<PAGE> 1
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
AMENDMENT NO. 1 TO
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
DATE OF REPORT: DECEMBER 31, 1997
(Date of earliest event reported)
SUN COMMUNITIES, INC.
(Exact name of registrant as specified in its charter)
MARYLAND COMMISSION FILE NO. 1-12616 38-2730780
(State of incorporation (IRS Employer I.D. No.)
31700 MIDDLEBELT ROAD
SUITE 145
FARMINGTON HILLS, MICHIGAN 48334
(Address of principal executive offices)
(248) 932-3100
(Registrant's telephone number, including area code)
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Page 1 of 19 pages
<PAGE> 2
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
The financial statements and the pro forma financial information of the
Registrant for the properties acquired by the Registrant during the 1997
calendar year, prepared in accordance with Regulation S-X, are included in this
Report. Pursuant to Regulation S-X, financial statements are being provided
for only four such properties as the aggregate purchase price for such
properties is more than fifty percent (50%) of the aggregate purchase price of
all properties acquired by the Registrant during the 1997 calendar year.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
SUN COMMUNITIES, INC.,
a Maryland corporation
Date: March 13, 1998 By: /s/Jeffrey P. Jorissen
--------------------------------------------
Jeffrey P. Jorissen, Senior Vice
President, Treasurer, Chief Financial
Officer, and Secretary
Page 2 of 19 pages
<PAGE> 3
FINANCIAL STATEMENTS AND PRO FORMA INFORMATION
TABLE OF CONTENTS
FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
Southfork Mobile Home Park Page
--------------------------
<S> <C>
Report of Independent Accountants ................................... 4
Historical Summaries of Gross Income and Direct Operating Expenses .. 5
Woodside Terrace
----------------
Report of Independent Accountants ................................... 7
Historical Summaries of Gross Income and Direct Operating Expenses .. 8
Willowbrook Place
-----------------
Report of Independent Accountants ................................... 10
Historical Summaries of Gross Income and Direct Operating Expenses .. 11
White Oak Estates
-----------------
Report of Independent Accountants ................................... 13
Historical Summaries of Gross Income and Direct Operating Expenses .. 14
PRO FORMA INFORMATION
---------------------
Pro Forma Condensed Consolidated Statement of Operations
for the year ended December 31, 1996 (unaudited) .................... 16
</TABLE>
Page 3 of 19 pages
<PAGE> 4
[COOPERS & LYBRAND LETTERHEAD]
REPORT OF INDEPENDENT ACCOUNTANTS
Board of Directors and Shareholders
of Sun Communities, Inc.:
We have audited the accompanying historical summaries of gross income and
direct operating expenses (the "Historical Summaries") of Southfork Mobile Home
Park for the six-month period ended June 30, 1997 and the year ended December
31, 1996. These Historical Summaries are the responsibility of Southfork Mobile
Home Park's management. Our responsibility is to express an opinion on the
Historical Summaries based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the Historical Summaries are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the Historical Summaries. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall presentation of
the Historical Summaries. We believe that our audits provide a reasonable
basis for our opinion.
The accompanying Historical Summaries were prepared for the purpose of
complying with the rules and regulations of the Securities and Exchange
Commission and are not intended to be a complete presentation of Southfork
Mobile Home Park's revenues and expenses.
In our opinion, the Historical Summaries referred to above present fairly, in
all material respects, the gross income and direct operating expenses described
in Note 1 of Southfork Mobile Home Park for the six-month period ended June 30,
1997 and the year ended December 31, 1996, in conformity with generally
accepted accounting principles.
COOPERS & LYBRAND L.L.P.
- ------------------------
Coopers & Lybrand L.L.P.
Detroit, Michigan
January 9, 1998
Page 4 of 19 pages
<PAGE> 5
SUN COMMUNITIES, INC.
SOUTHFORK MOBILE HOME PARK
HISTORICAL SUMMARIES OF GROSS INCOME AND DIRECT OPERATING EXPENSES
for the six-month period ended June 30, 1997 and the year ended December 31,
1996
<TABLE>
<CAPTION>
SIX
MONTHS YEAR
ENDED ENDED
JUNE 30, DEC 31,
1997 1996
----------- ------------
<S> <C> <C>
Gross Income:
Rental income $ 516,915 $ 939,282
Other income 160,306 307,336
----------- ------------
Total gross income 677,221 1,246,618
----------- ------------
Direct operating costs:
Property operating and maintenance expenses 260,961 501,862
Real estate taxes 21,534 42,837
General and administrative 23,686 46,602
----------- ------------
306,181 591,301
----------- ------------
Gross income in excess of direct operating expenses $ 371,040 $ 655,317
=========== ============
</TABLE>
The accompanying note is an integral part of the historical summaries.
