Document And Entity Information
Document And Entity Information - shares shares in Millions | 9 Months Ended | |
Sep. 30, 2018 | Nov. 01, 2018 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 | |
Entity Registrant Name | Lightstone Value Plus Real Estate Investment Trust, Inc. | |
Entity Central Index Key | 1,296,884 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 24 | |
Entity Emerging Growth Company | false | |
Entity Small Business | true |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Investment property: | ||
Land and improvements | $ 44,647 | $ 49,681 |
Building and improvements | 153,419 | 164,418 |
Furniture and fixtures | 2,236 | 2,154 |
Construction in progress | 270 | 204 |
Gross investment property | 200,572 | 216,457 |
Less accumulated depreciation | (39,548) | (37,956) |
Net investment property | 161,024 | 178,501 |
Investment in related parties | 114,791 | 159,792 |
Cash and cash equivalents | 61,829 | 116,434 |
Marketable securities, available for sale | 120,166 | 57,944 |
Restricted cash | 9,157 | 2,785 |
Tenant and other accounts receivable | 979 | 1,143 |
Intangible assets | 220 | 337 |
Prepaid expenses and other assets | 2,923 | 2,738 |
Total Assets | 471,089 | 519,674 |
Liabilities and Stockholders' Equity | ||
Mortgages payable, net | 117,186 | 157,927 |
Notes payable | 18,613 | 18,602 |
Accounts payable, accrued expenses and other liabilities | 21,451 | 20,388 |
Due to related parties | 293 | 496 |
Tenant allowances and deposits payable | 1,052 | 1,483 |
Distributions payable | 4,240 | 4,387 |
Deferred rental income | 829 | 716 |
Acquired below market lease intangibles | 199 | 305 |
Total Liabilities | 163,863 | 204,304 |
Commitments and contingencies | ||
Company's Stockholders Equity: | ||
Preferred shares, $0.01 par value, 10,000 shares authorized, none issued and outstanding | 0 | 0 |
Common stock, $0.01 par value; 60,000 shares authorized, 24,012 and 24,847 shares issued and outstanding, respectively | 240 | 248 |
Additional paid-in-capital | 187,908 | 194,497 |
Accumulated other comprehensive (loss)/income | (1,273) | 15,467 |
Accumulated surplus | 105,122 | 86,956 |
Total Company's stockholders' equity | 291,997 | 297,168 |
Noncontrolling interests | 15,229 | 18,202 |
Total Stockholders' Equity | 307,226 | 315,370 |
Total Liabilities and Stockholders' Equity | $ 471,089 | $ 519,674 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Preferred shares, par value | $ 0.01 | $ 0.01 |
Preferred shares, shares authorized | 10,000 | 10,000 |
Preferred shares, shares issued | 0 | 0 |
Preferred shares, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 60,000 | 60,000 |
Common stock, shares issued | 24,012 | 24,847 |
Common stock, shares outstanding | 24,012 | 24,847 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Revenues: | ||||
Rental income | $ 4,511 | $ 8,085 | $ 14,151 | $ 24,705 |
Tenant recovery income | 485 | 738 | 1,877 | 2,553 |
Other service income | 0 | 2,069 | 0 | 7,834 |
Total revenues | 4,996 | 10,892 | 16,028 | 35,092 |
Expenses: | ||||
Property operating expenses | 1,600 | 5,652 | 5,005 | 18,513 |
Real estate taxes | 318 | 602 | 1,283 | 1,951 |
General and administrative costs | 1,084 | 2,174 | 3,291 | 4,615 |
Depreciation and amortization | 1,639 | 2,738 | 5,217 | 8,252 |
Total operating expenses | 4,641 | 11,166 | 14,796 | 33,331 |
Operating income/(loss) | 355 | (274) | 1,232 | 1,761 |
Other income/(loss), net | 116 | (43) | 228 | 8 |
Interest and dividend income | 4,590 | 5,635 | 14,328 | 15,432 |
Interest expense | (2,005) | (3,581) | (7,333) | (10,776) |
Gain on disposition of real estate | 0 | 10,483 | 7,137 | 10,483 |
Loss on sale and redemption of marketable securities | (3) | (18) | (81) | (67) |
Unrealized gain on marketable equity securities | 1,436 | 0 | 1,096 | 0 |
Gain on satisfaction of mortgage receivable | 0 | 0 | 0 | 3,216 |
Net income | 4,489 | 12,202 | 16,607 | 20,057 |
Less: net income attributable to noncontrolling interests | (465) | (392) | (1,108) | (915) |
Net income attributable to Company's common shares | $ 4,024 | $ 11,810 | $ 15,499 | $ 19,142 |
Net income per Company's common share, basic and diluted | $ 0.17 | $ 0.47 | $ 0.63 | $ 0.77 |
Weighted average number of common shares outstanding, basic and diluted | 24,299 | 24,931 | 24,575 | 24,993 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Net income | $ 4,489 | $ 12,202 | $ 16,607 | $ 20,057 |
Other comprehensive income/(loss) | ||||
Holding gain/(loss) on marketable securities, available for sale | 127 | (48) | (1,370) | (2,789) |
Reclassification adjustment for loss included in net income | 3 | 18 | 81 | 67 |
Other comprehensive gain/(loss) | 130 | (30) | (1,289) | (2,722) |
Comprehensive income | 4,619 | 12,172 | 15,318 | 17,335 |
Less: Comprehensive income attributable to noncontrolling interests | (468) | (379) | (1,083) | (576) |
Comprehensive income attributable to Company's common shares | $ 4,151 | $ 11,793 | $ 14,235 | $ 16,759 |
CONSOLIDATED STATEMENT OF STOCK
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY - 9 months ended Sep. 30, 2018 - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Other Comprehensive Income/(loss) [Member] | Accumulated Surplus [Member] | Noncontrolling Interests [Member] |
BALANCE at Dec. 31, 2017 | $ 315,370 | $ 248 | $ 194,497 | $ 15,467 | $ 86,956 | $ 18,202 |
BALANCE, (in shares) at Dec. 31, 2017 | 24,847 | |||||
Reclassification of other accumulated comprehensive income to accumulated surplus (See Note 3) | 0 | $ 0 | 0 | (15,476) | 15,476 | 0 |
Net income | 16,607 | 0 | 0 | 0 | 15,499 | 1,108 |
Transfer of membership interests (See Note 7) | 0 | 0 | 1,500 | 0 | 0 | (1,500) |
Other comprehensive loss | (1,289) | 0 | 0 | (1,264) | 0 | (25) |
Distributions declared | (12,809) | 0 | 0 | 0 | (12,809) | 0 |
Distributions paid to noncontrolling interests | (2,562) | 0 | 0 | 0 | 0 | (2,562) |
Contributions received from noncontrolling interests | 6 | 0 | 0 | 0 | 0 | 6 |
Redemption and cancellation of shares | (8,097) | $ (8) | (8,089) | 0 | 0 | 0 |
Redemption and cancellation of shares (in shares) | (835) | |||||
BALANCE at Sep. 30, 2018 | $ 307,226 | $ 240 | $ 187,908 | $ (1,273) | $ 105,122 | $ 15,229 |
BALANCE, (in shares) at Sep. 30, 2018 | 24,012 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 16,607 | $ 20,057 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 5,217 | 8,252 |
Unrealized gain on marketable equity securities, available for sale | (1,096) | 0 |
Loss on sale of marketable securities, available for sale | 81 | 67 |
Gain on disposition of real estate | (7,137) | (10,483) |
Gain on satisfaction of mortgage receivable | 0 | (3,216) |
Other non-cash adjustments | 126 | 485 |
Changes in assets and liabilities: | ||
Increase in prepaid expenses and other assets | (467) | (339) |
Decrease in tenant and other accounts receivable | 211 | 426 |
Decrease in tenant allowances and deposits payable | (219) | (287) |
Increase in accounts payable, accrued expenses and other liabilities | 2,224 | 3,781 |
Decrease in due to related parties | (203) | (20) |
(Decrease)/increase in deferred rental income | 126 | (127) |
Net cash provided by operating activities | 15,470 | 18,596 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchase of investment property, net | (1,032) | (2,290) |
Purchase of marketable securities | (72,477) | (5,081) |
Collections on mortgage receivable | 0 | 8,109 |
Proceeds from sale and redemption of marketable securities | 9,982 | 936 |
Proceeds from preferred investments in related parties | 60,000 | 2,300 |
Proceeds from joint venture | 765 | 372 |
Investments in joint venture | (644) | (117) |
Investments in related parties | (15,120) | (13,739) |
Proceeds from sale of investment property and other real estate assets | 0 | 32,651 |
Net cash (used in)/provided by investing activities | (18,526) | 23,141 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Mortgage payments | (21,568) | (306) |
Redemption and cancellation of common stock | (8,097) | (2,052) |
Contributions received from noncontrolling interests | 6 | 8 |
Distributions paid to noncontrolling interests | (2,562) | (2,885) |
Distributions paid to Company's common stockholders | (12,956) | (13,116) |
Net cash used in financing activities | (45,177) | (18,351) |
Net change in cash, cash equivalents and restricted cash | (48,233) | 23,386 |
Cash, cash equivalents and restricted cash, beginning of year | 119,219 | 108,357 |
Cash, cash equivalents and restricted cash, end of period | 70,986 | 131,743 |
Supplemental cash flow information for the periods indicated is as follows: | ||
Cash paid for interest | 5,163 | 5,694 |
Distributions declared but not paid | 4,240 | 4,396 |
Non cash purchase of investment property | 125 | 336 |
Unrealized loss on marketable securities | 1,289 | 2,722 |
Assets transferred due to foreclosure | 13,521 | 27,028 |
Liabilities credited in foreclosure | 20,658 | 27,028 |
Reclassification of accumulated other comprehensive income to accumulated surplus | 15,476 | 0 |
Transfer of membership interests from noncontrolling interests to additional paid-in-capital | $ 1,500 | $ 0 |
Organization
Organization | 9 Months Ended |
Sep. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | 1. Organization Lightstone Value Plus Real Estate Investment Trust, Inc., a Maryland corporation (“Lightstone REIT”) was formed on June 8, 2004 (date of inception) and subsequently qualified as a real estate investment trust (“REIT”) during the year ending December 31, 2006. Lightstone REIT was formed primarily for the purpose of engaging in the business of investing in and owning commercial and residential real estate properties located throughout the United States. The Company also has and will continue to seek to originate, acquire and manage a diverse portfolio of real estate-related investments. Lightstone REIT is structured as an umbrella partnership REIT, or UPREIT, and substantially all of its current and future business is and will be conducted through Lightstone Value Plus REIT, L.P., a Delaware limited partnership formed on July 12, 2004 (the “Operating Partnership”), in which Lightstone REIT as the general partner, held a 98% interest as of September 30, 2018. The Lightstone REIT and the Operating Partnership and its subsidiaries are collectively referred to as the ‘‘Company’’ and the use of ‘‘we,’’ ‘‘our,’’ ‘‘us’’ or similar pronouns refers to the Lightstone REIT, its Operating Partnership or the Company as required by the context in which such pronoun is used. The Company is managed by Lightstone Value Plus REIT, LLC (the “Advisor”), an affiliate of the Lightstone Group, Inc., under the terms and conditions of an advisory agreement. The Lightstone Group, Inc. previously served as the Company’s sponsor (the “Sponsor”) during its initial public offering, which closed on October 10, 2008. Subject to the oversight of the Company’s board of directors (the “Board of Directors”), the Advisor has primary responsibility for making investment decisions and managing the Company’s day-to-day operations. Through his ownership and control of The Lightstone Group, David Lichtenstein is the indirect owner of the