American Realty Investors (ARL) 10-Q 14 Aug 18 2018 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2018	Aug. 14, 2018
Document And Entity Information
Entity Registrant Name	AMERICAN REALTY INVESTORS INC
Entity Central Index Key	1,102,238
Document Type	10-Q
Trading Symbol	ARL
Document Period End Date	Jun. 30, 2018
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity's Reporting Status Current	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		15,997,076
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2,018

CONSOLIDATED BALANCE SHEETS (Un

CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Assets
Real estate, at cost	$ 1,147,612	$ 1,117,429
Real estate subject to sales contracts at cost	46,262	48,234
Less accumulated depreciation	(183,630)	(177,546)
Total real estate	1,010,244	988,117
Notes and interest receivable:
Performing (including $104,665 in 2018 and $99,410 in 2017 from related parties)	142,277	127,865
Less allowance for estimated losses (including $14,269 in 2018 and 2017 from related parties)	(15,770)	(15,770)
Total notes and interest receivable	126,507	112,095
Cash and cash equivalents	28,116	42,920
Restricted cash	64,652	45,618
Investments in unconsolidated joint ventures and investees	6,993	6,396
Receivable from related party	55,987	38,311
Other assets	56,605	63,263
Total assets	1,349,104	1,296,720
Liabilities:
Notes and interest payable	921,461	898,750
Notes related to real estate held for sale	376	376
Notes related to real estate subject to sales contracts		1,957
Bond and interest payable	143,897	113,049
Deferred revenue (including $57,289 in 2018 and $56,887 in 2017 to related parties)	78,548	77,332
Accounts payable and other liabilities (including $9,764 in 2018 and $11,893 in 2017 to related parties)	31,655	39,373
Total liabilities	1,175,937	1,130,837
Shareholders' equity:
Preferred stock, Series A: $2.00 par value, authorized 15,000,000 shares, issued and outstanding 1,800,614 and 2,000,614 shares in 2018 and 2017 (liquidation preference $10 per share), including 900,000 shares in 2018 and 2017 held by ARL.	1,805	2,205
Common stock, $0.01 par value, 100,000,000 shares authorized; 16,412,861 shares issued and 15,997,076 outstanding as of 2018 and 15,930,145 shares issued and 15,514,360 outstanding as of 2017, including 140,000 shares held by TCI (consolidated) in 2018 and 2017.	164	159
Treasury stock at cost; 415,785 shares in 2018 and 2017, and 140,000 shares held by TCI (consolidated) as of 2018 and 2017	(6,395)	(6,395)
Paid-in capital	111,907	110,138
Retained earnings	11,161	5,967
Total American Realty Investors, Inc. shareholders' equity	118,642	112,074
Non-controlling interest	54,525	53,809
Total shareholders' equity	173,167	165,883
Total liabilities and shareholders' equity	$ 1,349,104	$ 1,296,720

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Performing	$ 142,277	$ 127,865
Allowance for doubtful accounts	15,770	15,770
Deferred revenue from sales to related parties	78,548	77,332
Accounts payable and other liabilities to related parties	$ 31,655	$ 39,373
Series A Preferred stock, par value (in dollars per share)	$ 2	$ 2
Series A Preferred stock, authorized (in shares)	15,000,000	15,000,000
Series A Preferred stock, issued (in shares)	1,800,614	2,000,614
Series A Preferred stock, outstanding (in shares)	1,800,614	2,000,614
Series A Preferred stock, liquidation preference (in dollars per share)	$ 10	$ 10
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, authorized (in shares)	100,000,000	100,000,000
Common stock, issued (in shares)	16,412,861	15,930,145
Common stock, outstanding (in shares)	15,997,076	15,514,360
Treasury stock (in shares)		415,785
TCI [Member] | Common Stock [Member]
Shares held by subsidiaries (in shares)	140,000	140,000
Treasury stock (in shares)	415,785	140,000
Series A Cumulative Convertible Preferred Stock [Member]
Shares held by subsidiaries (in shares)	900,000	900,000
Related Party [Member]
Performing	$ 104,665	$ 99,410
Allowance for doubtful accounts	14,269	14,269
Deferred revenue from sales to related parties	57,289	56,887
Accounts payable and other liabilities to related parties	$ 9,764	$ 11,893

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Revenues:
Rental and other property revenues (including $208 and $199 for the three months and $415 and $389 for the six months ended 2018 and 2017, respectively, from related parties)	$ 31,607	$ 31,587	$ 62,690	$ 63,409
Expenses:
Property operating expenses (including $231 and $239 for the three months and $458 and 476 for the six months ended 2018 and 2017, respectively, from related parties)	15,550	15,429	29,974	31,693
Depreciation and amortization	6,504	6,409	12,895	12,739
General and administrative (including $297 and $552 for the three months and $2,437 and $1,295 for the six months ended 2018 and 2017, respectively, from related parties)	2,954	1,995	5,295	4,026
Net income fee to related party	53	77	106	137
Advisory fee to related party	2,929	2,849	5,885	5,508
Total operating expenses	27,990	26,759	54,155	54,103
Net operating income	3,617	4,828	8,535	9,306
Other income (expenses):
Interest income (including $4,832 and $4,972 for the three months and $9,311 and $9,092 for the six months ended 2018 and 2017, respectively, from related parties)	4,882	5,059	9,991	9,852
Other income	7,537	(116)	9,438	1,327
Mortgage and loan interest (including $1,909 and $1,683 for the three months and $3,708 and $3,195 for the six months ended 2018 and 2017, respectively, from related parties)	(15,907)	(17,347)	(31,631)	(34,143)
Foreign currency transaction gain (loss)	5,889	(3,425)	7,645	(3,747)
Earnings from unconsolidated subsidiaries and investees	277	153	597	208
Total other income (expenses)	2,678	(15,676)	(3,960)	(26,503)
Income (loss) before gain on land sales, non-controlling interest, and taxes	6,295	(10,848)	4,575	(17,197)
Gain (loss) on land sales		(476)	1,335	(31)
Net income (loss) from continuing operations before taxes	6,295	(11,324)	5,910	(17,228)
Net income (loss) from continuing operations	6,295	(11,324)	5,910	(17,228)
Net income (loss)	6,295	(11,324)	5,910	(17,228)
Net (income) loss attributable to non-controlling interest	(441)	435	(716)	628
Net income (loss) attributable to American Realty Investors, Inc.	5,854	(10,889)	5,194	(16,600)
Preferred dividend requirement	(225)	(275)	(450)	(550)
Net income (loss) applicable to common shares	$ 5,629	$ (11,164)	$ 4,744	$ (17,150)
Earnings per share - basic:
Net loss from continuing operations (in dollars per share)	$ 0.35	$ (0.72)	$ 0.3	$ (1.11)
Earnings per share - diluted:
Net income (loss) from continuing operations (in dollars per share)	$ 0.35	$ (0.72)	$ 0.3	$ (1.11)
Weighted average common shares used in computing earnings per share (in shares)	15,997,076	15,514,360	15,967,740	15,514,360
Weighted average common shares used in computing diluted earnings per share (in shares)	15,997,076	15,514,360	15,967,740	15,514,360
Net income (loss) from continuing operations	$ 5,854	$ (10,889)	$ 5,194	$ (16,600)
Net income (loss) applicable to American Realty Investors, Inc.	$ 5,854	$ (10,889)	$ 5,194	$ (16,600)

CONSOLIDATED STATEMENTS OF OPE5

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (Parenthetical) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Rental and other property revenues	$ 31,607	$ 31,587	$ 62,690	$ 63,409
Property operating expenses	15,550	15,429	29,974	31,693
General and administrative	2,954	1,995	5,295	4,026
Mortgage and loan interest	15,907	17,347	31,631	34,143
Related Party [Member]
Rental and other property revenues	208	199	415	389
Property operating expenses	231	239	458	476
General and administrative	297	552	2,437	1,295
Interest income	4,832	4,972	9,311	9,092
Mortgage and loan interest	$ 1,909	$ 1,683	$ 3,708	$ 3,195

CONSOLIDATED STATEMENT OF SHARE

CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY (Unaudited) - 6 months ended Jun. 30, 2018 - USD ($) $ in Thousands	Total	Comprehensive Loss [Member]	Preferred Stock [Member]	Common Stock [Member]	Treasury Stock [Member]	Paid-in Capital [Member]	Retained Earnings [Member]	Non-controlling Interest [Member]
Balance, at beginning at Dec. 31, 2017	$ 165,883	$ (67,613)	$ 2,205	$ 159	$ (6,395)	$ 110,138	$ 5,967	$ 53,809
Balance, at beginning (in shares) at Dec. 31, 2017				15,930,145
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	5,910	5,194					5,194	716
Conversion of Series A preferred stock into common stock	1,824		(400)	$ 5		2,219
Conversion of Series A preferred stock into common stock (shares)				482,716
Series A preferred stock dividend ($1.00 per share)	(450)					(450)
Balance, at the end at Jun. 30, 2018	$ 173,167	$ (62,419)	$ 1,805	$ 164	$ (6,395)	$ 111,907	$ 11,161	$ 54,525
Balance, at the end (in shares) at Jun. 30, 2018				16,412,861

CONSOLIDATED STATEMENT OF SHAR7

CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY (Parenthetical)	6 Months Ended
	Jun. 30, 2018$ / shares
Statement of Stockholders' Equity [Abstract]
Series A preferred stock dividend (in dollars per share)	$ 1

CONSOLIDATED STATEMENTS OF COMP

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Consolidated Statements Of Comprehensive Income Loss
Net income (loss)	$ 5,910	$ (17,228)
Total comprehensive income (loss)	5,910	(17,228)
Comprehensive (income) loss attributable to non-controlling interest	(716)	628
Comprehensive income (loss) attributable to American Realty Investors, Inc.	$ 5,194	$ (16,600)

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Cash Flow From Operating Activities:
Net income (loss)	$ 5,910	$ (17,228)
Adjustments to reconcile net income (loss) applicable to common shares to net cash provided by (used in) operating activities:
(Gain) loss on sale of land	(1,335)	31
Depreciation and amortization	12,895	12,739
Amortization of deferred borrowing costs	1,394	2,131
Amortization of bond issuance costs	728	462
Earnings from unconsolidated subsidiaries and investees	(597)	(207)
(Increase) decrease in assets:
Accrued interest receivable	(1,154)	4,053
Other assets	4,791	(477)
Prepaid expense	1,597	(4,195)
Rent receivables	269	(1,669)
Related party receivables	(18,070)	(4,930)
Increase (decrease) in liabilities:
Accrued interest payable	(1,040)	141
Other liabilities	(2,442)	6,781
Net cash provided by (used in) operating activities	2,946	(2,368)
Cash Flow From Investing Activities:
Proceeds from notes receivables	6,541	19,753
Origination of notes receivables	(14,557)	(4,116)
Acquisition of land held for development		(11,440)
Proceeds from sale of income producing properties	2,706
Proceeds from sale of land	3,649	1,596
Improvement of land held for development		(585)
Improvement of income producing properties	(2,725)	(1,895)
Construction and development of new properties	(47,452)	(26,708)
Net cash used in investing activities	(51,838)	(23,395)
Cash Flow From Financing Activities:
Proceeds from bonds	39,399	102,364
Bond issuance costs	(2,022)	6,253
Proceeds from notes payable	44,707	82,865
Recurring payment of principal on notes payable	(11,762)	(12,083)
Payments on maturing notes payable	(16,750)	(113,838)
Deferred financing costs		676
Preferred stock dividends - Series A	(450)	(550)
Net cash provided by financing activities	53,122	65,687
Net increase in cash and cash equivalents	4,230	39,924
Cash and cash equivalents, beginning of period	88,538	55,921
Cash and cash equivalents, end of period	92,768	95,845
Supplemental disclosures of cash flow information:
Cash paid for interest	31,029	28,065
Schedule of noncash investing and financing activities:
Notes receivable received from sale of income-producing properties	31,029	28,065
Seller financing note - acquisition of income-producing properties	31,029	28,065
Notes payable issued on acquisition of income-producing properties	$ 31,029	$ 28,065