Page 5 of 19 pages
<PAGE> 6
SUN COMMUNITIES, INC.
SOUTHFORK MOBILE HOME PARK
NOTE TO HISTORICAL SUMMARIES OF GROSS INCOME AND DIRECT OPERATING
EXPENSES
1. BASIS OF PRESENTATION:
The Historical Summaries have been prepared pursuant to the rules and
regulations of the Securities and Exchange Commission for the real estate
operations acquired. The Historical Summaries are not representative of
the actual operations for the periods presented, as certain expenses
which may not be comparable to the expenses expected to be incurred by
Sun Communities, Inc. in the proposed future operations of Southfork
Mobile Home Park have been excluded. Expenses excluded consist of
management fees, interest, depreciation, certain professional fees and
other indirect costs not directly related to the future operations of the
Southfork Mobile Home Park property. Rental income is recognized when
due from residents.
The Historical Summaries relate to operations of the property which
was acquired by Sun Communities, Inc. in December, 1997. Southfork
Mobile Home Park had 476 developed sites at June 30, 1997.
Page 6 of 19 pages
<PAGE> 7
[COOPERS & LYBRAND LETTERHEAD]
REPORT OF INDEPENDENT ACCOUNTANTS
Board of Directors and Shareholders
of Sun Communities, Inc.:
We have audited the accompanying historical summaries of gross income and
direct operating expenses (the "Historical Summaries") of Woodside Terrace for
the six-month period ended June 30, 1997 and the year ended December 31, 1996.
These Historical Summaries are the responsibility of Woodside Terrace's
management. Our responsibility is to express an opinion on the Historical
Summaries based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the Historical Summaries are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the Historical Summaries. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall presentation of
the Historical Summaries. We believe that our audits provide a reasonable
basis for our opinion.
The accompanying Historical Summaries were prepared for the purpose of
complying with the rules and regulations of the Securities and Exchange
Commission and are not intended to be a complete presentation of Woodside
Terrace's revenues and expenses.
In our opinion, the Historical Summaries referred to above present
fairly, in all material respects, the gross income and direct operating
expenses described in Note 1 of Woodside Terrace for the six-month period ended
June 30, 1997 and the year ended December 31, 1996, in conformity with
generally accepted accounting principles.
Coopers & Lybrand L.L.P.
Detroit, Michigan
January 9, 1998
Page 7 of 19 pages
<PAGE> 8
SUN COMMUNITIES, INC.
WOODSIDE TERRACE
HISTORICAL SUMMARIES OF GROSS INCOME AND DIRECT OPERATING EXPENSES
for the six-month period ended June 30, 1997 and the year ended
December 31, 1996
<TABLE>
<CAPTION>
SIX
MONTHS YEAR
ENDED ENDED
JUNE 30, DEC 31,
1997 1996
--------- ----------
<S> <C> <C>
Gross Income:
Rental income $ 653,969 $1,282,038
Other income 14,438 37,824
--------- ----------
Total gross income 668,407 1,319,862
--------- ----------
Direct operating costs:
Property operating and maintenance expenses 122,036 304,815
Real estate taxes 19,947 40,260
General and administrative 6,077 29,847
--------- ----------
148,060 374,922
--------- ----------
Gross income in excess of direct operating expenses $ 520,347 $ 944,940
========= ==========
</TABLE>
The accompanying note is an integral part of the Historical Summaries.
Page 8 of 19 pages
<PAGE> 9
SUN COMMUNITIES, INC.
WOODSIDE TERRACE
NOTE TO HISTORICAL SUMMARIES OF GROSS INCOME AND DIRECT OPERATING EXPENSES
1. BASIS OF PRESENTATION:
The Historical Summaries have been prepared pursuant to the
rules and regulations of the Securities and Exchange Commission for the
real estate operations acquired. The Historical Summaries are not
representative of the actual operations for the periods presented, as
certain expenses which may not be comparable to the expenses expected
to be incurred by Sun Communities, Inc. in the proposed future
operations of Woodside Terrace have been excluded. Expenses excluded
consist of management fees, interest, depreciation, certain professional
fees and other indirect costs not directly related to the future
operations of the Woodside Terrace property. Rental income is
recognized when due from residents.
The Historical Summaries relate to operations of the property which
was leased by Sun Communities, Inc in November, 1997. Woodside
Terrace had 439 developed sites at June 30, 1997.
