SUI 10-K & 10-Q changes, risk factors and insider trading

The following discussion and analysis of the consolidated financial condition and results of operations should be read in conjunction with the Consolidated Financial Statements and accompanying footnotes thereto included in this Annual Report on Form 10-K. In addition to the results presented in accordance with GAAP below, we have provided net operating income ("NOI") and FFO information as supplemental performance measures. Refer to Non-GAAP Financial Measures in this Item 7 for additional information.

We are a fully integrated REIT. As of December 31, 2024,2025, we owned and operated, directly or indirectly, or had an interest in, a portfolio of 645513 developed properties located in the U.S., Canada, and the UK including 288294 MH communities, 166 RV communities, 138 marinas and 53 UK communities.

We have been in the business of operating, acquiring, operating, developing and expanding MH and RV communities since 1975, marinas since 2020, and communities in the UKUnited Kingdom since 2022. We lease individual parcels of land, or sites, with utility access for the placement of manufactured homes and RVs to our MH, RV, and UK customers. Our MH communities are designed to offer affordable housing to individuals and families, while also providing certain amenities. In the U.S., we are also market,engaged sell,in the marketing, selling and leaseleasing of new and pre-owned homes to current and future residents in our MH communities. The rental program operations within our MH communities support and enhance our occupancy levels, property performance,performance and cash flows. Our RV communities are designed to offer affordable vacation opportunities to individuals and families complemented by a diverse selection of high-quality amenities. The majority of our marinas are concentrated in coastal regions. Our marinas offer wet slip and dry storage space leases, end-to-end service (such as routine maintenance, repair, and winterization), fuel sales, and other high-end amenities. These services and amenities offer convenience and resort-quality experiences to our members and guests. In the UK,United Kingdom, our Park HolidaysUK communities are referred to as "holiday parks" and are located predominantly at irreplaceable seaside destinations in the south of England. We provide holiday home sales and associated site license activities to holiday homeowners in our communities.

Leadership ChangeTransition

•Total revenues from continuing operations for 20242025 were $3.2$2.3 billion, consistent with 20232024 total revenues.

•Net income attributable to SUI common shareholders was $89.0$1.4 million,billion, as compared to a net lossincome attributable to SUI common shareholders of $213.3$89.0 million in the prior year, driven primarily by Samea Propertytotal NOI generation and gains on dispositionsgain of assets.$1.5 billion from the Safe Harbor Sale in 2025.

•Achieved Realreal property Same Property NOI growth of 6.7%8.9% for MH, 5.4% for MarinaMH and 9.0%3.5% for the UK over 2023.2024. For the RV segment, we experienced a decline in Same Property NOI growth of 2.8%,1.4%, driven by lower than anticipated real property - transient revenues and an increase in supplies and repair expenses and other expenses.revenues.

Occupancy in our MH and annual RV properties, as well as our ability to increase rental rates, directly affect revenues. Our revenue streams are predominantly derived from customers renting our sites on a long-term basis. Our Same Property communities continue to achieve revenue and occupancy increases which drive continued NOI growth. Our Same Property marinas and UK communities achieved revenue increases which contributed to our NOI growth.

Our MH and RV properties are largely concentrated in the U.S. in Florida, Michigan, Texas, and California, which collectively contain 63.9%64.7% of our total MH and RV sites. We have expanded our market share in multiple states through acquisitions and increased our property holdings in high-growth areas of the U.S. including retirement and vacation destinations. The age demographic of RV communities is attractive, as the population of retirement age adults in the U.S. is growing. RV communities have become a trending vacation opportunity not only for the retiree population, but as an affordable vacation alternative for families and millennials.

In addition to the results reported in accordance with GAAP in our "Results of Operations" below, we have provided information regarding net operating income ("NOI") and funds from operations ("FFO") as supplemental performance measures. We believe NOI and FFO are appropriate measures given their wide use by and relevance to investors and analysts. Investors and analysts following the real estate industry.industry use these supplemental non-GAAP measures to assess REITs. 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. FFO, reflecting the assumption that real estate values rise or fall with market conditions, principally adjusts net income for the effects of GAAP depreciation / amortization of real estate assets.assets and gains or losses on real estate dispositions. In addition, NOINOI, and FFO are commonly used in various ratios, pricing multiples / yields and returnsreturns, and valuation calculations used to measure financial position, performanceperformance, and value.

