Summit Healthcare REIT 10-K 29 Mar 21 2020 FY Annual report Financial data

Document and Entity Information

Document and Entity Information - USD ($)	12 Months Ended
	Dec. 31, 2020	Mar. 15, 2021	Jun. 30, 2020
Cover [Abstract]
Document Type	10-K
Entity Interactive Data Current	Yes
Amendment Flag	false
No Trading Symbol Flag	true
Document Period End Date	Dec. 31, 2020
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	FY
Entity Registrant Name	Summit Healthcare REIT, Inc
Entity Central Index Key	0001310383
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Public Float			$ 0
Entity Common Stock, Shares Outstanding		23,027,978
Entity Shell Company	false
Entity Emerging Growth Company	false
Entity Small Business	true
Title of 12(b) Security	None

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($)	Dec. 31, 2020	Dec. 31, 2019
ASSETS
Cash and cash equivalents	$ 14,658,000	$ 13,260,000
Restricted cash	2,933,000	2,817,000
Real estate properties, net	44,921,000	46,513,000
Notes receivable	262,000	575,000
Tenant and other receivables, net	4,677,000	3,812,000
Deferred leasing commissions, net	536,000	607,000
Other assets, net	1,203,000	594,000
Equity-method investments	11,375,000	13,131,000
Total assets	80,565,000	81,309,000
LIABILITIES AND EQUITY
Accounts payable and accrued liabilities	2,530,000	2,504,000
Security deposits	664,000	664,000
Loans payable, net of debt issuance costs	45,274,000	45,577,000
Total liabilities	48,468,000	48,745,000
Commitments and contingencies (Note 9)
Stockholders' Equity
Preferred stock, $0.001 par value; 10,000,000 shares authorized; no shares issued or outstanding at December 31, 2020 and 2019	0	0
Common stock, $0.001 par value; 290,000,000 shares authorized; 23,027,978 shares issued and outstanding at December 31, 2020 and 2019	23,000	23,000
Additional paid-in capital	116,335,000	116,184,000
Accumulated deficit	(84,456,000)	(83,843,000)
Total stockholders' equity	31,902,000	32,364,000
Noncontrolling interests	195,000	200,000
Total equity	32,097,000	32,564,000
Total liabilities and equity	$ 80,565,000	$ 81,309,000

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Dec. 31, 2020	Dec. 31, 2019
CONSOLIDATED BALANCE SHEETS
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized	290,000,000	290,000,000
Common stock, shares issued	23,027,978	23,027,978
Common stock, shares outstanding	23,027,978	23,027,978

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Revenues:
Total rental revenues	$ 6,448,000	$ 6,862,000
Acquisition and asset management fees	1,312,000	1,174,000
Interest income from notes receivable	27,000	29,000
Total operating revenue	7,787,000	8,065,000
Expenses:
Property operating costs	947,000	862,000
General and administrative	4,063,000	4,476,000
Depreciation and amortization	1,667,000	1,750,000
Total operating expenses	6,677,000	7,088,000
Other operating income:
Gain on sale of real estate properties	0	4,274,000
Operating income	1,110,000	5,251,000
Income from equity-method investees	555,000	184,000
Other income	58,000	207,000
Interest expense	(2,280,000)	(2,612,000)
Net (loss) income	(557,000)	3,030,000
Noncontrolling interests' share in net (income) loss	(56,000)	83,000
Net (loss) income applicable to common stockholders	$ (613,000)	$ 3,113,000
Basic:
(Loss) income from continuing operations	$ (0.03)	$ 0.14
Net (loss) income applicable to common stockholders	(0.03)	0.14
Diluted:
(Loss) income from continuing operations	(0.03)	0.13
Net (loss) income applicable to common stockholders	$ (0.03)	$ 0.13
Weighted average shares used to calculate earnings per common share:
Basic	23,027,978	23,027,978
Diluted	23,027,978	23,506,478

CONSOLIDATED STATEMENTS OF EQUI

CONSOLIDATED STATEMENTS OF EQUITY - USD ($)	Common Stock	Additional Paid-in Capital	Accumulated Deficit	Total Stockholders' Equity	Noncontrolling Interests	Total
Balance at Dec. 31, 2018	$ 23,000	$ 115,950,000	$ (86,956,000)	$ 29,017,000	$ 349,000	$ 29,366,000
Balance (in shares) at Dec. 31, 2018	23,027,978
Stock-based compensation	$ 0	234,000	0	234,000	0	234,000
Distributions paid to noncontrolling interests	0	0	0	0	(66,000)	(66,000)
Net (loss) income	0	0	3,113,000	3,113,000	(83,000)	3,030,000
Balance at Dec. 31, 2019	$ 23,000	116,184,000	(83,843,000)	32,364,000	200,000	32,564,000
Balance (in shares) at Dec. 31, 2019	23,027,978
Stock-based compensation	$ 0	151,000	0	151,000	0	151,000
Distributions paid to noncontrolling interests	0	0	0	0	(61,000)	(61,000)
Net (loss) income	0	0	(613,000)	(613,000)	56,000	(557,000)
Balance at Dec. 31, 2020	$ 23,000	$ 116,335,000	$ (84,456,000)	$ 31,902,000	$ 195,000	$ 32,097,000
Balance (in shares) at Dec. 31, 2020	23,027,978

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Cash flows from operating activities:
Net (loss) income	$ (557,000)	$ 3,030,000
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Amortization of debt issuance costs	90,000	134,000
Depreciation and amortization	1,667,000	1,750,000
Straight-line rents	(227,000)	(357,000)
Write-off of debt issuance costs	77,000	0
Stock-based compensation expense	151,000	234,000
Gain on sale of real estate properties	0	(4,274,000)
Income from equity-method investees	(555,000)	(184,000)
Change in operating assets and liabilities:
Tenant and other receivables, net	700,000	332,000
Other assets	(703,000)	(91,000)
Accounts payable and accrued liabilities	117,000	261,000
Net cash provided by operating activities	760,000	835,000
Cash flows from investing activities:
Proceeds from sale of real estate properties, net of transaction costs	0	24,852,000
Issuance of notes receivable	0	(253,000)
Investments in equity-method investees	0	(5,060,000)
Distributions received from equity-method investees	972,000	1,224,000
Payments from notes receivable	313,000	408,000
Net cash provided by investing activities	1,285,000	21,171,000
Cash flows from financing activities:
Proceeds from issuance loans payable	11,863,000	3,872,000
Payments of loans payable	(11,677,000)	(22,982,000)
Distributions paid	0	(1,499,000)
Distributions paid to noncontrolling interests	(61,000)	(66,000)
Debt issuance costs	(656,000)	(210,000)
Net cash used in financing activities	(531,000)	(20,885,000)
Net increase in cash, cash equivalents and restricted cash	1,514,000	1,121,000
Cash, cash equivalents and restricted cash - beginning of year	16,077,000	14,956,000
Cash, cash equivalents and restricted cash - end of year	17,591,000	16,077,000
Supplemental disclosure of cash flow information:
Cash paid for interest:	$ 1,828,000	$ 2,289,000

Organization

Organization	12 Months Ended
	Dec. 31, 2020
Organization
Organization	1. Organization Summit Healthcare REIT, Inc. (“Summit”) is a real estate investment trust that owns 100% of three properties, 95.3% of four properties, a 10% equity interest in an unconsolidated equity-method investment that holds 17 properties, a 35% equity interest in an unconsolidated equity-method investment that holds two properties, a 20% equity interest in an unconsolidated equity-method investment that holds two properties, a 10% equity interest in an unconsolidated equity-method investment that holds nine properties, a 10% equity interest in an unconsolidated equity-method investment that holds six properties and a 15% equity interest in an unconsolidated equity-method investment that holds 14 properties. Summit is a Maryland corporation, formed in 2004 under the General Corporation Law of Maryland for the purpose of investing in and owning real estate. As used in these notes, the “Company”, “we”, “us” and “our” refer to Summit and its consolidated subsidiaries, including Summit Healthcare Operating Partnership, L.P. (the “Operating Partnership”), except where the context otherwise requires. We conduct substantially all of our operations through the Operating Partnership, which is a Delaware limited partnership. We own a 99.88% general partner interest in the Operating Partnership, and Cornerstone Realty Advisors, LLC (“CRA”), a former affiliate, owns a 0.12% limited partnership interest. Summit and the Operating Partnership are managed and operated as one entity, and Summit has no significant assets other than its investment in the Operating Partnership. Summit, as the general partner of the Operating Partnership, controls the Operating Partnership and consolidates the assets, liabilities, and results of operations of the Operating Partnership. Therefore, the assets and liabilities of Summit and the Operating Partnership are the same . Cornerstone Healthcare Partners LLC We own 95% of Cornerstone Healthcare Partners LLC (“CHP LLC”), which was formed in 2012, and the remaining 5% noncontrolling interest is owned by Cornerstone Healthcare Real Estate Fund, Inc. (“CHREF”), an affiliate of CRA. CHP LLC is consolidated within our financial statements and owns four properties (the “JV Properties”) with another partially owned subsidiary. As of December 31, 2020, we own a 95.3% interest in the four JV Properties, and CHREF owns a 4.7% interest. See Note 11 for the disposition of real estate properties which includes one of the JV Properties. Summit Union Life Holdings, LLC – Equity-Method Investment In April, 2015, through our Operating Partnership, we entered into a limited liability company agreement with Best Years, LLC (“Best Years”), an unrelated entity and a U.S.-based affiliate of Union Life Insurance Co, Ltd. (a Chinese corporation), and formed Summit Union Life Holdings, LLC (the “SUL JV”). The SUL JV is not consolidated in our consolidated financial statements and is accounted for under the equity-method in our consolidated financial statements (see Note 5). As of December 31, 2020 and 2019, we have a 10% interest in the SUL JV which owns 17 properties. Summit Fantasia Holdings, LLC – Equity-Method Investment In September 2016, through our Operating Partnership, we entered into a limited liability company agreement with Fantasia Investment III LLC (“Fantasia”), an unrelated entity and a U.S.-based affiliate of Fantasia Holdings Group Co., Limited (a Chinese corporation listed on the Stock Exchange of Hong Kong (HKEX)), and formed Summit Fantasia Holdings, LLC (the “Fantasia JV”). The Fantasia JV is not consolidated in our consolidated financial statements and is accounted for under the equity-method in our consolidated financial statements. As of December 31, 2020 and 2019, we have a 35% interest in the Fantasia JV which owns two properties. Summit Fantasia Holdings II, LLC – Equity-Method Investment In December 2016, through our Operating Partnership, we entered into a limited liability company agreement with Fantasia, and formed Summit Fantasia Holdings II, LLC (the “Fantasia II JV”). The Fantasia II JV is not consolidated in our consolidated financial statements and is accounted for under the equity-method in our consolidated financial statements. As of December 31, 2020 and 2019, we have a 20% interest in the Fantasia II JV which owns two properties. Summit Fantasia Holdings III, LLC - Equity-Method Investment In July 2017, through our Operating Partnership, we entered into a limited liability company agreement with Fantasia and formed Summit Fantasia Holdings III, LLC (the “Fantasia III JV”). The Fantasia III JV is not consolidated in our consolidated financial statements and is accounted for under the equity-method in the Company’s consolidated financial statements. As of December 31, 2020 and 2019, we have a 10% interest in the Fantasia III JV which owns nine properties. Summit Fantasy Pearl Holdings, LLC – Equity-Method Investment In October 2017, through our Operating Partnership, we entered into a limited liability company agreement with Fantasia, Atlantis Senior Living 9, LLC, a Delaware limited liability company (“Atlantis”), and Fantasy Pearl LLC, a Delaware limited liability company (“Fantasy”), and formed Summit Fantasy Pearl Holdings, LLC (the “FPH JV”). The FPH JV is not consolidated in our consolidated financial statements and is accounted for under the equity-method in the Company’s consolidated financial statements. As of December 31, 2020 and 2019, we have a 10% interest in the FPH JV which owns six properties. Indiana JV– Equity-Method Investment In February 2019, through our wholly-owned subsidiary, Summit Indiana, LLC, we formed a new joint venture, a Delaware limited liability company (the “Indiana JV”). On March 13, 2019, we entered into a Limited Liability Company Agreement (the “Indiana JV Agreement”) with two unrelated parties: a real estate holding company and a global institutional asset management firm, both Delaware limited liability companies. The Indiana JV is not consolidated in our consolidated financial statements and is accounted for under the equity-method. As of December 31, 2020 and 2019, we have a 15% interest in the Indiana JV which owns 14 properties. Summit Healthcare Asset Management, LLC (TRS) Summit Healthcare Asset Management, LLC (“SAM TRS”) is our wholly-owned taxable REIT subsidiary (“TRS”). We serve as the manager of the SUL JV, Fantasia JV, Fantasia II JV, Fantasia III JV and FPH JV (collectively, our “Equity-Method Investments”), and provide management services in exchange for fees and reimbursements. All acquisition fees and asset management fees earned by us are paid to SAM TRS and expenses incurred by us, as the manager, are reimbursed from SAM TRS. See Notes 5 and 7 for further information.