Advisor and the indirect owner and manager of Lightstone SLP, LLC, which has subordinated profits interests (“SLP units”) in the Operating Partnership. Mr. Lichtenstein also acts as the Company’s Chairman and Chief Executive Officer. As a result, he exerts influence over but does not control the Lightstone REIT or the Operating Partnership. The Company’s stock is not currently listed on a national securities exchange. The Company may seek to list its stock for trading on a national securities exchange only if a majority of its independent directors believe listing would be in the best interest of its stockholders. The Company does not intend to list its shares at this time. The Company does not anticipate that there would be any market for its shares of common stock until they are listed for trading. As of September 30, 2018, on a collective basis, the Company wholly or majority owned and consolidated the operating results and financial condition of 2 retail properties containing a total of approximately 0.5 million square feet of retail space, 10 industrial properties containing a total of approximately 0.5 million square feet of industrial space and one multi-family residential property containing a total of 199 units. All of the Company’s properties are located within the United States. As of September 30, 2018, the retail properties, the industrial properties and the multi-family residential properties were 83%, 68% and 97% occupied based on a weighted-average basis, respectively. Noncontrolling Interests As of September 30, 2018, the noncontrolling interests consist of (i) parties of the Company that hold units in the Operating Partnership and (ii) certain interests in consolidated subsidiaries. The units include SLP units, limited partner units and common units. The noncontrolling interests in consolidated subsidiaries include ownership interests in Pro-DFJV Holdings LLC (“PRO”) held by the Company’s Sponsor and 50-01 2nd St. Associates LLC (the “2nd Street Joint Venture”) held by the Company’s Sponsor and other affiliates. PRO’s holdings principally consist of Marco OP Units and Marco II OP Units (see Note 3). The 2nd Street Joint Venture owns Gantry Park, a multi-family apartment building located in Queens, NY. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation The consolidated financial statements include the accounts of the Lightstone REIT and its Operating Partnership and its subsidiaries (over which the Company exercises financial and operating control). All inter-company balances and transactions have been eliminated in consolidation. The accompanying unaudited interim consolidated financial statements and related notes should be read in conjunction with the audited Consolidated Financial Statements of the Company and related notes as contained in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2017. The unaudited interim consolidated financial statements include all adjustments (consisting only of normal recurring adjustments) and accruals necessary in the judgment of management for a fair presentation of the results for the periods presented. The accompanying unaudited consolidated financial statements of Lightstone Value Plus Real Estate Investment Trust, Inc. and its Subsidiaries have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses during a reporting period. The most significant assumptions and estimates relate to the valuation of real estate and real-estate related investments, marketable securities, depreciable lives, and revenue recognition. Application of these assumptions requires the exercise of judgment as to future uncertainties and, as a result, actual results could differ from these estimates. The consolidated balance sheet as of December 31, 2017 included herein has been derived from the consolidated balance sheet included in the Company's Annual Report on Form 10-K. The unaudited consolidated statements of operations for interim periods are not necessarily indicative of results for the full year or any other period. Recently Adopted Accounting Pronouncements Effective January 1, 2018, the Company adopted guidance issued by the Financial Accounting Standards Board (“FASB”) that requires amounts that are generally described as restricted cash and restricted cash equivalents to be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The Company adopted this standard using the retrospective transition method. As required by the Company’s lenders, restricted cash is held in escrow accounts for anticipated capital expenditures, real estate taxes, and other reserves for certain of our consolidated properties. Capital reserves are typically utilized for non-operating expenses such as tenant improvements, leasing commissions, and major capital expenditures. Alternatively, a lender may require its own formula for an escrow of capital reserves. Restricted cash may also include deposits for the purchase of real estate or certain funds temporarily placed in escrow with qualified intermediaries to facilitate potential like-kind exchange transactions in accordance with Section 1031 of the Internal Revenue Code of 1986, as amended. The following is a summary of the Company’s cash, cash equivalents, and restricted cash total as presented in our statements of cash flows for the periods presented: September 30, 2018 2017 Cash and cash equivalents $ 61,829 $ 127,381 Restricted cash 9,157 4,362 Total cash, cash equivalents and restricted cash $ 70,986 $ 131,743 Effective January 1, 2018, the Company adopted guidance issued by the FASB that that requires companies to measure investments in equity securities, except those accounted for under the equity method, at fair value and recognize any changes in fair value in net income, using a modified-retrospective approach. This resulted in a $15.5 million reclassification of aggregate net unrealized gains from accumulated other comprehensive income (“AOCI”) to opening accumulated surplus see Note 3. Effective January 1, 2018, the Company adopted guidance issued by the FASB that clarifies the definition of a business and assists in the evaluation of whether a transaction will be accounted for as an acquisition of an asset or as a business combination. The guidance provides a test to determine when a set of assets and activities acquired is not a business. When substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets, the set is not a business. Additionally, assets acquired, liabilities assumed, and any noncontrolling interest will be measured at their relative fair values. The Company anticipates future acquisitions of real estate assets, if any, will likely qualify as an asset acquisition. Therefore, any future transaction costs associated with an asset acquisition will be capitalized and accounted for in accordance with this guidance. Effective January 1, 2018, the Company adopted guidance issued by the FASB that outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most of the existing revenue recognition guidance. The new guidance requires companies to apply a five-step model in accounting for revenue arising from contracts with customers, as well as enhance disclosures regarding revenue recognition. Lease contracts are excluded from this revenue recognition criteria; however, the sale of real estate is required to follow the new model. The Company has adopted this standard for the year beginning on January 1, 2018 using the modified retrospective approach. The adoption of this pronouncement had no effect on our consolidated financial statements since, with the disposal of the DoubleTree – Danvers in September 2017, substantially all revenues now consist of rental income from leasing arrangements, which is specifically excluded from the standard. New Accounting Pronouncements In August 2018, the Securities and Exchange Commission adopted the final rule amending certain disclosure requirements that have become redundant, duplicative, overlapping, outdated, or superseded. In addition, the amendments expand the disclosure requirements on the analysis of stockholders' equity for interim financial statements. Under the amendments, an analysis of changes in each caption of stockholders' equity presented in the balance sheet must be provided in a note or separate statement. The rule was effective on November 5, 2018 and will be effective for the quarter that begins after the effective date. Since the Company already includes a year to date consolidated statement of stockholders’ equity in our interim financial statement filings, the adoption of this guidance will result in the inclusion of a quarter to date consolidated statement of stockholders equity in our second and third quarter interim financial statement filings and the inclusion of corresponding prior periods statement of stockholders’ equity for all periods presented. In June 2016, the FASB issued an accounting standards update which replaces the incurred loss impairment methodology currently in use with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The new guidance is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. This guidance will not have a material impact on the Company’s consolidated financial statements. In February 2016, the FASB issued an accounting standards update which supersedes the existing lease accounting model, and modifies both lessee and lessor accounting. The new guidance will require lessees to recognize a liability to make lease payments and a right-of-use asset, initially measured at the present value of lease payments, for both operating and financing leases, with classification affecting the pattern of expense recognition in the statement of earnings. For leases with a term of 12 months or less, lessees will be permitted to make an accounting policy election by class of underlying asset to not recognize lease liabilities and lease assets. The standard offers several practical expedients for transition and certain expedients specific to lessees or lessors. Both lessees and lessors are permitted to make an election to apply a package of practical expedients available for implementation under the standard. The Company intends to apply the package of practical expedients and certain other transition expedients. For transition, the Company intends to recognize all effects of transition in the beginning of the adoption reporting period on January 1, 2019. We expect that the adoption of this standard will result in the recognition of right-of-use assets and related lease liability accounts on the consolidated balance sheet but is not expected to have a material effect on our consolidated financial position or our results of operations, however, the ultimate impact of adopting this standard will depend on the Company’s lease portfolio as of the adoption date. The Company has reviewed and determined that other recently issued accounting pronouncements will not have a material impact on its financial position, results of operations and cash flows, or do not apply to its current operations. Reclassifications Certain prior period amounts may have been reclassified to conform to the current year presentation. |
Marketable Securities, Fair Val
