Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2023 | May 01, 2023 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Mar. 31, 2023 | |
Entity File Number | 1-12879 | |
Entity Registrant Name | INDUS REALTY TRUST, INC. | |
Entity Incorporation, State or Country Code | MD | |
Entity Tax Identification Number | 06-0868496 | |
Entity Address, Address Line One | 641 Lexington Avenue | |
Entity Address, City or Town | New York | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 10022 | |
City Area Code | 212 | |
Local Phone Number | 218-7910 | |
Title of 12(b) Security | Common Stock, $0.01 par value per share | |
Trading Symbol | INDT | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 10,197,968 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Entity Central Index Key | 0001037390 | |
Amendment Flag | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
ASSETS | ||
Real estate assets at cost, net | $ 517,813 | $ 489,661 |
Cash and cash equivalents | 23,323 | 52,014 |
Restricted cash | 450 | 358 |
Interest rate swap assets | 4,504 | 6,971 |
Assets of discontinued operations | 29 | |
Other assets | 45,031 | 47,774 |
Total assets | 591,121 | 596,807 |
LIABILITIES AND STOCKHOLDERS' EQUITY | ||
Mortgage loans, net of debt issuance costs | 79,125 | 79,653 |
Delayed draw term loan, net of debt issuance costs | 88,787 | 88,713 |
Deferred revenue | 6,332 | 6,741 |
Accounts payable and accrued liabilities | 15,115 | 10,940 |
Dividends payable | 1,835 | 1,835 |
Liabilities of discontinued operations | 119 | |
Other liabilities | 12,267 | 11,537 |
Total liabilities | 203,461 | 199,538 |
Stockholders' Equity | ||
Common stock, par value $0.01 per share, 50,000,000 shares authorized, 10,195,206 and 10,192,416 shares issued and outstanding, respectively | 102 | 102 |
Additional paid-in capital | 401,840 | 401,370 |
Accumulated deficit | (19,098) | (11,486) |
Accumulated other comprehensive income | 4,816 | 7,283 |
Total stockholders' equity | 387,660 | 397,269 |
Total liabilities and stockholders' equity | $ 591,121 | $ 596,807 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2023 | Dec. 31, 2022 |
Consolidated Balance Sheets | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares issued | 10,195,206 | 10,192,416 |
Common stock, shares outstanding | 10,195,206 | 10,192,416 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Consolidated Statements of Operations | ||
Rental revenue | $ 13,570 | $ 11,318 |
Operating expenses of rental properties | 1,213 | 1,098 |
Real estate taxes | 1,842 | 1,477 |
Depreciation and amortization expense | 5,110 | 4,156 |
General and administrative expenses | 9,552 | 2,934 |
Total expenses | 17,717 | 9,665 |
Interest expense | (1,759) | (1,519) |
Investment and other income | 130 | 21 |
Other expense | (1) | (3) |
Total other income (expense) | (1,630) | (1,501) |
(Loss) income from continuing operations | (5,777) | 152 |
Discontinued operations: | ||
Gain on sale of properties and equipment | 203 | |
Loss from discontinued operations | (86) | (86) |
Income from discontinued operations | 117 | |
Net (loss) income | $ (5,777) | $ 269 |
(Loss) income per Common Share-Basic: | ||
(Loss) income from continuing operations | $ (0.57) | $ 0.02 |
Income from discontinued operations | 0.01 | |
Net (loss) income per common share | (0.57) | 0.03 |
(Loss) income per Common Share-Diluted: | ||
(Loss) income from continuing operations | (0.57) | 0.02 |
Income from discontinued operations | 0.01 | |
Net (loss) income per common share | $ (0.57) | $ 0.03 |
Weighted average shares outstanding - basic | 10,194 | 10,185 |
Weighted average shares outstanding - diluted | 10,194 | 10,421 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Consolidated Statements of Comprehensive Income | ||
Net (loss) income | $ (5,777) | $ 269 |
Other comprehensive (loss) income: | ||
Reclassifications included in net income | 522 | 451 |
Unrealized (loss) gain on cash flow hedges | (2,989) | 4,211 |
Total other comprehensive (loss) income | (2,467) | 4,662 |
Total comprehensive (loss) income | $ (8,244) | $ 4,931 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Total |
Balance at beginning of period at Dec. 31, 2021 | $ 102 | $ 399,754 | $ (10,869) | $ (2,910) | $ 386,077 |
Balance (in shares) at Dec. 31, 2021 | 10,183,730 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Equity awards issued (in shares) | 2,698 | ||||
Stock-based compensation expense | 273 | 273 | |||
Shares acquired to satisfy employee tax withholding requirements on stock awards | (23) | (23) | |||
Shares acquired to satisfy employee tax withholding requirements on stock awards (in shares) | (285) | ||||
Common stock dividends | (1,630) | (1,630) | |||
Net (loss) income | 269 | 269 | |||
Other comprehensive income (loss) | 4,662 | 4,662 | |||
Balance at end of period at Mar. 31, 2022 | $ 102 | 400,004 | (12,230) | 1,752 | 389,628 |
Balance (in shares) at Mar. 31, 2022 | 10,186,143 | ||||
Balance at beginning of period at Dec. 31, 2022 | $ 102 | 401,370 | (11,486) | 7,283 | 397,269 |
Balance (in shares) at Dec. 31, 2022 | 10,192,416 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Equity awards issued (in shares) | 3,278 | ||||
Stock-based compensation expense | 503 | 503 | |||
Shares acquired to satisfy employee tax withholding requirements on stock awards | (33) | (33) | |||
Shares acquired to satisfy employee tax withholding requirements on stock awards (in shares) | (488) | ||||
Common stock dividends | (1,835) | (1,835) | |||
Net (loss) income | (5,777) | (5,777) | |||
Other comprehensive income (loss) | (2,467) | (2,467) | |||
Balance at end of period at Mar. 31, 2023 | $ 102 | $ 401,840 | $ (19,098) | $ 4,816 | $ 387,660 |
Balance (in shares) at Mar. 31, 2023 | 10,195,206 |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Stockholders' Equity (Parenthetical) - $ / shares | 3 Months Ended | |||
Apr. 14, 2023 | Apr. 15, 2022 | Mar. 31, 2023 | Mar. 31, 2022 | |
Consolidated Statements of Changes in Stockholders' Equity | ||||
Common dividend per share (in dollars per share) | $ 0.18 | $ 0.16 | $ 0.18 | $ 0.16 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Operating activities: | ||
Net (loss) income | $ (5,777) | $ 269 |
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||
Depreciation and amortization | 5,110 | 4,396 |
Noncash rental revenue including straight-line rents | (724) | (983) |
Stock-based compensation expense | 503 | 273 |
Amortization of debt issuance costs | 181 | 228 |
Gain on sales of equipment | (203) | |
Changes in assets and liabilities: | ||
Other assets | 1,531 | 1,051 |
Accounts payable and accrued liabilities | 2,088 | (225) |
Deferred revenue | (52) | (600) |
Other liabilities | 826 | (239) |
Net cash provided by operating activities | 3,686 | 3,967 |
Investing activities: | ||
Acquisitions of land and buildings | (19,179) | (24,026) |
Additions to real estate assets | (11,047) | (8,675) |
Deposits on building and land acquisitions | 500 | (3,375) |
Deferred leasing costs and other | (148) | (20) |
Proceeds from sale of equipment, net of expenses | 250 | |
Net cash used in investing activities | (29,874) | (35,846) |
Financing activities: | ||
Dividends paid to stockholders | (1,835) | (1,629) |
Principal payments on mortgage loans | (565) | (1,076) |
Payment of debt issuance costs | (11) | |
Proceeds from construction loan | 69 | |
Net cash used in financing activities | (2,411) | (2,636) |
Net decrease in cash and cash equivalents and restricted cash | (28,599) | (34,515) |
Cash and cash equivalents and restricted cash at beginning of period | 52,372 | 160,907 |
Cash and cash equivalents and restricted cash at end of period | $ 23,773 | $ 126,392 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2023 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | 1. Summary of Significant Accounting Policies Proposed Merger On February 22, 2023, INDUS, IR Parent, LLC, a Delaware limited liability company (“Parent”), and IR Merger Sub II, Inc., a Maryland corporation and a wholly-owned subsidiary of Parent (“Merger Sub” and, together with Parent, the “Parent Parties”), entered into an Agreement and Plan of Merger (the “Merger Agreement”). The Merger Agreement provides that, upon the terms and subject to the conditions set forth therein, Merger Sub will be merged with and into INDUS (the “Merger”). Upon completion of the Merger, INDUS will survive as a wholly-owned subsidiary of Parent (the “Surviving Entity”) and the separate corporate existence of Merger Sub will cease, and INDUS will cease to be a publicly traded company on the Nasdaq Stock Market LLC. At the effective time of the Merger (the “Effective Time”), each share of INDUS common stock that is issued and outstanding immediately prior to the Effective Time (other than shares held by the Parent Parties), will be automatically converted into the right to receive $67.00 in cash, without interest (the “Merger Consideration”). The Merger Consideration will also be increased by an amount per share of INDUS common stock, in cash (rounded to the nearest whole cent), if any, equal to the sum of (1) the cash amount per share of INDUS common stock equal to the most recently declared regular quarterly cash dividend of INDUS permitted by the terms of the Merger Agreement as of the date prior to the closing date of the Merger (the “Closing Date” and such dividend, the “Final Dividend”), if the record date for the Final Dividend is after the closing of the Merger, plus (2)(A) the cash amount per share of INDUS common stock equal to the Final Dividend, multiplied by (B) the number of days between the first day following the end of the quarterly period for which the Final Dividend was declared, if any, and the day prior to the Closing Date, divided by (C) 90, rounded to the nearest whole cent, without duplication for any period. The Merger Agreement contains customary representations, warranties and covenants, including, among others, covenants by INDUS to conduct its business in the ordinary course consistent with past practice, subject to certain exceptions, during the period between the execution of the Merger Agreement and the consummation of the Merger. The Merger Agreement also requires INDUS to convene and hold a stockholders’ meeting for the purpose of obtaining the Stockholder Approval (as defined in the Merger Agreement). The stockholders’ meeting is scheduled for May 17, 2023. The closing of the Merger is subject to customary closing conditions, including, among others, (i) the approval of the Merger by the affirmative vote of the holders of a majority of the outstanding shares of INDUS common stock entitled to vote on the Merger; (ii) the clearance by the Committee on Foreign Investment in the United States and (iii) the approval by the European Commission under Council Regulation (EC) No. 139/2004 (as amended). The closing of the Merger is not subject to a financing condition. There can be no assurances that the Merger will close on the anticipated timeline, or at all. Basis of Presentation INDUS Realty Trust, Inc., a Maryland corporation, (“INDUS” or the “Company”) is a real estate business principally engaged in developing, acquiring, managing and leasing high-quality industrial and logistics properties in select supply-constrained markets in the United States. The Company conducts substantially all of its business through its operating partnership, INDUS RT, LP, a Maryland limited partnership (the “Operating Partnership”). The Company is the sole general partner of the Operating Partnership. As used herein, the “Company” refers to INDUS Realty Trust, Inc. and its consolidated subsidiaries and partnerships, including