Summary of Significant Accounti

Summary of Significant Accounting Policies	12 Months Ended
	Dec. 31, 2020
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies	2. Summary of Significant Accounting Policies The summary of significant accounting policies presented below is designed to assist in understanding our consolidated financial statements. Such consolidated financial statements and accompanying notes are the representations of our management, which is responsible for their integrity and objectivity. These accounting policies conform to accounting principles generally accepted in the United States of America, or GAAP, in all material respects, and have been consistently applied in preparing the accompanying consolidated financial statements. Principles of Consolidation and Basis of Presentation The consolidated financial statements include the accounts of the Company, its wholly-owned subsidiaries, All intercompany accounts and transactions have been eliminated in consolidation. The Financial Accounting Standards Board (“FASB”) issued Accounting Standard Codification (“ASC”) 810, Consolidation , which addresses how a business enterprise should evaluate whether it has a controlling interest in an entity through means other than voting rights and accordingly should consolidate the entity. Before concluding that it is appropriate to apply the voting interest consolidation model to an entity, an enterprise must first determine that the entity is not a variable interest entity. We evaluate, as appropriate, our interests, if any, in joint ventures and other arrangements to determine if consolidation is appropriate. Use of Estimates The preparation of our consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. We base these estimates on various assumptions that we believe to be reasonable under the circumstances, and these estimates form the basis for our judgments concerning the carrying values of assets and liabilities that are not readily apparent from other sources. We periodically evaluate these estimates and judgments based on available information and experience. Actual results could differ from our estimates under different assumptions and conditions. If actual results significantly differ from our estimates, our financial condition and results of operations could be materially impacted. Cash and Cash Equivalents We consider all short-term, highly liquid investments that are readily convertible to cash with a maturity of three months or less at the time of purchase to be cash equivalents. As of December 31, 2020, we had cash accounts in excess of FDIC-insured limits. We do not believe we are exposed to any significant credit risk on cash and cash equivalents. Restricted Cash The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown on the consolidated statements of cash flows: December 31, December 31, 2020 2019 Cash and cash equivalents $ 14,658,000 $ 13,260,000 Restricted cash 2,933,000 2,817,000 Total cash, cash equivalents, and restricted cash shown on the consolidated statements of cash flows $ 17,591,000 $ 16,077,000 Investments in Real Estate and Depreciation We allocate the purchase price of our properties in accordance with ASC 805 – Business Combinations . If the acquisition does not meet the definition of a business, we record the acquisition as an asset acquisition. For transactions that are business combinations, acquisition costs are expensed as incurred. For transactions that are an asset acquisition, acquisition costs are capitalized as incurred. Upon an asset acquisition of a property, we allocate the purchase price of the property based upon the relative fair value of the tangible and intangible assets acquired and liabilities assumed, which generally consists of land, buildings, site improvements, and furniture and fixtures. We allocate the purchase price to tangible assets of an acquired property by valuing the property as if it were vacant. We are required to make subjective assessments as to the estimated useful lives of our depreciable assets. We consider the period of future benefit of the assets to determine the appropriate estimated useful lives. Depreciation of our assets is being charged to expense on a straight-line basis over the estimated useful lives. We depreciate the fair value allocated to building and improvements over estimated useful lives ranging from 15 to 39 years. We estimate the value of furniture and fixtures based on the assets’ depreciated replacement cost. We depreciate the fair value allocated to furniture and fixtures over estimated useful lives ranging from three to six years. Assets held for sale are not depreciated. Impairment of Real Estate Properties We evaluate the recoverability of the carrying value of our real estate properties on a property-by-property basis. We review our properties for recoverability when events or circumstances, including significant physical changes in the property, significant adverse changes in general economic conditions and significant deteriorations of the underlying cash flows of the property, indicate that the carrying amount of the property may not be fully recoverable. A long-lived asset is impaired when management's estimate of current and projected, undiscounted and unleveraged, operating cash flows of the property is less than the net carrying value of the property. In determining these cash flows, the Company estimates holding periods, market comparable, capitalization rates, future occupancy levels, rental rates, and other relevant inputs. If recognition of an impairment charge is necessary, it is measured as the amount by which the carrying amount of the property exceeds the fair value of the property. We recorded no impairment charges in 2020 and 2019. Fair Value Measurements Fair value represents the estimate of the proceeds to be received, or paid in the case of a liability, in a current transaction between willing parties. ASC 820, Fair Value Measurement, establishes a fair value hierarchy to categorize the inputs used in valuation techniques to measure fair value. Inputs are either observable or unobservable in the marketplace. Observable inputs are based on market data from independent sources and unobservable inputs reflect the reporting entity’s assumptions about market participant assumptions used to value an asset or liability. Financial assets and liabilities are categorized based on the inputs to the valuation techniques as follows: Level 1. Quoted prices in active markets for identical instruments. Level 2. Observable inputs other than Level 1 prices, 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. Assets and liabilities measured at fair value are classified according to the lowest level input that is significant to their valuation. A financial instrument that has a significant unobservable input along with significant observable inputs may still be classified as a Level 3 instrument. We generally determine or calculate the fair value of financial instruments using quoted market prices in active markets when such information is available or use appropriate present value or other valuation techniques, such as discounted cash flow analyses, incorporating available market discount rate information for similar types of instruments and our estimates for non-performance and liquidity risk. These techniques are significantly affected by the assumptions used, including the discount rate, credit spreads, and estimates of future cash flow. There were no assets or liabilities measured at fair value on a nonrecurring basis during the year ended December 31, 2020. Fair Value Measurement of Financial Instruments Our consolidated balance sheets include the following financial instruments: cash and cash equivalents, restricted cash, notes receivable, deposits, tenant and other receivables, certain other assets, accounts payable and accrued liabilities, security deposits and loans payable. With the exception of the loans payable discussed below, we consider the carrying values to approximate fair value for such financial instruments because of the short period of time between origination of the instruments and their expected payment. As of December 31, 2020 and 2019, the fair value of loans payable was $52.6 million and $47.4 million, compared to the principal balance (excluding debt discount) of $47.2 million and $47.0 million, respectively. The fair value of loans payable was estimated using lending rates available to us for financial instruments with similar terms and maturities. To estimate fair value as of December 31, 2020, we utilized discount rates ranging from 2.8% to 4.2% and a weighted average discount rate of 2.8%. As the inputs to our valuation estimate are neither observable in nor supported by market activity, our loans payable are classified as Level 3 liabilities within the fair value hierarchy. At December 31, 2020 and 2019, we do not have any significant financial assets or financial liabilities that are measured at fair value on a recurring basis in our consolidated financial statements. Variable Interest Entities We analyze our contractual and/or other interests to determine whether such interests constitute an interest in a VIE in accordance with ASC 810, Consolidation, and, if so, whether we are the primary beneficiary. If we are determined to be the primary beneficiary of a VIE, we must consolidate the VIE. A VIE is broadly defined as an entity with one or more of the following characteristics: (a) the total equity investment at risk is insufficient to finance the entity’s activities without additional subordinated financial support; (b) as a group, the holders of the equity investment at risk lack (i) the ability to make decisions about the entity’s activities through voting or similar rights, (ii) the obligation to absorb the expected losses of the entity, or (iii) the right to receive the expected residual returns of the entity; and (c) the equity investors have voting rights that are not proportional to their economic interests, and substantially all of the entity’s activities either involve, or are conducted on behalf of, an investor that has disproportionately few voting rights. In determining whether we are the primary beneficiary, we consider, among other things, whether we have the power to direct the activities of the VIE that most significantly impact the entity’s economic performance, including, but not limited to, determining or limiting the scope or purpose of the VIE, selling or transferring property owned or controlled by the VIE, or arranging financing for the VIE. We also consider whether we have the obligation to absorb losses of the VIE or the right to receive benefits from the VIE. We evaluated our wholly and partially owned subsidiaries, CHP, LLC and equity method investments to determine if they are a VIE, and if such VIE should be consolidated. CHP, LLC is consolidated as the Company is deemed the primary beneficiary. Our Operating Partnership’s equity investment in SUL JV, Fantasia JV, Fantasia II JV, Fantasia III JV, FPH JV and Indiana JV met the definition and criteria of VIEs. However, as we do not have power to direct the activities that most significantly impact economic performance of these VIEs, they are accounted for under the equity method of accounting and are reflected as Equity-method investment. Tenant and Other Receivables Tenant and other receivables are comprised of rental and tenant reimbursement billings due from tenants, the cumulative amount of future adjustments necessary to present rental income on a straight-line basis, asset management fees and distributions receivable. Tenant receivables for rental revenues are recorded at the original amount earned. Allowance for Credit Losses The allowance for credit losses is maintained on all receivables except for lease receivables and is maintained at a level believed adequate to absorb potential losses in our receivables. The determination of the credit allowance is based on a quarterly evaluation of each of these receivables, including general economic conditions and estimated collectability. We evaluate the collectability of our receivables based on a combination of credit quality indicators, including, but not limited to, payment status, historical charge-offs, and financial strength of the lessee or equity method investment. A receivable is considered to have deteriorated in credit quality when, based on current information and events, it is probable that we will be unable to collect all amounts due. As of December 31, 2020, the allowance for credit losses is immaterial. Deferred Financing Costs Costs incurred with potential financing arrangements are recorded as deferred debt issuance costs. Costs incurred in connection with completed debt financing are recorded as debt issuance costs. Debt issuance costs are amortized using the straight-line basis which approximates the effective interest rate method, over the contractual terms of the respective financings, and are presented net of loans payable in loans payable, net of debt issuance costs, in the consolidated balance sheets. Deferred Leasing Commissions Leasing commissions (paid to CRA prior to April 1, 2014) were capitalized at cost and are being amortized on a straight-line basis over the related lease term. As of December 31, 2020 and 2019, total costs incurred were $1.1 million, and the unamortized balance was approximately $0.5 million and $0.6 million, respectively. Amortization expense for the years ended December 31, 2020 and 2019 was approximately $70,000 and $51,000, respectively. Other Assets Other assets consist primarily of deferred financing and acquisition costs, prepaid insurance, property taxes and other. Additionally, other assets will be amortized to expense over their future service periods. Balances without future economic benefit are expensed as they are identified. Equity-Method Investments We report our investments in unconsolidated entities, over whose operating and financial policies we have the ability to exercise significant influence but not control, under the equity method of accounting. Under this method of accounting, our pro rata share of the applicable entity’s earnings or losses is included in our consolidated statements of operations. We initially record our investments based on either the carrying value for properties contributed or the cash invested. We evaluate our equity-method investments for impairment whenever events or changes in circumstances indicate that the carrying value of our investments may exceed the fair value. If it is determined that a decline in the fair value of our investments is not temporary, and if such reduced fair value is below its carrying value, an impairment is recorded. Determining fair value involves significant judgment. Our estimates consider available evidence including the present value of the expected future cash flows discounted at market rates, general economic conditions and other relevant factors. We did not record any impairments related to our equity-method investments for the years ended December 31, 2020 and 2019. Rental Revenue On January 1, 2019, the Company adopted the FASB Accounting Standards Update (“ASU”) 2016-02, Leases (“Topic 842”), using the modified retrospective approach and have elected the package of practical expedients permitted under the transition guidance within the new standard, which, among other things, permits us to carry forward our prior conclusions for lease classification, the ability not to reassess whether any existing or expired contracts contain leases, lease classifications for existing or expired leases, and initial direct costs on existing leases. We also made an accounting policy election to keep short-term leases less than twelve months off the balance sheet for all classes of underlying assets. The new standard requires a lessor to classify leases as either sales-types, finance or operating leases. A lease will be treated as a sales-type lease if it transfers all of the risks and rewards, as well as control of the underlying asset, to the lessee. If risks and rewards are conveyed without the transfer of control, the lease is treated as a financing lease. If the lessor does not convey risks and rewards or control, an operating lease results. After evaluating our tenant leases, we have concluded that these are operating-type leases. Additionally, lessors were provided with the option to elect a practical expedient, which we elected, allowing them to not separate lease and nonlease components in a contract for the purpose of revenue recognition and disclosure. This practical expedient is limited to circumstances in which: (i) the timing and pattern of transfer are the same for the nonlease component and the related lease component and (ii) the lease component, if accounted for separately, would be classified as an operating lease. This practical expedient causes an entity to assess whether a contract is predominantly lease or service based and recognize the entire contract under the relevant accounting guidance (i.e., predominantly lease-based would be accounted for under ASU 2016-02 and predominantly service-based would be accounted for ASC 606). The FASB also issued ASU 2019-20 “Leases (Topic 842) - Narrow Improvements for Lessors,” which provided lessors the ability to make an accounting policy election not to evaluate whether certain sales taxes and other similar taxes imposed by a governmental authority on a specific lease revenue producing transaction are the primary obligation of the lessor as owner of the underlying leased asset. A lessor that makes this election will exclude these taxes from the measurement of lease revenue and the associated expense. Upon adoption of ASC 842, we utilized this practical expedient in cases where real estate taxes were paid directly by our tenants to taxing authorities. For triple-net leasing arrangements in which the tenant remits payment for real estate taxes to us and we pay the taxing authority, we have included the associated revenue and expense in total rental revenues and property operating costs on the consolidated statements of operations. This reporting had no impact on our net income. Additionally, under Topic 842, we must assess if all payments due under the lease are likely to be collected. If tenant lease payments are not likely to be collected, then the revenues will be recognized on a cash basis (or if the answer changes at a later date, the revenues are adjusted to reflect what it would have been on a cash basis) and the adjustments will be recorded through rental revenues, rather than bad debt expense. We did not have any collectability issues for the year ended December 31, 2020. Acquisition and Asset Management Fees The Company records acquisition and asset management fee revenue based on ASC 606, Revenue from Contracts with Customers (Topic 606) . Acquisition fees arise from contractual agreements with our joint venture partners and are earned and paid at the time we close an acquisition, therefore, satisfying our performance obligations at that time. We earn our asset management fees based on a percentage of the purchase price or equity raised. As the manager, our duty is to manage the day-to-day operations of the special-purpose entities which own the properties. Asset management fees are recognized as a single performance obligation (managing the properties) comprised of a series of distinct services (handling issues with our tenants, etc.). We believe that the overall service of asset management is substantially the same each day and has the same pattern of performance over the term of the agreement. As a result, each day of service represents a performance obligation satisfied at that point in time. These fees are recognized at the end of each period for services performed during that period, billed monthly and paid quarterly. Stock-Based Compensation We record stock-based compensation expense for share-based payments to employees and directors, including grants of stock options based on the estimated fair value of the options on the date of grant using the Black-Scholes option-pricing model. Compensation expense is recognized ratably over the vesting term and is included in general and administrative expense in our consolidated statements of operations. Forfeitures are recognized as they occur. See Note 10 for further information. Noncontrolling Interest in Consolidated Subsidiary Noncontrolling interest relates to the interest in the consolidated entities that are not wholly-owned by us. As of December 31, 2020 and 2019, the noncontrolling interest mainly relates to CHP, LLC. ASC 810‑10‑65, Consolidation , clarifies that a noncontrolling interest in a subsidiary is an ownership interest in the consolidated entity that should be reported as equity in the consolidated financial statements. ASC 810‑10‑65 also requires consolidated net income to be reported at amounts that include the amounts attributable to both the parent and the noncontrolling interest and requires disclosure, on the face of the consolidated statements of operations, of the amounts of consolidated net income attributable to the parent and to the noncontrolling interest. We periodically evaluate individual noncontrolling interests for the ability to continue to recognize the noncontrolling interest as permanent equity in the consolidated balance sheets. Any noncontrolling interest that fails to qualify as permanent equity will be reclassified as temporary equity and adjusted to the greater of (a) the carrying amount, or (b) its redemption value as of the end of the period in which the determination is made. Income Taxes We have elected to be taxed as a REIT, under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”) beginning with our taxable year ending December 31, 2006. To qualify as a REIT, we must meet certain organizational and operational requirements, including a requirement to currently distribute at least 90% of the REIT’s ordinary taxable income to stockholders. As a REIT, we generally will not be subject to federal income tax on taxable income that we distribute to our stockholders. If we fail to qualify as a REIT in any taxable year, we will then be subject to federal income taxes on our taxable income at regular corporate rates and will not be permitted to qualify for treatment as a REIT for federal income tax purposes for four years following the year during which qualification is lost unless the Internal Revenue Service were to grant us relief under certain statutory provisions. Such an event could materially and adversely affect our net income and net cash available for distribution to stockholders. However, we believe that we will be organized and operate in such a manner as to qualify for treatment as a REIT and intend to operate for the foreseeable future in such a manner so that we will remain qualified as a REIT for federal income tax purposes. Given the applicable statute of limitations, we generally are subject to audit by the Internal Revenue Service (“IRS”) for the year ended December 31, 2016 and subsequent years, and state income tax returns are subject to audit for the year ended December 31, 2015 and subsequent years. We have elected to treat SAM TRS as a taxable REIT subsidiary, which generally may engage in any business, including the provision of customary or non-customary services for our tenants. SAM TRS is treated as a regular corporation and is subject to federal income tax and applicable state income and franchise taxes at regular corporate rates. SAM TRS has deferred tax assets related to their NOL (which expires in or after 2035 for federal and state) for a total of $1,493,000, which has a full valuation allowance as of December 31, 2020 and 2019. Due to the losses incurred and the full valuation allowance on deferred tax assets, there was no tax provision related to SAM TRS in 2020 and 2019. Uncertain Tax Positions In accordance with the requirements of ASC 740, Income Taxes, favorable tax positions are included in the calculation of tax liabilities if it is more likely than not that our adopted tax position will prevail if challenged by tax authorities. As a result of our REIT status, we are able to claim a dividends-paid deduction on our tax return to deduct the full amount of common dividends paid to stockholders when computing our annual taxable income, which results in our taxable income being passed through to our stockholders. A REIT is subject to a 100% tax on the net income from prohibited transactions. A “prohibited transaction” is the sale or other disposition of property held primarily for sale to customers in the ordinary course of a trade or business. There is a safe harbor provision which, if met, expressly prevents the Internal Revenue Service from asserting the prohibited transaction test. We have no income tax expense, deferred tax assets or deferred tax liabilities associated with any such uncertain tax positions for the operations of any entity included in the consolidated results of operations. We classify interest and penalties related to uncertain tax positions, if any, in our consolidated financial statements as a component of general and administrative expense. Basic and Diluted Net Income (Loss) and Distributions per Common Share Basic earnings per share is computed by dividing net income (loss) by the weighted-average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing net income (loss) by the weighted-average number of common shares and dilutive potential common shares outstanding during the period. Dilutive potential common shares are calculated in accordance with the treasury stock method, which assumes that proceeds from the exercise of all stock options are used to repurchase common stock at our NAV value. See Note 12 for further information. Lake Forest Lease We have entered into a lease agreement, as amended, for corporate office space located in Lake Forest, California, which expires in April 2022 (the “LF Lease”). In 2019, based on Topic 842, we recorded a right-of-use asset and lease liability equal to the present value of the remaining lease payments within the consolidated balance sheet. As a result, the Company recognized a right-of-use asset (“ROU”) of $0.3 million and a lease liability of $0.3 million on its consolidated balance sheet as of January 1, 2019. As of December 31, 2020 and 2019, the Company had a ROU operating lease asset of $0.1 million and $0.2 million, respectively, recorded in other assets in our consolidated balance sheets and a lease liability of $0.1 million and $0.2 million, respectively, recorded in our consolidated balance sheets in accrued liabilities. The Company recognized lease expense, calculated as the remaining cost of the lease allocated over the remaining lease term on a straight-line basis. Lease expense is presented as part of continuing operations within general and administrative expenses in the consolidated statements of operations. For the years ended December 31, 2020 and 2019, the Company recognized approximately $0.1 million in lease expense. For the years ended December 31, 2020 and 2019, the Company paid $100,000 in rent relating to the LF Lease. As a payment arising from an operating lease, the $0.1 million is classified within operating activities in the consolidated statements of cash flows. As of December 31, 2020, the remaining lease term for LF Lease is 16 months. Because we do not have access to the discount rate implicit in the lease, we have utilized our estimated incremental borrowing rate as the discount rate. The estimated discount rate associated with our corporate operating lease is 5%. Pursuant to ASC 842, lease payments on the LF Lease for each of the following years ending December 31 are as follows: Year Lease payments 2021 $ 108,000 2022 36,000 Total lease payments $ 144,000 Less effect of discounting (5,000) Total lease liability $ 139,000 Recently Issued Accounting Pronouncements In January 2020, the FASB issued ASU 2020-01 (“Update”) to clarify the interaction among the accounting standards for equity securities, equity method investments and certain derivatives. The new ASU clarifies that a company should consider observable transactions that require a company to either apply or discontinue the equity method of accounting under Topic 323, Investments—Equity Method and Joint Ventures, for the purposes of applying the measurement alternative in accordance with Topic 321 immediately before applying or upon discontinuing the equity method. For public business entities, the amendments in this update are effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. The Company believes the implementation of the new standard will not have a material effect on its financial position, results of operations, and cash flows. Recently Adopted Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). ASU 2016-13 requires that a financial asset (or a group of financial assets) measured at amortized cost basis be presented at the net amount expected to be collected. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial asset(s) to present the net carrying value at the amount expected to be collected on the financial asset. The amendments in ASU 2016-13 are an improvement because they eliminate the probable initial recognition threshold under current GAAP and, instead, reflect an entity’s current estimate of all expected credit losses. Previously, when credit losses were measured under GAAP, an entity generally only considered past events and current conditions in measuring the incurred loss. In November 2018, the FASB issued ASU 2018-19, Codification Improvements to Topic 326, Financial Instruments—Credit Losses (“ASU 2018-19”), which amends ASU 2016-13 to clarify that receivables arising from operating leases are not within the scope of Subtopic 326-20, and instead, impairment of such receivables should be accounted for in accordance with ASU 2016-02, Leases, as amended by subsequent ASUs (“Topic 842”). In November 2019, the FASB issued ASU 2019-11, Codification Improvements to Topic 326, Financial Instruments—Credit Losses (“ASU 2019-11”), which amends ASU 2016-13 to clarify or address stakeholders’ specific issues about certain aspects of ASU 2016-13. ASU 2016-13, ASU 2018-19 and ASU 2019-11 are effective for fiscal years and interim periods within those years beginning after December 15, 2019, with early adoption permitted as of the fiscal years beginning after December 15, 2018. The Company adopted ASU 2016-13, ASU 2018-19 and ASU 2019-11 (collectively, “Topic 326”) on January 1, 2020. The adoption of the new standard on January 1, 2020 did not have a material effect on the Company’s financial position, results of operations, or cash flows. Coronavirus (COVID-19) Since first being reported in December 2019, COVID-19 has spread globally, including to every state in the United States and more than 200 countries. On March 11, 2020, the World Health Organization declared COVID-19 a pandemic, and on March 13, 2020, the United States declared a national emergency with respect to COVID-19. The outbreak has led governments and other authorities around the world, including federal, state and local authorities in the United States, to impose measures intended to control its spread, including restrictions on freedom of movement and business operations such as travel bans, border closings, business closures, quarantines and shelter-in-place orders. The COVID-19 pandemic and measures to prevent its spread negatively impacted senior housing and skilled nursing facilities in a number of ways, including but not limited to: · Decreased occupancy and increased operating costs for the Company’s tenants and borrowers, which may adversely impact their ability to make full and timely rental and debt payments to the Company. As of and for the year ended De