Page 9 of 19 pages
<PAGE> 10
[COOPERS & LYBRAND LETTERHEAD]
REPORT OF INDEPENDENT ACCOUNTANTS
Board of Directors and Shareholders
of Sun Communities, Inc.:
We have audited the accompanying historical summaries of gross income and
direct operating expenses (the "Historical Summaries") of Willowbrook Place for
the six-month period ended June 30, 1997 and the year ended December 31, 1996.
These Historical Summaries are the responsibility of Willowbrook Place's
management. Our responsibility is to express an opinion on the Historical
Summaries based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the Historical Summaries are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the Historical Summaries. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall presentation of
the Historical Summaries. We believe that our audits provide a reasonable
basis for our opinion.
The accompanying Historical Summaries were prepared for the purpose of
complying with the rules and regulations of the Securities and Exchange
Commission and are not intended to be a complete presentation of Willowbrook
Place's revenues and expenses.
In our opinion, the Historical Summaries referred to above present fairly, in
all material respects, the gross income and direct operating expenses described
in Note 1 of Willowbrook Place for the six-month period ended June 30, 1997 and
the year ended December 31, 1996, in conformity with generally accepted
accounting principles.
Coopers & Lybrand LLP
Detroit, Michigan
January 9, 1998
Page 10 of 19 pages
<PAGE> 11
SUN COMMUNITIES, INC.
WILLOWBROOK PLACE
HISTORICAL SUMMARIES OF GROSS INCOME AND DIRECT OPERATING EXPENSES
for the six-month period ended June 30, 1997 and the year ended
December 31, 1996
<TABLE>
<CAPTION>
SIX
MONTHS YEAR
ENDED ENDED
JUN 30, DEC 31,
1997 1996
----------- -----------
<S> <C> <C>
Gross Income:
Rental income $ 390,809 $ 765,642
Other income 4,175 13,850
----------- -----------
Total gross income 394,984 779,492
----------- -----------
Direct operating costs:
Property operating and maintenance expenses 66,426 145,452
Real estate taxes 18,234 36,802
General and administrative 6,523 11,159
----------- -----------
Total direct operating expenses 91,183 193,413
----------- -----------
Gross income in excess of direct operating expenses $ 303,801 $ 586,079
=========== ===========
</TABLE>
The accompanying note is an integral part of the Historical Summaries.
Page 11 of 19 pages
<PAGE> 12
SUN COMMUNITIES, INC.
WILLOWBROOK PLACE
NOTE TO HISTORICAL SUMMARIES OF GROSS INCOME AND DIRECT OPERATING
EXPENSES
1. BASIS OF PRESENTATION:
The Historical Summaries have been prepared pursuant to the rules and
regulations of the Securities and Exchange Commission for the real estate
operations acquired. The Historical Summaries are not representative of
the actual operations for the periods presented, as certain expenses
which may not be comparable to the expenses expected to be incurred by
Sun Communities, Inc. in the proposed future operations of Willowbrook
Place have been excluded. Expenses excluded consist of management fees,
interest, depreciation, certain professional fees and other indirect
costs not directly related to the future operations of the Willowbrook
Place property. Rental income is recognized when due from residents.
The Historical Summaries relate to operations of the property which
was leased by Sun Communities, Inc. in December, 1997. Willowbrook
Place had 266 developed sites at June 30, 1997.
Page 12 of 19 pages
<PAGE> 13
[COOPERS & LYBRAND LETTERHEAD]
REPORT OF INDEPENDENT ACCOUNTANTS
Board of Directors and Shareholders
of Sun Communities, Inc.:
We have audited the accompanying historical summaries of gross income and
direct operating expenses (the "Historical Summaries") of White Oak Estates for
the six-month period ended June 30, 1997 and the year ended December 31, 1996.
These Historical Summaries are the responsibility of White Oak Estates'
management. Our responsibility is to express an opinion on the Historical
Summaries based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the Historical Summaries are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the Historical Summaries. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall presentation of
the Historical Summaries. We believe that our audits provide a reasonable
basis for our opinion.
The accompanying Historical Summaries were prepared for the purpose of
complying with the rules and regulations of the Securities and Exchange
Commission and are not intended to be a complete presentation of White Oak
Estates' revenues and expenses.
In our opinion, the Historical Summaries referred to above present fairly, in
all material respects, the gross income and direct operating expenses described
in Note 1 of White Oak Estates for the six-month period ended June 30, 1997 and
the year ended December 31, 1996, in conformity with generally accepted
accounting principles.
