Good morning, ladies and gentlemen, and thank you for standing by. Welcome to the Sun Communities Second Quarter 2020 Earnings Conference Call. At this time, management would like to inform you that certain statements made during this conference call, which are not historical facts, may be deemed forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Although the company believes the expectations reflected in any forward looking statements are based on reasonable assumptions, the company can provide no assurance that its expectations will be achieved. Factors and risks that could cause actual results to differ materially from expectations include the effects of the COVID-nineteen pandemic and others detailed in yesterday's press release and from time to time in the company's periodic filings within the SEC.
The company undertakes no obligation to revise or update any forward looking statements to reflect events or circumstances after the date of the release. Having said this, I'd like to introduce management with us today Gary Shiffman, Chairman and Chief Executive Officer John McLaurin, President and Chief Operating Officer and Karen Dearing, Chief Financial Officer. After the remarks, there will be an opportunity to ask a question. I'll now turn the call over to Gary Shiffman, Chairman and Chief Executive Officer. Mr.
Shiffman, Please go ahead.
Thank you, operator. Good morning and thank you for joining us today as we discuss our Q2 results and provide an update on how Sun is navigating the impact of COVID-nineteen. We hope that everyone is staying healthy and managing through this challenging time. The intensity of the pandemic across the country continues to evolve and the environment has been challenging, But I'm happy to report that all of our manufactured housing and RV properties are open for business and performing. We have worked hard to keep our residents, guests and team members safe.
From a customer service perspective, We remain focused on delivering the signature service that Sun's residents and guests have come to expect across the portfolio. We are pleased with our results for the Q2 in light of the challenges presented by the virus. The team's skilled execution of our Operating and financial plans has served to mitigate the impact on our business. For the Q2, we realized a net FFO impact of approximately $10,800,000 below our original budget, which is better than our initial expectation of $15,000,000 to $18,000,000 provided during our first quarter release. Factors driving our performance included strong manufactured housing revenues, rental program results and expense savings in personnel costs and variable operating expenses, primarily due to RV resorts that were not open.
Offsets to positive contributors in the quarter were largely due to the COVID related restrictions on our transient RV business. Despite obstacles related to the virus, our reported core FFO per share was $1.12 for the 2nd quarter. In addition, Sun Communities generated positive same community NOI growth of 1.4%. Adjusting for $900,000 of direct COVID-nineteen related expenses, NOI growth would have been 2%. As of June 30, 2020, all of our manufactured housing communities and RV resorts are open with varying degrees of occupancy limitations and certain of our amenities to comply with public health guidelines set by state and local governments.
Over 80% of our furlough team members have returned to work and base compensation for main office team members, Executive officers and the Board has been restored to prior levels. From an operational perspective, We are seeing the resilience of Sun's unique platform in action. Total portfolio occupancy in the 2nd quarter rose 70 basis points year over year as we added 851 revenue producing sites, a 27% increase over last year. We also completed the construction of almost 500 vacant expansion, redevelopment and ground up development sites. As the country has reopened, we've experienced Steady incremental improvement in our reservation pace for July August.
Moreover, our forward bookings for September October has surpassed pre pandemic budgeted expectations. While the potential for local and state mandates could impact this trend, We believe this improved reservation pace reflects pent up demand and our ability to offer a vacation option that is perceived to be both safer and easier to control as compared to other alternatives. RV travel Is the preferred mode for families to get away this summer, expected strong sales growth in June and beyond Limited only by the amount of available inventory supports this thesis as discussed by major RV manufacturers like Winnebago and Thor Industries. Articles on the RV lifestyle are trending in the New York Times and Wall Street Journal among many other national and local media outlets. While we remain optimistic on forward booking trends, we must be cognizant of the current situation related to COVID-nineteen and how it might affect travel in the months ahead.
The underlying strength of our business in the midst of this pandemic gave us the confidence to raise $633,000,000 of equity in May. This raise allows us to act on a very active deal pipeline and resume growth capital expenditure projects such as site expansions and ground up developments. While we do not know the duration of the pandemic and its ultimate financial impact on Sun's business, We do know that Sun is in a position of strength operationally due to the high quality of our portfolio and the nature of our offerings as well as financially due to the strength of our balance sheet. It has been a challenging year thus far And I commend each and every one of our team members for going above and beyond during these past few months. Their commitment to executing on Sun's core principles has been exemplary.
