ELS Reports Third Quarter Results

Equity LifeStyle Properties, Inc. (NYSE: ELS) (the "Company”) today announced results for the quarter and nine months ended September 30, 2009.

a) Financial Results

For the third quarter 2009, Funds From Operations ("FFO”) were $28.8 million, or $0.82 per share on a fully-diluted basis, compared to $22.7 million, or $0.74 per share on a fully-diluted basis for the same period in 2008. For the nine months ended September 30, 2009, FFO was $90.4 million, or $2.81 per share on a fully-diluted basis, compared to $77.1 million, or $2.53 per share on a fully-diluted basis for the same period in 2008.

Net income available to common stockholders totaled $11.1 million, or $0.37 per share on a fully-diluted basis for the quarter ended September 30, 2009. This compares to net income available to common stockholders of $1.5 million, or $0.06 per share on a fully-diluted basis for the same period in 2008. Net income available to common stockholders totaled $27.7 million, or $1.02 per share on a fully-diluted basis for the nine months ended September 30, 2009. This compares to net income available to common stockholders of $18.3 million, or $0.74 per share on a fully-diluted basis for the same period in 2008.

On June 29, 2009, the Company issued 4.6 million shares of common stock in an equity offering for approximately $146.4 million, net of offering costs. On an as adjusted basis, assuming the equity offering had not occurred, FFO per share on a fully-diluted basis would have been $0.94 and $3.28 for the quarter and nine months ended September 30, 2009, respectively. As adjusted net income available to common stockholders, assuming the equity offering did not occur, would have been $0.42 and $1.19 per share on a fully diluted basis for the quarter and nine months ended September 30, 2009, respectively.

See the attachment to this press release for reconciliation of FFO and FFO per share to net income available to common shares and net income per common share, respectively, the most directly comparable GAAP measure.

b) Portfolio Performance

Third quarter 2009 property operating revenues were $123.8 million, compared to $108.3 million in the third quarter of 2008. Our property operating revenues for the nine months ended September 30, 2009 were $364.3 million, compared to $309.0 million for the nine months ended September 30, 2008.

For the quarter ended September 30, 2009, our Core property operating revenues increased approximately 2.7 percent and Core property operating expenses decreased approximately 1.5 percent, resulting in an increase of approximately 6.5 percent to income from Core property operations over the quarter ended September 30, 2008. For the nine months ended September 30, 2009, our Core property operating revenues increased approximately 2.7 percent and Core property operating expenses decreased approximately 1.6 percent, resulting in an increase to income from Core property operations of approximately 6.3 percent over the nine months ended September 30, 2008.

For the quarter ended September 30, 2009, the Company had 38 new home sales (including 13 third-party dealer sales), which represents a 56.3 percent decrease as compared to the quarter ended September 30, 2008. Gross revenues from home sales were $2.1 million for the quarter ended September 30, 2009, compared to $5.3 million for the quarter ended September 30, 2008. Net income from home sales and other was $1.5 million for the quarter ended September 30, 2009, compared to a net loss from home sales and other of ($0.7) million for the same period in 2008. For the nine months ended September 30, 2009, the Company had 79 new home sales (including 19 third-party dealer sales), a 75.5 percent decrease over the same period in 2008. Gross revenues from home sales were $5.1 million for the nine months ended September 30, 2009, compared to $18.3 million for the same period in 2008. Net income from home sales and other was $1.0 million for the nine months ended September 30, 2009 compared to a net loss from home sales and other of ($2.7) million for the nine months ended September 30, 2008.

Property management expenses were $8.7 million for the quarter ended September 30, 2009, compared to $6.4 million for the same period last year. A significant portion of the increase in property management expenses was due to the acquisition and consolidation of Privileged Access, L.P. ("Privileged Access”) and the 82 Company properties that Privileged Access had been leasing and operating prior to the Company’s acquisition of Privileged Access on August 14, 2008.

c) Asset-related Transactions

On July 20, 2009, the Company sold the 490-site property known as Casa Village in Billings, Montana. The buyer assumed approximately $10.6 million of mortgage indebtedness on the property.

d) Balance Sheet

Our average long-term secured debt balance was approximately $1.6 billion in the quarter, with a weighted average interest rate, including amortization, of approximately 6.02 percent per annum. Our unsecured debt balance currently has an availability of $370.0 million. Interest coverage was approximately 2.4 times in the quarter ended September 30, 2009.