the Operating Partnership, except where context otherwise requires. INDUS manages its operations on an aggregated, single segment basis for purposes of assessing performance and making operating decisions and, accordingly, has only one reporting and operating segment. As of March 31, 2023, INDUS owned 42 industrial/logistics properties aggregating approximately 6.1 million square feet located in Connecticut, Pennsylvania, North Carolina, South Carolina and Florida. INDUS seeks to add to its property portfolio through the development of land or the acquisition of modern, market-appropriate logistics buildings which can serve multiple drivers of demand in the modern supply chain in the markets it targets. INDUS also owns undeveloped land parcels, much of which is not consistent with the Company’s core industrial and logistics strategy, and, therefore, the Company sells certain non-core properties periodically over time. The results of operations for the three months ended March 31, 2023 are not necessarily indicative of the results to be expected for the full year. Certain amounts from the prior year period have been reclassified to conform to the current presentation. These financial statements have been prepared in conformity with the standards of accounting measurement set forth by the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 270, “Interim Reporting” and in accordance with the accounting policies stated in INDUS’ audited consolidated financial statements for the year ended December 31, 2022 included in INDUS’ Annual Report on Form 10-K, filed with the SEC on March 6, 2023. These financial statements should be read in conjunction with the Notes to Consolidated Financial Statements appearing in that report. All adjustments, comprising only normal recurring adjustments which are, in the opinion of management, necessary for a fair presentation of results for the interim periods, have been reflected and all intercompany transactions have been eliminated. The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses in the reporting period. The actual results experienced by INDUS may differ materially and adversely from INDUS’ estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected. There are various accounting updates recently issued which represent technical corrections to the accounting literature or apply to specific industries. INDUS does not expect the application of any of these updates to have an impact on its consolidated financial statements. Cash, Cash Equivalents and Restricted Cash INDUS considers all highly liquid investments with a maturity of three months or less at the date of purchase to be cash equivalents. INDUS’ restricted cash primarily consists of reserves for real estate taxes as required by certain mortgage note obligations. Discontinued Operations Operating results and the gain or loss on sale for a component or groups of components, whose disposition represents a strategic shift that has or will have a major effect on the Company’s operations and financial results, are presented as discontinued operations in the consolidated statements of operations and the assets and liabilities of the component to be disposed of are classified as held for sale. In December 2022, INDUS completed the previously announced sale of its remaining office/flex properties (the “Office/Flex Portfolio”) and fully exited its legacy investment in office properties (see Note 3). The Office/Flex Portfolio was comprised of seven buildings totaling approximately 175,000 square feet located in Bloomfield, Connecticut as well as an approximately 18,000 square foot building that is located adjacent to the Office/Flex Portfolio and was principally used for storage by INDUS’ property management group. In March 2022, the Company closed its landscaping division which primarily served the Office/Flex Portfolio and recorded a gain on sale of $203 for the three months ended March 31, 2022. |
Fair Value
Fair Value | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value | |
Fair Value | 2. Fair Value INDUS applies the provisions of ASC 820, “Fair Value Measurement,” which establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs, when measuring fair value. The categorization of an asset or liability within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 establishes three levels of inputs that may be used to measure fair value, as follows: Level 1 applies to assets or liabilities for which there are quoted market prices in active markets for identical assets or liabilities. Level 2 applies to assets or liabilities for which there are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, such as quoted prices for similar assets or liabilities in active markets; quoted prices for assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data. Level 2 assets and liabilities include INDUS’ interest rate swap agreements (see Note 4). These inputs are readily available in public markets or can be derived from information available in publicly quoted markets, therefore, INDUS has categorized these derivative instruments as Level 2 within the fair value hierarchy. Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. The following are INDUS’ financial assets and liabilities carried at fair value and measured at fair value on a recurring basis: March 31, 2023 Quoted Prices in Significant Significant Active Markets for Observable Unobservable Identical Assets Inputs Inputs (Level 1) (Level 2) (Level 3) Interest rate swap assets $ — $ 4,504 $ — Interest rate swap liabilities $ — $ — $ — December 31, 2022 Quoted Prices in Significant Significant Active Markets for Observable Unobservable Identical Assets Inputs Inputs (Level 1) (Level 2) (Level 3) Interest rate swap asset $ — $ 6,971 $ — Interest rate swap liabilities $ — $ — $ — The amounts included in the consolidated financial statements for cash and cash equivalents, leasing receivables from tenants, accounts payable and accrued liabilities and interest rate swap assets approximate their fair values because of the short-term maturities of these instruments. The fair values of the interest rate swaps (used for purposes other than trading) are determined based on discounted cash flow models that incorporate the cash flows of the derivatives as well as the current Overnight Index Swap Rate and swap curve along with other market data, taking into account current interest rates and the credit worthiness of the counterparty for assets and the credit worthiness of INDUS for liabilities. The fair values of the mortgage loans and delayed draw term loan, net of debt issuance costs, are estimated based on current rates offered to INDUS for similar debt of the same remaining maturities and, additionally, INDUS considers its credit worthiness in determining the fair value of its mortgage loans. At March 31, 2023 and December 31, 2022, the carrying values of the mortgage loans and delayed draw term loan were $167,912 and $168,366, respectively, and the fair values of the mortgage loans and delayed draw term loan were $166,571 and $166,665, respectively. |
Real Estate Assets and Disconti
Real Estate Assets and Discontinued Operations | 3 Months Ended |
Mar. 31, 2023 | |
Real Estate Assets And Discontinued Operations | |
Real Estate Assets And Discontinued Operations | 3. Real Estate Assets and Discontinued Operations Real estate assets consist of: Estimated Useful Lives March 31, 2023 December 31, 2022 Land $ 90,927 $ 71,148 Land improvements 10 to 30 years 79,071 78,974 Buildings and improvements 10 to 40 years 380,899 379,864 Tenant improvements Shorter of useful life or terms of related lease 33,031 32,753 Construction in progress 32,748 21,419 Development costs 3,722 3,722 620,398 587,880 Accumulated depreciation (102,585) (98,219) $ 517,813 $ 489,661 Total depreciation expense related to real estate assets was as follows: For the Three Months Ended March 31, 2023 March 31, 2022 Depreciation expense $ 4,413 $ 3,637 On January 24, 2023, the Company closed on the purchase of approximately 11 acres of undeveloped land in the Lehigh Valley (the “Lehigh Valley Land”) that was under contract since 2021. The purchase price was $2,361, after transaction costs. The Lehigh Valley Land has the entitlements to support the construction of an approximately 90,000 square foot building. On January 23, 2023, the Company closed on the purchase of approximately 75 acres of fully entitled land in the Orlando, Florida market (the “Orlando Land”). The purchase price was $17,418, after transaction costs. The Orlando Land has the entitlements to support the construction of three buildings totaling approximately 574,000 square feet. On January 19, 2022, INDUS closed on the purchase of 782 Paragon Way, an approximately 217,000 square foot, fully leased building in the Charlotte, North Carolina market for $24,026, including transaction costs. INDUS determined the fair value of the assets acquired approximated the purchase price, which was allocated as follows: Land $ 1,469 Land improvements 329 Buildings and improvements 22,228 $ 24,026 Discontinued Operations In December 2022, the Company completed the previously announced sale of its Office/Flex Portfolio (see Note 1). The Office/Flex Portfolio was comprised of seven buildings totaling approximately 175,000 square feet located in Bloomfield, Connecticut as well as an approximately 18,000 square foot building that is located adjacent to the Office/Flex Portfolio and was principally used for storage by INDUS’ property management group. The loss from discontinued operations in our accompanying consolidated statement of operations is comprised of: For the Three Months Ended March 31, 2022 Rental revenue $ 504 Expenses: Operating expenses of rental properties 268 Real estate taxes 82 Depreciation and amortization expense 240 Total expenses 590 Loss from discontinued operations $ (86) In March 2022, the Company also closed its landscaping division which primarily served the Office/Flex Portfolio and recorded a gain on sale of $203 for the quarter ended March 31, 2022. There were no assets and liabilities in discontinued operations as of March 31, 2023. As of December 31, 2022, assets and liabilities in discontinued operations consisted of: Other assets $ 29 Total assets of discontinued operations $ 29 Accounts payable and accrued liabilities $ 75 Other liabilities 44 Total liabilities of discontinued operations $ 119 Cash flows from discontinued operations were as follows: For the Three Months Ended March 31, 2022 Net cash provided by operating activities of discontinued operations $ 56 Net cash provided by investing activities of discontinued operations $ 26 Net cash provided by financing activities of discontinued operations $ — |
Mortgages Loans, Delayed Draw T
Mortgages Loans, Delayed Draw Term Loan and Interest Rate Swaps | 3 Months Ended |
Mar. 31, 2023 | |
Mortgages Loans, Delayed Draw Term Loan and Interest Rate Swaps | |
