Equity LifeStyle Properties, Inc. (NYSE: ELS) today announced the
acquisition of substantially all of the assets and certain liabilities
of Privileged Access, LP ("Privileged Access”)
for a note payable of $2.0 million. Privileged Access is an RV and
vacation membership business with approximately 130,000 members, which
leased approximately 24,300 sites at 82 of the Company’s
properties. The $2.0 million unsecured note payable matures on August
14, 2010 and accrues interest at 10 percent per annum. The Company
received a fairness opinion regarding the terms of the transaction.
Concurrent with the acquisition, all leases between Privileged Access
and the Company were terminated and the operations of Privileged Access
will be included in the Company’s financial
results.
The Company will provide additional guidance as to the impact of this
transaction on its business in the third quarter 2008 earnings press
release and related conference call. As a result of the acquisition,
nonrefundable up front payments from the sale of membership or
right-to-use contracts will be deferred and recognized as revenue in
subsequent years in accordance with generally accepted accounting
principles. These non-cash deferral adjustments may have a significant
negative impact on reported net income, although there is expected to be
no material impact on funds from operations.
Equity LifeStyle Properties, Inc. owns or has an interest in 309 quality
properties in 28 states and British Columbia consisting of 111,997
sites. The Company is a self-administered, self-managed, real estate
investment trust (REIT) with headquarters in Chicago.
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:
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 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;
our ability to maintain rental rates and occupancy with respect to
properties currently owned or pending acquisitions;
our assumptions about rental and home sales markets;
the completion of pending acquisitions and timing with respect thereto;
ability to obtain financing or refinance existing debt;
the effect of interest rates;
whether we will consolidate Privileged Access and the effects on our
financials if we do so; 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.
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