Sun Communities’ $1.28 Billion Shares Offering

Paul Hastings LLP advised Citigroup, BofA Securities, BMO Capital Markets, J.P. Morgan and RBC Capital Markets as joint book-running managers on the deal. Goodwin Procter LLP advised Sun Communities on the deal.

Citigroup, BofA Securities, BMO Capital Markets, J.P. Morgan and RBC Capital Markets acted as joint book-running managers for Sun Communities, Inc.’s (NYSE: SUI) $1.28 billion public offering of common stock in connection with the forward sale agreements described below.  Sun Communities, Inc., a real estate investment trust that owns and operates or has an interest in manufactured housing and recreational vehicle communities, sold a total of 9,200,000 shares of common stock (including the full exercise of the underwriters’ option to purchase additional shares) at a public offering price of $139.50 per share.

In connection with the offering, Sun Communities entered into forward sale agreements with Citibank, N.A., as forward purchaser, pursuant to which the forward purchaser or its affiliates borrowed and sold to the underwriters an aggregate of 9,200,000 shares of common stock that were delivered in the offering. Subject to Sun Communities’ right to elect cash or net share settlement, which right is subject to certain conditions, the company intends to deliver, upon physical settlement of such forward sale agreements on one or more dates occurring no later than October 5, 2021, an aggregate of 9,200,000 shares of its common stock to the forward purchaser in exchange for cash proceeds per share equal to the applicable forward sale price, which is the public offering price, less underwriting discounts and commissions, and is subject to certain adjustments as provided in the forward sale agreements.

Sun Communities will not initially receive any proceeds from the sale of shares of its common stock by the forward purchaser or its affiliates in the offering. Sun Communities intends to use the net proceeds, if any, received upon the future settlement of the forward sale agreements to fund a portion of the purchase price for its proposed $2.1 billion acquisition of Safe Harbor Marinas, LLC, the largest owner and operator of marinas in the United States.

Co-managers in the offering included BTIG, Citizens Capital Markets, Fifth Third Securities, PNC Capital Markets LLC, Regions Securities LLC, Truist Securities, Wells Fargo Securities, Baird, Ramirez & Co., Inc. and Siebert Williams Shank.

Securities & Capital Markets partner Yariv Katz (Picture) and Derivatives partner Joyce Sophia Xu led the Paul Hastings team, which also included of counsel Diona Park and Joshua Dill and associates Shai Vander and Bianca Lazar.

The Goodwin team was led by John Servidio, Benjamin Drai and Evyn Rabinowitz.

Involved fees earner: Benjamin Drai – Goodwin Procter; Evyn Rabinowitz – Goodwin Procter; John Servidio – Goodwin Procter; Joshua Dill – Paul Hastings; Yariv Katz – Paul Hastings; Diona Park – Paul Hastings; Shai Vander – Paul Hastings; Joyce Sophia Xu – Paul Hastings;

Law Firms: Goodwin Procter; Paul Hastings;

Clients: Bank of America Securities; BMO Capital Markets; Citigroup Global Markets Ltd; J.P. Morgan Securities LLC; RBC Capital Markets; Sun Communities, Inc.;

Author: Ambrogio Visconti