Mortgages Loans, Delayed Draw Term Loan and Interest Rate Swaps | 4. Mortgages Loans, Delayed Draw Term Loan and Interest Rate Swaps INDUS’ nonrecourse mortgage loans consist of: Mortgage loans: March 31, 2023 December 31, 2022 3.97%, due September 1, 2027 $ 10,854 $ 10,919 4.57%, due February 1, 2028 * 16,541 16,666 3.60%, due January 2, 2030 * 5,962 6,007 3.48%, due February 1, 2030 13,774 13,879 3.50%, due July 1, 2030 * 4,743 4,778 4.33%, due August 1, 2030 15,372 15,473 4.51%, due April 1, 2034 12,921 13,010 Mortgage loans 80,167 80,732 Debt issuance costs (1,042) (1,079) Mortgage loans, net of debt issuance costs $ 79,125 $ 79,653 *Variable rate loans for which INDUS entered into interest rate swap agreements to effectively fix the interest rates on these loans to the rates reflected above. INDUS’ weighted average interest rate on its outstanding mortgage loans and delayed draw term loan, including the effect of its interest rate swap agreements, was 4.13% as of March 31, 2023 and December 31, 2022. The Company accounts for its interest rate swap agreements as effective cash flow hedges. Amounts in accumulated other comprehensive income (“AOCI”) will be reclassified into interest expense over the term of the swap agreements to achieve fixed interest rates on each variable rate mortgage. None of the interest rate swap agreements contain any credit risk related contingent features. In the first quarter of 2023, INDUS recognized a loss, included in other comprehensive income, of $2,467 on its interest rate swap agreements. In the first quarter of 2022, INDUS recognized a gain, included in other comprehensive income, of $4,662 on its interest rate swap agreements. As of March 31, 2023, $3,133 was expected to be reclassified over the next twelve months to AOCI from interest expense. Interest income related to INDUS’ interest rate swap agreements in the first quarters of 2023 and 2022 was $522 and $451, respectively. On April 21, 2022, INDUS entered into an Amended and Restated Credit Agreement (the “Credit Agreement”) for a $250,000 secured credit facility (the “New Credit Facility”) (see Note 5), amending and restating the $100,000 credit facility executed on August 5, 2021 (the “Existing Credit Facility”) to include the addition of a delayed draw term loan facility (the “DDTL Facility”) of $150,000 for a term of five years , pursuant to which up to three separate draws may be made prior to April 21, 2023. The Company made the first two of such draws under the DDTL Facility in 2022 and as of March 31, 2023, INDUS had drawn $90,000 under the DDTL Facility (see Note 5) with net debt issuance costs related to the DDTL Facility of $1,213. Subsequent to March 31, 2023, the Company made the final draw of $60,000 under the DDTL Facility (see Notes 5 and 10). The DDTL Facility bears interest at the Secured Overnight Financing Rate (“SOFR”) plus 1.15%, based on the Company’s ratio of total indebtedness to total assets. Concurrent with the closing on the DDTL Facility, the Company entered into an interest rate swap agreement to fix the interest rate on the DDTL Facility at an effective rate of 4.15%. The following table summarizes the notional and fair values of our interest rate swaps designated as cash flow hedges at March 31, 2023 and December 31, 2022: Fair Value of Interest Rate LIBOR SOFR Current Notional Value Derivative Assets/(Liabilities) Effective Maturity Interest Interest March 31, December 31, March 31, December 31, Date Date Strike Rate Strike Rate 2023 2022 2023 2022 July 1, 2022 April 21, 2027 n/a 2.933% $ 90,000 $ 90,000 $ 2,774 $ 4,704 March 15, 2017 March 1, 2027 (a) 2.501% n/a 10,204 10,290 378 522 February 1, 2018 February 1, 2028 (a) 2.782% n/a 6,337 6,376 190 324 January 2, 2020 January 1, 2030 1.849% n/a 5,962 6,007 487 621 July 1, 2020 July 1, 2030 0.942% n/a 4,743 4,778 675 800 $ 117,246 $ 117,451 $ 4,504 $ 6,971 (a) represents multiple interest rate swap agreements against a single mortgage In July 2017, the Financial Conduct Authority in the United Kingdom, which regulates the London Interbank Offered Rate (“LIBOR”), announced that it intends to stop compelling banks to submit rates for the calculation of LIBOR after June 30, 2023. INDUS currently expects LIBOR-indexed rates to be available through that date, however, it is possible that they will become unavailable prior to that time. The interest rate on INDUS’ floating rate debt under nonrecourse mortgage loans is based on LIBOR, however, INDUS entered into interest rate swap agreements whereby the floating LIBOR rates under all mortgage loans are hedged, effectively fixing the interest rate on those loans. INDUS’ loan documents contain provisions that contemplate alternative methods to determine the base rate applicable to our LIBOR-indexed debt to the extent LIBOR-indexed rates are not available. INDUS will continue to monitor and evaluate the impact, if any, on debt payments and the value of the Company’s floating rate debt. |
Revolving and Delayed Draw Term
Revolving and Delayed Draw Term Loan Facility Credit Agreement | 3 Months Ended |
Mar. 31, 2023 | |
Revolving and Delayed Draw Term Loan Facility Credit Agreement | |
Revolving and Delayed Draw Term Loan Facility Credit Agreement | 5. Revolving and Delayed Draw Term Loan Facility Credit Agreement On April 21, 2022, the Credit Agreement was amended and restated to provide for, among other things: (1) the addition of the DDTL Facility of $150,000 (see Note 4), pursuant to which up to three separate draws were permitted to be made prior to April 21, 2023, and (2) the transition from LIBOR to SOFR for floating rate borrowings for all purposes under the Credit Agreement. The DDTL Facility will mature on April 21, 2027. The New Credit Facility continues to include a $100,000 revolving credit facility (the “Revolving Credit Facility”), however, the maturity of the Revolving Credit Facility was extended to April 21, 2025. The two one-year extensions at the Company’s option under the Existing Credit Facility remain in place under the New Credit Facility. The New Credit Facility also increases the uncommitted incremental facility, which, as amended, would enable the Company to increase the New Credit Facility by up to $250,000 in the aggregate, for a total of $500,000 . Borrowings under the New Credit Facility will continue to bear interest subject to a pricing grid for changes in the Company’s total leverage. Based on the Company’s current leverage, the initial annual interest rates under the New Credit Facility would be (i) SOFR plus 1.20% for revolving borrowings (the same applicable margin as under the Existing Credit Facility), and (ii) SOFR plus 1.15% for term borrowings (compared with LIBOR plus 1.20% under the Existing Credit Facility). The annual interest rate under the Existing Credit Facility was one-month LIBOR plus 1.20% . As of March 31, 2023, the Company had drawn Under the terms of the New Credit Facility, INDUS must maintain: (i) a consolidated tangible net worth of $319,149 plus 75% of the aggregate increases in stockholders’ equity of the Company by reason of issuance or sale of equity of the Company after March 31, 2021; (ii) a fixed charge coverage ratio of (a) 1.25 to 1.0 through March 31, 2022, and (b) 1.50 to 1.0 on and after June 30, 2022; (iii) a maximum leverage ratio of total indebtedness to total assets of less than 60% on the last day of any fiscal quarter; (iv) a maximum secured leverage ratio of total secured indebtedness to total asset value of (a) 50% through December 31, 2022, and (b) 40% on and after March 31, 2023; (v) a minimum borrowing base of (a) $75,000 through December 30, 2022 (compared with $30,000 under the Existing Credit Facility), (b) $125,000 from December 31, 2022 through December 30, 2023 (compared with $50,000 under the Existing Credit Facility), and (c) $250,000 on and after December 31, 2023 (compared with $100,000 under the Existing Credit Facility); and (vi) a minimum of (a) five industrial unencumbered properties from June 30, 2021 through December 30, 2023, and (b) eight industrial unencumbered properties on and after December 31, 2023. As of March 31, 2023, the Company was in compliance with the covenants of the New Credit Facility and based on the unencumbered properties pledged, the maximum amount available could be borrowed. In addition to the $90,000 drawn under the DDTL Facility, the New Credit Facility also secures certain unused standby letters of credit aggregating $6,822 that are related to INDUS' development activities. |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2023 | |
Stockholders' Equity | |
Stockholders' Equity | 6. Stockholders’ Equity Per Share Results Basic and diluted per share results were based on the following: For the Three Months Ended March 31, 2023 March 31, 2022 Net (loss) income $ (5,777) $ 269 Weighted average shares outstanding for computation of basic per share results 10,194 10,185 Incremental shares from assumed exercise of stock options and warrants and the grant of restricted stock units (a) — 236 Adjusted weighted average shares for computation of diluted per share results 10,194 10,421 (a) Incremental shares from the assumed exercise of INDUS stock options are not included in periods where the inclusion of such shares would be anti-dilutive. The incremental shares from the assumed exercise of stock options and warrants and the grant of restricted stock units for the three months ended March 31, 2023 would have been 167 . Equity Compensation Plans Stock Options There were no stock options granted, exercised or forfeited in either the first quarter of 2023 or the first quarter of 2022. There were 211,702 stock options outstanding at March 31, 2023 with a weighted average exercise price of $36.89 and 220,937 stock options outstanding at March 31, 2022 with a weighted average exercise price of $36.47. Weighted Avg. Remaining Range of Exercise Prices for Outstanding at Weighted Avg. Contractual Life Total Intrinsic Outstanding Options March 31, 2023 Exercise Price (in years) Value $23.00 - $28.00 74,663 $ 26.29 3.0 $ 2,987 $28.00 - $32.00 14,073 $ 29.84 2.3 513 $32.00 - $47.00 122,966 $ 44.13 6.8 2,725 211,702 $ 36.89 5.2 $ 6,225 Vested options 143,561 $ 32.82 4.4 $ 4,805 As of March 31, 2023, the unrecognized compensation expense related to unvested stock options that will be recognized during future periods is as follows: Balance of 2023 $ 154 2024 $ 111 2025 $ 15 Number of option holders at March 31, 2023 14 Restricted Stock Units A summary of restricted stock units relating to common stock (“RSUs”) awarded under the INDUS Realty, LLC 2020 Incentive Award Plan for the three months ended March 31, 2023 and 2022 is as follows: Time-based vesting March 31, 2023 March 31, 2022 Number of Grant Date Fair Number of Grant Date Fair Units Value Weighted Avg. Units Value Weighted Avg. Outstanding at beginning of period 22,332 $ 66.56 12,829 $ 64.43 Granted 11,692 $ 63.82 7,991 $ 76.71 Adjustment for dividends 63 $ — 26 $ — Vested and distributed (3,294) $ 67.09 (2,718) $ 63.15 Forfeited — $ — (813) $ 63.15 Outstanding at end of period 30,793 $ 65.33 17,315 $ 70.26 Performance-based vesting March 31, 2023 March 31, 2022 Number of Grant Date Fair Number of Grant Date Fair Units Value Weighted Avg. Units Value Weighted Avg. Outstanding at beginning of period 15,054 $ 89.50 8,136 $ 78.97 Granted 11,685 $ 73.25 7,999 $ 100.19 Adjustment for dividends 43 $ — 16 $ — Forfeited — $ — (1,219) $ 79.33 Outstanding at end of period 26,782 $ 82.26 14,932 $ 90.22 The time-based vesting RSUs granted to employees vest over three years in equal installments subject to the recipient’s continued employment. The time-based vesting RSUs granted to non-employee directors vest in one year . The performance-based vesting RSUs granted to employees vest after a period of three years and will be measured over the three-year period on pre-established goals. The holders of RSUs will receive credit for dividends, but do not have voting rights. The RSUs may not be sold, assigned, transferred, pledged or otherwise disposed of and are subject to risk of forfeiture prior to the expiration of the applicable vesting period. As of March 31, 2023, the unrecognized compensation expense related to RSUs that will be recognized during future periods is as follows: Balance of 2023 $ 1,084 2024 $ 852 2025 $ 418 2026 $ 29 Compensation expense for stock options and RSUs was as follows: For the Three Months Ended March 31, 2023 March 31, 2022 Compensation expense $ 503 $ 273 Dividends For the three months ended March 31, 2023, the Company’s common dividend was as follows: Quarter Ended Record Date Payment Date Common dividend per share March 31, 2023 March 31, 2023 April 14, 2023 $0.18 For the three months ended March 31, 2022, the Company’s common dividend was as follows: Quarter Ended Record Date Payment Date Common dividend per share March 31, 2022 March 31, 2022 April 15, 2022 $0.16 |