Total Portfolio NOI - NOI is derived from property operating revenues minus property operating expenses and real estate taxes. NOI is a non-GAAP financial measure that we believe is helpful to investors as a supplemental 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. We use NOI as a key measure 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 expenseexpense, and non-property specific expenses such as general and administrative expenses, all of which are significant costs. Therefore, NOI is a measure of the operating performance of our properties rather than of the Company overall. We believe that NOI provides enhanced comparability for investor evaluation of properties'property performance and growth over time.

We believe that GAAP net income (loss) is the most directly comparable measure to NOI. NOI should not be considered to be an alternative to GAAP net income (loss) as an indication of our financial performance or GAAP net cash flowprovided fromby operating activities as a measure of our liquidity; nor is it indicative of funds available for our cash needs, including our ability to make cash distributions. Because of the inclusion of items such as interest, depreciationdepreciation, and amortization, the use of GAAP 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.

Same Property NOI - This is a key management tool used when evaluating the performance and growth of our Same Property portfolio. We define same properties as those we have owned and operated continuously since January 1, 2023.2024. Same properties exclude ground-up development properties, acquired properties, properties classified as discontinued operations, and properties sold after December 31, 2022.2023. The Same Property data may change from time-to-time depending on acquisitions, dispositions, management discretion, significant transactionstransactions, or unique situations. Same Property NOI does not include the revenues and expenses related to home sales,sales and service, retail, dining and entertainmentancillary activities at the properties. We believe that Same Property NOI is helpful to investors as a supplemental comparative performance measure of the income generated from the Same Property portfolio from one period to the next. For the UK segment, we present Same Property NOI growth rate information on a constant currency basis to provide a framework for assessing how our underlying properties performed after excluding the effects of changes in exchange rates. We believe that the presentation of UK Same Property NOI on a constant currency basis helps to improve the ability to understand our performance because it excludes the effects of foreign currency volatility which are not indicative of our core operating results in the region.

FFO is defined by the National Association of Real Estate Investment Trusts ("Nareit") as GAAP net income (loss), excluding gains (or losses) from sales of certain real estate assets, plus real estate related depreciation and amortization, impairments of certain real estate assets and investments, and after adjustments for unconsolidatednonconsolidated partnerships and joint ventures. FFO is a non-GAAP financial measure that management believes is a useful supplemental measure of our operating performance. By excluding gains and losses related to sales of previously depreciated operating real estate assets, real estate related to impairment,impairment and 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 GAAP net income (loss). Management believes 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.

Core FFO - In addition,addition to FFO, we use FFO excluding certain gain and loss items that management considers unrelated to the operational and financial performance of our core business ("Core FFO"). to evaluate our performance. These adjustments include acquisition and other transaction costs, gains and losses from the early extinguishment of debt, costs related to catastrophic weather events, net of insurance recoveries, gains and losses on foreign currency exchanges, and other miscellaneous non-comparable items.

We believe that FFO and Core FFO provide enhanced comparability for investor evaluations of period-over-period results. We believe that GAAP net income (loss) is the most directly comparable measure to FFO. The principal limitation of FFO is that it does not replace GAAP net income (loss) as a financial performance measure or GAAP cash flow from operating activities as a measure of our liquidity. Because FFO excludes significant economic components of GAAP net income (loss) including depreciation and amortization, FFO should be used as a supplement to GAAP net income (loss) and not as an alternative to it. Furthermore, 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 is calculated in accordance with our interpretation of standards established by Nareit, which may not be comparable to FFO reported by other REITs that interpret the Nareit definition differently. Certain financial information has been revised to reflect reclassifications in prior periods to conform to current period presentation.

The following tables reconcile the Net Incomeincome / (Lossloss) attributable to Sun Communities, Inc.SUI common shareholders to NOI and summarize our consolidated financial results for the years ended December 31, 2024, 2023, and 2022 (in millions):

The RV, Marina,RV and UK segments are seasonal and the results of operations in any one period may not be indicative of results in future periods.

In the RV segment, certain properties maintain higher occupancy during the summer months, while other properties maintain higher occupancy during the winter months. Based on the location of our properties with transient RV sites, our portfolio generally produces higher revenues between April and September than between October and March. In the UK segment, vacation rental sites generally produce higher revenues between March and October. The following table presents the seasonality of real property-transient revenue for the years ended December 31, 2024, 2023, and 2022:

The following tables reflect certain financial and other information for our real estate operations by segment as of and for the years ended December 31, 2024 and 2023 (in millions, except for statistical information):

(a1) MH annual sites included 11,21412,518 and 10,23710,923 rental homes in our Rental Program at December 31, 20242025 and 2023,2024, respectively. Our investment in occupied rental homes at December 31, 20242025 was $783.0$921.3 million, an increase of 12.3%17.7% from $697.1$783.0 million at December 31, 2023.2024.

