SUN COMMUNITIES INC
For the period ended Dec 31, 2024. Filed Apr 1, 2025.
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Dec 31, 2024 · Filed Apr 1, 2025
Contents
Pay Versus Performance Table
The following table illustrates disclosed compensation from the Summary Compensation Table and compensation “actually paid” to our PEO and Non-PEO NEOs, as well as (i) our cumulative TSR performance, (ii) the TSR of the Dow Jones U.S. Real Estate Residential Index, (iii) our Net Income, and (iv) our Core FFO, our Company selected metric, for the years ended December 31, 2024, 2023, 2022, 2021 and 2020:
| Value of Initial Fixed $100Investment(1) Based On: | ||||||||
|---|---|---|---|---|---|---|---|---|
| Year | SummaryCompensationTable Totalfor PEO | CompensationActually Paidto PEO | AverageSummaryCompensationTable Total for Non-PEO NEOs | AverageCompensationActually Paidto Non-PEONEOs | TotalShareholderReturn | Dow Jones U.S.Real EstateResidentialIndex | NetIncome / (loss)(2) | Core FFO /Share |
| 2024 | $1,968,121 | $(1,998,961) | $2,765,681 | $1,908,646 | $92.68 | $118.20 | $93,900,000 | $6.81 |
| 2023 | $10,946,746 | $(21,335) | $2,844,291 | $2,225,608 | $97.75 | $104.78 | $(213,300,000) | $7.10 |
| 2022 | $14,966,582 | $(537,705) | $3,633,375 | $650,211 | $101.62 | $97.44 | $242,000,000 | $7.35 |
| 2021 | $13,828,288 | $31,577,299 | $4,197,956 | $7,604,150 | $145.84 | $142.12 | $380,200,000 | $6.51 |
| 2020 | $11,142,423 | $9,511,035 | $5,226,779 | $5,220,325 | $103.58 | $89.74 | $131,600,000 | $5.09 |
(1)This calculation assumes a $100.00 investment on December 31, 2019, a reinvestment of distributions and actual increase of the market value of our common stock relative to an initial investment of $100.00.
(2)Net Income / (loss) attributable to Sun Communities, Inc. common shareholders.
Our PEO and Non-PEO NEOs included in the table above are as follows:
| Year | PEO | Non-PEO NEOs |
| 2024 | Gary A. Shiffman | Fernando Castro-Caratini, Bruce D. Thelen, John B. McLaren, Aaron Weiss |
| 2023 | Gary A. Shiffman | Fernando Castro-Caratini, Bruce D. Thelen, Marc Farrugia, Aaron Weiss |
| 2022 | Gary A. Shiffman | Fernando Castro-Caratini, Karen J. Dearing, John B. McLaren, Bruce D. Thelen, Aaron Weiss |
| 2021 | Gary A. Shiffman | Karen J. Dearing, John B. McLaren, Bruce D. Thelen, Aaron Weiss |
| 2020 | Gary A. Shiffman | Karen J. Dearing, John B. McLaren, Bruce D. Thelen, Baxter R. Underwood |
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Differences in our summary compensation table amounts and compensation actually paid reflect the following:
| Year | 2024 | 2023 | 2022 | 2021 | 2020 | |||||
|---|---|---|---|---|---|---|---|---|---|---|
| PEO | Non-PEO NEOs | PEO | Non-PEO NEOs | PEO | Non-PEO NEOs | PEO | Non-PEO NEOs | PEO | Non-PEO NEOs | |
| Deduction for amounts reported under the “Stock Awards” in the summary compensation table | $(558,688) | $(2,027,585) | $(9,283,660) | $(1,918,623) | $(12,395,450) | $(2,284,748) | $(11,171,661) | $(2,877,390) | $(9,208,679) | $(4,361,230) |
| Increase based on ASC 718 fair value of awards granted during the year that remain unvested as of year end, determined as of year end | 451,303 | 1,720,542 | 7,561,009 | 1,562,608 | 9,536,728 | 1,757,757 | 17,581,362 | 4,169,907 | 8,972,498 | 4,533,145 |
| Increase based on ASC 718 fair value of awards granted during the year that vested during the year, determined as of vesting date | — | — | — | — | — | — | — | — | — | — |
| Increase / (deduction) for awards granted during prior year that were outstanding and unvested as of year end, determined based on change in ASC 718 fair value from prior year end to current year end | (4,431,955) | (673,926) | (8,671,507) | (356,644) | (10,955,590) | (2,231,046) | 11,147,435 | 1,988,939 | 86,515 | 43,861 |
| Increase / (deduction) for awards granted during prior year that vested during the year, determined based on change in ASC 718 fair value from prior year end to vesting date | (123,488) | (22,847) | (773,054) | (8,584) | (2,602,551) | (389,594) | (414,809) | (22,465) | (2,576,195) | (404,974) |
| Deduction of ASC 718 fair value of awards granted during prior year that were forfeited during current year, determined as of prior year end | — | — | (725,010) | — | — | — | (356,171) | (29,706) | — | — |
| 88 | Sun Communities, Inc. |
| Addition of any dividends or other earnings paid on equity awards during the year, prior to the vesting date that are not otherwise reflected in the fair value of such award or included in any other component of total compensation for the year | 695,746 | 146,781 | 924,141 | 102,560 | 912,577 | 164,467 | 962,854 | 176,909 | 1,094,473 | 182,743 |
|---|---|---|---|---|---|---|---|---|---|---|
| Total Adjustments | $(3,967,082) | $(857,035) | $(10,968,081) | $(618,683) | $(15,504,286) | $(2,983,164) | $17,749,010 | $3,406,194 | $(1,631,388) | $(6,455) |
Our compensation "actually paid" is heavily influenced by the fair value of equity awards from year to year. As stock price volatility and fluctuations in the stock market impact the valuations of our awards, our resulting compensation “actually paid” to our PEO and our Non-PEO NEOs can be higher or lower (or even negative, as shown for 2022 through 2024), than the figures disclosed in the summary compensation table. This is particularly true for our PEO, whose equity awards made up approximately 82% of total compensation for 2020 through 2023, and therefore have a significant impact on our overall "actually paid" compensation.