Leases
Leases | 3 Months Ended |
Mar. 31, 2023 | |
Leases | |
Leases | 7. Leases The Company’s rental revenue reflects the leasing of industrial/logistics properties and certain land parcels. INDUS does not have any variable payment leases with its tenants. All of INDUS’ leases with its tenants are classified as operating leases. The following is a schedule of minimum future cash rentals on the Company’s operating leases as of March 31, 2023. The schedule does not reflect future rental revenues from the renewal or replacement of existing leases or for leases on facilities not yet in service and excludes real estate taxes and property operating expense reimbursements: Balance of 2023 $ 30,509 2024 40,781 2025 37,390 2026 29,903 2027 21,383 Thereafter 57,221 $ 217,187 Expenses related to operating leases where INDUS is the lessee were $84 and $35 in the first quarter of 2023 and 2022, respectively. The weighted average remaining lease term for these leases as of March 31, 2023, was 8.3 years. As of March 31, 2023 and December 31, 2022, our operating leases had weighted-average discount rates of 3.69% and 3.70% , respectively. Maturities of lease liabilities as of March 31, 2023 are as follows: Balance of 2023 $ 245 2024 330 2025 332 2026 310 2027 197 Thereafter 1,028 Total undiscounted payments 2,442 Less: imputed interest (354) Present value of minimum lease payments $ 2,088 |
Supplemental Financial Statemen
Supplemental Financial Statement Information | 3 Months Ended |
Mar. 31, 2023 | |
Supplemental Financial Statement Information | |
Supplemental Financial Statement Information | 8. Supplemental Financial Statement Information Other Assets INDUS' other assets are comprised of the following: March 31, 2023 December 31, 2022 Deposits on building and land acquisitions $ 14,488 $ 15,588 Straight-line rents 7,789 7,547 Deferred leasing costs, net 7,076 7,118 Intangible assets, net 5,502 5,813 Prepaid expenses 2,642 3,497 Accounts receivable (primarily leases) 2,347 2,790 Right-of-use assets 2,057 2,123 Furniture, fixtures and equipment, net 1,741 1,791 Deferred financing costs related to revolving lines of credit 572 631 Registration statement costs 341 341 Prepaid development costs 32 88 Other 444 447 Total other assets $ 45,031 $ 47,774 Accounts Payable and Accrued Liabilities INDUS' accounts payable and accrued liabilities are comprised of the following: March 31, 2023 December 31, 2022 Accrued construction costs and retainage $ 6,882 $ 5,030 Accrued strategic transaction costs 4,600 615 Trade payables 835 1,528 Accrued real estate taxes 711 25 Accrued salaries, wages and other compensation 579 2,363 Accrued interest payable 419 447 Accrued lease commissions 351 191 Other 738 741 Total accounts payable and accrued liabilities $ 15,115 $ 10,940 Other Liabilities INDUS' other liabilities are comprised of the following: March 31, 2023 December 31, 2022 Deferred compensation plan $ 3,496 $ 3,363 Intangible liability, net 3,086 3,203 Prepaid rent from tenants 2,154 1,449 Lease liabilities 2,088 2,150 Security deposits of tenants 1,304 1,229 Other 139 143 Total other liabilities $ 12,267 $ 11,537 Supplemental Cash Flow Information Accounts payable and accrued liabilities related to additions to real estate assets increased by $1,852 and $3,401 in the three months ended March 31, 2023 and 2022, respectively. Interest payments were as follows: For the Three Months Ended March 31, 2023 March 31, 2022 $ 1,873 $ 1,608 Capitalized interest related to real estate assets was as follows: For the Three Months Ended March 31, 2023 March 31, 2022 $ 267 $ 356 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2023 | |
Commitments and Contingencies. | |
Commitments and Contingencies | 9. Commitments and Contingencies As of March 31, 2023, INDUS had commitments of approximately $12,785 principally related to the construction of an approximately 206,000 square foot building in the Lehigh Valley of Pennsylvania, as well as improvements of its real estate assets. On March 2, 2022, INDUS entered into an agreement to acquire, for a purchase price of $28,500, an under-construction, approximately 284,400 square foot building in Greenville-Spartanburg, South Carolina (the “Greenville-Spartanburg Acquisition”), being developed on speculation by the seller. The Greenville-Spartanburg Acquisition would be the Company’s first entry into this market. Closing on the purchase of the Greenville-Spartanburg Acquisition is subject to a number of contingencies including completion of construction. There can be no guarantee that the Greenville-Spartanburg Acquisition will be completed under its current terms, or at all. On January 17, 2022, the Company entered into an agreement (the “Charlotte Land Purchase Agreement”) to acquire, for a purchase price of approximately $4,750, as amended, before transaction costs, approximately 231 acres of undeveloped land in the Charlotte, North Carolina market (the “Charlotte Land”). A closing under the Charlotte Land Purchase Agreement, is subject to significant contingencies, including INDUS’ receipt of all of the requisite entitlements from governmental authorities and agencies to construct the buildings. Given these contingencies, it is possible that the land acquisition as contemplated under the Charlotte Land Purchase Agreement will not be completed under its current terms, or at all. On August 5, 2021, the Company entered into a Purchase and Sale Agreement (the “Nashville Forward Purchase Agreement”) to acquire, for a purchase price of approximately $31,500, before transaction costs, an under-construction approximately 184,000 square foot two-building portfolio in Nashville, Tennessee (the “Nashville Acquisition”). The Nashville Acquisition was initially developed on speculation by the seller, however, it is now fully pre-leased. On December 21, 2022, the Nashville Forward Purchase Agreement was amended to reduce the purchase price to $28,350. Closing under the Nashville Forward Purchase Agreement, is subject to significant contingencies, including the completion of construction. Given these contingencies, it is possible that the Nashville Acquisition as contemplated under the Nashville Forward Purchase Agreement will not be completed under its current terms, or at all. On November 23, 2021, the Company entered into an agreement (the “Charlotte Forward Purchase Agreement”) to acquire, for a purchase price of $21,200, before transaction costs, an approximately 231,000 square foot building in the Charlotte, North Carolina market to be built by the seller. Closing on the Charlotte Forward Purchase Agreement is subject to a number of contingencies including completion of construction. There can be no guarantee that the Charlotte Forward Purchase Agreement will be completed under its current terms, or at all. On November 3, 2021, the Company entered into an agreement (the “Charleston Forward Purchase Agreement”) to acquire, for a purchase price of approximately $28,000, before transaction costs, an approximately 263,000 square foot building in Charleston, South Carolina to be built by the seller. The building subsequently was fully-leased and closing on the Charleston Forward Purchase Agreement took place on April 26, 2023 (see Note 10). From time to time, INDUS is a party to various litigation matters that are considered routine litigation arising in the ordinary course of business. Other than as disclosed in Note 10, Subsequent Events, in the opinion of management, based on the advice of legal counsel, the ultimate liability, if any, with respect to these matters is not expected to be material, individually or in the aggregate, to the Company’s consolidated financial position, results of operations or cash flows. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2023 | |
Subsequent Events. | |
Subsequent Events | 10. Subsequent Events In accordance with FASB ASC 855, “Subsequent Events,” INDUS has evaluated all events or transactions occurring after March 31, 2023, the balance sheet date, and noted that there have been no such events or transactions which would require recognition or disclosure in the consolidated financial statements as of and for the period ended March 31, 2023, other than the disclosures herein. On April 26, 2023, the Company closed on the purchase of the Charleston Forward Purchase Agreement (see Note 9). Subsequent to March 31, 2023, INDUS made the final draw of $60,000 under its DDTL Facility (see Note 5). On April 12, 2023, purported stockholder Ryan O’Dell filed a lawsuit against the Company and certain of its directors and officers in District Court in the Southern District of New York for violations of Sections 14(a) and 20(a) of the Securities Exchange Act of 1934. O’Dell v. INDUS Realty Trust, et. al., Case No. 23-cv-03071 (April 12, 2023). The complaint alleges that the Company’s disclosures in connection with the Merger were materially incomplete and misleading. The Company also received demand letters from purported stockholders making similar allegations. On April 19, 2023, purported stockholder Robert Garfield filed a lawsuit against the Company and certain of its directors and officers as well as certain other parties to the Merger in Connecticut Superior Court, Judicial District of Hartford, alleging breach of fiduciary duties, negligent misrepresentation and fraudulent misrepresentation in connection with the proposed Merger. On April 27, 2023, purported stockholder John Thompson filed a lawsuit against the Company and certain of its directors and officers in District Court in the Southern District of New York for violations of Section 14(a) and 20(a) of the Securities Exchange Act of 1934 and SEC Rule 14a-9. Thompson v. INDUS Realty Trust, et al., Case No. 1:23-cv-03518 (April 27, 2023). Each of the complaints seeks to enjoin the Merger and to receive monetary damages and other equitable relief. The Company does not believe the allegations in the complaints and demand letters are meritorious, and intends to defend against them vigorously. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
Summary of Significant Accounting Policies | |