For the year ended December 31, 2024,2025, the $56.0$43.5 million, or 4.5%4.3%, increase in Real Property NOI as compared to the same period in 2023,2024, consists of an increase of $39.9$56.0 million from Same Property MH, an increase of $13.6 million from Same Property Marina,and an increase of $6.2$2.7 million from Same Property UK, andpartially offset by an increaseNOI decrease of $4.3$11.1 million, net from otherproperties recently acquired or developed properties, partially offset by a decreaseoutside of $8.0 million fromthe Same Property RV.population due to portfolio disposition activity that took place in 2024, primarily driven by the disposition of 10 MH properties for total gross sales proceeds of $349.1 million.

The following tables reflect certain financial and other information for our Same Property MH, RV,MH and MarinaRV portfolios as of and for the years ended December 31, 20242025 and 20232024 (in millions, except for statistical information).:

In addition to the other information set forth in this report, you should carefully consider the risk factors described in Part 1, Item 1A., "Risk Factors," in our 2025 Annual Report, and in Item 8.01 of our Current Report on Form 8-K filed on May 21, 2026, which could materially affect our business, financial condition, or future results. ThereWe have beenupdated noour materialrisk changes to the disclosure on these matters asfactors set forth in such report.reports with the risk factor described below:

We are a fully integrated REIT. As of MarchJune 31,30, 2026, we owned and operated, directly or indirectly, or hadheld an interest in, a portfolio of 515455 developed properties located in the U.S., Canada,U.S. and the United KingdomCanada including 295 MH communities,communities 166and 160 RV communities,communities. andAt that date, we also owned, operated, or held an interest in a portfolio of 54 UK communities.properties, which were classified within discontinued operations as of June 30, 2026.

We have been in the business of operating, acquiring, developing and expanding MH and RV communities since 1975, and communities in the United Kingdom since 2022.1975. We lease individual parcels of land, or sites, with utility access for the placement of manufactured homes and RVs to our MH, RV,MH and UKRV customers. Our MH communities are designed to offer affordable housing to individuals and families, while also providing certain amenities. In the U.S., we are also engaged in the marketing, selling and leasing of new and pre-owned homes to current and future residents in our MH communities. The rental program operations within our MH communities support and enhance our occupancy levels, property performance and cash flows. Our RV communities are designed to offer affordable vacation opportunities to individuals and families complemented by a diverse selection of high-quality amenities. In the United Kingdom, our UK communities are referred to as "holiday parks" and are located predominantly at irreplaceable seaside destinations in the south of England. We provide holiday home sales and associated site license activities to holiday homeowners in our communities.

Over the past several years, we have shifted our strategy toward optimizing the value of our core business through achieving strong rental rate growth and operating efficiencies, while also pursuing select new acquisition opportunities that meet our capital investment criteria. In 2025, the Safe Harbor Sale advanced our strategy of focusing on our core business and enhanced our leverage profile and financial flexibility. Our current objectives include continuing to streamline our operations with an emphasis on our reliable real property income, while also selectively pursuing MH and RV acquisition opportunities. We believe we are positioned for organic growth in 2026 with expected rental rate increases, occupancy gains, and expense management as we focus on increasing long-term value for shareholders.

Same Property NOI - This is a key management tool used when evaluating the performance and growth of our Same Property portfolio. We define same properties as those we have owned and operated continuously since January 1, 2025. Same properties exclude ground-up development properties, acquired properties, properties classified as discontinued operations, properties impacted by catastrophic weather events, and properties sold after December 31, 2024. The Same Property data may change from time-to-time depending on acquisitions, dispositions, management discretion, significant transactions, or unique situations. Same Property NOI does not include the revenues and expenses related to home sales and ancillary activities at the properties. We believe that Same Property NOI is helpful to investors as a supplemental comparative performance measure of the income generated from the Same Property portfolio from one period to the next. For the UK segment, we present Same Property NOI growth rate information on a constant currency basis to provide a framework for assessing how our underlying properties performed after excluding the effects of changes in exchange rates. We believe that the presentation of UK Same Property NOI on a constant currency basis helps to improve the ability to understand our performance because it excludes the effects of foreign currency volatility which are not indicative of our core operating results in the region.