John will now discuss our operating results in more detail.
Thank you, Gary. Despite the challenges presented to our business by the pandemic, we are very pleased with our performance this quarter. Quick implementation of our emergency preparedness plan, cost containment efforts and better than expected manufactured housing revenues mitigated the financial impact to quarter results. From a total portfolio perspective, we gained 851 revenue producing sites, a 27% increase over the Q2 2019, boosting total occupancy to 97.3%. Moreover, the financial hardship program implemented for April May rent is now in the 12 month installment repayment period and We are happy to report that over 17% of total deferred rent has already been collected and approximately 400 residents have paid their deferred rent in full.
Our same community portfolio demonstrated resilience in the 2nd quarter. NOI grew by 1.4% resulting from a 1.8% decline in revenues and an 8% decline in expenses due to delayed seasonal opening of a number of RV Resorts and portfolio wide measures taken at the property level to reduce variable expenses. Manufactured housing revenues increased by 6% driven by a 3.9% weighted average rental rate increase year over year and occupancy gains over the last 12 months. Annual RV revenues increased by 3.2% and transient RV revenue declined by 37% largely due to delayed openings at our resorts during the quarter as discussed previously. On the expense side, we experienced reductions across payroll and Variable expense savings realized in the 2nd quarter are expected to be lower in the second half of the year as furloughed and seasonal team members return to work And amenities that were not accessible in the Q2 due to state and local restrictions are returned to service.
Same community occupancy improved 190 basis points to 98.7 percent reflecting almost 2,300 revenue producing site gains over the last 12 months. Additionally, our rental program exhibited resilience with 17% increase in applications to rent a home from Sun and an elevated rental home renewal rate of 68.2% in the quarter. Total applications We're up almost 5% year over year. This demonstrates the continued strength of our platform and the demand to live in a Sun Community. With regard to rent collection, net of hardship deferrals and prepaid balances, manufactured housing collections averaged 97% for the 2nd quarter and are at 96% as of July 21.
These collection percentages are in line with 2019 figures as of the same dates. Additionally, over the Q2, collections averaged approximately 98% for annual RV site rent, also in line with the Q2 of 2019. These strong collection figures across the portfolio are indicative of the resilience and predictability of our balanced portfolio of manufactured housing and RV communities. Moving on to home sales. In the Q2, we sold 6 11 homes as compared to 9 27 homes last year.
Shelter in place restrictions and the inability to show homes physically contributed to the year over year decline. While pre owned home sales were down, New home sales revenues grew 15% and our gross margin expanded by 7% in the quarter driven by the sale of 140 new homes. Our average new home price increased 14% over last year to $137,000 We believe that our manufactured home price point and high quality communities are likely to make Sun a preferred provider of affordable detached housing today and in the post COVID economy. Our RV business, particularly our transient RV business has shown steady improvement week after week as travel For example, Memorial Day weekend transient RV revenues were down 39% as compared to last year, while transient RV revenues for the 4th July weekend We're down just 5.5% compared to last year. In addition, forward bookings for the month of September October are trending greater than 10% growth over the same period last year.
Gary referred to the strong projected RV sales figures and Trending media coverage surrounding the growth and demand for the RV lifestyle over the past few months. We are bullish on RV vacationing and have seen the follow through from our guests and our forward bookings. We believe that most other travel options including air travel and cruises could take longer to return to pre COVID levels. Given the breadth and high quality of the resorts we own, we are well positioned to benefit from the increasing popularity of the RV lifestyle and vacation option. We offer an excellent product and our resort performance during this challenging time reinforces the importance of this business to our overall platform.
We are resolute in our view of the long term viability of our mission and our business model. The pandemic has highlighted the importance of affordable housing and the desirability of competitively priced and safer vacation options for consumers. Sun in many ways has set the standard and we remain at the forefront of providing a quality experience to fulfill this need. I would now like to turn the call over to Karen to discuss our financial results and balance sheet preparedness.