Investments in Real Estate Prop

Investments in Real Estate Properties	12 Months Ended
	Dec. 31, 2020
Investments in Real Estate Properties
Investments in Real Estate Properties	3. Investments in Real Estate Properties As of December 31, 2020 and 2019, investments in real estate properties including those held by our consolidated subsidiaries (excluding the 50 properties owned by our unconsolidated Equity-Method Investments) are set forth below: 2020 2019 Land $ 6,237,000 $ 6,237,000 Buildings and improvements 48,295,000 48,295,000 Less: accumulated depreciation (9,853,000) (8,444,000) Buildings and improvements, net 38,442,000 39,851,000 Furniture and fixtures 4,230,000 4,230,000 Less: accumulated depreciation (3,988,000) (3,805,000) Furniture and fixtures, net 242,000 425,000 Real estate properties, net $ 44,921,000 $ 46,513,000 Depreciation expense (excluding leasing commission amortization) for the years ended December 31, 2020 and 2019 was approximately $1.6 million and $1.7 million, respectively. As of December 31, 2020, our portfolio consisted of seven real estate properties which were 100% leased to the tenants of the related facilities. See Note 11 for further information regarding the February 2019 disposition of our four properties located in North Carolina. On October 7, 2020, a receiver assumed the responsibilities of operating and managing the healthcare facility (the “Pennington Gardens Facility”) owned by our wholly owned subsidiary Summit Chandler, LLC (“Summit Chandler”) in Chandler, Arizona. The following table provides summary information regarding our portfolio (excluding the 50 properties owned by our unconsolidated Equity-Method Investments) as of December 31, 2020: Loans Payable, Excluding Debt Purchase Issuance Property Location Date Purchased Type (1) Price Costs Sheridan Care Center Sheridan, OR August 3, 2012 SNF $ 4,100,000 $ 4,330,000 Fernhill Care Center Portland, OR August 3, 2012 SNF 4,500,000 3,798,000 Friendship Haven Healthcare and Rehabilitation Center Galveston County, TX September 14, 2012 SNF 15,000,000 11,746,000 Pacific Health and Rehabilitation Center Tigard, OR December 24, 2012 SNF 8,140,000 6,332,000 Brookstone of Aledo Aledo, IL July 2, 2013 AL 8,625,000 6,859,000 Sundial Assisted Living Redding, CA December 18, 2013 AL 3,500,000 3,792,000 Pennington Gardens Chandler, AZ July 17, 2017 AL/MC 13,400,000 10,330,000 Total: $ 57,265,000 $ 47,187,000 (1) SNF is an abbreviation for skilled nursing facility. AL is an abbreviation for assisted living facility. MC is an abbreviation for memory care facility. Future Minimum Lease Payments The future minimum lease payments to be received under existing operating leases for our consolidated properties as of December 31, 2020 are as follows: Years ending December 31, 2021 5,547,000 2022 5,662,000 2023 5,778,000 2024 5,441,000 2025 5,549,000 Thereafter 23,341,000 $ 51,318,000 2020 Acquisitions None. 2019 Acquisitions None.

Loans Payable

Loans Payable	12 Months Ended
	Dec. 31, 2020
Loans Payable
Loans Payable	4. Loans Payable As of December 31, 2020 and 2019, loans payable consisted of the following: December 31, 2020 December 31, 2019 Loan payable to CIBC Bank USA refinanced in April 2020 and as of December 31, 2019, collateralized by Friendship Haven. $ — $ 10,725,000 Loan payable to Capital One Multifamily Finance, LLC (insured by HUD) in monthly installments of approximately $49,000, including interest at a fixed rate of 4.23%, due in September 2053, and collateralized by Pennington Gardens. $ 10,330,000 $ 10,473,000 Loans payable to Lument (formerly ORIX Real Estate Capital, LLC) (insured by HUD) in monthly installments of approximately $183,000, including interest, ranging from a fixed rate of 2.79% to 4.2%, due in September 2039 through April 2055, and as of December 31, 2020, collateralized by Sheridan, Fernhill, Pacific Health, Aledo, Sundial Assisted Living and Friendship Haven. As of December 31, 2019, collateralized by Sheridan, Fernhill, Pacific Health, Aledo and Sundial Assisted Living. $ 36,857,000 $ 25,804,000 47,187,000 47,002,000 Less debt issuance costs (1,913,000) (1,425,000) Total loans payable $ 45,274,000 $ 45,577,000 As of December 31, 2020, we have total debt obligations of approximately $47.2 million that will mature between 2039 and 2055. See Note 3 for loans payable balance for each property. All of the loans payable have certain financial and non-financial covenants, including ratios and financial statement considerations. As of December 31, 2020, we were in compliance with all of our debt covenants. In connection with our loans payable, we incurred debt issuance costs. As of December 31, 2020 and 2019, the unamortized balance of the debt issuance costs was approximately $1.9 million and $1.4 million, respectively. These debt issuance costs are being amortized over the life of their respective financing agreements using the straight-line basis which approximates the effective interest rate method. For the years ended December 31, 2020 and 2019, approximately $0.2 million and $0.1 million, respectively, of debt issuance costs were amortized and included in interest expense in our consolidated statements of operations. During the years ended December 31, 2020 and 2019, we incurred approximately $2.1 million and $2.5 million, respectively, of interest expense related (excluding debt issuance cost amortization) to our loans payable. The principal payments due on the loans payable (excluding debt issuance costs) for each of the five following years and thereafter ending December 31 are as follows: Principal Year Amount 2021 1,076,000 2022 1,116,000 2023 1,158,000 2024 1,201,000 2025 1,246,000 Thereafter 41,390,000 $ 47,187,000 The following information notes the loan activity for the years ended December 31, 2020 and 2019: CIBC Bank USA In March 2019, CHP Friendswood SNF, LLC entered into a $10,725,000, three-year term loan and security agreement with CIBC Bank USA, which was collateralized by the Friendship Haven facility. On April 23, 2020, we refinanced the existing CIBC loan with a Lument Capital (“Lument”) HUD-insured loan. See below under Lument for further information . Lument Capital (formerly ORIX Real Estate Capital, LLC) We have several properties with HUD-insured loans from Lument (formerly ORIX). See table above listing loans payable for further information. On April 23, 2020, we refinanced our outstanding $10,725,000 loan payable for CHP Friendswood, LLC with a HUD-insured loan through Lument Capital. The loan bears interest at a fixed rate of 2.79%, plus 0.65% for mortgage insurance premiums for the term of the loan and is collateralized by Friendship Haven. The loan matures in April 2055 and amortizes over 35 years. The loan proceeds of approximately $11.9 million were used to pay down the outstanding loan balance of approximately $10.8 million to CIBC, to fund certain HUD reserves and to pay debt issuance costs of approximately $0.7 million. The note contains a prepayment penalty of 10% in year 1, which reduces each year by 100 basis points, until there is no longer a prepayment penalty beginning in year 11. In April 2019, we entered into the HUD Redding Loan, which is collateralized by the Sundial Assisted Living facility. The loan bears interest at a fixed rate of 4.2%, plus 0.65% for mortgage insurance premiums, for the term of the loan. The loan matures in April 2054 and amortizes over 35 years. We incurred approximately $210,000 in debt issuance costs. The note contains a prepayment penalty of 10% in year 1, which reduces each year by 100 basis points, until there is no longer a prepayment penalty beginning in year 11. All of the HUD-insured loans are subject to customary representations, warranties and ongoing covenants and agreements with respect to the operation of the facilities, including the provision for certain maintenance and other reserve accounts for property tax, insurance, and capital expenditures, with respect to the facilities all as described in the HUD agreements. These reserves are included in restricted cash in our consolidated balance sheets.

Equity-Method Investments

Equity-Method Investments	12 Months Ended
	Dec. 31, 2020
Equity-Method Investments
Equity-Method Investments	5. Equity-Method Investments As of December 31, 2020 and 2019, the balances of our Equity-Method Investments were approximately $11.4 million and $13.1 million, respectively, and are as follows: Summit Union Life Holdings, LLC The SUL JV will exist until an event of dissolution occurs, as defined in the limited liability company agreement of the SUL JV (the “SUL LLC Agreement”). Under the SUL LLC Agreement, net operating cash flow of the SUL JV will be distributed monthly, first to the Operating Partnership and Best Years pari passu up to a 9% to 10% annual return, as defined, and thereafter to Best Years 75% and the Operating Partnership 25%. All capital proceeds from the sale of the properties held by the SUL JV, a refinancing or another capital event will be paid first to the Operating Partnership and Best Years pari passu until each has received an amount equal to its accrued but unpaid 9% to 10% return plus its total contribution, and thereafter to Best Years 75% and the Operating Partnership 25%. In April 2015, the Operating Partnership recorded a receivable for approximately $362,000 for distributions that could not be paid prior to the contribution of the original six properties contributed in April 2015 (“JV 2 Properties”) due to cash restrictions related to the loans payable for the contributed JV 2 Properties. In 2017, we received approximately $178,000 to pay down the distribution receivable from two of the JV 2 properties. In 2020, we received approximately $173,000 to pay down the distribution receivable from three of the JV 2 properties. As of December 31, 2020 and 2019, the receivable of $11,000 and $184,000, respectively, due from the JV 2 properties is included in tenant and other receivables on our consolidated balance sheets. As of December 31, 2020 and 2019, the balance of our equity-method investment related to the SUL JV was approximately $2.7 million and $3.1 million, respectively. Summit Fantasia Holdings, LLC The Fantasia JV will exist until an event of dissolution occurs, as defined in the limited liability company agreement of the Fantasia JV (the “Fantasia LLC Agreement”). Under the Fantasia LLC Agreement, as amended in April 2018, net operating cash flow of the Fantasia JV will be distributed quarterly, first to the Operating Partnership and Fantasia pari passu until each member has received an amount equal to its accrued, but unpaid 8% return, and thereafter 50% to Fantasia and 50% to the Operating Partnership. All capital proceeds from the sale of the properties held by the Fantasia JV, a refinancing or another capital event, will be paid first to the Operating Partnership and Fantasia pari passu until each has received an amount equal to its accrued but unpaid 8% return plus its total capital contribution, and thereafter 50% to Fantasia and 50% to the Operating Partnership. As of December 31, 2020 and 2019, the balance of our equity-method investment related to the Fantasia JV was approximately $2.0 million and $2.1 million, respectively. Summit Fantasia Holdings II, LLC The Fantasia II JV will exist until an event of dissolution occurs, as defined in the limited liability company agreement of the Fantasia II JV (the “Fantasia II LLC Agreement”). Under the Fantasia II LLC Agreement, net operating cash flow of the Fantasia JV will be distributed quarterly, first to the Operating Partnership and Fantasia pari passu until each member has received an amount equal to its accrued, but unpaid 8% return, and thereafter 70% to Fantasia and 30% to the Operating Partnership. All capital proceeds from the sale of the properties held by the Fantasia II JV, a refinancing or another capital event, will be paid first to the Operating Partnership and Fantasia pari passu until each has received an amount equal to its accrued but unpaid 8% return plus its total capital contribution, and thereafter 70% to Fantasia and 30% to the Operating Partnership. As of December 31, 2020 and 2019, the balance of our equity-method investment related to the Fantasia II JV was approximately $1.4 million and $1.5 million, respectively. Summit Fantasia Holdings III, LLC The Fantasia III JV will continue until an event of dissolution occurs, as defined in the limited liability company agreement of the Fantasia III JV (the “Fantasia III LLC Agreement”). Under the Fantasia III LLC Agreement, net operating cash flow of the Fantasia III JV will be distributed quarterly, first to the Operating Partnership and Fantasia pari passu until each member has received an amount equal to its accrued, but unpaid 9% return, and thereafter 75% to Fantasia and 25% to the Operating Partnership. All capital proceeds from the sale of the properties held by the Fantasia III JV, a refinancing or another capital event, will be paid first to the Operating Partnership and Fantasia pari passu until each has received an amount equal to its accrued but unpaid 9% return plus its total capital contribution, and thereafter 75% to Fantasia and 25% to the Operating Partnership. As of December 31, 2020 and 2019, the balance of our equity-method investment related to the Fantasia III JV was approximately $1.6 million and $1.6 million, respectively. Summit Fantasy Pearl Holdings, LLC The FPH JV will continue until an event of dissolution occurs, as defined in the limited liability company agreement of the FPH JV (the “FPH LLC Agreement”). Under the FPH LLC Agreement, net operating cash flow of the FPH JV will be distributed quarterly, first to the members pari passu until each member has received an amount equal to its accrued, but unpaid 9% return, and thereafter 65.25% to Fantasy, 7.5% to Atlantis, 7.25% to Fantasia and 20% to the Operating Partnership. All capital proceeds from the sale of the properties held by the FPH JV, a refinancing or another capital event, will be paid to the members pari passu until each has received an amount equal to its accrued but unpaid 9% return plus its total capital contribution, and thereafter 65.25% to Fantasy, 7.5% to Atlantis, 7.25% to Fantasia, and 20% to the Operating Partnership. As of December 31, 2020 and 2019, the balance of our equity-method investment related to the FPH JV was approximately $0.2 million and $0.5 million, respectively. Indiana JV On February 28, 2019 we formed a new joint venture (“Indiana JV”), and on March 13, 2019, we entered into a Limited Liability Company Agreement (“Indiana JV Agreement”) through our wholly-owned subsidiary, Summit Indiana, LLC, with two unrelated parties: a real estate holding company and a global institutional asset management firm, both Delaware limited liability companies. We have a 15% membership interest in the Indiana JV. On March 13, 2019, through the Indiana JV, we acquired a 15% interest in 14 skilled nursing facilities, located in Indiana. Indiana JV paid a total aggregate purchase price of approximately $128.7 million for the properties, which was funded through capital contributions from the members of the Indiana JV plus the proceeds from a collateralized loan. The facilities are operated by and leased to an affiliate of the real estate holding company. The Indiana JV will continue until an event of dissolution occurs, as defined in the Indiana JV Agreement. Under the Indiana JV Agreement, net operating cash flow of the Indiana JV will be distributed monthly to the members pari passu in accordance with their respective capital percentages, and thereafter as defined in the Indiana JV Agreement. As of December 31, 2020 and 2019, the balance of our equity-method investment related to the Indiana JV was approximately $3.5 million and $4.3 million, respectively. Summarized Financial Data for Equity-Method Investments Our Equity-Method Investments are significant equity-method investments in the aggregate. The results of operations of our Equity-Method Investments for the years ending December 31, 2020 are summarized below: Fantasia Fantasia Fantasia FPH Combined SUL JV JV II JV III JV JV Indiana JV Total Revenue $ 18,247,000 $ 4,112,000 $ 3,557,000 $ 7,982,000 $ 3,537,000 $ 11,786,000 $ 49,221,000 Income from Operations $ 7,831,000 $ 557,000 $ 1,960,000 $ 4,132,000 $ 1,681,000 $ 7,447,000 $ 23,608,000 Net Income $ 3,465,000 $ (55,000) $ 992,000 $ 1,795,000 $ (779,000) $ (479,000) $ 4,939,000 Summit interest in Equity-Method Investments net income $ 346,000 $ (19,000) $ 198,000 $ 179,000 $ (78,000) $ (71,000) $ 555,000 The results of operations of our Equity-Method Investments for the year ending December 31, 2019 are summarized below: Fantasia Fantasia Fantasia FPH Combined SUL JV JV II JV III JV JV Indiana JV Total Revenue $ 18,295,000 $ 3,271,000 $ 3,536,000 $ 7,914,000 $ 3,564,000 $ 9,464,000 $ 46,044,000 Income from Operations $ 7,851,000 $ 824,000 $ 1,912,000 $ 4,135,000 $ 1,677,000 $ 6,042,000 $ 22,441,000 Net Income $ 1,284,000 $ (315,000) $ 923,000 $ 1,302,000 $ (723,000) $ (516,000) $ 1,955,000 Summit interest in Equity-Method Investments net income $ 128,000 $ (110,000) $ 185,000 $ 130,000 $ (72,000) $ (77,000) $ 184,000 Distributions from Equity-Method Investments As of December 31, 2020 and 2019, we have distributions receivable, which is included in tenant and other receivables in our consolidated balance sheets, as follows: December 31, December 31, 2020 2019 SULH JV $ 466,000 $ 97,000 Fantasia JV 36,000 180,000 Fantasia II JV 51,000 48,000 Fantasia III JV 257,000 117,000 FPH JV 26,000 39,000 Indiana JV 498,000 162,000 Total $ 1,334,000 $ 643,000 For the years ended December 31, 2020 and 2019, we received cash distributions, which are included in our cash flows from operating activities in the change in tenant and other receivables, and cash flows from investing activities, using the cumulative earnings approach, as follows: Year Ended December 31, 2020 Year Ended December 31, 2019 Total Cash Cash Flow Cash Flow Total Cash Cash Flow Cash Flow Distributions from from Distributions from from Received Operating Investing Received Operating Investing SUL JV $ 499,000 $ 346,000 $ 153,000 $ 548,000 $ 128,000 $ 420,000 Fantasia JV 144,000 — 144,000 — — — Fantasia II JV 292,000 198,000 94,000 276,000 185,000 91,000 Fantasia III JV 104,000 104,000 — 160,000 130,000 30,000 FPH JV 152,000 — 152,000 306,000 — 306,000 Indiana JV 429,000 — 429,000 377,000 — 377,000 Total $ 1,620,000 $ 648,000 $ 972,000 $ 1,667,000 $ 443,000 $ 1,224,000 Acquisition and Asset Management Fees We serve as the manager of our Equity-Method Investments and provide management services in exchange for fees and reimbursements. As the manager, we are paid an acquisition fee, as defined in the agreements. Additionally, we are paid an annual asset management fee for managing the properties held by our Equity-Method Investments, as defined in the agreements. For the years ended December 31, 2020 and 2019, we recorded approximately $1.3 million and $1.2 million, respectively, in acquisition and asset management fees from our Equity-Method Investments.