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Description of the Relationship Between Pay Versus Performance
The graphs below compare the compensation actually paid to our PEO and the average of the compensation actually paid to Non-PEO NEOs, with (i) our cumulative TSR, (ii) the TSR of the Dow Jones U.S. Real Estate Residential Index, (iii) our Net Income, and (iv) our Core FFO, for the years ended December 31, 2020, 2021, 2022, 2023 and 2024. TSR amounts reported in the graph assume an initial fixed investment of $100 and that all dividends were reinvested.
Our program is structured to pay for performance, with an annual incentive award that is largely tied to Core FFO Growth, Same Property Combined NOI Growth (of MH, RV, Marina, and UK), effective management of general and administrative expense growth and leverage, and sustainability initiatives, and had previously considered acquisitions and expansions and developments. Our program also includes long-term incentives that are primarily performance-based and align with investor interests as performance is solely predicated on our TSR performance versus that of the MSCI U.S. REIT Index with an absolute TSR modifier that caps our payouts if our return is negative. As such, our compensation paid and performance are strongly aligned, as shown in the graphs below:
(1) 2023 Net Income was ($213,300), which is not reflected in the chart above due to size restrictions.
| 90 | Sun Communities, Inc. |
Listing of Important Financial and Non-Financial Measures
The following table includes the most important financial and non-financial performance measures used by the Company for the fiscal year ended December 31, 2024, to link compensation actually paid to the company’s CEO and other NEOs to the Company’s performance.
| Performance Measures | Year Ended December 31, 2024 | Methodology Used to Calculate Financial Performance Measures | Reconciliations to Non-GAAP Financial Measures |
|---|---|---|---|
| Financial | |||
| Core FFO growth | $6.81 | FFO is a standard operating performance measure for REITs and is defined by 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 nonconsolidated partnerships and joint ventures. Core FFO is a primary operating measure in our publicly-reported earnings results, and is defined as FFO excluding certain gain and loss items that management considers unrelated to the operational and financial performance of our core business. | Refer to Appendix C for the reconciliation of Net Income to Core FFO |
| Same Property combined NOI growth - MH, RV, Marina, and UK | 4.3% | NOI is calculated by deducting direct property operating expenses from property operating revenues, thereby providing a measure of the actual operating performance of our properties. Same Properties are primarily those properties that we have owned and operated continuously since January 1, 2023 | Refer to (1) Appendix C for the reconciliation of Net Income to NOI and (2) table below for the breakdown of NOI |
| Non-Financial | |||
| Sustainability initiatives | Excelled | Performance is based on implementation and progress towards long-term commitments, including diversity, equity and inclusion goals and long-term carbon reduction goals. | N/A |
Breakdown of NOI
The following table shows the breakdown of total portfolio NOI for the fiscal year ended December 31, 2024, in millions:
| Year Ended December 31, 2024 | ||||||
|---|---|---|---|---|---|---|
| Same PropertyMH | Same Property RV | Same PropertyMarina | Same PropertyUK | Acquisitions and other | TotalPortfolio | |
| Real property NOI | $631.6 | $272.4 | $266.3 | $76.0 | $59.1 | $1,305.4 |
| Home sales | N/A | N/A | N/A | 61.4 | 35.4 | 96.8 |
| Service, retail, dining and entertainment NOI(1) | N/A | N/A | N/A | N/A | N/A | 56.2 |
| NOI | $631.6 | $272.4 | $266.3 | $137.4 | $94.5 | $1,458.4 |
(1)Service retail, dining entertainment NOI is shown at consolidated level due to immateriality.
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The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.