1. Given the ongoing challenges and weather-related volatility affecting your transient RV segment, how are you re-evaluating the strategic importance of this business to mitigate its disruptive impact on overall financial performance?
2. With two catastrophic storms in Florida impacting operations over the past three years, have you considered reducing your geographic exposure in the state or altering your investment strategy to mitigate increasing weather-related risks?
3. The displacement of residents occupying RV annual spaces resulted in a $1.5 million revenue drag in 2024; what concrete steps are you taking to address this issue to prevent similar impacts in 2025 and beyond?
4. Can you elaborate on the rationale behind paying off your term loan with equity, and how does this decision align with your overall strategy on leverage and financial flexibility, especially regarding potential acquisition opportunities?
5. Considering that new tenants are paying market rents 13% higher than previous tenants while renewals are at 5–6%, does this disparity indicate market rents are growing faster than your renewal rates, and how might this affect revenue growth and tenant turnover moving forward?

0027a2bca95e90ae868a3a5fa4e344c8a6212d43bef08780619382f5a25a3738

23794d91c53ae875c8e247d72561e35d9d06ee07c70c9e0dbcc977a6d161504a

- **New tenants are paying rents that are 13% higher** upon turnover, indicating strong demand and potential for revenue growth as leases renew and turnover occurs.  **[ELS_3403310_28]**
- The company has **enhanced financial flexibility** by repaying a $300 million unsecured term loan, improving the balance sheet for potential acquisitions or growth opportunities.  **[ELS_3403310_9]**
- **Florida properties have historically outperformed**, delivering NOI over **100 basis points higher** than the overall portfolio, demonstrating resilience and value despite weather events.  **[ELS_3403310_14]**

2623e2862cd82ab1912f3c63732f871beed27171fafac637283c43ec9d53d6a2

- **Leading indicators for the first quarter seasonal business are flat to maybe down slightly**, suggesting potential weakness in seasonal RV demand ahead.  **[ELS_3403310_24]**
- **Seasonal RV revenue decreased by 13% in the quarter**, mainly due to the winding down of construction and transitional workers in Florida after Hurricane Ian, and inclement weather impacting properties in the North and Northeast. This decrease could indicate ongoing challenges in driving seasonal revenue growth.  **[ELS_3403310_17]** **[ELS_3403310_15]**
- There is **uncertainty around future insurance costs**, especially with recent storm damages from Hurricane Helene and Hurricane Milton. Last year, following Hurricane Ian, the company experienced a **58% increase in insurance renewal rates**, and similar increases could **negatively impact expenses** moving forward.  **[ELS_3403310_27]** **[ELS_3403310_13]**

b8be8113e0850933434fc227d58023635a4fb571dac255183d491eb7fa0a0597

1. **Debt Refinancing and Equity Issuance**  
   **Q:** Why did you pay off debt with equity now?  
   **A:** We raised **$300 million** by selling **4.5 million shares at $70** to pay off debt carrying **6.05% interest** maturing in 2026, enhancing our financial flexibility and positioning ourselves for future opportunities. \[3\], \[4\]

2. **Florida Exposure Post-Hurricanes**  
   **Q:** Are you reconsidering your exposure to Florida after recent hurricanes?  
   **A:** Despite recent storms, Florida remains a strong market for us, consistently outperforming our overall portfolio by over **100 basis points**, even with weather events every couple of years. We continue to seek growth in Florida. \[8\]

3. **Acquisition Opportunities**  
   **Q:** Are you seeing more acquisition opportunities?  
   **A:** The acquisition market is currently slow with low inventory of institutional-quality assets. However, our improved balance sheet allows us to act quickly if opportunities arise. We own about **200** of the **3,000** investment-grade manufactured home communities and **200** of the **1,200** investment-grade RV parks. \[5\]