Thank you, John. I'd like to begin by reviewing our financial results followed by a discussion of our balance sheet as well as our expectations for the Q3. For the quarter ended June 30, 2020, We reported $1.12 per share in core funds from operations as compared to $1.18 last year. The year over year change reflects the previously mentioned $10,800,000 FFO impact from COVID-nineteen, which was better than our original expectations. During and subsequent to quarter end, we acquired A manufactured home community in California with 372 developed sites and 2 RV resorts located in Oregon and Florida totaling 5 44 sites.
Our year to date acquisition volume is $132,000,000 Additionally, We sold our only Montana community for $13,000,000 In May, we closed an underwritten public offering of nearly 5,000,000 shares, netting $633,000,000 in proceeds. We intend to use the proceeds to continue to fund our growth initiatives, including acquisitions, ground up developments and expansion projects. At quarter end, we had $3,400,000,000 in debt outstanding with a weighted average interest rate of 3.86 percent and a weighted average maturity of 11.6 years. Our net debt to trailing 12 month recurring EBITDA ratio at June 30 was 4.8 times. The pandemic and its financial and operational implications continue to be a fluid situation.
While we have seen an improvement in our level of Transient RV reservations. We also recognize the recent spike in new COVID-nineteen cases may introduce Unforeseen challenges in the Q3 and beyond, which is why we will not be reinstating guidance. In addition, a number of the variable Savings realized in the Q2 will not continue for the remainder of the year as all of our communities are now open. Based on our original budget, the 3rd quarter was expected to be our biggest contributor representing approximately 31% of With the information we have available today, our forecasted reduction to original budget for the 3rd quarter is between $12,000,000 $15,000,000 This range includes expected reductions to the original budget of $9,500,000 of income from real property across manufactured housing, annual RV and transient RV $2,500,000 of net contribution from ancillary services and $2,000,000 of net contribution from home sales. It also includes $650,000 of additional expenses related to the acquisition of personal protective equipment and products for heightened cleaning protocols.
The decisive actions we have taken year to date provide Sun with meaningful financial flexibility to react to operational challenges during this time. We also believe that we are well positioned to respond opportunistically to acquisitions as they arise. Thank you for joining us today. This concludes our prepared remarks. We would like to open the call now for questions.
Operator?
Thank you. We'll now
be conducting a question and answer session. Our first question today is coming from Nick Joseph from Citigroup. Your line is now live.
Thanks. Karen, appreciate the color into 3rd quarter, for the $9,500,000 impact to the real property, can you please break that down between the MH annual RV and transient RV
Expectations? Yes, sure, Nick. As you noted, we included a range of $12,000,000 to $15,000,000 9.5 percent of it on income from property. The MH piece is due to rent increase changes, Annual RV shortened seasons and there's a small impact on transient RV that's about $1,800,000 So the difference between the $9,500,000 $8,500,000 $1,800,000 I'm sorry, you can probably split between the two Categories, MH and annual RV.
Thanks. That's helpful. And then for the acquisition pipeline, you And the equity that you raised in the Q2 and the expectation to redeploy that. So can you talk about where the pipeline is today? And then maybe just on pricing, where initial yields are now and if you've seen any change from pre COVID?
Thanks Nick. It's Gary. I would share with everyone that the pipeline is very full With a lot of attractive opportunities for Sun, inbound calls from owner operators looking to discuss Potential transactions have never been higher. We have all the relationships built over the 30 plus years, Estate planning going on, a lot of it directly driven by the pandemic and Factors related to it, where the timing is just right to open up those discussions. So we expect to Continue strong pace of acquisitions and that was the result and the driving reason for the equity offering.