Marketable Securities, Fair Value Measurements and Notes Payable | 9 Months Ended |
Sep. 30, 2018 | |
Marketable Securities And Fair Value Measurements [Abstract] | |
Marketable Securities and Fair Value Measurements | 3. Marketable Securities, Fair Value Measurements and Notes Payable Marketable Securities: The following is a summary of the Company’s available for sale securities as of the dates indicated: As of September 30, 2018 Adjusted Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Marketable Securities: Equity securities: Equity Securities, primarily REITs $ 1,405 $ 315 $ (5 ) $ 1,715 Marco OP Units and Marco II OP Units 19,227 17,757 - 36,984 20,632 18,072 (5 ) 38,699 Debt securities: Corporate Bonds and Preferred Securities 81,102 57 (1,055 ) 80,104 Mortgage Backed Securities ("MBS") 1,663 - (300 ) 1,363 82,765 57 (1,355 ) 81,467 Total $ 103,397 $ 18,129 $ (1,360 ) $ 120,166 As of December 31, 2017 Adjusted Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Marketable Securities: Equity securities: Equity Securities, primarily REITs $ 1,405 $ 263 $ - $ 1,668 Marco OP Units and Marco II OP Units 19,227 16,708 - 35,935 20,632 16,971 - 37,603 Debt securities: Corporate Bonds and Preferred Securities 18,494 371 (81 ) 18,784 Mortgage Backed Securities 1,856 - (299 ) 1,557 20,350 371 (380 ) 20,341 Total $ 40,982 $ 17,342 $ (380 ) $ 57,944 As of both September 30, 2018 and December 31, 2017, the Company held an aggregate of 209,243 Marco OP Units and Marco II OP Units, of which 89,695 were owned by PRO. The Marco OP Units and the Marco II OP Units are exchangeable for a similar number of common operating partnership units (“Simon OP Units”) of Simon Property Group, L.P., (“Simon OP”), the operating partnership of Simon Property Group, Inc. (“Simon”). Subject to the various conditions, the Company may elect to exchange the Marco OP Units and/or the Marco II OP Units to Simon OP Units which must be immediately delivered to Simon in exchange for cash or similar number of shares of Simon’s common stock (“Simon Stock”). Prior to January 1, 2018, the Company accounted for marketable equity securities at fair value with unrealized gains and losses recognized in AOCI on the consolidated balance sheet. Realized gains and losses on marketable equity securities sold or impaired were recognized on the consolidated statements of operations. On January 1, 2018, the Company adopted guidance issued by the FASB that required it to change the way it accounts for marketable equity securities. The Company’s marketable equity securities are measured at fair value and starting January 1, 2018 unrealized gains and losses are recognized on the consolidated statements of operations. Upon adoption, the Company reclassified $15.5 million of aggregate net unrealized gains from AOCI to opening accumulated surplus. The Company considers the declines in market value of certain of its investments to be temporary in nature as the unrealized losses were caused primarily by changes in market interest rates or widening credit spreads. When evaluating these investments for other-than-temporary impairment, the Company reviews factors such as the length of time and extent to which fair value has been below cost basis, the financial condition of the issuer and any changes thereto, and the Company’s intent to sell, or whether it is more likely than not it will be required to sell, the investment before recovery of the investment’s amortized cost basis. During the nine months ended September 30, 2018 and 2017, the Company did not recognize any impairment charges. As of September 30, 2018, the Company does not consider any of its investments to be other-than-temporarily impaired. The Company may sell certain of its investments prior to their stated maturities for strategic purposes, in anticipation of credit deterioration, or for duration management. At the time of purchase, the maturities of the Company’s MBS generally ranged from 27 years to 30 years. Fair Value Measurements Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The standard describes a fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value: • Level 1 – Quoted prices in active markets for identical assets or liabilities. • Level 2 – Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. • Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Marketable securities, available for sale, measured at fair value on a recurring basis as of the dates indicated are as follows: Fair Value Measurement Using As of September 30, 2018 Level 1 Level 2 Level 3 Total Marketable Securities: Equity Securities, primarily REITs $ 1,715 $ - $ - $ 1,715 Marco OP and OP II Units - 36,984 - 36,984 Corporate Bonds and Preferred Securities - 80,104 - 80,104 MBS - 1,363 - 1,363 Total $ 1,715 $ 118,451 $ - $ 120,166 Fair Value Measurement Using As of December 31, 2017 Level 1 Level 2 Level 3 Total Marketable Securities: Equity Securities, primarily REITs $ 1,668 $ - $ - $ 1,668 Marco OP and OP II Units - 35,935 - 35,935 Corporate Bonds and Preferred Securities - 18,784 - 18,784 MBS - 1,557 - 1,557 Total $ 1,668 $ 56,276 $ - $ 57,944 The fair values of the Company’s investments in Corporate Bonds and Preferred Securities and MBS are measured using readily available quoted prices for similar assets. Additionally, as noted and disclosed above, the Company’s Marco OP and Marco OP II Units are ultimately exchangeable for cash or similar number of shares of Simon Stock, therefore the Company uses the quoted market price of Simon Stock to measure the fair value of the Company’s Marco OP and Marco OP II Units. The following table summarizes the estimated fair value of our investments in marketable debt securities with stated contractual maturity dates, accounted for as available-for-sale securities and classified by the contractual maturity date of the securities: As of September 30, 2018 Due in 1 year $ 18,677 Due in 1 year through 5 years 44,716 Due in 5 years through 10 years 16,711 Due after 10 years 1,363 Total $ 81,467 The Company did not have any other significant financial assets or liabilities, which would require revised valuations that are recognized at fair value. Notes Payable Margin Loan The Company has access to a margin loan (the “Margin Loan”) from a financial institution that holds custody of certain of the Company’s marketable securities. The Margin Loan, which is due on demand, bears interest at Libor plus 0.85% (3.11% as of September 30, 2018) and is collateralized by the marketable securities in the Company’s account. The amounts available to the Company under the Margin Loan are at the discretion of the financial institution and not limited to the amount of collateral in its account. There were no amounts outstanding under this Margin Loan as of September 30, 2018 and December 31, 2017. Line of Credit The Company has a non-revolving credit facility (the “Line of Credit”) with a financial institution which permits borrowings up to $25.0 million. The Line of Credit expires on June 19, 2019 and bears interest at Libor plus 1.35% (3.61% as of September 30, 2018). The Line of Credit is collateralized by approximately 209,000 Marco OP Units and PRO guaranteed the Line of Credit. The amount outstanding under the Line of Credit was $18.6 million as of September 30, 2018 and December 31, 2017 and is included in Notes Payable on the consolidated balance sheets. The Company currently intends to seek to extend or replace the Line of Credit on or before its expiration. If we are unable to extend or replace the Line of Credit, we will repay the then outstanding balance in full at the expiration date using working capital, cash proceeds from the sale of assets and/or redemptions of our preferred investments in related parties. |
Mortgages Payable, Net
Mortgages Payable, Net | 9 Months Ended |
Sep. 30, 2018 | |
Loans Payable [Abstract] | |
Mortgages Payable, Net | 4. Mortgages Payable, Net Mortgages payable, net consists of the following: Property Interest Rate Weighted Average Interest Rate as of September 30, 2018 Maturity Date Amount Due at Maturity As of September 30, 2018 As of December 31, 2017 Gulf Coast Industrial Portfolio 9.83 % 9.83 % Due on demand $ 30,642 $ 30,642 $ 50,205 St. Augustine Outlet Center (Repaid in full - see below) - - 20,400 Gantry Park 4.48 % 4.48 % November 2024 65,317 73,638 74,500 DePaul Plaza LIBOR + 2.75 % 4.62 % June 2020 13,494 14,174 14,480 Total mortgages payable 5.92 % $ 109,453 118,454 159,585 Less: Deferred financing costs (1,268 ) (1,658 ) Total mortgages payable, net $ 117,186 $ 157,927 Libor as of September 30, 2018 and December 31, 2017 was 2.26% and 1.57 % On May 29, 2018, the Company repaid in full its $20.4 million recourse mortgage loan secured by the St. Augustine Outlet Center located in St. Augustine, Florida, with a scheduled maturity in August 2018. Certain of the Company’s debt agreements require the maintenance of certain ratios, including debt service coverage. The Company is currently in compliance with all of its financial debt covenants other than the non-recourse mortgage indebtedness originally secured by a portfolio of industrial properties (collectively, the “Gulf Coast Industrial Portfolio”) located in New Orleans, Louisiana (seven properties), Baton Rouge, Louisiana (three properties) and San Antonio, Texas (four properties), as discussed below. Additionally, certain of our mortgages payable also contain clauses providing for prepayment penalties. As a result of not meeting certain debt service coverage ratios on the non-recourse mortgage indebtedness secured by the Gulf Coast Industrial Portfolio (the “Gulf Coast Industrial Portfolio Mortgage”), the lender elected to retain the excess cash flow from these properties beginning in July 2011. During the third quarter of 2012, the Gulf Coast Industrial Portfolio Mortgage was transferred to a special servicer, who discontinued scheduled debt service payments and notified the Company that the Gulf Coast Industrial Portfolio Mortgage was in default and although originally due in February 2017 became due on demand. On June 5, 2018, the special servicer completed a partial foreclosure of the Gulf Coast Industrial Portfolio pursuant to which it foreclosed on the four properties located in San Antonio, Texas (the “San Antonio Assets”). The San Antonio Assets were sold in a foreclosure sale by the special servicer for an aggregate amount of approximately $20.7 million. (See Note 6) Upon consummation of the foreclosure sale, the buyers assumed the significant risks and rewards of ownership and took legal title and physical possession of the San Antonio Assets for the aggregate sales price of $20.7 million. The Company simultaneously received an aggregate credit of approximately $20.7 million against the total outstanding indebtedness of the Gulf Coast Industrial Portfolio Mortgage, of which $19.6 million and $1.1 million were applied by the Company against the outstanding principal and outstanding accrued interest payable, respectively, under the Gulf Coast Industrial Portfolio Mortgage. As a result, the remaining outstanding principal of the Gulf Coast Industrial Portfolio Mortgage was