ORGANIZATION AND BASIS OF PRESE

ORGANIZATION AND BASIS OF PRESENTATION	6 Months Ended
	Jun. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
ORGANIZATION AND BASIS OF PRESENTATION	NOTE 1. ORGANIZATION AND BASIS OF PRESENTATION Organization As used herein, the terms “ARL”, “the Company”, “we”, “our” or “us” refer to American Realty Investors, Inc., a Nevada corporation, which was formed in 1999. The Company is headquartered in Dallas, Texas and its common stock trades on the New York Stock Exchange (“NYSE”) under the symbol (“ARL”). Over 80% of ARL’s stock is owned by related party entities. ARL and a subsidiary own approximately 78% of the outstanding shares of common stock of Transcontinental Realty Investors, Inc. (“TCI”), a Nevada corporation, whose common stock is traded on the NYSE under the symbol (“TCI”). TCI, a subsidiary of ARL, owns approximately 81.25% of the common stock of Income Opportunity Realty Investors, Inc. (“IOR”). Effective July 17, 2009, IOR’s financial results were consolidated with those of ARL and TCI and their subsidiaries. IOR’s common stock is traded on the NYSE American under the symbol (“IOR”). ARL’s Board of Directors is responsible for directing the overall affairs of ARL and for setting the strategic policies that guide the Company. As of April 30, 2011, the Board of Directors delegated the day-to-day management of the Company to Pillar Income Asset Management, Inc. (“Pillar”), a Nevada corporation, under a written Advisory Agreement that is reviewed annually by ARL’s Board of Directors. The directors of ARL are also directors of TCI and IOR. The Chairman of the Board of Directors of ARL also serves as the Chairman of the Board of Directors of TCI and IOR. The officers of ARL also serve as officers of TCI, IOR and Pillar. ARL invests in real estate through direct ownership, leases and partnerships and also invests in mortgage loans on real estate. Pillar Income Asset Management, Inc. (“Pillar”) is the Company’s external Advisor and Cash Manager. Although the Board of Directors is directly responsible for managing the affairs of ARL, and for setting the policies which guide it, the day-to-day operations of ARL are performed by Pillar, as the contractual Advisor, under the supervision of the Board. Pillar’s duties include, but are not limited to: locating, evaluating and recommending real estate and real estate-related investment opportunities and arranging debt and equity financing for the Company with third party lenders and investors. Additionally, Pillar serves as a consultant to the Board with regard to their decisions in connection with ARL’s business plan and investment policy. Pillar also serves as an Advisor and Cash Manager to TCI and IOR. Regis Realty Prime, LLC (“Regis”) manages our commercial properties and provides brokerage services. ARL engages third-party companies to lease and manage its apartment properties. Properties We own or had interests in a total property portfolio of fifty three income-producing properties as of June 30, 2018. The properties consisted of: ● Seven commercial properties consisting of five office buildings and two retail centers comprising in aggregate approximately 1.7 million rentable square feet; ● Forty-six apartment communities totaling 8,195 units, excluding apartments being developed; and ● 3,492 acres of developed and undeveloped land. We join with various third-party development companies to construct residential apartment communities. We are in the predevelopment process on several residential apartment communities that have not yet begun construction. At June 30, 2018, we had ten apartment projects in development. The third-party developer typically holds a general partner interest in a limited partnership formed for the purpose of building a single property, we generally are a majority of the limited partner interests in the limited partnership. We may contribute land to the partnership as part of our equity contribution or we may contribute the necessary funds to the partnership to acquire the land. We are required to fund all necessary equity contributions while the third-party developer is responsible for obtaining construction financing, hiring a general contractor and for the overall management, successful completion and delivery of the project. We generally bear all the economic risks and rewards of ownership in these partnerships and therefore include these partnerships in our Consolidated Financial Statements. The third-party developer is paid a developer fee typically equal to a percentage of the construction costs. When the project reaches stabilized occupancy, we acquire the third-party developer’s partnership interests in exchange for any remaining unpaid developer fees. Basis of Presentation The accompanying unaudited Consolidated Financial Statements have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted in accordance with such rules and regulations, although management believes the disclosures are adequate to prevent the information presented from being misleading. In the opinion of management, all adjustments (consisting of normal recurring matters) considered necessary for a fair presentation have been included. The results of operations for the three and six months ended June 30, 2018, are not necessarily indicative of the results that may be expected for other interim periods or for the full fiscal year. The year-end Consolidated Balance Sheet at December 31, 2017 was derived from the audited Consolidated Financial Statements at that date, but does not include all of the information and disclosures required by U.S. GAAP for complete financial statements. For further information, refer to the Consolidated Financial Statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017. Certain 2017 Consolidated Financial Statement amounts have been reclassified to conform to the 2018 presentation. Principles of Consolidation The accompanying Consolidated Financial Statements include the accounts of the Company, its subsidiaries, generally all of which are wholly-owned, and all entities in which we have a controlling interest. Arrangements that are not controlled through voting or similar rights are accounted for as a Variable Interest Entity (“VIE”), in accordance with the provisions and guidance of ASC Topic 810, “Consolidation”, whereby we have determined that we are a primary beneficiary of the VIE and meet certain criteria of a sole general partner or managing member as identified in accordance with Emerging Issues Task Force (“EITF”) Issue 04-5, Investor’s Accounting for an Investment in a Limited Partnership when the Investor is the Sole General Partner and the Limited Partners have Certain Rights (“EITF 04-5”). VIEs are generally entities that lack sufficient equity to finance their activities without additional financial support from other parties or whose equity holders as a group lack adequate decision making ability, the obligation to absorb expected losses or residual returns of the entity, or have voting rights that are not proportional to their economic interests. The primary beneficiary is generally the entity that provides financial support and bears a majority of the financial risks, authorizes certain capital transactions, or makes operating decisions that materially affect the entity’s financial results. All significant intercompany balances and transactions have been eliminated in consolidation. In determining whether we are the primary beneficiary of a VIE, we consider qualitative and quantitative factors, including, but not limited to: the amount and characteristics of our investment; the obligation or likelihood for us or other investors to provide financial support; our and the other investors’ ability to control or significantly influence key decisions for the VIE; and the similarity with and significance to the business activities of us and the other investors. Significant judgments related to these determinations include estimates about the current future fair values and performance of real estate held by these VIEs and general market conditions. For entities in which we have less than a controlling financial interest or entities where we are not deemed to be the primary beneficiary, the entities are accounted for using the equity method of accounting. Accordingly, our share of the net earnings or losses of these entities is included in consolidated net income. Our investment in Gruppa Florentina, LLC is accounted for under the equity method. Real Estate, Depreciation and Impairment Real estate assets are stated at the lower of depreciated cost or fair value, if deemed impaired. Major replacements and betterments are capitalized and depreciated over their estimated useful lives. Depreciation is computed on a straight-line basis over the useful lives of the properties (buildings and improvements: 10-40 years; furniture, fixtures and equipment: 5-10 years). The Company continually evaluates the recoverability of the carrying value of its real estate assets using the methodology prescribed in ASC Topic 360 (“ASC 360”), “Property, Plant and Equipment”. Factors considered by management in evaluating impairment of its existing real estate assets held for investment include significant declines in property operating profits, annually recurring property operating losses and other significant adverse changes in general market conditions that are considered permanent in nature. Under ASC 360, a real estate asset held for investment is not considered impaired if the undiscounted, estimated future cash flows of an asset (both the annual estimated cash flow from future operations and the estimated cash flow from the theoretical sale of the asset) over its estimated holding period are in excess of the asset’s net book value at the balance sheet date. If any real estate asset held for investment is considered impaired, a loss is provided to reduce the carrying value of the asset to its estimated fair value. Real Estate Held For Sale We periodically classify real estate assets as “held for sale.” An asset is classified as held for sale after the approval of our Board of Directors, after an active program to sell the asset has commenced and if the sale is probable. One of the deciding factors in determining whether a sale is probable is whether the firm purchase commitment is obtained and whether the sale is probable within the year. Upon the classification of a real estate asset as held for sale, the carrying value of the asset is reduced to the lower of its net book value or its estimated fair value, less costs to sell the asset. Subsequent to the classification of assets as held for sale, no further depreciation expense is recorded. Real estate assets held for sale are stated separately on the accompanying Consolidated Balance Sheets. Upon a decision that the sale is no longer probable, the asset is classified as an operating asset and depreciation expense is reinstated. Prior to January 1, 2015, the operating results of real estate assets held for sale and sold were reported as discontinued operations in the accompanying Consolidated Statements of Operations. Income from discontinued operations includes the revenues and expenses, including depreciation and interest expense, associated with the assets. Effective January 1, 2015, Accounting Standards Update 2014-08, “Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity” (“ASU 2014-08”) substantially changed the criteria for determining whether a disposition qualifies for discontinued operations presentation. Since the Company adopted ASU 2014-08, effective January 1, 2015, we have had no dispositions that met the discontinued operations criteria. Cost Capitalization Costs related to planning, developing, leasing and constructing a property are capitalized and classified as Real Estate in the Consolidated Balance Sheets. We capitalize interest to qualifying assets under development based on average accumulated expenditures outstanding during the period. In capitalizing interest to qualifying assets, we first use the interest incurred on specific project debt, if any, and next use the weighted average interest rate of non-project specific debt. We capitalize interest, real estate taxes and certain operating expenses until building construction is substantially complete and the building is ready for its intended use, but no later than one year from the cessation of major construction activity. We capitalize leasing costs which include commissions paid to outside brokers, legal costs incurred to negotiate and document a lease agreement and any internal costs that may be applicable. We allocate these costs to individual tenant leases and amortize them over the related lease term. Fair Value Measurement We apply the guidance in ASC Topic 820, “Fair Value Measurements and Disclosures”, to the valuation of real estate assets. These provisions define fair value as the price that would be received to sell an asset or paid to transfer a liability in a transaction between market participants at the measurement date, establish a hierarchy that prioritizes the information used in developing fair value estimates and require disclosure of fair value measurements by level within the fair value hierarchy. The hierarchy gives the highest priority to quoted prices in active markets (Level 1 measurements) and the lowest priority to unobservable data (Level 3 measurements), such as the reporting entity’s own data. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date and includes three levels defined as follows: Level 1 – Unadjusted quoted prices for identical and unrestricted assets or liabilities in active markets. Level 2 – Quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. Level 3 – Unobservable inputs that are significant to the fair value measurement. A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Deferred Costs Costs relating to the financing of properties are deferred and amortized over the life of the related financing agreement. Amortization is reflected as interest expense in the Consolidated Statements of Operations, with remaining terms ranging from 6 months to 40 years. Unamortized financing costs are written off when the financing agreement is extinguished before the maturity date. Related Parties We apply ASC Topic 805, “Business Combinations”, to evaluate business relationships. Related parties are persons or entities who have one or more of the following characteristics, which include entities for which investments in their equity securities would be required, trust for the benefit of persons including principal owners of the entities and members of their immediate families, management personnel of the entity and members of their immediate families and other parties with which the entity may deal if one party controls or can significantly influence the decision making of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests, or affiliates of the entity. Newly Issued Accounting Standards In May 2014, Accounting Standards Update (“ASU”) No. 2014-09 (“ASU 2014-09”), “Revenue from Contracts with Customers,” was issued. This new guidance established a new single comprehensive revenue recognition model and provides for enhanced disclosures. Under the new policy, the nature, timing and amount of revenue recognized for certain transactions could differ from those recognized under existing accounting guidance. This new standard does not affect revenue recognized under lease contracts. ASU 2014-09 is effective for reporting periods beginning after December 15, 2017. The Company does not believe the adoption of this guidance had a material impact on its financial statements. In February 2016, FASB issued ASU 2016-02 (“ASU 2016-02”), Leases. This guidance establishes a new model for accounting for leases and provides for enhanced disclosures. ASU 2016-02 is effective for reporting periods beginning after December 15, 2018. The Company is currently evaluating the impact of the adoption of ASU 2016-02 on its financial position and results of operations, if any. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments, which addresses how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The ASU is effective for fiscal years beginning after December 15, 2017, including interim periods within those years; however, early adoption is permitted. Entities must apply the guidance retrospectively to all periods presented but may apply it prospectively if retrospective application would be impracticable. The Company adopted this standard effective on January 1, 2018. ASU 2016-15 will impact our presentation of operating, investing and financing activities related to certain cash receipts and payments on our consolidated statements of cash flows. In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash, which clarifies guidance on the classification and presentation of changes in restricted cash. The ASU is effective for reporting periods beginning after December 15, 2017, with early adoption permitted, and will be applied retrospectively to all periods presented. Upon adoption, restricted cash balances will be included along with cash and cash equivalents as of the end of the period and beginning period, respectively, in the Company’s consolidated statement of cash flows for all periods presented. Upon adoption, separate line items showing changes in restricted cash balances will be eliminated from the Company’s consolidated statement of cash flows. The Company adopted this guidance effective on January 1, 2018. ASU 2016-18 will impact our presentation of operating, investing and financing activities related to restricted cash on our consolidated statements of cash flows. In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business, which clarifies the definition of a business when evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The ASU is effective for reporting periods beginning after December 15, 2017, with early adoption permitted. The Company expects that acquisitions of real estate or in-substance real estate will not meet the revised definition of a business and thus will be treated as asset acquisitions. Acquisition costs for those acquisitions that are not businesses will be capitalized rather than expensed. The Company adopted this guidance effective January 1, 2018. The Company does not believe the adoption of this guidance will have a material impact on its consolidated financial statements. In February 2017, the FASB issued ASU 2017-05, Other Income – Gains and Losses from the Derecognition of Nonfinancial Assets (Topic 610-20), which requires that all entities account for the derecognition of a business in accordance with ASC 810, including instances in which the business is considered in-substance real estate. The ASU requires the Company to measure at fair value any retained interest in a partial sale of real estate. The ASU is effective for annual periods, and interim periods therein, beginning after December 15, 2017. The Company adopted ASU 2017-05 effective January 1, 2018. The Company does not believe the adoption of this guidance will have a material impact on its consolidated financial statements.

REAL ESTATE ACTIVITY

REAL ESTATE ACTIVITY	6 Months Ended
	Jun. 30, 2018
Real Estate [Abstract]
REAL ESTATE ACTIVITY	NOTE 2. REAL ESTATE ACTIVITY Below is a summary of the real estate owned as of June 30, 2018 (dollars in thousands): Apartments $ 730,045 Apartments under construction 152,943 Commercial properties 202,367 Land held for development 62,257 Real estate subject to sales contract 46,262 Total real estate $ 1,193,874 Less accumulated depreciation (183,630 ) Total real estate, net of depreciation $ 1,010,244 The highlights of our significant real estate transactions for the six months ended June 30, 2018 are listed below: Purchases During the six months ended June 30, 2018, the Company purchased through one of its subsidiaries, an 80 unit residential apartment community located in Baton Rouge, LA for a total purchase price of $12 million, paid through a seller’s financing note of $1.9 million, issuance of a note payable of $8.6 million, and by exercising an option to purchase of $1.5 million paid in the previous year. Sales During the six months ended June 30, 2018, ARL sold 112.2 acres of land to an independent third party for a total sales price of $7.2 million. We recorded an aggregate gain of $1.3 million from the land sale. Also, for the quarter just ended, the Company sold a golf course comprising approximately 96.09 acres for an aggregate sales price of $2.3 million, out of which, $0.6 million was received in cash and $1.7 million in note receivables. In addition, during the first quarter we sold six income-producing properties to a related party for an aggregate purchase price of $8.5 million, out of which, $2.1 million was received in cash and $6.4 million in note receivables. No gain or loss was recorded from the sale of income-producing properties. As of June 30, 2018, the Company has approximately 91 acres of land, at various locations that were sold to related parties in multiple transactions. These transactions are treated as “subject to sales contract” on the Consolidated Balance Sheets. Due to the related party nature of the transactions, TCI has deferred the recording of the sales in accordance with ASC 360-20. We continue to invest in the development of apartment projects. During the six months ended June 30, 2018, we have invested $47.5 million related to the construction or predevelopment of various apartment complexes and capitalized $3.5 million of interest costs.