Going into the year, we had discussed the target of about $150,000,000 and To date, we've closed on about $132,000,000 and second quarter and subsequent to second quarter Acquisitions closed for about $110,000,000 So we're beginning to drive up that closing rate And we expect to continue to deploy our growth capital throughout the balance of the year. We think that having access to the equity marketplace will allow us to take advantage of external growth opportunities and provide some outsized long term growth for our shareholders. When we look at cap rates, I would share with everyone on the call today, this is where I've been somewhat surprised, Having been focused on our industry, both manufactured and RV resorts, I had expected that there might be a little bit of relief on cap rates and I would share that the opposite has actually Been our experience to date. There's lots of available capital out there, Lower interest rates today and the continued recognition of the fundamentals of both manufactured housing And the RV platforms, they've continued to push on cap rates more than I would have expected in both segments. And we've seen a lot of lower quality, less well located communities, if you will, Trading in the low 4s and sometimes a touch below.
And I would To give some measure, just in the interest of trying to be as helpful and transparent as We can at Sun, we have looked at more than $500,000,000 of transactions very, very carefully, Most of which would be contenders and have not been willing to come down to the Pricing where these transactions have been going. That being said, we have acquisition pipeline That allows me to say that we will be able to put the equity to work To give you some sense of where we're thinking, the 3 properties that Kieran spoke about that we have closed On the acquisitions, we're in a range of a 4.7% cap rate up to a 6.2% cap rate range. And we will continue to be looking in that range as we move forward.
Thank you.
Thank you. Our next question is coming from Wes Golladay from RBC Capital Markets. Your line is now live.
Hey, good morning, everyone. Can you talk about what you're seeing for annual RV conversion from a demand perspective?
Sure. This is John. So So I mean I will tell you that 2020 has been as you can see with the results a bit challenging on the RV conversion standpoint. And a lot of that's because the healthy respect that we've had for social distancing and we've had to temporarily we had to temporarily Maybe not interact so much with our guests face to face, which is very much how we secure RV conversions. Many of our Southern conversions happen generally happen at the end of March, mid April and Northern conversions, most Those happen in early in June early July.
So the timing wasn't great as well. But that said, the reason why I've been so Successful converting transient, Daniel, is because guests love coming to our resort. So I think once things settle down and we get closer to normal again, That conversion activity will resume.
Okay. And then Let's see. Looking at the your sites, I think you mentioned they were all open. And just curious, is that are all the RV transient sites open to all guests? I know there were some restrictions earlier, if you had to say a certain length of period, it was open, but just want to clarify that all the RV sites are open for everybody now.
Every resort is open. We do have some sites in Ontario that are still not available for transient guests. And we've got we've just got a few communities out in California where there is some limitations as to number of transient or short term guests that can have at any given time. So we still got a little bit of that going on right now.
Got you. And last one, do you expect to start any developments later this year?
Well, we actually in the quarter, we actually added additional sites to some of the developments that we had done from ground up that we'd open up last Sure. I am excited to say that Larkspur which is in Colorado opened up their sites in the Q2 which is a big thing for us It's very well located just south of Denver and we will look to add additional site deliveries for those ground ups In phases over the course of this year and we are solidly in the ground. In fact, I just saw it myself A week ago at Costa Vista in San Diego, should be coming out of the ground early next year as far as openings concerned.
Okay. Thanks for taking the questions.
Yes.
Thank you. Our next question today is coming from Joshua Dennerlein from Bank of America. Your line is now live.
Hey, good morning, everyone. Gary, just kind of thinking big picture, Expanded unemployment benefits are likely to expire soon unless Congress enacts additional legislation. How are you thinking about MH all age occupancy Going forward, if those run out, it seems like long term probably benefit from just the affordable nature of it, but just kind of near term.
Yes, this is Gary. And then John, you can feel free to add anything in here. But I mean, I can only give you the Spective of what we have talked about for a long period of time and after being in the business for 30 plus years, I think manufactured housing is as resilient of an asset class as I've experienced In real estate, it's affordable housing. We typically share with everyone, we're not recession proof, But when we look particularly in the balance of our portfolio, it's designed intentionally With age restricted communities and all age communities because over the long period of time, We find that our growth is best with that balance. And so when you just look at the age We do get more turnover when there are very challenging periods of Economic All age.
