I. Executive Summary

This Q2 2025 Manufactured Housing Industry Report provides a concise overview of key trends and performance indicators within the manufactured housing (MH) sector, specifically tailored for Cornell Communities' accredited and high-net-worth (HNW) investors. The report highlights the sector's continued resilience and strong fundamentals, driven by persistent demand for affordable housing and strategic operational efficiencies. These insights are crucial for understanding the investment landscape and potential for passive returns in mobile home parks (MHPs).

Key Takeaways for Investors:

Robust Net Operating Income (NOI) Growth: The manufactured housing REITs demonstrated significant core NOI growth in Q2 2025. This growth is primarily attributed to effective rate management and stringent expense control. For instance, Equity Lifestyle Properties (ELS) achieved a 6.4% core NOI growth, Sun Communities (SUI) reported a 7.7% North American same-property NOI increase, and UMH Properties (UMH) saw a notable 10% year-over-year rise in sameproperty NOI. This consistent growth underscores the sector's ability to generate strong operational returns.

Stable and High Occupancy Rates: The MHP sector continues to exhibit remarkable stability in occupancy. ELS maintained over 94% portfolio-wide occupancy, with a significant 97% of residents being homeowners, which contributes to low turnover and predictable revenue streams. SUI's MH sameproperty occupancy increased to 97.6%, while UMH's same-property occupancy reached 94.4%. These figures highlight the enduring demand and stability inherent in MH communities.

Strategic Capital Deployment and Growth Opportunities: Industry leaders are actively engaged in reinvestment, new site development, and targeted acquisitions, signaling strong confidence in future growth. Despite rising development costs, substantial capital reserves (over $1 billion for some operators) are being deployed for strategic expansion. This proactive approach ensures continued value creation and portfolio optimization, aligning with Cornell Communities' long-term growth objectives.

II. Market Overview & Macroeconomic Highlights

During Q2 2025, the macroeconomic environment presented a complex picture, characterized by early signs of stabilization amidst persistent service-sector inflation. The Federal Reserve maintained high interest rates, yet capital markets showed improvement, and the bid-ask spread for assets decreased. The manufactured housing REIT sector demonstrated remarkable resilience, delivering strong NOI growth fueled by consistent rent increases, high occupancy, and successful rental conversions. This performance is largely underpinned by the fundamental demand for affordable housing. While high interest rates and inflationary pressures remain significant headwinds, long-term demand drivers—such as constrained housing affordability, favorable demographic shifts, and the essential service nature of MH communities—continue to provide robust support for the MHP sector's sustained performance.

