10-K
Table of Contents

 
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 
Washington, D.C. 20549
Form 10-K
 
     
þ
  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
    For the Fiscal Year Ended December 31, 2008
or
o
  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
Commission File Number: 1-11718
 
EQUITY LIFESTYLE PROPERTIES, INC.
(Exact name of registrant as specified in its charter)
 
     
Maryland
(State or Other Jurisdiction of
Incorporation or Organization)
  36-3857664
(I.R.S. Employer
Identification No.)
Two North Riverside Plaza, Suite 800,
Chicago, Illinois
(Address of Principal Executive Offices)
  60606
(Zip Code)
 
(Registrant’s telephone number, including area code)
(312) 279-1400
Securities registered pursuant to Section 12(b) of the Act:
 
     
(Title of Class)
 
(Name of Exchange on Which Registered)
 
Common Stock, $.01 Par Value
  New York Stock Exchange
 
Securities registered pursuant to Section 12(g) of the Act:
None
 
Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.  Yes þ     No o
 
Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.  Yes o     No þ
 
Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes þ     No o
 
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  o
 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
 
             
Large accelerated filer þ     
  Accelerated filer o        Non-accelerated filer o 
(Do not check if smaller reporting company)
  Smaller reporting company o
 
Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes o     No þ
 
The aggregate market value of voting stock held by non-affiliates was approximately $980.2 million as of June 30, 2008 based upon the closing price of $44.00 on such date using beneficial ownership of stock rules adopted pursuant to Section 13 of the Securities Exchange Act of 1934 to exclude voting stock owned by Directors and Officers, some of whom may not be held to be affiliates upon judicial determination.
 
At February 19, 2009, 25,227,540 shares of the Registrant’s common stock were outstanding.
 
DOCUMENTS INCORPORATED BY REFERENCE:
 
Part III incorporates by reference portions of the Registrant’s Proxy Statement relating to the Annual Meeting of Stockholders to be held on May 12, 2009.
 


 

 
Equity LifeStyle Properties, Inc.
 
 
TABLE OF CONTENTS
 
                 
       
Page
 
      Business     3  
      Risk Factors     9  
      Unresolved Staff Comments     18  
      Properties     18  
      Legal Proceedings     26  
      Submission of Matters to a Vote of Security Holders     33  
 
PART II.
      Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities     34  
      Selected Financial Data     35  
      Management’s Discussion and Analysis of Financial Condition and Results of Operations     37  
      Quantitative and Qualitative Disclosures About Market Risk     61  
      Forward-Looking Statements     61  
      Financial Statements and Supplementary Data     62  
      Changes in and Disagreements with Accountants on Accounting and Financial Disclosure     62  
      Controls and Procedures     62  
      Other Information     63  
 
PART III.
      Directors, Executive Officers and Corporate Governance     64  
      Executive Compensation     64  
      Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters     64  
      Certain Relationships and Related Transactions and Director Independence     64  
      Principal Accountant Fees and Services     64  
 
PART IV.
      Exhibits and Financial Statement Schedules     65  
 EX-12
 EX-21
 EX-23
 EX-24.1
 EX-24.2
 EX-24.3
 EX-24.4
 EX-24.5
 EX-24.6
 EX-24.7
 EX-24.8
 EX-31.1
 EX-31.2
 EX-32.1
 EX-32.2


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PART I
 
Item 1.   Business
 
Equity LifeStyle Properties, Inc.
 
General
 
Equity LifeStyle Properties, Inc., a Maryland corporation, together with MHC Operating Limited Partnership (the “Operating Partnership”) and other consolidated subsidiaries (“Subsidiaries”), is referred to herein as the “Company,” “ELS,” “we,” “us,” and “our.” ELS has elected to be taxed as a real estate investment trust (“REIT”), for U.S. federal income tax purposes commencing with its taxable year ended December 31, 1993.
 
The Company is a fully integrated owner and operator of lifestyle-oriented properties (“Properties”). The Company leases individual developed areas (“sites”) with access to utilities for placement of factory built homes, cottages, cabins or recreational vehicles (“RVs”). Customers may lease individual sites or purchase right-to-use contracts providing the customer access to specific Properties for limited stays. The Company was formed in December 1992 to continue the property operations, business objectives and acquisition strategies of an entity that had owned and operated Properties since 1969. As of December 31, 2008, we owned or had an ownership interest in a portfolio of 309 Properties located throughout the United States and Canada consisting of 112,074 residential sites. These Properties are located in 28 states and British Columbia (with the number of Properties in each state or province shown parenthetically) as follows: Florida (86), California (48), Arizona (35), Texas (15), Pennsylvania (13), Washington (14), Colorado (10), Oregon (9), North Carolina (8), Delaware (7), New York (6), Nevada (6), Virginia (6), Wisconsin (6), Indiana (5), Maine (5), Illinois (4), Massachusetts (4), New Jersey (4), Michigan (3), South Carolina (3), New Hampshire (2), Ohio (2), Tennessee (2), Utah (2), Alabama (1), Kentucky (1), Montana (1), and British Columbia (1).
 
Properties are designed and improved for several home options of various sizes and designs that are produced off-site, installed and set on designated sites (“Site Set”) within the Properties. These homes can range from 400 to over 2,000 square feet. The smallest of these are referred to as “Resort Cottages.” Properties may also have sites that can accommodate a variety of RVs. Properties generally contain centralized entrances, internal road systems and designated sites. In addition, Properties often provide a clubhouse for social activities and recreation and other amenities, which may include restaurants, swimming pools, golf courses, lawn bowling, shuffleboard courts, tennis courts, laundry facilities and cable television service. In some cases, utilities are provided or arranged for by us; otherwise, the customer contracts for the utility directly. Some Properties provide water and sewer service through municipal or regulated utilities, while others provide these services to customers from on-site facilities. Properties generally are designed to attract retirees, empty-nesters, vacationers and second home owners; however, certain of our Properties focus on affordable housing for families. We focus on owning properties in or near large metropolitan markets and retirement and vacation destinations.
 
Employees and Organizational Structure
 
We have approximately 3,000 full-time, part-time and seasonal employees dedicated to carrying out our operating philosophy and strategies of value enhancement and service to our customers. The operations of each Property are coordinated by an on-site team of employees that typically includes a manager, clerical and maintenance workers, each of whom works to provide maintenance and care of the Properties. Direct supervision of on-site management is the responsibility of our regional vice presidents and regional and district managers. These individuals have significant experience in addressing the needs of customers and in finding or creating innovative approaches to maximize value and increase cash flow from property operations. Complementing this field management staff are approximately 125 full-time corporate employees who assist on-site management in all property functions.
 
Formation of the Company
 
The operations of the Company are conducted primarily through the Operating Partnership. The Company contributed the proceeds from its initial public offering and subsequent offerings to the Operating Partnership


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for a general partnership interest. In 2004, the general partnership interest was contributed to MHC Trust, a private REIT subsidiary owned by the Company. The financial results of the Operating Partnership and the Subsidiaries are consolidated in the Company’s consolidated financial statements. In addition, since certain activities, if performed by the Company, may not be qualifying REIT activities under the Internal Revenue Code of 1986, as amended (the “Code”), the Company has formed taxable REIT subsidiaries, as defined in the Code, to engage in such activities.
 
Several Properties are wholly owned by taxable REIT subsidiaries of the Company. In addition, Realty Systems, Inc. (“RSI”) is a wholly owned taxable REIT subsidiary of the Company that is engaged in the business of purchasing and selling or leasing site set homes that are located in Properties owned and managed by the Company. RSI also provides brokerage services to residents at such Properties for those residents who move from a Property but do not relocate their homes. RSI may provide brokerage services, in competition with other local brokers, by seeking buyers for the site set homes. Subsidiaries of RSI also lease from the Operating Partnership certain real property within or adjacent to certain Properties consisting of golf courses, pro shops, stores and restaurants.
 
Business Objectives and Operating Strategies
 
Our strategy seeks to maximize both current income and long-term growth in income. We focus on properties that have strong cash flow and we expect to hold such properties for long-term investment and capital appreciation. In determining cash flow potential, we evaluate our ability to attract and retain high quality customers in our Properties who take pride in the Property and in their home. These business objectives and their implementation are determined by our Board of Directors and may be changed at any time. Our investment, operating and financing approach includes:
 
  •  Providing consistently high levels of services and amenities in attractive surroundings to foster a strong sense of community and pride of home ownership;
 
  •  Efficiently managing the properties to increase operating margins by controlling expenses, increasing occupancy and maintaining competitive market rents;
 
  •  Increasing income and property values by continuing the strategic expansion and, where appropriate, renovation of the Properties;
 
  •  Utilizing management information systems to evaluate potential acquisitions, identify and track competing properties and monitor customer satisfaction;
 
  •  Selectively acquiring properties that have potential for long-term cash flow growth and to create property concentrations in and around major metropolitan areas and retirement or vacation destinations to capitalize on operating synergies and incremental efficiencies; and
 
  •  Managing our debt balances such that we maintain financial flexibility, minimize exposure to interest rate fluctuations, and maintain an appropriate degree of leverage to maximize return on capital.
 
Our strategy is to own and operate the highest quality properties in sought-after locations near urban areas, retirement and vacation destinations across the United States. We focus on creating an attractive residential environment by providing a well-maintained, comfortable Property with a variety of organized recreational and social activities and superior amenities as well as offering a multitude of lifestyle housing choices. In addition, we regularly conduct evaluations of the cost of housing in the marketplaces in which our Properties are located and survey rental rates of competing properties. From time to time we also conduct satisfaction surveys of our customers to determine the factors they consider most important in choosing a property. We improve site utilization and efficiency by tracking types of customers and usage patterns and marketing to those specific customer groups.
 
Acquisitions and Dispositions
 
Over the last decade our portfolio of Properties has grown significantly from owning or having an interest in 154 Properties with over 53,000 sites to owning or having an interest in 309 Properties with over 112,000 sites.


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We continually review the Properties in our portfolio to ensure that they fit our business objectives. Over the last five years we sold 14 Properties, and we redeployed capital to markets we believe have greater long-term potential. In that same time period we acquired 180 Properties located in high growth areas such as Florida, Arizona and California.
 
On August 14, 2008, the Company acquired substantially all of the assets and certain liabilities of Privileged Access, LP (“Privileged Access”) for an unsecured note payable of $2.0 million (the “PA Transaction”). Prior to the purchase, Privileged Access was the tenant under a 12-year lease with the Company for 82 Properties that terminated upon the closing of our acquisition. The $2.0 million unsecured note payable matures on August 14, 2010 and accrues interest at 10 percent per annum. See Note 12 in the Notes to Consolidated Financial Statements contained in this Form 10-K.
 
We believe that opportunities for property acquisitions are still available. Increasing acceptability of and demand for a lifestyle that includes Site Set homes and RVs as well as continued constraints on development of new properties continue to add to their attractiveness as an investment. We believe we have a competitive advantage in the acquisition of additional properties due to our experienced management, significant presence in major real estate markets and substantial capital resources. We are actively seeking to acquire additional properties and are engaged in various stages of negotiations relating to the possible acquisition of a number of properties.
 
We anticipate that new acquisitions will generally be located in the United States, although we may consider other geographic locations provided they meet our acquisition criteria. We utilize market information systems to identify and evaluate acquisition opportunities, including a market database to review the primary economic indicators of the various locations in which we expect to expand our operations. Acquisitions will be financed from the most appropriate sources of capital, which may include undistributed funds from operations, issuance of additional equity securities, sales of investments, collateralized and uncollateralized borrowings and issuance of debt securities. In addition, the Company may acquire properties in transactions that include the issuance of limited partnership interests in the Operating Partnership (“Units”) as consideration for the acquired properties. We believe that an ownership structure that includes the Operating Partnership will permit us to acquire additional properties in transactions that may defer all or a portion of the sellers’ tax consequences. When evaluating potential acquisitions, we consider such factors as:
 
  •  The replacement cost of the property including land values, entitlements and zoning;
 
  •  The geographic area and type of the property;
 
  •  The location, construction quality, condition and design of the property;
 
  •  The current and projected cash flow of the property and the ability to increase cash flow;
 
  •  The potential for capital appreciation of the property;
 
  •  The terms of tenant leases or usage rights, including the potential for rent increases;
 
  •  The potential for economic growth and the tax and regulatory environment of the community in which the property is located;
 
  •  The potential for expansion of the physical layout of the property and the number of sites;
 
  •  The occupancy and demand by customers for properties of a similar type in the vicinity and the customers’ profile;
 
  •  The prospects for liquidity through sale, financing or refinancing of the property; and
 
  •  The competition from existing properties and the potential for the construction of new properties in the area.
 
When evaluating potential dispositions, we consider such factors as:
 
  •  The ability to sell the Property at a price that we believe will provide an appropriate return for our stockholders;


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  •  Our desire to exit certain non-core markets and recycle the capital into core markets; and
 
  •  Whether the Property meets our current investment criteria.
 