approximately $30.6 million as of September 30, 2018. The Company accrues default interest expense on the Gulf Coast Industrial Portfolio Mortgage pursuant to the terms of its loan agreement. Additionally, the Company previously accrued default interest expense on a non-recourse mortgage loan (the “Oakview Plaza Mortgage”), pursuant to the terms of its loan agreement during the period from January 2017 through September 2017. The Oakview Plaza Mortgage was secured by a retail shopping center located in Omaha, Nebraska (“Oakview Plaza”). The lender foreclosed on Oakview Plaza in September 2017. Default interest expense related to the Gulf Coast Industrial Mortgage of $0.3 million and $1.3 million was accrued during the three and nine months ended September 30, 2018, respectively, and default interest expense related to both the Gulf Coast Industrial Portfolio Mortgage and the Oakview Plaza Mortgage of $0.8 million and $2.5 million was accrued during the three and nine months ended September 30, 2017, respectively. Cumulative accrued default interest expense (solely related the Gulf Coast Industrial Portfolio Mortgage) of $12.5 million and $11.2 million is included in accounts payable, accrued expenses and other liabilities on our consolidated balance sheets as of September 30, 2018 and December 31, 2017, respectively. Additionally, the Company believes the continued loss of excess cash flow from the Gulf Coast Industrial Portfolio and the special servicer’s placement of the non-recourse mortgage indebtedness in default will not have a material impact on its results of operations or financial position. Other than the Gulf Coast Industrial Portfolio Mortgage, the Company has no additional significant maturities of mortgage debt over the next 12 months. The following table shows the contractually scheduled principal maturities of the Company’s mortgage debt during the next five years and thereafter as of September 30, 2018: 2018 2019 2020 2021 2022 Thereafter Total Principal maturities $ 31,041 $ 1,621 $ 14,924 $ 1,328 $ 1,389 $ 68,151 $ 118,454 Less: Deferred financing costs (1,268 ) Total principal maturities, net $ 117,186 |
Net Earnings Per Share
Net Earnings Per Share | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
Net Earnings Per Share | 5. Net Earnings Per Share Basic net earnings per share is calculated by dividing net income attributable to common shareholders by the weighted-average number of shares of common stock outstanding during the applicable period. Diluted net income per share includes the potentially dilutive effect, if any, which would occur if our outstanding options to purchase our common stock were exercised. For all periods presented, dilutive net income per share is equivalent to basic net income per share. |
Disposition
Disposition | 9 Months Ended |
Sep. 30, 2018 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Disposition | 6. Disposition Gulf Coast Industrial Portfolio – San Antonio Assets As previously discussed in Note 4, on June 5, 2018, the special servicer for the Gulf Coast Industrial Portfolio Mortgage completed a partial foreclosure of the Gulf Coast Industrial Portfolio pursuant to which it foreclosed on the San Antonio Assets. The San Antonio Assets were sold in a foreclosure sale by the special servicer for an aggregate amount of approximately $20.7 million. Upon consummation of the foreclosure sale, the buyers assumed the significant risks and rewards of ownership and took legal title and physical possession of the San Antonio Assets for the agreed upon sales price of $20.7 million. The Company simultaneously received an aggregate credit of approximately $20.7 million which it applied against the total outstanding indebtedness (approximately $19.6 million and $1.1 million of principal and accrued interest payable, respectively) of the Gulf Coast Industrial Portfolio Mortgage. The aggregate carrying value of the assets transferred and the liabilities extinguished in connection with the foreclosure of the San Antonio Assets were approximately $13.6 million and $20.7 million, respectively. Since the Company’s performance obligations were met at the closing of the foreclosure sales and the Company has no continuing involvement with the San Antonio Assets an aggregate gain on disposition of real estate of approximately $7.1 million was recognized during the second quarter of 2018. The disposition of San Antonio Assets did not qualify to be reported as discontinued operations since the disposition did not represent a strategic shift that had a major effect on the Company’s operations and financial results. Accordingly, the operating results of the San Antonio Assets are reflected in the Company’s results from continuing operations for all periods presented through their respective date of disposition. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 7. Related Party Transactions The Company has agreements with the Advisor and Lightstone Value Plus REIT Management LLC (the “Property Manager”) to pay certain fees in exchange for services performed by these entities and other affiliated entities. The Company’s ability to secure financing and subsequent real estate operations are dependent upon its Advisor, Property Manager and their affiliates to perform such services as provided in these agreements. The Company, pursuant to the related party arrangements, has recorded the following amounts for the periods indicated: Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Asset management fees (general and administrative costs) $ 392 $ 556 $ 1,283 $ 1,684 Property management fees (property operating expenses) 120 199 409 576 Development fees and leasing commissions* 62 125 182 706 Total $ 574 $ 880 $ 1,874 $ 2,966 * Generally, capitalized and amortized over the estimated useful life of the associated asset. In connection with the Company’s initial public offering, Lightstone SLP, LLC, an affiliate of the Company’s Sponsor, previously purchased an aggregate of $30.0 million of SLP units which are included in noncontrolling interests in the consolidated balance sheets. These SLP units, the purchase price of which will be repaid only after stockholders receive a stated preferred return and their net investment, entitle Lightstone SLP, LLC to a portion of any regular distributions made by the Operating Partnership. During the three and nine months ended September 30, 2018, distributions of $0.5 million and $1.5 million were declared and paid on the SLP units. On September 19, 2018, the Company’s Sponsor transferred approximately 9.14% of its ownership in PRO, valued at the estimated fair value of $1.5 million to the Operating a 10.03% and a 19.17% membership interest in PRO, respectively, which is accounted for as noncontrolling interests. Preferred Investments The Company has entered into several agreements with various related party entities that provide for it to make preferred contributions pursuant to certain instruments (the “Preferred Investments”) that entitle the Company to certain prescribed monthly preferred distributions. The Preferred Investments had an aggregate balance of $113.4 million and $158.3 million as of September 30, 2018 and December 31, 2017, respectively, and are classified as held-to-maturity securities, recorded at cost and included in investments in related parties on the consolidated balance sheets. The fair value of these investments approximated their carrying values based on market rates for similar instruments. During the nine months ended September 30, 2018, the Company made an aggregate $15.1 million of additional contributions and redeemed the entire $60.0 million outstanding on the 485 7 th The Preferred Investments are summarized as follows: Preferred Investment Balance Unfunded Contributions Investment Income As of As of As of Three Months Ended September 30, Nine Months Ended September 30, Preferred Investments Dividend Rate September 30, 2018 December 31, 2017 September 30, 2018 2018 2017 2018 2017 40 East End Avenue (1) 8% to 12 % $ 30,000 $ 30,000 $ - $ 920 $ 920 $ 2,730 $ 2,463 30-02 39 th 12 % 10,000 10,000 - 307 307 910 946 485 7th Avenue 12 % - 60,000 - - 1,840 1,095 5,460 East 11th Street 12 % 57,500 46,119 - 1,763 1,155 4,970 3,135 Miami Moxy 12 % 15,933 12,195 4,067 457 346 1,229 905 Total Preferred Investments $ 113,433 $ 158,314 $ 4,067 $ 3,447 $ 4,568 $ 10,934 $ 12,909 Note: (1) - The dividend rate increased from 8% to 12% during March 2017 in connection with the procurement of construction financing on this project. The Joint Venture The Company has a 2.5% membership interest in a joint venture (the “Joint Venture”) with Lightstone Value Plus Real Estate Investment Trust II, Inc. (“Lightstone II”), a related party REIT also sponsored by our Sponsor. The Joint Venture previously acquired our membership interests in a portfolio of 11 hotels in a series of transactions completed during 2015. During the third quarter of 2017, the Joint Venture sold its ownership interests in four of the hotels to an unrelated third party. On November 6, 2017, the Joint Venture acquired a 170-room select service hotel located in New Orleans, Louisiana (the “Hyatt – New Orleans”) from an unrelated third party. As a result, the Joint Venture holds ownership interests in eight hotels as of September 30, 2018. The Company accounts for its 2.5% membership interest in the Joint Venture under the cost method and as of September 30, 2018 and December 31, 2017, the carrying value of its investment was $1.4 million and $1.5 million, respectively, which is included in investment in related parties on the consolidated balance sheets. |
Financial Instruments
Financial Instruments | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Financial Instruments | 8. Financial Instruments The carrying amounts reported in the consolidated balance sheets for cash and cash equivalents, restricted cash, tenant and other accounts receivable, accounts payable, accrued expenses and other liabilities and due to related parties approximated their fair values because of the short maturity of these instruments. T he estimated fair value of the notes payable (line of credit) approximated its carrying value ($18.6 million) because of its floating interest rate. The estimated fair value (in millions) of the Company’s mortgage debt is summarized as follows: As of September 30, 2018 As of December 31, 2017 Carrying Amount Estimated Fair Value Carrying Amount Estimated Fair Value Mortgages payable $ 118.5 $ 116.7 $ 159.6 $ 158.6 The fair value of the mortgages payable was determined by discounting the future contractual interest and principal payments by estimated current market interest rates. |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2018 | |
Segment Reporting [Abstract] | |
