Document and Entity Information
Document and Entity Information - shares shares in Millions | 3 Months Ended | |
Mar. 31, 2020 | May 11, 2020 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2020 | |
Entity Registrant Name | Lightstone Value Plus Real Estate Investment Trust V, Inc. | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 20.2 | |
Entity Central Index Key | 0001387061 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Investment property: | ||
Land and improvements | $ 63,190 | $ 55,888 |
Building and improvements | 244,663 | 207,867 |
Furniture, fixtures and equipment | 5,788 | 5,561 |
Gross investment property | 313,641 | 269,316 |
Less accumulated depreciation | (42,645) | (40,230) |
Net investment property | 270,996 | 229,086 |
Cash and cash equivalents | 19,213 | 15,640 |
Marketable securities, available for sale | 5,510 | 5,496 |
Restricted cash | 4,635 | 3,932 |
Note receivable, net | 11,500 | 10,423 |
Prepaid expenses and other assets | 1,835 | 1,238 |
Assets held for sale | 22,407 | 40,807 |
Total Assets | 336,096 | 306,622 |
Liabilities and Stockholders' Equity | ||
Notes payable, net | 213,148 | 183,788 |
Advance from advisor | 10,052 | |
Accounts payable and accrued and other liabilities | 3,563 | 3,488 |
Payables to related parties | 303 | 6 |
Accrued property tax | 2,201 | 2,326 |
Liabilities held for sale | 483 | 13,915 |
Total liabilities | 229,750 | 203,523 |
Commitments and Contingencies | ||
Stockholders' Equity: | ||
Preferred stock, $.0001 par value per share; 50.0 million shares authorized, none issued and outstanding | 0 | 0 |
Convertible stock, $.0001 par value per share; 1,000 shares authorized, issued and outstanding | 0 | 0 |
Common stock, $.0001 par value per share; 350.0 million shares authorized, 22.2 million and 23.4 million shares issued and outstanding, respectively | 2 | 2 |
Additional paid-in-capital | 204,841 | 204,912 |
Accumulated other comprehensive income | 77 | 111 |
Accumulated deficit | (98,423) | (102,404) |
Total Company stockholders' equity | 106,497 | 102,621 |
Noncontrolling interests | (151) | 478 |
Total Stockholder's Equity | 106,346 | 103,099 |
Total Liabilities and Stockholders' Equity | $ 336,096 | $ 306,622 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2020 | Dec. 31, 2019 |
Consolidated Balance Sheets | ||
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Convertible stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Convertible stock, shares authorized (in shares) | 1,000 | 1,000 |
Convertible Stock Shares Issued (in share) | 1,000 | 1,000 |
Convertible stock, shares outstanding (in shares) | 1,000 | 1,000 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 350,000,000 | 350,000,000 |
Common stock, shares issued (in shares) | 22,200,000 | 23,400,000 |
Common stock, shares outstanding (in shares) | 22,200,000 | 23,400,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Consolidated Statements of Operations and Comprehensive Loss | ||
Rental revenues | $ 9,400 | $ 8,533 |
Expenses | ||
Property operating expenses | 2,960 | 2,789 |
Real estate taxes | 1,218 | 1,190 |
General and administrative | 1,539 | 1,483 |
Depreciation and amortization | 2,511 | 3,100 |
Total operating expenses | 8,228 | 8,562 |
Operating income/(loss) | 1,172 | (29) |
Interest expense, net | (2,140) | (1,987) |
Interest income | 487 | 245 |
Gain on sale of investment property | 5,474 | 0 |
Other income, net | 199 | 65 |
Net income/(loss) | 5,192 | (1,706) |
Net (income)/ loss attributable to noncontrolling interests | (1,211) | 13 |
Net income/(loss) attributable to the Company's shares | $ 3,981 | $ (1,693) |
Weighted average shares outstanding: | ||
Basic and diluted | 22,223 | 23,431 |
Basic and diluted income/(loss) per share | $ 0.18 | $ (0.07) |
Comprehensive income/(loss): | ||
Net income/(loss) | $ 5,192 | $ (1,706) |
Other comprehensive (loss)/income: | ||
Holding (loss)/gain on marketable securities, available for sale | (28) | 168 |
Reclassification adjustment for (gain)/loss included in net income/(loss) | (6) | 52 |
Total other comprehensive (loss)/income | (34) | 220 |
Comprehensive income/(loss): | 5,158 | (1,486) |
Comprehensive (income)/loss attributable to noncontrolling interest | (1,211) | 13 |
Comprehensive income/(loss) attributable to the Company's shares | $ 3,947 | $ (1,473) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands | Convertible Stock | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive (Loss)/Income | Accumulated Deficit | Noncontrolling Interests | Total |
BALANCE at Dec. 31, 2018 | $ 2 | $ 214,537 | $ (217) | $ (95,295) | $ 794 | $ 119,821 | |
BALANCE (in shares) at Dec. 31, 2018 | 1 | 23,432 | |||||
Net loss | (1,693) | (13) | (1,706) | ||||
Distributions to noncontrolling interest holders | (36) | (36) | |||||
Other comprehensive loss: | |||||||
Holding gain (loss) on marketable securities, available for sale | 168 | 168 | |||||
Reclassification adjustment for gain (loss) on sale of marketable securities included in net loss | 52 | 52 | |||||