When investing capital we consider all potential uses of the capital including returning capital to our stockholders. Our Board of Directors continues to review the conditions under which we will repurchase our stock. These conditions include, but are not limited to, market price, balance sheet flexibility, other opportunities and capital requirements. On January 16, 2004, we paid a special dividend of $8.00 per share using proceeds from a recapitalization.
 
Property Expansions
 
Several of our Properties have available land for expanding the number of sites available to be utilized by our customers. Development of these sites (“Expansion Sites”) is evaluated based on the following: local market conditions; ability to subdivide; accessibility through the Property or externally; infrastructure needs including utility needs and access as well as additional common area amenities; zoning and entitlement; costs; topography; and ability to market new sites. When justified, development of Expansion Sites allows us to leverage existing facilities and amenities to increase the income generated from the Properties. Where appropriate, facilities and amenities may be upgraded or added to certain Properties to make those Properties more attractive in their markets. Our acquisition philosophy has included the desire to own Properties with potential Expansion Site development. Approximately 83 of our Properties have expansion potential, with approximately 5,600 acres available for expansion.
 
Leases or Usage Rights
 
At our Properties, a typical lease entered into between the owner of a home and the Company for the rental of a site is for a month-to-month or year-to-year term, renewable upon the consent of both parties or, in some instances, as provided by statute. These leases are cancelable, depending on applicable law, for non-payment of rent, violation of Property rules and regulations or other specified defaults. Non-cancelable long-term leases, with remaining terms ranging up to ten years, are in effect at certain sites within 39 of the Properties. Some of these leases are subject to rental rate increases based on the Consumer Price Index (“CPI”), in some instances taking into consideration certain floors and ceilings and allowing for pass-throughs of certain items such as real estate taxes, utility expenses and capital expenditures. Generally, market rate adjustments are made on an annual basis. At Properties zoned for RV use, long-term customers typically enter into rental agreements and many typically prepay for their stay. Many resort customers will also leave deposits to reserve a site for the following year. Generally these customers cannot live full time on the Property. At resort Properties designated for use by customers who have purchased a right-to-use or a membership contract, the contract generally grants the customer access to designated resort Properties on a continuous basis of up to 14 days. The customer typically makes a nonrefundable upfront payment and annual dues payments are required to renew the contract. The annual dues increase is provided for in the contract and is generally based on a percentage of CPI. Approximately 30 percent of the current customers dues do not increase on an annual basis as their dues were frozen in accordance with the terms of their contract, generally because the customer is over 61 years old.
 
Regulations and Insurance
 
General.  Our Properties are subject to various laws, ordinances and regulations, including regulations relating to recreational facilities such as swimming pools, clubhouses and other common areas, regulations relating to providing utility services — such as electricity — to our customers, and regulations relating to operating water and wastewater treatment facilities at certain of our Properties. We believe that each Property has the necessary permits and approvals to operate.
 
Rent Control Legislation.  At certain of our Properties, state and local rent control laws, principally in California, limit our ability to increase rents and to recover increases in operating expenses and the costs of capital improvements. Enactment of such laws has been considered from time to time in other jurisdictions. We presently expect to continue to maintain Properties, and may purchase additional properties, in markets that are either subject to rent control or in which rent-limiting legislation exists or may be enacted. For example, Florida


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has enacted a law that generally provides that rental increases must be reasonable. Also, certain jurisdictions in California in which we own Properties limit rent increases to changes in the CPI or some percentage thereof. As part of our effort to realize the value of our Properties subject to restrictive regulation, we have initiated lawsuits against several municipalities imposing such regulation in an attempt to balance the interests of our stockholders with the interests of our customers (see Item 3 — Legal Proceedings). Further, at certain of our Properties primarily used as membership campgrounds, some state statutes limit our ability to close the Property unless we make a reasonable substitute property available for the member’s use. Many states also have consumer protection laws regulating right-to-use or campground membership sales and the financing of such sales. Some states have laws requiring the Company to register with a state agency and obtain a permit to market (see Item 1A. Risk Factors).
 
Insurance.  The Properties are covered against fire, flood, property damage, earthquake, windstorm and business interruption by insurance policies containing various deductible requirements and coverage limits. Recoverable costs are classified in other assets as incurred. Insurance proceeds are applied against the asset when received. Recoverable costs relating to capital items are treated in accordance with the Company’s capitalization policy. The book value of the original capital item is written off once the value of the impaired asset has been determined. Insurance proceeds relating to capital costs are recorded as income in the period they are received.
 
Our current property and casualty insurance policies, which we plan to renew, expire on March 31, 2009. We have a $100 million property insurance program. The California Earthquake sublimit is $25 million and the policy deductibles range from $100,000 to five percent of insurable values specifically for named storms, Florida wind, and earthquakes. A deductible indicates ELS’ maximum exposure in event of a loss within policy limit.
 
INDUSTRY
 
We believe that modern properties similar to ours provide an opportunity for increased cash flows and appreciation in value. These may be achieved through increases in occupancy rates and rents, as well as expense controls, expansion of existing Properties and opportunistic acquisitions, for the following reasons:
 
  •  Barriers to Entry:  We believe that the supply of new properties in locations targeted by the Company will be constrained due to barriers to entry. The most significant barrier has been the difficulty of securing zoning from local authorities. This has been the result of (i) the public’s historically poor perception of manufactured housing, and (ii) the fact that properties generate less tax revenue because the homes are treated as personal property (a benefit to the homeowner) rather than real property. Another factor that creates substantial barriers to entry is the length of time between investment in a property’s development and the attainment of stabilized occupancy and the generation of revenues. The initial development of the infrastructure may take up to two or three years. Once a property is ready for occupancy, it may be difficult to attract customers to an empty property. Substantial occupancy levels may take several years to achieve.
 
  •  Industry Consolidation:  According to various industry reports, there are approximately 65,000 properties in the United States, and approximately 10% or approximately 6,000 of the properties have more than 200 sites and would be considered investment-grade. We believe that this relatively high degree of fragmentation provides us, as a national organization with experienced management and substantial financial resources, the opportunity to purchase additional properties.
 
  •  Customer Base:  We believe that properties tend to achieve and maintain a stable rate of occupancy due to the following factors: (i) customers typically own their own homes, (ii) properties tend to foster a sense of community as a result of amenities such as clubhouses and recreational and social activities, (iii) since moving a Site Set home from one property to another involves substantial cost and effort, customers often sell their home in-place (similar to site-built residential housing) with no interruption of rental payments to us.
 
  •  Lifestyle Choice:  According to the Recreational Vehicle Industry Association, nearly 1 in 10 U.S. vehicle-owning households owns an RV. The 78 million people born from 1946 to 1964 or “baby boomers”


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  make up the fastest growing segment of this market. Every day 11,000 Americans turn 50 according to U.S. Census figures. We believe that this population segment, seeking an active lifestyle, will provide opportunities for future cash flow growth for the Company. Current RV owners, once finished with the more active RV lifestyle, will often seek more permanent retirement or vacation establishments. The Site Set housing choice has become an increasingly popular housing alternative for retirement, second-home, and “empty-nest” living. According to a Fannie Mae survey, the baby-boom generation will constitute 18% of the U.S. population within the next 30 years and more than 32 million people will reach age 55 within the next ten years. Among those individuals who are nearing retirement (age 40 to 54), approximately 33% plan on moving upon retirement.
 
We believe that the housing choices in our Properties are especially attractive to such individuals throughout this lifestyle cycle. Our Properties offer an appealing amenity package, close proximity to local services, social activities, low maintenance and a secure environment. In fact, many of our Properties allow for this cycle to occur within a single Property.
 
  •  Construction Quality:  Since 1976, all factory built housing has been required to meet stringent federal standards, resulting in significant increases in quality. The Department of Housing and Urban Development’s (“HUD”) standards for Site Set housing construction quality are the only federally regulated standards governing housing quality of any type in the United States. Site Set homes produced since 1976 have received a “red and silver” government seal certifying that they were built in compliance with the federal code. The code regulates Site Set home design and construction, strength and durability, fire resistance and energy efficiency, and the installation and performance of heating, plumbing, air conditioning, thermal and electrical systems. In newer homes, top grade lumber and dry wall materials are common. Also, manufacturers are required to follow the same fire codes as builders of site-built structures. In addition, although Resort Cottages do not come under the same regulation, many of the manufacturers of Site Set homes also produce Resort Cottages with many of the same quality standards.
 
  •  Comparability to Site-Built Homes:  The Site Set housing industry has experienced a trend towards multi-section homes. Many modern Site Set homes are longer (up to 80 feet, compared to 50 feet in the 1960’s) and wider than earlier models. Many such homes have nine-foot ceilings or vaulted ceilings, fireplaces and as many as four bedrooms, and closely resemble single-family ranch style site-built homes.
 
  •  Second Home Demographics:  According to 2008 National Association of Realtors (“NAR”) reports, sales of second homes in 2007 accounted for 33% of residential transactions, or 2.09 million second-home sales in 2007. There were approximately 7.5 million vacation homes in 2007. The typical vacation-home buyer is 46 years old and earned $99,100 in 2007. Approximately 57% of vacation home-owners prefer to be near an ocean, river or lake; 38% close to boating activities; 32% close to hunting or fishing activities; and 17% close to winter recreations. In looking ahead, NAR believes that baby boomers are still in their peak earning years, and the leading edge of their generation is approaching retirement. As they continue to have the financial wherewithal to purchase second homes as a vacation property, investment opportunity, or perhaps as a retirement retreat, those baby boomers will continue to drive the market for second-homes. We believe it is likely that over the next decade we will continue to see historically high levels of second home sales and resort homes and cottages in our Properties will also continue to provide a viable second home alternative to site-built homes.
 
We are also monitoring the performance of the following related industries that may limit our long-term or short-term opportunities.
 
  •  Shipments — According to statistics compiled by the U.S. Census Bureau, shipments of new manufactured homes have been declining since 2005. Estimated 2008 shipments of new manufactured homes decreased over 14% to 81,900 units as compared to 2007 shipments of 95,700 units. The decline for 2007 as compared to 2006 was over 18 percent. According to the Recreational Vehicle Industry Association (“RVIA”), shipments of RV’s declined 32.9% in 2008 to 237,000 units as compared to 2007 and declined 52% in the last six months of 2008 as compared to the last six months of 2008. Industry experts have predicted that 2009 RV shipments will decline again in 2009 over 21 percent to 186,500.


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  •  Sales — Sales of RV’s declined over 24% for the first ten months of 2008, as compared to the first ten months of 2007. 309,000 were sold during the year ended December 31, 2007, representing a decline of almost 21% over the prior year. RVIA has indicated that credit restrictions are causing RV buyers to delay purchases and RV dealers to keep inventories low and that 2009 sales will be further affected by falling employment and continued declines in household wealth and home prices.
 
  •  Availability of financing — The current credit crisis has made it difficult for manufactured home and RV manufacturers to obtain floor plan financing and for potential customers to obtain loans for manufactured home or RV purchases. According to RVIA, both consumer loans and dealer floor plan loans were recently included in the Term Asset-Backed Securities Loan Facility (“TALF”) program created by the US Federal Reserve.
 
Please see our financial statements and related notes contained in this Form 10-K for more information.
 
Available Information
 
We file reports electronically with the Securities and Exchange Commission (“SEC”). The public may read and copy any materials we file with the SEC at the SEC’s Public Reference Room at 100 F Street, NE, Washington, DC 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains an Internet site that contains reports, proxy information and statements, and other information regarding issuers that file electronically with the SEC at http://www.sec.gov. We maintain an Internet site with information about the Company and hyperlinks to our filings with the SEC at http://www.equitylifestyle.com, free of charge. Requests for copies of our filings with the SEC and other investor inquiries should be directed to:
 
Investor Relations Department
Equity LifeStyle Properties, Inc.
Two North Riverside Plaza
Chicago, Illinois 60606
Phone: 1-800-247-5279
e-mail: investor_relations@mhchomes.com
 
Item 1A.   Risk Factors
 
Our Performance and Common Stock Value Are Subject to Risks Associated With the Real Estate Industry.
 
