Investing $500 in this High-Performing Asset Might Continue to Provide Robust Returns.
Exploring off-the-beat-path investments can lead to substantial rewards, and Sun Communities (SUI -1.28%) is an excellent example of this concept. This real estate investment trust (REIT) is a trailblazer in its niche, owning and operating a diverse portfolio of properties, including manufactured home communities, RV resorts, marinas, and U.K. holiday parks.
With over 288 manufactured home communities across North America, 179 RV communities, 138 marinas, and 54 U.K. holiday parks, Sun Communities is a leading player in the industry. It boasts the distinction of being the largest publicly traded owner and operator of manufactured home communities, RV parks, and marinas, as well as the second-largest player in the U.K. holiday park space.
The demand for these properties is robust and consistent, as people seek out affordable and convenient living options. With limited new supply entering the market each year, Sun Communities has the leverage to steadily increase rates, even in challenging economic conditions. The company has a proven track record of delivering positive same-property net operating income (NOI) growth for 23 consecutive years, at a 5.2% compound annual rate, outpacing the REIT industry average.
Sun Communities' growth strategy doesn't stop at rental rate increases; there are various avenues for expansion. With plans to boost rents by more than 5% in 2023, the company aims to capitalize on this growth potential. Additionally, leasing vacant manufactured home sites and converting transient RV sites to annual leases provide additional opportunities for revenue growth. Sun Communities also invests in expanding its properties and adding more sites where necessary.
Furthermore, Sun Communities has a strong financial foundation, boasting an investment-grade balance sheet that allows it to seize acquisition opportunities when they arise. Recent acquisitions of Safe Harbor Marinas and Park Holidays UK illustrate its ability to grow its portfolio through strategic investments.
Sun Communities' strong financial performance and growth potential have translated into significant shareholder value, as evidenced by its 111% dividend increase since its initial public offering in 1993. This consistent income stream, coupled with an attractive 3% dividend yield, provides investors with a solid foundation for investment returns.
While manufactured home communities and associated properties may not be the most exciting investments, Sun Communities has proven that they can deliver consistent income and impressive total returns for investors over the long term. With growth potential in various segments and a strong financial foundation, Sun Communities remains a compelling investment opportunity for those looking to diversify their portfolios and reap the rewards of unconventional investments.
- Investors seeking to diversify their portfolios and explore off-the-beat-path investments might find Sun Communities' offerings appealing, given its substantial returns in manufactured home communities and RV resorts.
- As more people seek affordable and convenient living options, Sun Communications' investment in RV resorts, such as those with appealing vacancies, could potentially yield high returns for investors.
- To further boost its financial performance, Sun Communities is planning to increase rental rates by more than 5% in 2023, which might attract investors interested in income-generating opportunities in the finance and investing sector.
- Sun Communities' recent acquisitions, like Safe Harbor Marinas and Park Holidays UK, demonstrate its commitment to expanding its investments in the sun-soaked lifestyle-oriented industries, such as RV resorts and marinas.