Segment Information | 9. Segment Information The Company has historically operated within four business segments which are: (i) retail real estate (the “Retail Segment”), (ii) multi-family residential real estate (the “Multi-Family Residential Segment”), (iii) industrial real estate (the “Industrial Segment”) and (iv) hospitality (the “Hospitality Segment”). However, during the third quarter of 2017, the Company sold its only remaining consolidated hospitality property and therefore, no longer has a Hospitality Segment. The Company’s Advisor and its affiliates provide leasing, property and facilities management, acquisition, development, construction and tenant-related services for its portfolio. The Company’s revenues for the three and nine months ended September 30, 2018 and 2017 were exclusively derived from activities in the United States. No revenues from foreign countries were received or reported. The Company had no long-lived assets in foreign locations as of September 30, 2018 and December 31, 2017. The accounting policies of the segments are the same as those described in Note 2: Summary of Significant Accounting Policies of the Company’s December 31, 2017 Annual Report on Form 10-K. Unallocated assets, revenues and expenses relate to corporate related accounts, including the Company’s Preferred Investments in Related Parties (see Note 7). The Company evaluates performance based upon net operating income/(loss) from the combined properties in each real estate segment. Selected results of operations for the three and nine months ended September 30, 2018 and 2017, and total assets as of September 30, 2018 and December 31, 2017 regarding the Company’s operating segments are as follows: For the Three Months Ended September 30, 2018 Retail Multi-Family Industrial Hospitality Unallocated Total Total revenues $ 1,774 2,256 966 $ - $ - $ 4,996 Property operating expenses 727 497 376 - - 1,600 Real estate taxes 212 18 88 - - 318 General and administrative costs 5 (4 ) (1 ) - 1,084 1,084 Net operating income/(loss) 830 1,745 503 - (1,084 ) 1,994 Depreciation and amortization 889 411 339 - - 1,639 Operating (loss)/income $ (59 ) $ 1,334 $ 164 $ - $ (1,084 ) $ 355 As of September 30, 2018: Total Assets $ 69,098 $ 66,845 $ 37,018 $ - $ 298,128 $ 471,089 For the Three Months Ended September 30, 2017 Retail Multi-Family Industrial Hospitality Unallocated Total Total revenues $ 2,452 2,118 $ 1,581 $ 4,741 $ - $ 10,892 Property operating expenses 905 492 631 3,620 4 5,652 Real estate taxes 361 19 162 60 - 602 General and administrative costs 39 3 6 107 2,019 2,174 Net operating income/(loss) 1,147 1,604 782 954 (2,023 ) 2,464 Depreciation and amortization 1,387 407 458 486 - 2,738 Operating (loss)/income $ (240 ) $ 1,197 $ 324 $ 468 $ (2,023 ) $ (274 ) As of December 31, 2017: Total Assets $ 70,758 $ 67,966 $ 49,461 $ 61,316 $ 270,173 519,674 For the Nine Months Ended September 30, 2018 Retail Multi-Family Industrial Hospitality Unallocated Total Total revenues $ 5,345 6,702 $ 3,981 $ - $ - $ 16,028 Property operating expenses 2,170 1,485 1,350 - - 5,005 Real estate taxes 735 54 494 - - 1,283 General and administrative costs 1 1 (8 ) - 3,297 3,291 Net operating income/(loss) 2,439 5,162 2,145 - (3,297 ) 6,449 Depreciation and amortization 2,756 1,231 1,230 - - 5,217 Operating (loss)/income $ (317 ) $ 3,931 $ 915 $ - $ (3,297 ) $ 1,232 For the Nine Months Ended September 30, 2017 Retail Multi-Family Industrial Hospitality Unallocated Total Total revenues $ 7,805 $ 6,443 $ 4,683 $ 16,161 $ - $ 35,092 Property operating expenses 2,782 1,430 1,679 12,617 5 18,513 Real estate taxes 1,120 55 555 221 - 1,951 General and administrative costs 129 33 (10 ) 225 4,238 4,615 Net operating income/(loss) 3,774 4,925 2,459 3,098 (4,243 ) 10,013 Depreciation and amortization 3,759 1,218 1,339 1,936 - 8,252 Operating income/(loss) $ 15 $ 3,707 $ 1,120 $ 1,162 $ (4,243 ) $ 1,761 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 10. Commitments and Contingencies Legal Proceedings From time to time in the ordinary course of business, the Company may become subject to legal proceedings, claims or disputes. As of the date hereof, the Company is not a party to any material pending legal proceedings of which the outcome is probable or reasonably possible to have a material adverse effect on its results of operations or financial condition, which would require accrual or disclosure of the contingency and possible range of loss. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | 11. Subsequent Events Distribution Payment On October 15, 2018, the distribution for the three-month period ending September 30, 2018 of $4.2 million was paid in cash. Distribution Declaration On November 8, 2018 the Board of Directors authorized and the Company declared a distribution for the three-month period ending December 31, 2018. The distribution will be calculated based on shareholders of record each day during this three-month period at a rate of $0.0019178 per day, and will equal a daily amount that, if paid each day for a 365-day period, would equal a 7.0% annualized rate based on a share price of $10.00. The distribution will be paid in cash on or about January 15, 2019 to shareholders of record as of December 31, 2018. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The consolidated financial statements include the accounts of the Lightstone REIT and its Operating Partnership and its subsidiaries (over which the Company exercises financial and operating control). All inter-company balances and transactions have been eliminated in consolidation. The accompanying unaudited interim consolidated financial statements and related notes should be read in conjunction with the audited Consolidated Financial Statements of the Company and related notes as contained in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2017. The unaudited interim consolidated financial statements include all adjustments (consisting only of normal recurring adjustments) and accruals necessary in the judgment of management for a fair presentation of the results for the periods presented. The accompanying unaudited consolidated financial statements of Lightstone Value Plus Real Estate Investment Trust, Inc. and its Subsidiaries have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses during a reporting period. The most significant assumptions and estimates relate to the valuation of real estate and real-estate related investments, marketable securities, depreciable lives, and revenue recognition. Application of these assumptions requires the exercise of judgment as to future uncertainties and, as a result, actual results could differ from these estimates. The consolidated balance sheet as of December 31, 2017 included herein has been derived from the consolidated balance sheet included in the Company's Annual Report on Form 10-K. The unaudited consolidated statements of operations for interim periods are not necessarily indicative of results for the full year or any other period. |
New Accounting Pronouncements | Recently Adopted Accounting Pronouncements Effective January 1, 2018, the Company adopted guidance issued by the Financial Accounting Standards Board (“FASB”) that requires amounts that are generally described as restricted cash and restricted cash equivalents to be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The Company adopted this standard using the retrospective transition method. As required by the Company’s lenders, restricted cash is held in escrow accounts for anticipated capital expenditures, real estate taxes, and other reserves for certain of our consolidated properties. Capital reserves are typically utilized for non-operating expenses such as tenant improvements, leasing commissions, and major capital expenditures. Alternatively, a lender may require its own formula for an escrow of capital reserves. Restricted cash may also include deposits for the purchase of real estate or certain funds temporarily placed in escrow with qualified intermediaries to facilitate potential like-kind exchange transactions in accordance with Section 1031 of the Internal Revenue Code of 1986, as amended. The following is a summary of the Company’s cash, cash equivalents, and restricted cash total as presented in our statements of cash flows for the periods presented: September 30, 2018 2017 Cash and cash equivalents $ 61,829 $ 127,381 Restricted cash 9,157 4,362 Total cash, cash equivalents and restricted cash $ 70,986 $ 131,743 Effective January 1, 2018, the Company adopted guidance issued by the FASB that that requires companies to measure investments in equity securities, except those accounted for under the equity method, at fair value and recognize any changes in fair value in net income, using a modified-retrospective approach. This resulted in a $15.5 million reclassification of aggregate net unrealized gains from accumulated other comprehensive income (“AOCI”) to opening accumulated surplus see Note 3. Effective January 1, 2018, the Company adopted guidance issued by the FASB that clarifies the definition of a business and assists in the evaluation of whether a transaction will be accounted for as an acquisition of an asset or as a business combination. The guidance provides a test to determine when a set of assets and activities acquired is not a business. When substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets, the set is not a business. Additionally, assets acquired, liabilities assumed, and any noncontrolling interest will be measured at their relative fair values. The Company anticipates future acquisitions of real estate assets, if any, will likely qualify as an asset acquisition. Therefore, any future transaction costs associated with an asset acquisition will be capitalized and accounted for in accordance with this guidance. Effective January 1, 2018, the Company adopted guidance issued by the FASB that outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most of the existing revenue recognition guidance. The new guidance requires companies to apply a five-step model in accounting for revenue arising from contracts with customers, as well as enhance disclosures regarding revenue recognition. Lease contracts are excluded from this revenue recognition criteria; however, the sale of real estate is required to follow the new model. The Company has adopted this standard for the year beginning on January 1, 2018 using the modified retrospective approach. The adoption of this pronouncement had no effect on our consolidated financial statements since, with the disposal of the DoubleTree – Danvers in September 2017, substantially all revenues now consist of rental income from leasing arrangements, which is specifically excluded from the standard. New Accounting Pronouncements In August 2018, the Securities and Exchange Commission adopted the final rule amending certain disclosure requirements that have become redundant, duplicative, overlapping, outdated, or superseded. In addition, the amendments expand the disclosure requirements on the analysis of stockholders' equity for interim financial statements. Under the amendments, an analysis of changes in each caption of stockholders' equity presented in the balance sheet must be provided in a note or separate statement. The rule was effective on November 5, 2018 and will be effective for the quarter that begins after the effective date. Since the Company already includes a year to date consolidated statement of stockholders’ equity in our interim financial statement