Proposed Merger | Proposed Merger On February 22, 2023, INDUS, IR Parent, LLC, a Delaware limited liability company (“Parent”), and IR Merger Sub II, Inc., a Maryland corporation and a wholly-owned subsidiary of Parent (“Merger Sub” and, together with Parent, the “Parent Parties”), entered into an Agreement and Plan of Merger (the “Merger Agreement”). The Merger Agreement provides that, upon the terms and subject to the conditions set forth therein, Merger Sub will be merged with and into INDUS (the “Merger”). Upon completion of the Merger, INDUS will survive as a wholly-owned subsidiary of Parent (the “Surviving Entity”) and the separate corporate existence of Merger Sub will cease, and INDUS will cease to be a publicly traded company on the Nasdaq Stock Market LLC. At the effective time of the Merger (the “Effective Time”), each share of INDUS common stock that is issued and outstanding immediately prior to the Effective Time (other than shares held by the Parent Parties), will be automatically converted into the right to receive $67.00 in cash, without interest (the “Merger Consideration”). The Merger Consideration will also be increased by an amount per share of INDUS common stock, in cash (rounded to the nearest whole cent), if any, equal to the sum of (1) the cash amount per share of INDUS common stock equal to the most recently declared regular quarterly cash dividend of INDUS permitted by the terms of the Merger Agreement as of the date prior to the closing date of the Merger (the “Closing Date” and such dividend, the “Final Dividend”), if the record date for the Final Dividend is after the closing of the Merger, plus (2)(A) the cash amount per share of INDUS common stock equal to the Final Dividend, multiplied by (B) the number of days between the first day following the end of the quarterly period for which the Final Dividend was declared, if any, and the day prior to the Closing Date, divided by (C) 90, rounded to the nearest whole cent, without duplication for any period. The Merger Agreement contains customary representations, warranties and covenants, including, among others, covenants by INDUS to conduct its business in the ordinary course consistent with past practice, subject to certain exceptions, during the period between the execution of the Merger Agreement and the consummation of the Merger. The Merger Agreement also requires INDUS to convene and hold a stockholders’ meeting for the purpose of obtaining the Stockholder Approval (as defined in the Merger Agreement). The stockholders’ meeting is scheduled for May 17, 2023. The closing of the Merger is subject to customary closing conditions, including, among others, (i) the approval of the Merger by the affirmative vote of the holders of a majority of the outstanding shares of INDUS common stock entitled to vote on the Merger; (ii) the clearance by the Committee on Foreign Investment in the United States and (iii) the approval by the European Commission under Council Regulation (EC) No. 139/2004 (as amended). The closing of the Merger is not subject to a financing condition. There can be no assurances that the Merger will close on the anticipated timeline, or at all. |
Basis of Presentation | Basis of Presentation INDUS Realty Trust, Inc., a Maryland corporation, (“INDUS” or the “Company”) is a real estate business principally engaged in developing, acquiring, managing and leasing high-quality industrial and logistics properties in select supply-constrained markets in the United States. The Company conducts substantially all of its business through its operating partnership, INDUS RT, LP, a Maryland limited partnership (the “Operating Partnership”). The Company is the sole general partner of the Operating Partnership. As used herein, the “Company” refers to INDUS Realty Trust, Inc. and its consolidated subsidiaries and partnerships, including the Operating Partnership, except where context otherwise requires. INDUS manages its operations on an aggregated, single segment basis for purposes of assessing performance and making operating decisions and, accordingly, has only one reporting and operating segment. As of March 31, 2023, INDUS owned 42 industrial/logistics properties aggregating approximately 6.1 million square feet located in Connecticut, Pennsylvania, North Carolina, South Carolina and Florida. INDUS seeks to add to its property portfolio through the development of land or the acquisition of modern, market-appropriate logistics buildings which can serve multiple drivers of demand in the modern supply chain in the markets it targets. INDUS also owns undeveloped land parcels, much of which is not consistent with the Company’s core industrial and logistics strategy, and, therefore, the Company sells certain non-core properties periodically over time. The results of operations for the three months ended March 31, 2023 are not necessarily indicative of the results to be expected for the full year. Certain amounts from the prior year period have been reclassified to conform to the current presentation. These financial statements have been prepared in conformity with the standards of accounting measurement set forth by the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 270, “Interim Reporting” and in accordance with the accounting policies stated in INDUS’ audited consolidated financial statements for the year ended December 31, 2022 included in INDUS’ Annual Report on Form 10-K, filed with the SEC on March 6, 2023. These financial statements should be read in conjunction with the Notes to Consolidated Financial Statements appearing in that report. All adjustments, comprising only normal recurring adjustments which are, in the opinion of management, necessary for a fair presentation of results for the interim periods, have been reflected and all intercompany transactions have been eliminated. The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses in the reporting period. The actual results experienced by INDUS may differ materially and adversely from INDUS’ estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected. There are various accounting updates recently issued which represent technical corrections to the accounting literature or apply to specific industries. INDUS does not expect the application of any of these updates to have an impact on its consolidated financial statements. |
Cash, Cash Equivalents and Restricted Cash | Cash, Cash Equivalents and Restricted Cash INDUS considers all highly liquid investments with a maturity of three months or less at the date of purchase to be cash equivalents. INDUS’ restricted cash primarily consists of reserves for real estate taxes as required by certain mortgage note obligations. |
Discontinued Operations | Discontinued Operations Operating results and the gain or loss on sale for a component or groups of components, whose disposition represents a strategic shift that has or will have a major effect on the Company’s operations and financial results, are presented as discontinued operations in the consolidated statements of operations and the assets and liabilities of the component to be disposed of are classified as held for sale. In December 2022, INDUS completed the previously announced sale of its remaining office/flex properties (the “Office/Flex Portfolio”) and fully exited its legacy investment in office properties (see Note 3). The Office/Flex Portfolio was comprised of seven buildings totaling approximately 175,000 square feet located in Bloomfield, Connecticut as well as an approximately 18,000 square foot building that is located adjacent to the Office/Flex Portfolio and was principally used for storage by INDUS’ property management group. In March 2022, the Company closed its landscaping division which primarily served the Office/Flex Portfolio and recorded a gain on sale of $203 for the three months ended March 31, 2022. |
Fair Value (Tables)
Fair Value (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value | |
Schedule of financial assets and liabilities carried at fair value and measured at fair value on a recurring basis: | March 31, 2023 Quoted Prices in Significant Significant Active Markets for Observable Unobservable Identical Assets Inputs Inputs (Level 1) (Level 2) (Level 3) Interest rate swap assets $ — $ 4,504 $ — Interest rate swap liabilities $ — $ — $ — December 31, 2022 Quoted Prices in Significant Significant Active Markets for Observable Unobservable Identical Assets Inputs Inputs (Level 1) (Level 2) (Level 3) Interest rate swap asset $ — $ 6,971 $ — Interest rate swap liabilities $ — $ — $ — |
Real Estate Assets and Discon_2
Real Estate Assets and Discontinued Operations (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Real Estate Assets And Discontinued Operations | |
Schedule of real estate assets | Estimated Useful Lives March 31, 2023 December 31, 2022 Land $ 90,927 $ 71,148 Land improvements 10 to 30 years 79,071 78,974 Buildings and improvements 10 to 40 years 380,899 379,864 Tenant improvements Shorter of useful life or terms of related lease 33,031 32,753 Construction in progress 32,748 21,419 Development costs 3,722 3,722 620,398 587,880 Accumulated depreciation (102,585) (98,219) $ 517,813 $ 489,661 |
Schedule of total depreciation expense and capitalized interest related to real estate assets | For the Three Months Ended March 31, 2023 March 31, 2022 Depreciation expense $ 4,413 $ 3,637 |
Schedule of purchase price allocation | Land $ 1,469 Land improvements 329 Buildings and improvements 22,228 $ 24,026 |
Schedule of loss from discontinued operations | For the Three Months Ended March 31, 2022 Rental revenue $ 504 Expenses: Operating expenses of rental properties 268 Real estate taxes 82 Depreciation and amortization expense 240 Total expenses 590 Loss from discontinued operations $ (86) |
Schedule of assets and liabilities in discontinued operations | Other assets $ 29 Total assets of discontinued operations $ 29 Accounts payable and accrued liabilities $ 75 Other liabilities 44 Total liabilities of discontinued operations $ 119 |
Schedule of cash flows from discontinued operations | For the Three Months Ended March 31, 2022 Net cash provided by operating activities of discontinued operations $ 56 Net cash provided by investing activities of discontinued operations $ 26 Net cash provided by financing activities of discontinued operations $ — |
Mortgages Loans, Delayed Draw_2
Mortgages Loans, Delayed Draw Term Loan and Interest Rate Swaps (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Mortgages Loans, Delayed Draw Term Loan and Interest Rate Swaps | |
Schedule of mortgage loans | Mortgage loans: March 31, 2023 December 31, 2022 3.97%, due September 1, 2027 $ 10,854 $ 10,919 4.57%, due February 1, 2028 * 16,541 16,666 3.60%, due January 2, 2030 * 5,962 6,007 3.48%, due February 1, 2030 13,774 13,879 3.50%, due July 1, 2030 * 4,743 4,778 4.33%, due August 1, 2030 15,372 15,473 4.51%, due April 1, 2034 12,921 13,010 Mortgage loans 80,167 80,732 Debt issuance costs (1,042) (1,079) Mortgage loans, net of debt issuance costs $ 79,125 $ 79,653 *Variable rate loans for which INDUS entered into interest rate swap agreements to effectively fix the interest rates on these loans to the rates reflected above. |
Schedule of notional and fair value of our interest rate swaps | Fair Value of Interest Rate LIBOR SOFR Current Notional Value Derivative Assets/(Liabilities) Effective Maturity Interest Interest March 31, December 31, March 31, December 31, Date Date Strike Rate Strike Rate 2023 2022 2023 2022 July 1, 2022 April 21, 2027 n/a 2.933% $ 90,000 $ 90,000 $ 2,774 $ 4,704 March 15, 2017 March 1, 2027 (a) 2.501% n/a 10,204 10,290 378 522 February 1, 2018 February 1, 2028 (a) 2.782% n/a 6,337 6,376 190 324 January 2, 2020 January 1, 2030 1.849% n/a 5,962 6,007 487 621 July 1, 2020 July 1, 2030 0.942% n/a 4,743 4,778 675 800 $ 117,246 $ 117,451 $ 4,504 $ 6,971 (a) represents multiple interest rate swap agreements against a single mortgage |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Schedule of basic and diluted per share results | For the Three Months Ended March 31, 2023 March 31, 2022 Net (loss) income $ (5,777) $ 269 Weighted average shares outstanding for computation of basic per share results 10,194 10,185 Incremental shares from assumed exercise of stock options and warrants and the grant of restricted stock units (a) — 236 Adjusted weighted average shares for computation of diluted per share results 10,194 10,421 (a) Incremental shares from the assumed exercise of INDUS stock options are not included in periods where the inclusion of such shares would be anti-dilutive. The incremental shares from the assumed exercise of stock options and warrants and the grant of restricted stock units for the three months ended March 31, 2023 would have been 167 . |