4. **MH Rental Rates and Mark-to-Market**  
   **Q:** What's the mark-to-market on rents, and how are new tenant rates compared to renewals?  
   **A:** New residents are paying rents **13%** higher than prior tenants, reflecting a double-digit mark-to-market. Renewals are seeing increases in the mid-single digits, creating a gap due to higher market rent growth driven by strong demand and inflation. \[0\], \[23\]

5. **RV Transient Business Outlook**  
   **Q:** How do you view the outlook for the RV transient business?  
   **A:** Transient demand is normalizing post-COVID, with performance affected by weather. We expect to perform well when weather is favorable. The transient segment is volatile but remains a valuable source of future annual customers. \[9\], \[10\], \[14\]

6. **Payroll Expense Management**  
   **Q:** How are you managing payroll expenses, and can this continue?  
   **A:** We've achieved payroll favorability by managing staff levels, cross-training, and scheduling efficiencies, especially in our RV properties. While we've realized significant savings, further efficiencies may be limited. \[1\], \[12\]

7. **Seasonal RV Performance**  
   **Q:** What is the outlook for seasonal RV revenues?  
   **A:** Fourth-quarter seasonal reservations are **92%** reserved, slightly higher than last year. First-quarter indicators are flat to slightly down but expected to pick up by year-end. \[18\], \[19\]

8. **Insurance Renewal Rates**  
   **Q:** How will recent hurricanes affect insurance renewal rates?  
   **A:** It's too early to tell. Renewal rates depend on claims history, and we'll know more as we go through the renewal process. The impact will be felt in the last nine months of 2025 due to our April 1 renewal. \[7\]

9. **Joint Venture Distribution**  
   **Q:** What was the nature of the $5 million JV distribution?  
   **A:** It resulted from refinancing loans secured by one of our JV assets. With our book investment basis at zero, excess cash is recognized as income per GAAP. \[17\]

10. **Displaced Residents Drag on Revenue**  
    **Q:** Can you quantify the revenue drag from displaced residents?  
    **A:** The drag was over **$1.5 million** in 2024 and is expected to ease to zero over time as operations normalize. \[22\]

a4b19fe46339c5bc6918916fe726cefbe1417138c845dab598177b78f0687b0e

Equity LifeStyle Properties, Inc. (ELS) is a Maryland-based real estate investment trust (REIT) specializing in owning and operating lifestyle-oriented properties. The company leases land to customers who own manufactured homes, recreational vehicles (RVs), cottages, or boats, and also offers short-term and long-term site rentals. ELS provides a community experience with amenities such as clubhouses, swimming pools, and golf courses, catering to retirees, vacationing families, and first-time homebuyers.  **[0000895417-24-000016_els-20221231.htm:4]** **[0000895417-24-000036_els-20231231.htm:3]** **[0000895417-24-000036_els-20231231.htm:112]** 

1. **Property Operations** - Owns and operates land lease properties, offering long-term and short-term site rentals for manufactured homes, RVs, cottages, and boats. Includes access to community amenities such as clubhouses, swimming pools, and golf courses.  **[0000895417-24-000016_els-20221231.htm:4]** **[0000895417-24-000036_els-20231231.htm:3]** **[0000895417-24-000036_els-20231231.htm:112]** 

2. **Home Sales and Rentals Operations** - Purchases, sells, and leases factory-built homes at its properties, providing affordable housing options and brokerage services for residents selling their homes.  **[0000895417-24-000036_els-20231231.htm:112]** **[0000895417-24-000016_els-20221231.htm:119]**