All age, I'm sorry, all age, economic downturns, But it's more than made up by the increased desire for affordable housing. So When we look through all the various economic downturns, the great financial crisis, others, some of our strongest growth It is post those economic downturns. So again, not Recession proof, but very, very resilient and a great opportunity, I think like other unlike other asset classes to bounce back pretty strong. And then when we talk about things that we look at like bad debt, we look back 18 years, which we did recently and the range has averaged around 100 basis points, 110 basis points from a low of about 60 basis points to a high of 100 and 40 basis points annually during that 18 year period of time. And if I go back in my notes, That's pretty similar to how it goes.
So John, you might want to add some color to what you're seeing
in the quarter. Yes. The only color I'd add Gary is just that Sort of on the overwhelming side, meaning the number of people that are coming to our communities, Josh, I mean, we're already seeing it For the application counts that we've gotten for the Q2 having total laps up 5% in the midst of this quarter over quarter as well as Rental home applications being up 17% are off the street sales applications are up 22%. And Like Gary said, recession resistance is a good way to characterize it because in the end, there are going to be people that maybe are in different forms of Housing, okay, that come into our product and what we've seen over time is, yes, we lose a few people marginally from an occupancy standpoint, but we overwhelmingly offset it with the number of people that are coming into our product. That's been the experience over that period of time, the 18 years Gary is talking about.
And so it's we feel pretty optimistic about what the future holds from that respect.
And why did we choose 18 years? Because John McLaren, our Chief Operating Officer, started here 18 years ago.
Yes. From the moment he walked in the door.
I cut my teeth
Awesome. Thanks guys. And then maybe just one more for me. You mentioned I think you said 80% of the furloughed teammates have come back. Any sense of how payroll and benefits in your same community will kind of trend through 3Q like Did they were they off was that 80% fully back at the start of the quarter or that just happened recently?
No, they were pretty much backed by the start of the Q1, Josh. So we're not really expecting Any real reductions in payroll from that perspective for the Q3. Okay.
Would 1Q be a decent run rate to use for 3Q for that line item then?
Well, it's tough to say because of the seasonality. You've got 3 you've got You've got RV, which has a higher level of team members in it. So I'd have to take a look back. You'd probably follow-up with Fernando on that, Josh, but I can't make that comparison right now. Got it.
Okay. Thanks everyone.
Thank
you. Our next question is coming from John Kim from BMO Capital Markets, your line is now live.
Thanks. Good morning. I realized transient RV has picked up since the Q2, But I was wondering if you could share what the occupancy rate was for the transient RV segment in the Q2 and today versus the same periods last year?
Actually, John, unfortunately, I don't have that figure right in front of me. It's something we can follow back up with you on After the call, I
apologize for that. Okay. But in your prepared remarks, it sounded like transient RV was Trending ahead of last year excluding the July 4th weekend, is that correct?
Yes, I mean it's been I would characterize it as over the course of the quarter if I look at The revenue and what we've done between April, May June, it has consistently been picking up and that's been a result of the lifting of the Stay at home orders and those limitations that we've had and I think it speaks to what Gary said a lot many times which is The pent up demand that's out there for people to get out and we clearly see that looking at sequentially each of the months. And so Without having the actual figure, I know the occupancy is ticked up and I see that in the revenue, but we can again circle back on those figures for
This might be helpful because John, your question is a question we're studying all the time as we Look at our business platform and how we're approaching it. But one thing we've discovered when we talk about resilience that through downturns in the economy, Gas prices that have been approaching $5 a gallon, if those of you can remember that far back, I can. Swings in RV annual sales, those measures as we look back historically, Revenues have grown in our RV communities on an average of 90 to 100 basis points greater than our manufactured housing business over a 10, 15, 20 year period of time. So I think that while we're not brushing aside The impact of the pandemic fundamentally as John used the word bullish, we're Really proponents of how resilient the RV business is going to be both annual and transient As this strong demand comes back and we're seeing it both here in our portfolio and in our investment over in Australia, where it's pretty much forward reservations in Australia, which I reviewed the other day are up 24% for the forward 12 month period of time. And they struggled also through closures of their internal borders, Travelers restrictions and stay at home mandates.
So I think that We feel very, very good about how our RV transient and annual business will perform subject to The uncertainty of governmental actions and things like that as the pandemic Goes forward and we're also cognizant of the changing environment daily of what's going on with the virus.
