Sun Communities, Inc. Makes Strategic Investment in Ingenia Communities, a Leading Owner and Operator of Manufactured Housing and Recreational Vehicle Communities in Australia
Southfield, MI, Nov. 06, 2018 (GLOBE NEWSWIRE) -- Sun Communities, Inc. (NYSE:SUI) (the “Company”), a real estate investment trust (“REIT”) that owns and operates or has an interest in manufactured housing and recreational vehicle communities, today announced a strategic investment in Ingenia Communities Group (ASX: INA), a leading owner, operator and developer of senior manufactured housing communities and holiday resorts in Australia, as well as a development joint venture with Ingenia.
Sun will invest approximately US$54 million for a 9.9% ownership stake in Ingenia. Sun and Ingenia will also form a 50/50 joint venture to establish and grow a manufactured housing community development program in Australia.
The transaction represents a unique opportunity for Sun shareholders, who will benefit from investments in both Ingenia, which has delivered strong earnings growth over the past few years and has a large existing acquisition and development pipeline, as well as a development joint venture poised to capitalize on the sector’s positive trends. Ingenia benefits from Sun’s meaningful initial capital investment, ongoing financial support through the joint venture and the ability to leverage Sun’s experience as a leading owner, operator and developer of manufactured housing and recreational vehicle communities.
The Australian Manufactured Housing and RV Community sector is highly fragmented and traditional housing, on a relative basis, is increasingly expensive. Over the past 20 years, median home prices in key Australian capital cities have appreciated between 200% and 400%. Furthermore, there is a limited supply of high quality Manufactured Housing and RV communities. Industry fundamentals and Australian demographic trends provide long term support for the sector’s growth prospects. There is a particular need for affordable seniors housing as the over-55 population is expected to grow at twice the rate of the rest of the Australian population.
“We are extremely excited about investing in and alongside Ingenia and believe this venture provides a unique opportunity for Sun to strategically invest in the Australian MH and RV sector. Ingenia is a market leading operator, owner and developer of an attractive portfolio of communities across Australia. We have been actively monitoring the Australian market for some time given the sector’s similarly attractive attributes to the North American market. The Australian MH and RV sector is early in its growth cycle, is primed for consolidation, benefits from strong demographic trends and has very favorable supply and demand dynamics,” stated Gary Shiffman, Chairman and Chief Executive Officer of Sun Communities.
“We have spent considerable time with Ingenia Board and management team members and have found their business model and culture to be highly compatible with that of Sun’s. This transaction provides our shareholders with an attractive opportunity to benefit from the growth potential of an emerging leader in the Australian sector and creates an opportunity for Sun to leverage its expertise to help accelerate that growth. We are pleased to be partnering with Ingenia’s strong and proven management team as they continue to grow their platform which has the largest development pipeline in Australia,” added Mr. Shiffman.
“We are pleased to partner with Sun as we capitalize on the exciting opportunities for growth we have identified in the emerging Australian market. Working with a leading operator who has a long history in the mature North American market and is aligned strategically and economically with our objectives will allow Ingenia to accelerate growth as we leverage our platform and pipeline,” said Simon Owen, Managing Director and Chief Executive Officer of Ingenia Communities Group.
Upon completion of the investment, Mr. Shiffman will join Ingenia’s Board of Directors. Ingenia will manage the development and operations of the communities in the joint venture. This international investment opportunity provides Sun with a well-regarded established partner and the ability to capitalize on highly attractive Australian market dynamics with parallels to that of North America.
About Ingenia Communities
Ingenia Communities Group (ASX: INA) is a leading operator, owner and developer of a growing portfolio of lifestyle and tourism communities across key Australian urban and coastal markets. Ingenia has a diversified portfolio of 61 rental, lifestyle and holiday communities, comprised of over 7,000 income producing sites and a development pipeline of over 3,000 sites.
About Sun Communities
Sun Communities, Inc. is a REIT that, as of September 30, 2018, owned, operated, or had an interest in a portfolio of 370 communities comprising over 127,000 developed sites in 31 states and Ontario, Canada.
For more information about Sun Communities, Inc., please visit www.suncommunities.com.
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 the Company’s 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, 2017.
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.