III. Key Performance Indicators (KPIs) Analysis Q2 2025 Manufactured Housing REIT Data Overview This table provides a comparative overview of key performance indicators for leading Manufactured Housing REITs, offering benchmarks for Cornell Communities' investment analysis. Metric Year Equity Lifestyle Properties (ELS) Sun Communities (SUI) UMH Properties (UMH) Ending Occupancy (Same Store) 2025 94.30% 97.60% 88.20% 2024 94.90% 97.20% 87.70% YoY MH Rental Income Increase (Same Store) 2025 5.5% 6.9% 7.8% 2024 6.2% 7.2% 9.0% YoY MH Expense Increase (Same Store) 2025 0.0% 4.7% 4.7% 2024 3.4% 9.2% 6.1% YoY MH NOI Increase (Same Store) 2025 6.4% 7.7% 9.9% 2024 5.5% 6.4% 11.0% Rent Per Site (Same Store) 2025 730 $557 2024 692 $534 MH Acquisitions 0 0 0 Total MH Sites 73,220 97,380 26,821 904∣ 854∣ Manufactured Housing Rental Rates Rental rate growth in the MH sector remains a significant driver of income. ELS reported a 5.8% rate growth in its MH portfolio during Q2 2025, primarily due to increases for renewing residents and higher market rents for new residents after turnover. The core MH base rent growth for ELS is projected to be between 4.9% and 5.9% for the full year. Sun Communities (SUI) also reported strong rent growth, which was a key factor in its 7.7% same-property NOI growth. UMH Properties experienced an 8% year-over-year increase in same-property rental income, a direct result of successful rent increases and improved occupancy rates. These trends underscore the sector's ability to generate consistent and growing rental income. Manufactured Housing Occupancy High and stable occupancy is a hallmark of the MH sector, contributing to its predictable cash flows. ELS maintained robust MH occupancy above 94% across its portfolio, with an impressive 97% of residents being homeowners and an average resident tenure of 10 years. This high homeowner rate and long tenure significantly reduce turnover and enhance community stability. SUI's MH same-property occupancy saw a 40 basis point increase year-over-year, reaching 97.6% in Q2. UMH also demonstrated strong performance, increasing same-property occupancy by 76 units sequentially and 251 units year-over-year, with rental home occupancy at 94.4%. These figures reflect the strong demand and sticky nature of MH communities. Manufactured Housing Income & Expenses Effective management of income and expenses is critical for maximizing NOI. ELS delivered a 6.4% core portfolio NOI growth in Q2, exceeding guidance by 70 basis points. Core community-based rental income for ELS rose 5.5% for both Q2 and yearto-date, with utility and other income increasing by 4.4% year-to-date. Notably, ELS's core operating expenses remained flat year-over-year in Q2, reflecting successful cost control measures. SUI achieved a 4.9% North American same-property NOI growth, primarily driven by its MH portfolio. UMH's total Q2 revenue increased to 60.3 million last year), with rental and related income rising 9% and sales income up 19%. UMH's same-property NOI increased 10% year-over-year to $34 million, and its operating expense ratio improved to 38.2% from 39.4%, indicating enhanced operational efficiency. 66.6million(upfrom IV. Investment & Transaction Activity Investment activity in the manufactured housing sector remains dynamic, reflecting its attractiveness to investors. ELS continued its strategic investment in new home inventory, selling nearly 700 new homes in Tampa-St. Pete and 800 in Phoenix/Mesa over the past five years, alongside delivering 1,500 MH sites and 2,900 RV sites. Sun Communities (SUI) strategically divested its Safe Harbor Marinas to refocus on its core MH and RV communities. UMH refinanced 10 communities for 164 million, demonstrating significant value creation. UMH also expanded its portfolio by acquiring four communities totaling 457 sites for $39 million year-to-date. These activities underscore the ongoing capital deployment and strategic growth within the sector, presenting ample opportunities for Cornell Communities. Manufactured Housing Cap Rates & Bid-Ask Spread Cap rates and the bid-ask spread are critical indicators for MHP valuations. ELS reported current secured debt terms for 10-year loans at 5.25%–6% interest, with favorable loan-to-value (LTV) ratios of 60%–75% and debt service coverage ratios (DSCR) of 1.4x–1.6x. These terms are available for high-quality, age-qualified MH assets, indicating a healthy financing environment. UMH’s Q2 refinancing implied substantial value creation, with a 82,000 per site in appraisals. While SUI did not disclose specific cap rates, their continued pursuit of acquisitions with strong supply-demand dynamics and strategic fit within their MH portfolio suggests a favorable outlook on valuations. V. Outlook & Strategic Implications for Cornell Communities The Q2 2025 report strongly reinforces the robust fundamentals and positive trajectory of the manufactured housing sector. Despite prevailing macroeconomic headwinds, the industry's demonstrated resilience—evidenced by consistent NOI growth, high occupancy rates, and strategic capital deployment—aligns perfectly with Cornell Communities' core mission. This mission focuses on providing affordable housing solutions while simultaneously delivering strong, passive returns to our Limited Partners (LPs). The sustained demand for affordable housing, coupled with the 101.4millionata5.855 97million(146 inherent operational stability and significant growth opportunities within the sector, creates a compelling investment environment for value-add Mobile Home Park acquisitions. Cornell Communities can strategically leverage these market insights to further refine its acquisition criteria, enhance investor communications through transparent and educational content, and optimize capital deployment to achieve its ambitious goal of scaling Assets Under Management (AUM) and attracting a broader base of accredited and HNW investors. References [1] SkyView Advisors. (2025). Q2 2025 Manufactured Housing Industry Report. Retrieved from https://skyviewadvisors.com/q2-2025-manufactured-housing-industryrepor