Good day, ladies and gentlemen and thank you for standing by. And welcome to the Sun Communities' First Quarter 2017 Earnings Conference Call on April 27, 2017. At this time, management would like me to inform you that certain statements made during this conference call, which are not historical facts, may be deemed forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Although the company believes the expectations reflected in any forward-looking statements are based on reasonable assumption, the company can provide no assurance that its expectations will be achieved. Factors and risks that could cause actual results to differ materially from expectations are detailed in this morning's press release and from time to time in the company's periodic filings with the SEC. The company undertakes no obligation to advise or update any forward-looking statements to reflect events or circumstances after the date of this release. Having said that, I would like to introduce management with us today; Gary Shiffman, Chairman and Chief Executive Officer, John McLaren, President and Chief Operating Officer, and Karen Dearing, Chief Financial Officer. After the team’s remarks there will an opportunity to ask questions. I’ll now turn the call over to Gary Shiffman. Mr. Shiffman, you may begin.

Good morning. And thank you for joining our first quarter earnings call. I’m pleased to share that 2017 has gotten off to an excellent start with Same Community NOI growth of 6.7%, strong occupancy gains of 170 basis points in our Same Community portfolio and 40 basis points in the portfolio overall, as well as an 8% increase in the number of homes sold. While the quarter was a relatively quiet one from an external growth perspective, our prior hard work on that front coupled with our best-in-class operating platform and focus on sustained internal growth allowed Sun to deliver 22% FFO per share growth, a growth rate that we are certainly very proud of. In the quarter, we permitted over 500 manufactured housing expansion sites that were completed late in the fourth quarter of 2016 and delivered over 250 newly built manufactured housing expansion sites in three communities as part of our 2017 expansion program. We are on track to deliver an additional 870 expansion sites in 10 communities in the second quarter. On the [earnings] side of our business, we converted over 200 transient sites to annual seasonal rentals as compared to approximately 150 conversions in first quarter of 2016. On the external growth front, we continue to utilize our deep relationships and market knowledge to selective high-quality acquisitions which enhance our portfolio in strategic direction. Our pipeline is very active and we expect our acquisition pace to reflect similar levels of activity to that of our prior years with respect to one-off transactions. We also continue to seek out one to two development opportunities each year. As previously discussed our selective developments and redevelopments will focus on increasing our presence in high barrier-to-entry states and resort for waterfront destinations where we believe we can generate strong returns…

Thank you, Gary. Sun delivered another excellent quarter of operating results. Total revenues increased by over 34% as compared to the same quarter in 2016 reflecting both the contribution of Carefree, as well as sustained strength across multiple revenue streams of our platform. We added 687 revenue producing sites during the quarter which boosted total occupancy to 95.9%, up 40 basis points from the prior year. Additionally, we sold 826 homes in the quarter, up 8% on a year-over-year basis, of these 240 or approximately 30% of total sales were former occupied rental homes. Our Same Community results were strong across the board with NOI increasing by 6.7%. Same Community revenues were up 5.2% on occupancy growth of 170 basis points and monthly base rent growth of 3.3%, Same Community expenses increased by 1.1% lower than anticipated predominantly due to timing of certain expenses, which Karen will discuss momentarily. We anticipate continued strong Same Community performance throughout the year given sustained demand for our high quality communities. On the Carefree front it is performing ahead of our original underwriting and in line with our budget for the first quarter of 2017. Metrics across portfolio in terms of product type were consistent with the MH Same Community revenues up 5.2%, while RV Same Community revenues were up 5.8%. On the non-Same Community RV front of which Carefree is the significant contributor, we are closing on a highly successful southern RV season and look forward to a strong summer vacation season in our northern resorts. Our call center reservations are up 44% year-to-date and are transient rental sites and are Same Community portfolio are now 65% booked for the upcoming season as compared to 56% at the same time last year. On a total portfolio basis transient sites are 63% booked for…