SUPPLEMENTAL CASH FLOW INFORMAT

SUPPLEMENTAL CASH FLOW INFORMATION	6 Months Ended
	Jun. 30, 2018
Supplemental Cash Flow Elements [Abstract]
SUPPLEMENTAL CASH FLOW INFORMATION	NOTE 3. SUPPLEMENTAL CASH FLOW INFORMATION For the six months ended June 30, 2018 and 2017, the Company paid interest expense of $31.0 million and $28.1 million, respectively. Cash and cash equivalents, and restricted cash for the six months ended June 30, 2018 and 2017 was $92.8 million and $95.8 million, respectively. The following is a reconciliation of the Company’s cash and cash equivalents, and restricted cash to the total presented in the consolidated statement of cash flows: June 30, 2018 2017 Cash and cash equivalents $ 28,116 $ 58,260 Restricted cash (cash held in escrow) 49,760 33,448 Restricted cash (certificate of deposits) 9,162 - Restricted cash (held with Trustee) 5,730 4,137 $ 92,768 $ 95,845 Amounts included in restricted cash represent funds required to be set aside to meet contractual obligations with certain financial institutions for the payment of reserve replacement and tax and insurance escrow. In addition, restricted cash includes funds with the Bond’s Trustee for payment of interest.

NOTES AND INTEREST RECEIVABLE

NOTES AND INTEREST RECEIVABLE	6 Months Ended
	Jun. 30, 2018
Receivables [Abstract]
NOTES AND INTEREST RECEIVABLE	NOTE 4. NOTES AND INTEREST RECEIVABLE A portion of our assets are invested in mortgage notes receivable, principally secured by real estate. We may originate mortgage loans in conjunction with providing purchase money financing of property sales. Notes receivable are generally collateralized by real estate or interests in real estate and guarantees, unless noted otherwise, are so secured. Management intends to service and hold for investment the mortgage notes in our portfolio. A majority of the notes receivable provide for principal to be paid at maturity. Below is a summary of our notes receivable as of June 30, 2018 (dollars in thousands): Borrower Maturity Date Interest Rate Amount Security Performing loans: H198, LLC (Las Vegas Land) 01/20 12.00% $ 5,907 Secured Leman Development, Ltd (2) N/A 0.00% 1,500 Unsecured Oulan-Chikh Family Trust 03/21 8.00% 174 Secured H198, LLC (McKinney Ranch Land) 09/18 6.00% 4,554 Secured 2818 Ventures LLC (Forest Pines) 11/18 5.00% 2,223 Secured ABC Land & Development (Mandahl Bay) 05/38 6.00% 1,735 Secured Unified Housing Foundation, Inc. (Echo Station) (1) 12/32 12.00% 1,481 Secured Unified Housing Foundation, Inc. (Inwood on the Park) (1) 12/32 12.00% 3,639 Secured Unified Housing Foundation, Inc. (Kensington Park) (1) 12/32 12.00% 3,933 Secured Unified Housing Foundation, Inc. (Lakeshore Villas) (1) 12/32 12.00% 2,000 Secured Unified Housing Foundation, Inc. (Lakeshore Villas) (1) 12/32 12.00% 9,101 Secured Unified Housing Foundation, Inc. (Limestone Ranch) (1) 12/32 12.00% 1,953 Secured Unified Housing Foundation, Inc. (Limestone Ranch) (1) 12/32 12.00% 6,000 Secured Unified Housing Foundation, Inc. (Reserve at White Rock Phase I) (1) 12/32 12.00% 2,485 Secured Unified Housing Foundation, Inc. (Reserve at White Rock Phase II) (1) 12/32 12.00% 2,555 Secured Unified Housing Foundation, Inc. (Timbers of Terrell) (1) 12/32 12.00% 1,323 Secured Unified Housing Foundation, Inc. (Tivoli) (1) 12/32 12.00% 7,965 Secured Unified Housing Foundation, Inc. (Trails at White Rock) (1) 12/32 12.00% 3,815 Secured Unified Housing Foundation, Inc. (1) 12/18 12.00% 3,994 Unsecured Unified Housing Foundation, Inc. (1) 12/18 12.00% 6,407 Unsecured Unified Housing Foundation, Inc. (1) 06/20 12.00% 5,760 Unsecured Unified Housing Foundation, Inc. (1) 03/21 12.00% 5,314 Unsecured One Realco Corporation (1,2) 01/20 3.00% 7,000 Unsecured Realty Advisors Management, Inc. (1) 12/19 2.28% 20,387 Unsecured Other related party notes Various Various 1,349 Various secured interests Other related party notes Various Various 510 Various unsecured interests Other non-related party notes Various Various 3,466 Various secured interests Other non-related party notes Various Various 14,639 Various unsecured interests Accrued interest 11,108 Total Performing $ 142,277 Allowance for estimated losses (15,770 ) Total $ 126,507 (1) (2) We invest in mortgage loans, secured by mortgages that are subordinate to one or more prior liens either on the fee or a leasehold interest in real estate. Recourse on such loans ordinarily includes the real estate on which the loan is made, other collateral and guarantees. At June 30, 2018, we had mortgage loans and accrued interest receivable from related parties, net of allowances, totaling $104.7 million. We recognized interest income of $4.9 million related to these notes receivables. The Company has various notes receivable from Unified Housing Foundation, Inc. (“UHF”) and Foundation for Better Housing, Inc. (“FBH”). UHF and FBH are determined to be related parties due to our reliance upon the performance of the collateral secured under the notes receivable. Payments are due from surplus cash flow of operations of the properties. A sale or refinance of any of the properties underlying these notes will be used to repay outstanding interest and principal for the remaining notes for the specific borrower. These notes are cross-collateralized for the specific borrower, but to the extent cash is received from a specific UHF or FBH property, it is applied first against any outstanding interest for the related-property note. The allowance on the UHF notes was a purchase allowance that was netted against the notes when acquired.

INVESTMENT IN UNCONSOLIDATED IN

INVESTMENT IN UNCONSOLIDATED INVESTEES	6 Months Ended
	Jun. 30, 2018
Equity Method Investments and Joint Ventures [Abstract]
INVESTMENT IN UNCONSOLIDATED INVESTEES	NOTE 5. INVESTMENT IN UNCONSOLIDATED INVESTEES Investments in unconsolidated investees in which we have a 20% to 50% interest or otherwise exercise significant influence are carried at cost and adjusted for the Company’s proportionate share of their undistributed earnings or losses under the equity method of accounting. Investments in unconsolidated investees consist of the following: Percentage ownership as of June 30, 2018 June 30, 2017 Gruppa Florentina, LLC 20.00 % 20.00 % Gruppa Florentina, LLC is the sole shareholder of Milano Restaurants International Corporation, (“Milano”) which operates 33 pizza parlors under the trade name “Me-N-Ed’s Pizza Parlors” and four pizza parlors operating under the trade name “Blast 825 Pizza”, located primarily in Central and Northern California. Milano has a 100% ownership interest in Siena Corp, which operates two grills under the trade names “Me-N-Ed’s Victory Grill” and “Me-N-Ed’s Coney Island Grill”. Milano has a 100% ownership interest in Piazza del Pane, Inc., which operates two restaurants located in Central California. Milano also has 23 franchised locations, including two operating, under the trade name Angelo & Vito’s Pizzerias. The following is a summary of the financial position and results of operations from our investees (dollars in thousands): As of June 30, 2018 2017 Real estate, net of accumulated depreciation $ 13,485 $ 13,578 Notes receivable 10,918 9,969 Other assets 32,290 30,188 Notes payable (10,745 ) (9,514 ) Other liabilities (7,775 ) (7,821 ) Shareholders’ equity (38,173 ) (36,400 ) For the Six Months Ended June 30, 2018 2017 Revenue $ 27,195 $ 27,458 Depreciation (728 ) (575 ) Operating expenses (25,630 ) (25,533 ) Interest expense (340 ) (353 ) Income from continuing operations 497 497 Net income $ 497 $ 997 Company’s proportionate share of earnings $ 99 $ 199

NOTES PAYABLE

NOTES PAYABLE	6 Months Ended
	Jun. 30, 2018
Debt Disclosure [Abstract]
NOTES PAYABLE	NOTE 6. NOTES PAYABLE Below is a summary of our notes and interest payable as of June 30, 2018 (dollars in thousands): Notes Payable Accrued Interest Total Debt Apartments $ 568,449 $ 1,585 $ 570,034 Apartments under Construction 118,665 31 118,696 Commercial 125,807 616 126,423 Land 21,734 197 21,931 Real estate subject to sales contract 376 — 376 Mezzanine financing 93,422 509 93,931 Other 8,882 (593 ) 8,289 Total $ 937,335 $ 2,345 $ 939,680 Unamortized deferred borrowing costs (17,843 ) — (17,843 ) $ 919,492 $ 2,345 $ 921,837 The segment labeled as “Other” consists of unsecured or stock-secured notes payable. There are various land mortgages, secured by the property, that are in the process of a modification or extension to the original note due to expiration of the loan. We are in constant contact with these lenders, working together in order to modify the terms of these loans and we anticipate a timely resolution that is similar to the existing agreement or subsequent modification. In conjunction with the development of various apartment projects and other developments, we drew down $44.7 million in construction loans during the six months ended June 30, 2018. The properties that we have sold to a related party and have deferred the recognition of the sale are treated as “subject to sales contract” on the Consolidated Balance Sheets. These properties were sold to a related party in order to help facilitate an appropriate debt or organizational restructure and may or may not be transferred back to the seller upon resolution. These properties have mortgages that are secured by the property and many have corporate guarantees. According to the loan documents, the maker is currently in default on these mortgages primarily due to lack of payment and is actively involved in discussions with every lender in order to settle or cure the default situation. We have reviewed each asset and taken impairment to the extent we feel the value of the property was less than our current basis.

BONDS PAYABLE

BONDS PAYABLE	6 Months Ended
	Jun. 30, 2018
Series Bonds Payable
BONDS PAYABLE	NOTE 7. BONDS PAYABLE In August 2016 Southern Properties Capital LTD (“Southern”), a British Virgin Islands corporation was incorporated for the purpose of raising funds by issuing Bonds to be traded on the Tel Aviv Stock Exchange (“TASE”). TCI transferred certain residential and commercial properties located in the United States to Southern, its wholly owned subsidiary. On February 13, 2017, Southern filed a final prospectus with the TASE for an offering and sale of nonconvertible Series A Bonds to be issued by Southern. The bonds are obligations of Southern. During the year ended December 31, 2017 on three separate occasions Southern issued nonconvertible Series A Bonds with a total value of approximately NIS400 million New Israeli Shekels (“NIS”) or approximately $115 million dollars. The Series A Bonds have a stated interest rate of 7.3%. At March 31, 2018 the effective interest rate is 9.17%. The bonds require semi-annual equal installments on January 31 and July 31 of each year from 2019 to 2023 (inclusive). The interest will be repaid on January 31 and July 31 of each of the years 2018 to 2023 (inclusive), with the first payment commencing on July 31, 2017. On January 25, 2018, interest payment of approximately NIS 14.6 million (or approximately $4.3 million) was paid to the Series A bondholders. On February 15, 2018, Southern issued Series B bonds in the amount of NIS 137.7 million par value (approximately $39.2 million as of February 15, 2018). The Series B bonds are registered on the TASE. The bonds are reported in NIS and bear annual interest rate of 6.8%. Interest shall be repaid January 31 and July 31 of each of the years 2019 to 2023 (inclusive), first payment commencing on July 31, 2018. The principal shall be repaid in ten equal installments on January 31 and July 31 of each of the years from 2021 to 2025 (inclusive). The total bond issuance cost of $1.4 million was incurred. The effective interest rate is 7.99%. On July 26, 2018, interest payment of approximately NIS 18.9 million (or approximately $5.2 million) was paid to the Series A and B bondholders. The outstanding balance of these Bonds at June 30, 2018 is as follows: June 30, December 31, 2017 Bonds (Series A) $ 109,552 $ 115,336 Bonds (Series B) 37,726 — Less: deferred issuance expense, net (7,210 ) (5,916 ) Accrued Interest 3,829 3,629 $ 143,897 $ 113,049 The aggregate maturity of the bonds are as follows: Year 2018 $ — 2019 23,067 2020 23,067 2021 23,067 2022 30,903 Thereafter 47,174 $ 147,278 The funds were used primarily for the acquisition and development of additional real estate operations in the United States. The funds were raised and will be repaid in NIS, however the funds raised have been converted to US dollars. The Company records unrealized gains or losses each quarter based upon the relative exchange values of the US dollar and the NIS; however, no gain or loss will be realized until a conversion from US dollars to NIS actually occurs in the future. The recorded unrealized gain or loss is reflected as a separate line item to highlight the fact that it is a non-cash transaction until such time as actual payment of principal and interest on the bonds is made. For the six months ended June 30, 2018, the Company recorded a gain on foreign currency transaction of approximately $7.6 million.

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS	6 Months Ended
	Jun. 30, 2018
Related Party Transactions [Abstract]
RELATED PARTY TRANSACTIONS	NOTE 8. RELATED PARTY TRANSACTIONS The following table reflects the reconciliation of the beginning and ending balances of accounts receivable from and (accounts payable) to related parties as of June 30, 2018 (dollars in thousands): Pillar Related party receivable, December 31, 2017 $ 38,311 Cash transfers 26,033 Advisory fees (5,884 ) Net income fee (106 ) Cost reimbursements (2,346 ) Interest income 1,347 Notes receivable purchased (5,315 ) Fees and commissions (162 ) Expenses (paid) received by Advisor 4,845 Financing (mortgage payments) (169 ) Sales/purchases transactions (567 ) Related party receivable, June 30, 2018 $ 55,987 During the ordinary course of business, we have related party transactions that include, but are not limited to, rental income, interest income, interest expense, general and administrative costs, commissions, management fees, and property expenses. In addition, we have assets and liabilities that include related party amounts. The related party amounts included in assets and liabilities, and the related party revenues and expenses received and paid are shown on the face of the Consolidated Financial Statements.