FFO is defined by the National Association of Real Estate Investment Trusts ("Nareit") as GAAP net income (loss), excluding gains (or losses) from sales of certain real estate assets, plus real estate related depreciation and amortization, gains (or losses) from change in control, impairments of certain real estate assets and investments, and after adjustments for nonconsolidated partnerships and joint ventures. FFO is a non-GAAP financial measure that management believes is a useful supplemental measure of our operating performance. By excluding gains and losses related to sales of previously depreciated operating real estate assets, real estate related impairment and 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 GAAP net income (loss). Management believes 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.

The following tables reconcile the Net income / (loss) attributable to SUI common shareholders to NOI and summarize our consolidated financial results for the three and six months ended MarchJune 31,30, 2026 and 2025 (in millions):

The RV andsegment UK segments areis seasonal and the results of operations in any one period may not be indicative of results in future periods.

In the RV segment, certain properties maintain higher occupancy during the summer months, while other properties maintain higher occupancy during the winter months. Based on the location of our properties with transient RV sites, our portfolio generally produces higher revenues between April and September than between October and March. In the UK segment, vacation rental sites generally produce higher revenues between March and October. During the threesix months ended MarchJune 31,30, 2026, we recognized aggregate Real property - transient revenue from our segmentsRV segment of $31.4$28.9 million in the first quarter and $60.6 million in the second quarter.

The following tables reflect certain financial and other information for our real estate operations by segment as of and for the three and six months ended MarchJune 31,30, 2026 and 2025 (in millions, except for statistical information).

(1) MH annual sites included 12,80013,130 and 11,26211,567 rental homes in our rental program as of MarchJune 31,30, 2026 and 2025, respectively. Our gross investment in occupied rental homes at MarchJune 31,30, 2026 was $961.0$979.3 million, an increase of 18.3%20.5% from $812.1$812.5 million at MarchJune 31,30, 2025.

For the three months ended MarchJune 31,30, 2026, the $20.5$19.2 million, or 9.1%8.0% increase in Real Property NOI as compared to the same period in 2025, consists of an increase of $10.8$14.8 million from Same Property MH NOI, an increase of $2.8 million from Same Property RV NOI, an increase of $0.2 million from Same Property UK NOI, and an NOI increase of $6.7$4.7 million, net from other recently acquired or developed properties and other items.items, partially offset by a decrease of $0.4 million from Same Property RV NOI.

Real Property Operations - North America Same Property Portfolio

In order to evaluate the growth of the Same Property portfolio, management has classified certain items differently than our GAAP statements. The reclassification difference between our GAAP statements and our Same Property portfolio is the reclassification of utility revenues from real property revenue to operating expenses. A significant portion of our utility charges are re-billed to our residents. Additionally, for the UK segment, the amounts in the tables below reflect constant currency for comparative purposes.

The following tables reflect certain financial and other information for our Same Property MH and RV portfolios as of and for the three and six months ended MarchJune 31,30, 2026 and 2025 (in millions, except for statistical information):

(1) Same Property adjusted blended occupancy for MH and RV combined remainedwas unchanged98.8% at 98.7%June 30, 2026, down 10 basis points from 98.9% at MarchJune 31, 2026, from 98.7% at March 31,30, 2025. Same Property blended occupancy for MH and RV was 98.2%98.3% at MarchJune 31,30, 2026, up 2030 basis points from 98.0% at MarchJune 31,30, 2025.

For the three months ended MarchJune 31,30, 2026 and 2025:

•The MH segment increase in NOI of $10.8$14.8 million, or 6.3%,8.8%, when compared to the same period in 2025 is primarily due to an increase in Real property (excluding transient) revenue of $15.2$14.4 million, or 6.7%6.2% and NOI outperformance in our Rental Program, partially offset by an increase in Same property operating expenses of $4.4 million, or 7.8%.Program. Real property (excluding transient) revenue increased primarily due to a 5.2%4.9% increase in monthly base rent and occupancy gains on a year-over-year basis.