Thanks, John. Sun reported for $1.10 of FFO per share on the diluted basis, up 22% over Q1, 2016 reflecting the addition of Carefree and that strengthen our Same Community portfolio. Our Same Community showed strong topline growth and benefited from the impact of timing differences on certainty expense line item. Property, operating and maintenance expenses and real estate taxes grew by 1% and 1.4% respectively for the quarter. Supply and repair costs including certain community maintenance expenses were lower than expected in Q1 which is due to timing. The expected year-over-year real estate tax increase will accelerate as the year progresses due to prior year real estate tax expense not having been readably incurred. We expect to be within our original guidance for property operating and maintenance and real estate taxes by year-end. We reiterate our previous FFO per share guidance for the year in the range of $4.16 to $4.24 per diluted share with full year Same Community NOI growth in the range of 6.4% to 6.8%. For the second quarter, we anticipate FFO per diluted share to be in the range of $0.93 to $0.95. As noted in our Q4, 2016 earnings release we raised roughly $21 million in net proceeds through our aftermarket equity sales program in January, 2017 by selling approximately 281,000 shares at a weighted average price of $76.47. At quarter end, we had $3.1 billion of debt outstanding with the weighted average interest rate of 4.45%, and a weighted average maturity of 8.2 years. Having addressed the number of our 2017 debt maturities in the fourth quarter of last year, we have only $4 million of debt maturing in the remainder of this year. We finished the quarter with roughly $11 million of cash on hand and $272 million of capacity on our line of credit. As Gary mentioned earlier, our debt ratios have continued to improve reflecting the additional quarters of Carefree in our trailing 12 month EBITDA. Our net debt to trailing 12 month EBITDA was seven times at the end of the first quarter have return better on a sequential basis and 2.1 times better as compared to June 30, 2016 when we close on Carefree. This puts us on track to achieve our expected leverage range of mid six times net debt to EBITDA by mid 2017. On Tuesday of this week we completed the refinancing of our existing line of credit. We increase the size by $200 million to $650 million and we’re able to improve our interest-rate spread as well as other terms. And with that, I’d like to open up the call to questions. Operator?

Thank you. We'll now begin the question-and-answer session. [Operator Instructions] Our first question comes from line of Nick Joseph with Citigroup. Please proceed with your question.

Thanks. John you mentioned that first quarter FFO required for those $0.03 ahead of guidance. I am just curious why that – is it rolling and in turn updated full-year for FFO guidance number. If there’s any kind of timing issues that should be offset later in the year?

Yes, Nick. Yes, I mentioned the Q1 outperformance is really due in large part to expense timing, rather than revenue outperformance. In the same community we had some community maintenance expenses and also advertising and health insurance costs that were lower than what we had originally expected and we believe that a significant portion of those will be incurred later this year. We also saw similar timing items in the non-same community expenses and in some of the total portfolio and for the expenses.

Thanks. So, then same-store NOI guidance was maintained or the underline same-store revenue and expense guidance also maintained or if the components there has shifted?

No, we are maintaining the underlying revenue and expense line items for same community.

In terms of same-store revenue I think you guided to 5.6 to 5.8, it came in at 5.2 in the first quarter. So can you talk about where you think you are expecting underlying assumptions that will be into that midpoint?

Yes, there is Q1 revenue were pretty much in line with what we had expected and there is seasonality in the same community NOI revenue and expense performance. We don’t provide quarterly same community NOI guidance, but we do and did with our guidance for 2017 we did provide quarterly FFO seasonality and I think one could refer that the same community NOI growth with sort of follow that pattern that Q3 would be the highest NOI growth and Q2 would be the lowest.

Thanks.

Thank you. Our next question comes from the line of Gwen Clark with Evercore ISI. Please proceed with your question.

Hi, good morning. Can you just talk about which markets are doing the best so far this year and then also which ones are the weakest?

I heard the beginning of regarding the best markets, what was last part, Gwen?

Oh, the weakest one, sorry.