OPERATING SEGMENTS

OPERATING SEGMENTS	6 Months Ended
	Jun. 30, 2018
Segment Reporting [Abstract]
OPERATING SEGMENTS	NOTE 9. OPERATING SEGMENTS Our segments are based on our method of internal reporting which classifies our operations by property type. Our property types are grouped into commercial properties, apartments, land and other operating segments. Significant differences among the accounting policies of the operating segments as compared to the Consolidated Financial Statements principally involve the calculation and allocation of administrative and other expenses. Management evaluates the performance of each of the operating segments and allocates resources to them based on their net operating income and cash flow. Items of income that are not reflected in the segments are interest, other income, gain on debt extinguishment, gain on condemnation award, equity in partnerships and gains on sale of real estate. Expenses that are not reflected in the segments are provision for losses, advisory, net income and incentive fees, general and administrative, non-controlling interests and net loss from discontinued operations before gains on sale of real estate. The segment labeled as “Other” consists of revenue and operating expenses related to the notes receivable and corporate debt. Presented below is our reportable segments’ operating income for the three months ended June 30, 2018 and 2017, including segment assets and expenditures (dollars in thousands): For the Three Months Ended June 30, 2018 Commercial Apartments Land Other Total Rental and other property revenues $ 7,404 $ 24,201 $ — $ 2 $ 31,607 Property operating expenses (4,238 ) (11,199 ) (135 ) 22 (15,550 ) Depreciation (2,323 ) (4,195 ) — 14 (6,504 ) Mortgage and loan interest (1,893 ) (5,342 ) 65 (8,737 ) (15,907 ) Interest income — — — 4,882 4,882 Segment operating (loss) income $ (1,050 ) $ 3,465 $ (70 ) $ (3,817 ) $ (1,472 ) Balance Sheet Data Capital expenditures $ 2,092 $ — $ — $ — $ 2,092 Property Sales Sales price $ 2,313 $ — $ — $ — $ 2,313 Cost of sale (2,313 ) — — — (2,313 ) Gain (loss) on sale $ — $ — $ — $ — $ — For the Three Months Ended June 30, 2017 Commercial Apartments Land Other Total Rental and other property revenues $ 8,553 $ 23,030 $ — $ 4 $ 31,587 Property operating expenses (4,900 ) (10,211 ) (168 ) (150 ) (15,429 ) Depreciation (2,397 ) (4,030 ) — 18 (6,409 ) Mortgage and loan interest (2,121 ) (5,028 ) (389 ) (9,809 ) (17,347 ) Interest income — — — 5,059 5,059 Loss on land sales — — (476 ) — (476 ) Segment operating (loss) income $ (865 ) $ 3,761 $ (1,033 ) $ (4,878 ) $ (3,015 ) Balance Sheet Data Capital expenditures $ 557 $ — $ 186 $ — $ 743 Property Sales Sales price $ — $ — $ 507 $ — $ 507 Cost of sale — — (983 ) — (983 ) Loss on sale $ — $ — $ (476 ) $ — $ (476 ) The table below presents the reconciliation of segment information to the corresponding amounts in the Consolidated Statements of Operations for the three months ended June 30, 2018 and 2017 (dollars in thousands): Three Months Ended June 30, 2018 2017 Segment operating loss $ (1,472 ) $ (3,015 ) Other non-segment items of income (expense) General and administrative (2,954 ) (1,995 ) Net income fee to related party (53 ) (77 ) Advisory fee to related party (2,929 ) (2,849 ) Other income 13,426 (3,541 ) Earnings from unconsolidated investees 277 153 Net income (loss) from continuing operations $ 6,295 $ (11,324 ) Presented below is our reportable segments’ operating income for the six months ended June 30, 2018 and 2017, including segment assets and expenditures (dollars in thousands): For the Six Months Ended June 30, 2018 Commercial Apartments Land Other Total Rental and other property revenues $ 14,959 $ 47,726 $ 1 $ 4 $ 62,690 Property operating expenses (7,986 ) (21,782 ) (134 ) (72 ) (29,974 ) Depreciation (4,616 ) (8,344 ) — 65 (12,895 ) Mortgage and loan interest (3,742 ) (10,798 ) (130 ) (16,961 ) (31,631 ) Interest income — — — 9,991 9,991 Gain on land sales — — 1,335 — 1,335 Segment operating (loss) income $ (1,385 ) $ 6,802 $ 1,072 $ (6,973 ) $ (484 ) Balance Sheet Data Capital expenditures $ 2,725 $ — $ — $ — $ 2,725 Real estate assets $ 135,288 $ 762,410 $ 111,899 $ 647 $ 1,010,244 Property Sales Sales price $ 2,313 $ 8,512 $ 7,239 $ — $ 18,064 Cost of sale (2,313 ) (8,512 ) (5,904 ) — (16,729 ) Gain on land sales $ — $ — $ 1,335 $ — $ 1,335 For the Six Months Ended June 30, 2017 Commercial Apartments Land Other Total Rental and other property revenues $ 17,711 $ 45,691 $ — $ 7 $ 63,409 Property operating expenses (9,839 ) (20,956 ) (447 ) (451 ) (31,693 ) Depreciation (4,699 ) (8,076 ) — 36 (12,739 ) Mortgage and loan interest (3,727 ) (11,787 ) (1,083 ) (17,546 ) (34,143 ) Interest income — — — 9,852 9,852 Loss on land sales — — (31 ) — (31 ) Segment operating (loss) income $ (554 ) $ 4,872 $ (1,561 ) $ (8,102 ) $ (5,345 ) Balance Sheet Data Capital expenditures $ 1,932 $ 585 $ — $ — $ 2,517 Real estate assets $ 148,718 $ 654,119 $ 127,810 $ — $ 930,647 Property Sales Sales price $ — $ — $ 1,596 $ — $ 1,596 Cost of sale — — (1,627 ) — (1,627 ) Loss on land sales $ — $ — $ (31 ) $ — $ (31 ) The table below presents the reconciliation of segment information to the corresponding amounts in the Consolidated Statements of Operations for the six months ended June 30, 2018 and 2017 (dollars in thousands): For the Six Months Ended June 30, 2018 2017 Segment operating income (loss) $ (484 ) $ (5,345 ) Other non-segment items of income (expense) General and administrative (5,295 ) (4,026 ) Net income fee to related party (106 ) (137 ) Advisory fee to related party (5,885 ) (5,508 ) Other income 17,083 (2,420 ) Earnings from unconsolidated investees 597 208 Net income (loss) from continuing operations $ 5,910 $ (17,228 ) The following table reconciles segment information to the corresponding amounts in the Consolidated Balance Sheets (dollars in thousands): As of June 30, 2018 2017 Segment assets $ 1,010,244 $ 930,647 Investments in unconsolidated investees 6,993 6,294 Notes and interest receivable 126,507 106,874 Other assets 205,360 188,921 Total assets $ 1,349,104 $ 1,232,736

COMMITMENTS, CONTINGENCIES, AND

COMMITMENTS, CONTINGENCIES, AND LIQUIDITY	6 Months Ended
	Jun. 30, 2018
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS, CONTINGENCIES, AND LIQUIDITY	NOTE 10. COMMITMENTS, CONTINGENCIES, AND LIQUIDITY Liquidity. Partnership Buyouts Litigation. Guarantees. ART and ART Midwest, Inc. While the Company and all entities in which the Company has a direct or indirect equity interest are not parties to or obligated in any way for the outcome, a formerly owned entity (American Realty Trust, Inc.) and its former subsidiary (ART Midwest, Inc.) have been engaged since 1999 in litigation with Mr. David Clapper and entities related to Mr. Clapper (collectively, the “Clapper Parties”). The matter originally involved a transaction in 1998 in which ART Midwest, Inc. was to acquire eight residential apartment complexes from the Clapper Parties. Through the years, a number of rulings, both for and against American Realty Trust, Inc. “ART” and ART Midwest, Inc., were issued. In October 2011, a ruling was issued under which the Clapper Parties received a judgment for approximately $74 million, including $26 million in actual damages and $48 million interest. The ruling was against ART and ART Midwest, Inc., but no other entity. During February 2014, the Court of Appeals affirmed a portion of the judgment in favor of the Clapper Parties, but also ruled that a double counting of a significant portion of the damages had occurred and remanded the case back to the trial court to recalculate the damage award, as well as pre- and post-judgment interest thereon. Subsequently, the trial court recalculated the damage award, reducing it to approximately $59 million, inclusive of actual damages and then current interest. ART was also a significant owner of a partnership interest in the partnership that was awarded the initial damages in this matter. The Clapper Parties subsequently filed a new lawsuit against ARI, its subsidiary EQK Holdings, Inc. “EQK”, and ART. The Clapper Parties seek damages from ARL for payment by ART to ARL of ART’s stock in EQK in exchange for a release of the Antecedent Debt owed by ART to ARI. In February 2018 the court determined that this legal matter should not have been filed in federal court and therefore granted motions to dismiss on jurisdictional grounds. In June 2018, the court overruled its own grant of motions to dismiss and reinstated the case. We continue to vigorously defend the case and management believes it has defenses to the claims. In 2005, ART filed suit against a major national law firm over the initial transaction. That action was initially abated while the principal case with the Clapper Parties was pending, but the abatement was recently lifted. The trial court subsequently dismissed the case on procedural grounds, but ART has filed a notice of appeal. The appeal was heard in February 2018 and we are awaiting a ruling by the appeals court. In January 2012, the Company sold all of the issued and outstanding stock of ART to an unrelated party for a promissory note in the amount of $10 million. At December 31, 2012, the Company fully reserved and valued such note at zero. Dynex Capital, Inc. On July 20, 2015, the 68 th An original trial in 2004, which also included Dynex Capital, Inc. as a defendant, resulted in a jury awarding damages in favor of Basic for “lost opportunity,” as well as damages in favor of ART and in favor of TCI and its subsidiaries for “increased costs” and “lost opportunity.” The original Trial Court judge ignored the jury’s findings, however, and entered a “Judgment Notwithstanding the Verdict” (“JNOV”) in favor of the Dynex entities (the judge held the Plaintiffs were not entitled to any damages from the Dynex entities). After numerous appeals by all parties, Dynex Capital, Inc. was ultimately dismissed from the case and the remaining claims against Dynex Commercial were remanded to the Trial Court for a new judgment consistent with the jury’s findings. The Court entered the new Final Judgment against Dynex Commercial, Inc. on July 20, 2015. The Final Judgment entered against Dynex Commercial, Inc. on July 20, 2015 awarded Basic was $0.256 million in damages, plus pre-judgment interest of $0.192 million for a total amount of $0.448 million. The Judgment awarded ART was $14.2 million in damages, plus pre-judgment interest of $10.6 million for a total amount of $24.8 million. The Judgment awarded TCI was $11.1 million, plus pre-judgment interest of $8.4 million for a total amount of $19.5 million. The Judgment also awarded Basic, ART, and TCI post-judgment interest at the rate of 5% per annum from April 25, 2014 until the date their respective damages were paid. Lastly, the Judgement awarded Basic, ART, and TCI was $1.6 million collectively in attorneys’ fees from Dynex Commercial, Inc. TCI is working with counsel to identify assets and collect on the Final Judgment against Dynex Commercial, Inc., as well as explore possible additional claims, if any, against Dynex Capital, Inc.

EARNINGS PER SHARE

EARNINGS PER SHARE	6 Months Ended
	Jun. 30, 2018
Earnings Per Share [Abstract]
EARNINGS PER SHARE	NOTE 11. EARNINGS PER SHARE Earnings Per Share (“EPS”) have been computed pursuant to the provisions of ASC Topic 260, “Earnings Per Share”. The computation of basic EPS is calculated by dividing net income available to common shareholders from continuing operations, adjusted for preferred dividends, by the weighted-average number of common shares outstanding during the period. Shares issued during the period shall be weighted for the portion of the period that they were outstanding. As of June 30, 2018, we have 1,800,614 shares of Series A 10.0% cumulative convertible preferred stock, which are outstanding. These shares may be converted into common stock at 90% of the average daily closing price of the common stock for the prior 20 trading days. These are considered in the computation of diluted earnings per share if the effect of applying the if-converted method is dilutive. Of the outstanding 1,800,614 shares of Series A 10.0% cumulative convertible preferred stock, 900,000 shares are held by ARL. Dividends are not paid on the shares owned by ARL subsidiaries. Prior to January 12, 2018, RAI owned 1,100,000 shares of the outstanding Series A 10.0% convertible preferred stock and had accrued dividends unpaid of $10.5 million. On January 12, 2018, RAI converted 200,000 shares, including $1.8 million in accumulated dividends unpaid for these shares, into the requisite number of shares of common stock. This conversion resulted in the issuance of 482,716 new shares of ARL common stock. As of June 30, 2018 RAI owns 900,000 shares of the outstanding Series A 10.0% convertible preferred stock and has accrued dividends unpaid of $9.2 million.

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	6 Months Ended
	Jun. 30, 2018
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	NOTE 12. SUBSEQUENT EVENTS On July 19, 2018, Southern closed a private placement offering of its Series B bonds in the amount of NIS 72.3 million (or approximately $19.8 million). The bonds are reported in NIS, are registered on the TASE, bear an annual interest rate of 6.8% and have an effective interest rate of 9.60%. Interest will be paid on January 31 and July 31 of each of the years 2019 to 2023 (inclusive). The principal will be repaid in ten equal installments on January 31 and July 31 of each of the years from 2021 to 2025 (inclusive). The Company incurred bond issuance costs of approximately $1.9 million.