But in your $9,500,000 reduction versus budget to real property, some of that was Transient RV, as Karen mentioned, is that purely from the July 4th weekend or are you baking in some conservatism in the back half of the quarter?
Yes. There's a little bit of conservatism there. Obviously, we don't know what's going on. That's a reduction The transient RV represents 97.8% of what our budget is. So it's Pretty small amount of conservatism there.
Okay. On the expansion front, you've delivered 8 revenue producing sites for this quarter, some of that were probably delayed in the Q1. But how close is this to a run rate quarterly figure for the rest of the year?
You mean for revenue producing sites, John? Yes.
Yes.
Well, I think that puts us For the year at roughly 11.50 plus or minus, actually 11 51 sites that we've gained year to date. So I think our original guidance was somewhere I think it was about 2,600 is what we had in original guidance. So I guess the way I'd answer that question is some of it's going to be we had a really good second quarter On the RPS front and gaining sites, it was higher than last year as we shared in the remarks. I think that some of it is just dependent upon as Gary mentioned everything is subject to what happens going forward Pandemic, but based on the application counts, it's difficult for me to give you really sort of a guidance number of what it would be At this time, but I think that, It's just I think it's still a little bit early, John, to provide that right now. But I am pleased with where we're at.
It is Close to where we were. I think it's about 100 sites shorter than where we were last year at this time. So we're in striking distance of being in the range.
Thank you.
Thank you. Our next question today is coming from John Pawlowski from Green Street Advisors, your line is now live.
Thanks. I appreciate taking the question. I wanted to circle back on the The one 110 bps average bad debt over the last 18 years and a high of, I believe $140,000,000 or $150,000,000 what you referenced there. Is that high watermark a reasonable betting line over These coming years from everything you see on the ground today, because the portfolio is better situated today just geographically and quality, but Unemployment is pretty darn high right now. So just everything you see in terms of the strain on your consumer today is that 140, 150 bps It's kind of bad debt, net bad debt numbers, a reasonable bogey.
Well, You used the word bet. We don't tend to bet a little bit. We like to be as precise as we possibly can. And it's difficult To have clarity, okay, in an environment that's pretty unprecedented. And it's scary by the way.
What I can share with you though is post 2,008, We didn't see a spike beyond that range. And For the period of time, we've been operating in that range. I think that Karen can share with you some of the metrics because we have Thought through a little bit of reserve and accruing for bad debt, but I don't think that it's anything that far out of that range.
Okay. Yes. Just as far as Gary saying that BadDot has really been on par. That being said, we with the uncertainty we have, including hardship repayments, we did conservatively 100 bps of revenue without that $2,000,000 it's 60 I think 64 bps. Okay.
With unemployment remaining elevated, is there I mean, is there a chance that you have to rein State the deferral program, are consumers coming to you or renters coming to you still asking for relief even though you've cut it or you've stopped it in June?
Yes, this is John. So we actually that we cut it off in June, but we have not had a lot of requests For the program and part of the reason why we did end it in June was because those had trailed off significantly. So I at this point in time, again, it's hard to say, but at this point in time, we don't have any expectations that we would have to reengage that program?
John, it is very fluid, but we can share with you because we do discuss this. And like all of you, we are wondering what's going to happen with the stimulus package, what's going to happen with unemployment. Bert, there is nothing that we're seeing out of what we've shared with you, where we could discuss now Some vulnerability, if you will, other than the small piece that Karen shared to be conservative. And on the unemployment side, there's nothing on collections. In fact, It was somewhat unusual for us to receive the request that we received for Prepayment in full of the rent deferral, John, what was the percentage of that?
17. 17%, whereby they had 12 months to really pay this back. So interestingly enough, it's almost as if there's some conservatism by Some of our residents who want to know, currently that they can pay back that deferral, that gives us a little bit Comfort, if you will, and how we're going to navigate these uncertain
times. I think it's also important just again kind of going back in history to look at What we shared in terms of the resilience of the business. I mean there were fairly tough times in the early 2000s that we went True, still grew. There were tough times through the global financial crisis. We still grew.