So, I think overall the portfolio is just really performing as expected. Our major markets are all in line with one and other. Not really seeing much distinction in the markets I don’t know, but John do you have anything to add to that?

The only thing I would add is Gwen, relative to the budgets and the expectations we have for '17 reiterating what Karen said, I mean everything is pretty much performing in line with where our expectations were.

Okay. Thanks. Just another quick one. Can you remind us how do you underwrite the RV developments, both in terms of the stabilized yield that you target in any of these stuff?

So, I will let John speak to the least up, but it’s actually part of the model. We look for stabilization in the RV development between 24 and 36 months. They are under in to an 8 to 10 return at stabilization. One of the differences between the RV development and manufactured housing development is we can reach stabilization a little bit faster in the RV developments just due to the factored upon day one. They are available to all the [transient traffic] and as we convert into seasonal annual the occupancies are a lot faster than developing a manufactured housing community, which we underwrite with an occupancy absorption of about six to eight sites per year and it’s about 36 months or 48 months to stabilization in manufactured housing. Basically, the same type of stabilized return.

Okay, that’s helpful. Sorry and just one last quick one. Do you have an estimate for how many RV developments might be under construction today in the U.S.?

Across the country really nothing on top of my head and as far as I know I think that we are the ones that are doing mostly the development within the industry right now. I mean I know there is some operators are doing smaller expansion projects and things like that, but nobody as I am aware of that’s doing sort of ground-up development.

Okay, great. Thank you.

Thank you. Our next question comes from the line of Drew Babin with Robert W. Baird. Please proceed with your question.

Good morning.

Good morning.

Good morning.

Could you talk about the Myrtle Beach development and apologies if I missed this, but what is the total on investment you would project for the development all in?

Drew, hey, this is John. Well, with Myrtle Beach like Gary mentioned earlier it can be built out when it’s done at 775 sites, that’s a large community, so we are going to take it in phases with really Phase I investment will be about somewhere in the $13 million to $15 million range taken through those steps.

[How many sites] John does that would represent?

That would represent like the first 200-250 sites.

So, I think if you just took it from there multiplied out to 775 put in a factory per inflation. This will be slowly built up depending upon demand, Drew, and I think that’s the nice thing that we are able to do with the developments and time and according to absorption and what the market demand is before we expand beyond first phases.

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I think just tenacity. It’s very, very challenging to get entitlement and zoning for both manufactured housing and RV, especially in the highly desirable areas. Often times there will be a set of good circumstances where a city is looking for growth and there may be a local municipal representation in the owner group of a particular parcel of land, and that kind of paves the way to make things a little bit smoother. And then the final thing that I would suggest is that the experience and the portfolio that we can put in front of the municipalities, and the zoning entitlement bodies really helps, and the best example that is what’s going on the with the San Diego development. There were a host of people bidding to redevelop an existing RV community on the Bay, and the municipality is building a very large convention center on the site. So, they wanted to move the community a couple of miles down shore and it was the ability for Sun to talk about the experience in the development and show the type of product that we do develop that allowed us to be awarded that particular example, but would I share with you for every one or two that we get is zoned, there’s probably five or six that get rejected and that’s after the 10 or 12 that we reviewed and didn’t even take to the step of looking at entitlement and zoning. So, it’s what keeps the demand so high in our industry and it’s frustrating sometimes that we can’t expand and develop a little bit more, but at the same time it’s shortage of supply. So it’s a good thing as well.

That’s helpful. Thank you.

[Operator Instructions] Our next question comes from the line of [Indiscernible] with Bank of America/Merrill Lynch. Please proceed with your question.

Hey, good morning, guys.

Hey, good morning.

Is there any other landside in your portfolio where you're working on entitlement or zoning or Myrtle Beach like the only one that weren’t [out for sale]?