ORGANIZATION AND BASIS OF PRE22

ORGANIZATION AND BASIS OF PRESENTATION (Policies)	6 Months Ended
	Jun. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Properties	Properties We own or had interests in a total property portfolio of fifty three income-producing properties as of June 30, 2018. The properties consisted of: ● Seven commercial properties consisting of five office buildings and two retail centers comprising in aggregate approximately 1.7 million rentable square feet; ● Forty-six apartment communities totaling 8,195 units, excluding apartments being developed; and ● 3,492 acres of developed and undeveloped land. We join with various third-party development companies to construct residential apartment communities. We are in the predevelopment process on several residential apartment communities that have not yet begun construction. At June 30, 2018, we had ten apartment projects in development. The third-party developer typically holds a general partner as well as a majority limited partner interest in a limited partnership formed for the purpose of building a single property, while we generally take a minority limited partner interest in the limited partnership. We may contribute land to the partnership as part of our equity contribution or we may contribute the necessary funds to the partnership to acquire the land. We are required to fund all necessary equity contributions while the third-party developer is responsible for obtaining construction financing, hiring a general contractor and for the overall management, successful completion and delivery of the project. We generally bear all the economic risks and rewards of ownership in these partnerships and therefore include these partnerships in our Consolidated Financial Statements. The third-party developer is paid a developer fee typically equal to a percentage of the construction costs. When the project reaches stabilized occupancy, we acquire the third-party developer’s partnership interests in exchange for any remaining unpaid developer fees.
Basis of Presentation	Basis of Presentation The accompanying unaudited Consolidated Financial Statements have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted in accordance with such rules and regulations, although management believes the disclosures are adequate to prevent the information presented from being misleading. In the opinion of management, all adjustments (consisting of normal recurring matters) considered necessary for a fair presentation have been included. The results of operations for the three and six months ended June 30, 2018, are not necessarily indicative of the results that may be expected for other interim periods or for the full fiscal year. The year-end Consolidated Balance Sheet at December 31, 2017 was derived from the audited Consolidated Financial Statements at that date, but does not include all of the information and disclosures required by U.S. GAAP for complete financial statements. For further information, refer to the Consolidated Financial Statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017. Certain 2017 Consolidated Financial Statement amounts have been reclassified to conform to the 2018 presentation.
Principles of Consolidation	Principles of Consolidation The accompanying Consolidated Financial Statements include the accounts of the Company, its subsidiaries, generally all of which are wholly-owned, and all entities in which we have a controlling interest. Arrangements that are not controlled through voting or similar rights are accounted for as a Variable Interest Entity (“VIE”), in accordance with the provisions and guidance of ASC Topic 810, “Consolidation”, whereby we have determined that we are a primary beneficiary of the VIE and meet certain criteria of a sole general partner or managing member as identified in accordance with Emerging Issues Task Force (“EITF”) Issue 04-5, Investor’s Accounting for an Investment in a Limited Partnership when the Investor is the Sole General Partner and the Limited Partners have Certain Rights (“EITF 04-5”). VIEs are generally entities that lack sufficient equity to finance their activities without additional financial support from other parties or whose equity holders as a group lack adequate decision making ability, the obligation to absorb expected losses or residual returns of the entity, or have voting rights that are not proportional to their economic interests. The primary beneficiary is generally the entity that provides financial support and bears a majority of the financial risks, authorizes certain capital transactions, or makes operating decisions that materially affect the entity’s financial results. All significant intercompany balances and transactions have been eliminated in consolidation. In determining whether we are the primary beneficiary of a VIE, we consider qualitative and quantitative factors, including, but not limited to: the amount and characteristics of our investment; the obligation or likelihood for us or other investors to provide financial support; our and the other investors’ ability to control or significantly influence key decisions for the VIE; and the similarity with and significance to the business activities of us and the other investors. Significant judgments related to these determinations include estimates about the current future fair values and performance of real estate held by these VIEs and general market conditions. For entities in which we have less than a controlling financial interest or entities where we are not deemed to be the primary beneficiary, the entities are accounted for using the equity method of accounting. Accordingly, our share of the net earnings or losses of these entities is included in consolidated net income. Our investment in Gruppa Florentina, LLC is accounted for under the equity method.
Real Estate, Depreciation and Impairment	Real Estate, Depreciation and Impairment Real estate assets are stated at the lower of depreciated cost or fair value, if deemed impaired. Major replacements and betterments are capitalized and depreciated over their estimated useful lives. Depreciation is computed on a straight-line basis over the useful lives of the properties (buildings and improvements: 10-40 years; furniture, fixtures and equipment: 5-10 years). The Company continually evaluates the recoverability of the carrying value of its real estate assets using the methodology prescribed in ASC Topic 360 (“ASC 360”), “Property, Plant and Equipment”. Factors considered by management in evaluating impairment of its existing real estate assets held for investment include significant declines in property operating profits, annually recurring property operating losses and other significant adverse changes in general market conditions that are considered permanent in nature. Under ASC 360, a real estate asset held for investment is not considered impaired if the undiscounted, estimated future cash flows of an asset (both the annual estimated cash flow from future operations and the estimated cash flow from the theoretical sale of the asset) over its estimated holding period are in excess of the asset’s net book value at the balance sheet date. If any real estate asset held for investment is considered impaired, a loss is provided to reduce the carrying value of the asset to its estimated fair value.
Real Estate Held for Sale	Real Estate Held For Sale We periodically classify real estate assets as “held for sale.” An asset is classified as held for sale after the approval of our Board of Directors, after an active program to sell the asset has commenced and if the sale is probable. One of the deciding factors in determining whether a sale is probable is whether the firm purchase commitment is obtained and whether the sale is probable within the year. Upon the classification of a real estate asset as held for sale, the carrying value of the asset is reduced to the lower of its net book value or its estimated fair value, less costs to sell the asset. Subsequent to the classification of assets as held for sale, no further depreciation expense is recorded. Real estate assets held for sale are stated separately on the accompanying Consolidated Balance Sheets. Upon a decision that the sale is no longer probable, the asset is classified as an operating asset and depreciation expense is reinstated. Prior to January 1, 2015, the operating results of real estate assets held for sale and sold were reported as discontinued operations in the accompanying Consolidated Statements of Operations. Income from discontinued operations includes the revenues and expenses, including depreciation and interest expense, associated with the assets. Effective January 1, 2015, Accounting Standards Update 2014-08, “Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity” (“ASU 2014-08”) substantially changed the criteria for determining whether a disposition qualifies for discontinued operations presentation. Since the Company adopted ASU 2014-08, effective January 1, 2015, we have had no dispositions that met the discontinued operations criteria.
Cost Capitalization	Cost Capitalization Costs related to planning, developing, leasing and constructing a property are capitalized and classified as Real Estate in the Consolidated Balance Sheets. We capitalize interest to qualifying assets under development based on average accumulated expenditures outstanding during the period. In capitalizing interest to qualifying assets, we first use the interest incurred on specific project debt, if any, and next use the weighted average interest rate of non-project specific debt. We capitalize interest, real estate taxes and certain operating expenses until building construction is substantially complete and the building is ready for its intended use, but no later than one year from the cessation of major construction activity. We capitalize leasing costs which include commissions paid to outside brokers, legal costs incurred to negotiate and document a lease agreement and any internal costs that may be applicable. We allocate these costs to individual tenant leases and amortize them over the related lease term.
Fair Value Measurement	Fair Value Measurement We apply the guidance in ASC Topic 820, “Fair Value Measurements and Disclosures”, to the valuation of real estate assets. These provisions define fair value as the price that would be received to sell an asset or paid to transfer a liability in a transaction between market participants at the measurement date, establish a hierarchy that prioritizes the information used in developing fair value estimates and require disclosure of fair value measurements by level within the fair value hierarchy. The hierarchy gives the highest priority to quoted prices in active markets (Level 1 measurements) and the lowest priority to unobservable data (Level 3 measurements), such as the reporting entity’s own data. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date and includes three levels defined as follows: Level 1 – Unadjusted quoted prices for identical and unrestricted assets or liabilities in active markets. Level 2 – Quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. Level 3 – Unobservable inputs that are significant to the fair value measurement. A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.
Deferred Costs	Deferred Costs Costs relating to the financing of properties are deferred and amortized over the life of the related financing agreement. Amortization is reflected as interest expense in the Consolidated Statements of Operations, with remaining terms ranging from 6 months to 40 years. Unamortized financing costs are written off when the financing agreement is extinguished before the maturity date.
Related Parties	Related Parties We apply ASC Topic 805, “Business Combinations”, to evaluate business relationships. Related parties are persons or entities who have one or more of the following characteristics, which include entities for which investments in their equity securities would be required, trust for the benefit of persons including principal owners of the entities and members of their immediate families, management personnel of the entity and members of their immediate families and other parties with which the entity may deal if one party controls or can significantly influence the decision making of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests, or affiliates of the entity.
Newly Issued Accounting Standards	Newly Issued Accounting Standards In May 2014, Accounting Standards Update (“ASU”) No. 2014-09 (“ASU 2014-09”), “Revenue from Contracts with Customers,” was issued. This new guidance established a new single comprehensive revenue recognition model and provides for enhanced disclosures. Under the new policy, the nature, timing and amount of revenue recognized for certain transactions could differ from those recognized under existing accounting guidance. This new standard does not affect revenue recognized under lease contracts. ASU 2014-09 is effective for reporting periods beginning after December 15, 2017. The Company does not believe the adoption of this guidance had a material impact on its financial statements. In February 2016, FASB issued ASU 2016-02 (“ASU 2016-02”), Leases. This guidance establishes a new model for accounting for leases and provides for enhanced disclosures. ASU 2016-02 is effective for reporting periods beginning after December 15, 2018. The Company is currently evaluating the impact of the adoption of ASU 2016-02 on its financial position and results of operations, if any. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments, which addresses how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The ASU is effective for fiscal years beginning after December 15, 2017, including interim periods within those years; however, early adoption is permitted. Entities must apply the guidance retrospectively to all periods presented but may apply it prospectively if retrospective application would be impracticable. The Company adopted this standard effective on January 1, 2018. ASU 2016-15 will impact our presentation of operating, investing and financing activities related to certain cash receipts and payments on our consolidated statements of cash flows. In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash, which clarifies guidance on the classification and presentation of changes in restricted cash. The ASU is effective for reporting periods beginning after December 15, 2017, with early adoption permitted, and will be applied retrospectively to all periods presented. Upon adoption, restricted cash balances will be included along with cash and cash equivalents as of the end of the period and beginning period, respectively, in the Company’s consolidated statement of cash flows for all periods presented. Upon adoption, separate line items showing changes in restricted cash balances will be eliminated from the Company’s consolidated statement of cash flows. The Company adopted this guidance effective on January 1, 2018. ASU 2016-18 will impact our presentation of operating, investing and financing activities related to restricted cash on our consolidated statements of cash flows. In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business, which clarifies the definition of a business when evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The ASU is effective for reporting periods beginning after December 15, 2017, with early adoption permitted. The Company expects that acquisitions of real estate or in-substance real estate will not meet the revised definition of a business and thus will be treated as asset acquisitions. Acquisition costs for those acquisitions that are not businesses will be capitalized rather than expensed. The Company adopted this guidance effective January 1, 2018. The Company does not believe the adoption of this guidance will have a material impact on its consolidated financial statements. In February 2017, the FASB issued ASU 2017-05, Other Income – Gains and Losses from the Derecognition of Nonfinancial Assets (Topic 610-20), which requires that all entities account for the derecognition of a business in accordance with ASC 810, including instances in which the business is considered in-substance real estate. The ASU requires the Company to measure at fair value any retained interest in a partial sale of real estate. The ASU is effective for annual periods, and interim periods therein, beginning after December 15, 2017. The Company adopted ASU 2017-05 effective January 1, 2018. The Company does not believe the adoption of this guidance will have a material impact on its consolidated financial statements.

REAL ESTATE ACTIVITY (Tables)

REAL ESTATE ACTIVITY (Tables)	6 Months Ended
	Jun. 30, 2018
Real Estate [Abstract]
Schedule of real estate owned	Below is a summary of the real estate owned as of June 30, 2018 (dollars in thousands): Apartments $ 730,045 Apartments under construction 152,943 Commercial properties 202,367 Land held for development 62,257 Real estate subject to sales contract 46,262 Total real estate $ 1,193,874 Less accumulated depreciation (183,630 ) Total real estate, net of depreciation $ 1,010,244

SUPPLEMENTAL CASH FLOW INFORM24

SUPPLEMENTAL CASH FLOW INFORMATION (Tables)	6 Months Ended
	Jun. 30, 2018
Supplemental Cash Flow Elements [Abstract]
Schedule of reconciliation of cash and cash equivalents and restricted cash	The following is a reconciliation of the Company’s cash and cash equivalents, and restricted cash to the total presented in the consolidated statement of cash flows: June 30, 2018 2017 Cash and cash equivalents $ 28,116 $ 58,260 Restricted cash (cash held in escrow) 49,760 33,448 Restricted cash (certificate of deposits) 9,162 - Restricted cash (held with Trustee) 5,730 4,137 $ 92,768 $ 95,845

NOTES AND INTEREST RECEIVABLE (

NOTES AND INTEREST RECEIVABLE (Tables)	6 Months Ended
	Jun. 30, 2018
Receivables [Abstract]
Schedule of notes receivable	Below is a summary of our notes receivable as of June 30, 2018 (dollars in thousands): Borrower Maturity Date Interest Rate Amount Security Performing loans: H198, LLC (Las Vegas Land) 01/20 12.00% $ 5,907 Secured Leman Development, Ltd (2) N/A 0.00% 1,500 Unsecured Oulan-Chikh Family Trust 03/21 8.00% 174 Secured H198, LLC (McKinney Ranch Land) 09/18 6.00% 4,554 Secured 2818 Ventures LLC (Forest Pines) 11/18 5.00% 2,223 Secured ABC Land & Development (Mandahl Bay) 05/38 6.00% 1,735 Secured Unified Housing Foundation, Inc. (Echo Station) (1) 12/32 12.00% 1,481 Secured Unified Housing Foundation, Inc. (Inwood on the Park) (1) 12/32 12.00% 3,639 Secured Unified Housing Foundation, Inc. (Kensington Park) (1) 12/32 12.00% 3,933 Secured Unified Housing Foundation, Inc. (Lakeshore Villas) (1) 12/32 12.00% 2,000 Secured Unified Housing Foundation, Inc. (Lakeshore Villas) (1) 12/32 12.00% 9,101 Secured Unified Housing Foundation, Inc. (Limestone Ranch) (1) 12/32 12.00% 1,953 Secured Unified Housing Foundation, Inc. (Limestone Ranch) (1) 12/32 12.00% 6,000 Secured Unified Housing Foundation, Inc. (Reserve at White Rock Phase I) (1) 12/32 12.00% 2,485 Secured Unified Housing Foundation, Inc. (Reserve at White Rock Phase II) (1) 12/32 12.00% 2,555 Secured Unified Housing Foundation, Inc. (Timbers of Terrell) (1) 12/32 12.00% 1,323 Secured Unified Housing Foundation, Inc. (Tivoli) (1) 12/32 12.00% 7,965 Secured Unified Housing Foundation, Inc. (Trails at White Rock) (1) 12/32 12.00% 3,815 Secured Unified Housing Foundation, Inc. (1) 12/18 12.00% 3,994 Unsecured Unified Housing Foundation, Inc. (1) 12/18 12.00% 6,407 Unsecured Unified Housing Foundation, Inc. (1) 06/20 12.00% 5,760 Unsecured Unified Housing Foundation, Inc. (1) 03/21 12.00% 5,314 Unsecured One Realco Corporation (1,2) 01/20 3.00% 7,000 Unsecured Realty Advisors Management, Inc. (1) 12/19 2.28% 20,387 Unsecured Other related party notes Various Various 1,349 Various secured interests Other related party notes Various Various 510 Various unsecured interests Other non-related party notes Various Various 3,466 Various secured interests Other non-related party notes Various Various 14,639 Various unsecured interests Accrued interest 11,108 Total Performing $ 142,277 Allowance for estimated losses (15,770 ) Total $ 126,507 (1) (2)