Okay. And so it's Again, it goes back to the fact of what is it we have. We have affordable vacationing. We have affordable housing. We have a product that Is needed in all economic cycles, okay.
And so it's just a matter of it doesn't to us It's resistant because it doesn't really matter what the economic cycle is. The need is always there and we're seeing that come through with our application counts and all the Other things that we shared along the way too, John.
Okay. No, I appreciate all the thoughts. Maybe just one last one for me, circling back to Nick's first question on the roughly $10,000,000 impact on real property income for the coming quarter. And I think Karen, you mentioned it's roughly half split between MH and annual RV and the other transient. So the Not increasing rents on the annual RVs or MH, is there a have you come up with a date on when you're going to start increasing rents
Again, John, one of the things that we've always said is that the most important The best revenue producing site you can gain is the one you never lose. And so we've been very thoughtful, very careful in terms of the rent increase for 2020 with the goal of doing what's right for all of Sun stakeholders. So, but we have engaged that process.
And just as a reminder, about 50% of our 2020 rent increases were in place prior to mid March. So After that sort of 3.5 month halt in raising rents, we are implementing them now. We think the adjustment To our 2020 with that adjustment to our 2020 rent increases, our weighted average MH rent increase is expected to be around 3% Rather than 4% that we'd have originally guided to by the end of the year.
Great. Thanks very much.
Yes.
Thank you. Our next question today is coming from Samir Khanal from Evercore ISI. Your line is now live.
Hi, Gary. Sorry if I missed this earlier, but what's the timing of that deployment of that $500,000,000 of equity raise? Is that more of the bulk of those acquisitions, is that more of a this year story or is it are you looking at more into 2021 and further here?
Well, generally, we don't forecast acquisition volume other than to refer to what we've done in the previous years. We're well ahead of pace of where we expected to be based on last year's acquisitions with the Exceptional of the Jensen portfolio and I would simply state with $132,000,000 closed And so far this year, we should be able to significantly exceed That with what we closed this year and if anything overlaps into next year, we'll be glad to share this. But For right now, I can only say that our pipeline is extremely full. We are very pleased that we will be able to match up The equity growth capital that we raised to the potential acquisitions and the timing is really hard to forecast.
I guess my second question is just, can you provide an update on your Australian JV and maybe address how that Business has been holding up through sort of COVID-nineteen here.
Sure. I referenced it a little bit with how similar Their RV business has been, but despite tight restrictions over in Australia and certainly within their internal borders, Ingenia really has continued to perform really well during these challenging times. Last quarter, they announced that total year to date home sales We're 240 with another 30 expected to close prior to their year end, which was June 30. So if they close those around 270 home sales should have closed. On the Sun Ingenia Development joint venture, we've been slower to deploy our capital over there than Our original goal, but we continue to wait for some delayed entitlement approvals that delayed in some part due to the COVID situation there as well.
Our first project, Freshwater in a place called Burpengary, We've closed 7 new homes generating gross proceeds about $2,500,000 Aussie dollars With an additional 15 homes under contract and deposit now, which are being constructed, Some delay again through COVID, but on track to deliver the kind of results and returns that we hope for on that development. And then I mentioned the RV, a few comments before. Similar to what we've experienced in the U. S, but looking forward, Now that everything is open, the travel restrictions have been lifted with the exception of one area, 12 month bookings are Strong and they're indicating a revenue increase year over year of just over 24%. So They're continuing to perform well.
They're getting ready to report on their year end results And I'm looking forward to seeing them as much of the market is.
Thanks for that.
Thank you. We've reached the end of our question and answer session. I'd like to turn the floor back over to Gary for any further or closing comments.
Well, we want to thank all of you for taking the time out to join Today, we believe Sun's actions in response to this unprecedented period of time, ensure that our business is Strong through and on the other side of this pandemic. So we look forward to Speaking to you at the end of next quarter. And as I always conclude, Fernando, John, myself and Karen are always available for any follow-up questions. Thank you, operator.
Thank you. That does conclude today's teleconference. You may disconnect your line at this time and have a wonderful day. We thank you for your participation today.