f76faf44ebe5b5482ed7c21df0965eeb8f352ea2f8795685fcf051c173b82429

Property Operations

- Rental Income

- Other Income

Home Sales and Rentals

- Gross Revenues from Home Sales

Membership

- Annual Subscriptions

- Upgrade Sales

Investments

- Interest Income

- Income from Other Investments

Total Revenue

8e3c6964d34bfab0a1da7719d4ef3132928443a0216bbc2f48770cf2969d0b5b

| Name               | Position                                              | Start Date         | Short Bio                                                                                                                                                                                                                     |
|--------------------|-------------------------------------------------------|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Marguerite Nader   | President and Chief Executive Officer                 | N/A                | Marguerite Nader serves as the **President and Chief Executive Officer** of ELS. Details about her start date or tenure as CEO are not provided.  **[0000895417-24-000102_exhibit322-certificationof.htm:0]** **[0000895417-24-000092_exhibit322-certificationof.htm:0]** **[0000895417-24-000067_exhibit322-certificationof.htm:0]** **[0000895417-24-000036_exhibit322-certificationof.htm:0]** **[0000895417-24-000025_exhibit322-certificationof.htm:0]** **[0000895417-24-000026_exhibit322-certificationof.htm:0]** **[0000895417-24-000024_exhibit322-certificationof.htm:0]** **[0000895417-24-000016_exhibit322-certificationof.htm:0]** **[0000895417-24-000026_els-20230930.htm:50]** **[0000895417-24-000016_els-20221231.htm:109]**                                               |
| Paul Seavey        | Executive Vice President and Chief Financial Officer  | February 2020      | Paul Seavey, **55 years old**, has been the **Executive Vice President and Chief Financial Officer** of ELS since **February 2020**. He joined the company in **1994** and has held various financial leadership roles.  **[0000895417-24-000054_els-20240318.htm:26]**  |
| Patrick Waite      | Executive Vice President and Chief Operating Officer  | January 2015       | Patrick Waite has been the **Executive Vice President and Chief Operating Officer** of ELS since **January 2015**. He joined ELS in **February 2013** and has extensive experience in the manufactured housing industry.  **[0000895417-24-000054_els-20240318.htm:26]** **[0000895417-23-000019_els-20230315.htm:27]**  |
| David Eldersveld   | Executive Vice President, Chief Legal Officer, and Corporate Secretary | February 2021      | David Eldersveld has been **Executive Vice President, Chief Legal Officer, and Corporate Secretary** of ELS since **February 2021**. He previously held senior legal roles at Tribune Company and Sidley Austin LLP.  **[0000895417-24-000054_els-20240318.htm:26]** **[0000895417-23-000019_els-20230315.htm:27]**  |

5aaa329e759512a108a82bc27d1356557d1274543c9af94e61cd0c02a1f706dc

- **Strong growth in Camp Pass membership sales**, indicating robust demand for ELS's products. In 2013, they sold 4,600 passes, and **last year, they sold almost 20,000**, demonstrating significant growth in their subscription offerings.  **[ELS_3413384_13]**
- **Effective cost management with anticipated savings in expenses**, as ELS guides expense growth to generally track CPI with savings in administrative expenses and membership commissions. This reflects management's ability to control costs and enhance profitability.  **[ELS_3413384_6]**
- **Ongoing expansion projects** with expectations to deliver **400 to 600 expansion sites in 2025**, particularly in high-demand areas like Florida. This supports future growth prospects and revenue generation.  **[ELS_3413384_17]**

270baade6a99c57b4a79a33e7bad1c81d4a93508213b5454f67c4d6c68a66823

- **Impact of Hurricanes on Operations**: **Hurricanes Helene, Milton, and Ian negatively impacted ELS's business in Florida**, leading to **attrition**, delays in **home sales**, and disruptions in operations. Home sales were **down over 30% year-over-year** in the fourth quarter due to these disruptions. Additionally, the hurricanes have caused **slowdowns in expansion projects** due to increased permitting timelines and blockages in county and city offices.  **[ELS_3413384_18]** **[ELS_3413384_17]** **[ELS_3413384_9]**
- **Decline in Memberships and RV Demand**: There has been a **sequential decrease in total memberships**, which was **higher than expected** beyond normal seasonality. The **1,000 Trails membership count in 2024 declined year-over-year** and is now **lower than 2020 levels**, despite an increase in sites from **24,800 in 2020 to 26,000 in 2024**. This suggests a potential **softening in RV demand**, impacting revenue growth prospects in the Thousand Trails portfolio.  **[ELS_3413384_20]** **[ELS_3413384_12]**
- **Reduced Guidance and Uncertainty in Revenue Streams**: ELS's guidance assumes **lower non-core NOI** for 2025 at **$10.8 million** compared to **$16 million in 2024**, partly due to the **timing of insurance recoveries** and non-stabilized operations of properties affected by hurricanes. Furthermore, there's **limited visibility into transient and seasonal revenues** due to **short booking windows**, with assumptions of revenues being **flat to slightly up**, indicating uncertainty and potential risk in these revenue streams.  **[ELS_3413384_17]** **[ELS_3413384_22]**

