities	9		9		9		9		9
Developed sites (13)	2,735		2,719		2,715		2,719		2,718
Occupied (13)	2,643		2,623		2,595		2,602		2,616
Occupancy % (13)	96.6	%	96.5	%	95.6	%	95.7	%	96.2	%
Sites for development	75		75		—		—		—
COLORADO
Communities	8		8		8		7		7
Developed sites (13)	2,335		2,335		2,335		2,335		2,335
Occupied (13)	2,326		2,329		2,325		2,323		2,320
Occupancy % (13)	99.6	%	99.7	%	99.6	%	99.5	%	99.4	%
Sites for development	656		656		656		304		304
OTHER STATES
Communities	57		56		56		55		54
Developed sites (13)	14,891		14,567		14,313		14,415		14,337
Occupied (13)	14,439		14,130		13,919		13,991		13,912
Occupancy % (13)	97.0	%	97.0	%	97.3	%	97.1	%	97.0	%
Sites for development	2,582		1,977		1,827		1,823		1,728
TOTAL - PORTFOLIO
Communities	344		342		341		339		337
Developed sites (13)	103,377		102,268		101,082		100,778		100,638
Occupied (13)	99,371		98,091		97,193		96,915		96,689
Occupancy % (13)	96.1	%	95.9	%	96.2	%	96.2	%	96.1	%
Sites for development	10,372		9,890		10,616		10,504		9,921
% Communities age restricted	32.8	%	33.0	%	33.1	%	33.3	%	33.5	%
TRANSIENT RV PORTFOLIO SUMMARY
Location
Florida	6,244		6,467		6,497		7,232		6,990
Ontario, Canada	1,314		1,451		1,500		1,485		1,657
Texas	1,403		1,412		1,407		1,446		1,455
Arizona	1,025		1,032		1,049		1,047		1,055
New Jersey	1,028		1,059		1,042		1,047		1,084
New York	630		588		830		484		483
Maine	533		543		555		556		571
California	808		840		513		478		518
Indiana	520		520		502		501		501
Michigan	260		210		204		203		126
Ohio	169		194		198		194		195
Other locations	2,253		1,966		1,997		1,801		1,864
Total transient RV sites	16,187		16,282		16,294		16,474		16,499

2nd Quarter 2017 Supplemental Information     19          Sun Communities, Inc.

Capital Improvements, Development, and Acquisitions     

(amounts in thousands except for *)

	Recurring
	Capital			Recurring
	Expenditures			Capital			Lot					Expansion &			Revenue
		Average/Site*			Expenditures (14)			Modifications(15)		Acquisitions (16)			Development (17)			Producing (18)
YTD 2017		$	94		$	8,410		$	10,703	$	69,402		$	32,541		$	784
2016		$	211		$	17,613		$	19,040	$	1,822,564		$	47,958		$	2,631
2015		$	230		$	20,344		$	13,961	$	1,214,482		$	28,660		$	4,497

2nd Quarter 2017 Supplemental Information     20          Sun Communities, Inc.

Operating Statistics for Manufactured Homes and Annual/Seasonal RV’s    

	Resident		Net Leased		New Home		Pre-owned		Brokered
LOCATIONS	Move-outs		Sites (19)		Sales		Home Sales		Re-sales
Florida		540		458		79		227		681
Michigan		265		386		16		651		60
Texas		123		159		15		183		17
California		12		11		2		10		8
Arizona		32		45		16		14		100
Ontario, Canada		88		196		8		20		79
Indiana		22		34		1		114		12
Ohio		55		48		—		57		3
Colorado		4		1		3		65		27
Other locations		373		101		17		129		79
Six Months Ended June 30, 2017		1,514		1,439		157		1,470		1,066

	Resident		Net Leased		New Home		Pre-owned		Brokered
TOTAL FOR YEAR ENDED	Move-outs		Sites (19)		Sales		Home Sales		Re-sales
2016		1,722		1,686		329		2,843		1,655
2015		1,344		1,905		273		2,210		1,244

	Resident			Resident
PERCENTAGE TRENDS	Move-outs			Re-sales
2017 (TTM)		2.1	%		6.3	%
2016		2.0	%		6.1	%
2015		2.0	%		5.9	%

2nd Quarter 2017 Supplemental Information     21          Sun Communities, Inc.