BALANCE at Mar. 31, 2019 | $ 2 | 214,537 | 3 | (96,988) | 745 | 118,299 | |
BALANCE (in shares) at Mar. 31, 2019 | 1 | 23,432 | |||||
BALANCE at Dec. 31, 2019 | $ 2 | 204,912 | 111 | (102,404) | 478 | 103,099 | |
BALANCE (in shares) at Dec. 31, 2019 | 1 | 22,223 | |||||
Net loss | 3,981 | 1,211 | 5,192 | ||||
Distributions to noncontrolling interest holders | (1,840) | (1,840) | |||||
Costs associated with redemptions of common stock | (71) | (71) | |||||
Other comprehensive loss: | |||||||
Holding gain (loss) on marketable securities, available for sale | (28) | (28) | |||||
Foreign currency translation gain/(loss) | (6) | (6) | |||||
Reclassification adjustment for gain (loss) on sale of marketable securities included in net loss | (6) | ||||||
BALANCE at Mar. 31, 2020 | $ 2 | $ 204,841 | $ 77 | $ (98,423) | $ (151) | $ 106,346 | |
BALANCE (in shares) at Mar. 31, 2020 | 1 | 22,223 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income/(loss) | $ 5,192 | $ (1,706) |
Adjustments to reconcile net income/(loss) to net cash provided by operating activities: | ||
Depreciation and amortization | 2,511 | 3,100 |
Amortization of deferred financing fees | 125 | 150 |
Gain on sale of investment property | (5,474) | 0 |
Non-cash interest income | (418) | (98) |
Other non-cash adjustments | 33 | (373) |
Changes in operating assets and liabilities: | ||
Decrease in prepaid expenses and other assets | 405 | 2,992 |
(Decrease)/increase in accounts payable and accrued and other liabilities | (879) | 1,021 |
Increase/(decrease) in payables to related parties | 297 | (297) |
Net cash provided by operating activities | 1,792 | 4,789 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchase of investment property | (45,172) | (72,427) |
Purchases of marketable securities | (566) | (1,399) |
Proceeds from sale of marketable securities | 524 | 10,893 |
Funding of note receivable, net | (659) | (5,868) |
Acquisition fee paid on note receivable | (139) | |
Proceeds from sale of investment property, net of closing costs | 23,673 | 0 |
Proceeds from disposition of investment in unconsolidated joint venture | 10,944 | |
Cash used in investing activities | (22,200) | (57,996) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from notes payable | 29,920 | 43,414 |
Payments on notes payable | (12,714) | (211) |
Proceeds from advance from advisor | 25,000 | 0 |
Payments on advance from advisor | (15,000) | 0 |
Payment of loan fees and expenses | (611) | (824) |
Costs associated with redemptions of common stock | (71) | 0 |
Distributions to noncontrolling interest holders | (1,840) | (36) |
Net cash provided by financing activities | 24,684 | 42,343 |
Net change in cash, cash equivalents and restricted cash | 4,276 | (10,864) |
Cash, cash equivalents and restricted cash, beginning of year | 19,572 | 32,652 |
Cash, cash equivalents and restricted cash, end of period | 23,848 | 21,788 |
Supplemental cash flow information for the periods indicated is as follows: | ||
Cash paid for interest | 1,967 | 401 |
Loan origination fee on note receivable | 120 | |
Capital expenditures for real estate in accrued liabilities and accounts payable | 6 | 9 |
Holding gain/loss on marketable securities, available for sale | 34 | 220 |
The following is a summary of the Company's cash, cash equivalents, and restricted cash total as presented in our statements of cash flows for the periods presented: | ||
Cash | 19,213 | 18,740 |
Restricted cash | 4,635 | 3,048 |
Total cash and restricted cash | $ 23,848 | $ 21,788 |
Business and Organization
Business and Organization | 3 Months Ended |
Mar. 31, 2020 | |
Business and Organization | |
Business and Organization | 1. Business and Organization Lightstone Value Plus Real Estate Investment Trust V, Inc., which was previously named Behringer Harvard Opportunity REIT II, Inc. prior to July 20, 2017, (which may be referred to as the “Company,” “we,” “us,” or “our”), was organized as a Maryland corporation on January 9, 2007 and has elected to be taxed, and currently qualifies, as a real estate investment trust (“REIT”) for federal income tax purposes. We were formed primarily to acquire and operate commercial real estate and real estate-related assets on an opportunistic and value-add basis. In particular, we have focused generally on acquiring commercial properties with significant possibilities for capital appreciation, such as those requiring development, redevelopment, or repositioning, those located in markets and submarkets with high growth potential, and those available from sellers who are distressed or face time-sensitive deadlines. We have acquired a wide variety of commercial properties, including office, industrial, retail, hospitality, and multifamily. We have purchased existing, income-producing properties, and newly-constructed properties. We have also invested in other real estate-related investments such as mortgage and mezzanine loans. We intend to hold the various real properties