Adverse Economic Conditions and Other Factors Could Adversely Affect the Value of Our Properties and Our Cash Flow.  Several factors may adversely affect the economic performance and value of our Properties. These factors include:
 
  •  changes in the national, regional and local economic climate;
 
  •  local conditions such as an oversupply of lifestyle-oriented properties or a reduction in demand for lifestyle-oriented properties in the area, the attractiveness of our Properties to customers, competition from manufactured home communities and other lifestyle-oriented properties and alternative forms of housing (such as apartment buildings and site-built single family homes);
 
  •  the ability of manufactured home and RV manufacturers to adapt to changes in the economic climate and the availability of units from these manufacturers;
 
  •  the ability of our potential customers to sell their existing site-built residence in order to purchase a resort home or cottage in our properties and heightened price sensitivity for seasonal and second homebuyers;
 
  •  the ability of our potential customers to obtain financing on the purchase of a resort home, resort cottage or RV;
 
  •  availability and price of gasoline, especially for our transient customers;


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  •  our ability to collect rent, annual payments and principal and interest from customers and pay or control maintenance, insurance and other operating costs (including real estate taxes), which could increase over time;
 
  •  the failure of our assets to generate income sufficient to pay our expenses, service our debt and maintain our Properties, which may adversely affect our ability to make expected distributions to our stockholders;
 
  •  our inability to meet mortgage payments on any Property that is mortgaged, in which case the lender could foreclose on the mortgage and take the Property;
 
  •  interest rate levels and the availability of financing, which may adversely affect our financial condition;
 
  •  changes in laws and governmental regulations (including rent control laws and regulations governing usage, zoning and taxes), which may adversely affect our financial condition;
 
  •  poor weather, especially on holiday weekends in the summer, could reduce the economic performance of our Northern resort Properties; and
 
  •  our ability to sell new or upgraded right-to-use contracts and to retain customers who have previously purchased a right-to-use contract.
 
New Acquisitions May Fail to Perform as Expected and Competition for Acquisitions May Result in Increased Prices for Properties.  We intend to continue to acquire properties. Newly acquired Properties may fail to perform as expected. We may underestimate the costs necessary to bring an acquired property up to standards established for its intended market position. Difficulties in integrating acquisitions may prove costly or time-consuming and could divert management attention. Additionally, we expect that other real estate investors with significant capital will compete with us for attractive investment opportunities. These competitors include publicly traded REITs, private REITs and other types of investors. Such competition increases prices for properties. We expect to acquire properties with cash from secured or unsecured financings, proceeds from offerings of equity or debt, undistributed funds from operations and sales of investments. We may not be in a position or have the opportunity in the future to make suitable property acquisitions on favorable terms.
 
Because Real Estate Investments Are Illiquid, We May Not be Able to Sell Properties When Appropriate.  Real estate investments generally cannot be sold quickly. We may not be able to vary our portfolio promptly in response to economic or other conditions, forcing us to accept lower than market value. This inability to respond promptly to changes in the performance of our investments could adversely affect our financial condition and ability to service debt and make distributions to our stockholders.
 
Some Potential Losses Are Not Covered by Insurance.  We carry comprehensive insurance coverage for losses resulting from property damage, liability claims and business interruption on all of our Properties. We believe that the policy specifications and coverage limits of these policies should be adequate and appropriate. There are, however, certain types of losses, such as lease and other contract claims that generally are not insured. Should an uninsured loss or a loss in excess of coverage limits occur, we could lose all or a portion of the capital we have invested in a Property, as well as the anticipated future revenue from the Property. In such an event, we might nevertheless remain obligated for any mortgage debt or other financial obligations related to the Property.
 
Our current property and casualty insurance policies, which we plan to renew, expire on March 31, 2009. We have a $100 million property insurance program. The California Earthquake sublimit is $25 million and the policy deductibles range from $100,000 to five percent of insurable values specifically for named storms, Florida wind, and earthquakes. A deductible indicates ELS’ maximum exposure in event of a loss within policy limit.
 
There can be no assurance that the actions of the U.S. government, Federal Reserve and other governmental and regulatory bodies for the purpose of stabilizing the financial markets, or market response to those actions, will achieve the intended effect, and our business may not benefit from and may be adversely impacted by these actions and further government or market developments could adversely impact us.  Since mid-2007, and particularly during the second half of 2008, the financial services industry and the securities markets generally were materially and adversely affected by significant declines in the values of nearly all asset classes and by a serious lack of liquidity. This was initially triggered by declines in the values of subprime mortgages, but spread


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to all mortgage and real estate asset classes, to leveraged bank loans and to nearly all asset classes, including equities. The global markets have been characterized by substantially increased volatility and short-selling and an overall loss of investor confidence, initially in financial institutions, but more recently in companies in a number of other industries and in the broader markets. The decline in asset values has caused increases in margin calls for investors, requirements that derivatives counterparties post additional collateral and redemptions by mutual and hedge fund investors, all of which have increased the downward pressure on asset values and outflows of client funds across the financial services industry. In addition, the increased redemptions and unavailability of credit have required hedge funds and others to rapidly reduce leverage, which has increased volatility and further contributed to the decline in asset values.
 
In response to the recent unprecedented financial issues affecting the banking system and financial markets and going concern threats to investment banks and other financial institutions, the Emergency Economic Stabilization Act of 2008 (the “EESA”), was signed into law on October 3, 2008. The EESA provides the U.S. Secretary of Treasury with the authority to establish a Troubled Asset Relief Program (“TARP”), to purchase from financial institutions up to $700 billion of residential or commercial mortgages and any securities, obligations, or other instruments that are based on, or related to, such mortgages, that in each case was originated or issued on or before March 14, 2008. EESA also provides for a program that would allow companies to insure their troubled assets. As of February 19, 2009, the U.S. Treasury had announced the establishment of the following programs under TARP: the Capital Purchase Program (“CPP”), the Targeted Investment Program (“TIP”), the Systemically Significant Failing Institutions Program (“SSFIP”), the Asset Guarantee Program (“AGP”), the Auto Industry Financing Program (“AIFP”), and the Homeowner Affordability and Stability Plan (“HASP”) which is partially financed by TARP. On February 17, 2009, President Obama signed the American Recovery and Reinvestment Act of 2009 (“ARRA”), a $787 billion stimulus bill for the purpose of stabilizing the economy by creating jobs, among other things.
 
These can be no assurance that the EESA, TARP or other programs will have a beneficial impact on the financial markets, including current extreme levels of volatility. In addition, the U.S. Government, Federal Reserve and other governmental and regulatory bodies have taken or are considering taking other actions to address the financial crisis. We cannot predict whether or when such actions may occur or what impact, if any, such actions could have on our business, results of operations and financial condition.
 
Adverse changes in general economic conditions may adversely affected our business.
 
Our success is dependent upon economic conditions in the U.S. generally, and in the geographic areas in which a substantial number of our Properties are located. The recent adverse changes in national economic conditions and in the economic conditions of the regions in which we conduct substantial business may have an adverse effect on the real estate values of our Properties and our financial performance and the market price of our common stock.
 
In a recession or under other adverse economic conditions like the current credit crisis, non-earning assets and write-downs are likely to increase as debtors fail to meet their payment obligations. Although we maintain reserves for credit losses and an allowance for doubtful accounts in amounts that we believe should be sufficient to provide adequate protection against potential write-downs in our portfolio, these amounts could prove to be insufficient.
 
Campground Membership Properties Laws and Regulations Could Adversely Affect the Value of Our Properties and Our Cash Flow.
 
Many of the states in which the Company does business have laws regulating right-to-use or campground membership sales. These laws generally require comprehensive disclosure to prospective purchasers, and give purchasers the right to rescind their purchase generally between three-to-five days after the date of sale. Some states have laws requiring the Company to register with a state agency and obtain a permit to market. The Company is subject to changes, from time to time, in the application or interpretation of such laws that can affect its business or the rights of its members.


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In some states, including California, Oregon and Washington, laws place limitations on the ability of the owner of a campground property to close the property unless the customers at the property receive access to a comparable property. The impact of the rights of customers under these laws is uncertain and could adversely affect the availability or timing of sale opportunities or the ability of the Company to realize recoveries from property sales.
 
The government authorities regulating the Company’s activities have broad discretionary power to enforce and interpret the statutes and regulations that they administer, including the power to enjoin or suspend sales activities, require or restrict construction of additional facilities and revoke licenses and permits relating to business activities. The Company monitors its sales and marketing programs and debt collection activities to control practices that might violate consumer protection laws and regulations or give rise to consumer complaints.
 
Certain consumer rights and defenses that vary from jurisdiction to jurisdiction may affect the Company’s portfolio of contracts receivable. Examples of such laws include state and federal consumer credit and truth-in-lending laws requiring the disclosure of finance charges, and usury and retail installment sales laws regulating permissible finance charges.
 
In certain states, as a result of government regulations and provisions in certain of the right-to-use or campground membership agreements, the Company is prohibited from selling more than ten memberships per site. At the present time, these restrictions do not preclude the Company from selling memberships in any state. However, these restrictions may limit the Company’s ability to utilize properties for public usage and/or the Company’s ability to convert sites to more profitable or predictable uses, such as annual rentals.
 
Debt Financing, Financial Covenants and Degree of Leverage Could Adversely Affect Our Economic Performance.
 
Scheduled Debt Payments Could Adversely Affect Our Financial Condition.  Our business is subject to risks normally associated with debt financing. The total principal amount of our outstanding indebtedness was approximately $1.7 billion as of December 31, 2008. Our substantial indebtedness and the cash flow associated with serving our indebtedness could have important consequences, including the risks that:
 
  •  our cash flow could be insufficient to pay distributions at expected levels and meet required payments of principal and interest;
 
  •  we will be required to use a substantial portion of our cash flow from operations to pay our indebtedness, thereby reducing the availability of our cash flow to fund the implementation of our business strategy, acquisitions, capital expenditures and other general corporate purposes;
 
  •  our debt service obligations could limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate;
 
  •  we may not be able to refinance existing indebtedness (which in virtually all cases requires substantial principal payments at maturity) and, if we can, the terms of such refinancing might not be as favorable as the terms of existing indebtedness;
 
  •  if principal payments due at maturity cannot be refinanced, extended or paid with proceeds of other capital transactions, such as new equity capital, our cash flow will not be sufficient in all years to repay all maturing debt; and
 
  •  if prevailing interest rates or other factors at the time of refinancing (such as the possible reluctance of lenders to make commercial real estate loans) result in higher interest rates, increased interest expense would adversely affect cash flow and our ability to service debt and make distributions to stockholders.
 
Ability to obtain mortgage financing or to refinance maturing mortgages may adversely affect our financial condition.  During 2008, we have received financing proceeds from Fannie Mae secured by mortgages on individual manufactured home Properties. The terms of the Fannie Mae financings have been relatively attractive as compared to other potential lenders. If financing proceeds are no longer available from Fannie Mae


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for any reason or if Fannie Mae terms are no longer attractive, it may adversely affect cash flow and our ability to service debt and make distributions to stockholders.
 
Financial Covenants Could Adversely Affect Our Financial Condition.  If a Property is mortgaged to secure payment of indebtedness and we are unable to meet mortgage payments, the mortgagee could foreclose on the Property, resulting in loss of income and asset value. The mortgages on our Properties contain customary negative covenants, which among other things, limit our ability, without the prior consent of the lender, to further mortgage the Property and to discontinue insurance coverage. In addition, our credit facilities contain certain customary restrictions, requirements and other limitations on our ability to incur indebtedness, including total debt to assets ratios, debt service coverage ratios and minimum ratios of unencumbered assets to unsecured debt. Foreclosure on mortgaged Properties or an inability to refinance existing indebtedness would likely have a negative impact on our financial condition and results of operations.
 
Our Degree of Leverage Could Limit Our Ability to Obtain Additional Financing.  Our debt to market capitalization ratio (total debt as a percentage of total debt plus the market value of the outstanding common stock and Units held by parties other than the Company) is approximately 59% as of December 31, 2008. The degree of leverage could have important consequences to stockholders, including an adverse effect on our ability to obtain additional financing in the future for working capital, capital expenditures, acquisitions, development or other general corporate purposes, and makes us more vulnerable to a downturn in business or the economy generally.
 
We Depend on Our Subsidiaries’ Dividends and Distributions.
 
Substantially all of our assets are indirectly held through the Operating Partnership. As a result, we have no source of operating cash flow other than from distributions from the Operating Partnership. Our ability to pay dividends to holders of common stock depends on the Operating Partnership’s ability first to satisfy its obligations to its creditors and make distributions payable to third party holders of its preferred Units and then to make distributions to MHC Trust and common Unit holders. Similarly, MHC Trust must satisfy its obligations to its creditors and preferred stockholders before making common stock distributions to us.
 
Stockholders’ Ability to Effect Changes of Control of the Company is Limited.
 
Provisions of Our Charter and Bylaws Could Inhibit Changes of Control.  Certain provisions of our charter and bylaws may delay or prevent a change of control of the Company or other transactions that could provide our stockholders with a premium over the then-prevailing market price of their common stock or which might otherwise be in the best interest of our stockholders. These include the Ownership Limit described below. Also, any future series of preferred stock may have certain voting provisions that could delay or prevent a change of control or other transaction that might involve a premium price or otherwise be beneficial to our stockholders.
 