During the quarter ended September 30, 2009, the Company closed on approximately $21.1 million of financings on two manufactured home properties with a weighted average interest rate of 6.25 percent per annum, maturing in 2019. The Company also paid off twelve maturing mortgages totaling approximately $47.9 million, with a weighted average interest rate of 7.94 percent per annum.

During the fourth quarter of 2009 and the second quarter of 2010, the Company expects to close on approximately $74 million of financing on four manufactured home properties at a weighted average interest rate of 6.96 percent per annum, maturing in 10 years. We have locked rate with Fannie Mae on these loans. There can be no assurance if such financings will occur or as to the timing and terms of our anticipated financing.

The Company expects to satisfy its secured debt maturities occurring prior to December 31, 2010 with the proceeds from the four financings noted above and its existing cash balance, which is approximately $160 million as of September 30, 2009. The expected timing and amounts of the most significant payoffs are as follows: i) approximately $32 million during the fourth quarter of 2009, ii) approximately $100 million in April of 2010, and iii) approximately $76 million in August of 2010.

e) Guidance

ELS management projects 2009 FFO per share, on a fully-diluted basis, to be in the range of $0.60 to $0.70 for the quarter ending December 31, 2009.

Preliminary guidance for 2010 FFO per share, on a fully-diluted basis, is projected to be in the range of $3.39 to $3.59 and is based on the following assumptions provided below. The following are based on current projections, make no assumptions regarding free cash flow and are forward-looking:

• Core property operating revenue for 2010 is expected to grow at approximately 1.0 to 1.5 percent over 2009, assuming stable occupancy. The 2010 Core properties are expected to earn approximately $493.5 million in property operating revenues in 2009. The 2010 Core properties will include the 82 Privileged Access properties the Company started operating on August 14, 2008.
• Income from Core property operations, excluding property management expenses, is expected to grow at approximately 1.0 to 2.0 percent over 2009. Excluding property management expenses, the 2010 Core properties are expected to contribute approximately $268.5 million to income from property operations in 2009.
• Non-Core properties are expected to contribute approximately $1.8 million to income from property operations in 2010.
• Property management and corporate general and administrative expenses are expected to be approximately $55 million in 2010.
• Other income, including sales operations, interest income, other corporate income and depreciation, rent control initiatives and income from joint ventures (before related depreciation expense), is expected to be approximately $11 million in 2010.
• Interest and related amortization expense and payments to perpetual preferred OP Unit holders is expected to be approximately $107 million in 2010.

The Company's guidance ranges acknowledge the existence of volatile economic conditions, which may impact our current guidance assumptions. Factors impacting 2009 and 2010 guidance include (i) the mix of site usage within the portfolio; (ii) yield management on our short-term resort sites; (iii) scheduled or implemented rate increases on community and resort sites; (iv) scheduled or implemented rate increases of annual payments under right-to-use contracts; (v) occupancy changes; and (vi) our ability to retain and attract customers renewing or purchasing right-to-use contracts. Results for 2009 and 2010 also may be impacted by, among other things, (i) continued competitive housing options and new home sales initiatives impacting occupancy levels at certain properties; (ii) variability in income from home sales operations, including anticipated expansion projects; (iii) potential effects of uncontrollable factors such as environmental remediation costs and hurricanes; (iv) potential acquisitions, investments and dispositions; (v) mortgage debt maturing during 2010; (vi) changes in interest rates; and (vii) continued initiatives regarding rent control legislation in California and related legal fees. Quarter-to-quarter results during the year are impacted by the seasonality at certain of the properties.

Equity LifeStyle Properties, Inc. owns or has an interest in 307 quality properties in 27 states and British Columbia consisting of 110,363 sites. The Company is a self-administered, self-managed, real estate investment trust (REIT) with headquarters in Chicago.

A live webcast of Equity LifeStyle Properties, Inc.’s conference call discussing these results will be available via the Company’s website in the Investor Info section at www.equitylifestyle.com at 10:00 a.m. Central time on October 20, 2009.