in which we have invested until such time as our board of directors determines that a sale or other disposition appears to be advantageous to achieve our investment objectives or until it appears that the objectives will not be met. We currently have one operating segment. As of March 31, 2020, we had eight real estate investments (five wholly owned properties and three properties consolidated through investments in joint ventures) and one real estate-related investment (mezzanine loan). Substantially all of our business is conducted through Lightstone REIT V OP LP, a limited partnership organized in Delaware (the “Operating Partnership”). As of March 31, 2020, our wholly-owned subsidiary, BHO II, Inc., a Delaware corporation, owned a 0.1% partnership interest in the Operating Partnership as its sole general partner. As of March 31, 2020, our wholly-owned subsidiary, BHO Business Trust II, a Maryland business trust, was the sole limited partner of the Operating Partnership and owned the remaining 99.9% interest in the Operating Partnership. Our business is managed by an external advisor and we have no employees. Effective February 10, 2017, we engaged affiliates of The Lightstone Group (“Lightstone”), LSG-BH II Advisor LLC and LSG Development Advisor LLC (collectively, the “Advisor”), to provide advisory services to us. Lightstone is majority owned by the chairman of our board of directors, David Lichtenstein. Subject to the oversight of our board of directors, our external advisor is responsible for managing our day-to-day affairs and for services related to the management of our assets. Organization In connection with our initial capitalization, we issued 22,500 shares of our common stock and 1,000 shares of our convertible stock to our previous advisor on January 19, 2007. The 1,000 shares of convertible stock were transferred to an affiliate of Lightstone on February 10, 2017 and remain outstanding as of March 31, 2020. Our common stock is not currently listed on a national securities exchange. The timing of a liquidity event for our stockholders will depend upon then prevailing market conditions. Our board of directors previously targeted June 30, 2023 as the commencement of a liquidity event, however, on January 9, 2020, our board of directors elected to extend the targeted timeline until June 30, 2028 based on their assessment of our investment objectives and liquidity options for our stockholders. We can provide no assurances as to the actual timing of the commencement of a liquidity event for our stockholders or the ultimate liquidation of the Company. We will seek stockholder approval prior to liquidating our entire portfolio. Noncontrolling Interests Noncontrolling interests represents the noncontrolling ownership interest’s proportionate share of the equity in our consolidated real estate investments. Income and losses are allocated to noncontrolling interest holders based generally on their ownership percentage. If a property reaches a defined return threshold, then it will result in distributions to noncontrolling interests which is different from the standard pro-rata allocation percentage. In certain instances, our joint venture agreements provide for liquidating distributions based on achieving certain return metrics. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2020 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Interim Unaudited Financial Information The accompanying unaudited interim consolidated financial statements and related notes should be read in conjunction with the audited consolidated financial statements and related notes as contained in the Company’s Annual Report on Form 10‑K for the fiscal year ended December 31, 2019, which was filed with the Securities and Exchange Commission (the “SEC”) on March 30, 2020. The unaudited interim consolidated financial statements include all adjustments (consisting only of normal recurring adjustments) and accruals necessary in the judgment of management for a fair presentation of the results for the periods presented. The accompanying unaudited consolidated financial statements of Lightstone Value Plus Real Estate Investment Trust V, Inc. have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10‑Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. Principles of Consolidation and Basis of Presentation Our consolidated financial statements include our accounts and the accounts of other subsidiaries over which we have control. All inter-company transactions, balances, and profits have been eliminated in consolidation. In addition, interests in entities acquired are evaluated based on applicable GAAP, and entities deemed to be variable interest entities (“VIE”) in which we are the primary beneficiary are also consolidated. If the interest in the entity is determined not to be a VIE, then the entity is evaluated for consolidation based on legal form, economic substance, and the extent to which we have control, substantive participating