INVESTMENT IN UNCONSOLIDATED 26

INVESTMENT IN UNCONSOLIDATED INVESTEES (Tables)	6 Months Ended
	Jun. 30, 2018
Equity Method Investments and Joint Ventures [Abstract]
Schedule of investments in unconsolidated investees	Investments in unconsolidated investees consist of the following: Percentage ownership as of June 30, 2018 June 30, 2017 Gruppa Florentina, LLC 20.00 % 20.00 %
Schedule of financial position and results of operations from our investees	The following is a summary of the financial position and results of operations from our investees (dollars in thousands): As of June 30, 2018 2017 Real estate, net of accumulated depreciation $ 13,485 $ 13,578 Notes receivable 10,918 9,969 Other assets 32,290 30,188 Notes payable (10,745 ) (9,514 ) Other liabilities (7,775 ) (7,821 ) Shareholders’ equity (38,173 ) (36,400 ) For the Six Months Ended June 30, 2018 2017 Revenue $ 27,195 $ 27,458 Depreciation (728 ) (575 ) Operating expenses (25,630 ) (25,533 ) Interest expense (340 ) (353 ) Income from continuing operations 497 497 Net income $ 497 $ 997 Company’s proportionate share of earnings $ 99 $ 199

NOTES PAYABLE (Tables)

NOTES PAYABLE (Tables)	6 Months Ended
	Jun. 30, 2018
Debt Disclosure [Abstract]
Schedule of Notes and Interest Payable	Below is a summary of our notes and interest payable as of June 30, 2018 (dollars in thousands): Notes Payable Accrued Interest Total Debt Apartments $ 568,449 $ 1,585 $ 570,034 Apartments under Construction 118,665 31 118,696 Commercial 125,807 616 126,423 Land 21,734 197 21,931 Real estate subject to sales contract 376 — 376 Mezzanine financing 93,422 509 93,931 Other 8,882 (593 ) 8,289 Total $ 937,335 $ 2,345 $ 939,680 Unamortized deferred borrowing costs (17,843 ) — (17,843 ) $ 919,492 $ 2,345 $ 921,837

BONDS PAYABLE (Tables)

BONDS PAYABLE (Tables)	6 Months Ended
	Jun. 30, 2018
Bonds Payable
Schedule of bonds and interest payable	The outstanding balance of these Bonds at June 30, 2018 is as follows: June 30, December 31, 2017 Bonds (Series A) $ 109,552 $ 115,336 Bonds (Series B) 37,726 — Less: deferred issuance expense, net (7,210 ) (5,916 ) Accrued Interest 3,829 3,629 $ 143,897 $ 113,049
Schedule of principal payments on the bonds payable	The aggregate maturity of the bonds are as follows: Year 2018 $ — 2019 23,067 2020 23,067 2021 23,067 2022 30,903 Thereafter 47,174 $ 147,278

RELATED PARTY TRANSACTIONS (Tab

RELATED PARTY TRANSACTIONS (Tables)	6 Months Ended
	Jun. 30, 2018
Related Party Transactions [Abstract]
Schedule of net receivable from related parties	The following table reflects the reconciliation of the beginning and ending balances of accounts receivable from and (accounts payable) to related parties as of June 30, 2018 (dollars in thousands): Pillar Related party receivable, December 31, 2017 $ 38,311 Cash transfers 26,033 Advisory fees (5,884 ) Net income fee (106 ) Cost reimbursements (2,346 ) Interest income 1,347 Notes receivable purchased (5,315 ) Fees and commissions (162 ) Expenses (paid) received by Advisor 4,845 Financing (mortgage payments) (169 ) Sales/purchases transactions (567 ) Related party receivable, June 30, 2018 $ 55,987

OPERATING SEGMENTS (Tables)

OPERATING SEGMENTS (Tables)	6 Months Ended
	Jun. 30, 2018
Segment Reporting [Abstract]
Schedule of segment operating income including segment assets and expenditures	Presented below is our reportable segments’ operating income for the three months ended June 30, 2018 and 2017, including segment assets and expenditures (dollars in thousands): For the Three Months Ended June 30, 2018 Commercial Apartments Land Other Total Rental and other property revenues $ 7,404 $ 24,201 $ — $ 2 $ 31,607 Property operating expenses (4,238 ) (11,199 ) (135 ) 22 (15,550 ) Depreciation (2,323 ) (4,195 ) — 14 (6,504 ) Mortgage and loan interest (1,893 ) (5,342 ) 65 (8,737 ) (15,907 ) Interest income — — — 4,882 4,882 Segment operating (loss) income $ (1,050 ) $ 3,465 $ (70 ) $ (3,817 ) $ (1,472 ) Balance Sheet Data Capital expenditures $ 2,092 $ — $ — $ — $ 2,092 Property Sales Sales price $ 2,313 $ — $ — $ — $ 2,313 Cost of sale (2,313 ) — — — (2,313 ) Gain (loss) on sale $ — $ — $ — $ — $ — For the Three Months Ended June 30, 2017 Commercial Apartments Land Other Total Rental and other property revenues $ 8,553 $ 23,030 $ — $ 4 $ 31,587 Property operating expenses (4,900 ) (10,211 ) (168 ) (150 ) (15,429 ) Depreciation (2,397 ) (4,030 ) — 18 (6,409 ) Mortgage and loan interest (2,121 ) (5,028 ) (389 ) (9,809 ) (17,347 ) Interest income — — — 5,059 5,059 Loss on land sales — — (476 ) — (476 ) Segment operating (loss) income $ (865 ) $ 3,761 $ (1,033 ) $ (4,878 ) $ (3,015 ) Balance Sheet Data Capital expenditures $ 557 $ — $ 186 $ — $ 743 Property Sales Sales price $ — $ — $ 507 $ — $ 507 Cost of sale — — (983 ) — (983 ) Loss on sale $ — $ — $ (476 ) $ — $ (476 ) Presented below is our reportable segments’ operating income for the six months ended June 30, 2018 and 2017, including segment assets and expenditures (dollars in thousands): For the Six Months Ended June 30, 2018 Commercial Apartments Land Other Total Rental and other property revenues $ 14,959 $ 47,726 $ 1 $ 4 $ 62,690 Property operating expenses (7,986 ) (21,782 ) (134 ) (72 ) (29,974 ) Depreciation (4,616 ) (8,344 ) — 65 (12,895 ) Mortgage and loan interest (3,742 ) (10,798 ) (130 ) (16,961 ) (31,631 ) Interest income — — — 9,991 9,991 Gain on land sales — — 1,335 — 1,335 Segment operating (loss) income $ (1,385 ) $ 6,802 $ 1,072 $ (6,973 ) $ (484 ) Balance Sheet Data Capital expenditures $ 2,725 $ — $ — $ — $ 2,725 Real estate assets $ 135,288 $ 762,410 $ 111,899 $ 647 $ 1,010,244 Property Sales Sales price $ 2,313 $ 8,512 $ 7,239 $ — $ 18,064 Cost of sale (2,313 ) (8,512 ) (5,904 ) — (16,729 ) Gain on land sales $ — $ — $ 1,335 $ — $ 1,335 For the Six Months Ended June 30, 2017 Commercial Apartments Land Other Total Rental and other property revenues $ 17,711 $ 45,691 $ — $ 7 $ 63,409 Property operating expenses (9,839 ) (20,956 ) (447 ) (451 ) (31,693 ) Depreciation (4,699 ) (8,076 ) — 36 (12,739 ) Mortgage and loan interest (3,727 ) (11,787 ) (1,083 ) (17,546 ) (34,143 ) Interest income — — — 9,852 9,852 Loss on land sales — — (31 ) — (31 ) Segment operating (loss) income $ (554 ) $ 4,872 $ (1,561 ) $ (8,102 ) $ (5,345 ) Balance Sheet Data Capital expenditures $ 1,932 $ 585 $ — $ — $ 2,517 Real estate assets $ 148,718 $ 654,119 $ 127,810 $ — $ 930,647 Property Sales Sales price $ — $ — $ 1,596 $ — $ 1,596 Cost of sale — — (1,627 ) — (1,627 ) Loss on land sales $ — $ — $ (31 ) $ — $ (31 )
Schedule of reconciliation of segment information to Consolidated Statements of Operations	The table below presents the reconciliation of segment information to the corresponding amounts in the Consolidated Statements of Operations for the three months ended June 30, 2018 and 2017 (dollars in thousands): Three Months Ended June 30, 2018 2017 Segment operating loss $ (1,472 ) $ (3,015 ) Other non-segment items of income (expense) General and administrative (2,954 ) (1,995 ) Net income fee to related party (53 ) (77 ) Advisory fee to related party (2,929 ) (2,849 ) Other income 13,426 (3,541 ) Earnings from unconsolidated investees 277 153 Net income (loss) from continuing operations $ 6,295 $ (11,324 ) The table below presents the reconciliation of segment information to the corresponding amounts in the Consolidated Statements of Operations for the six months ended June 30, 2018 and 2017 (dollars in thousands): For the Six Months Ended June 30, 2018 2017 Segment operating income (loss) $ (484 ) $ (5,345 ) Other non-segment items of income (expense) General and administrative (5,295 ) (4,026 ) Net income fee to related party (106 ) (137 ) Advisory fee to related party (5,885 ) (5,508 ) Other income 17,083 (2,420 ) Earnings from unconsolidated investees 597 208 Net income (loss) from continuing operations $ 5,910 $ (17,228 )
Schedule of reconciliation of segment information to Consolidated Balance Sheets	The following table reconciles segment information to the corresponding amounts in the Consolidated Balance Sheets (dollars in thousands): As of June 30, 2018 2017 Segment assets $ 1,010,244 $ 930,647 Investments in unconsolidated investees 6,993 6,294 Notes and interest receivable 126,507 106,874 Other assets 205,360 188,921 Total assets $ 1,349,104 $ 1,232,736

ORGANIZATION AND BASIS OF PRE31

ORGANIZATION AND BASIS OF PRESENTATION (Details Narrative)	6 Months Ended
	Jun. 30, 2018ft²Number
Number of income-producing properties	53
Rentable square feet | ft²	1,700,000
Number of apartment units	8,195
Acres of land | ft²	3,492
Related Party [Member]
Percentage of ownership	80.00%
Minimum [Member]
Percentage of ownership	20.00%
Remaining amortization period for deferred financing costs	6 months
Maximum [Member]
Percentage of ownership	50.00%
Remaining amortization period for deferred financing costs	40 years
Buildings And Improvements [Member] | Minimum [Member]
Useful life of fixed assets	10 years
Buildings And Improvements [Member] | Maximum [Member]
Useful life of fixed assets	40 years
Furniture, Fixtures And Equipment [Member] | Minimum [Member]
Useful life of fixed assets	5 years
Furniture, Fixtures And Equipment [Member] | Maximum [Member]
Useful life of fixed assets	10 years
Apartment Buildings [Member]
Number of income-producing properties	45
Projects in development	10
Transcontinential Realty Investors [Member]
Ownership interest	78.00%
Transcontinential Realty Investors [Member] | Income Opportunity Realty Investors, Inc. [Member]
Ownership interest	81.25%

REAL ESTATE ACTIVITY (Details)

REAL ESTATE ACTIVITY (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017	Jun. 30, 2017
Real Estate [Abstract]
Apartments	$ 730,045
Apartments under construction	152,943
Commercial properties	202,367
Land held for development	62,257
Real estate subject to sales contract	46,262
Total real estate, at cost, less impairment	1,193,874
Less accumulated depreciation	(183,630)
Total real estate	$ 1,010,244	$ 988,117	$ 930,647

REAL ESTATE ACTIVITY (Details N

REAL ESTATE ACTIVITY (Details Narrative) $ in Thousands	6 Months Ended
	Jun. 30, 2018USD ($)aNumber
Payment for construction or predevelopment of various apartment complexes	$ 47,500
Capitalized interest costs	$ 900
Related Party [Member]
Area of land sold | a	91
Aggregate price of properties	$ 8,500
Notes receivable	6,400
Cash	$ 2,100
TEXAS | Land [Member]
Area of land sold | a	112.2
Gain on sale of real estate	$ 1,300
Aggregate price of properties	$ 7,200
TEXAS | Golf Course[Member]
Area of land sold | a	96.09
Aggregate price of properties	$ 2,300
Notes receivable	1,700
Cash	$ 600
Baton Rouge, LA [Member]
Number of residential apartment purchased | Number	80
Purchase price of units	$ 12,000
Baton Rouge, LA [Member] | Financing Note [Member]
Purchase price of units	1,900
Baton Rouge, LA [Member] | Notes Payable [Member]
Purchase price of units	8,600
Baton Rouge, LA [Member] | Exercising an Option to Purchase [Member]
Purchase price of units	$ 1,500