Maryland Law Imposes Certain Limitations on Changes of Control.  Certain provisions of Maryland law prohibit “business combinations” (including certain issuances of equity securities) with any person who beneficially owns ten percent or more of the voting power of outstanding common stock, or with an affiliate of the Company who, at any time within the two-year period prior to the date in question, was the owner of ten percent or more of the voting power of the outstanding voting stock (an “Interested Stockholder”), or with an affiliate of an Interested Stockholder. These prohibitions last for five years after the most recent date on which the Interested Stockholder became an Interested Stockholder. After the five-year period, a business combination with an Interested Stockholder must be approved by two super-majority stockholder votes unless, among other conditions, our common stockholders receive a minimum price for their shares and the consideration is received in cash or in the same form as previously paid by the Interested Stockholder for its shares of common stock. The Board of Directors has exempted from these provisions under the Maryland law any business combination with Samuel Zell, who is the Chairman of the Board of the Company, certain holders of Units who received them at the time of our initial public offering, the General Motors Hourly Rate Employees Pension Trust and the General Motors Salaried Employees Pension Trust, and our officers who acquired common stock at the time we were formed and each and every affiliate of theirs.


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We Have a Stock Ownership Limit for REIT Tax Purposes.  To remain qualified as a REIT for U.S. federal income tax purposes, not more than 50% in value of our outstanding shares of capital stock may be owned, directly or indirectly, by five or fewer individuals (as defined in the federal income tax laws applicable to REITs) at any time during the last half of any taxable year. To facilitate maintenance of our REIT qualification, our charter, subject to certain exceptions, prohibits Beneficial Ownership (as defined in our charter) by any single stockholder of more than 5% (in value or number of shares, whichever is more restrictive) of our outstanding capital stock. We refer to this as the “Ownership Limit.” Within certain limits, our charter permits the Board of Directors to increase the Ownership Limit with respect to any class or series of stock. The Board of Directors, upon receipt of a ruling from the IRS, opinion of counsel, or other evidence satisfactory to the Board of Directors and upon fifteen days prior written notice of a proposed transfer which, if consummated, would result in the transferee owning shares in excess of the Ownership Limit, and upon such other conditions as the Board of Directors may direct, may exempt a stockholder from the Ownership Limit. Absent any such exemption, capital stock acquired or held in violation of the Ownership Limit will be transferred by operation of law to us as trustee for the benefit of the person to whom such capital stock is ultimately transferred, and the stockholder’s rights to distributions and to vote would terminate. Such stockholder would be entitled to receive, from the proceeds of any subsequent sale of the capital stock transferred to us as trustee, the lesser of (i) the price paid for the capital stock or, if the owner did not pay for the capital stock (for example, in the case of a gift, devise of other such transaction), the market price of the capital stock on the date of the event causing the capital stock to be transferred to us as trustee or (ii) the amount realized from such sale. A transfer of capital stock may be void if it causes a person to violate the Ownership Limit. The Ownership Limit could delay or prevent a change in control of the Company and, therefore, could adversely affect our stockholders’ ability to realize a premium over the then-prevailing market price for their common stock.
 
Conflicts of Interest Could Influence the Company’s Decisions.
 
Certain Stockholders Could Exercise Influence in a Manner Inconsistent With the Stockholders’ Best Interests. As of December 31, 2008, Mr. Samuel Zell and certain affiliated holders beneficially owned approximately 14.2% of our outstanding common stock (in each case including common stock issuable upon the exercise of stock options and the exchange of Units). Mr. Zell is the chairman of the Company’s Board of Directors. Accordingly, Mr. Zell has significant influence on our management and operation. Such influence could be exercised in a manner that is inconsistent with the interests of other stockholders.
 
Mr. Zell and His Affiliates Continue to be Involved in Other Investment Activities.  Mr. Zell and his affiliates have a broad and varied range of investment interests, including interests in other real estate investment companies involved in other forms of housing, including multifamily housing. Mr. Zell and his affiliates may acquire interests in other companies. Mr. Zell may not be able to control whether any such company competes with the Company. Consequently, Mr. Zell’s continued involvement in other investment activities could result in competition to the Company as well as management decisions, which might not reflect the interests of our stockholders.
 
Members of Management May Have a Conflict of Interest Over Whether To Enforce Terms of Mr. McAdams’s Employment and Noncompetition Agreement.  Mr. McAdams is our President and has entered into an employment and noncompetition agreement with us. For the most part these restrictions apply to him both during his employment and for two years thereafter. Mr. McAdams is also prohibited from otherwise disrupting or interfering with our business through the solicitation of our employees or clients or otherwise. To the extent that we choose to enforce our rights under any of these agreements, we may determine to pursue available remedies, such as actions for damages or injunctive relief, less vigorously than we otherwise might because of our desire to maintain our ongoing relationship with Mr. McAdams. Additionally, the non-competition provisions of his agreement, despite being limited in scope and duration, could be difficult to enforce, or may be subject to limited enforcement, should litigation arise over it in the future. See Note 12 in the Notes to Consolidated Financial Statements contained in this Form 10-K.


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Risk of Eminent Domain and Tenant Litigation.
 
We own Properties in certain areas of the country where real estate values have increased faster than rental rates in our Properties either because of locally imposed rent control or long term leases. In such areas, we have learned that certain local government entities have investigated the possibility of seeking to take our Properties by eminent domain at values below the value of the underlying land. While no such eminent domain proceeding has been commenced, and we would exercise all of our rights in connection with any such proceeding, successful condemnation proceedings by municipalities could adversely affect our financial condition. Moreover, certain of our Properties located in California are subject to rent control ordinances, some of which not only severely restrict ongoing rent increases but also prohibit us from increasing rents upon turnover. Such regulation allows customers to sell their homes for a premium representing the value of the future discounted rent-controlled rents. As part of our effort to realize the value of our Properties subject to rent control, we have initiated lawsuits against several municipalities in California. In response to our efforts, tenant groups have filed lawsuits against us seeking not only to limit rent increases, but to be awarded large damage awards. If we are unsuccessful in our efforts to challenge rent control ordinances, it is likely that we will not be able to charge rents that reflect the intrinsic value of the affected Properties. Finally, tenant groups in non-rent controlled markets have also attempted to use litigation as a means of protecting themselves from rent increases reflecting the rental value of the affected Properties. An unfavorable outcome in the tenant group lawsuits could have an adverse impact on our financial condition.
 
Environmental and Utility-Related Problems Are Possible and Can be Costly.
 
Federal, state and local laws and regulations relating to the protection of the environment may require a current or previous owner or operator of real estate to investigate and clean up hazardous or toxic substances or petroleum product releases at such property. The owner or operator may have to pay a governmental entity or third parties for property damage and for investigation and clean-up costs incurred by such parties in connection with the contamination. Such laws typically impose clean-up responsibility and liability without regard to whether the owner or operator knew of or caused the presence of the contaminants. Even if more than one person may have been responsible for the contamination, each person covered by the environmental laws may be held responsible for all of the clean-up costs incurred. In addition, third parties may sue the owner or operator of a site for damages and costs resulting from environmental contamination emanating from that site.
 
Environmental laws also govern the presence, maintenance and removal of asbestos. Such laws require that owners or operators of property containing asbestos properly manage and maintain the asbestos, that they notify and train those who may come into contact with asbestos and that they undertake special precautions, including removal or other abatement, if asbestos would be disturbed during renovation or demolition of a building. Such laws may impose fines and penalties on real property owners or operators who fail to comply with these requirements and may allow third parties to seek recovery from owners or operators for personal injury associated with exposure to asbestos fibers.
 
Utility-related laws and regulations also govern the provision of utility services and operations of water and wastewater treatment facilities. Such laws regulate, for example, how and to what extent owners or operators of property can charge renters for provision of, for example, electricity, and whether and to what extent such utility services can be charged separately from the base rent. Such laws also regulate the operations and performance of water treatment facilities and wastewater treatment facilities. Such laws may impose fines and penalties on real property owners or operators who fail to comply with these requirements.
 
We Have a Significant Concentration of Properties in Florida and California, and Natural Disasters or Other Catastrophic Events in These or Other States Could Adversely Affect the Value of Our Properties and Our Cash Flow.
 
As of December 31, 2008, we owned or had an ownership interest in 309 Properties located in 28 states and British Columbia, including 86 Properties located in Florida and 48 Properties located in California. The occurrence of a natural disaster or other catastrophic event in any of these areas may cause a sudden decrease in the value of our Properties. While we have obtained insurance policies providing certain coverage against


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damage from fire, flood, property damage, earthquake, wind storm and business interruption, these insurance policies contain coverage limits, limits on covered property and various deductible amounts that the Company must pay before insurance proceeds are available. Such insurance may therefore be insufficient to restore our economic position with respect to damage or destruction to our Properties caused by such occurrences. Moreover, each of these coverages must be renewed every year and there is the possibility that all or some of the coverages may not be available at a reasonable cost. In addition, in the event of such natural disaster or other catastrophic event, the process of obtaining reimbursement for covered losses, including the lag between expenditures incurred by us and reimbursements received from the insurance providers, could adversely affect our economic performance.
 
Market Interest Rates May Have an Effect on the Value of Our Common Stock.
 
One of the factors that investors consider important in deciding whether to buy or sell shares of a REIT is the distribution rates with respect to such shares (as a percentage of the price of such shares) relative to market interest rates. If market interest rates go up, prospective purchasers of REIT shares may expect a higher distribution rate. Higher interest rates would not, however, result in more funds for us to distribute and, in fact, would likely increase our borrowing costs and potentially decrease funds available for distribution. Thus, higher market interest rates could cause the market price of our publicly traded securities to go down.
 
We Are Dependent on External Sources of Capital.
 
To qualify as a REIT, we must distribute to our stockholders each year at least 90% of our REIT taxable income (determined without regard to the deduction for dividends paid and excluding any net capital gain). In addition, we intend to distribute all or substantially all of our net income so that we will generally not be subject to U.S. federal income tax on our earnings. Because of these distribution requirements, it is not likely that we will be able to fund all future capital needs, including for acquisitions, from income from operations. We therefore will have to rely on third-party sources of debt and equity capital financing, which may or may not be available on favorable terms or at all. Our access to third-party sources of capital depends on a number of things, including conditions in the capital markets generally and the market’s perception of our growth potential and our current and potential future earnings. As a result of the current credit crisis it may be difficult for us to meet one or more of the requirements for qualification as a REIT, including but not limited to our distribution requirement. Moreover, additional equity offerings may result in substantial dilution of stockholders’ interests, and additional debt financing may substantially increase our leverage.
 
Our Qualification as a REIT is Dependent on Compliance With U.S. Federal Income Tax Requirements.
 
We believe we have been organized and operated in a manner so as to qualify for taxation as a REIT, and we intend to continue to operate so as to qualify as a REIT for U.S. federal income tax purposes. Qualification as a REIT for U.S. federal income tax purposes, however, is governed by highly technical and complex provisions of the Code for which there are only limited judicial or administrative interpretations. In connection with certain transactions, we have received, and relied, on advice of counsel as to the impact of such transactions on our qualification as a REIT. Our qualification as a REIT requires analysis of various facts and circumstances that may not be entirely within our control, and we cannot provide any assurance that the Internal Revenue Service (the “IRS”) will agree with our analysis or the analysis of our tax counsel. In particular, the proper federal income tax treatment of right-to-use and membership contracts is uncertain and there is no assurance that the IRS will agree with the Company’s treatment of such contracts. If the IRS were to disagree with our analysis or our tax counsel’s analysis of facts and circumstances, our ability to qualify as a REIT may be adversely affected. These matters can affect our qualification as a REIT. In addition, legislation, new regulations, administrative interpretations or court decisions might significantly change the tax laws with respect to the requirements for qualification as a REIT or the U.S. federal income tax consequences of qualification as a REIT.
 
If, with respect to any taxable year, we fail to maintain our qualification as a REIT (and specified relief provisions under the Code were not applicable to such disqualification), we could not deduct distributions to stockholders in computing our net taxable income and we would be subject to U.S. federal income tax on our net


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taxable income at regular corporate rates. Any U.S. federal income tax payable could include applicable alternative minimum tax. If we had to pay U.S. federal income tax, the amount of money available to distribute to stockholders and pay indebtedness would be reduced for the year or years involved, and we would no longer be required to distribute money to stockholders. In addition, we would also be disqualified from treatment as a REIT for the four taxable years following the year during which qualification was lost, unless we were entitled to relief under the relevant statutory provisions. Although we currently intend to operate in a manner designed to allow us to qualify as a REIT, future economic, market, legal, tax or other considerations may cause us to revoke the REIT election.
 
Interpretation of and Changes to Accounting Policies and Standards Could Adversely Affect Our Reported Financial Results.
 