filings, the adoption of this guidance will result in the inclusion of a quarter to date consolidated statement of stockholders equity in our second and third quarter interim financial statement filings and the inclusion of corresponding prior periods statement of stockholders’ equity for all periods presented. In June 2016, the FASB issued an accounting standards update which replaces the incurred loss impairment methodology currently in use with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The new guidance is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. This guidance will not have a material impact on the Company’s consolidated financial statements. In February 2016, the FASB issued an accounting standards update which supersedes the existing lease accounting model, and modifies both lessee and lessor accounting. The new guidance will require lessees to recognize a liability to make lease payments and a right-of-use asset, initially measured at the present value of lease payments, for both operating and financing leases, with classification affecting the pattern of expense recognition in the statement of earnings. For leases with a term of 12 months or less, lessees will be permitted to make an accounting policy election by class of underlying asset to not recognize lease liabilities and lease assets. The standard offers several practical expedients for transition and certain expedients specific to lessees or lessors. Both lessees and lessors are permitted to make an election to apply a package of practical expedients available for implementation under the standard. The Company intends to apply the package of practical expedients and certain other transition expedients. For transition, the Company intends to recognize all effects of transition in the beginning of the adoption reporting period on January 1, 2019. We expect that the adoption of this standard will result in the recognition of right-of-use assets and related lease liability accounts on the consolidated balance sheet but is not expected to have a material effect on our consolidated financial position or our results of operations, however, the ultimate impact of adopting this standard will depend on the Company’s lease portfolio as of the adoption date. The Company has reviewed and determined that other recently issued accounting pronouncements will not have a material impact on its financial position, results of operations and cash flows, or do not apply to its current operations. |
Reclassifications | Reclassifications Certain prior period amounts may have been reclassified to conform to the current year presentation. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Restrictions on Cash and Cash Equivalents | The following is a summary of the Company’s cash, cash equivalents, and restricted cash total as presented in our statements of cash flows for the periods presented: September 30, 2018 2017 Cash and cash equivalents $ 61,829 $ 127,381 Restricted cash 9,157 4,362 Total cash, cash equivalents and restricted cash $ 70,986 $ 131,743 |
Marketable Securities, Fair V_2
Marketable Securities, Fair Value Measurements and Notes Payable (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Marketable Securities And Fair Value Measurements [Abstract] | |
Summary of Available for Sale Securities | The following is a summary of the Company’s available for sale securities as of the dates indicated: As of September 30, 2018 Adjusted Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Marketable Securities: Equity securities: Equity Securities, primarily REITs $ 1,405 $ 315 $ (5 ) $ 1,715 Marco OP Units and Marco II OP Units 19,227 17,757 - 36,984 20,632 18,072 (5 ) 38,699 Debt securities: Corporate Bonds and Preferred Securities 81,102 57 (1,055 ) 80,104 Mortgage Backed Securities ("MBS") 1,663 - (300 ) 1,363 82,765 57 (1,355 ) 81,467 Total $ 103,397 $ 18,129 $ (1,360 ) $ 120,166 As of December 31, 2017 Adjusted Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Marketable Securities: Equity securities: Equity Securities, primarily REITs $ 1,405 $ 263 $ - $ 1,668 Marco OP Units and Marco II OP Units 19,227 16,708 - 35,935 20,632 16,971 - 37,603 Debt securities: Corporate Bonds and Preferred Securities 18,494 371 (81 ) 18,784 Mortgage Backed Securities 1,856 - (299 ) 1,557 20,350 371 (380 ) 20,341 Total $ 40,982 $ 17,342 $ (380 ) $ 57,944 |
Marketable Securities, Available for Sale, and Derivative Financial Instruments Measured at Fair Value on Recurring Basis | Marketable securities, available for sale, measured at fair value on a recurring basis as of the dates indicated are as follows: Fair Value Measurement Using As of September 30, 2018 Level 1 Level 2 Level 3 Total Marketable Securities: Equity Securities, primarily REITs $ 1,715 $ - $ - $ 1,715 Marco OP and OP II Units - 36,984 - 36,984 Corporate Bonds and Preferred Securities - 80,104 - 80,104 MBS - 1,363 - 1,363 Total $ 1,715 $ 118,451 $ - $ 120,166 Fair Value Measurement Using As of December 31, 2017 Level 1 Level 2 Level 3 Total Marketable Securities: Equity Securities, primarily REITs $ 1,668 $ - $ - $ 1,668 Marco OP and OP II Units - 35,935 - 35,935 Corporate Bonds and Preferred Securities - 18,784 - 18,784 MBS - 1,557 - 1,557 Total $ 1,668 $ 56,276 $ - $ 57,944 |
Available-for-sale Securities | The following table summarizes the estimated fair value of our investments in marketable debt securities with stated contractual maturity dates, accounted for as available-for-sale securities and classified by the contractual maturity date of the securities: As of September 30, 2018 Due in 1 year $ 18,677 Due in 1 year through 5 years 44,716 Due in 5 years through 10 years 16,711 Due after 10 years 1,363 Total $ 81,467 |
Mortgages Payable, Net (Tables)
Mortgages Payable, Net (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Loans Payable [Abstract] | |
Schedule of Mortgages Payable, net | Mortgages payable, net consists of the following: Property Interest Rate Weighted Average Interest Rate as of September 30, 2018 Maturity Date Amount Due at Maturity As of September 30, 2018 As of December 31, 2017 Gulf Coast Industrial Portfolio 9.83 % 9.83 % Due on demand $ 30,642 $ 30,642 $ 50,205 St. Augustine Outlet Center (Repaid in full - see below) - - 20,400 Gantry Park 4.48 % 4.48 % November 2024 65,317 73,638 74,500 DePaul Plaza LIBOR + 2.75 % 4.62 % June 2020 13,494 14,174 14,480 Total mortgages payable 5.92 % $ 109,453 118,454 159,585 Less: Deferred financing costs (1,268 ) (1,658 ) Total mortgages payable, net $ 117,186 $ 157,927 |
Contractually Scheduled Principal Maturities During Next Five Years | The following table shows the contractually scheduled principal maturities of the Company’s mortgage debt during the next five years and thereafter as of September 30, 2018: 2018 2019 2020 2021 2022 Thereafter Total Principal maturities $ 31,041 $ 1,621 $ 14,924 $ 1,328 $ 1,389 $ 68,151 $ 118,454 Less: Deferred financing costs (1,268 ) Total principal maturities, net $ 117,186 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Related Party Transactions [Abstract] | |
Amount Recorded in Pursuant to Related Party Arrangment | The Company, pursuant to the related party arrangements, has recorded the following amounts for the periods indicated: Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Asset management fees (general and administrative costs) $ 392 $ 556 $ 1,283 $ 1,684 Property management fees (property operating expenses) 120 199 409 576 Development fees and leasing commissions* 62 125 182 706 Total $ 574 $ 880 $ 1,874 $ 2,966 * Generally, capitalized and amortized over the estimated useful life of the associated asset. |
Preferred Investments | The Preferred Investments are summarized as follows: Preferred Investment Balance Unfunded Contributions Investment Income As of As of As of Three Months Ended September 30, Nine Months Ended September 30, Preferred Investments Dividend Rate September 30, 2018 December 31, 2017 September 30, 2018 2018 2017 2018 2017 40 East End Avenue (1) 8% to 12 % $ 30,000 $ 30,000 $ - $ 920 $ 920 $ 2,730 $ 2,463 30-02 39 th 12 % 10,000 10,000 - 307 307 910 946 485 7th Avenue 12 % - 60,000 - - 1,840 1,095 5,460 East 11th Street 12 % 57,500 46,119 - 1,763 1,155 4,970 3,135 Miami Moxy 12 % 15,933 12,195 4,067 457 346 1,229 905 Total Preferred Investments $ 113,433 $ 158,314 $ 4,067 $ 3,447 $ 4,568 $ 10,934 $ 12,909 Note: (1) - The dividend rate increased from 8% to 12% during March 2017 in connection with the procurement of construction financing on this project. |
Financial Instruments (Tables)
Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Summary of Estimated Fair Value of Debt | The estimated fair value (in millions) of the Company’s mortgage debt is summarized as follows: As of September 30, 2018 As of December 31, 2017 Carrying Amount Estimated Fair Value Carrying Amount Estimated Fair Value Mortgages payable $ 118.5 $ 116.7 $ 159.6 $ 158.6 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Segment Reporting [Abstract] | |
Results of Operations and Total Assets of Operating Segments | Selected results of operations for the three and nine months ended September 30, 2018 and 2017, and total assets as of September 30, 2018 and December 31, 2017 regarding the Company’s operating segments are as follows: For the Three Months Ended September 30, 2018 Retail Multi-Family Industrial Hospitality Unallocated Total Total revenues $ 1,774 2,256 966 $ - $ - $ 4,996 Property operating expenses 727 497 376 - - 1,600 Real estate taxes 212 18 88 - - 318 General and administrative costs 5 (4 ) (1 ) - 1,084 1,084 Net operating income/(loss) 830 1,745 503 - (1,084 ) 1,994 Depreciation and amortization 889 411 339 - - 1,639 Operating (loss)/income $ (59 ) $ 1,334 $ 164 $ - $ (1,084 ) $ 355 As of September 30, 2018: Total Assets $ 69,098 $ 66,845 $ 37,018 $ - $ 298,128 $ 471,089 For the Three Months Ended September 30, 2017 Retail Multi-Family Industrial Hospitality Unallocated Total Total revenues $ 2,452 2,118 $ 1,581 $ 4,741 $ - $ 10,892 Property operating expenses 905 492 631 3,620 4 5,652 Real estate taxes 361 19 162 60 - 602 General and administrative costs 39 3 6 107 2,019 2,174 Net operating income/(loss) 1,147 1,604 782 954 (2,023 ) 2,464 Depreciation and amortization 1,387 407 458 486 - 2,738 Operating (loss)/income $ (240 ) $ 1,197 $ 324 $ 468 $ (2,023 ) $ (274 ) As of December 31, 2017: Total Assets $ 70,758 $ 67,966 $ 49,461 $ 61,316 $ 270,173 519,674 For the Nine Months Ended September 30, 2018 Retail Multi-Family Industrial Hospitality Unallocated Total Total revenues $ 5,345 6,702 $ 3,981 $ - $ - $ 16,028 Property operating expenses 2,170 1,485 1,350 - - 5,005 Real estate taxes 735 54 494 - - 1,283 General and administrative costs 1 1 (8 ) - 3,297 3,291 Net operating income/(loss) 2,439 5,162 2,145 - (3,297 ) 6,449 Depreciation and amortization 2,756 1,231 1,230 - - 5,217 Operating (loss)/income $ (317 ) $ 3,931 $ 915 $ - $ (3,297 ) $ 1,232 For the Nine Months Ended September 30, 2017 Retail Multi-Family Industrial Hospitality Unallocated Total Total revenues $ 7,805 $ 6,443 $ 4,683 $ 16,161 $ - $ 35,092 Property operating expenses 2,782 1,430 1,679 12,617 5 18,513 Real estate taxes 1,120 55 555 221 - 1,951 General and administrative costs 129 33 (10 ) 225 4,238 4,615 Net operating income/(loss) 3,774 4,925 2,459 3,098 (4,243 ) 10,013 Depreciation and amortization 3,759 1,218 1,339 1,936 - 8,252 Operating income/(loss) $ 15 $ 3,707 $ 1,120 $ 1,162 $ (4,243 ) $ 1,761 |