Receivables

Receivables	12 Months Ended
	Dec. 31, 2020
Receivables
Receivables	6. Receivables Notes Receivable Friendswood TRS Note The Operating Partnership entered into an amended and restated promissory note dated January 1, 2018, with Friendswood TRS for approximately $1.1 million. The note does not bear interest and is due in 48 equal payments of approximately $22,000. We recorded a discount of approximately $95,000 on the note using an imputed interest rate of 4.25%. As of December 31, 2020 and 2019, the balance on the note was approximately $0.2 million and $0.5 million, respectively. Tenant and Other Receivables, net Tenant and other receivables, net consists of: December 31, December 31, 2020 2019 Straight-line rent receivables $ 2,772,000 $ 2,546,000 Distribution receivables from Equity-Method Investments 1,334,000 643,000 Receivable from JV 2 properties 11,000 184,000 Asset management fees 432,000 430,000 Other receivables 128,000 9,000 Total $ 4,677,000 $ 3,812,000

Related Party Transactions

Related Party Transactions	12 Months Ended
	Dec. 31, 2020
Related Party Transactions
Related Party Transactions	7. Related Party Transactions CRA Prior to the termination of our advisory agreement on April 1, 2014 with CRA (our former advisor, a related party), we incurred costs related to fees paid and costs reimbursed for services rendered to us by CRA through March 31, 2014. Some of the fees we had paid to CRA were considered to be in excess of allowed amounts and, therefore, CRA was required to reimburse us for the amount of the excess costs we paid to them. As of December 31, 2020 and 2019, the receivables from CRA are fully reserved due to the uncertainty of collectability and are included in tenant and other receivables in our consolidated balance sheets (see Note 9). As of December 31, 2020 and 2019, we had the following receivables and reserves: Receivables Reserves Balance Organizational and offering costs $ 738,000 $ (738,000) $ — Asset management fees and expenses 32,000 (32,000) — Operating expenses (direct and indirect) 189,000 (189,000) — Operating expenses (2%/25% Test) 1,717,000 (1,717,000) — Total $ 2,676,000 $ (2,676,000) $ — Equity-Method Investments See Notes 5 and 6 for further discussion of distributions and acquisition and asset management fees related to our Equity-Method Investments.

Concentration of Risk

Concentration of Risk	12 Months Ended
	Dec. 31, 2020
Concentration of Risk
Concentration of Risk	8. Concentration of Risk As of December 31, 2020, we owned one property in California, three properties in Oregon, one property in Texas, one property in Illinois, and one property in Arizona (excluding the 50 properties held by our Equity-Method Investments). Accordingly, there is a geographic concentration of risk subject to economic conditions in certain states. Additionally, as of December 31, 2020, we leased our seven real estate properties to five different tenants under long-term triple net leases. For the year ended December 31, 2020, four of the five tenants each had rental revenue greater than 10% (35%, 24%, 20% and 15%). As of December 31, 2020, we did not have any tenants that constituted a significant asset concentration as none of the net assets of the tenants were greater than 20% of our total assets. As of December 31, 2019, we leased our seven real estate properties to five different tenants under long-term triple net leases. For the year ended December 31, 2019, four of the five tenants each had rental revenue greater than 10% (32%, 22%, 18% and 14%). As of December 31, 2019, we had one tenant that constituted a significant asset concentration as the net assets of the tenants were approximately 20% of our total assets.

Commitments and Contingencies

Commitments and Contingencies	12 Months Ended
	Dec. 31, 2020
Commitments and Contingencies
Commitments and Contingencies	9. Commitments and Contingencies We inspect our properties under a Phase I assessment for the presence of hazardous or toxic substances. While there can be no assurance that a material environmental liability does not exist, we are not currently aware of any environmental liability with respect to the properties that would have a material effect on our consolidated financial condition, results of operations and cash flows. Further, we are not aware of any environmental liability or any unasserted claim or assessment with respect to an environmental liability that we believe would require additional disclosure or the recording of a loss contingency. Our commitments and contingencies include the usual obligations of real estate owners and licensed operators in the normal course of business. In the opinion of management, these matters are not expected to have a material impact on our consolidated financial condition, results of operations and cash flows. We are also subject to contingent losses resulting from litigation against the Company. On April 1, 2014, CRA and Cornerstone Ventures, Inc. filed a complaint in the Superior Court of California for the County of Orange-Central Justice Center, Case No. 30-2014-00714004-CU-BT-CJC, naming the Company, its former directors, one of its officers and one of its former officers as defendants, seeking declaratory and injunctive relief and compensatory and punitive damages. On September 17, 2014, we filed a First Amended Cross-Complaint seeking compensatory damages and an accounting pursuant to Sections 10(c)(i) and 17(c)(ii) of the Advisory Agreement and including any monies Plaintiffs and Terry Roussel directly or indirectly received from or paid to the Company. On February 22, 2018, the action was assigned to a different trial judge. On May 29, 2018, the Company filed a motion for terminating and monetary sanctions against CRA, Cornerstone Ventures, Inc. and their counsel, Winget Spadafora & Schwartzberg. On November 30, 2018, the new trial judge vacated the trial date, pending resolution of the Company’s motion for terminating and monetary sanctions against CRA and Cornerstone Ventures, Inc. and denied the Company’s motion for sanctions against Winget Spadafora & Schwartzberg. On February 13, 2019, the trial judge held another hearing on the Company’s motion for terminating and monetary sanctions and indicated that it intended to grant the Company’s motion for terminating sanctions and award the Company monetary sanctions. On March 14, 2019, the Court entered an Order and Judgment granting the Company’s motion for terminating sanctions, awarding the Company monetary sanctions in the amount of $588,672, and dismissing CRA and Cornerstone Ventures Inc.’s Complaint with prejudice. On May 21, 2019, CRA and Cornerstone Ventures, Inc. filed a notice of appeal from the Judgment and, on June 3, 2019, the Company filed a notice of cross-appeal from the Judgment. On July 9, 2019, the California Court of Appeal, Fourth District dismissed CRA and Cornerstone Ventures, Inc.’s appeal with prejudice. The briefing to the Court of Appeal, Fourth District on the Company’s appeals against CRA, Cornerstone Ventures, Inc and Winget Spadafora & Schwartzberg was completed on April 27, 2020. On October 28, 2020, the Court of Appeal issued an opinion affirming in part, and reversing, in part, the trial court’s opinion and remanded the action back to the trial court. On February 11, 2021, the trial court issued an order awarding an additional $189,645 in monetary sanctions for the period prior to July 12, 2016 in favor of the Company and against CRA and CVI. In September 2015, a bankruptcy petition was filed against Healthcare Real Estate Partners, LLC (“HCRE”) by the investors in Healthcare Real Estate Fund, LLC and Healthcare Real Estate Qualified Purchasers Fund, LLC (collectively, the “Funds”). HCRE did not timely respond to the involuntary petition and the Bankruptcy Court entered an Order of Relief making HCRE a debtor in bankruptcy. As a result, HCRE was removed as manager under the Funds’ operating agreement. Thereafter the Company became the manager of the Funds and purchased the investors’ interests in the Funds for approximately $0.9 million. Following the subsequent dismissal of the involuntary bankruptcy petition filed against it, HCRE filed a motion for attorneys’ fees and damages and a separate complaint for violation of the automatic stay against the petitioning creditors and the Company in the United States Bankruptcy Court of the District of Delaware. The Bankruptcy Court granted a motion to dismiss the complaint for violation of the automatic stay filed jointly by the petitioning creditors and us, and dismissed the complaint with prejudice. HCRE appealed the Bankruptcy Court’s decision to the United States District Court for the District of Delaware which affirmed the Bankruptcy Court’s dismissal of the complaint in a decision dated September 9, 2018. On October 11, 2018, HCRE appealed the District Court’s decision affirming the Bankruptcy Court’s dismissal of the complaint to the United States Court of Appeals for the Third Circuit. On October 22, 2019, the Third Circuit granted HCRE’s appeal, reversing the District Court and holding that HCRE could assert the adversary complaint seeking damages for violation of the automatic stay. The Company filed a Petition for Rehearing on November 5, 2019 asserting that HCRE is not entitled to assert a claim for damages for violation of the automatic stay. This Petition was denied and the mandate was issued sending the matter back to the Bankruptcy Court. The Bankruptcy Court held a status conference on February 4, 2021, and the parties are discussing entry of a scheduling order to govern discovery and pretrial matters, and are also considering whether to explore settlement options. We believe that all of HCRE’s remaining alleged claims are without merit and will vigorously defend ourselves. Indemnification and Employment Agreements We have entered into indemnification agreements with certain of our executive officers and directors which indemnify them against all judgments, penalties, fines and amounts paid in settlement and all expenses actually and reasonably incurred by him or her in connection with any proceeding. Additionally, effective October 1, 2018, we amended our employment agreements with our executive officers to extend the term of each agreement for an additional three years. These employment agreements include customary terms relating to salary, bonus, position, duties and benefits (including eligibility for equity compensation), as well as a cash payment following a change in control of the Company, as defined in such agreements. Management of our Equity-Method Investments As the manager of our Equity-Method Investments, we are responsible for managing the day-to-day operations. Additionally, we could be subject to a capital call from our Equity-Method Investments.

Equity

Equity	12 Months Ended
	Dec. 31, 2020
Equity
Equity	10. Equity Common Stock Our articles of incorporation authorize 290,000,000 shares of common stock with a par value of $0.001 and 10,000,000 shares of preferred stock with a par value of $0.001. Distributions The Company declared no cash distributions per common share during the years ended December 31, 2020 and 2019. Our distribution reinvestment plan was suspended indefinitely effective December 31, 2010. At this time, we cannot provide any assurance as to if or when we will resume our distribution reinvestment plan. Share-Based Compensation Plans Upon the grant of stock options, we determine the exercise price by using our estimated per-share value, which is calculated by aggregating the estimated fair value of our investments in real estate and the estimated fair value of our other assets, subtracting the book value of our liabilities, utilizing a discount for the fact that the shares are not currently traded on a national securities exchange and a lack of a control premium, and divided the total by the number of our common shares outstanding at the time the options were granted. The fair value of each grant is estimated on the date of grant using the Black-Scholes option-pricing model. Assumptions required by the model include the risk-free interest rate, the expected life of the options, the expected stock price volatility over the expected life of the options, and the expected distribution yield. Compensation expense for employee stock options is recognized ratably over the vesting term. The expected life of the options was based on the simplified method as we do not have sufficient historical exercise data. The risk-free interest rate was based on the U.S. Treasury yield curve at the date of grant using the expected life of the options at the date of grant. Volatility was based on historical volatility of the stock prices for a sample of publicly traded companies with risk profiles similar to ours. The valuation model applied in this calculation utilizes highly subjective assumptions that could potentially change over time, including the expected stock price volatility and the expected life of an option. Summit Healthcare REIT, Inc. 2015 Omnibus Incentive Plan On October 28, 2015, we adopted the Summit Healthcare REIT, Inc. 2015 Omnibus Incentive Plan (“Incentive Plan”). The purpose of the Incentive Plan is to provide a means through which to attract and retain key personnel and to provide a means whereby current or prospective directors, officers, employees, consultants and advisors can acquire and maintain an equity interest in us, or be paid incentive compensation, including incentive compensation measured by reference to the value of our common stock, thereby strengthening their commitment to our welfare and aligning their interests with those of our stockholders. We may grant non-qualified stock options and incentive stock options, stock appreciation rights, restricted stock and restricted stock units, and performance based compensation awards. Stock options granted under the Incentive Plan are required to have a per share exercise price that is not less than 100% of the fair market value of our common stock underlying such stock options on the date an option is granted (other than in the case of options that are substitute awards). All stock options that are intended to qualify as incentive stock options must be granted pursuant to an award agreement expressly stating that the option is intended to qualify as an incentive stock option, and will be subject to the terms and conditions that comply with the rules as may be prescribed by Section 422 of the Code. The maximum term for stock options granted under the Incentive Plan will be ten years from the initial date of grant. The Incentive Plan provides that the total number of shares of common stock that may be issued is 3,000,000, of which 1,128,092 is available for future issuances as of December 31, 2020. On January 1, 2020, the Compensation Committee of the Board of Directors approved the issuance of 45,000 stock options under our Summit Healthcare REIT, Inc. 2015 Omnibus Incentive Plan (“Incentive Plan”) to our non-executive employees. The stock options vest monthly beginning on February 1, 2020 and continuing over a three-year period through January 1, 2023. The options expire 10 years from the grant date. The estimated fair value using the Black-Scholes option-pricing model with the following weighted average assumptions: 2020 Stock options granted 45,000 Expected volatility 22.31 % Expected term years Risk-free interest rate % Dividend yield % Fair value per stock option $ The following table summarizes our stock options as of December 31, 2020: Weighted Weighted Average Average Remaining Aggregate Exercise Contractual Intrinsic Options Price Term Value Options outstanding at January 1, 2020 1,826,908 $ 2.09 Granted 45,000 2.26 Exercised — Cancelled/forfeited — Options outstanding at December 31, 2020 1,871,908 $ 2.09 6.81 $ 1,524,000 Options exercisable at December 31, 2020 1,729,876 $ 2.07 6.69 $ 1,433,000 For our outstanding non-vested options as of December 31, 2020, the weighted average grant date fair value per share was $0.58. As of December 31, 2020, we have unrecognized stock-based compensation expense related to unvested stock options which is expected to be recognized as follows: Years Ending December 31, 2021 66,000 2022 15,000 2023 1,000 $ 82,000 The stock-based compensation expense reported for the years ended December 31, 2020 and 2019 was approximately $151,000 and $234,000, respectively, and is included in general and administrative expense in the consolidated statements of operations.

Dispositions

Dispositions	12 Months Ended
	Dec. 31, 2020
Dispositions
Dispositions	11. Dispositions In accordance with ASC 360, Property, Plant & Equipment , we report results of operations from real estate assets that meet the definition of a component of an entity that have been sold, or meet the criteria to be classified as held for sale, as discontinued operations. Sale of Four North Carolina Properties On February 14, 2019, our wholly-owned subsidiaries HP Shelby, LLC, HP Hamlet, LLC, HP Carteret, LLC, and our 95%-owned subsidiary, HP Winston-Salem, LLC, pursuant to a Purchase and Sale Agreement (the “Agreement”) with Agemark Acquisition, LLC (the “Purchaser”), sold to the Purchaser (the “Sale”) the following four properties located in North Carolina (“NC Properties”): The Shelby House, an assisted living facility located in Shelby, North Carolina; The Hamlet House, an assisted living facility located in Hamlet, North Carolina, The Carteret House, an assisted living facility located in Newport, North Carolina and Danby House, an assisted living and memory care facility located in Winston-Salem, North Carolina. The total consideration received by the Company and its subsidiaries pursuant to the Agreement was $27.0 million in cash. The Company incurred approximately $1.2 million is transaction costs, mainly for the prepayment penalty related to the HUD-insured loans (the “HUD Loans”). On the date of the Sale, the total assets of the NC Properties were approximately $22.1 million, and liabilities were approximately $19.5 million, including approximately $19.4 million of outstanding principal to the HUD Loans. The HUD Loans were paid off in full using the proceeds of the Sale. As a result of the Sale, as of February 15, 2019, the NC Properties are no longer included in our consolidated financial statements. For the year ended December 31, 2019, we recorded a gain of approximately $4.3 million on the sale of the NC Properties.

Earnings Per Share

Earnings Per Share	12 Months Ended
	Dec. 31, 2020
Earnings Per Share
Earnings Per Share	12. Earnings Per Share The following table presents the calculation of basic and diluted earnings per share (“EPS”) for the Company’s common stock for the years ended December 31, 2020 and 2019, and reconciles the weighted-average common shares outstanding used in the calculation of basic EPS to the weighted-average common shares outstanding used in the calculation of diluted EPS: 2020 2019 Numerator: (Loss) income from continuing operations $ (557,000) $ 3,030,000 (Loss) income from continuing operations attributable to noncontrolling interest (56,000) 83,000 Net (loss) income applicable to common stockholders $ (613,000) $ 3,113,000 Denominator: Basic: Denominator for basic EPS - weighted average shares 23,027,978 23,027,978 Effect of dilutive shares: Stock options — 478,500 Denominator for diluted EPS – adjusted weighted average shares 23,027,978 23,506,478 Basic EPS $ (0.03) $ 0.14 Diluted EPS $ (0.03) $ 0.13

Segment Reporting

Segment Reporting	12 Months Ended
	Dec. 31, 2020
Segment Reporting
Segment Reporting	13. Segment Reporting ASC 280, Segment Reporting , establishes standards for reporting financial and descriptive information about an enterprise’s reportable segments. As of December 31, 2020 and 2019, we operate in one reportable segment: healthcare real estate and although our portfolio is located throughout the United States, we do not distinguish or group our operations on a geographical basis for purposes of allocating resources or measuring performance. We are managed as one segment, rather than multiple segments for internal purposes and for internal decision making.