rights or both under the respective ownership agreement. For entities in which we have less than a controlling interest or entities which we are not deemed to be the primary beneficiary, we account for the investment using the equity method of accounting. The consolidated balance sheet as of December 31, 2019 included herein has been derived from the consolidated balance sheet included in the Company’s Annual Report on Form 10‑K. The unaudited consolidated statements of operations for interim periods are not necessarily indicative of results for the full year or any other period. Reclassifications Certain prior period amounts may have been reclassified to conform to the current year presentation. Earnings per Share The Company had no potentially dilutive securities outstanding during the periods presented. Accordingly, earnings per share is calculated by dividing net income/(loss) by the weighted-average number of shares of common stock outstanding during the applicable period. COVID-19 Pandemic The global impact of the COVID-19 pandemic has been rapidly evolving and, as cases of the illness caused by the virus have continued to be identified in additional countries, many countries, including the United States, have reacted by instituting quarantines and restrictions on travel. In addition, all the states where we operate properties and have real-estate related investments have reacted to the COVID-19 pandemic by instituting quarantines, restrictions on travel, "shelter in place" rules, restrictions on types of business that may continue to operate and/or restrictions on types of construction projects that may continue. Many states have recently announced guidelines to reduce certain of these restrictions. The Company's consolidated portfolio of properties currently consists of seven multi-family apartment complexes and one student housing complex. Despite current restrictions and mitigation strategies, the Company's multi-family properties have not yet seen any significant impact from the COVID-19 pandemic. However, the Company's student housing complex, which consists of the River Club Apartments and the Townhomes at River Club, are located in Athens, Georgia and principally serve as "off-campus" lodging for students attending the University of Georgia, which has transitioned to online instruction for the remainder of its Spring 2020 semester and its other course offerings throughout the summer. Leases for the River Club Apartments and Townhomes at River Club generally have a term of one year from August through July. The Company's student housing complex is located "off-campus" and its tenants have not been forced to vacate. However, if the current COVID-19 pandemic and related mitigation strategies extend beyond the summer, the University of Georgia may decide to continue offering only online instruction to its students in lieu of "on-campus" classes which could adversely impact leasing demand, occupancy levels and operating results of the Company's student housing complex for future periods. Additionally, the Company's note receivable relates to a development project which is subject to similar restrictions and risks. The extent to which the Company's business may be affected by the current COVID-19 pandemic will largely depend on both current and future developments, including its duration, spread and treatment, and related travel advisories and restrictions, all of which are highly uncertain and cannot be reasonably predicted. If the Company's properties and real estate-related investments are negatively impacted in future periods for an extended period because (i) tenants are unable to pay their rent, (ii) demand for its student housing complex declines, and (iii) its borrower is unable to pay scheduled debt service on the outstanding note receivable; the Company's business and financial results could be materially and adversely impacted. While the Company has implemented various cost reduction strategies, including the deferral of certain non-critical capital expenditures, there can be no assurance that these cost savings will fully mitigate the potential adverse impact of any lost revenue and income. COVID-19 Lease Modification Accounting Relief Due to the business disruptions and challenges severely affecting the global economy caused by the COVID-19 pandemic, many lessors may be required to provide rent deferrals and other lease concessions to lessees. While the lease modification guidance addresses routine changes to lease terms resulting from negotiations between the lessee and the lessor, this guidance did not contemplate concessions being so rapidly executed to address the sudden liquidity constraints of some lessees arising from the COVID-19 pandemic and restrictions intended to prevent its spread. In April 2020, the Financial Accounting Standards Board ("FASB") staff issued a question and answer document (the "Lease Modification Q&A") focused on the application of lease accounting guidance to lease concessions