This news release includes certain "forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. When used, words such as "anticipate,” "expect,” "believe,” "project,” "intend,” "may be” and "will be” and similar words or phrases, or the negative thereof, unless the context requires otherwise, are intended to identify forward-looking statements. These forward-looking statements are subject to numerous assumptions, risks and uncertainties, including, but not limited to:

• our ability to control costs, real estate market conditions, the actual rate of decline in customers, the actual use of sites by customers and our success in acquiring new customers at our Properties (including those recently acquired);
• our ability to maintain historical rental rates and occupancy with respect to Properties currently owned or that we may acquire;
• our assumptions about rental and home sales markets;
• in the age-qualified Properties, home sales results could be impacted by the ability of potential homebuyers to sell their existing residences as well as by financial, credit and capital markets volatility;
• in the all-age Properties, results from home sales and occupancy will continue to be impacted by local economic conditions, lack of affordable manufactured home financing and competition from alternative housing options including site-built single-family housing;
• the completion of future acquisitions, if any, and timing with respect thereto and the effective integration and successful realization of cost savings;
• ability to obtain financing or refinance existing debt on favorable terms or at all;
• the effect of interest rates;
• the dilutive effects of issuing additional common stock;
• the effect of accounting for the sale of agreements to customers representing a right-to-use the Properties previously leased by Privileged Access under Financial Accounting Standards Board Accounting Standards Codification Topic "Revenue Recognition” (prior authoritative guidance: Staff Accounting Bulletin No. 104, Revenue Recognition in Consolidated Financial Statements, Corrected); and
• other risks indicated from time to time in our filings with the Securities and Exchange Commission.

These forward-looking statements are based on management’s present expectations and beliefs about future events. As with any projection or forecast, these statements are inherently susceptible to uncertainty and changes in circumstances. The Company is under no obligation to, and expressly disclaims any obligation to, update or alter its forward-looking statements whether as a result of such changes, new information, subsequent events or otherwise.

Tables follow:

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Non-GAAP Financial Measures

Funds from Operations ("FFO”), is a non-GAAP financial measure. The Company believes that FFO, as defined by the Board of Governors of the National Association of Real Estate Investment Trusts ("NAREIT”), is generally an appropriate measure of performance for an equity REIT. While FFO is a relevant and widely used measure of operating performance for equity REITs, it does not represent cash flow from operations or net income as defined by GAAP, and it should not be considered as an alternative to these indicators in evaluating liquidity or operating performance.

We define FFO as net income, computed in accordance with GAAP, excluding gains or actual or estimated losses from sales of properties, plus real estate related depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures are calculated to reflect FFO on the same basis. The Company receives up-front non-refundable payments from the sale of right-to-use contracts. In accordance with GAAP, the upfront non-refundable payments and related commissions are deferred and amortized over the estimated customer life. Although the NAREIT definition of FFO does not address the treatment of nonrefundable right-to-use payments, the Company believes that it is appropriate to adjust for the impact of the deferral activity in our calculation of FFO. The Company believes that FFO is helpful to investors as one of several measures of the performance of an equity REIT. The Company further believes that by excluding the effect of depreciation, amortization and gains or actual or estimated losses from sales of real estate, all of which are based on historical costs and which may be of limited relevance in evaluating current performance, FFO can facilitate comparisons of operating performance between periods and among other equity REITs. The Company believes that the adjustment to FFO for the net revenue deferral of upfront non-refundable payments and expense deferral of right-to-use contract commissions also facilitates the comparison to other equity REITs. Investors should review FFO, along with GAAP net income and cash flow from operating activities, investing activities and financing activities, when evaluating an equity REIT’s operating performance. The Company computes FFO in accordance with our interpretation of standards established by NAREIT, which may not be comparable to FFO reported by other REITs that do not define the term in accordance with the current NAREIT definition or that interpret the current NAREIT definition differently than we do. Funds available for distribution ("FAD”) is a non-GAAP financial measure. FAD is defined as FFO less non-revenue producing capital expenditures. Investors should review FFO and FAD, along with GAAP net income and cash flow from operating activities, investing activities and financing activities, when evaluating an equity REIT’s operating performance. FFO and FAD do not represent cash generated from operating activities in accordance with GAAP, nor do they represent cash available to pay distributions and should not be considered as an alternative to net income, determined in accordance with GAAP, as an indication of our financial performance, or to cash flow from operating activities, determined in accordance with GAAP, as a measure of our liquidity, nor is it indicative of funds available to fund our cash needs, including our ability to make cash distributions.