Footnotes and Definitions                        

(1) Investors in and analysts following the real estate industry utilize funds from operations (FFO), net operating income (NOI), and recurring earnings before interest, tax, depreciation and amortization (Recurring EBITDA) as supplemental performance measures. We believe FFO, NOI, and Recurring EBITDA are appropriate measures given their wide use by and relevance to investors and analysts. 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. 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. Recurring EBITDA, a metric calculated as EBITDA exclusive of certain nonrecurring items, provides a further tool to evaluate ability to incur and service debt and to fund dividends and other cash needs. Additionally, FFO, NOI, and Recurring EBITDA are commonly used in various ratios, pricing multiples/yields and returns and valuation calculations used to measure financial position, performance and value.

FFO is defined by the National Association of Real Estate Investment Trusts (NAREIT) as net income (loss) computed in accordance with generally accepted accounting principles (GAAP), excluding gains (or losses) from sales of depreciable operating property, plus real estate-related depreciation and amortization, 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 the Company's operating performance. Management generally considers FFO to be a useful measure for reviewing comparative operating and financial performance because, 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 net income (loss). Management believes that 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. FFO is computed in accordance with the Company's interpretation of standards established by NAREIT, which may not be comparable to FFO reported by other REITs that do not define the term in accordance with the current NAREIT definition or that interpret the current NAREIT definition differently than the Company. The Company also uses FFO excluding certain items, which excludes certain gain and loss items that management considers unrelated to the operational and financial performance of our core business. We believe that this provides investors with another financial measure of our operating performance that is more comparable when evaluating period over period results.

Because FFO excludes significant economic components of net income (loss) including depreciation and amortization, FFO should be used as an adjunct to net income (loss) and not as an alternative to net income (loss). The principal limitation of FFO is that it does not represent cash flow from operations as defined by GAAP and is a supplemental measure of performance that does not replace net income (loss) as a measure of performance or net cash provided by operating activities as a measure of liquidity. In addition, 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 only provides investors with an additional performance measure that, when combined with measures computed in accordance with GAAP such as net income (loss), cash flow from operating activities, investing activities and financing activities, provide investors with an indication of our ability to service debt and to fund acquisitions and other expenditures. Other REITs may use different methods for calculating FFO, accordingly, our FFO may not be comparable to other REITs.

NOI is derived from revenues minus property operating expenses and real estate taxes. NOI does not represent cash generated from operating activities in accordance with GAAP and should not be considered to be an alternative to net income (loss) (determined in accordance with GAAP) as an indication of the Company's financial performance or to be an alternative to cash flow from operating activities (determined in accordance with GAAP) as a measure of the Company's liquidity; nor is it indicative of funds available for the Company's cash needs, including its ability to make cash distributions. The Company believes that net income (loss) is the most directly comparable GAAP measurement to NOI. Because of the inclusion of items such as interest, depreciation, and amortization, the use of 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. The Company believes that NOI is helpful to investors as a 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. The Company uses NOI as a key management tool 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

2nd Quarter 2017 Supplemental Information     22          Sun Communities, Inc.

costs, therefore, NOI is a measure of the operating performance of the properties of the Company rather than of the Company overall.

EBITDA is defined as NOI plus other income, plus (minus) equity earnings (loss) from affiliates, minus general and administrative expenses. EBITDA includes EBITDA from discontinued operations. The Company believes that net income (loss) is the most directly comparable GAAP measurement to EBITDA.