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	12 Months Ended
	Dec. 31, 2020
Summary of Significant Accounting Policies
Principles of Consolidation and Basis of Presentation	Principles of Consolidation and Basis of Presentation The consolidated financial statements include the accounts of the Company, its wholly-owned subsidiaries, All intercompany accounts and transactions have been eliminated in consolidation. The Financial Accounting Standards Board (“FASB”) issued Accounting Standard Codification (“ASC”) 810, Consolidation , which addresses how a business enterprise should evaluate whether it has a controlling interest in an entity through means other than voting rights and accordingly should consolidate the entity. Before concluding that it is appropriate to apply the voting interest consolidation model to an entity, an enterprise must first determine that the entity is not a variable interest entity. We evaluate, as appropriate, our interests, if any, in joint ventures and other arrangements to determine if consolidation is appropriate.
Use of Estimates	Use of Estimates The preparation of our consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. We base these estimates on various assumptions that we believe to be reasonable under the circumstances, and these estimates form the basis for our judgments concerning the carrying values of assets and liabilities that are not readily apparent from other sources. We periodically evaluate these estimates and judgments based on available information and experience. Actual results could differ from our estimates under different assumptions and conditions. If actual results significantly differ from our estimates, our financial condition and results of operations could be materially impacted.
Cash and Cash Equivalents	Cash and Cash Equivalents We consider all short-term, highly liquid investments that are readily convertible to cash with a maturity of three months or less at the time of purchase to be cash equivalents. As of December 31, 2020, we had cash accounts in excess of FDIC-insured limits. We do not believe we are exposed to any significant credit risk on cash and cash equivalents.
Restricted Cash	Restricted Cash The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown on the consolidated statements of cash flows: December 31, December 31, 2020 2019 Cash and cash equivalents $ 14,658,000 $ 13,260,000 Restricted cash 2,933,000 2,817,000 Total cash, cash equivalents, and restricted cash shown on the consolidated statements of cash flows $ 17,591,000 $ 16,077,000
Investments in Real Estate and Depreciation	Investments in Real Estate and Depreciation We allocate the purchase price of our properties in accordance with ASC 805 – Business Combinations . If the acquisition does not meet the definition of a business, we record the acquisition as an asset acquisition. For transactions that are business combinations, acquisition costs are expensed as incurred. For transactions that are an asset acquisition, acquisition costs are capitalized as incurred. Upon an asset acquisition of a property, we allocate the purchase price of the property based upon the relative fair value of the tangible and intangible assets acquired and liabilities assumed, which generally consists of land, buildings, site improvements, and furniture and fixtures. We allocate the purchase price to tangible assets of an acquired property by valuing the property as if it were vacant. We are required to make subjective assessments as to the estimated useful lives of our depreciable assets. We consider the period of future benefit of the assets to determine the appropriate estimated useful lives. Depreciation of our assets is being charged to expense on a straight-line basis over the estimated useful lives. We depreciate the fair value allocated to building and improvements over estimated useful lives ranging from 15 to 39 years. We estimate the value of furniture and fixtures based on the assets’ depreciated replacement cost. We depreciate the fair value allocated to furniture and fixtures over estimated useful lives ranging from three to six years. Assets held for sale are not depreciated.
Impairment of Real Estate Properties	Impairment of Real Estate Properties We evaluate the recoverability of the carrying value of our real estate properties on a property-by-property basis. We review our properties for recoverability when events or circumstances, including significant physical changes in the property, significant adverse changes in general economic conditions and significant deteriorations of the underlying cash flows of the property, indicate that the carrying amount of the property may not be fully recoverable. A long-lived asset is impaired when management's estimate of current and projected, undiscounted and unleveraged, operating cash flows of the property is less than the net carrying value of the property. In determining these cash flows, the Company estimates holding periods, market comparable, capitalization rates, future occupancy levels, rental rates, and other relevant inputs. If recognition of an impairment charge is necessary, it is measured as the amount by which the carrying amount of the property exceeds the fair value of the property. We recorded no impairment charges in 2020 and 2019.
Fair Value Measurement	Fair Value Measurements Fair value represents the estimate of the proceeds to be received, or paid in the case of a liability, in a current transaction between willing parties. ASC 820, Fair Value Measurement, establishes a fair value hierarchy to categorize the inputs used in valuation techniques to measure fair value. Inputs are either observable or unobservable in the marketplace. Observable inputs are based on market data from independent sources and unobservable inputs reflect the reporting entity’s assumptions about market participant assumptions used to value an asset or liability. Financial assets and liabilities are categorized based on the inputs to the valuation techniques as follows: Level 1. Quoted prices in active markets for identical instruments. Level 2. Observable inputs other than Level 1 prices, 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. Assets and liabilities measured at fair value are classified according to the lowest level input that is significant to their valuation. A financial instrument that has a significant unobservable input along with significant observable inputs may still be classified as a Level 3 instrument. We generally determine or calculate the fair value of financial instruments using quoted market prices in active markets when such information is available or use appropriate present value or other valuation techniques, such as discounted cash flow analyses, incorporating available market discount rate information for similar types of instruments and our estimates for non-performance and liquidity risk. These techniques are significantly affected by the assumptions used, including the discount rate, credit spreads, and estimates of future cash flow. There were no assets or liabilities measured at fair value on a nonrecurring basis during the year ended December 31, 2020.
Fair Value Measurement Of Financial Instruments	Fair Value Measurement of Financial Instruments Our consolidated balance sheets include the following financial instruments: cash and cash equivalents, restricted cash, notes receivable, deposits, tenant and other receivables, certain other assets, accounts payable and accrued liabilities, security deposits and loans payable. With the exception of the loans payable discussed below, we consider the carrying values to approximate fair value for such financial instruments because of the short period of time between origination of the instruments and their expected payment. As of December 31, 2020 and 2019, the fair value of loans payable was $52.6 million and $47.4 million, compared to the principal balance (excluding debt discount) of $47.2 million and $47.0 million, respectively. The fair value of loans payable was estimated using lending rates available to us for financial instruments with similar terms and maturities. To estimate fair value as of December 31, 2020, we utilized discount rates ranging from 2.8% to 4.2% and a weighted average discount rate of 2.8%. As the inputs to our valuation estimate are neither observable in nor supported by market activity, our loans payable are classified as Level 3 liabilities within the fair value hierarchy. At December 31, 2020 and 2019, we do not have any significant financial assets or financial liabilities that are measured at fair value on a recurring basis in our consolidated financial statements.
Variable Interest Entities	Variable Interest Entities We analyze our contractual and/or other interests to determine whether such interests constitute an interest in a VIE in accordance with ASC 810, Consolidation, and, if so, whether we are the primary beneficiary. If we are determined to be the primary beneficiary of a VIE, we must consolidate the VIE. A VIE is broadly defined as an entity with one or more of the following characteristics: (a) the total equity investment at risk is insufficient to finance the entity’s activities without additional subordinated financial support; (b) as a group, the holders of the equity investment at risk lack (i) the ability to make decisions about the entity’s activities through voting or similar rights, (ii) the obligation to absorb the expected losses of the entity, or (iii) the right to receive the expected residual returns of the entity; and (c) the equity investors have voting rights that are not proportional to their economic interests, and substantially all of the entity’s activities either involve, or are conducted on behalf of, an investor that has disproportionately few voting rights. In determining whether we are the primary beneficiary, we consider, among other things, whether we have the power to direct the activities of the VIE that most significantly impact the entity’s economic performance, including, but not limited to, determining or limiting the scope or purpose of the VIE, selling or transferring property owned or controlled by the VIE, or arranging financing for the VIE. We also consider whether we have the obligation to absorb losses of the VIE or the right to receive benefits from the VIE. We evaluated our wholly and partially owned subsidiaries, CHP, LLC and equity method investments to determine if they are a VIE, and if such VIE should be consolidated. CHP, LLC is consolidated as the Company is deemed the primary beneficiary. Our Operating Partnership’s equity investment in SUL JV, Fantasia JV, Fantasia II JV, Fantasia III JV, FPH JV and Indiana JV met the definition and criteria of VIEs. However, as we do not have power to direct the activities that most significantly impact economic performance of these VIEs, they are accounted for under the equity method of accounting and are reflected as Equity-method investment.
Tenant and Other Receivables	Tenant and Other Receivables Tenant and other receivables are comprised of rental and tenant reimbursement billings due from tenants, the cumulative amount of future adjustments necessary to present rental income on a straight-line basis, asset management fees and distributions receivable. Tenant receivables for rental revenues are recorded at the original amount earned.
Allowance for Credit Losses	Allowance for Credit Losses The allowance for credit losses is maintained on all receivables except for lease receivables and is maintained at a level believed adequate to absorb potential losses in our receivables. The determination of the credit allowance is based on a quarterly evaluation of each of these receivables, including general economic conditions and estimated collectability. We evaluate the collectability of our receivables based on a combination of credit quality indicators, including, but not limited to, payment status, historical charge-offs, and financial strength of the lessee or equity method investment. A receivable is considered to have deteriorated in credit quality when, based on current information and events, it is probable that we will be unable to collect all amounts due. As of December 31, 2020, the allowance for credit losses is immaterial.
Deferred Financing Costs	Deferred Financing Costs Costs incurred with potential financing arrangements are recorded as deferred debt issuance costs. Costs incurred in connection with completed debt financing are recorded as debt issuance costs. Debt issuance costs are amortized using the straight-line basis which approximates the effective interest rate method, over the contractual terms of the respective financings, and are presented net of loans payable in loans payable, net of debt issuance costs, in the consolidated balance sheets.
Deferred Leasing Commissions	Deferred Leasing Commissions Leasing commissions (paid to CRA prior to April 1, 2014) were capitalized at cost and are being amortized on a straight-line basis over the related lease term. As of December 31, 2020 and 2019, total costs incurred were $1.1 million, and the unamortized balance was approximately $0.5 million and $0.6 million, respectively. Amortization expense for the years ended December 31, 2020 and 2019 was approximately $70,000 and $51,000, respectively.
Other Assets	Other Assets Other assets consist primarily of deferred financing and acquisition costs, prepaid insurance, property taxes and other. Additionally, other assets will be amortized to expense over their future service periods. Balances without future economic benefit are expensed as they are identified.
Equity-Method Investments	Equity-Method Investments We report our investments in unconsolidated entities, over whose operating and financial policies we have the ability to exercise significant influence but not control, under the equity method of accounting. Under this method of accounting, our pro rata share of the applicable entity’s earnings or losses is included in our consolidated statements of operations. We initially record our investments based on either the carrying value for properties contributed or the cash invested. We evaluate our equity-method investments for impairment whenever events or changes in circumstances indicate that the carrying value of our investments may exceed the fair value. If it is determined that a decline in the fair value of our investments is not temporary, and if such reduced fair value is below its carrying value, an impairment is recorded. Determining fair value involves significant judgment. Our estimates consider available evidence including the present value of the expected future cash flows discounted at market rates, general economic conditions and other relevant factors. We did not record any impairments related to our equity-method investments for the years ended December 31, 2020 and 2019.
Rental Revenue	Rental Revenue On January 1, 2019, the Company adopted the FASB Accounting Standards Update (“ASU”) 2016-02, Leases (“Topic 842”), using the modified retrospective approach and have elected the package of practical expedients permitted under the transition guidance within the new standard, which, among other things, permits us to carry forward our prior conclusions for lease classification, the ability not to reassess whether any existing or expired contracts contain leases, lease classifications for existing or expired leases, and initial direct costs on existing leases. We also made an accounting policy election to keep short-term leases less than twelve months off the balance sheet for all classes of underlying assets. The new standard requires a lessor to classify leases as either sales-types, finance or operating leases. A lease will be treated as a sales-type lease if it transfers all of the risks and rewards, as well as control of the underlying asset, to the lessee. If risks and rewards are conveyed without the transfer of control, the lease is treated as a financing lease. If the lessor does not convey risks and rewards or control, an operating lease results. After evaluating our tenant leases, we have concluded that these are operating-type leases. Additionally, lessors were provided with the option to elect a practical expedient, which we elected, allowing them to not separate lease and nonlease components in a contract for the purpose of revenue recognition and disclosure. This practical expedient is limited to circumstances in which: (i) the timing and pattern of transfer are the same for the nonlease component and the related lease component and (ii) the lease component, if accounted for separately, would be classified as an operating lease. This practical expedient causes an entity to assess whether a contract is predominantly lease or service based and recognize the entire contract under the relevant accounting guidance (i.e., predominantly lease-based would be accounted for under ASU 2016-02 and predominantly service-based would be accounted for ASC 606). The FASB also issued ASU 2019-20 “Leases (Topic 842) - Narrow Improvements for Lessors,” which provided lessors the ability to make an accounting policy election not to evaluate whether certain sales taxes and other similar taxes imposed by a governmental authority on a specific lease revenue producing transaction are the primary obligation of the lessor as owner of the underlying leased asset. A lessor that makes this election will exclude these taxes from the measurement of lease revenue and the associated expense. Upon adoption of ASC 842, we utilized this practical expedient in cases where real estate taxes were paid directly by our tenants to taxing authorities. For triple-net leasing arrangements in which the tenant remits payment for real estate taxes to us and we pay the taxing authority, we have included the associated revenue and expense in total rental revenues and property operating costs on the consolidated statements of operations. This reporting had no impact on our net income. Additionally, under Topic 842, we must assess if all payments due under the lease are likely to be collected. If tenant lease payments are not likely to be collected, then the revenues will be recognized on a cash basis (or if the answer changes at a later date, the revenues are adjusted to reflect what it would have been on a cash basis) and the adjustments will be recorded through rental revenues, rather than bad debt expense. We did not have any collectability issues for the year ended December 31, 2020.
Acquisition and Asset Management Fees	Acquisition and Asset Management Fees The Company records acquisition and asset management fee revenue based on ASC 606, Revenue from Contracts with Customers (Topic 606) . Acquisition fees arise from contractual agreements with our joint venture partners and are earned and paid at the time we close an acquisition, therefore, satisfying our performance obligations at that time. We earn our asset management fees based on a percentage of the purchase price or equity raised. As the manager, our duty is to manage the day-to-day operations of the special-purpose entities which own the properties. Asset management fees are recognized as a single performance obligation (managing the properties) comprised of a series of distinct services (handling issues with our tenants, etc.). We believe that the overall service of asset management is substantially the same each day and has the same pattern of performance over the term of the agreement. As a result, each day of service represents a performance obligation satisfied at that point in time. These fees are recognized at the end of each period for services performed during that period, billed monthly and paid quarterly.
Stock-Based Compensation	Stock-Based Compensation We record stock-based compensation expense for share-based payments to employees and directors, including grants of stock options based on the estimated fair value of the options on the date of grant using the Black-Scholes option-pricing model. Compensation expense is recognized ratably over the vesting term and is included in general and administrative expense in our consolidated statements of operations. Forfeitures are recognized as they occur. See Note 10 for further information.
Noncontrolling Interest in Consolidated Subsidiary	Noncontrolling Interest in Consolidated Subsidiary Noncontrolling interest relates to the interest in the consolidated entities that are not wholly-owned by us. As of December 31, 2020 and 2019, the noncontrolling interest mainly relates to CHP, LLC. ASC 810‑10‑65, Consolidation , clarifies that a noncontrolling interest in a subsidiary is an ownership interest in the consolidated entity that should be reported as equity in the consolidated financial statements. ASC 810‑10‑65 also requires consolidated net income to be reported at amounts that include the amounts attributable to both the parent and the noncontrolling interest and requires disclosure, on the face of the consolidated statements of operations, of the amounts of consolidated net income attributable to the parent and to the noncontrolling interest. We periodically evaluate individual noncontrolling interests for the ability to continue to recognize the noncontrolling interest as permanent equity in the consolidated balance sheets. Any noncontrolling interest that fails to qualify as permanent equity will be reclassified as temporary equity and adjusted to the greater of (a) the carrying amount, or (b) its redemption value as of the end of the period in which the determination is made.
Income Taxes	Income Taxes We have elected to be taxed as a REIT, under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”) beginning with our taxable year ending December 31, 2006. To qualify as a REIT, we must meet certain organizational and operational requirements, including a requirement to currently distribute at least 90% of the REIT’s ordinary taxable income to stockholders. As a REIT, we generally will not be subject to federal income tax on taxable income that we distribute to our stockholders. If we fail to qualify as a REIT in any taxable year, we will then be subject to federal income taxes on our taxable income at regular corporate rates and will not be permitted to qualify for treatment as a REIT for federal income tax purposes for four years following the year during which qualification is lost unless the Internal Revenue Service were to grant us relief under certain statutory provisions. Such an event could materially and adversely affect our net income and net cash available for distribution to stockholders. However, we believe that we will be organized and operate in such a manner as to qualify for treatment as a REIT and intend to operate for the foreseeable future in such a manner so that we will remain qualified as a REIT for federal income tax purposes. Given the applicable statute of limitations, we generally are subject to audit by the Internal Revenue Service (“IRS”) for the year ended December 31, 2016 and subsequent years, and state income tax returns are subject to audit for the year ended December 31, 2015 and subsequent years. We have elected to treat SAM TRS as a taxable REIT subsidiary, which generally may engage in any business, including the provision of customary or non-customary services for our tenants. SAM TRS is treated as a regular corporation and is subject to federal income tax and applicable state income and franchise taxes at regular corporate rates. SAM TRS has deferred tax assets related to their NOL (which expires in or after 2035 for federal and state) for a total of $1,493,000, which has a full valuation allowance as of December 31, 2020 and 2019. Due to the losses incurred and the full valuation allowance on deferred tax assets, there was no tax provision related to SAM TRS in 2020 and 2019.
Uncertain Tax Positions	Uncertain Tax Positions In accordance with the requirements of ASC 740, Income Taxes, favorable tax positions are included in the calculation of tax liabilities if it is more likely than not that our adopted tax position will prevail if challenged by tax authorities. As a result of our REIT status, we are able to claim a dividends-paid deduction on our tax return to deduct the full amount of common dividends paid to stockholders when computing our annual taxable income, which results in our taxable income being passed through to our stockholders. A REIT is subject to a 100% tax on the net income from prohibited transactions. A “prohibited transaction” is the sale or other disposition of property held primarily for sale to customers in the ordinary course of a trade or business. There is a safe harbor provision which, if met, expressly prevents the Internal Revenue Service from asserting the prohibited transaction test. We have no income tax expense, deferred tax assets or deferred tax liabilities associated with any such uncertain tax positions for the operations of any entity included in the consolidated results of operations. We classify interest and penalties related to uncertain tax positions, if any, in our consolidated financial statements as a component of general and administrative expense.
Basic and Diluted Net Income (Loss) and Distributions per Common Share	Basic and Diluted Net Income (Loss) and Distributions per Common Share Basic earnings per share is computed by dividing net income (loss) by the weighted-average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing net income (loss) by the weighted-average number of common shares and dilutive potential common shares outstanding during the period. Dilutive potential common shares are calculated in accordance with the treasury stock method, which assumes that proceeds from the exercise of all stock options are used to repurchase common stock at our NAV value. See Note 12 for further information.
Lake forest Lease	Lake Forest Lease We have entered into a lease agreement, as amended, for corporate office space located in Lake Forest, California, which expires in April 2022 (the “LF Lease”). In 2019, based on Topic 842, we recorded a right-of-use asset and lease liability equal to the present value of the remaining lease payments within the consolidated balance sheet. As a result, the Company recognized a right-of-use asset (“ROU”) of $0.3 million and a lease liability of $0.3 million on its consolidated balance sheet as of January 1, 2019. As of December 31, 2020 and 2019, the Company had a ROU operating lease asset of $0.1 million and $0.2 million, respectively, recorded in other assets in our consolidated balance sheets and a lease liability of $0.1 million and $0.2 million, respectively, recorded in our consolidated balance sheets in accrued liabilities. The Company recognized lease expense, calculated as the remaining cost of the lease allocated over the remaining lease term on a straight-line basis. Lease expense is presented as part of continuing operations within general and administrative expenses in the consolidated statements of operations. For the years ended December 31, 2020 and 2019, the Company recognized approximately $0.1 million in lease expense. For the years ended December 31, 2020 and 2019, the Company paid $100,000 in rent relating to the LF Lease. As a payment arising from an operating lease, the $0.1 million is classified within operating activities in the consolidated statements of cash flows. As of December 31, 2020, the remaining lease term for LF Lease is 16 months. Because we do not have access to the discount rate implicit in the lease, we have utilized our estimated incremental borrowing rate as the discount rate. The estimated discount rate associated with our corporate operating lease is 5%. Pursuant to ASC 842, lease payments on the LF Lease for each of the following years ending December 31 are as follows: Year Lease payments 2021 $ 108,000 2022 36,000 Total lease payments $ 144,000 Less effect of discounting (5,000) Total lease liability $ 139,000
Recently Issued And Adopted Accounting Pronouncements	Recently Issued Accounting Pronouncements In January 2020, the FASB issued ASU 2020-01 (“Update”) to clarify the interaction among the accounting standards for equity securities, equity method investments and certain derivatives. The new ASU clarifies that a company should consider observable transactions that require a company to either apply or discontinue the equity method of accounting under Topic 323, Investments—Equity Method and Joint Ventures, for the purposes of applying the measurement alternative in accordance with Topic 321 immediately before applying or upon discontinuing the equity method. For public business entities, the amendments in this update are effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. The Company believes the implementation of the new standard will not have a material effect on its financial position, results of operations, and cash flows. Recently Adopted Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). ASU 2016-13 requires that a financial asset (or a group of financial assets) measured at amortized cost basis be presented at the net amount expected to be collected. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial asset(s) to present the net carrying value at the amount expected to be collected on the financial asset. The amendments in ASU 2016-13 are an improvement because they eliminate the probable initial recognition threshold under current GAAP and, instead, reflect an entity’s current estimate of all expected credit losses. Previously, when credit losses were measured under GAAP, an entity generally only considered past events and current conditions in measuring the incurred loss. In November 2018, the FASB issued ASU 2018-19, Codification Improvements to Topic 326, Financial Instruments—Credit Losses (“ASU 2018-19”), which amends ASU 2016-13 to clarify that receivables arising from operating leases are not within the scope of Subtopic 326-20, and instead, impairment of such receivables should be accounted for in accordance with ASU 2016-02, Leases, as amended by subsequent ASUs (“Topic 842”). In November 2019, the FASB issued ASU 2019-11, Codification Improvements to Topic 326, Financial Instruments—Credit Losses (“ASU 2019-11”), which amends ASU 2016-13 to clarify or address stakeholders’ specific issues about certain aspects of ASU 2016-13. ASU 2016-13, ASU 2018-19 and ASU 2019-11 are effective for fiscal years and interim periods within those years beginning after December 15, 2019, with early adoption permitted as of the fiscal years beginning after December 15, 2018. The Company adopted ASU 2016-13, ASU 2018-19 and ASU 2019-11 (collectively, “Topic 326”) on January 1, 2020. The adoption of the new standard on January 1, 2020 did not have a material effect on the Company’s financial position, results of operations, or cash flows.
Coronavirus (COVID-19)	Coronavirus (COVID-19) Since first being reported in December 2019, COVID-19 has spread globally, including to every state in the United States and more than 200 countries. On March 11, 2020, the World Health Organization declared COVID-19 a pandemic, and on March 13, 2020, the United States declared a national emergency with respect to COVID-19. The outbreak has led governments and other authorities around the world, including federal, state and local authorities in the United States, to impose measures intended to control its spread, including restrictions on freedom of movement and business operations such as travel bans, border closings, business closures, quarantines and shelter-in-place orders. The COVID-19 pandemic and measures to prevent its spread negatively impacted senior housing and skilled nursing facilities in a number of ways, including but not limited to: · Decreased occupancy and increased operating costs for the Company’s tenants and borrowers, which may adversely impact their ability to make full and timely rental and debt payments to the Company. As of and for the year ended December 31, 2020, the Company has not provided any rental concessions. However, the Company may have to restructure tenants’ long-term rent obligations in the future and may not be able to do so on terms that are as favorable to the Company as those currently in place. Reduced or modified rental and debt amounts could result in the determination that the full amounts of the Company’s real estate properties and notes receivable are not recoverable, which could result in an impairment charge. · Decreased occupancy and increased operating costs for the Company’s Equity-Method Investments that own senior housing and skilled nursing facilities, which may negatively impact the operating results of these investments. As of and for the year ended December 31, 2020, the Equity-Method Investments have not provided any rental concessions. However, the Equity-Method Investments may have to restructure tenants’ long-term rent obligations and may not be able to do so on terms that are as favorable to the Equity-Method Investments as those currently in place. Prolonged deterioration in the operating results for these investments could result in the determination that the full amounts of the Company’s investments are not recoverable, which could result in an impairment charge. It is impossible to predict the effect and ultimate impact of the COVID-19 pandemic on our operations and results as the situation is continuing to evolve. We have not seen a material impact on rental revenue from any of our consolidated properties or debt payments from borrowers on notes receivable. However, under a court order, a receiver assumed the responsibilities of operating and managing the Pennington Gardens facility in Chandler, Arizona. Based upon need and request, the Company may provide rent relief, either in the form of a temporary rent reduction to be paid back over time or permanent abatement of rent for a specific time period. Additionally, some of our Equity-Method Investment tenants have also experienced decreased occupancy and increased operating costs related to COVID-19, however, this has not had a material effect on our consolidated financial statements. The rapid development and fluidity of this situation precludes any prediction as to the ultimate material adverse impact on the demand for senior housing and skilled nursing and presents material uncertainty and risk with respect to our business, operations, financial condition and liquidity, including recording impairments, lease modifications and credit losses associated with notes receivable in future periods.
CARES Act	CARES Act In March 2020, the Coronavirus Aid, Relief, and Economic Security Act was enacted and amended in December 2020 (the “CARES Act”). The CARES Act is a stimulus package that provides various forms of relief through, among other things, grants, loans and tax incentives to certain businesses and individuals. In particular, the CARES Act created an emergency lending facility known as the Paycheck Protection Program (PPP), which is administered by the Small Business Administration (SBA) and provides federally insured and, in some cases, forgivable loans to certain eligible businesses so that those businesses can continue to cover certain of their near-term operating expenses and retain employees. We did not obtain a PPP loan. We have evaluated the CARES Act and determined that there was no impact on the Company for the year ended December 31, 2020. We will continue to evaluate and monitor the CARES Act, and any new COVID-19-related legislation to determine the ultimate impact and benefits, if any, to the Company.