da22fbe5cf7ebb5e03504cb63dda058ed4bd851df36f43a7f775b03074b40e66

1. **Expense Guidance Drivers**  
   **Q:** What are the key drivers of expense guidance?  
   **A:** Expenses are guided to grow generally tracking **CPI**, with anticipated savings in administrative expenses and membership commissions. Real estate taxes are expected to grow at mid-single-digit rates, consistent with past experience.  **[ELS_3413384_6]** 

2. **Other Income Increase**  
   **Q:** What's causing the $4 million increase in other income?  
   **A:** The primary driver of the **$4 million** increase year-over-year is our expectation for sales and ancillary activity. We periodically receive joint venture distributions and anticipate a similar **$5 million** distribution in the first quarter of 2025.  **[ELS_3413384_7]** 

3. **Transient RV Softness**  
   **Q:** What's causing the softness in Q1 RV bookings, and outlook?  
   **A:** First-quarter guidance reflects current reservation pacing, showing softness due to disruptions from hurricanes impacting demand in Florida and a lag in our Canadian business. We expect trends to improve throughout the year as these factors abate and presidential election uncertainty is behind us.  **[ELS_3413384_8]** 

4. **Hurricane Impact on Home Sales**  
   **Q:** How are hurricanes affecting financials and home sales?  
   **A:** New home sales for the quarter were down over **30%** year-over-year, significantly due to disruptions from hurricanes. A mild start to the Sunbelt season and sold-out inventory in some locations also contributed. However, demand remains stable, and we're returning to a normal run rate for the MH business. All our properties are operational.  **[ELS_3413384_9]** 

5. **Thousand Trails Membership**  
   **Q:** What's causing the decline in Thousand Trails memberships?  
   **A:** Membership numbers fluctuated with a spike during COVID and current attrition as activities normalize. Over the last five years, membership subscription revenue has increased an average of over **5%**, focusing on growing recurring stable revenue.  **[ELS_3413384_12]** 

6. **Revenue Growth Discrepancy**  
   **Q:** What's causing the gap between base rental income growth and total core revenue guidance?  
   **A:** The gap is primarily due to lower growth in utility and other income. Specifically, the timing of recognizing business interruption insurance proceeds from prior storms impacts other income.  **[ELS_3413384_11]** 

7. **Insurance Renewal Impact**  
   **Q:** How will insurance renewals affect expenses?  
   **A:** An expense growth assumption for insurance is included in our guidance, but we're in the middle of renewals and negotiations, so specifics aren't disclosed. We'll provide updates on the next call.  **[ELS_3413384_15]** **[ELS_3413384_16]** 

8. **Expansion Sites Outlook**  
   **Q:** Will expansion sites return to previous levels?  
   **A:** Due to timing and longer timelines for entitlements and completion, we expect to deliver **400 to 600** expansion sites in 2025, below the five-year average of over 1,000. Approximately half of our expansion projects are in Florida, where increased permitting activity slows down the process.  **[ELS_3413384_17]** 

9. **Annual RV Site Attrition**  
   **Q:** Is churn returning to historical levels?  
   **A:** We experienced higher attrition in annual RV sites due to hurricanes and post-COVID normalization, particularly in the North and Northeast. We expect churn levels in 2025 to return to the historical **5%** level and to rebuild the business as we did pre-COVID.  **[ELS_3413384_18]** **[ELS_3413384_21]** 

