Equity LifeStyle Properties, Inc. (NYSE:ELS) (referred to herein as “we,” “us,” and “our”) announces that on April 14, 2014, a jury in the California Superior Court for Santa Clara County, Case No. 109CV140751, entered a verdict in the total amount of $15.3 million against our operating partnership in favor of certain plaintiffs who are current or former residents of our California Hawaiian manufactured home property located in San Jose, California (the "Property").
The Property is subject to California’s extensive regulations for mobilehome parks as well as the City of San Jose’s mobilehome rent control ordinance. The plaintiffs, whose sites comprise only approximately 10% of the Property's total number of sites, asserted that we had failed to maintain the physical improvements in the Property’s common facilities in good working order and condition. Approximately 75% of the jury award was for emotional distress damages.
The verdict included a finding that punitive damages may be awarded. An additional hearing will be held to determine the amount of punitive damages, if any.
Marguerite Nader, our Chief Executive Officer, commented: “This Property is a well-located, 100% occupied, institutional quality asset that received the Manufactured Housing Institute’s Community of the Year award in 2012. We disagree with the verdict and will vigorously seek to overturn it in the trial court or on appeal.”This press 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 and may include, without limitation, information regarding our expectations, goals or intentions regarding the future, and the expected effect of our recent acquisitions. 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 that we may acquire);
- our ability to maintain historical or increase future rental rates and occupancy with respect to properties currently owned or that we may acquire;
- our ability to retain and attract customers renewing, upgrading and entering right-to-use contracts;
- our assumptions about rental and home sales markets;
- our assumptions and guidance concerning 2014 estimated net income, FFO and Normalized FFO;
- our ability to manage counterparty risk;
- 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;
- 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;
- impact of government intervention to stabilize site-built single family housing and not manufactured housing;
- effective integration of recent acquisitions and our estimates regarding the future performance of recent acquisitions;
- the completion of transactions in their entirety and future transactions, if any, and timing and effective integration with respect thereto;
- unanticipated costs or unforeseen liabilities associated with recent acquisitions;
- 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 securities;
- the effect of accounting for the entry of contracts with customers representing a right-to-use the Properties under the Codification Topic “ Revenue Recognition;” and
- other risks indicated from time to time in our filings with the Securities and Exchange Commission.