Summary of Significant Accoun_3

Summary of Significant Accounting Policies (Tables)	12 Months Ended
	Dec. 31, 2020
Summary of Significant Accounting Policies
Schedule of restrictions on Cash and Cash Equivalents	The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown on the consolidated statements of cash flows: December 31, December 31, 2020 2019 Cash and cash equivalents $ 14,658,000 $ 13,260,000 Restricted cash 2,933,000 2,817,000 Total cash, cash equivalents, and restricted cash shown on the consolidated statements of cash flows $ 17,591,000 $ 16,077,000
Schedule of lease payments on the LF Lease as per 842	Pursuant to ASC 842, lease payments on the LF Lease for each of the following years ending December 31 are as follows: Year Lease payments 2021 $ 108,000 2022 36,000 Total lease payments $ 144,000 Less effect of discounting (5,000) Total lease liability $ 139,000

Investments in Real Estate Pr_2

Investments in Real Estate Properties (Tables)	12 Months Ended
	Dec. 31, 2020
Investments in Real Estate Properties
Schedule of business acquisitions, by acquisition	As of December 31, 2020 and 2019, investments in real estate properties including those held by our consolidated subsidiaries (excluding the 50 properties owned by our unconsolidated Equity-Method Investments) are set forth below: 2020 2019 Land $ 6,237,000 $ 6,237,000 Buildings and improvements 48,295,000 48,295,000 Less: accumulated depreciation (9,853,000) (8,444,000) Buildings and improvements, net 38,442,000 39,851,000 Furniture and fixtures 4,230,000 4,230,000 Less: accumulated depreciation (3,988,000) (3,805,000) Furniture and fixtures, net 242,000 425,000 Real estate properties, net $ 44,921,000 $ 46,513,000
Schedule of real estate properties	The following table provides summary information regarding our portfolio (excluding the 50 properties owned by our unconsolidated Equity-Method Investments) as of December 31, 2020: Loans Payable, Excluding Debt Purchase Issuance Property Location Date Purchased Type (1) Price Costs Sheridan Care Center Sheridan, OR August 3, 2012 SNF $ 4,100,000 $ 4,330,000 Fernhill Care Center Portland, OR August 3, 2012 SNF 4,500,000 3,798,000 Friendship Haven Healthcare and Rehabilitation Center Galveston County, TX September 14, 2012 SNF 15,000,000 11,746,000 Pacific Health and Rehabilitation Center Tigard, OR December 24, 2012 SNF 8,140,000 6,332,000 Brookstone of Aledo Aledo, IL July 2, 2013 AL 8,625,000 6,859,000 Sundial Assisted Living Redding, CA December 18, 2013 AL 3,500,000 3,792,000 Pennington Gardens Chandler, AZ July 17, 2017 AL/MC 13,400,000 10,330,000 Total: $ 57,265,000 $ 47,187,000 (1) SNF is an abbreviation for skilled nursing facility. AL is an abbreviation for assisted living facility. MC is an abbreviation for memory care facility.
Schedule of Future Minimum Rental Payments to be Received	The future minimum lease payments to be received under existing operating leases for our consolidated properties as of December 31, 2020 are as follows: Years ending December 31, 2021 5,547,000 2022 5,662,000 2023 5,778,000 2024 5,441,000 2025 5,549,000 Thereafter 23,341,000 $ 51,318,000 2020 Acquisitions None.

Loans Payable (Tables)

Loans Payable (Tables)	12 Months Ended
	Dec. 31, 2020
Loans Payable
Schedule of debt	As of December 31, 2020 and 2019, loans payable consisted of the following: December 31, 2020 December 31, 2019 Loan payable to CIBC Bank USA refinanced in April 2020 and as of December 31, 2019, collateralized by Friendship Haven. $ — $ 10,725,000 Loan payable to Capital One Multifamily Finance, LLC (insured by HUD) in monthly installments of approximately $49,000, including interest at a fixed rate of 4.23%, due in September 2053, and collateralized by Pennington Gardens. $ 10,330,000 $ 10,473,000 Loans payable to Lument (formerly ORIX Real Estate Capital, LLC) (insured by HUD) in monthly installments of approximately $183,000, including interest, ranging from a fixed rate of 2.79% to 4.2%, due in September 2039 through April 2055, and as of December 31, 2020, collateralized by Sheridan, Fernhill, Pacific Health, Aledo, Sundial Assisted Living and Friendship Haven. As of December 31, 2019, collateralized by Sheridan, Fernhill, Pacific Health, Aledo and Sundial Assisted Living. $ 36,857,000 $ 25,804,000 47,187,000 47,002,000 Less debt issuance costs (1,913,000) (1,425,000) Total loans payable $ 45,274,000 $ 45,577,000
Schedule of maturities of long-term debt	The principal payments due on the loans payable (excluding debt issuance costs) for each of the five following years and thereafter ending December 31 are as follows: Principal Year Amount 2021 1,076,000 2022 1,116,000 2023 1,158,000 2024 1,201,000 2025 1,246,000 Thereafter 41,390,000 $ 47,187,000

Equity-Method Investments (Tabl

Equity-Method Investments (Tables)	12 Months Ended
	Dec. 31, 2020
Equity-Method Investments
Schedule of Summarized Financial Data for Equity-Method Investments	Our Equity-Method Investments are significant equity-method investments in the aggregate. The results of operations of our Equity-Method Investments for the years ending December 31, 2020 are summarized below: Fantasia Fantasia Fantasia FPH Combined SUL JV JV II JV III JV JV Indiana JV Total Revenue $ 18,247,000 $ 4,112,000 $ 3,557,000 $ 7,982,000 $ 3,537,000 $ 11,786,000 $ 49,221,000 Income from Operations $ 7,831,000 $ 557,000 $ 1,960,000 $ 4,132,000 $ 1,681,000 $ 7,447,000 $ 23,608,000 Net Income $ 3,465,000 $ (55,000) $ 992,000 $ 1,795,000 $ (779,000) $ (479,000) $ 4,939,000 Summit interest in Equity-Method Investments net income $ 346,000 $ (19,000) $ 198,000 $ 179,000 $ (78,000) $ (71,000) $ 555,000 The results of operations of our Equity-Method Investments for the year ending December 31, 2019 are summarized below: Fantasia Fantasia Fantasia FPH Combined SUL JV JV II JV III JV JV Indiana JV Total Revenue $ 18,295,000 $ 3,271,000 $ 3,536,000 $ 7,914,000 $ 3,564,000 $ 9,464,000 $ 46,044,000 Income from Operations $ 7,851,000 $ 824,000 $ 1,912,000 $ 4,135,000 $ 1,677,000 $ 6,042,000 $ 22,441,000 Net Income $ 1,284,000 $ (315,000) $ 923,000 $ 1,302,000 $ (723,000) $ (516,000) $ 1,955,000 Summit interest in Equity-Method Investments net income $ 128,000 $ (110,000) $ 185,000 $ 130,000 $ (72,000) $ (77,000) $ 184,000
Schedule of Distributions receivable	As of December 31, 2020 and 2019, we have distributions receivable, which is included in tenant and other receivables in our consolidated balance sheets, as follows: December 31, December 31, 2020 2019 SULH JV $ 466,000 $ 97,000 Fantasia JV 36,000 180,000 Fantasia II JV 51,000 48,000 Fantasia III JV 257,000 117,000 FPH JV 26,000 39,000 Indiana JV 498,000 162,000 Total $ 1,334,000 $ 643,000
Schedule of Cash Distributions	For the years ended December 31, 2020 and 2019, we received cash distributions, which are included in our cash flows from operating activities in the change in tenant and other receivables, and cash flows from investing activities, using the cumulative earnings approach, as follows: Year Ended December 31, 2020 Year Ended December 31, 2019 Total Cash Cash Flow Cash Flow Total Cash Cash Flow Cash Flow Distributions from from Distributions from from Received Operating Investing Received Operating Investing SUL JV $ 499,000 $ 346,000 $ 153,000 $ 548,000 $ 128,000 $ 420,000 Fantasia JV 144,000 — 144,000 — — — Fantasia II JV 292,000 198,000 94,000 276,000 185,000 91,000 Fantasia III JV 104,000 104,000 — 160,000 130,000 30,000 FPH JV 152,000 — 152,000 306,000 — 306,000 Indiana JV 429,000 — 429,000 377,000 — 377,000 Total $ 1,620,000 $ 648,000 $ 972,000 $ 1,667,000 $ 443,000 $ 1,224,000