SUPPLEMENTAL CASH FLOW INFORM34

SUPPLEMENTAL CASH FLOW INFORMATION (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017	Jun. 30, 2017	Dec. 31, 2016
Supplemental Cash Flow Elements [Abstract]
Cash and cash equivalents	$ 28,116	$ 42,920	$ 58,260
Restricted cash (cash held in escrow)	49,760		33,448
Restricted cash (certificate of deposits)	9,162		0
Restricted cash (held with Trustee)	5,730		4,137
Total cash and cash equivalents, and restricted cash	$ 92,768	$ 88,538	$ 95,845	$ 55,921

SUPPLEMENTAL CASH FLOW INFORM35

SUPPLEMENTAL CASH FLOW INFORMATION (Details Narrative) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Supplemental Cash Flow Elements [Abstract]
Interest expense paid	$ 31,000	$ 28,100

NOTES AND INTEREST RECEIVABLE36

NOTES AND INTEREST RECEIVABLE (Details) - USD ($) $ in Thousands		6 Months Ended
		Jun. 30, 2018	Dec. 31, 2017	Jun. 30, 2017
Allowance for estimated losses		$ (15,770)
Total notes receivable		126,507	$ 112,095	$ 106,874
Performing Loans [Member]
Performing loans, total		142,277
Accrued interest		$ 11,108
Performing Loans [Member] | H198, LLC (Las Vegas Land) [Member]
Maturity Date		Jan. 31, 2020
Description of property		H198, LLC (Las Vegas Land)
Interest Rate		12.00%
Performing loans, total		$ 5,907
Description of Security		Secured
Performing Loans [Member] | Leman Development, Ltd [Member]
Description of property	[1]	Leman Development, Ltd
Interest Rate	[1]	0.00%
Performing loans, total	[1]	$ 1,500
Description of Security	[1]	Unsecured
Performing Loans [Member] | Oulan-Chikh Family Trust [Member]
Maturity Date		Mar. 31, 2021
Description of property		Oulan-Chikh Family Trust
Interest Rate		8.00%
Performing loans, total		$ 174
Description of Security		Secured
Performing Loans [Member] | H198, LLC (McKinney Ranch Land) [Member]
Maturity Date		Sep. 30, 2018
Description of property		H198, LLC (McKinney Ranch Land)
Interest Rate		6.00%
Performing loans, total		$ 4,554
Description of Security		Secured
Performing Loans [Member] | 2818 Ventures LLC (Forest Pines) [Member]
Maturity Date		Nov. 30, 2018
Description of property		2818 Ventures LLC (Forest Pines)
Interest Rate		5.00%
Performing loans, total		$ 2,223
Description of Security		Secured
Performing Loans [Member] | ABC Land & Development (Mandahl Bay) [Member]
Maturity Date		May 31, 2038
Description of property		ABC Land & Development (Mandahl Bay)
Interest Rate		6.00%
Performing loans, total		$ 1,735
Description of Security		Secured
Performing Loans [Member] | Unified Housing Foundation, Inc. (Echo Station) [Member]
Maturity Date	[2]	Dec. 31, 2032
Description of property	[2]	Unified Housing Foundation, Inc. (Echo Station)
Interest Rate	[2]	12.00%
Performing loans, total	[2]	$ 1,481
Description of Security	[2]	Secured
Performing Loans [Member] | Unified Housing Foundation, Inc. (Inwood on the Park) [Member]
Maturity Date	[2]	Dec. 31, 2032
Description of property	[2]	Unified Housing Foundation, Inc. (Inwood on the Park)
Interest Rate	[2]	12.00%
Performing loans, total	[2]	$ 3,639
Description of Security	[2]	Secured
Performing Loans [Member] | Unified Housing Foundation, Inc. (Kensington Park) [Member]
Maturity Date	[2]	Dec. 31, 2032
Description of property	[2]	Unified Housing Foundation, Inc. (Kensington Park)
Interest Rate	[2]	12.00%
Performing loans, total	[2]	$ 3,933
Description of Security	[2]	Secured
Performing Loans [Member] | Unified Housing Foundation, Inc. (Lakeshore Villas) [Member]
Maturity Date	[2]	Dec. 31, 2032
Description of property	[2]	Unified Housing Foundation, Inc. (Lakeshore Villas)
Interest Rate	[2]	12.00%
Performing loans, total	[2]	$ 2,000
Description of Security	[2]	Secured
Performing Loans [Member] | Unified Housing Foundation, Inc. (Lakeshore Villas) [Member]
Maturity Date	[2]	Dec. 31, 2032
Description of property	[2]	Unified Housing Foundation, Inc. (Lakeshore Villas)
Interest Rate	[2]	12.00%
Performing loans, total	[2]	$ 9,101
Description of Security	[2]	Secured
Performing Loans [Member] | Unified Housing Foundation, Inc. (Limestone Ranch) [Member]
Maturity Date	[2]	Dec. 31, 2032
Description of property	[2]	Unified Housing Foundation, Inc. (Limestone Ranch)
Interest Rate	[2]	12.00%
Performing loans, total	[2]	$ 1,953
Description of Security	[2]	Secured
Performing Loans [Member] | Unified Housing Foundation, Inc. (Limestone Ranch) [Member]
Maturity Date	[2]	Dec. 31, 2032
Description of property	[2]	Unified Housing Foundation, Inc. (Limestone Ranch)
Interest Rate	[2]	12.00%
Performing loans, total	[2]	$ 6,000
Description of Security	[2]	Secured
Performing Loans [Member] | Unified Housing Foundation, Inc. (Reserve at White Rock Phase I) [Member]
Maturity Date	[2]	Dec. 31, 2032
Description of property	[2]	Unified Housing Foundation, Inc. (Reserve at White Rock Phase I)
Interest Rate	[2]	12.00%
Performing loans, total	[2]	$ 2,485
Description of Security	[2]	Secured
Performing Loans [Member] | Unified Housing Foundation, Inc. (Reserve at White Rock Phase II) [Member]
Maturity Date	[2]	Dec. 31, 2032
Description of property	[2]	Unified Housing Foundation, Inc. (Reserve at White Rock Phase II)
Interest Rate	[2]	12.00%
Performing loans, total	[2]	$ 2,555
Description of Security	[2]	Secured
Performing Loans [Member] | Unified Housing Foundation, Inc. (Timbers of Terrell) [Member]
Maturity Date	[2]	Dec. 31, 2032
Description of property	[2]	Unified Housing Foundation, Inc. (Timbers of Terrell)
Interest Rate	[2]	12.00%
Performing loans, total	[2]	$ 1,323
Description of Security	[2]	Secured
Performing Loans [Member] | Unified Housing Foundation, Inc. (Tivoli) [Member]
Maturity Date	[2]	Dec. 31, 2032
Description of property	[2]	Unified Housing Foundation, Inc. (Tivoli)
Interest Rate	[2]	12.00%
Performing loans, total	[2]	$ 7,965
Description of Security	[2]	Secured
Performing Loans [Member] | Unified Housing Foundation, Inc. (Trails at White Rock) [Member]
Maturity Date	[2]	Dec. 31, 2032
Description of property	[2]	Unified Housing Foundation, Inc. (Trails at White Rock)
Interest Rate	[2]	12.00%
Performing loans, total	[2]	$ 3,815
Description of Security	[2]	Secured
Performing Loans [Member] | Unified Housing Foundation, Inc. #1 [Member]
Maturity Date	[2]	Dec. 31, 2018
Description of property	[2]	Unified Housing Foundation, Inc.
Interest Rate	[2]	12.00%
Performing loans, total	[2]	$ 3,994
Description of Security	[2]	Unsecured
Performing Loans [Member] | Unified Housing Foundation, Inc. #2 [Member]
Maturity Date	[2]	Dec. 31, 2018
Description of property	[2]	Unified Housing Foundation, Inc.
Interest Rate	[2]	12.00%
Performing loans, total	[2]	$ 6,407
Description of Security	[2]	Unsecured
Performing Loans [Member] | Unified Housing Foundation, Inc. #3 [Member]
Maturity Date	[2]	Jun. 30, 2020
Description of property	[2]	Unified Housing Foundation, Inc.
Interest Rate	[2]	12.00%
Performing loans, total	[2]	$ 5,760
Description of Security	[2]	Unsecured
Performing Loans [Member] | Unified Housing Foundation, Inc. #4 [Member]
Maturity Date	[2]	Mar. 31, 2021
Description of property	[2]	Unified Housing Foundation, Inc.
Interest Rate	[2]	12.00%
Performing loans, total	[2]	$ 5,314
Description of Security	[2]	Unsecured
Performing Loans [Member] | One Realco Corp [Member]
Maturity Date	[1],[2]	Jan. 31, 2020
Description of property	[1],[2]	One Realco Corporation
Interest Rate	[1],[2]	3.00%
Performing loans, total	[1],[2]	$ 7,000
Description of Security	[1],[2]	Unsecured
Performing Loans [Member] | Realty Advisors Mgmt [Member]
Maturity Date	[2]	Dec. 31, 2019
Description of property	[2]	Realty Advisors Management, Inc.
Interest Rate	[2]	2.28%
Performing loans, total	[2]	$ 20,387
Description of Security	[2]	Unsecured
Performing Loans [Member] | Other Related Party Notes #1 [Member]
Description of property		Other related party notes
Description of Interest Rate		Various
Performing loans, total		$ 1,349
Description of Security		Various secured interests
Performing Loans [Member] | Other Related Party Notes #2 [Member]
Description of property		Other related party notes
Description of Interest Rate		Various
Performing loans, total		$ 510
Description of Security		Various unsecured interests
Performing Loans [Member] | Other Non-Related Party Notes #1 [Member]
Description of property		Other non-related party notes
Description of Interest Rate		Various
Performing loans, total		$ 3,466
Description of Security		Various secured interests
Performing Loans [Member] | Other Non-Related Party Notes #2 [Member]
Description of property		Other non-related party notes
Description of Interest Rate		Various
Performing loans, total		$ 14,639
Description of Security		Various unsecured interests
[1]	An allowance was taken for estimated losses at full value of note.
[2]	Related party notes

NOTES AND INTEREST RECEIVABLE37

NOTES AND INTEREST RECEIVABLE (Details Narrative) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017	Jun. 30, 2017
Total notes and interest receivable	$ 126,507	$ 112,095	$ 106,874
Related Party [Member]
Total notes and interest receivable	$ 104,700

INVESTMENTS IN UNCONSOLIDATED S

INVESTMENTS IN UNCONSOLIDATED SUBSIDIARIES AND INVESTEES (Details)	Jun. 30, 2018	Jun. 30, 2017
Gruppa Florentina LLC [Member]
Schedule of Equity Method Investments [Line Items]
Percentage of ownership	20.00%	20.00%

INVESTMENTS IN UNCONSOLIDATED39

INVESTMENTS IN UNCONSOLIDATED SUBSIDIARIES AND INVESTEES (Details 1) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Schedule of Equity Method Investments [Line Items]
Real estate, net of accumulated depreciation	$ 1,010,244	$ 930,647	$ 1,010,244	$ 930,647	$ 988,117
Other assets	56,605		56,605		63,263
Shareholders' equity/partners capital	118,642		118,642		$ 112,074
Revenue	31,607	31,587	62,690	63,409
Operating expenses	27,990	26,759	54,155	54,103
Income from continuing operations	6,295	(10,848)	4,575	(17,197)
Net income	6,295	(11,324)	5,910	(17,228)
Company's proportionate share of earnings	277	153	597	208
Gruppa Florentina LLC [Member]
Schedule of Equity Method Investments [Line Items]
Real estate, net of accumulated depreciation	13,485	13,578	13,485	13,578
Notes receivable	10,918	9,969	10,918	9,969
Other assets	32,290	30,188	32,290	30,188
Notes payable	(10,745)	(9,514)	(10,745)	(9,514)
Other liabilities	(7,775)	(7,821)	(7,775)	(7,821)
Shareholders' equity/partners capital	$ (38,173)	$ (36,400)	(38,173)	(36,400)
Revenue			27,195	27,458
Depreciation			(728)	(575)
Operating expenses			(25,630)	(25,533)
Interest expense			(340)	(353)
Income from continuing operations			497	997
Net income			497	997
Company's proportionate share of earnings			$ 99	$ 199

INVESTMENT IN UNCONSOLIDATED 40

INVESTMENT IN UNCONSOLIDATED INVESTEES (Details Narrative) - Number	Jun. 30, 2018	Jun. 30, 2017
Gruppa Florentina LLC [Member]
Percentage of ownership	20.00%	20.00%
Minimum [Member]
Percentage of ownership	20.00%
Maximum [Member]
Percentage of ownership	50.00%
Blast 825 Pizza [Member] | Gruppa Florentina LLC [Member]
Investee's ownership percentage	100.00%
Number of stores	4
SienaCorp [Member] | Gruppa Florentina LLC [Member]
Investee's ownership percentage	100.00%
Number of stores	2
Number of restaurants franchise	23
Milano [Member] | Gruppa Florentina LLC [Member]
Investee's ownership percentage	100.00%
Number of stores	33
Piazza Del Pane, Inc. [Member] | Gruppa Florentina LLC [Member]
Investee's ownership percentage	100.00%
Number of stores	2

NOTES PAYABLE (Details)

NOTES PAYABLE (Details) $ in Thousands	Jun. 30, 2018USD ($)
Short-term Debt [Line Items]
Notes Payable	$ 919,492
Accrued Interest	2,345
Total Debt	921,837
Unamortized deferred borrowing costs	(17,843)
Apartments [Member]
Short-term Debt [Line Items]
Notes Payable	568,449
Accrued Interest	1,585
Total Debt	570,034
Apartments Under Construction [Member]
Short-term Debt [Line Items]
Notes Payable	118,665
Accrued Interest	31
Total Debt	118,696
Commercial [Member]
Short-term Debt [Line Items]
Notes Payable	125,807
Accrued Interest	616
Total Debt	126,423
Land [Member]
Short-term Debt [Line Items]
Notes Payable	21,734
Accrued Interest	197
Total Debt	21,931
Real Estate Subject To Sales Contract [Member]
Short-term Debt [Line Items]
Notes Payable	376
Total Debt	376
Mezzanine Financing [Member]
Short-term Debt [Line Items]
Notes Payable	93,422
Accrued Interest	509
Total Debt	93,931
Other [Member]
Short-term Debt [Line Items]
Notes Payable	8,882
Accrued Interest	(593)
Total Debt	8,289
Total Notes Payable [Member]
Short-term Debt [Line Items]
Notes Payable	937,335
Accrued Interest	2,345
Total Debt	$ 939,680