Organization (Details Textual)
Organization (Details Textual) ft² in Millions | 9 Months Ended |
Sep. 30, 2018ft² | |
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |
Date of incorporation | Jun. 8, 2004 |
Lightstone REIT, partnership formation date | Jul. 12, 2004 |
General partner ownership interest | 98.00% |
Retail [Member] | |
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |
Occupancy Percentage Of Commercial Properties | 83.00% |
Industrial Properties [Member] | |
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |
Occupancy Percentage Of Commercial Properties | 68.00% |
Residential Real Estate [Member] | |
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |
Occupancy Percentage Of Commercial Properties | 97.00% |
Wholly Owned Properties [Member] | Retail [Member] | |
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |
Area of Real Estate Property | 0.5 |
Wholly Owned Properties [Member] | Industrial Properties [Member] | |
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |
Number of Real Estate Properties | 10 |
Area of Real Estate Property | 0.5 |
Wholly Owned Properties [Member] | Residential Real Estate [Member] | |
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |
Number of Units in Real Estate Property | 199 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Dec. 31, 2016 |
Cash and cash equivalents | $ 61,829 | $ 116,434 | $ 127,381 | |
Restricted cash | 9,157 | 2,785 | 4,362 | |
Total cash, cash equivalents and restricted cash | $ 70,986 | $ 119,219 | $ 131,743 | $ 108,357 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Details Textual) $ in Millions | Jan. 02, 2018USD ($) |
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Investment Transferred from Available-for-sale to Equity Method, after Tax | $ 15.5 |
Marketable Securities, Fair V_3
Marketable Securities, Fair Value Measurements and Notes Payable (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2018 | Dec. 31, 2017 | |
Schedule of Available-for-sale Securities [Line Items] | ||
Equity securities, Adjusted Cost | $ 20,632 | $ 20,632 |
Equity securities, Gross Unrealized Gains | 18,072 | 16,971 |
Equity securities, Gross Unrealized Losses | (5) | 0 |
Equity securities, Fair Value | 38,699 | 37,603 |
Debt securities, Adjusted Cost | 82,765 | 20,350 |
Debt securities, Gross Unrealized Gains | 57 | 371 |
Debt securities, Gross Unrealized Losses | (1,355) | (380) |
Debt securities, Fair Value | 81,467 | 20,341 |
Adjusted Cost | 103,397 | 40,982 |
Gross Unrealized Gains | 18,129 | 17,342 |
Gross Unrealized Losses | (1,360) | (380) |
Fair Value | 120,166 | 57,944 |
Equity Securities, primarily REITs [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Equity securities, Adjusted Cost | 1,405 | 1,405 |
Equity securities, Gross Unrealized Gains | 315 | 263 |
Equity securities, Gross Unrealized Losses | (5) | 0 |
Equity securities, Fair Value | 1,715 | 1,668 |
Marco OP Units and Marco II OP Units [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Equity securities, Adjusted Cost | 19,227 | 19,227 |
Equity securities, Gross Unrealized Gains | 17,757 | 16,708 |
Equity securities, Gross Unrealized Losses | 0 | 0 |
Equity securities, Fair Value | 36,984 | 35,935 |
Corporate Bonds and Preferred Securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Debt securities, Adjusted Cost | 81,102 | 18,494 |
Debt securities, Gross Unrealized Gains | 57 | 371 |
Debt securities, Gross Unrealized Losses | (1,055) | (81) |
Debt securities, Fair Value | 80,104 | 18,784 |
Mortgage Backed Securities ("MBS") [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Debt securities, Adjusted Cost | 1,663 | 1,856 |
Debt securities, Gross Unrealized Gains | 0 | 0 |
Debt securities, Gross Unrealized Losses | (300) | (299) |
Debt securities, Fair Value | $ 1,363 | $ 1,557 |
Marketable Securities, Fair V_4
Marketable Securities, Fair Value Measurements and Notes Payable (Details 1) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | $ 120,166 | $ 57,944 |
Equity Securities, primarily REITs [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 1,715 | 1,668 |
Marco OP and Marco OP II Units [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 36,984 | 35,935 |
Corporate Bonds and Preferred Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 80,104 | 18,784 |
MBS [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 1,363 | 1,557 |
Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 1,715 | 1,668 |
Fair Value, Inputs, Level 1 [Member] | Equity Securities, primarily REITs [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 1,715 | 1,668 |
Fair Value, Inputs, Level 1 [Member] | Marco OP and Marco OP II Units [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 0 | 0 |
Fair Value, Inputs, Level 1 [Member] | Corporate Bonds and Preferred Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 0 | 0 |
Fair Value, Inputs, Level 1 [Member] | MBS [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 118,451 | 56,276 |
Fair Value, Inputs, Level 2 [Member] | Equity Securities, primarily REITs [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | Marco OP and Marco OP II Units [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 36,984 | 35,935 |
Fair Value, Inputs, Level 2 [Member] | Corporate Bonds and Preferred Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 80,104 | 18,784 |
Fair Value, Inputs, Level 2 [Member] | MBS [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 1,363 | 1,557 |
Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | Equity Securities, primarily REITs [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | Marco OP and Marco OP II Units [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | Corporate Bonds and Preferred Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | MBS [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | $ 0 | $ 0 |
Marketable Securities, Fair V_5
Marketable Securities, Fair Value Measurements and Notes Payable (Details 2) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Due in 1 year | $ 18,677 | |
Due in 1 year through 5 years | 44,716 | |
Due in 5 years through 10 years | 16,711 | |
Due after 10 years | 1,363 | |
Total | $ 81,467 | $ 20,341 |
Marketable Securities, Fair V_6
Marketable Securities, Fair Value Measurements and Notes Payable (Details Textual) - USD ($) | Jan. 02, 2018 | Sep. 14, 2012 | Sep. 30, 2018 | Dec. 31, 2017 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Debt instrument, interest rate terms | LIBOR + 2.75% | |||
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Investment Transferred from Available-for-sale to Equity Method, after Tax | $ 15,500,000 | |||
Margin Loan [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Debt instrument, interest rate terms | Libor plus 0.85% | |||
Debt instrument, interest rate at end of period | 3.11% | |||
Line of Credit [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Debt instrument, interest rate terms | Libor plus 1.35% | |||
Debt instrument, interest rate at end of period | 3.61% | |||
Debt instrument, maturity date | Jun. 19, 2019 | |||
Line of credit facility, maximum borrowing capacity | $ 25,000,000 | |||
Line of credit facility, amount outstanding | $ 18,600,000 | $ 18,600,000 | ||
Marco OP Units and Pro DFJV Holdings LLC [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Debt Instrument, Collateral Amount | $ 209,000 | |||
Mortgage Backed Securities [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Available for sale securities debt maturity minimum period | 27 years | |||
Available for sale securities debt maturity maximum period | 30 years | |||
Marco Op Units And Op Two Units [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Equity Securities Securities Held During Period | 209,243 | 89,695 |
Mortgages Payable, Net (Details
Mortgages Payable, Net (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2017 | |
Debt Instrument [Line Items] | ||
Amount Due at Maturity | $ 109,453 | |
Secured Debt | $ 117,186 | $ 157,927 |
Debt instrument, interest rate terms | LIBOR + 2.75% | |
Weighted Average Interest Rate | 5.92% | |
Total mortgages payable | $ 118,454 | 159,585 |
Less: Deferred financing costs | (1,268) | (1,658) |
Gulf Coast Industrial Portfolio [Member] | ||
Debt Instrument [Line Items] | ||
Amount Due at Maturity | 30,642 | |
Secured Debt | $ 30,642 | 50,205 |
Interest Rate | 9.83% | |
Weighted Average Interest Rate | 9.83% | |
St Augustine Outlet Center [Member] | ||
Debt Instrument [Line Items] | ||
Amount Due at Maturity | $ 0 | |
Secured Debt | 0 | 20,400 |
Gantry Park [Member] | ||
Debt Instrument [Line Items] | ||
Amount Due at Maturity | 65,317 | |
Secured Debt | $ 73,638 | 74,500 |
Interest Rate | 4.48% | |
Weighted Average Interest Rate | 4.48% | |
Maturity Date | 2024-11 | |
DePaul Plaza [Member] | ||
Debt Instrument [Line Items] | ||
Amount Due at Maturity | $ 13,494 | |
Secured Debt | $ 14,174 | $ 14,480 |
Weighted Average Interest Rate | 4.62% | |
Maturity Date | 2020-06 |
Mortgages Payable, Net (Detai_2
Mortgages Payable, Net (Details 1) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
2,018 | $ 31,041 | |
2,019 | 1,621 | |
2,020 | 14,924 | |
2,021 | 1,328 | |
2,022 | 1,389 | |
Thereafter | 68,151 | |
Total | 118,454 | $ 159,585 |
Less: Deferred financing costs | (1,268) | (1,658) |
Total principal maturities, net | $ 117,186 | $ 157,927 |
Mortgages Payable, Net (Detai_3
Mortgages Payable, Net (Details Textual) - USD ($) $ in Thousands | Jun. 05, 2018 | May 29, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 |
Debt Instrument [Line Items] | |||||||
Debt Instrument Interest London Interbank Offered Rate | 2.26% | 2.26% | 1.57% | ||||
Debt Instrument, Increase, Accrued Interest | $ 300 | $ 800 | $ 1,300 | $ 2,500 | |||
Repayments of Secured Debt | 21,568 | $ 306 | |||||
Proceeds from Sale of Foreclosed Assets | $ 20,700 | ||||||
Secured Debt | 117,186 | 117,186 | $ 157,927 | ||||
Gulf Coast Industrial Portfolio Mortgage [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Proceeds from (Repayments of) Secured Debt | 20,700 | ||||||
Proceeds From Repayment Of Principal Amount Of Secured Debt | 19,600 | ||||||
Proceeds From Repayment Of Interest Amount Of Secured Debt | 1,100 | ||||||
Secured Debt | 30,600 | 30,600 | |||||
St. Augustine Outlet Center [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Secured Debt | 0 | 0 | 20,400 | ||||
St. Augustine Outlet Center [Member] | Mortgage-backed Securities, Issued by Private Enterprises [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Repayments of Secured Debt | $ 20,400 | ||||||
Courtyard - Baton Rouge [Member] | Mortgages payable [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Accrued default interest payable | 12,500 | 12,500 | 11,200 | ||||
Gulf Coast Industrial Portfolio [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Proceeds from Sale of Foreclosed Assets | 20,700 | ||||||