Receivables (Tables)

Receivables (Tables)	12 Months Ended
	Dec. 31, 2020
Receivables
Schedule of tenant and other receivables	Tenant and other receivables, net consists of: December 31, December 31, 2020 2019 Straight-line rent receivables $ 2,772,000 $ 2,546,000 Distribution receivables from Equity-Method Investments 1,334,000 643,000 Receivable from JV 2 properties 11,000 184,000 Asset management fees 432,000 430,000 Other receivables 128,000 9,000 Total $ 4,677,000 $ 3,812,000

Related Party Transactions (Tab

Related Party Transactions (Tables)	12 Months Ended
	Dec. 31, 2020
Related Party Transactions
Schedule of related party transactions	As of December 31, 2020 and 2019, we had the following receivables and reserves: Receivables Reserves Balance Organizational and offering costs $ 738,000 $ (738,000) $ — Asset management fees and expenses 32,000 (32,000) — Operating expenses (direct and indirect) 189,000 (189,000) — Operating expenses (2%/25% Test) 1,717,000 (1,717,000) — Total $ 2,676,000 $ (2,676,000) $ —

Equity (Tables)

Equity (Tables)	12 Months Ended
	Dec. 31, 2020
Equity
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions	The estimated fair value using the Black-Scholes option-pricing model with the following weighted average assumptions: 2020 Stock options granted 45,000 Expected volatility 22.31 % Expected term years Risk-free interest rate % Dividend yield % Fair value per stock option $
Share-based Compensation, Stock Options, Activity	The following table summarizes our stock options as of December 31, 2020: Weighted Weighted Average Average Remaining Aggregate Exercise Contractual Intrinsic Options Price Term Value Options outstanding at January 1, 2020 1,826,908 $ 2.09 Granted 45,000 2.26 Exercised — Cancelled/forfeited — Options outstanding at December 31, 2020 1,871,908 $ 2.09 6.81 $ 1,524,000 Options exercisable at December 31, 2020 1,729,876 $ 2.07 6.69 $ 1,433,000
Schedule of Unrecognized Compensation Cost, Nonvested Awards	Years Ending December 31, 2021 66,000 2022 15,000 2023 1,000 $ 82,000

Earnings Per Share (Tables)

Earnings Per Share (Tables)	12 Months Ended
	Dec. 31, 2020
Earnings Per Share
Schedule of basic and diluted earning per share and reconciliation weighted average common stock outstanding	The following table presents the calculation of basic and diluted earnings per share (“EPS”) for the Company’s common stock for the years ended December 31, 2020 and 2019, and reconciles the weighted-average common shares outstanding used in the calculation of basic EPS to the weighted-average common shares outstanding used in the calculation of diluted EPS: 2020 2019 Numerator: (Loss) income from continuing operations $ (557,000) $ 3,030,000 (Loss) income from continuing operations attributable to noncontrolling interest (56,000) 83,000 Net (loss) income applicable to common stockholders $ (613,000) $ 3,113,000 Denominator: Basic: Denominator for basic EPS - weighted average shares 23,027,978 23,027,978 Effect of dilutive shares: Stock options — 478,500 Denominator for diluted EPS – adjusted weighted average shares 23,027,978 23,506,478 Basic EPS $ (0.03) $ 0.14 Diluted EPS $ (0.03) $ 0.13

Organization (Details)

Organization (Details)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Organization [Line Items]
Equity method investment, ownership percentage	10.00%	10.00%
Cornerstone Operating Partnership [Member]
Organization [Line Items]
Limited Liability Company (LLC) or Limited Partnership (LP), Members or Limited Partners, Ownership Interest	99.88%
Cornerstone Operating Partnership [Member] | Cornerstone Realty Advisors, LLC [Member]
Organization [Line Items]
Limited Liability Company (LLC) or Limited Partnership (LP), Members or Limited Partners, Ownership Interest by Affiliates	0.12%
Cornerstone Healthcare Partners [Member]
Organization [Line Items]
Limited Liability Company (LLC) or Limited Partnership (LP), Members or Limited Partners, Ownership Interest	95.00%
Cornerstone Healthcare Real Estate Fund [Member]
Organization [Line Items]
Limited Liability Company (LLC) or Limited Partnership (LP), Members or Limited Partners, Ownership Interest by Affiliates	5.00%
JV Properties [Member]
Organization [Line Items]
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners	4.70%
Summit Union Life Holding [Member]
Organization [Line Items]
Real Estate Investment Trust Own Percentage	10.00%
Four Jv Properties [Member]
Organization [Line Items]
Limited Liability Company (LLC) or Limited Partnership (LP), Members or Limited Partners, Ownership Interest	95.30%
Summit Fantasia ll Holdings LLC [Member]
Organization [Line Items]
Limited Liability Company (LLC) or Limited Partnership (LP), Members or Limited Partners, Ownership Interest by Affiliates	20.00%	20.00%
Fantasia III JV
Organization [Line Items]
Limited Liability Company (LLC) or Limited Partnership (LP), Members or Limited Partners, Ownership Interest	10.00%	10.00%
Equity method investment, ownership percentage	10.00%
Summit Fantasy Pearl Holdings, LLC [Member]
Organization [Line Items]
Limited Liability Company (LLC) or Limited Partnership (LP), Members or Limited Partners, Ownership Interest	10.00%	10.00%
Fantasia II JV
Organization [Line Items]
Equity method investment, ownership percentage	20.00%
Fantasia JV
Organization [Line Items]
Limited Liability Company (LLC) or Limited Partnership (LP), Members or Limited Partners, Ownership Interest	35.00%
Summit Fantasia Holdings, LLC
Organization [Line Items]
Limited Liability Company (LLC) or Limited Partnership (LP), Members or Limited Partners, Ownership Interest by Affiliates	35.00%	35.00%
Summit Health Care Four Properties [Member]
Organization [Line Items]
Limited Liability Company (LLC) or Limited Partnership (LP), Members or Limited Partners, Ownership Interest by Affiliates	95.30%
Summit Health Care Three Properties [Member]
Organization [Line Items]
Equity method investment, ownership percentage	100.00%
Indiana JV
Organization [Line Items]
Limited Liability Company (LLC) or Limited Partnership (LP), Members or Limited Partners, Ownership Interest	15.00%
Equity method investment, ownership percentage	15.00%	15.00%

Summary of Significant Accoun_4

Summary of Significant Accounting Policies - Restricted Cash (Details) - USD ($)	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Summary of Significant Accounting Policies
Cash and cash equivalents	$ 14,658,000	$ 13,260,000
Restricted cash	2,933,000	2,817,000
Total cash, cash equivalents, and restricted cash shown on the consolidated statements of cash flows	$ 17,591,000	$ 16,077,000	$ 14,956,000

Summary of Significant Accoun_5

Summary of Significant Accounting Policies - Lease liability (Details) - USD ($)	Dec. 31, 2020	Jan. 01, 2019
Summary of Significant Accounting Policies
2021	$ 108,000
2022	36,000
Total lease payments	144,000
Less effect of discounting	(5,000)
Total lease liability	$ 139,000	$ 300,000

Summary of Significant Accoun_6

Summary of Significant Accounting Policies - Additional Information (Details) - USD ($)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Jan. 01, 2019
Summary of Significant Accounting Policies [Line Items]
Loans Payable, Fair Value Disclosure	$ 52,600,000	$ 47,400,000
Long-term Debt, Gross	47,187,000	47,002,000
Deferred Costs, Total	1,100,000	1,100,000
Deferred Costs, Leasing, Net, Total	536,000	607,000
Amortization	70,000	51,000
Deferred Tax Assets, Valuation Allowance	1,493,000	1,493,000
Operating Lease, Right-of-Use Asset			$ 300,000
Operating Lease, Liability	$ 139,000		$ 300,000
Operating Lease, Liability, Statement of Financial Position [Extensible List]	Accounts Payable and Accrued Liabilities		Accounts Payable and Accrued Liabilities
Additions to Other Assets, Amount	$ 100,000	200,000
Accrued Liabilities	100,000	200,000
Operating Lease, Expense	100,000	100,000
Payments for Rent	100,000	100,000
Operating Lease, Payments	$ 100,000
Operating Lease, Weighted Average Discount Rate, Percent	5.00%
Operating Remaining lease term	16 months
Financing Receivable, Net	$ 262,000	$ 575,000
Real Estate Investment Trust [Member]
Summary of Significant Accounting Policies [Line Items]
Percentage Of Taxable Income	90.00%
Minimum [Member]
Summary of Significant Accounting Policies [Line Items]
Fair Value, Inputs Discount Rate, Loans payable	2.80%
Minimum [Member] | Property, Plant and Equipment, Other Types [Member]
Summary of Significant Accounting Policies [Line Items]
Property, Plant and Equipment, Useful Life	15 years
Maximum [Member]
Summary of Significant Accounting Policies [Line Items]
Fair Value, Inputs Discount Rate, Loans payable	4.20%
Maximum [Member] | Property, Plant and Equipment, Other Types [Member]
Summary of Significant Accounting Policies [Line Items]
Property, Plant and Equipment, Useful Life	39 years
Weighted Average [Member]
Summary of Significant Accounting Policies [Line Items]
Fair Value, Inputs Discount Rate, Loans payable	2.80%

Investments in Real Estate Pr_3

Investments in Real Estate Properties - Investments in real estate properties (Details) - USD ($)	Dec. 31, 2020	Dec. 31, 2019
Real Estate Properties [Line Items]
Real estate properties, net	$ 44,921,000	$ 46,513,000
Land [Member]
Real Estate Properties [Line Items]
Real estate properties, net	6,237,000	6,237,000
Buildings and improvements [Member]
Real Estate Properties [Line Items]
Investments in real estate	48,295,000	48,295,000
Less: accumulated depreciation	(9,853,000)	(8,444,000)
Real estate properties, net	38,442,000	39,851,000
Furniture and fixtures [Member]
Real Estate Properties [Line Items]
Investments in real estate	4,230,000	4,230,000
Less: accumulated depreciation	(3,988,000)	(3,805,000)
Real estate properties, net	$ 242,000	$ 425,000

Investments in Real Estate Pr_4

Investments in Real Estate Properties - Summary information regarding portfolio (Details)	12 Months Ended
	Dec. 31, 2020USD ($)
Real Estate Properties [Line Items]
Purchase Price	$ 57,265,000
Loans Payable, Excluding Debt Issuance Costs	$ 47,187,000
Sheridan Care Center [Member]
Real Estate Properties [Line Items]
Location	Sheridan, OR
Date Purchased	Aug. 3, 2012
Type Of property	SNF	[1]
Purchase Price	$ 4,100,000
Loans Payable, Excluding Debt Issuance Costs	$ 4,330,000
Fernhill Care Center [Member]
Real Estate Properties [Line Items]
Location	Portland, OR
Date Purchased	Aug. 3, 2012
Type Of property	SNF	[1]
Purchase Price	$ 4,500,000
Loans Payable, Excluding Debt Issuance Costs	$ 3,798,000
Friendship Haven Healthcare and Rehabilitation Center [Member]
Real Estate Properties [Line Items]
Location	Galveston County, TX
Date Purchased	Sep. 14, 2012
Type Of property	SNF	[1]
Purchase Price	$ 15,000,000
Loans Payable, Excluding Debt Issuance Costs	$ 11,746,000
Pacific Health and Rehabilitation Center [Member]
Real Estate Properties [Line Items]
Location	Tigard, OR
Date Purchased	Dec. 24, 2012
Type Of property	SNF	[1]
Purchase Price	$ 8,140,000
Loans Payable, Excluding Debt Issuance Costs	$ 6,332,000
Brookstone of Aledo [Member]
Real Estate Properties [Line Items]
Location	Aledo, IL
Date Purchased	Jul. 2, 2013
Type Of property	AL	[1]
Purchase Price	$ 8,625,000
Loans Payable, Excluding Debt Issuance Costs	$ 6,859,000
Sundial Assisted Living [Member]
Real Estate Properties [Line Items]
Location	Redding, CA
Date Purchased	Dec. 18, 2013
Type Of property	AL	[1]
Purchase Price	$ 3,500,000
Loans Payable, Excluding Debt Issuance Costs	$ 3,792,000
Pennington Gardens [Member]
Real Estate Properties [Line Items]
Location	Chandler, AZ
Date Purchased	Jul. 17, 2017
Type Of property	AL/MC	[1]
Purchase Price	$ 13,400,000
Loans Payable, Excluding Debt Issuance Costs	$ 10,330,000
[1]	(1)SNF is an abbreviation for skilled nursing facility. AL is an abbreviation for assisted living facility. MC is an abbreviation for memory care facility.

Investments in Real Estate Pr_5

Investments in Real Estate Properties - Future Minimum Lease Payments (Details)	Dec. 31, 2020USD ($)
Investments in Real Estate Properties
2021	$ 5,547,000
2022	5,662,000
2023	5,778,000
2024	5,441,000
2025	5,549,000
Thereafter	23,341,000
Operating Leases, Future Minimum Payments Receivable	$ 51,318,000

Investments in Real Estate Pr_6

Investments in Real Estate Properties - Additional Information (Details) $ in Millions	12 Months Ended
	Dec. 31, 2020USD ($)	Dec. 31, 2019USD ($)
Investments in Real Estate Properties
Number of Real Estate Properties	7
Percentage of Real Estate Properties	100.00%
Depreciation	$ 1.6	$ 1.7

Loans Payable - Debt (Details)

Loans Payable - Debt (Details) - USD ($)	Dec. 31, 2020	Dec. 31, 2019
Debt Instrument [Line Items]
Long-term Debt, Gross	$ 47,187,000	$ 47,002,000
Less debt issuance costs	(1,913,000)	(1,425,000)
Total loans payable	45,274,000	45,577,000
Cibc Bank [Member]
Debt Instrument [Line Items]
Long-term Debt, Gross	0	10,725,000
Capital One Multifamily Finance LLC [Member]
Debt Instrument [Line Items]
Long-term Debt, Gross	10,330,000	10,473,000
ORIX Real Estate Capital LLC [Member]
Debt Instrument [Line Items]
Long-term Debt, Gross	$ 36,857,000	$ 25,804,000

Loans Payable (Details) _Parent

Loans Payable (Details) [Parenthetical] - USD ($)	Apr. 23, 2020	Apr. 30, 2019	Dec. 31, 2020
Debt Instrument, Periodic Payment	$ 10,725,000
Debt Instrument, Basis Spread on Variable Rate	100.00%
Debt Instrument, Interest Rate, Stated Percentage	2.79%
Capital One Multifamily Finance LLC [Member]
Debt Instrument, Periodic Payment			$ 49,000
Debt Instrument, Interest Rate, Stated Percentage			4.23%
ORIX Real Estate Capital LLC [Member]
Debt Instrument, Periodic Payment			$ 183,000
Debt Instrument, Basis Spread on Variable Rate		100.00%
Debt Instrument, Interest Rate, Stated Percentage		4.20%
ORIX Real Estate Capital LLC [Member] | Minimum [Member]
Debt Instrument, Interest Rate, Stated Percentage			2.79%
ORIX Real Estate Capital LLC [Member] | Maximum [Member]
Debt Instrument, Interest Rate, Stated Percentage			4.20%

Loans Payable - Maturities of l

Loans Payable - Maturities of long term debt (Details)	Dec. 31, 2020USD ($)
Loans Payable
2021	$ 1,076,000
2022	1,116,000
2023	1,158,000
2024	1,201,000
2025	1,246,000
Thereafter	41,390,000
Total	$ 47,187,000

Loans Payable - Additional Info

Loans Payable - Additional Information (Details)	Apr. 23, 2020USD ($)	Apr. 30, 2019USD ($)	Dec. 31, 2020USD ($)	Dec. 31, 2019USD ($)	Mar. 31, 2019USD ($)
Debt Instrument [Line Items]
Debt Instrument, Periodic Payment	$ 10,725,000
Debt Instrument, Interest Rate, Stated Percentage	2.79%
Interest Expense, Debt			$ 2,100,000	$ 2,500,000
Long-term Debt, Gross			47,187,000	47,002,000
Amortization of Debt Discount (Premium)			200,000	100,000
Debt Extinguishment Percentage	10.00%
Payments of Debt Issuance Costs			656,000	210,000
Debt Instrument Mortgage Insurance Premium percentage	0.65%
Debt Instrument, Basis Spread on Variable Rate	100.00%
Debt Instrument, Term	35 years
Reduction in Prepayment penalty after year 1 (as a percent)	1
Debt Instrument, Unamortized Discount			1,913,000	1,425,000
Proceeds from issuance of debt	$ 11,900,000
Line of Credit Facility, Fair Value of Amount Outstanding	10,800,000
Debt issuance costs	$ 700,000
Cibc Bank [Member]
Debt Instrument [Line Items]
Long-term Debt, Gross			0	10,725,000
Long-term Debt, Fair Value					$ 10,725,000
ORIX Real Estate Capital LLC [Member]
Debt Instrument [Line Items]
Debt Instrument, Periodic Payment			183,000
Debt Instrument, Interest Rate, Stated Percentage		4.20%
Long-term Debt, Gross			$ 36,857,000	$ 25,804,000
Debt Instrument Mortgage Insurance Premium percentage		0.65%
Debt Instrument, Basis Spread on Variable Rate		100.00%
Debt Instrument, Term		35 years
Prepayment Premium percentage Prior to First anniversary		10.00%
Reduction in Prepayment penalty after year 1 (as a percent)		1
Debt Issuance Costs, Gross		$ 210,000

