One of the interesting tidbits to come out of the Equity Lifestyle Properties Inc. (ELS) conference call Tuesday (April 19) on its first-quarter financial results was the revelation by CEO Marguerite Nader that the Chicago-based real-estate investment trust made a bid for Carefree Communities Inc.
“We reviewed the due-diligence material and we expressed an interest in buying the portfolio at what we thought was a full price,” she said. “We obviously weren’t the highest offer.” That, instead, came from ELS competitor Sun Communities Inc., which is in the process of purchasing Carefree for $1.68 billion.
Nader noted that while the company hasn’t made any large acquisitions since 2011, it is in the process of making more acquisitions and is still eyeing the market. Few new RV or manufactured housing parks have been built in the last 20 years due to the long time required for a return on investment, she noted, so ELS is very familiar with what’s available.
Acquisitions aside, ELS saw lots of growth in the quarter.
“Our operations performed very well in the quarter. We continued our occupancy trend,” Nader said. “Our RV properties performed well with a 5.3% growth rate.
“The winter RV season performed well and we are now focused on the summer season. We have developed our ‘100 Days of Camping’ marketing campaign, designed to maximize the summer season for our customers,” she explained.
Another interesting trend Nader highlighted is how short-term RV guests are booking sites at ELS properties. Half of the company’s transient RV traffic for the year comes between Memorial Day and Labor Day, Nader said, and the company is ready for the summer rush. She credited ELS employees with the company’s excellent results coming out of the Snowbird season and its ability to take care of customers for the season ahead.
Half of ELS transient bookings come through their call center, and half come online. Of those, half come via computer and half via smartphone — and smartphone bookings have grown significantly over the last year, she said.
Paul Seavey, chief operating officer of ELS, said that via the company’s Thousand Trail and Encore brands, it sold and activated 5,300 memberships in the quarter and upgraded another 530 members.
Looking ahead, for the second quarter of this year ELS projects 5% growth over last year in terms of RV revenue — 5.4% growth in income from annual guests, 2% from seasonal guests and 5% from transient guests, Seavey said. Reservations for both seasonal and transient guests are ahead of the same point last year.
Finally, for the year ELS expects to see RV revenue growth of 4.7%, with 5.6% growth in annual-guest revenue and 3.4% revenue growth from transient guests.