Schedule of unrecognized compensation expense related to nonvested stock options | Balance of 2023 $ 154 2024 $ 111 2025 $ 15 |
Schedule of option holders | |
Schedule of options by range of exercise prices | Weighted Avg. Remaining Range of Exercise Prices for Outstanding at Weighted Avg. Contractual Life Total Intrinsic Outstanding Options March 31, 2023 Exercise Price (in years) Value $23.00 - $28.00 74,663 $ 26.29 3.0 $ 2,987 $28.00 - $32.00 14,073 $ 29.84 2.3 513 $32.00 - $47.00 122,966 $ 44.13 6.8 2,725 211,702 $ 36.89 5.2 $ 6,225 Vested options 143,561 $ 32.82 4.4 $ 4,805 |
Summary of company's common dividends | For the three months ended March 31, 2023, the Company’s common dividend was as follows: Quarter Ended Record Date Payment Date Common dividend per share March 31, 2023 March 31, 2023 April 14, 2023 $0.18 For the three months ended March 31, 2022, the Company’s common dividend was as follows: Quarter Ended Record Date Payment Date Common dividend per share March 31, 2022 March 31, 2022 April 15, 2022 $0.16 |
Restricted Stock Units (RSUs) | |
Schedule of unrecognized compensation expense related to nonvested stock options | Balance of 2023 $ 1,084 2024 $ 852 2025 $ 418 2026 $ 29 |
Schedule of compensation expense and related tax benefits for stock options | For the Three Months Ended March 31, 2023 March 31, 2022 Compensation expense $ 503 $ 273 |
Time Based Restricted Stock Units | |
Summary of activity for restricted stock units | Time-based vesting March 31, 2023 March 31, 2022 Number of Grant Date Fair Number of Grant Date Fair Units Value Weighted Avg. Units Value Weighted Avg. Outstanding at beginning of period 22,332 $ 66.56 12,829 $ 64.43 Granted 11,692 $ 63.82 7,991 $ 76.71 Adjustment for dividends 63 $ — 26 $ — Vested and distributed (3,294) $ 67.09 (2,718) $ 63.15 Forfeited — $ — (813) $ 63.15 Outstanding at end of period 30,793 $ 65.33 17,315 $ 70.26 |
Performance Shares | |
Summary of activity for restricted stock units | |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Leases | |
Schedule of future minimum lease payments to be received under noncancelable operating leases | The following is a schedule of minimum future cash rentals on the Company’s operating leases as of March 31, 2023. The schedule does not reflect future rental revenues from the renewal or replacement of existing leases or for leases on facilities not yet in service and excludes real estate taxes and property operating expense reimbursements: Balance of 2023 $ 30,509 2024 40,781 2025 37,390 2026 29,903 2027 21,383 Thereafter 57,221 $ 217,187 |
Schedule of maturities of lease liabilities | Balance of 2023 $ 245 2024 330 2025 332 2026 310 2027 197 Thereafter 1,028 Total undiscounted payments 2,442 Less: imputed interest (354) Present value of minimum lease payments $ 2,088 |
Supplemental Financial Statem_2
Supplemental Financial Statement Information (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Supplemental Financial Statement Information | |
Schedule of other assets | March 31, 2023 December 31, 2022 Deposits on building and land acquisitions $ 14,488 $ 15,588 Straight-line rents 7,789 7,547 Deferred leasing costs, net 7,076 7,118 Intangible assets, net 5,502 5,813 Prepaid expenses 2,642 3,497 Accounts receivable (primarily leases) 2,347 2,790 Right-of-use assets 2,057 2,123 Furniture, fixtures and equipment, net 1,741 1,791 Deferred financing costs related to revolving lines of credit 572 631 Registration statement costs 341 341 Prepaid development costs 32 88 Other 444 447 Total other assets $ 45,031 $ 47,774 |
Schedule of accounts payable and accrued liabilities | March 31, 2023 December 31, 2022 Accrued construction costs and retainage $ 6,882 $ 5,030 Accrued strategic transaction costs 4,600 615 Trade payables 835 1,528 Accrued real estate taxes 711 25 Accrued salaries, wages and other compensation 579 2,363 Accrued interest payable 419 447 Accrued lease commissions 351 191 Other 738 741 Total accounts payable and accrued liabilities $ 15,115 $ 10,940 |
Schedule of other liabilities | March 31, 2023 December 31, 2022 Deferred compensation plan $ 3,496 $ 3,363 Intangible liability, net 3,086 3,203 Prepaid rent from tenants 2,154 1,449 Lease liabilities 2,088 2,150 Security deposits of tenants 1,304 1,229 Other 139 143 Total other liabilities $ 12,267 $ 11,537 |
Schedule of interest payments and Capitalized interest | Interest payments were as follows: For the Three Months Ended March 31, 2023 March 31, 2022 $ 1,873 $ 1,608 Capitalized interest related to real estate assets was as follows: For the Three Months Ended March 31, 2023 March 31, 2022 $ 267 $ 356 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Narrative (Details) ft² in Millions | 3 Months Ended | |
Mar. 31, 2023 ft² segment building | Feb. 22, 2023 $ / shares | |
Number of reporting segments | 1 | |
Number of operating segments | 1 | |
Industrial/Logistics Building | ||
Number of properties owned | building | 42 | |
Area of property | ft² | 6.1 | |
Proposed Merger | ||
Share Price | $ / shares | $ 67 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Discontinued Operations (Details) $ in Thousands | 1 Months Ended | 3 Months Ended |
Dec. 31, 2022 ft² building | Mar. 31, 2022 USD ($) | |
Real Estate Properties [Line Items] | ||
Gain on disposition of property | $ | $ 203 | |
Office/Flex Portfolio Division | ||
Real Estate Properties [Line Items] | ||
Number of planned development buildings | building | 7 | |
Area of building | ft² | 18,000 | |
Gain on disposition of property | $ | $ 203 | |
Office/Flex Portfolio Division | Industrial/Logistics Building | ||
Real Estate Properties [Line Items] | ||
Area of building | ft² | 175,000 |
Fair Value (Details)
Fair Value (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Financial assets and liabilities carried at fair value and measured at fair value on a recurring basis: | ||
Interest rate swap assets | $ 4,504 | $ 6,971 |
Recurring basis | Significant Observable Inputs (Level 2) | ||
Financial assets and liabilities carried at fair value and measured at fair value on a recurring basis: | ||
Interest rate swap assets | 4,504 | 6,971 |
Carrying Value | ||
Financial assets and liabilities carried at fair value and measured at fair value on a recurring basis: | ||
Fair value of debt | 167,912 | 168,366 |
Estimated Fair Value | ||
Financial assets and liabilities carried at fair value and measured at fair value on a recurring basis: | ||
Fair value of debt | $ 166,571 | $ 166,665 |
Real Estate Assets and Discon_3
Real Estate Assets and Discontinued Operations - Components of Real Estate Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Real Estate Assets and Discontinued Operations | |||
Land | $ 90,927 | $ 71,148 | |
Land improvements | 79,071 | 78,974 | |
Buildings and improvements | 380,899 | 379,864 | |
Tenant improvements | 33,031 | 32,753 | |
Construction in progress | 32,748 | 21,419 | |
Development costs | 3,722 | 3,722 | |
Real estate assets, gross | 620,398 | 587,880 | |
Accumulated depreciation | (102,585) | (98,219) | |
Real estate assets, net | 517,813 | $ 489,661 | |
Depreciation expense | $ 4,413 | $ 3,637 | |
Land improvements | Minimum | |||
Real Estate Assets and Discontinued Operations | |||
Estimated Useful Lives | 10 years | ||
Land improvements | Maximum | |||
Real Estate Assets and Discontinued Operations | |||
Estimated Useful Lives | 30 years | ||
Buildings and improvements | Minimum | |||
Real Estate Assets and Discontinued Operations | |||
Estimated Useful Lives | 10 years | ||
Buildings and improvements | Maximum | |||
Real Estate Assets and Discontinued Operations | |||
Estimated Useful Lives | 40 years |
Real Estate Assets and Discon_4
Real Estate Assets and Discontinued Operations - Acquisitions and Dispositions (Details) $ in Thousands | 1 Months Ended | ||||
Jan. 24, 2023 USD ($) ft² a | Jan. 23, 2023 USD ($) ft² a building | Jan. 19, 2022 USD ($) ft² | Dec. 31, 2022 USD ($) ft² building | Mar. 31, 2023 USD ($) | |
Real Estate Properties [Line Items] | |||||
Land | $ 71,148 | $ 90,927 | |||
Land improvements | 78,974 | 79,071 | |||
Buildings and improvements | 379,864 | 380,899 | |||
Tenant improvements | 32,753 | 33,031 | |||
Real estate assets, net | $ 489,661 | $ 517,813 | |||
Office/Flex Portfolio Division | |||||
Real Estate Properties [Line Items] | |||||
Area of building | ft² | 18,000 | ||||
Number of buildings comprised | building | 7 | ||||
Number of planned development buildings | building | 7 | ||||
Industrial/Logistics Building | Office/Flex Portfolio Division | |||||
Real Estate Properties [Line Items] | |||||
Area of building | ft² | 175,000 | ||||
Lehigh Valley Land | |||||
Real Estate Properties [Line Items] | |||||
Area of building | ft² | 90,000 | ||||
Cash paid for real estate | $ 2,361 | ||||
Area of land | a | 11 | ||||
Orlando Land | |||||
Real Estate Properties [Line Items] | |||||
Area of building | ft² | 574,000 | ||||
Cash paid for real estate | $ 17,418 | ||||
Area of land | a | 75 | ||||
Number of planned development buildings | building | 3 | ||||
782 Paragon Way | |||||
Real Estate Properties [Line Items] | |||||
Land | $ 1,469 | ||||
Land improvements | 329 | ||||
Buildings and improvements | 22,228 | ||||
Real estate assets, net | 24,026 | ||||
Cash paid for real estate | $ 24,026 | ||||
Area of land | ft² | 217,000 |
Real Estate Assets and Discon_5
Real Estate Assets and Discontinued Operations - Discontinued operations (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2023 | Mar. 31, 2022 | |
Real Estate Assets and Discontinued Operations | |||
Gain on disposition of property | $ 203 | ||
Income from Discontinued Operations | |||
Rental Revenue | $ 504 | ||
Operating expenses of rental properties | 268 | ||
Real estate taxes | 82 | ||
Depreciation and amortization expense | 240 | ||
Total expenses | 590 | ||
Loss from discontinued operations | $ (86) | $ (86) | |
Office/Flex Portfolio Division | |||
Real Estate Assets and Discontinued Operations | |||
Gain on disposition of property | $ 203 |
Real Estate Assets and Discon_6
Real Estate Assets and Discontinued Operations - Real Estate Assets Held for Sale (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Real Estate Assets and Discontinued Operations | ||
Other assets | $ 45,031 | $ 47,774 |
Accounts payable and accrued liabilities | 15,115 | 10,940 |
Other liabilities | $ 12,267 | 11,537 |
Real estate assets held for sale | ||
Real Estate Assets and Discontinued Operations | ||
Other assets | 29 | |
Total assets of discontinued operations | 29 | |
Accounts payable and accrued liabilities | 75 | |
Other liabilities | 44 | |
Total liabilities of discontinued operations | $ 119 |
Real Estate Assets and Discon_7
Real Estate Assets and Discontinued Operations - Cash Flows from Discontinued Operations (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Cash Flows From Discontinued Operations | |
Net cash provided by (used in) operating activities of discontinued operations | $ 56 |
Net cash provided by (used in) investing activities of discontinued operations | $ 26 |
Mortgages Loans, Delayed Draw_3
Mortgages Loans, Delayed Draw Term Loan and Interest Rate Swaps (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | ||||
Apr. 01, 2023 USD ($) | Apr. 21, 2022 USD ($) item | May 31, 2022 USD ($) | Mar. 31, 2023 USD ($) item | Mar. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) item | |
Mortgage Loans, Construction Loan, Delayed Draw Term Loan and Interest Rate Swaps | ||||||