Equity-Method Investments - Sum

Equity-Method Investments - Summarized Financial Data for Equity-Method Investments (Details) - USD ($)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Schedule of Equity Method Investments [Line Items]
Revenue	$ 7,787,000	$ 8,065,000
Income from Operations	23,608,000	22,441,000
Net income	(557,000)	3,030,000
Summit interest in Equity-Method Investments net income	555,000	184,000
SUL JV
Schedule of Equity Method Investments [Line Items]
Income from Operations	7,831,000	7,851,000
Summit interest in Equity-Method Investments net income	346,000	128,000
Fantasia JV
Schedule of Equity Method Investments [Line Items]
Income from Operations	557,000	824,000
Summit interest in Equity-Method Investments net income	(19,000)	(110,000)
Fantasia II JV
Schedule of Equity Method Investments [Line Items]
Income from Operations	1,960,000	1,912,000
Summit interest in Equity-Method Investments net income	198,000	185,000
Fantasia III JV
Schedule of Equity Method Investments [Line Items]
Income from Operations	4,132,000	4,135,000
Summit interest in Equity-Method Investments net income	179,000	130,000
FPH JV
Schedule of Equity Method Investments [Line Items]
Income from Operations	1,681,000	1,677,000
Summit interest in Equity-Method Investments net income	(78,000)	(72,000)
Indiana JV
Schedule of Equity Method Investments [Line Items]
Income from Operations	7,447,000	6,042,000
Summit interest in Equity-Method Investments net income	(71,000)	(77,000)
Equity Method Investment, Nonconsolidated Investee or Group of Investees [Member]
Schedule of Equity Method Investments [Line Items]
Revenue	49,221,000	46,044,000
Net income	4,939,000	1,955,000
Equity Method Investment, Nonconsolidated Investee or Group of Investees [Member] | SUL JV
Schedule of Equity Method Investments [Line Items]
Revenue	18,247,000	18,295,000
Net income	3,465,000	1,284,000
Equity Method Investment, Nonconsolidated Investee or Group of Investees [Member] | Fantasia JV
Schedule of Equity Method Investments [Line Items]
Revenue	4,112,000	3,271,000
Net income	(55,000)	(315,000)
Equity Method Investment, Nonconsolidated Investee or Group of Investees [Member] | Fantasia II JV
Schedule of Equity Method Investments [Line Items]
Revenue	3,557,000	3,536,000
Net income	992,000	923,000
Equity Method Investment, Nonconsolidated Investee or Group of Investees [Member] | Fantasia III JV
Schedule of Equity Method Investments [Line Items]
Revenue	7,982,000	7,914,000
Net income	1,795,000	1,302,000
Equity Method Investment, Nonconsolidated Investee or Group of Investees [Member] | FPH JV
Schedule of Equity Method Investments [Line Items]
Revenue	3,537,000	3,564,000
Net income	(779,000)	(723,000)
Equity Method Investment, Nonconsolidated Investee or Group of Investees [Member] | Indiana JV
Schedule of Equity Method Investments [Line Items]
Revenue	11,786,000	9,464,000
Net income	$ (479,000)	$ (516,000)

Equity-Method Investments - Dis

Equity-Method Investments - Distributions receivable (Details) - USD ($)	Dec. 31, 2020	Dec. 31, 2019
Dividends Receivable	$ 1,334,000	$ 643,000
SUL JV
Dividends Receivable	466,000	97,000
Fantasia JV
Dividends Receivable	36,000	180,000
Fantasia II JV
Dividends Receivable	51,000	48,000
Fantasia III JV
Dividends Receivable	257,000	117,000
FPH JV
Dividends Receivable	26,000	39,000
Indiana JV
Dividends Receivable	$ 498,000	$ 162,000

Equity-Method Investments - Cas

Equity-Method Investments - Cash Distributions (Details) - USD ($)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Total Cash Distributions Received	$ 1,620,000	$ 1,667,000
Cash Flow from Operating Activities	648,000	443,000
Cash Flow from Investing Activities	972,000	1,224,000
SUL JV
Total Cash Distributions Received	499,000	548,000
Cash Flow from Operating Activities	346,000	128,000
Cash Flow from Investing Activities	153,000	420,000
Fantasia JV
Total Cash Distributions Received	144,000
Cash Flow from Investing Activities	144,000
Fantasia II JV
Total Cash Distributions Received	292,000	276,000
Cash Flow from Operating Activities	198,000	185,000
Cash Flow from Investing Activities	94,000	91,000
Fantasia III JV
Total Cash Distributions Received	104,000	160,000
Cash Flow from Operating Activities	104,000	130,000
Cash Flow from Investing Activities		30,000
FPH JV
Total Cash Distributions Received	152,000	306,000
Cash Flow from Operating Activities	0	0
Cash Flow from Investing Activities	152,000	306,000
Indiana JV
Total Cash Distributions Received	429,000	377,000
Cash Flow from Investing Activities	$ 429,000	$ 377,000

Equity-Method Investments - Add

Equity-Method Investments - Additional Information (Details)	Mar. 13, 2019item	Apr. 30, 2018	Dec. 31, 2020USD ($)	Dec. 31, 2019USD ($)	Dec. 31, 2017USD ($)	Apr. 30, 2015USD ($)
Membership interest			10.00%	10.00%
Equity Method Investments			$ 11,375,000	$ 13,131,000
Dividends Receivable			1,334,000	643,000
Proceeds from Dividends Received			648,000	443,000
Summit Fantasia Holdings III, LLC [Member]
Equity Method Investments			1,600,000	1,600,000
Indiana JV
Dividends Receivable			498,000	162,000
SUL JV acquired [Member]
Proceeds from Dividends Received			173,000		$ 178,000
Summit Fantasia ll Holdings LLC [Member]
Equity Method Investments			1,400,000	1,500,000
Summit Fantasia ll Holdings LLC [Member] | Acquisition and Asset Management Fees
Equity Method Investments			$ 1,300,000	1,200,000
Summit Fantasia Holdings III, LLC [Member]
Percentage of interest in annual return			9.00%
Indiana JV
Membership interest	15.00%
Membership interest acquired	15.00%
Number of skilled nursing facilities | item	14
Aggregate purchase price			$ 128,700,000
Equity Method Investments			$ 3,500,000	4,300,000
Operating Partnership [Member]
Net Operating Cash Flows, Percentage of Interest		50.00%
Capital Proceeds, Percentage of Interest		50.00%
Summit Union Life Holdings, LLC [Member]
Minimum percentage of interest in annual return			9.00%
Percentage of interest in annual return			10.00%
Equity Method Investments			$ 2,700,000	3,100,000
Summit Union Life Holdings, LLC [Member] | Operating Partnership [Member]
Net Operating Cash Flows, Percentage of Interest			25.00%
Capital Proceeds, Percentage of Interest			25.00%
Summit Fantasia Holdings LLC
Percentage of interest in annual return		8.00%
Equity Method Investments			$ 2,000,000	2,100,000
Summit Fantasia Holdings LLC | Operating Partnership [Member]
Net Operating Cash Flows, Percentage of Interest		50.00%
Capital Proceeds, Percentage of Interest		50.00%
Summit Fantasia ll Holdings LLC [Member]
Percentage of interest in annual return			8.00%
Summit Fantasia ll Holdings LLC [Member] | Fantasia Investment III LLC [Member]
Net Operating Cash Flows, Percentage of Interest			70.00%
Capital Proceeds, Percentage of Interest			70.00%
Summit Fantasia ll Holdings LLC [Member] | Operating Partnership [Member]
Net Operating Cash Flows, Percentage of Interest			30.00%
Capital Proceeds, Percentage of Interest			30.00%
Summit Fantasia Holdings III, LLC [Member]
Percentage of interest in annual return			9.00%
Summit Fantasia Holdings III, LLC [Member] | Fantasia Investment III LLC [Member]
Net Operating Cash Flows, Percentage of Interest			75.00%
Capital Proceeds, Percentage of Interest			75.00%
Summit Fantasia Holdings III, LLC [Member] | Operating Partnership [Member]
Net Operating Cash Flows, Percentage of Interest			25.00%
Capital Proceeds, Percentage of Interest			25.00%
Summit Fantasy Pearl Holdings, LLC [Member]
Percentage of interest in annual return			9.00%
Equity Method Investments			$ 200,000	500,000
Summit Fantasy Pearl Holdings, LLC [Member] | Fantasia Investment III LLC [Member]
Net Operating Cash Flows, Percentage of Interest			7.25%
Capital Proceeds, Percentage of Interest			7.25%
Summit Fantasy Pearl Holdings, LLC [Member] | Summit Fantasy Pearl Holdings, LLC- Equity-Method Investment
Net Operating Cash Flows, Percentage of Interest			65.25%
Capital Proceeds, Percentage of Interest			65.25%
Summit Fantasy Pearl Holdings, LLC [Member] | Atlantis [Member]
Net Operating Cash Flows, Percentage of Interest			7.50%
Capital Proceeds, Percentage of Interest			7.50%
Summit Fantasy Pearl Holdings, LLC [Member] | Operating Partnership [Member]
Net Operating Cash Flows, Percentage of Interest			20.00%
Capital Proceeds, Percentage of Interest			20.00%
Best Years Llc [Member] | Summit Union Life Holdings, LLC [Member]
Net Operating Cash Flows, Percentage of Interest			75.00%
Capital Proceeds, Percentage of Interest			75.00%
JV 2 Properties [Member]
Dividends Receivable			$ 11,000	$ 184,000		$ 362,000
Minimum [Member] | Best Years Llc [Member]
Membership interest			9.00%
Maximum [Member] | Best Years Llc [Member]
Membership interest			10.00%

Receivables (Details)

Receivables (Details) - USD ($)	Dec. 31, 2020	Dec. 31, 2019
Receivables
Straight-line rent receivables	$ 2,772,000	$ 2,546,000
Distribution receivables from Equity-Method Investments	1,334,000	643,000
Receivable from JV 2 properties	11,000	184,000
Asset management fees	432,000	430,000
Other receivables	128,000	9,000
Total	$ 4,677,000	$ 3,812,000

Receivables - Additional Inform

Receivables - Additional Information (Details) - USD ($)	Jan. 01, 2018	Dec. 31, 2020	Dec. 31, 2019
Accounts, Notes, Loans and Financing Receivable [Line Items]
Receivable with Imputed Interest, Effective Yield (Interest Rate)		4.25%
Debt Instrument, Frequency of Periodic Payment	$22,000
Receivable with Imputed Interest, Face Amount	$ 1,100,000
Accounts and Notes Receivable, Net		$ 200,000	$ 500,000
Friendswood TRS [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Receivable with Imputed Interest, Discount		$ 95,000

Related Party Transactions - Re

Related Party Transactions - Receivables and Reserves (Details) - Cornerstone Realty Advisors, LLC [Member]	Dec. 31, 2020USD ($)
Receivables	$ 2,676,000
Reserves	(2,676,000)
Balance	0
Organizational and offering costs [Member]
Receivables	738,000
Reserves	(738,000)
Balance	0
Asset management fees and expenses [Member]
Receivables	32,000
Reserves	(32,000)
Balance	0
Operating expenses (direct and indirect) [Member]
Receivables	189,000
Reserves	(189,000)
Balance	0
Operating expenses (2%/25% Test) [Member]
Receivables	1,717,000
Reserves	(1,717,000)
Balance	$ 0

Related Party Transactions - Ad

Related Party Transactions - Additional Information (Details)	12 Months Ended
	Dec. 31, 2020
Minimum [Member]
Related Party Transaction [Line Items]
Percentage Of Restricted Operating Expenses	2.00%
Maximum [Member]
Related Party Transaction [Line Items]
Percentage Of Restricted Operating Expenses	25.00%

Concentration of Risk (Details)

Concentration of Risk (Details) - item	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Concentration Risk [Line Items]
Concentration Risk, Percentage	10.00%	10.00%
Number of leased real estate properties	7	7
Number of tenants	5	5
Number of tenants had rental revenue greater than 10%	4	4
Number of tenants that constitutes significant asset concentration	0	1
Tenant One, Concentration Risk [Member]
Concentration Risk [Line Items]
Concentration Risk, Percentage	35.00%	32.00%
Tenant Two, Concentration Risk [Member]
Concentration Risk [Line Items]
Concentration Risk, Percentage	24.00%	22.00%
Tenant Three, Concentration Risk [Member]
Concentration Risk [Line Items]
Concentration Risk, Percentage	20.00%	18.00%
Tenant Four Concentration Risk [Member]
Concentration Risk [Line Items]
Concentration Risk, Percentage	15.00%	14.00%
Assets, Total [Member]
Concentration Risk [Line Items]
Concentration Risk, Percentage	20.00%	20.00%

Commitments and Contingencies (

Commitments and Contingencies (Details) - USD ($)	Feb. 11, 2021	Mar. 14, 2019	Dec. 31, 2020
Purchased the investors' interests			$ 900,000
Amount of monetary sanctions		$ 588,672
Subsequent Event
Amount of additional monetary sanction	$ 189,645

Equity - Black-Scholes option-p

Equity - Black-Scholes option-pricing model (Details)	12 Months Ended
	Dec. 31, 2020$ / sharesshares
Equity
Stock options granted | shares	45,000
Expected volatility	22.31%
Expected term	5 years 9 months
Risk-free interest rate	1.72%
Dividend yield	0.00%
Fair value per stock option | $ / shares	$ 0.57

Equity - Stock options (Details

Equity - Stock options (Details)	12 Months Ended
	Dec. 31, 2020USD ($)$ / sharesshares
Equity
Options outstanding, Beginning Balance	1,826,908
Granted	45,000
Exercised	0
Options outstanding, Ending Balance	1,871,908
Options exercisable, Ending Balance	1,729,876
Weighted Average Exercise Price, Outstanding at Beginning Balance | $ / shares	$ 2.09
Weighted Average Exercise Price, Granted | $ / shares	2.26
Weighted Average Exercise Price, Outstanding at Ending Balance | $ / shares	2.09
Weighted Average Exercise Price, Exercisable at Ending Balance | $ / shares	$ 2.07
Options outstanding, Weighted Average Remaining Contractual Term	6 years 9 months 22 days
Options exercisable, Weighted Average Remaining Contractual Term	6 years 8 months 9 days
Options outstanding, Aggregate Intrinsic Value | $	$ 1,524,000
Options exercisable, Aggregate Intrinsic Value | $	$ 1,433,000

Equity - Unrecognized stock-bas

Equity - Unrecognized stock-based compensation expense (Details)	Dec. 31, 2020USD ($)
Schedule of Equity Method Investments [Line Items]
Unrecognized stock-based compensation expense related to unvested stock options, net of forfeitures	$ 82,000
2021
Schedule of Equity Method Investments [Line Items]
Unrecognized stock-based compensation expense related to unvested stock options, net of forfeitures	66,000
2022
Schedule of Equity Method Investments [Line Items]
Unrecognized stock-based compensation expense related to unvested stock options, net of forfeitures	15,000
2023
Schedule of Equity Method Investments [Line Items]
Unrecognized stock-based compensation expense related to unvested stock options, net of forfeitures	$ 1,000

Equity - Additional Information

Equity - Additional Information (Details) - USD ($)	Jan. 01, 2020	Dec. 31, 2020	Dec. 31, 2019
Schedule of Equity [Line Items]
Granted		45,000
Common stock, shares authorized		290,000,000	290,000,000
Common stock, par value (in dollars per share)		$ 0.001	$ 0.001
Preferred Stock, Shares Authorized		10,000,000	10,000,000
Preferred Stock, Par or Stated Value Per Share		$ 0.001	$ 0.001
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value		$ 0.57
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Remaining Contractual Term		6 years 9 months 22 days
General and Administrative Expense [Member]
Schedule of Equity [Line Items]
Allocated Share-based Compensation Expense		$ 151,000	$ 234,000
Share-based Payment Arrangement, Employee [Member]
Schedule of Equity [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value		$ 0.58
Omnibus Incentive Plan [Member]
Schedule of Equity [Line Items]
Granted	45,000
Common Stock, Capital Shares Reserved for Future Issuance		1,128,092
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Remaining Contractual Term	10 years
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant		3,000,000

Dispositions (Details)

Dispositions (Details) - USD ($)	1 Months Ended	12 Months Ended
	Feb. 14, 2019	Dec. 31, 2019	Dec. 31, 2020	Feb. 15, 2019
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Equity method investment, ownership percentage		10.00%	10.00%
Total consideration received	$ 27,000,000
Transaction Costs Related To Prepayment Penalty	$ 1,200,000
Liabilities		$ 48,745,000	$ 48,468,000
HPShelby LLC [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Equity method investment, ownership percentage	95.00%
North Carolina Properties [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Gain on sale of properties		$ 4,300,000
Total assets of NC properties				$ 22,100,000
Liabilities				19,500,000
Loan payable disposition of properties				$ 19,400,000

Earnings Per Share (Details)

Earnings Per Share (Details) - USD ($)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Numerator:
(Loss) income from continuing operations	$ (557,000)	$ 3,030,000
(Loss) income from continuing operations attributable to noncontrolling interest	(56,000)	83,000
Net (loss) income applicable to common stockholders	$ (613,000)	$ 3,113,000
Basic:
Denominator for basic EPS - weighted average shares	23,027,978	23,027,978
Effect of dilutive shares:
Stock options	0	478,500
Denominator for diluted EPS - adjusted weighted average shares	23,027,978	23,506,478
Basic EPS	$ (0.03)	$ 0.14
Diluted EPS	$ (0.03)	$ 0.13