Our Accounting Policies and Methods Are the Basis on Which We Report Our Financial Condition and Results of Operations, and They May Require Management to Make Estimates About Matters that Are Inherently Uncertain.  Our accounting policies and methods are fundamental to the manner in which we record and report our financial condition and results of operations. Management must exercise judgment in selecting and applying many of these accounting policies and methods in order to ensure that they comply with generally accepted accounting principles and reflect management’s judgment as to the most appropriate manner in which to record and report our financial condition and results of operations. In some cases, management must select the accounting policy or method to apply from two or more alternatives, any of which might be reasonable under the circumstances yet might result in reporting materially different amounts than would have been reported under a different alternative.
 
One policy critical to the presentation of our financial condition and results of operations in 2008 was our policy related to Privileged Access. From April 14, 2006 through August 13, 2008, Privileged Access was our largest tenant and leased 82 resort Properties from us. Effective January 1, 2008, the 100 percent owner of Privileged Access, Mr. Joe McAdams, became our President and we amended and restated the leases for the Properties. Under generally accepted accounting principles, effective January 1, 2008, Mr. McAdams, Privileged Access and the Company were considered related parties. Due to the materiality of the leasing arrangement and the related party nature of the arrangement, the Company analyzed whether the operations of Privileged Access should be consolidated with ours. We determined under FIN 46 that it was not appropriate to consolidate Privileged Access as we did not control Privileged Access and was not the primary beneficiary of Privileged Access. This conclusion required management to make certain judgments. As a result of the complex nature of the arrangements, on February 15, 2008, we submitted a letter to the Office of the Chief Accountant at the SEC describing the relationship and asking for the SEC’s concurrence with our conclusions that we should not consolidate the operations of Privileged Access. The SEC did not object to the Company’s conclusions as described in the letter.
 
Our Accounting Policies for the Sale of Right-To-Use Contracts Will Result in a Substantial Deferral of Revenue in our Financial Results.  Beginning August 14, 2008, the Company began selling right-to-use contracts after the PA Transaction. Customers who purchase right-to-use contracts are generally required to make an upfront nonrefundable payment to the Company. The Company incurs significant selling and marketing expenses to originate the right-to-use contracts, and the majority of expenses must be expensed in the period incurred, while the related sales revenues are generally deferred and recognized over the expected life of the contract which is estimated based upon historical attrition rates. The expected life of a right-to-use contract is currently estimated to be between one and 31 years. As a result, the Company may incur a loss from the sale of right-to-use contracts, build up a substantial deferred sales revenue liability balance, and recognize substantial non-cash revenue in years subsequent to the original sale. This accounting may make it difficult for investors to interpret the financial results from the sale of right-to-use contracts. The Company submitted correspondence to the Office of the Chief Accountant at the SEC describing the right-to-use contracts and subsequently discussed the revenue recognition policy with respect to the contracts with the SEC. The SEC does not object to the Company’s application of Staff Accounting Bulletin 104, Revenue Recognition in Consolidated Financial Statements. Corrected (“SAB 104”) with respect to the deferral of the upfront


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nonrefundable payments received from the sale of right-to-use contracts. See Note 2 (n) in the Notes to Consolidated Financial Statements contained in this Form 10-K for the Company’s revenue recognition policy.
 
Changes in Accounting Standards Could Adversely Affect Our Reported Financial Results.  The bodies that set accounting standards for public companies, including the Financial Accounting Standards Board (“FASB”), the SEC and others, periodically change or revise existing interpretations of the accounting and reporting standards that govern the way that we report our financial condition and results of operations. These changes can be difficult to predict and can materially impact our reported financial results. In some cases, we could be required to apply a new or revised accounting standard, or a revised interpretation of an accounting standard, retroactively, which could have a negative impact on reported results or result in the restatement of our financial statements for prior periods.
 
Item 1B.   Unresolved Staff Comments
 
None.
 
Item 2.   Properties
 
General
 
Our Properties provide attractive amenities and common facilities that create a comfortable and attractive home for our customers, with most offering a clubhouse, a swimming pool, laundry facilities and cable television service. Many also offer additional amenities such as sauna/whirlpool spas, golf courses, tennis, shuffleboard and basketball courts, exercise rooms and various social activities such as concerts. Since most of our customers generally rent our sites on a long-term basis, it is their responsibility to maintain their homes and the surrounding area. It is our role to ensure that customers comply with our Property policies and to provide maintenance of the common areas, facilities and amenities. We hold periodic meetings with our Property management personnel for training and implementation of our strategies. The Properties historically have had, and we believe they will continue to have, low turnover and high occupancy rates.
 
Property Portfolio
 
As of December 31, 2008, we owned or had an ownership interest in a portfolio of 309 Properties located throughout the United States and British Columbia containing 112,074 residential sites.
 
The distribution of our Properties throughout the United States reflects our belief that geographic diversification helps insulate the portfolio from regional economic influences. We intend to target new acquisitions in or near markets where our Properties are located and will also consider acquisitions of Properties outside such markets. Refer to Note 2 (c) of the Notes to Consolidated Financial Statements contained in this Form 10-K.
 
Bay Indies located in Venice, Florida and Viewpoint located in Mesa, Arizona, our two largest properties as determined by property operating revenues, accounted for approximately 2.2% and 2.1%, respectively, of our total property operating revenues for the year ended December 31, 2008.
 
The following table sets forth certain information relating to the Properties we owned as of December 31, 2008, categorized by our major markets (excluding membership campground Properties and Properties owned through joint ventures).
 
                                                                                                     
                                                    New
                         
                                                    Total
                         
                                              Total
    Number
    Annual
    Annual
             
                                  Develo-
          Number
    of Annual
    Site
    Site
    Annual
    Annual
 
                                  Pable
          of Sites
    Sites
    Occupancy
    Occupancy
    Rent
    Rent
 
                            Acres
    Acres
    Expansion
    as of
    as of
    as of
    as of
    as of
    as of
 
Property
  Address   City   State   ZIP     MH/RV     (c)     (d)     Sites(e)     12/31/08     12/31/08     12/31/08     12/31/07     12/31/08     12/31/07  
 
                                                                                                     
Florida
                                                                                                   
                                                                                                     
East Coast:
                                                                                                   
                                                                                                     
Sunshine Key
  38801 Overseas Hwy   Big Pine Key   FL     33043       RV       54                       409       42       100.0 %     100.0 %   $ 10,418     $ 4,505  
                                                                                                     
Carriage Cove
  Five Carriage Cove Way   Daytona Beach   FL     32119       MH       59                       418       418       91.6 %     92.6 %   $ 5,572     $ 5,342  
                                                                                                     
Coquina Crossing
  4536 Coquina Crossing Dr.   Elkton   FL     32033       MH       316       26       145       562       562       91.1 %     88.1 %(b)   $ 5,193     $ 4,912  


18


Table of Contents

                                                                                                     
                                                    New
                         
                                                    Total
                         
                                              Total
    Number
    Annual
    Annual
             
                                  Develo-
          Number
    of Annual
    Site
    Site
    Annual
    Annual
 
                                  Pable
          of Sites
    Sites
    Occupancy
    Occupancy
    Rent
    Rent
 
                            Acres
    Acres
    Expansion
    as of
    as of
    as of
    as of
    as of
    as of
 
Property
  Address   City   State   ZIP     MH/RV     (c)     (d)     Sites(e)     12/31/08     12/31/08     12/31/08     12/31/07     12/31/08     12/31/07  
 
                                                                                                     
Bulow Plantation
  3165 Old Kings Road South   Flagler Beach   FL     32136       MH       323       181       722       276       276       98.6 %     98.6 %(b)   $ 5,326     $ 5,034  
                                                                                                     
Bulow RV
  3345 Old Kings Road South   Flagler Beach   FL     32136       RV       (f )                     352       92       100.0 %     100.0 %   $ 4,944     $ 4,779  
                                                                                                     
Carefree Cove
  3273 N.W. 37th St   Ft. Lauderdale   FL     33309       MH       20                       163       163       93.3 %     92.0 %   $ 6,328     $ 6,047  
                                                                                                     
Park City West
  10550 W. State Road 84   Ft. Lauderdale   FL     33324       MH       60                       363       363       89.3 %     89.5 %   $ 5,734     $ 5,367  
                                                                                                     
Sunshine Holiday
  2802 W. Oakland Park Blvd.   Ft. Lauderdale   FL     33311       MH       32                       269       269       88.1 %     91.8 %   $ 5,835     $ 5,590  
                                                                                                     
Sunshine Holiday RV
  2802 W. Oakland Park Blvd.   Ft. Lauderdale   FL     33311       RV       (f )                     131       44       100.0 %     100.0 %   $ 5,515     $ 5,280  
                                                                                                     
Maralago Cay
  6280 S. Ash Lane   Lantana   FL     33462       MH       102       5               602       602       90.7 %     90.9 %   $ 7,001     $ 6,284  
                                                                                                     
Coral Cay
  2801 NW 62nd Avenue   Margate   FL     33063       MH       121                       819       819       84.7 %     82.2 %   $ 6,028     $ 5,818  
                                                                                                     
Lakewood Village
  3171 Hanson Avenue   Melbourne   FL     32901       MH       68                       349       349       87.1 %     86.8 %   $ 5,664     $ 5,488  
                                                                                                     
Holiday Village
  1335 Fleming Ave Box 228   Ormond Beach   FL     32174       MH       43                       301       301       85.7 %     86.7 %   $ 4,814     $ 4,666  
                                                                                                     
Sunshine Holiday
  1701 North US Hwy 1   Ormond Beach   FL     32174       RV       69                       349       140       100.0 %     100.0 %   $ 4,323     $ 4,069  
                                                                                                     
The Meadows
  2555 PGA Boulevard   Palm Beach Gardens   FL     33410       MH       55                       379       379       85.2 %     83.9 %(b)   $ 6,263     $ 5,936  
                                                                                                     
Breezy Hill RV
  800 NE 48th Street   Pompano Beach   FL     33064       RV       52                       762       358       100.0 %     100.0 %   $ 5,810     $ 5,557  
                                                                                                     
Highland Wood RV
  900 NE 48th street   Pompano Beach   FL     33064       RV       15                       148       11       100.0 %     100.0 %   $ 5,075     $ 5,583  
                                                                                                     
Lighthouse Pointe
  155 Spring Drive   Port Orange   FL     32129       MH       64                       433       433       86.6 %     86.8 %(b)   $ 4,708     $ 4,613  
                                                                                                     
Pickwick
  4500 S. Clyde Morris Blvd   Port Orange   FL     32119       MH       84       4               432       432       100.0 %     99.5 %   $ 4,923     $ 4,686  
                                                                                                     
Indian Oaks
  780 Barnes Boulevard   Rockledge   FL     32955       MH       38                       208       208       100.0 %     100.0 %   $ 4,137     $ 4,014  
                                                                                                     
Countryside
  8775 20th Street   Vero Beach   FL     32966       MH       125                       643       643       89.6 %     89.3 %(b)   $ 5,395     $ 5,117  
                                                                                                     
Heritage Plantation
  1101 Ranch Road   Vero Beach   FL     32966       MH       64                       435       435       83.4 %     82.6 %   $ 5,312     $ 5,185  
                                                                                                     
Holiday Village
  1000 S.W. 27th Avenue   Vero Beach   FL     32968       MH       20                       128       128       28.9 %     35.2 %   $ 4,239     $ 4,233  
                                                                                                     
Sunshine Travel
  9455 108th Avenue   Vero Beach   FL     32967       RV       30       6       48       300       176       100.0 %     100.0 %   $ 4,200     $ 4,058  
                                                                                                     
Central:
                                                                                                   
                                                                                                     
Clerbrook
  20005 U.S. Highway 27   Clermont   FL     34711       RV       288                       1,255       468       100.0 %     100.0 %   $ 4,251     $ 3,574  
                                                                                                     
Lake Magic
  9600 Hwy 192 West   Clermont   FL     34714       RV       69                       471       163       100.0 %     100.0 %   $ 4,018     $ 3,933  
                                                                                                     
Southern Palms
  One Avocado Lane   Eustis   FL     32726       RV       120                       950       373       100.0 %     100.0 %   $ 4,016     $ 3,933  
                                                                                                     
Grand Island
  13310 Sea Breeze Lane   Grand Island   FL     32735       MH       35                       362       362       58.8 %     61.6 %(b)   $ 4,903     $ 4,527  
                                                                                                     
Sherwood Forest
  5302 W. Irlo Bronson Hwy   Kissimmee   FL     34746       MH       124                       767       767       94.3 %     95.0 %(b)   $ 4,847     $ 4,613  
                                                                                                     
Sherwood Forest RV
  5300 W. Irlo Bronson Hwy   Kissimmee   FL     34746       RV       107       43       149       513       143       100.0 %     100.0 %   $ 4,692     $ 4,574  
                                                                                                     
Tropical Palms(g)
  2650 Holiday Trail   Kissimmee   FL     34746       RV       59                       541                                
                                                                                                     