(2) The consideration amounts presented with respect to acquired communities represent the economic transaction and do not contemplate the fair value purchase accounting required by GAAP.

(3) This is a transferred asset transaction which has been classified as collateralized receivables and the cash received from this transaction has been classified as a secured borrowing. The interest income and interest expense accrue at the same rate/amount.

(4) Other income, net for the three months ended June 30, 2017, is comprised of a foreign currency translation gain of $2.2 million partially offset by contingent liability re-measurement of $0.8 million, hurricane related expenses of $0.3 million and other expenses of $0.2 million. For the six months ended June 30, 2017, Other income, net is comprised primarily of a foreign currency translation gain of $3.0 million, partially offset by contingent liability re-measurement of $1.0 million and hurricane related expenses of $0.4 million.

(5) These costs represent the first year expenses incurred to bring acquired properties up to the Company's operating standards, including items such as tree trimming and painting costs that do not meet the Company's capitalization policy.

(6) The effect of certain anti-dilutive convertible securities is excluded from these items.

(7) The renter's monthly payment includes the site rent and an amount attributable to the leasing of the home. The site rent is reflected in Real Property NOI. For purposes of management analysis, the site rent is included in the Rental Program revenue to evaluate the incremental revenue gains associated with implementation of the Rental Program, and to assess the overall growth and performance of the Rental Program and financial impact on our operations.

(8) Lines of credit balance of $0.4 million at June 30, 2017 represents the Company's MH floor plan facility. There were no borrowings outstanding on the revolving loan or term loan as of June 30, 2017. As of June 30, 2017, the effective interest rate on the MH floor plan facility was 7.0 percent, however, the Company pays no interest if the floor plan balance is repaid within 60 days.

(9) Includes manufactured housing (MH) and annual/seasonal recreational vehicle (RV) sites, and excludes transient RV sites and recently completed but vacant expansion sites.

(10) Occupancy reflects current year gains from expansion sites and the conversion of transient RV guests to annual/seasonal RV contracts as vacant in 2016.

(11) Monthly base rent per site pertains to annual/seasonal RV sites and excludes transient RV sites.

(12) Calculated using actual results without rounding.

(13) Includes MH and annual/seasonal RV sites, and excludes transient RV sites.

(14) Includes capital expenditures necessary to maintain asset quality, including purchasing and replacing assets used to operate the community. These capital expenditures include items such as: major road, driveway, and pool improvements; clubhouse renovations; adding or replacing street lights; playground equipment; signage; maintenance facilities; manager housing and property vehicles. The minimum capitalized amount is five hundred dollars.

(15) Includes capital expenditures which improve the asset quality of the community. These costs are incurred when an existing older home moves out, and the site is prepared for a new home, more often than not, a multi-sectional home. These activities which are mandated by strict manufacturer’s installation requirements and state building code include items such as new foundations, driveways, and utility upgrades.

2nd Quarter 2017 Supplemental Information     23          Sun Communities, Inc.

(16) Acquisitions represent the purchase price of existing operating communities and land parcels to develop expansions or new communities. Acquisitions for the six months ended June 30, 2017 also include $29.5 million of capital improvements identified during due diligence that are necessary to bring the community up to the Company’s 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; and new signage including main signs and internal road signs. These are considered acquisition costs and although identified during due diligence, they sometimes require 24 to 36 months after closing to complete.

(17) Expansion and development costs consist primarily of construction costs and costs necessary to complete home site improvements.

(18) Capital costs related to revenue generating activities, consist primarily of garages, sheds, and sub-metering of water, sewer and electricity. Revenue generating attractions at our RV resorts are also included here and, occasionally, a special capital project requested by residents and accompanied by an extra rental increase will be classified as revenue producing.

(19) Net leased sites do not include occupied sites acquired in that year.

Certain financial information has been revised to reflect reclassifications in prior periods to conform to current period presentation.

2nd Quarter 2017 Supplemental Information     24          Sun Communities, Inc.