Coopers & Lybrand L.L.P.
Detroit, Michigan
December 23, 1997
Page 13 of 19 pages
<PAGE> 14
SUN COMMUNITIES, INC.
WHITE OAK ESTATES
HISTORICAL SUMMARIES OF GROSS INCOME AND DIRECT OPERATING EXPENSES
for the six-month period ended June 30, 1997 and the year ended December 31,
1996
<TABLE>
<CAPTION>
SIX
MONTHS YEAR
ENDED ENDED
JUN 30, DEC 31,
1997 1996
----------- ----------
<S> <C> <C>
Gross Income:
Rental income $ 536,975 $ 1,039,433
Other income 3,135 6,801
----------- ----------
Total gross income 540,110 1,046,234
----------- ----------
Direct operating costs:
Property operating and maintenance expenses 150,073 292,968
Real estate taxes 56,991 106,547
General and administrative 2,352 11,880
----------- ----------
209,416 411,395
----------- ----------
Gross income in excess of direct operating expenses $ 330,694 $ 634,839
=========== ==========
</TABLE>
The accompanying note is an integral part of the Historical Summaries.
Page 14 of 19 pages
<PAGE> 15
SUN COMMUNITIES, INC.
WHITE OAK ESTATES
NOTE TO HISTORICAL SUMMARIES OF GROSS INCOME AND DIRECT OPERATING
EXPENSES
1. BASIS OF PRESENTATION:
The Historical Summaries have been prepared pursuant to the rules and
regulations of the Securities and Exchange Commission for the real estate
operations acquired. The Historical Summaries are not representative of
the actual operations for the periods presented, as certain expenses
which may not be comparable to the expenses expected to be incurred by
Sun Communities, Inc. in the proposed future operations of White Oak
Estates have been excluded. Expenses excluded consist of management
fees, interest, depreciation, certain professional fees and other
indirect costs not directly related to the future operations of the White
Oak Estates property. Rental income is recognized when due from
residents.
The Historical Summaries relate to operations of White Oak Estates
which was acquired by Sun Communities, Inc. in December, 1997. White Oak
Estates had 377 developed sites at June 30, 1997.
Page 17 of 19 pages
<PAGE> 16
SUN COMMUNITIES, INC.
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
DECEMBER 31, 1996
(UNAUDITED)
During 1997, the Company acquired twelve manufactured housing communities,
consisting of 4,258 manufactured housing and recreational vehicle sites, for an
aggregate purchase price of $69.8 million. All communities were acquired from
parties unrelated to the Company. In acquiring these manufactured housing
communities, management evaluated material factors including, but not limited
to, each community's operating income, location and competition, rent
structure, occupancy rates, developed sites and undeveloped sites or property.
The following pro forma consolidated balance sheet as of December 31, 1996 and
the pro forma consolidated statement of operations for the year then ended have
been prepared to reflect the acquisition of the twelve manufactured housing
communities. The pro forma financial information is based on the consolidated
historical financial statements of Sun Communities, Inc. and should be read in
conjunction with those financial statements and the notes thereto. The pro
forma consolidated balance sheet was prepared as if the acquisitions described
herein occurred on December 31, 1996. The pro forma consolidated statement of
operations was prepared as if the acquisitions described herein occurred on
January 1, 1996. The pro forma financial information is unaudited and is not
necessarily indicative of the results which actually would have occurred if the
transaction had been consummated on the dates described, nor does it purport to
represent the Company's future financial position or results of operations.
<TABLE>
<CAPTION>
Sun Sun
Communities, Inc. Pro Forma Communities, Inc.
(A) Adjustments Pro Forma
------------------ ----------------- --------------------
(in thousands)
<S> <C> <C> <C>
Assets:
Investment in real estate, net $558,278 $69,800 (B) $628,078
Cash and cash equivalents 9,236 (9,200)(B) 36
Investment in Sun Home Services, Inc. 5,103 5,103
Mortgage notes receivable 4,176 4,176
Other assets 8,263 8,263
---------------- ------------- -------------
Total assets $585,056 $60,600 $645,656
================ ============= =============
Liabilities:
Line of credit $8,200 (C) $8,200
Debt $185,000 52,400 (C) 237,400
Accounts payable and
accrued expenses 7,718 7,718
Deposits and other liabilities 9,123 9,123
---------------- ------------- -------------
Total liabilities 201,841 60,600 262,441
---------------- ------------- -------------
Minority interests 82,283 82,283
---------------- -------------
Stockholders' equity:
Common stock 154 154
Paid in capital 328,321 328,321
Officers' notes (9,173) (9,173)
Distributions in excess of accumulated earnings (18,370) (18,370)
---------------- ------------- ------------
Total stockholders' equity 300,932 0 300,932
---------------- ------------- -------------
Total liabilities and stockholders' equity $585,056 $60,600 $645,656
================ ============= =============
</TABLE>
- ------------------
(A) Reflects the Company's historical consolidated balance sheet as of December
31, 1996.