Well, I would just add that, as we’re burning through an inventory of 8,000 to 10,000 expansion sites that we have at a rate of 2000 a year right now, we've got to be very very focused on replenishing that inventory. So one of the projects for 2017 is to identify additional contiguous land for rezoning next to our existing communities and we’re very very focused on that. To Drew's question before and [Josh], I would just add that, it's much easier to entitle adjacent land than it is a new development site. So, that’s one part of the question. The second part is that we are out there working very, very diligently to be able to know that we can develop one to two ground-ups per year and that means we guess as I said, I have to turnover lot of rocks to get to that point. One of things that Sun has begun to identify is the process of redeveloping existing maybe functionally obsolete communities that have the underlying zoning and entitlement in place and that is what we’re doing in our Larkspur Colorado property where we’ll take – how many sites that the existing, John?

148 sites.

148 and acquire the existing land which was easier to entitle and turn it into a 500 site modern communities or so.

Interesting, how many [Indiscernible] substantial part of part of the market?

As far as redeveloping existing communities with entitlement, it’s hard. Its -- first all you got to be able to acquire them and purchase them at a price that when their complete development is [read-on] because you're basically buying them for an NOI and then you're scraping them to the ground and rebuilding everything from the infrastructure underground all the way up. So, they've got to be bought properly and the highly desirable locations obviously are costly. So it something we will continue to do in onesides and twosides, but I don't think there's an abundant opportunity out there to start doing those type of redevelopments.

Okay. Thanks guys.

Thank you. Our next question comes from the line of Ryan Burke with Green Street Advisors. Please proceed with your questions.

Thank you. Just one question at this point. Tax reform is obviously very topical and what it will ultimately look like is very uncertain. It does seem that there's some evidence that suggested that the 1031 exchange could go away or that's the least one that more likely outcomes. Given the feel for how often private investors utilize 1031 in MH and RV and I guess probably more important are you seeing any uptick in interest in OP unit deals as another form of DAC tax deferral for sellers or would you expect an uptick?

Yes. It’s Gary again. I think that it’s very very seldom that we've experienced tax-free exchange from a seller maybe a couple of times over the last 20 years. So it hasn't been something that's been very significant in the transactions we've done. On the other hand, the OP units and the preferred operating partnership units that we've used to structure many of our small and large transactions continue to be of interest. And I guess I would suggest that I have not experienced or heard of anything from our acquisition department that would indicate they have seen any kind of change in sentiment out there.

Okay. Thanks Gary.

Thank you. Our next question comes from the line of Jason Belcher with Wells Fargo. Please proceed with your questions.

Hi. Sorry, if I missed this, but wondering if you can give us an update on what you're seeing in terms of cap rate trends in the broader acquisition market as well as for your recent acquisitions?

Yes. Again Jason, it’s Gary. We have really not seen anything change on a cap rate front. The transactions are taking place in a five to six cap rate range for the very high quality communities. And I have seen and continue to see for handles on things like very special communities are communities in California in particular, but not a lot has changed on the base cap rates. The property that we acquired in California this past quarter which we’re very pleased. We were able to acquire had a six cap rate. So on the higher end of that spread and I think that was just a very unique opportunity.

Great. Thank you. And then secondly, can you guys update us on age-restricted mix across the overall portfolio and also what that looks like within the current investment pipeline?

Currently our age-restricted is about 33% of our portfolio on a site basis.

And I would share of because I’m most involved in the acquisition pipeline. That pipeline is very, very homogenous across all types; RV, MH, senior, all age and one of the benefits that we have right now is that we’re very discerning and very selective what we are acquiring so that all the hard work we've done on building the high-quality portfolio is maintained. So I would expect to see things continue basically in the percentages that the existing portfolio is in.

Great. Thanks a lot.

Thank you. Ladies and gentlemen there are no further questions. At this time I’ll turn the floor back to management for final remarks.

It’s always a pleasure to be able to deliver these kinds of quarterly results. The entire management staff is available for any follow-up questions. And we definitely look forward to speaking to everybody on our call after second quarter. Thank you.

Thank you. This concludes today’s teleconference. You may disconnect your lines at this time. Thank you for your participation.