Mortgage loans, net of debt issuance costs | $ 79,125 | $ 79,653 | ||||
Debt disclosures | ||||||
Delayed draw term loan, net of debt issuance costs | 88,787 | 88,713 | ||||
Payment on secured debt | 565 | $ 1,076 | ||||
Aggregate book value of land and buildings pledged as collateral | $ 1,741 | 1,791 | ||||
Interest rate swap agreement | ||||||
Debt disclosures | ||||||
Number of agreements containing credit risk related contingent features | item | 0 | |||||
Recognized net gains (losses) (included in other comprehensive loss), before taxes, on interest rate swap agreements | $ 2,467 | 4,662 | ||||
Loss expected to be reclassified over next twelve months from accumulated other comprehensive loss to interest expense | (3,133) | |||||
Interest income | 522 | $ 451 | ||||
Nonrecourse mortgage loans | ||||||
Mortgage Loans, Construction Loan, Delayed Draw Term Loan and Interest Rate Swaps | ||||||
Loans, prior to debt issuance costs | 80,167 | 80,732 | ||||
Debt issuance costs, net | $ (1,042) | $ (1,079) | ||||
Weighted average interest rate | 4.13% | 4.13% | ||||
Delayed Draw Term Loan Facility | ||||||
Mortgage Loans, Construction Loan, Delayed Draw Term Loan and Interest Rate Swaps | ||||||
Debt issuance costs, net | $ (1,213) | |||||
Debt disclosures | ||||||
Maximum borrowing capacity | $ 150,000 | |||||
Term of debt | 5 years | |||||
Proceeds from debt | $ 90,000 | |||||
Interest rate | 4.15% | |||||
Number of separate draws | item | 3 | 2 | ||||
Delayed Draw Term Loan Facility | Subsequent Events | ||||||
Debt disclosures | ||||||
Proceeds from debt | $ 60,000 | |||||
Delayed Draw Term Loan Facility | SOFR | ||||||
Debt disclosures | ||||||
Variable interest rate margin (as a percent) | 1.15% | |||||
Existing Credit Facility | ||||||
Debt disclosures | ||||||
Maximum borrowing capacity | $ 100,000 | |||||
New Credit Facility | ||||||
Debt disclosures | ||||||
Maximum borrowing capacity | $ 250,000 | |||||
New Credit Facility | LIBOR | ||||||
Debt disclosures | ||||||
Variable interest rate margin (as a percent) | 1.20% | |||||
3.97%, due September 1, 2027 | ||||||
Mortgage Loans, Construction Loan, Delayed Draw Term Loan and Interest Rate Swaps | ||||||
Loans, prior to debt issuance costs | $ 10,854 | $ 10,919 | ||||
Interest rate (as a percent) | 3.97% | 3.97% | ||||
4.57%, due February 1, 2028 | ||||||
Mortgage Loans, Construction Loan, Delayed Draw Term Loan and Interest Rate Swaps | ||||||
Loans, prior to debt issuance costs | $ 16,541 | $ 16,666 | ||||
Interest rate (as a percent) | 4.57% | 4.57% | ||||
3.60%, due January 2, 2030 | ||||||
Mortgage Loans, Construction Loan, Delayed Draw Term Loan and Interest Rate Swaps | ||||||
Loans, prior to debt issuance costs | $ 5,962 | $ 6,007 | ||||
Interest rate (as a percent) | 3.60% | 3.60% | ||||
3.48% due February 1 2030 | ||||||
Mortgage Loans, Construction Loan, Delayed Draw Term Loan and Interest Rate Swaps | ||||||
Loans, prior to debt issuance costs | $ 13,774 | $ 13,879 | ||||
Interest rate (as a percent) | 3.48% | 3.48% | ||||
3.50%, due July 1, 2030 | ||||||
Mortgage Loans, Construction Loan, Delayed Draw Term Loan and Interest Rate Swaps | ||||||
Loans, prior to debt issuance costs | $ 4,743 | $ 4,778 | ||||
Interest rate (as a percent) | 3.50% | |||||
4.33%, due August 1, 2030 | ||||||
Mortgage Loans, Construction Loan, Delayed Draw Term Loan and Interest Rate Swaps | ||||||
Loans, prior to debt issuance costs | $ 15,372 | $ 15,473 | ||||
Interest rate (as a percent) | 4.33% | 4.33% | ||||
4.51%, due April 1, 2034 | ||||||
Mortgage Loans, Construction Loan, Delayed Draw Term Loan and Interest Rate Swaps | ||||||
Loans, prior to debt issuance costs | $ 12,921 | $ 13,010 | ||||
Interest rate (as a percent) | 4.51% | 4.51% |
Mortgages Loans, Delayed Draw_4
Mortgages Loans, Delayed Draw Term Loan and Interest Rate Swaps - Schedule of Notional and Fair Value of Interest Rate Swaps (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Mortgage Loans, Construction Loan, Delayed Draw Term Loan and Interest Rate Swaps | ||
Fair Value Interest Rate Derivative Assets | $ 4,504 | $ 6,971 |
Designated as Hedging Instrument | Cash flow hedges | Interest rate swap agreement | ||
Mortgage Loans, Construction Loan, Delayed Draw Term Loan and Interest Rate Swaps | ||
Current Notional Value | 117,246 | 117,451 |
Fair Value of Interest Rate Derivative Assets/(Liabilities) | 4,504 | 6,971 |
Designated as Hedging Instrument | Cash flow hedges | Interest rate swap agreement | Mortgage due on April 21, 2027 | ||
Mortgage Loans, Construction Loan, Delayed Draw Term Loan and Interest Rate Swaps | ||
Current Notional Value | 90,000 | 90,000 |
Fair Value of Interest Rate Derivative Assets/(Liabilities) | 2,774 | 4,704 |
Designated as Hedging Instrument | Cash flow hedges | Interest rate swap agreement | Mortgage due on March 1, 2027 | ||
Mortgage Loans, Construction Loan, Delayed Draw Term Loan and Interest Rate Swaps | ||
Current Notional Value | 10,204 | 10,290 |
Fair Value of Interest Rate Derivative Assets/(Liabilities) | 378 | 522 |
Designated as Hedging Instrument | Cash flow hedges | Interest rate swap agreement | Mortgage due on February 1, 2028 | ||
Mortgage Loans, Construction Loan, Delayed Draw Term Loan and Interest Rate Swaps | ||
Current Notional Value | 6,337 | 6,376 |
Fair Value of Interest Rate Derivative Assets/(Liabilities) | 190 | 324 |
Designated as Hedging Instrument | Cash flow hedges | Interest rate swap agreement | Mortgage due on January 1, 2030 | ||
Mortgage Loans, Construction Loan, Delayed Draw Term Loan and Interest Rate Swaps | ||
Current Notional Value | 5,962 | 6,007 |
Fair Value of Interest Rate Derivative Assets/(Liabilities) | 487 | 621 |
Designated as Hedging Instrument | Cash flow hedges | Interest rate swap agreement | Mortgage due on July 1, 2030 | ||
Mortgage Loans, Construction Loan, Delayed Draw Term Loan and Interest Rate Swaps | ||
Current Notional Value | 4,743 | 4,778 |
Fair Value Interest Rate Derivative Assets | $ 800 | |
Fair Value of Interest Rate Derivative Assets/(Liabilities) | $ 675 | |
Designated as Hedging Instrument | Cash flow hedges | Interest rate swap agreement | LIBOR | Mortgage due on March 1, 2027 | ||
Mortgage Loans, Construction Loan, Delayed Draw Term Loan and Interest Rate Swaps | ||
Interest Strike Rate | 2.501% | |
Designated as Hedging Instrument | Cash flow hedges | Interest rate swap agreement | LIBOR | Mortgage due on February 1, 2028 | ||
Mortgage Loans, Construction Loan, Delayed Draw Term Loan and Interest Rate Swaps | ||
Interest Strike Rate | 2.782% | |
Designated as Hedging Instrument | Cash flow hedges | Interest rate swap agreement | LIBOR | Mortgage due on January 1, 2030 | ||
Mortgage Loans, Construction Loan, Delayed Draw Term Loan and Interest Rate Swaps | ||
Interest Strike Rate | 1.849% | |
Designated as Hedging Instrument | Cash flow hedges | Interest rate swap agreement | LIBOR | Mortgage due on July 1, 2030 | ||
Mortgage Loans, Construction Loan, Delayed Draw Term Loan and Interest Rate Swaps | ||
Interest Strike Rate | 0.942% | |
Designated as Hedging Instrument | Cash flow hedges | Interest rate swap agreement | SOFR | Mortgage due on April 21, 2027 | ||
Mortgage Loans, Construction Loan, Delayed Draw Term Loan and Interest Rate Swaps | ||
Interest Strike Rate | 2.933% |
Revolving and Delayed Draw Te_2
Revolving and Delayed Draw Term Loan Facility Credit Agreement (Details) $ in Thousands | Apr. 21, 2022 USD ($) property item | Apr. 01, 2023 USD ($) | Mar. 31, 2023 USD ($) | Dec. 31, 2022 item | Aug. 05, 2021 USD ($) |
Revolving and Delayed Draw Term Loan Facility Credit Agreement | |||||
Increased line of credit | $ 250,000 | ||||
LIBOR | Term Borrowings | |||||
Revolving and Delayed Draw Term Loan Facility Credit Agreement | |||||
Interest rate (as a percent) | 1.20% | ||||
SOFR | Revolving Credit Facility | |||||
Revolving and Delayed Draw Term Loan Facility Credit Agreement | |||||
Interest rate (as a percent) | 1.20% | ||||
SOFR | Term Borrowings | |||||
Revolving and Delayed Draw Term Loan Facility Credit Agreement | |||||
Interest rate (as a percent) | 1.15% | ||||
New Credit Facility | |||||
Revolving and Delayed Draw Term Loan Facility Credit Agreement | |||||
Maximum borrowing capacity | $ 250,000 | ||||
Number of extension term | item | 2 | ||||
Renewal term | 1 year | ||||
Increased line of credit | $ 500,000 | ||||
Tangible net worth | $ 319,149 | ||||
Percentage of aggregate increases in the shareholder's equity | 75% | ||||
Threshold percentage of maximum leverage ratio of total indebtedness total assets | 60% | ||||
Standby letters of credit aggregate amount | $ 6,822 | ||||
New Credit Facility | Revolving Credit Facility | |||||
Revolving and Delayed Draw Term Loan Facility Credit Agreement | |||||
Maximum borrowing capacity | $ 100,000 | ||||
New Credit Facility | Through March 31, 2022 | |||||
Revolving and Delayed Draw Term Loan Facility Credit Agreement | |||||
Fixed charge coverage ratio | 1.25 | ||||
New Credit Facility | Through June 30, 2022 | |||||
Revolving and Delayed Draw Term Loan Facility Credit Agreement | |||||
Fixed charge coverage ratio | 1.50 | ||||
New Credit Facility | Through December 31, 2022 | |||||
Revolving and Delayed Draw Term Loan Facility Credit Agreement | |||||
Percentage of maximum secured leverage ratio of total secured indebtedness total assets | 50% | ||||
Minimum borrowing base | $ 75,000 | ||||
New Credit Facility | Through March 31, 2023 | |||||
Revolving and Delayed Draw Term Loan Facility Credit Agreement | |||||
Percentage of maximum secured leverage ratio of total secured indebtedness total assets | 40% | ||||
New Credit Facility | From December 31, 2022 to December 31, 2023 | |||||
Revolving and Delayed Draw Term Loan Facility Credit Agreement | |||||
Minimum borrowing base | $ 125,000 | ||||
New Credit Facility | From June 30, 2021 to December 31, 2023 | |||||
Revolving and Delayed Draw Term Loan Facility Credit Agreement | |||||
Threshold number of industrial unencumbered properties | property | 5 | ||||
New Credit Facility | Through December 31, 2023 | |||||
Revolving and Delayed Draw Term Loan Facility Credit Agreement | |||||
Minimum borrowing base | $ 250,000 | ||||
Threshold number of industrial unencumbered properties | property | 8 | ||||
New Credit Facility | LIBOR | |||||
Revolving and Delayed Draw Term Loan Facility Credit Agreement | |||||
Variable interest rate margin (as a percent) | 1.20% | ||||
Delayed Draw Term Loan Facility | |||||
Revolving and Delayed Draw Term Loan Facility Credit Agreement | |||||
Maximum borrowing capacity | $ 150,000 | ||||
Term of debt | 5 years | ||||
Number of separate draws | item | 3 | 2 | |||
Line of credit borrowings | $ 90,000 | ||||
Delayed Draw Term Loan Facility | Subsequent Events | |||||
Revolving and Delayed Draw Term Loan Facility Credit Agreement | |||||
Line of credit borrowings | $ 60,000 | ||||
Delayed Draw Term Loan Facility | SOFR | |||||
Revolving and Delayed Draw Term Loan Facility Credit Agreement | |||||
Variable interest rate margin (as a percent) | 1.15% | ||||
Existing Credit Facility | |||||
Revolving and Delayed Draw Term Loan Facility Credit Agreement | |||||
Maximum borrowing capacity | $ 100,000 | ||||
Existing Credit Facility | Through December 31, 2022 | |||||
Revolving and Delayed Draw Term Loan Facility Credit Agreement | |||||
Minimum borrowing base | $ 30,000 | ||||
Existing Credit Facility | From December 31, 2022 to December 31, 2023 | |||||
Revolving and Delayed Draw Term Loan Facility Credit Agreement | |||||
Minimum borrowing base | 50,000 | ||||
Existing Credit Facility | Through December 31, 2023 | |||||