(B) Amounts presented reflect the acquisition of twelve manufactured home
communities.
(C) Includes $35 million of senior notes issued, $17,400 of collateralized
lease obligations and $8,200 borrowed from the Company's line of credit.
Page 16 of 19 pages
<PAGE> 17
SUN COMMUNITIES, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1996
(UNAUDITED)
<TABLE>
<CAPTION>
Sun Gross Income and Direct Operating Other Sun
Communities, Inc. Expenses of Acquired Properties Pro Forma Communities, Inc.
(A) (B) (C) Adjustments Pro Forma
----------------- -------------- --------------- ------------- -----------------
<S> <C> <C> <C> <C> <C>
REVENUES (in thousands except per share data)
Income from property $71,312 $4,392 $4,654 $80,358
Income from Sun Home Services, Inc. 506 506
Other income 1,381 1,381
-------- ------ ------ ------- -------
Total revenues 73,199 4,392 4,654 0 82,245
-------- ------ ------ ------- -------
EXPENSES
Property operating and maintenance 15,970 1,345 1,651 18,966
Real estate taxes 5,654 226 371 6,251
General and administrative 3,458 3,458
Depreciation and amortization 14,887 2,321 (E) 17,208
Interest 11,277 4,051 (D) 15,328
-------- ------ ------ ------- -------
Total expenses 51,246 1,571 2,022 6,372 61,211
-------- ------ ------ ------- -------
Income before minority interests 21,953 2,821 2,632 (6,372) 21,034
Less income allocated to minority interests:
Preferred OP Units 1,670 1,670
Common OP Units 2,473 (114)(F) 2,359
-------- ------ ------ ------- -------
Net income (G) $17,810 $2,821 $2,632 ($6,258) $17,005
======== ====== ====== ======= =======
Net income per common share $1.24
Weighted average number of shares 13,733
outstanding
</TABLE>
(A) Reflects the historical operations of Sun Communities, Inc. for the year
ended December 31, 1996.
(B) These adjustments are derived from audited Historical Summaries of Gross
Income and Direct Operating Expenses for four manufactured housing
communities the Company acquired for an aggregate purchase price of $36.3
million.
(C) These adjustments reflect the unaudited gross income and direct operating
expenses of eight manufactured housing communities the Company acquired in
Florida (4), Texas (2), Indiana (1) and Michigan (1), for an aggregate
purchase price of $33.5 million. The communities contained an aggregate of
2,809 sites at their respective acquisition dates, including 1,867
manufactured housing sites, 604 recreational vehicle sites and 338
undeveloped sites.
(D) Reflects the adjustment necessary to reflect annual interest expense
computed as follows:
$8,200 Line of credit at 6.89% $565
$35,000 Senior Notes at 6.97% 2,440
$17,400 lease obligations at 6.1% 1,047
------
$4,051
======
(E) Reflects depreciation on the acquired communities.
(F) Reflects the adjustment necessary to state minority interest at 12.4%.
(G) Before extraordinary income.
Page 17 of 19 pages
<PAGE> 18
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Description Filed Herewith
------- ----------- --------------
<S> <C> <C>
23.1 Consent of Coopers & Lybrand L.L.P., X
independent accountants
</TABLE>
Page 18 of 19 pages
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the registration statements of
Sun Communities, Inc. on Forms S-3 (File No. 33-95694; File No. 333-1822; File
No. 333-2522; File No. 333-14595; File No. 333-36451; File No. 333-45273) and on
Form S-8 (File No. 333-11923) of our reports dated January 9, 1998 on our
audits of the Historical Summaries of Gross Income and Direct Operating
Expenses of each of Willowbrook Place, Woodside Terrace, and White Oak Estates,
and our report dated December 23, 1997 on our audit of the Historical Summaries
of Gross Income and Direct Operating Expenses of Southfork Mobile Home Park,
for the six months period ended June 30, 1997 and the year ended December 31,
1996, which reports are included in this Current Report on Form 8-K.
Coopers & Lybrand L.L.P.
- ---------------------------
Coopers & Lybrand L.L.P.
Detroit, Michigan
March 13, 1998
Page 17 of 19 pages