Coachwood Colony
  2610 Dogwood Place   Leesburg   FL     34748       MH       29                       202       202       90.1 %     92.1 %   $ 3,879     $ 3,687  
                                                                                                     
Mid-Florida Lakes
  199 Forest Dr.   Leesburg   FL     34788       MH       290                       1,225       1225       80.7 %     81.9 %(b)   $ 5,406     $ 5,204  
                                                                                                     
Southernaire
  1700 Sanford Road   Mt. Dora   FL     32757       MH       14                       108       108       84.3 %     86.1 %   $ 4,151     $ 4,051  
                                                                                                     
Oak Bend
  10620 S.W. 27th Ave.   Ocala   FL     34476       MH       62       3               262       262       89.3 %     88.9 %(b)   $ 4,330     $ 4,227  
                                                                                                     
Villas at Spanish Oaks
  3150 N.E. 36th Avenue   Ocala   FL     34479       MH       69                       459       459       86.5 %     86.5 %   $ 4,373     $ 4,176  
                                                                                                     
Winter Garden
  13905 W. Colonial Dr.   Winter Garden   FL     34787       RV       27                       350       159       100.0 %     100.0 %   $ 4,074     $ 3,827  
                                                                                                     
Gulf Coast (Tampa/Naples):
                                                                                                   
                                                                                                     
Toby’s RV
  3550 N.E. Hwy 70   Arcadia   FL     34266       RV       44                       379       281       100.0 %     100.0 %   $ 2,543     $ 2,333  
                                                                                                     
Manatee
  800 Kay Road NE   Bradenton   FL     34212       RV       42                       415       220       100.0 %     100.0 %   $ 4,806     $ 4,549  
                                                                                                     
Windmill Manor
  5320 53rd Ave. East   Bradenton   FL     34203       MH       49                       292       292       95.9 %     95.5 %   $ 5,417     $ 5,241  
                                                                                                     
Glen Ellen
  2882 Gulf to Bay Blvd   Clearwater   FL     33759       MH       12                       106       106       90.6 %     94.3 %   $ 4,722     $ 4,431  
                                                                                                     
Hillcrest
  2346 Druid Road East   Clearwater   FL     33764       MH       25                       278       278       93.9 %     93.9 %   $ 4,701     $ 4,491  
                                                                                                     
Holiday Ranch
  4300 East Bay Drive   Clearwater   FL     33764       MH       12                       150       150       89.3 %     92.7 %   $ 4,229     $ 4,125  
                                                                                                     
Silk Oak
  28488 US Highway 19 N   Clearwater   FL     33761       MH       19                       181       181       90.1 %     92.3 %   $ 4,728     $ 4,455  
                                                                                                     
Crystal Isles
  11419 W. Ft. Island Drive   Crystal River   FL     34429       RV       32                       260       53       100.0 %     100.0 %   $ 5,154     $ 4,385  
                                                                                                     
Lake Haven
  1415 Main Street   Dunedin   FL     34698       MH       48                       379       379       90.8 %     91.3 %   $ 6,482     $ 6,194  

19


Table of Contents

                                                                                                     
                                                    New
                         
                                                    Total
                         
                                              Total
    Number
    Annual
    Annual
             
                                  Develo-
          Number
    of Annual
    Site
    Site
    Annual
    Annual
 
                                  Pable
          of Sites
    Sites
    Occupancy
    Occupancy
    Rent
    Rent
 
                            Acres
    Acres
    Expansion
    as of
    as of
    as of
    as of
    as of
    as of
 
Property
  Address   City   State   ZIP     MH/RV     (c)     (d)     Sites(e)     12/31/08     12/31/08     12/31/08     12/31/07     12/31/08     12/31/07  
 
                                                                                                     
Fort Myers Beach Resort
  16299 San Carlos Blvd.   Fort Myers   FL     33908       RV       31                       306       89       100.0 %     100.0 %   $ 5,689     $ 5,520  
                                                                                                     
Gulf Air Resort
  17279 San Carlos Blvd. SW   Fort Myers   FL     33931       RV       25                       246       159       100.0 %     100.0 %   $ 4,775     $ 4,515  
                                                                                                     
Barrington Hills
  9412 New York Avenue   Hudson   FL     34667       RV       28                       392       259       100.0 %     100.0 %   $ 2,920     $ 2,678  
                                                                                                     
Down Yonder
  7001 N. 142nd Avenue   Largo   FL     33771       MH       50                       361       361       98.9 %     99.4 %   $ 6,113     $ 5,734  
                                                                                                     
East Bay Oaks
  601 Starkey Road   Largo   FL     33771       MH       40                       328       328       97.3 %     97.9 %   $ 4,762     $ 4,495  
                                                                                                     
Eldorado Village
  2505 East Bay Drive   Largo   FL     33771       MH       25                       227       227       97.4 %     99.6 %   $ 4,661     $ 4,442  
                                                                                                     
Shangri La
  249 Jasper Street N.W.   Largo   FL     33770       MH       14                       160       160       89.4 %     91.9 %   $ 5,263     $ 5,056  
                                                                                                     
Vacation Village
  6900 Ulmerton Road   Largo   FL     33771       RV       29                       293       182       100.0 %     100.0 %   $ 4,173     $ 3,942  
                                                                                                     
Pasco
  21632 State Road 54   Lutz   FL     33549       RV       27                       255       176       100.0 %     100.0 %   $ 3,522     $ 3,356  
                                                                                                     
Buccaneer
  2210 N. Tamiami Trail N.E.   N. Ft. Myers   FL     33903       MH       223       39       162       971       971       98.5 %     98.2 %   $ 5,805     $ 5,490  
                                                                                                     
Island Vista MHC
  3000 N. Tamiami Trail   N. Ft. Myers   FL     33903       MH       121                       616       616       84.7 %     100.4 %   $ 4,049     $ 3,834  
                                                                                                     
Lake Fairways
  19371 Tamiami Trail   N. Ft. Myers   FL     33903       MH       259                       896       896       99.4 %     99.6 %   $ 5,819     $ 5,559  
                                                                                                     
Pine Lakes
  10200 Pine Lakes Blvd.   N. Ft. Myers   FL     33903       MH       314                       584       584       100.0 %     100.0 %   $ 6,781     $ 6,595  
                                                                                                     
Pioneer Village
  7974 Samville Rd.   N. Ft. Myers   FL     33917       RV       90                       733       392       100.0 %     100.0 %   $ 3,890     $ 3,675  
                                                                                                     
The Heritage
  3000 Heritage Lakes Blvd.   N. Ft. Myers   FL     33917       MH       214       22       132       453       453       98.7 %     98.0 %(b)   $ 5,084     $ 4,930  
                                                                                                     
Country Place
  2601 Country Place Blvd.   New Port Richey   FL     34655       MH       82                       515       515       99.8 %     99.8 %   $ 4,905     $ 3,844  
                                                                                                     
Hacienda Village
  7107 Gibraltar Ave   New Port Richey   FL     34653       MH       66                       505       505       97.8 %     97.6 %   $ 4,773     $ 4,564  
                                                                                                     
Harbor View
  6617 Louisna Ave   New Port Richey   FL     34653       MH       69                       471       471       98.5 %     97.5 %   $ 3,993     $ 3,823  
                                                                                                     
Bay Lake Estates
  1200 East Colonia Lane   Nokomis   FL     34275       MH       34                       228       228       93.0 %     95.2 %   $ 6,150     $ 5,963  
                                                                                                     
Royal Coachman
  1070 Laurel Road East   Nokomis   FL     34275       RV       111                       546       430       100.0 %     100.0 %   $ 6,042     $ 5,804  
                                                                                                     
Windmill Village
  16131 N. Cleveland Ave.   N. Ft. Myers   FL     33903       MH       69                       491       491       91.6 %     93.1 %   $ 4,723     $ 4,575  
                                                                                                     
Silver Dollar
  12515 Silver Dollar Drive   Odessa   FL     33556       RV       412                       385       385       100.0 %     100.0 %   $ 4,776     $ 4,420  
                                                                                                     
Terra Ceia
  9303 Bayshore Road   Palmetto   FL     34221       RV       18                       203       127       100.0 %     100.0 %   $ 3,555     $ 3,449  
                                                                                                     
Lakes at Countrywood
  745 Arbor Estates Way   Plant City   FL     33565       MH       122                       424       424       92.7 %     92.0 %(b)   $ 3,959     $ 3,785  
                                                                                                     
Meadows at Countrywood
  745 Arbor Estates Way   Plant City   FL     33565       MH       140       13       110       799       799       95.4 %     94.9 %(b)   $ 4,699     $ 4,510  
                                                                                                     
Oaks at Countrywood
  745 Arbor Estates Way   Plant City   FL     33565       MH       44                       168       168       76.2 %     76.8 %(b)   $ 3,984     $ 3,804  
                                                                                                     
Harbor Lakes
  3737 El Jobean Road #294   Port Charlotte   FL     33953       RV       80                       528       298       100.0 %     100.0 %   $ 4,470     $ 4,221  
                                                                                                     
Gulf View
  10205 Burnt Store Road   Punta Gorda   FL     33950       RV       78                       206       47       100.0 %     100.0 %   $ 4,328     $ 3,950  
                                                                                                     
Tropical Palms MHC
  17100 Tamiami Trail   Punta Gorda   FL     33955       MH       50                       297       297       86.5 %     85.2 %   $ 3,240     $ 3,167  
                                                                                                     
Winds of St. Armands No
  4000 N. Tuttle Ave.   Sarasota   FL     34234       MH       74                       471       471       94.9 %     94.7 %   $ 5,951     $ 5,364  
                                                                                                     
Winds of St. Armands So
  3000 N. Tuttle Ave.   Sarasota   FL     34234       MH       61                       306       306       99.3 %     99.3 %   $ 5,915     $ 5,610  
                                                                                                     
Topics
  13063 County Line Road   Spring Hill   FL     34609       RV       35                       230       195       100.0 %     100.0 %   $ 2,889     $ 2,739  
                                                                                                     
Pine Island
  5120 Stringfellow Road   St. James City   FL     33956       RV       31                       363       75       100.0 %     100.0 %     5009.85       4700.69  
                                                                                                     
Bay Indies
  950 Ridgewood Ave   Venice   FL     34285       MH       210                       1,309       1309       93.3 %     95.8 %   $ 6,683     $ 6,419  
                                                                                                     
Ramblers Rest
  1300 North River Rd.   Venice   FL     34293       RV       117                       647       437       100.0 %     100.0 %   $ 4,677     $ 4,350  
                                                                                                     
Sixth Avenue
  39345 6th Avenue   Zephyrhills   FL     33542       MH       14                       134       134       91.0 %     90.3 %   $ 2,436     $ 2,343  
                                                                                                     
                                                                                                     
Total Florida Market:
                                6,797       342       1468       35,183       28,239       93.6 %     94.1 %   $ 4,925     $ 4,616  
                                                                                                     
                                                                                                     
California
                                                                                                   
                                                                                                     
Northern California:
                                                                                                   
                                                                                                     
Monte del Lago
  13100 Monte del Lago   Castroville   CA     95012       MH       54                       310       310       96.8 %     93.2 %(b)   $ 12,282     $ 11,759  
                                                                                                     
Colony Park
  3939 Central Avenue   Ceres   CA     95307       MH       20                       186       186       90.9 %     89.8 %   $ 6,713     $ 6,881  
                                                                                                     
Four Seasons
  3138 West Dakota   Fresno   CA     93722       MH       40                       242       242       88.4 %     88.0 %   $ 4,163     $ 4,065  
                                                                                                     
Tahoe Valley
  1175 Melba Drive   Lake Tahoe   CA     96150       RV       86       20       200       413       0                          

20


Table of Contents

                                                                                                     
                                                    New
                         
                                                    Total
                         
                                              Total
    Number
    Annual
    Annual
             
                                  Develo-
          Number
    of Annual
    Site
    Site
    Annual
    Annual
 
                                  Pable
          of Sites
    Sites
    Occupancy
    Occupancy
    Rent
    Rent
 
                            Acres
    Acres
    Expansion
    as of
    as of
    as of
    as of
    as of
    as of
 
Property
  Address   City   State   ZIP     MH/RV     (c)     (d)     Sites(e)     12/31/08     12/31/08     12/31/08     12/31/07     12/31/08     12/31/07  
 
                                                                                                     
Sea Oaks
  1675 Los Osos Valley Rd., #221   Los Osos   CA     93402       MH       18                       125       125       98.4 %     98.4 %   $ 6,012     $ 5,861  
                                                                                                     
Coralwood
  331 Coralwood   Modesto   CA     95356       MH       22                       194       194       78.9 %     85.1 %   $ 8,433     $ 8,083  
                                                                                                     
Concord Cascade
  245 Aria Drive   Pacheco   CA     94553       MH       31                       283       283       100.0 %     100.0 %   $ 7,682     $ 7,495  
                                                                                                     