•The UKRV segment increasedecrease in NOI of $0.2$0.4 million, or 1.6%,0.7%, when compared to the same period in 2025 is primarily due to a decrease in Transient revenue of $2.9 million, or 4.8% and an increase in Same Property operating expenses of $0.5 million, or 0.8%, partially offset by an increase in Real property (excluding transient) revenue of $1.0$3.0 million, or 3.7%3.8%. and an increase in Real property transient revenue of $0.5 million, or 27.6%, partially offset by anThe increase in Same propertyProperty operating expenses of $1.3 million, or 7.3%. The increase in Real property revenue was primarily due to a 5.0%an increase in monthlysupplies baseand rentrepairs per site.expense.

The following table reflects certain financial and statistical information for our home sales program for the three and six months ended MarchJune 31,30, 2026 and 2025 (in millions, except for average selling price and statistical information):

For the three months ended MarchJune 31,30, 2026, the 61.9%51.5% decrease in NOI was primarily driven by a 15.9%32.1% decrease in units sold, and a 4.4% decrease in NOI margin, primarily driven by fewer available sites in conjunction with reduced expansion and development activity.

For the threesix months ended MarchJune 31,30, 2026, the 1.0%55.5% decrease in NOI was primarily driven by a 2.2%25.3% decrease in units sold, and a 6.6% decrease in NOI margin, primarily driven by anfewer 11.4%available increasesites in homeconjunction costwith reduced expansion and sellingdevelopment expenses due to a change in the mix of homes sold.activity.

The following table summarizes other income and expenses for the three and six months ended MarchJune 31,30, 2026 and 2025 (in millions):

AssetN/M impairments= Percentage change is not meaningful. N/A = Not applicable Interest income - for the three and six months ended MarchJune 31,30, 2026, decreased due to asseta impairmentlower chargescash of $24.0 millionbalance in the2026 priorafter perioddeploying relatedcash to pre-constructionacquire developmentnew costsproperties, atpay sevendown debt, and repurchase shares of our MHcommon and RV properties at which the related development projects are no longer probable of being realized.stock. Refer to Note 13,7, "FairDebt Valueand Measurements,Line of Credit," and Note 8, "Equity and Temporary Equity," in our accompanying Condensed Consolidated Financial Statements for additional information.

InterestBrokerage expensecommissions and other, net - for the three and six months ended MarchJune 31,30, 2026, decreased primarily due to the settlementreceipt of $3.2business billioninterruption insurance proceeds from properties impacted by Hurricane Ian in debt2025, obligationsthat did not recur in 2025 using proceeds generated from the Safecurrent Harbor Sale.period.

OtherGeneral incomeand /administrative (expense), net - for the threesix months ended MarchJune 31,30, 2026, was an expense of $3.8 million, as compared to income of $5.7 million during the same period in 2025,increased primarily due to aaccelerated long-termshare-based leasecompensation terminationexpense lossof $13.8 million and severance costs of $4.4 million related to executive leadership transitions in the UK of $12.2 million in the current period, partially offset by a gain on an insurance recovery.2026. Refer to Note 15,9, "LeasesShare-Based Compensation," in our accompanying Condensed Consolidated Financial Statements for additional information.

IncomeAsset from nonconsolidated affiliatesimpairments - for the three and six months ended MarchJune 31,30, 2026, wasdecreased incomedue to asset impairment charges of $6.1$32.2 million,million related to three RV properties in 2025 as compared to incomeasset impairment charges of $3.0$14.1 million duringat thetwo sameMH periodand RV land development parcels in 2025, primarily due to increased performance of the Sungenia JV.2026. Refer to Note 6,13, "InvestmentsFair inValue Nonconsolidated Affiliates,Measurements," in our accompanying Condensed Consolidated Financial Statements for additional information.

Deferred tax benefitGain / (expenseloss) on foreign currency exchanges - for the three and six months ended MarchJune 31,30, 2026, was ana expensegain of $6.4$13.3 million and loss of $10.6 million, respectively, as compared to a benefitgain of $5.2$39.4 million and $48.1 million, respectively, during the same periodperiods in 2025, primarily due to fluctuationsthe influctuation interest expense deductions related to our operations inof the UKU.S. indollar eachversus period.the British pound sterling.

LossCurrent fromtax discontinued operations, netexpense - for the three and six months ended MarchJune 31,30, 2026, was zero,an expense of $0.6 million and $1.5 million, respectively, as compared to $18.5an expense of $2.6 million inand $3.8 million, respectively, during the same periodperiods in 2025, primarily due to increased tax obligations resulting from the Safe Harbor Sale in 2025.