provided as a result of the COVID-19 pandemic. Under existing GAAP, the Company would have to determine, on a lease by lease basis, if a lease concession was the result of a new arrangement reached with the tenant (treated within the lease modification accounting framework) or if a lease concession was under the enforceable rights and obligations within the existing lease agreement (precluded from applying the lease modification accounting framework). The Lease Modification Q&A allows the Company, if certain criteria have been met, to bypass the lease by lease analysis, and instead elect to either apply the lease modification accounting framework or not, with such election applied consistently to leases with similar characteristics and similar circumstances. The Company is evaluating the impact of this policy election and has not yet concluded on whether it will apply the election. New Accounting Pronouncements In June 2016, the FASB issued new guidance which replaces the incurred loss impairment methodology currently in use with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The new guidance is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company is currently in the process of evaluating the impact the adoption of this standard will have on the Company’s consolidated financial statements. The Company has reviewed and determined that other recently issued accounting pronouncements will not have a material impact on its financial position, results of operations and cash flows, or do not apply to its current operations. |
Real Estate and Real Estate-Rel
Real Estate and Real Estate-Related Investments | 3 Months Ended |
Mar. 31, 2020 | |
Real Estate and Real Estate-Related Investments | |
Real Estate and Real Estate-Related Investments | 3. Real Estate Asset Acquisition Autumn Breeze Apartments On March 17, 2020, the Company completed the acquisition of a 280‑unit multifamily property located in Noblesville, Indiana (the “Autumn Breeze Apartments”) from an unrelated third party, for an aggregate purchase price of approximately $43.0 million, excluding closing and other related transaction costs. In connection with the acquisition, the Company paid the Advisor an aggregate of approximately $0.8 million in acquisition fees and acquisition expense reimbursements. The Company determined this acquisition was an asset acquisition and allocated the total purchase price, including acquisition fees and expenses, to the assets acquired based on their relative fair value. Approximately $7.2 million was allocated to land and improvements, $36.0 million was allocated to building and improvements, and $0.6 million was allocated to in-place lease intangibles. The capitalization rate for the acquisition of the Autumn Breeze Apartments was approximately 4.86%. The Company calculates the capitalization rate for a real property by dividing the net operating income (“NOI”) of the property by the purchase price of the property, excluding costs. For purposes of this calculation, NOI was based upon the year ended February 29, 2020. Additionally, NOI is all gross revenues from the property less all operating expenses, including property taxes and management fees but excluding depreciation. |
Note Receivable
Note Receivable | 3 Months Ended |
Mar. 31, 2020 | |
Note Receivable | |
Note Receivable | 4. Note Receivable 500 West 22nd Street Mezzanine Loan On February 28, 2019, the Company , as the lender, and an unrelated third party (the "500 West 22nd Street Mezzanine Loan Borrower"), as the borrower, entered into a loan promissory note (the “500 West 22nd Street Mezzanine Loan”) pursuant to which the Company would fund up to $12.0 million of mezzanine financing. On the same date, the Company initially funded $8.0 million of the 500 West 22nd Street Mezzanine Loan. Subsequently through March 31, 2020, the Company funded an additional $4.0 million and as a result, the 500 West 22nd Street Mezzanine Loan has been fully funded. The 500 West 22nd Street Mezzanine Loan is recorded in note receivable, net on the consolidated balance sheet. In connection with the fundings made for the 500 West 22nd Street Mezzanine Loan, our Advisor has received an aggregate of approximately $0.2 million in acquisition fees from the Company. The acquisition fees are accounted for as an addition to the carrying value of the 500 West 22nd Street Mezzanine Loan and are being amortized as a reduction to interest income over the initial term of the 500 West 22nd Street Mezzanine Loan using a straight-line method that approximates the effective interest method. The 500 West 22nd Street Mezzanine Loan is due August 31, 2021 and is collateralized by the ownership interests of the 500 West 22nd Street Mezzanine Loan Borrower. The 500 West 22nd Street Mezzanine Loan Borrower owns a parcel of land located at 500 West 22nd Street, New York, New York. The 500 West 22nd Street Mezzanine Loan bears interest at a rate of LIBOR + 11.0% per annum with a floor of 13.493% (13.493% as