San Francisco RV
  700 Palmetto Ave   Pacifica   CA     94044       RV       12                       182       0                          
                                                                                                     
Quail Meadows
  5901 Newbrook Drive   Riverbank   CA     95367       MH       20                       146       146       96.6 %     98.6 %   $ 8,238     $ 8,039  
                                                                                                     
California Hawaiian
  3637 Snell Avenue   San Jose   CA     95136       MH       50                       418       418       99.3 %     99.0 %   $ 10,209     $ 9,920  
                                                                                                     
Sunshadow
  1350 Panoche Avenue   San Jose   CA     95122       MH       30                       121       121       98.3 %     97.5 %   $ 9,884     $ 9,444  
                                                                                                     
Village of the Four Seasons
  200 Ford Road   San Jose   CA     95138       MH       30                       271       271       95.2 %     92.6 %   $ 9,348     $ 8,847  
                                                                                                     
Westwinds (4 Properties)
  500 Nicholson Lane   San Jose   CA     95134       MH       88                       723       723       92.1 %     92.3 %   $ 11,034     $ 10,584  
                                                                                                     
Laguna Lake
  1801 Perfumo Canyon Road   San Luis Obispo   CA     93405       MH       100                       290       290       100.0 %     99.7 %   $ 5,514     $ 5,406  
                                                                                                     
Contempo Marin
  400 Yosemite Road   San Rafael   CA     94903       MH       63                       396       396       97.2 %     98.2 %   $ 8,482     $ 8,311  
                                                                                                     
DeAnza Santa Cruz
  2395 Delaware Avenue   Santa Cruz   CA     95060       MH       30                       198       198       93.9 %     94.9 %   $ 10,165     $ 9,676  
                                                                                                     
Santa Cruz Ranch RV Resort
  917 Disc Drive   Scotts Valley   CA     95066       RV       7                       106       0                              
                                                                                                     
Royal Oaks
  415 Akers Drive N.   Visalia   CA     93291       MH       20                       149       149       90.6 %     92.6 %   $ 5,215     $ 4,953  
                                                                                                     
Southern California:
                                                                                                   
                                                                                                     
Date Palm Country Club
  36-200 Date Palm Drive   Cathedral City   CA     92234       MH       232       3       24       538       538       98.3 %     98.1 %   $ 10,694     $ 10,240  
                                                                                                     
Date Palm RV
  36-100 Date Palm Drive   Cathedral City   CA     92234       RV       (f )                     140       0                          
                                                                                                     
Pacific Dunes Ranch
  1205 Silver Spur Place   Oceana   CA     93445       RV       48                       215       0                          
                                                                                                     
Rancho Mesa
  450 East Bradley Ave.   El Cajon   CA     92021       MH       20                       158       158       65.8 %     70.3 %   $ 11,259     $ 10,839  
                                                                                                     
Rancho Valley
  12970 Hwy 8 Business   El Cajon   CA     92021       MH       19                       140       140       97.9 %     95.0 %   $ 11,191     $ 10,922  
                                                                                                     
Royal Holiday
  4400 W Florida Ave   Hemet   CA     92545       MH       22                       179       179       66.5 %     57.5 %   $ 4,860     $ 4,770  
                                                                                                     
Las Palmas
  1025 S. Riverside Ave.   Rialto   CA     92376       MH       18                       136       136       100.0 %     100.0 %   $ 5,452     $ 5,175  
                                                                                                     
Parque La Quinta
  350 S. Willow Ave. #120   Rialto   CA     92376       MH       19                       166       166       99.4 %     100.0 %   $ 5,407     $ 5,172  
                                                                                                     
Meadowbrook
  8301 Mission Gorge Rd.   Santee   CA     92071       MH       43                       338       338       97.9 %     98.2 %   $ 8,926     $ 9,065  
                                                                                                     
Lamplighter
  10767 Jamacha Blvd.   Spring Valley   CA     91978       MH       32                       270       270       96.7 %     94.8 %   $ 11,471     $ 11,213  
                                                                                                     
Santiago Estates
  13691 Gavina Ave. #632   Sylmar   CA     91342       MH       113       9               300       300       100.0 %     100.0 %   $ 10,555     $ 10,067  
                                                                                                     
                                                                                                     
Total California Market
                                1,287       32       224       7,333       6,277       93.4 %     93.1 %   $ 8,466     $ 8,199  
                                                                                                     
                                                                                                     
Arizona
                                                                                                   
                                                                                                     
Countryside RV
  2701 S. Idaho Rd   Apache Junction   AZ     85219       RV       53                       560       317       100.0 %     100.0 %   $ 2,931     $ 2,843  
                                                                                                     
Golden Sun RV
  999 W Broadway Ave   Apache Junction   AZ     85220       RV       33                       329       239       100.0 %     100.0 %   $ 2,845     $ 2,738  
                                                                                                     
Casita Verde RV
  2200 N. Trekell Rd.   Casa Grande   AZ     85222       RV       14                       192       104       100.0 %     100.0 %   $ 2,222     $ 2,148  
                                                                                                     
Fiesta Grande RV
  1511 East Florence Blvd.   Casa Grande   AZ     85222       RV       77                       767       520       100.0 %     100.0 %   $ 2,610     $ 2,546  
                                                                                                     
Foothills West RV
  10167 N. Encore Dr.   Casa Grande   AZ     85222       RV       16                       188       134       100.0 %     100.0 %   $ 2,199     $ 2,106  
                                                                                                     
Monte Vista
  8865 E. Baseline Road   Mesa   AZ     85209       RV       142       56       515       832       763       100.0 %     100.0 %   $ 5,111     $ 4,756  
                                                                                                     
Viewpoint
  8700 E. University   Mesa   AZ     85207       RV       332       55       467       1,954       1517       100.0 %     100.0 %   $ 4,695     $ 4,528  
                                                                                                     
Venture In
  270 N. Clark Rd.   Show Low   AZ     85901       RV       26                       389       276       100.0 %     100.0 %   $ 2,699     $ 2,561  
                                                                                                     
Paradise
  10950 W. Union Hill Drive   Sun City   AZ     85373       RV       80                       950       816       100.0 %     100.0 %   $ 3,764     $ 3,823  
                                                                                                     
Araby
  6649 E. 32nd. St.   Yuma   AZ     85365       RV       25                       337       294       100.0 %     100.0 %   $ 3,015     $ 2,850  
                                                                                                     
Cactus Gardens
  10657 S. Ave. 9-E   Yuma   AZ     85365       RV       43                       430       292       100.0 %     100.0 %   $ 2,057     $ 1,962  
                                                                                                     
Capri RV
  3380 South 4th Ave   Yuma   AZ     85365       RV       20                       303       236       100.0 %     100.0 %   $ 2,791     $ 2,668  
                                                                                                     
Desert Paradise
  10537 South Ave., 9E   Yuma   AZ     85365       RV       26                       260       128       100.0 %     100.0 %   $ 2,076     $ 1,980  
                                                                                                     
Foothill
  12705 E. South Frontage Rd.   Yuma   AZ     85367       RV       18                       180       65       100.0 %     100.0 %   $ 2,115     $ 2,011  
                                                                                                     
Mesa Verde
  3649 & 3749 South 4th Ave.   Yuma   AZ     85365       RV       28                       345       310       100.0 %     100.0 %   $ 2,637     $ 2,272  
                                                                                                     
Suni Sands
  1960 East 32nd Street   Yuma   AZ     85365       RV       34                       336       191       100.0 %     100.0 %   $ 2,539     $ 2,426  
                                                                                                     
Casa del Sol East II
  10960 N. 67th Avenue   Glendale   AZ     85304       MH       29                       239       239       84.5 %     78.7 %   $ 6,733     $ 6,564  
                                                                                                     
Casa del Sol East III
  10960 N. 67th Avenue   Glendale   AZ     85304       MH       28                       236       236       81.8 %     82.6 %   $ 6,720     $ 6,496  
                                                                                                     
Palm Shadows
  7300 N. 51st. Avenue   Glendale   AZ     85301       MH       33                       294       294       82.7 %     81.3 %   $ 5,257     $ 4,960  

21


Table of Contents

                                                                                                     
                                                    New
                         
                                                    Total
                         
                                              Total
    Number
    Annual
    Annual
             
                                  Develo-
          Number
    of Annual
    Site
    Site
    Annual
    Annual
 
                                  Pable
          of Sites
    Sites
    Occupancy
    Occupancy
    Rent
    Rent
 
                            Acres
    Acres
    Expansion
    as of
    as of
    as of
    as of
    as of
    as of
 
Property
  Address   City   State   ZIP     MH/RV     (c)     (d)     Sites(e)     12/31/08     12/31/08     12/31/08     12/31/07     12/31/08     12/31/07  
 
                                                                                                     
Hacienda de Valencia
  201 S. Greenfield Rd.   Mesa   AZ     85206       MH       51                       365       365       98.4 %     93.7 %   $ 5,897     $ 5,659  
                                                                                                     
The Highlands at Brentwood
  120 North Val Vista Drive   Mesa   AZ     85213       MH       45                       268       268       99.3 %     96.3 %   $ 6,551     $ 6,242  
                                                                                                     
The Mark
  625 West McKellips   Mesa   AZ     85201       MH       60       4               410       410       62.9 %     57.6 %   $ 5,383     $ 5,146  
                                                                                                     
Apollo Village
  10701 N. 99th Ave.   Peoria   AZ     85345       MH       29       3               236       236       92.4 %     91.5 %(b)   $ 5,393     $ 5,247  
                                                                                                     
Casa del Sol West I
  11411 N. 91st Avenue   Peoria   AZ     85345       MH       31                       245       245       94.3 %     93.5 %   $ 6,293     $ 6,103  
                                                                                                     
Carefree Manor
  19602 N. 32nd Street   Phoenix   AZ     85050       MH       16                       130       130       93.1 %     80.8 %   $ 4,929     $ 4,868  
                                                                                                     
Central Park
  205 West Bell Road   Phoenix   AZ     85023       MH       37                       293       293       99.0 %     95.6 %   $ 5,901     $ 5,810  
                                                                                                     
Desert Skies
  19802 N. 32 Street   Phoenix   AZ     85024       MH       24                       165       165       100.0 %     98.8 %   $ 5,130     $ 4,999  
                                                                                                     
Sunrise Heights
  17801 North 16th Street   Phoenix   AZ     85022       MH       28                       199       199       94.0 %     91.0 %   $ 5,657     $ 5,420  
                                                                                                     
Whispering Palms
  19225 N. Cave Creek Rd.   Phoenix   AZ     85024       MH       15                       116       116       94.8 %     95.7 %   $ 4,507     $ 4,368  
                                                                                                     
Sedona Shadows
  6770 W. U.S. Hwy 89A   Sedona   AZ     86336       MH       48       6       10       198       198       100.0 %     99.5 %   $ 7,074     $ 6,702  
                                                                                                     
The Meadows
  2401 W. Southern Ave.   Tempe   AZ     85282       MH       60                       391       391       94.4 %     90.0 %   $ 6,171     $ 5,942  
                                                                                                     
Fairview Manor
  3115 N. Fairview Avenue   Tucson   AZ     85705       MH       28                       235       235       80.9 %     80.0 %   $ 4,636     $ 4,533  
                                                                                                     
                                                                                                     
Total Arizona Market
                                1,529       124       992       12,372       10,222       95.4 %     94.0 %   $ 4,329     $ 4,165  
                                                                                                     
                                                                                                     
Colorado
                                                                                                   
                                                                                                     
Hillcrest Village
  1600 Sable Boulevard   Aurora   CO     80011       MH       72                       601       601       81.0 %     76.9 %   $ 6,672     $ 6,540  
                                                                                                     
Cimarron
  12205 North Perry   Broomfield   CO     80020       MH       50                       327       327       82.6 %     84.1 %   $ 6,483     $ 6,351  
                                                                                                     
Holiday Village
  3405 Sinton Road   Co. Springs   CO     80907       MH       38                       240       240       75.8 %     78.3 %   $ 6,678     $ 6,697  
                                                                                                     
Bear Creek
  3500 South King Street   Denver   CO     80236       MH       12                       122       122       91.8 %     92.6 %   $ 6,498     $ 6,212  
                                                                                                     
Holiday Hills
  2000 West 92nd Avenue   Denver   CO     80260       MH       99                       736       736       83.3 %     83.8 %   $ 6,525     $ 6,397  
                                                                                                     
Golden Terrace
  17601 West Colfax Ave.   Golden   CO     80401       MH       32                       265       265       82.6 %     84.2 %   $ 7,211     $ 6,949  
                                                                                                     
Golden Terrace South
  17601 West Colfax Ave.   Golden   CO     80401       MH       15                       80       80       67.5 %     72.5 %   $ 7,080     $ 6,864  
                                                                                                     