Proceeds from (Repayments of) Secured Debt | 20,700 | ||||||
Proceeds From Repayment Of Principal Amount Of Secured Debt | 19,600 | ||||||
Proceeds From Repayment Of Interest Amount Of Secured Debt | $ 1,100 | ||||||
Secured Debt | $ 30,642 | $ 30,642 | $ 50,205 |
Disposition (Details Textual)
Disposition (Details Textual) - USD ($) $ in Thousands | Jun. 05, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 |
Proceeds from Sale of Foreclosed Assets | $ 20,700 | |||||
Equity Method Investment, Realized Gain (Loss) on Disposal | $ 0 | $ 10,483 | $ 7,137 | $ 10,483 | ||
Real Estate Owned, Transfer to Real Estate Owned | 13,600 | 20,658 | 27,028 | |||
Real Estate Owned, Transfer from Real Estate Owned | 20,700 | $ 13,521 | $ 27,028 | |||
Gulf Coast Industrial Portfolio [Member] | ||||||
Proceeds from Sale of Foreclosed Assets | 20,700 | |||||
Proceeds from (Repayments of) Secured Debt | 20,700 | |||||
Proceeds From Repayment Of Principal Amount Of Secured Debt | 19,600 | |||||
Proceeds From Repayment Of Interest Amount Of Secured Debt | $ 1,100 | |||||
Equity Method Investment, Realized Gain (Loss) on Disposal | $ 7,100 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | ||
Related Party Transaction [Line Items] | |||||
Development fees and leasing commissions | [1] | $ 62 | $ 125 | $ 182 | $ 706 |
Related Party [Member] | |||||
Related Party Transaction [Line Items] | |||||
Total | 574 | 880 | 1,874 | 2,966 | |
Related Party [Member] | Asset Management [Member] | |||||
Related Party Transaction [Line Items] | |||||
Management fees | 392 | 556 | 1,283 | 1,684 | |
Related Party [Member] | Management Service [Member] | |||||
Related Party Transaction [Line Items] | |||||
Management fees | $ 120 | $ 199 | $ 409 | $ 576 | |
[1] | Generally, capitalized and amortized over the estimated useful life of the associated asset. |
Related Party Transactions (D_2
Related Party Transactions (Details 1) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Mar. 31, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | ||
Related Party Transaction [Line Items] | |||||||
Investments in and Advances to Affiliates, at Fair Value, Gross Additions | $ 113,433 | $ 158,314 | |||||
Preferred Stock Dividend Income | $ 3,447 | $ 4,568 | 10,934 | $ 12,909 | |||
Unfunded Investment Contribution Liabilities | 4,067 | 4,067 | |||||
Minimum [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Preferred Stock, Dividend Rate, Percentage | 8.00% | ||||||
Maximum [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Preferred Stock, Dividend Rate, Percentage | 12.00% | ||||||
Forty East End Avenue Preferred Investment [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Investments in and Advances to Affiliates, at Fair Value, Gross Additions | [1] | 30,000 | 30,000 | ||||
Preferred Stock Dividend Income | [1] | 920 | 920 | 2,730 | 2,463 | ||
Unfunded Investment Contribution Liabilities | [1] | 0 | $ 0 | ||||
Forty East End Avenue Preferred Investment [Member] | Minimum [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Preferred Stock, Dividend Rate, Percentage | [1] | 8.00% | |||||
Forty East End Avenue Preferred Investment [Member] | Maximum [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Preferred Stock, Dividend Rate, Percentage | [1] | 12.00% | |||||
Thirty Zero Two Thirty Ninth Avenue One Preferred Investment [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Preferred Stock, Dividend Rate, Percentage | 12.00% | ||||||
Investments in and Advances to Affiliates, at Fair Value, Gross Additions | $ 10,000 | 10,000 | |||||
Preferred Stock Dividend Income | 307 | 307 | 910 | 946 | |||
Unfunded Investment Contribution Liabilities | 0 | $ 0 | |||||
Four Eighty Five Seventh Avenue Preferred Investment [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Preferred Stock, Dividend Rate, Percentage | 12.00% | ||||||
Investments in and Advances to Affiliates, at Fair Value, Gross Additions | $ 0 | 60,000 | |||||
Preferred Stock Dividend Income | 0 | 1,840 | 1,095 | 5,460 | |||
Unfunded Investment Contribution Liabilities | 0 | $ 0 | |||||
East 11th Street [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Preferred Stock, Dividend Rate, Percentage | 12.00% | ||||||
Investments in and Advances to Affiliates, at Fair Value, Gross Additions | $ 57,500 | 46,119 | |||||
Preferred Stock Dividend Income | 1,763 | 1,155 | 4,970 | 3,135 | |||
Unfunded Investment Contribution Liabilities | 0 | $ 0 | |||||
Miami Moxy [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Preferred Stock, Dividend Rate, Percentage | 12.00% | ||||||
Investments in and Advances to Affiliates, at Fair Value, Gross Additions | $ 15,933 | $ 12,195 | |||||
Preferred Stock Dividend Income | 457 | $ 346 | 1,229 | $ 905 | |||
Unfunded Investment Contribution Liabilities | $ 4,067 | $ 4,067 | |||||
[1] | The dividend rate increased from 8% to 12% during March 2017 in connection with the procurement of construction financing on this project. |
Related Party Transactions (D_3
Related Party Transactions (Details Textual) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Sep. 19, 2018 | Mar. 31, 2017 | Sep. 30, 2018 | Sep. 30, 2018 | Dec. 31, 2017 | |
Investments in and Advances to Affiliates [Line Items] | |||||
Unfunded Investment Contribution Liabilities | $ 4,067 | $ 4,067 | |||
Dividends, Cash | 12,809 | ||||
Sale of Stock, Consideration Received on Transaction | 113,400 | $ 158,300 | |||
Preferred Units, Preferred Partners' Capital Accounts | $ 30,000 | $ 30,000 | |||
Lightstone Slp Llc [Member] | |||||
Investments in and Advances to Affiliates [Line Items] | |||||
Equity Method Investment, Ownership Percentage | 10.03% | 10.03% | 19.17% | ||
Sponsor [Member] | |||||
Investments in and Advances to Affiliates [Line Items] | |||||
Sale of Stock, Consideration Received on Transaction | $ 1,500 | ||||
Sale of Stock Percentage of Ownership Transferred | 9.14% | ||||
SLP Units [Member] | |||||
Investments in and Advances to Affiliates [Line Items] | |||||
Dividends, Cash | $ 500 | $ 1,500 | |||
Minimum [Member] | |||||
Investments in and Advances to Affiliates [Line Items] | |||||
Preferred Stock, Dividend Rate, Percentage | 8.00% | ||||
Maximum [Member] | |||||
Investments in and Advances to Affiliates [Line Items] | |||||
Preferred Stock, Dividend Rate, Percentage | 12.00% | ||||
Preferred Investments [Member] | |||||
Investments in and Advances to Affiliates [Line Items] | |||||
Unfunded Investment Contribution Liabilities | 4,100 | 4,100 | |||
Additional Investments In And Advances To Affiliates At Fair Value Gross Additions | 15,100 | ||||
Sale of Stock, Consideration Received on Transaction | 1,400 | $ 1,500 | |||
Four Eighty Five Seventh Avenue Preferred Investment [Member] | |||||
Investments in and Advances to Affiliates [Line Items] | |||||
Unfunded Investment Contribution Liabilities | $ 0 | 0 | |||
Additional Investments In And Advances To Affiliates At Fair Value Gross Additions | $ 60,000 | ||||
Preferred Stock, Dividend Rate, Percentage | 12.00% |
Financial Instruments (Details)
Financial Instruments (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Debt Instrument [Line Items] | ||
Carrying Amount | $ 118,454 | $ 159,585 |
Mortgages payable [Member] | ||
Debt Instrument [Line Items] | ||
Carrying Amount | 118,500 | 159,600 |
Estimated Fair Value | $ 116,700 | $ 158,600 |
Financial Instruments (Details
Financial Instruments (Details Textual) $ in Millions | Sep. 30, 2018USD ($) |
Debt Instrument [Line Items] | |
Notes Payable, Fair Value Disclosure | $ 18.6 |
Segment Information (Details)
Segment Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Segment Reporting Information [Line Items] | |||||
Total revenues | $ 4,996 | $ 10,892 | $ 16,028 | $ 35,092 | |
Property operating expenses | 1,600 | 5,652 | 5,005 | 18,513 | |
Real estate taxes | 318 | 602 | 1,283 | 1,951 | |
General and administrative costs | 1,084 | 2,174 | 3,291 | 4,615 | |
Net operating income/(loss) | 1,994 | 2,464 | 6,449 | 10,013 | |
Depreciation and amortization | 1,639 | 2,738 | 5,217 | 8,252 | |
Operating (loss)/income | 355 | (274) | 1,232 | 1,761 | |
Total Assets | 471,089 | 519,674 | 471,089 | 519,674 | $ 519,674 |
Retail [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total revenues | 1,774 | 2,452 | 5,345 | 7,805 | |
Property operating expenses | 727 | 905 | 2,170 | 2,782 | |
Real estate taxes | 212 | 361 | 735 | 1,120 | |
General and administrative costs | 5 | 39 | 1 | 129 | |
Net operating income/(loss) | 830 | 1,147 | 2,439 | 3,774 | |
Depreciation and amortization | 889 | 1,387 | 2,756 | 3,759 | |
Operating (loss)/income | (59) | (240) | (317) | 15 | |
Total Assets | 69,098 | 70,758 | 69,098 | 70,758 | |
Multi-Family [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total revenues | 2,256 | 2,118 | 6,702 | 6,443 | |
Property operating expenses | 497 | 492 | 1,485 | 1,430 | |
Real estate taxes | 18 | 19 | 54 | 55 | |
General and administrative costs | (4) | 3 | 1 | 33 | |
Net operating income/(loss) | 1,745 | 1,604 | 5,162 | 4,925 | |
Depreciation and amortization | 411 | 407 | 1,231 | 1,218 | |
Operating (loss)/income | 1,334 | 1,197 | 3,931 | 3,707 | |
Total Assets | 66,845 | 67,966 | 66,845 | 67,966 | |
Industrial [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total revenues | 966 | 1,581 | 3,981 | 4,683 | |
Property operating expenses | 376 | 631 | 1,350 | 1,679 | |
Real estate taxes | 88 | 162 | 494 | 555 | |
General and administrative costs | (1) | 6 | (8) | (10) | |
Net operating income/(loss) | 503 | 782 | 2,145 | 2,459 | |
Depreciation and amortization | 339 | 458 | 1,230 | 1,339 | |
Operating (loss)/income | 164 | 324 | 915 | 1,120 | |
Total Assets | 37,018 | 49,461 | 37,018 | 49,461 | |
Hospitality [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total revenues | 0 | 4,741 | 0 | 16,161 | |
Property operating expenses | 0 | 3,620 | 0 | 12,617 | |
Real estate taxes | 0 | 60 | 0 | 221 | |
General and administrative costs | 0 | 107 | 0 | 225 | |
Net operating income/(loss) | 0 | 954 | 0 | 3,098 | |
Depreciation and amortization | 0 | 486 | 0 | 1,936 | |
Operating (loss)/income | 0 | 468 | 0 | 1,162 | |
Total Assets | 0 | 61,316 | 0 | 61,316 | |
Unallocated [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total revenues | 0 | 0 | 0 | 0 | |
Property operating expenses | 0 | 4 | 0 | 5 | |
Real estate taxes | 0 | 0 | 0 | 0 | |
General and administrative costs | 1,084 | 2,019 | 3,297 | 4,238 | |
Net operating income/(loss) | (1,084) | (2,023) | (3,297) | (4,243) | |
Depreciation and amortization | 0 | 0 | 0 | 0 | |
Operating (loss)/income | (1,084) | (2,023) | (3,297) | (4,243) | |
Total Assets | $ 298,128 | $ 270,173 | $ 298,128 | $ 270,173 |
Subsequent Events (Details Text
Subsequent Events (Details Textual) - USD ($) | Nov. 08, 2018 | Oct. 15, 2018 |
Subsequent Event [Line Items] | ||
Distribution Rate Per Day | $ 0.0019178 | |
Number Of Days Used To Calculate Dividend Per Day | 365 days | |
Annualized Distribution Rate | 7.00% | |
Dividends Declared Amount Per Share | $ 10 | |
Subsequent Event [Member] | ||
Subsequent Event [Line Items] | ||
Payments of Dividends | $ 4,200,000 |