Revolving and Delayed Draw Term Loan Facility Credit Agreement | |||||
Minimum borrowing base | $ 100,000 |
Stockholders' Equity - Per Shar
Stockholders' Equity - Per Share Results (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Earnings per share: | ||
Net (loss) income | $ (5,777) | $ 269 |
Weighted average shares outstanding - basic | 10,194,000 | 10,185,000 |
Incremental shares from assumed exercise of stock options and warrants and the grant of restricted stock units | 236,000 | |
Adjusted weighted average shares for computation of diluted per share results | 10,194,000 | 10,421,000 |
Incremental shares from assumed exercise of stock options excluded due to anti-dilutive effect | 167,000 |
Stockholders' Equity - Stock Op
Stockholders' Equity - Stock Option Grants, Activity And Expense (Details) | 3 Months Ended | |
Mar. 31, 2023 individual $ / shares shares | Mar. 31, 2022 $ / shares shares | |
Stockholders' Equity | ||
Granted (in shares) | 0 | 0 |
Other Disclosures | ||
Number of option holders | individual | 14 | |
INDUS stock option plan | ||
Granted (in shares) | 0 | 0 |
Exercised (in shares) | 0 | 0 |
Outstanding at end of period (in shares) | 211,702 | 220,937 |
Weighted Avg. Exercise Price | ||
Outstanding at end of period (in dollars per share) | $ / shares | $ 36.89 | $ 36.47 |
Stockholders' Equity - Range Of
Stockholders' Equity - Range Of Exercise Prices (Details) $ / shares in Units, $ in Thousands | 3 Months Ended |
Mar. 31, 2023 USD ($) $ / shares shares | |
Vested options | |
2009 Stock Option Plan | |
Outstanding at ending of the year (in shares) | shares | 143,561 |
Weighted Avg. Exercise Price (in dollars per share) | $ 32.82 |
Weighted Avg. Remaining Contractual Life | 4 years 4 months 24 days |
Total Intrinsic Value | $ | $ 4,805 |
2009 Stock Option Plan | |
2009 Stock Option Plan | |
Outstanding at ending of the year (in shares) | shares | 211,702 |
Weighted Avg. Exercise Price (in dollars per share) | $ 36.89 |
Weighted Avg. Remaining Contractual Life | 5 years 2 months 12 days |
Total Intrinsic Value | $ | $ 6,225 |
$23.00 - $28.00 | 2009 Stock Option Plan | |
2009 Stock Option Plan | |
Exercise prices, low end of range (in dollars per share) | $ 23 |
Exercise prices, high end of range (in dollars per share) | $ 28 |
Outstanding at ending of the year (in shares) | shares | 74,663 |
Weighted Avg. Exercise Price (in dollars per share) | $ 26.29 |
Weighted Avg. Remaining Contractual Life | 3 years |
Total Intrinsic Value | $ | $ 2,987 |
$28.00 - $32.00 | 2009 Stock Option Plan | |
2009 Stock Option Plan | |
Exercise prices, low end of range (in dollars per share) | $ 28 |
Exercise prices, high end of range (in dollars per share) | $ 32 |
Outstanding at ending of the year (in shares) | shares | 14,073 |
Weighted Avg. Exercise Price (in dollars per share) | $ 29.84 |
Weighted Avg. Remaining Contractual Life | 2 years 3 months 18 days |
Total Intrinsic Value | $ | $ 513 |
$32.00 - $47.00 | 2009 Stock Option Plan | |
2009 Stock Option Plan | |
Exercise prices, low end of range (in dollars per share) | $ 32 |
Exercise prices, high end of range (in dollars per share) | $ 47 |
Outstanding at ending of the year (in shares) | shares | 122,966 |
Weighted Avg. Exercise Price (in dollars per share) | $ 44.13 |
Weighted Avg. Remaining Contractual Life | 6 years 9 months 18 days |
Total Intrinsic Value | $ | $ 2,725 |
Stockholders' Equity - Restrict
Stockholders' Equity - Restricted Stock (Details) - $ / shares | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Time Based Restricted Stock Units | ||
Number of Units | ||
Outstanding at beginning of period (in shares) | 22,332 | 12,829 |
Granted (in shares) | 11,692 | 7,991 |
Adjustment for dividend (in shares) | 63 | 26 |
Vested and distributed (in shares) | (3,294) | (2,718) |
Forfeited (in share) | (813) | |
Outstanding at end of period (in shares) | 30,793 | 17,315 |
Grant Date Fair Value | ||
Outstanding at beginning of period (in per share) | $ 66.56 | $ 64.43 |
Granted (in per share) | 63.82 | 76.71 |
Vested and distributed (in per share) | 67.09 | 63.15 |
Forfeited (in per share) | 63.15 | |
Outstanding at end of period (in per share) | $ 65.33 | $ 70.26 |
Time Based Restricted Stock Units | Employee | ||
Grant Date Fair Value | ||
Vesting period | 3 years | |
Time Based Restricted Stock Units | Non-employee directors. | ||
Grant Date Fair Value | ||
Vesting period | 1 year | |
Performance Shares | ||
Number of Units | ||
Outstanding at beginning of period (in shares) | 15,054 | 8,136 |
Granted (in shares) | 11,685 | 7,999 |
Adjustment for dividend (in shares) | 43 | 16 |
Forfeited (in share) | (1,219) | |
Outstanding at end of period (in shares) | 26,782 | 14,932 |
Grant Date Fair Value | ||
Outstanding at beginning of period (in per share) | $ 89.50 | $ 78.97 |
Granted (in per share) | 73.25 | 100.19 |
Forfeited (in per share) | 79.33 | |
Outstanding at end of period (in per share) | $ 82.26 | $ 90.22 |
Performance Shares | Employee | ||
Grant Date Fair Value | ||
Vesting period | 3 years |
Stockholders' Equity - Compensa
Stockholders' Equity - Compensation Expense & Tax Benefit (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Balance of 2023 | $ 154 | |
2024 | 111 | |
2025 | 15 | |
Compensation expense for stock options | ||
Compensation expense | 503 | $ 273 |
Restricted Stock Units (RSUs) | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Balance of 2023 | 1,084 | |
2024 | 852 | |
2025 | 418 | |
2026 | $ 29 |
Stockholders' Equity - Stock Re
Stockholders' Equity - Stock Repurchases, Special Dividend (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | ||||
Apr. 14, 2023 | Apr. 15, 2022 | Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Cash Dividends | |||||
Dividends Payable | $ 1,835 | $ 1,835 | |||
Common stock dividends | $ 1,835 | $ 1,630 | |||
Common dividend per share (in dollars per share) | $ 0.18 | $ 0.16 | $ 0.18 | $ 0.16 |
Leases - Lessor (Details)
Leases - Lessor (Details) $ in Thousands | Mar. 31, 2023 USD ($) |
Future minimum rental payments to be received under noncancelable leases | |
Balance of 2023 | $ 30,509 |
2024 | 40,781 |
2025 | 37,390 |
2026 | 29,903 |
2027 | 21,383 |
Thereafter | 57,221 |
Total | $ 217,187 |
Leases - Lessee (Details)
Leases - Lessee (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Lease terms | |||
Lease expense | $ 84 | $ 35 | |
Weighted-average remaining lease term | 8 years 3 months 18 days | ||
Weighted-average discount rate | 3.69% | 3.70% |
Leases - Lease Liabilities (Det
Leases - Lease Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Maturities of leases liabilities | ||
Balance of 2023 | $ 245 | |
2024 | 330 | |
2025 | 332 | |
2026 | 310 | |
2027 | 197 | |
Thereafter | 1,028 | |
Total undiscounted payments | 2,442 | |
Less: imputed interest | (354) | |
Present value of minimum lease payments | $ 2,088 | $ 2,150 |
Operating Lease, Liability, Statement of Financial Position [Extensible List] | Other Liabilities. | Other Liabilities. |
Supplemental Financial Statem_3
Supplemental Financial Statement Information - Other And Intangible Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Other Assets | ||
Deposits on building and land acquisitions | $ 14,488 | $ 15,588 |
Straight- line rents | 7,789 | 7,547 |
Deferred leasing costs, net | 7,076 | 7,118 |
Intangible assets, net | 5,502 | 5,813 |
Prepaid expenses | 2,642 | 3,497 |
Account receivable (primarily leases) | 2,347 | 2,790 |
Right-of-use assets | $ 2,057 | $ 2,123 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Total other assets | Total other assets |
Furniture, fixtures and equipment, net | $ 1,741 | $ 1,791 |
Deferred financing costs related to revolving lines of credit | 572 | 631 |
Registration statement costs | 341 | 341 |
Prepaid development costs | 32 | 88 |
Other | 444 | 447 |
Total other assets | $ 45,031 | $ 47,774 |
Supplemental Financial Statem_4
Supplemental Financial Statement Information - Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Accounts Payable and Accrued Liabilities | ||
Accrued construction costs and retainage | $ 6,882 | $ 5,030 |
Accrued strategic transaction costs | 4,600 | 615 |
Trade payables | 835 | 1,528 |
Accrued real estate taxes | 711 | 25 |
Accrued salaries, wages and other compensation | 579 | 2,363 |
Accrued interest payable | 419 | 447 |
Accrued lease commissions | 351 | 191 |
Other | 738 | 741 |
Total accounts payable and accrued liabilities | 15,115 | 10,940 |
Other Liabilities | ||
Deferred compensation plan | 3,496 | 3,363 |
Intangible liability, net | 3,086 | 3,203 |
Prepaid rent from tenants | 2,154 | 1,449 |
Lease liabilities | 2,088 | 2,150 |
Security deposits of tenants | 1,304 | 1,229 |
Other | 139 | 143 |
Total other liabilities | $ 12,267 | $ 11,537 |
Operating Lease, Liability, Statement of Financial Position [Extensible List] | Total other liabilities | Total other liabilities |
Supplemental Financial Statem_5
Supplemental Financial Statement Information - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Supplemental Cash Flow Information | ||
Increase in accounts payable and accrued liabilities related to additions to real estate assets | $ 1,852 | $ 3,401 |
Interest paid | ||
Interest payments | 1,873 | 1,608 |
Interest capitalized included in interest payments | $ 267 | $ 356 |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Thousands | 3 Months Ended | |||||
Mar. 02, 2022 USD ($) ft² | Nov. 23, 2021 USD ($) ft² | Nov. 03, 2021 USD ($) ft² | Aug. 05, 2021 USD ($) ft² building | Mar. 31, 2023 USD ($) ft² | Jan. 17, 2022 USD ($) a | |
Under Construction Industrial Logistic Portfolio, Nashville, Tennessee | Forward Purchase Agreement | ||||||
Purchase and sale obligations | ||||||
Area Of Building | ft² | 184,000 | |||||
Purchase Price Before Transaction Costs | $ 31,500 | |||||
Number of Buildings Comprised | building | 2 | |||||
Reduced purchase price | $ 28,350 | |||||
Under-construction building in Greenville-Spartanburg, South Carolina | Agreement to Acquire Property | ||||||
Purchase and sale obligations | ||||||
Purchase price | $ 28,500 | |||||
Area Of Building | ft² | 284,400 | |||||
Undeveloped land in the Charlotte, North Carolina market | Land Purchase Agreement | ||||||
Purchase and sale obligations | ||||||
Area of land | a | 231 | |||||
Purchase Price Before Transaction Costs | $ 4,750 | |||||
Building in Charleston, South Carolina | Forward Purchase Agreement | ||||||
Purchase and sale obligations | ||||||
Area Of Building | ft² | 263,000 | |||||
Purchase Price Before Transaction Costs | $ 28,000 | |||||
Building in the Charlotte, North Carolina market | Forward Purchase Agreement | ||||||
Purchase and sale obligations | ||||||
Area Of Building | ft² | 231,000 | |||||
Purchase Price Before Transaction Costs | $ 21,200 | |||||
Obligations For Investments In Real Estate Assets | ||||||
Purchase and sale obligations | ||||||
Purchase obligations | $ 12,785 | |||||
Area Of Building | ft² | 206,000 |
Subsequent Events (Details)
Subsequent Events (Details) $ in Thousands | Jan. 24, 2023 USD ($) ft² a | Jan. 23, 2023 USD ($) ft² a | Apr. 01, 2023 USD ($) | Mar. 31, 2023 USD ($) |
Orlando Land | ||||
Subsequent Events | ||||
Area of Land | a | 75 | |||
Purchase price | $ 17,418 | |||
Area of building | ft² | 574,000 | |||
Lehigh Valley Land | ||||
Subsequent Events | ||||
Area of Land | a | 11 | |||
Purchase price | $ 2,361 | |||
Area of building | ft² | 90,000 | |||
Delayed Draw Term Loan Facility | ||||
Subsequent Events | ||||
Line of credit borrowings | $ 90,000 | |||
Subsequent Events | Delayed Draw Term Loan Facility | ||||
Subsequent Events | ||||
Line of credit borrowings | $ 60,000 |