NOTES PAYABLE (Details Narrativ

NOTES PAYABLE (Details Narrative) $ in Thousands	6 Months Ended
	Jun. 30, 2018USD ($)
Construction Loans [Member]
Proceeds from construction loans	$ 44,700

BONDS PAYABLE (Details)

BONDS PAYABLE (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Less; deferred issuance expense, net	$ (17,843)
Accrued Interest	2,345
Nonconvertible Series A Bonds [Member]
Notes Payable	109,552	$ 115,336
Nonconvertible Series B Bonds [Member]
Notes Payable	37,726
Bonds [Member]
Less; deferred issuance expense, net	(7,210)	(5,916)
Accrued Interest	3,829	3,629
Bond and bond interest payable	$ 143,897	$ 113,049

BONDS PAYABLE (Details 1)

BONDS PAYABLE (Details 1) $ in Thousands	Jun. 30, 2018USD ($)
Year ended December 31,
2,018
2,019	23,067
2,020	23,067
2,021	23,067
2,022	30,903
Thereafter	47,174
Total	$ 147,278

BONDS PAYABLE (Details Narrativ

BONDS PAYABLE (Details Narrative) ₪ in Thousands, $ in Thousands	Jul. 26, 2018USD ($)	Jan. 25, 2018USD ($)	Jun. 30, 2018USD ($)	Jun. 30, 2017USD ($)	Feb. 15, 2018USD ($)	Feb. 15, 2018ILS (₪)	Dec. 31, 2017USD ($)	Dec. 31, 2017ILS (₪)
Foreign currency loss - debenture transactions			$ 7,600
Interest paid to bondholders			$ 31,000	$ 28,100
Nonconvertible Series A Bonds [Member]
Effective interest rate			9.17%
Interest paid to bondholders		$ 4,300
Nonconvertible Series A Bonds [Member] | Southern Properties Capital LTD [Member]
Debentures offering amount							$ 115,000
Interest rate							7.30%	7.30%
Nonconvertible Series A Bonds [Member] | Israel Shekel [Member]
Interest paid to bondholders		$ 14,600
Nonconvertible Series A Bonds [Member] | Israel Shekel [Member] | Southern Properties Capital LTD [Member]
Debentures offering amount | ₪								₪ 400,000
Nonconvertible Series B Bonds [Member]
Effective interest rate			7.99%
Nonconvertible Series B Bonds [Member] | Southern Properties Capital LTD [Member]
Debentures offering amount					$ 39,200
Interest rate					6.80%	6.80%
Nonconvertible Series B Bonds [Member] | Israel Shekel [Member] | Southern Properties Capital LTD [Member]
Debentures offering amount | ₪						₪ 137,700
Bonds [Member]
Bond issuance cost			$ 1,400
Subsequent Event [Member] | Series A and B Bonds [Member]
Interest paid to bondholders	$ 5,200
Subsequent Event [Member] | Series A and B Bonds [Member] | Israel Shekel [Member]
Interest paid to bondholders	$ 18,900

RELATED PARTY TRANSACTIONS (Det

RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Related party receivables [Roll Forward]
Related party receivable at beginning			$ 38,311
Advisory fees	$ (2,929)	$ (2,849)	(5,885)	$ (5,508)
Net income fee	(53)	$ (77)	(106)	(137)
Notes receivable purchased			(14,557)	$ (4,116)
Related party receivable at end	$ 55,987		55,987
Pillar Income Asset Management, Inc [Member]
Related party receivables [Roll Forward]
Related party receivable at beginning			38,311
Cash transfers			26,033
Advisory fees			(5,884)
Net income fee			(106)
Cost reimbursements			(2,346)
Interest income			1,347
Notes receivable purchased			(5,315)
Fees and commissions			(162)
Regis incentive fee
Expenses (paid) received by Advisor			4,845
Financing (mortgage payments)			(169)
Sales/purchases transactions			(567)
Tax sharing			$ 55,987

OPERATING SEGMENTS (Details)

OPERATING SEGMENTS (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Segment Reporting Information [Line Items]
Rental and other property revenues	$ 31,607	$ 31,587	$ 62,690	$ 63,409
Property operating expenses	(15,550)	(15,429)	(29,974)	(31,693)
Interest income	4,882	5,059	9,991	9,852
Gain (loss) on land sales		(476)	1,335	(31)
Segment operating (loss) income	3,617	4,828	8,535	9,306
Real estate assets	1,010,244	930,647	1,010,244	930,647
Commercial Properties [Member]
Segment Reporting Information [Line Items]
Rental and other property revenues	7,404	8,553	14,959	17,711
Property operating expenses	(4,238)	(4,900)	(7,986)	(9,839)
Depreciation	(2,323)	(2,397)	(4,616)	(4,699)
Mortgage and loan interest	(1,893)	(2,121)	(3,742)	(3,727)
Segment operating (loss) income	(1,050)	(865)	(1,385)	(554)
Capital expenditures	2,092	557	2,725	1,932
Real estate assets	135,288	148,718	135,288	148,718
Property Sales
Sales price	2,313		2,313
Cost of sale	(2,313)		(2,313)
Apartments [Member]
Segment Reporting Information [Line Items]
Rental and other property revenues	24,201	23,030	47,726	45,691
Property operating expenses	(11,199)	(10,211)	(21,782)	(20,956)
Depreciation	(4,195)	(4,030)	(8,344)	(8,076)
Mortgage and loan interest	(5,342)	(5,028)	(10,798)	(11,787)
Segment operating (loss) income	3,465	3,761	6,802	4,872
Capital expenditures				585
Real estate assets	762,410	654,119	762,410	654,119
Property Sales
Sales price			8,512
Cost of sale			(8,512)
Land [Member]
Segment Reporting Information [Line Items]
Rental and other property revenues			1
Property operating expenses	(135)	(168)	(134)	(447)
Mortgage and loan interest	65	(389)	(130)	(1,083)
Gain (loss) on land sales		(476)	1,335	(31)
Segment operating (loss) income	(70)	(1,033)	1,072	(1,561)
Capital expenditures		186
Real estate assets	111,899	127,810	111,899	127,810
Property Sales
Sales price		507	7,239	1,596
Cost of sale		(983)	(5,904)	(1,627)
Gain (loss) on sale		(476)	1,335	(31)
Other [Member]
Segment Reporting Information [Line Items]
Rental and other property revenues	2	4	4	7
Property operating expenses	22	(150)	(72)	(451)
Depreciation	14	18	65	36
Mortgage and loan interest	(8,737)	(9,809)	(16,961)	(17,546)
Interest income	4,882	5,059	9,991	9,852
Segment operating (loss) income	(3,817)	(4,878)	(6,973)	(8,102)
Real estate assets	647		647
Total Segments [Member]
Segment Reporting Information [Line Items]
Rental and other property revenues	31,607	31,587	62,690	63,409
Property operating expenses	(15,550)	(15,429)	(29,974)	(31,693)
Depreciation	(6,504)	(6,409)	(12,895)	(12,739)
Mortgage and loan interest	(15,907)	(17,347)	(31,631)	(34,143)
Interest income	4,882	5,059	9,991	9,852
Gain (loss) on land sales		(476)	1,335	(31)
Segment operating (loss) income	(1,472)	(3,015)	(484)	(5,345)
Capital expenditures	2,092	743	2,725	2,517
Real estate assets	1,010,244	930,647	1,010,244	930,647
Property Sales
Sales price	2,313	507	18,064	1,596
Cost of sale	$ (2,313)	(983)	(16,729)	(1,627)
Gain (loss) on sale		$ (476)	$ 1,335	$ (31)

OPERATING SEGMENTS (Details 1)

OPERATING SEGMENTS (Details 1) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Segment operating income (loss)	$ 3,617	$ 4,828	$ 8,535	$ 9,306
Other non-segment items of income (expense)
General and administrative	(2,954)	(1,995)	(5,295)	(4,026)
Net income fee to related party	(53)	(77)	(106)	(137)
Advisory fee to related party	(2,929)	(2,849)	(5,885)	(5,508)
Other income	7,537	(116)	9,438	1,327
Earnings from unconsolidated investees	277	153	597	208
Net income (loss) from continuing operations	6,295	(11,324)	5,910	(17,228)
Total Segments [Member]
Segment operating income (loss)	(1,472)	(3,015)	(484)	(5,345)
Other non-segment items of income (expense)
General and administrative	(2,954)	(1,995)	(5,295)	(4,026)
Net income fee to related party	(53)	(77)	(106)	(137)
Advisory fee to related party	(2,929)	(2,849)	(5,885)	(5,508)
Other income	13,426	(3,541)	17,083	(2,420)
Earnings from unconsolidated investees	277	153	597	208
Net income (loss) from continuing operations	$ 6,295	$ (11,324)	$ 5,910	$ (17,228)

OPERATING SEGMENTS (Details 2)

OPERATING SEGMENTS (Details 2) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017	Jun. 30, 2017
Segment Reporting [Abstract]
Segment assets	$ 1,010,244	$ 988,117	$ 930,647
Investments in unconsolidated investees	6,993	6,396	6,294
Notes and interest receivable	126,507	112,095	106,874
Other assets	205,360		188,921
Total assets	$ 1,349,104	$ 1,296,720	$ 1,232,736

COMMITMENTS, CONTINGENCIES, A50

COMMITMENTS, CONTINGENCIES, AND LIQUIDITY (Details Narrative) - USD ($) $ in Thousands	Jul. 20, 2015	Jan. 31, 2012	Oct. 31, 2011	Jun. 30, 2018
Notes Payable				$ 147,278
Dynex Capital, Inc.Litigation [Member]
Damages sought value	$ 160,000
Description of plaintiff	Basic Capital Management, Inc., American Realty Trust, Inc., Transcontinental Realty Investors, Inc., Continental Poydras Corp., Continental Common, Inc. and Continental Baronne, Inc.
Description of defendant	Dynex Commercial, Inc.
Domicile of litigation	68th Judicial District Court in Dallas County, Texas
Description of action taken by court	The Final Judgment entered against Dynex Commercial, Inc. on July 20, 2015 awarded Basic was $0.256 million in damages, plus pre-judgment interest of $0.192 million for a total amount of $0.448 million. The Judgment awarded ART was $14.2 million in damages, plus pre-judgment interest of $10.6 million for a total amount of $24.8 million. The Judgment awarded TCI was $11.1 million, plus pre-judgment interest of $8.4 million for a total amount of $19.5 million. The Judgment also awarded Basic, ART, and TCI post-judgment interest at the rate of 5% per annum from April 25, 2014 until the date their respective damages were paid. Lastly, the Judgement awarded Basic, ART, and TCI was $1.6 million collectively in attorneys’ fees from Dynex Commercial, Inc.
Unfunded loan commitment	$ 160,000
Awarded attorney fees	$ 1,600
Post-judgment interest rate	5.00%
Dynex Capital, Inc.Litigation [Member] | Southern Properties Capital LTD [Member]
Damages - awarded amount	$ 11,100
Damages - pre-judgement interest	8,400
Damages - total	19,500
Dynex Capital, Inc.Litigation [Member] | American Reality Trust, Inc. [Member]
Damages - awarded amount	14,200
Damages - pre-judgement interest	10,600
Damages - total	24,800
Dynex Capital, Inc.Litigation [Member] | Basic Capital Management, Inc. [Member]
Damages - awarded amount	256
Damages - pre-judgement interest	192
Damages - total	$ 448
ART and ART Midwest, Inc. Litigation [Member]
Damages sought value			$ 74,000
Actual damages sought value		$ 59,000	26,000
Interest damages sought value			$ 48,000
Description of plaintiff			Mr. David Clapper and entities related to Mr. Clapper (collectively, the “Clapper Parties”)
Description of defendant			A formerly owned entity (American Realty Trust, Inc.) and its former subsidiary (ART Midwest, Inc.)
Description of allegation			The matter originally involved a transaction in 1998 in which ART Midwest, Inc. was to acquire eight residential apartment complexes from the Clapper Parties.
Notes receivable from the sale of ART		$ 10,000
UHF Debt Guarantee [Member]
Loan guarantee amount				$ 39,100

EARNINGS PER SHARE (Details Nar

EARNINGS PER SHARE (Details Narrative) - Series A Cumulative Convertible Preferred Stock [Member] - USD ($) $ in Thousands	Jan. 12, 2018	Apr. 09, 2015	Jul. 17, 2014	Jun. 30, 2018	Jan. 10, 2018	Dec. 31, 2017
Shares held by subsidiaries				900,000		900,000
Percentage of the average daily closing price of common stock				90.00%
Preferred stock, dividend rate				10.00%
Number of trading days				20 days
RAI [Member]
Shares held by subsidiaries			2,451,435	900,000	1,100,000
Accrued dividends unpaid			$ 15,100	$ 9,200	$ 10,500
Number of preferred stock converted		460,638	890,797
Accumulated dividends unpaid upon conversion	$ 1,800	$ 2,300	$ 6,300
Number of common stock issued for conversion		1,486,741	2,502,230
Number of shares converted	200,000
Number of shares issued upon conversion	482,716

SUBSEQUENT EVENTS (Details Narr

SUBSEQUENT EVENTS (Details Narrative) ₪ in Thousands, $ in Thousands	6 Months Ended
	Jun. 30, 2018USD ($)	Jul. 19, 2018USD ($)	Jul. 19, 2018ILS (₪)
Foreign currency loss - debenture transactions	$ 7,600
Subsequent Event [Member] | Private Placement [Member] | Series B Bonds [Member]
Debentures offering amount		$ 19,800
Interest rate		6.80%	6.80%
Effective interest rate		9.63%	9.63%
Bond issuance cost		$ 1,900
Subsequent Event [Member] | Private Placement [Member] | Series B Bonds [Member] | Israel Shekel [Member]
Debentures offering amount | ₪			₪ 72,300