10. **Non-Core NOI Guidance**  
    **Q:** Why is non-core NOI guidance lower than last year?  
    **A:** Non-core NOI is guided at **$10.8 million** for 2025, down from **$16 million** in 2024. The decrease is due to properties moving from non-core to core, timing of insurance recoveries received in 2024, and assumptions for 2025 NOI as certain non-core properties return to stabilized operations.  **[ELS_3413384_16]** 

11. **Business Interruption Income**  
    **Q:** What's assumed for business interruption income in 2025?  
    **A:** We collected around **$10 million** in business interruption income in 2024. For 2025, this is embedded in our assumptions but depends on the timing of returning to normal operations. As operations improve and generate NOI, we receive less business interruption income.  **[ELS_3413384_16]** 

9bc951c2b8b65e58ee8fbb703feb0a62def6a4ce2f5b1f410fb93bde9ad7460c

ELS’s Camp Pass membership soared from 4,600 in 2013 to nearly 20,000 last year. Q4 home sales, however, fell 30% YoY due to hurricane disruptions, with further membership softness in Thousand Trails. Management sees 400–600 new expansion sites in 2025.

d00233bab437c9bb75c2d529b52a432c1b18da53e708e4caab9bfb64150cdc2d

**Quarterly guidance for Q1 2025:**  
- **Core Property Operating Income Growth**: 3.6% to 4.2%  **[ELS_3413384_4]** (lowered from 6.7%  **[ELS_3403310_5]** )  
- **Normalized FFO per share**: $0.80 to $0.86  **[ELS_3413384_4]** (raised from $0.73 to $0.79  **[ELS_3403310_4]** )  
- **Core MH Rent Growth**: 5.8%  **[ELS_3413384_4]** (no prior guidance)  
- **Annual RV and Marina Rent Growth**: 3.8%  **[ELS_3413384_4]** (no prior guidance)  
- **Seasonal and Transient RV Revenues**: in line with current reservation pacing  **[ELS_3413384_4]** (no prior guidance)  

**Annual guidance for FY 2025:**  
- **Normalized FFO per share**: $3.01 to $3.11  **[ELS_3413384_4]** (raised from $2.89 to $2.95  **[ELS_3403310_4]** )  
- **Core Property Operating Income Growth**: 4.9%  **[ELS_3413384_4]** (lowered from 6.3%  **[ELS_3403310_5]** )  
- **Core MH Rent Growth**: 5.2% to 6.2%  **[ELS_3413384_4]** (lowered from 5.8% to 6.4%  **[ELS_3403310_5]** )  
- **Combined RV and Marina Rent Growth**: 2.7% to 3.7%  **[ELS_3413384_4]** (raised from 2.7% to 3.3%  **[ELS_3403310_5]** )  
- **Core Property Operating Expenses Growth**: 2% to 3%  **[ELS_3413384_4]** (lowered from 2.6% to 3.2%  **[ELS_3403310_5]** )  
- **Noncore Property NOI**: $8.8 million to $12.8 million  **[ELS_3413384_4]** (no prior guidance)  
- **Property Management and G&A Expenses**: $120 million to $126 million  **[ELS_3413384_4]** (no prior guidance)  
- **Dividend Policy**: $2.06 per share  **[ELS_3413384_0]** (no prior guidance)  
- **Discretionary capital**: $100 million  **[ELS_3413384_0]** (no prior guidance)  

13ce7faa4942f71bce11414e6ad11c3848865e03bef47c49fab85167f2738f3c

b076c4d24dde3f343610026f42df039c50662c62aa6b50c1f25a7ceee9ac293e

f8dedfc1fbf3dc0e1f07968f18bec9242b796444de001b46985ffb3a4f4dcbe9

Equity LifeStyle Properties Inc (ELS)

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