Golden Terrace South RV
  17801 West Colfax Ave.   Golden   CO     80401       RV       (f )                     80       0                          
                                                                                                     
Golden Terrace West
  17601 West Colfax Ave.   Golden   CO     80401       MH       39       7               316       316       81.3 %     81.0 %   $ 7,049     $ 6,776  
                                                                                                     
Pueblo Grande
  999 Fortino Blvd. West   Pueblo   CO     81008       MH       33                       251       251       84.1 %     88.0 %   $ 4,005     $ 3,826  
                                                                                                     
Woodland Hills
  1500 W. Thornton Pkwy.   Thorton   CO     80260       MH       55                       434       434       80.2 %     82.7 %   $ 6,208     $ 5,902  
                                                                                                     
                                                                                                     
Total Colordao Market
                                445       7       0       3,452       3,372       81.0 %     82.4 %   $ 6,441     $ 6,251  
                                                                                                     
                                                                                                     
Northeast
                                                                                                   
                                                                                                     
Waterford
  205 Joan Drive   Bear   DE     19701       MH       159                       731       731       95.5 %     95.2 %(b)   $ 6,134     $ 5,915  
                                                                                                     
Whispering Pines
  32045 Janice Road   Lewes   DE     19958       MH       67       2               393       393       82.4 %     85.8 %   $ 4,580     $ 4,343  
                                                                                                     
Mariners Cove
  35356 Sussex Lane #1   Millsboro   DE     19966       MH       101                       375       375       95.7 %     94.9 %(b)   $ 6,923     $ 6,734  
                                                                                                     
Aspen Meadows
  303 Palace Lane   Rehoboth   DE     19971       MH       46                       200       200       100.0 %     100.0 %   $ 5,117     $ 4,921  
                                                                                                     
Camelot Meadows
  303 Palace Lane   Rehoboth   DE     19971       MH       61                       301       301       99.7 %     99.0 %   $ 4,854     $ 4,598  
                                                                                                     
McNicol
  303 Palace Lane   Rehoboth   DE     19971       MH       25                       93       93       98.9 %     98.9 %   $ 4,565     $ 4,434  
                                                                                                     
Sweetbriar
  83 Big Burn Lane   Rehoboth   DE     19958       MH       38                       146       146       98.6 %     98.6 %   $ 4,677     $ 4,485  
                                                                                                     
Old Chatham RV
  310 Old Chatham Road   South Dennis   MA     02660       RV       47       11               312       265       100.0 %     100.0 %   $ 3,625     $ 3,434  
                                                                                                     
Mount Desert Narrows
  1219 State Highway 3   Bar Harbor   ME     04609       RV       90       12               206       0                              
                                                                                                     
Patten Pond
  1470 Bucksport Road   Ellsworth   ME     04605       RV       43       60               137       2       100.0 %           $ 2,450          
                                                                                                     
Pinehurst RV Park
  7 Oregon Avenue, P.O. Box 174   Old Orchard Beach   ME     04064       RV       58                       550       511       100.0 %     100.0 %   $ 2,700     $ 2,501  
                                                                                                     
Narrows Too
  1150 Bar Harbor Road   Trenton   ME     04605       RV       42                       207       3       100.0 %           $ 3,165          
                                                                                                     
Scenic
  1314 Tunnel Rd.   Asheville   NC     28805       MH       28                       172       172       94.2 %     78.0 %   $ 3,537     $ 3,435  
                                                                                                     
Waterway RV
  850 Cedar Point Blvd.   Cedar Point   NC     28584       RV       27                       336       332       100.0 %     100.0 %   $ 3,220     $ 2,969  
                                                                                                     
Twin Lakes
  1618 Memory Lane   Chocowinity   NC     27817       RV       132       8       54       400       305       100.0 %     100.0 %   $ 2,611     $ 2,439  
                                                                                                     
Lake Myers RV
  2862 US Highway 64 West   Mocksville   NC     27028       RV       74                       425       282       100.0 %     100.0 %   $ 2,046     $ 1,993  
                                                                                                     
Goose Creek
  350 Red Barn Road   Newport   NC     28570       RV       92       6       51       598       605       100.0 %     100.0 %   $ 3,227     $ 3,039  

22


Table of Contents

                                                                                                     
                                                    New
                         
                                                    Total
                         
                                              Total
    Number
    Annual
    Annual
             
                                  Develo-
          Number
    of Annual
    Site
    Site
    Annual
    Annual
 
                                  Pable
          of Sites
    Sites
    Occupancy
    Occupancy
    Rent
    Rent
 
                            Acres
    Acres
    Expansion
    as of
    as of
    as of
    as of
    as of
    as of
 
Property
  Address   City   State   ZIP     MH/RV     (c)     (d)     Sites(e)     12/31/08     12/31/08     12/31/08     12/31/07     12/31/08     12/31/07  
 
                                                                                                     
Sandy Beach RV
  677 Clement Hill Road   Contoocook   NH     03229       RV       40                       190       114       100.0 %     100.0 %   $ 3,188     $ 3,050  
                                                                                                     
Tuxbury Resort
  88 Whitehall Road   South Hampton   NH     03827       RV       193       100               305       212       100.0 %     100.0 %   $ 2,982     $ 2,969  
                                                                                                     
Alpine Lake
  78 Heath Road   Corinth   NY     12822       RV       200       54               500       258       100.0 %     100.0 %   $ 2,697     $ 2,608  
                                                                                                     
Lake George Escape
  175 E. Schroon River Road, P.O. Box 431   Lake George   NY     12845       RV       178       30               576       21       100.0 %         $ 4,898          
                                                                                                     
Lake George Schroon Valley
  1730 Schroon River Rd   Warrensburg   NY     12885       RV       151                       151       0             (a)                
                                                                                                     
Greenwood Village
  370 Chapman Boulevard   Manorville   NY     11949       MH       79       14       7       512       512       100.0 %     100.0 %   $ 6,865     $ 6,516  
                                                                                                     
Brennan Beach
  80 Brennan Beach   Pulaski   NY     13142       RV       201                       1,377       1173       100.0 %     100.0 %   $ 1,977     $ 1,714  
                                                                                                     
Green Acres
  8785 Turkey Ridge Road   Breinigsville   PA     18031       MH       149                       595       595       91.9 %     93.3 %   $ 6,584     $ 6,315  
                                                                                                     
Spring Gulch
  475 Lynch Road   New Holland   PA     17557       RV       114                       420       119       100.0 %     100.0 %   $ 3,709     $ 3,711  
                                                                                                     
Appalachian
  60 Motel Drive   Shartlesville   PA     19554       RV       86       30       200       357       0             100.0 %         $ 2,693  
                                                                                                     
Inlet Oaks
  5350 Highway 17   Murrells Inlet   SC     29576       MH       35                       178       178       94.9 %     94.9 %   $ 3,545     $ 3,354  
                                                                                                     
Meadows of Chantilly
  4200 Airline Parkway   Chantilly   VA     22021       MH       82                       500       500       93.4 %     90.8 %   $ 9,625     $ 9,381  
                                                                                                     
                                                                                                     
Total Northeast Market
                                2,638       327       312       11,243       8,398       97.9 %     97.1 %   $ 4,212     $ 4,065  
                                                                                                     
                                                                                                     
Midwest
                                                                                                   
                                                                                                     
O’Connell’s
  970 Green Wing Road   Amboy   IL     61310       RV       286       100       600       668       355       100.0 %     100.0 %   $ 2,632     $ 2,497  
                                                                                                     
Willow Lake Estates
  161 West River Road   Elgin   IL     60123       MH       111                       617       617       68.2 %     71.3 %   $ 9,225     $ 9,223  
                                                                                                     
Golf Vista Estates
  25807 Firestone Drive   Monee   IL     60449       MH       144       4               408       408       94.6 %     98.0 %(b)   $ 7,379     $ 6,713  
                                                                                                     
Twin Mills RV
  1675 W SR 120   Howe   IN     46746       RV       137       5       50       501       232       100.0 %     100.0 %   $ 2,042     $ 1,922  
                                                                                                     
Lakeside
  7089 N. Chicago Road   New Carlisle   IN     46552       RV       13                       91       65       100.0 %     100.0 %   $ 2,187     $ 2,069  
                                                                                                     
Oak Tree Village
  254 Sandalwood Ave.   Portage   IN     46368       MH       76                       361       361       70.6 %     73.4 %   $ 5,036     $ 4,836  
                                                                                                     
Creekside
  5100 Clyde Pk. Ave. SW   Wyoming   MI     49509       MH       29                       165       165       64.2 %     67.3 %   $ 5,722     $ 5,582  
                                                                                                     
Caledonia
  8425 Hwy 38   Caledonia   WI     53108       RV       76                       247                                      
                                                                                                     
Fremont
  E. 6506 Highway 110   Fremont   WI     54940       RV       98       5               325       64       100.0 %     100.0 %   $ 2,750     $ 2,595  
                                                                                                     
Yukon Trails
  N2330 Co Rd. HH   Lyndon Station   WI     53944       RV       150       30               214       119       100.0 %     100.0 %   $ 1,616     $ 1,520  
                                                                                                     
Tranquil Timbers
  3668 Grondin Road   Sturgeon Bay   WI     54235       RV       125                       270       129       100.0 %     100.0 %   $ 1,719     $ 1,649  
                                                                                                     
Arrowhead
  W1530 Arrowhead Road   Wisconsin Dells   WI     53965       RV       166       40       200       377       153       100.0 %     100.0 %   $ 1,578     $ 1,512  
                                                                                                     
                                                                                                     
Total Midwest Market
                                1,411       184       850       4,244       2,668       90.7 %     91.8 %   $ 3,808     $ 3,647  
                                                                                                     
                                                                                                 
Nevada, Utah, New Mexico
                                                                                               
                                                                                                     
Bonanza
  3700 East Stewart Ave   Las Vegas   NV     89110       MH       43                       353       353       63.5 %     62.3 %   $ 6,053     $ 5,925  
                                                                                                     
Boulder Cascade
  1601 South Sandhill Rd   Las Vegas   NV     89104       MH       39                       299       299       77.3 %     78.3 %   $ 6,599     $ 6,396  
                                                                                                     
Cabana
  5303 East Twain   Las Vegas   NV     89122       MH       37                       263       263       98.5 %     98.9 %   $ 6,566     $ 6,404  
                                                                                                     
Flamingo West
  8122 West Flamingo Rd.   Las Vegas   NV     89147       MH       37                       258       258       99.6 %     99.2 %   $ 7,216     $ 6,887  
                                                                                                     
Villa Borega
  1111 N. Lamb Boulevard   Las Vegas   NV     89110       MH       40                       293       293       84.0 %     86.0 %   $ 6,714     $ 6,405  
                                                                                                     
Westwood Village
  1111 N. 2000 West   Farr West   UT     84404       MH       46                       314       314       94.3 %     94.3 %(b)   $ 4,295     $ 4,191  
                                                                                                     
All Seasons
  290 N. Redwood Rd   Salt Lake City   UT     84116       MH       19                       121       121       83.5 %     84.3 %   $ 5,321     $ 5,173  
                                                                                                     
                                                                                                 
Total Nevada, Utah, New Mexico Market
                            261       0       0       1,901       1,901       85.8 %     86.2 %   $ 6,109     $ 5,912  
                                                                                                 
                                                                                                     
Northwest
                                                                                                   
                                                                                                     
Casa Village
  14 Goldust Dr   Billings   MT     59102       MH       63                       490       490       73.5 %     73.3 %   $ 4,232     $ 4,102  
                                                                                                     
Mt. Hood
  65000 E Highway 26   Welches   OR     97067       RV       115       30       202       436       106       100.0 %     100.0 %   $ 5,229     $ 4,830  
                                                                                                     
Shadowbrook
  13640 S.E. Hwy 212   Clackamas   OR     97015       MH       21                       156       156       97.4 %     96.2 %   $ 7,456     $ 7,242  
                                                                                                     
Falcon Wood Village
  1475 Green Acres Road   Eugene   OR     97408       MH       23                       183       183       86.9 %     86.3 %   $ 5,766     $ 5,605  
                                                                                                     
Quail Hollow
  2100 N.E. Sandy Blvd.   Fairview   OR     97024       MH       21                       137       137       94.2 %     94.2 %   $ 7,314     $ 7,083  
                                                                                                     
Kloshe Illahee
  2500 S. 370th Street   Federal Way   WA     98003       MH       50                       258       258       98.8 %     98.8 %   $ 8,640     $ 8,509  
                                                                                                     
                                                                                                 
Total Northwest Market
                            293       30       202       1,660       1,330       91.8 %     91.5 %   $ 6,439     $ 6,229  
                                                                                                 
                                                                                                     
Texas
                                                                                                   
                                                                                                     
Lakewood
  4525 Graham Road   Harlingen   TX     78552       RV       30                       301       107       100.0 %     100.0 %   $ 1,970     $ 1,886  

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