of March 31, 2020). The Company received an origination fee of 1.0% of the loan balance, or approximately $0.1 million, which is presented in the consolidated balance sheets as a direct deduction from the carrying value of the 500 West 22nd Street Mezzanine Loan and is being amortized to interest income, using a straight-line method that approximates the effective interest method, over the initial term of the 500 West 22nd Street Mezzanine Loan. The 500 West 22nd Street Mezzanine Loan may be extended two additional six- month periods by the 500 West 22nd Street Mezzanine Loan Borrower provided certain conditions are met, including the establishment of an additional reserve for interest and the payment of an extension fee equal to 0.25% of the outstanding loan balance. In connection with the initial funding under the 500 West 22nd Street Mezzanine Loan, the Company retained approximately $2.1 million of the proceeds to establish a reserve for interest and other items, which is presented in the consolidated balance sheets as a direct deduction from the carrying value of the 500 West 22nd Street Mezzanine Loan and are being applied against the first 8.0% of monthly interest due during the initial term of the 500 West 22nd Street Mezzanine Loan. Through March 31, 2020, approximately $0.9 million of the reserve has been recognized as interest income and the remaining balance of the reserve was approximately $1.2 million as of March 31, 2020. The additional monthly interest due above the 8.0% threshold is added to the balance of the 500 West 22nd Street Mezzanine Loan and payable at maturity. As of March 31, 2020, approximately $0.6 million of additional interest due is included in the balance of the 500 West 22nd Street Mezzanine Loan. During the three months ended March 31, 2020 and 2019, the Company recorded approximately $0.4 million and $0.1 million, respectively, of interest income related to the note receivable and as of March 31, 2020, the outstanding principal balance of the 500 West 22nd Street Mezzanine Loan was approximately $12.0 million. |
Financial Instruments
Financial Instruments | 3 Months Ended |
Mar. 31, 2020 | |
Financial Instruments | |
Financial Instruments | 5. Financial Instruments We determined the following disclosure of estimated fair values using available market information and appropriate valuation methodologies. However, considerable judgment is necessary to interpret market data and develop the related estimates of fair value. The use of different market assumptions or only estimation methodologies may have a material effect on the estimated fair value amounts. As of March 31, 2020 and December 31, 2019, management estimated that the carrying value of cash and cash equivalents, restricted cash, prepaid expenses and other assets, advance from advisor, accounts payable, accrued and other liabilities, accrued property tax and payables to related parties were at amounts that reasonably approximated their fair value based on their highly-liquid nature and short-term maturities. The carrying amount of the note receivable approximates fair value because the interest rate is variable and reflective of the market rate. The fair value of the notes payable is categorized as a Level 2 in the fair value hierarchy. The fair value was estimated using a discounted cash flow analysis valuation on the borrowing rates currently available for loans with similar terms and maturities. The fair value of the notes payable was determined by discounting the future contractual interest and principal payments by a market rate. Disclosure about fair value of financial instruments is based on pertinent information available to management as of March 31, 2020 and December 31, 2019. Carrying amounts of our notes payable and the related estimated fair value is summarized as follows: As of March 31, 2020 As of December 31, 2019 Carrying Estimated Fair Carrying Estimated Fair Amount Value Amount Value Notes payable $ 216,607 $ 226,202 $ 186,761 $ 187,304 |
Marketable Securities and Fair
Marketable Securities and Fair Value Measurements | 3 Months Ended |
Mar. 31, 2020 | |
Marketable Securities and Fair Value Measurements | |
Marketable Securities and Fair Value Measurements | 6. Marketable Securities and Fair Value Measurements Marketable Securities The following is a summary of the Company’s available for sale securities as of the dates indicated: As of March 31, 2020 Gross Unrealized Gross Unrealized Adjusted Cost Gains Losses Fair Value Debt securities: Corporate and Government Bonds $ 5,433 $ 101 $ (24) $ 5,510 As of December 31, 2019 Gross Unrealized Gross Unrealized Adjusted Cost Gains Losses Fair Value Debt securities: Corporate and Government Bonds $ 5,385 $ 113 $ (2) $ 5,496 When evaluating the investments for other-than-temporary impairment, the Company reviews factors such as the length of time and extent to which fair value has been below cost basis, the financial condition of the issuer and any changes thereto, and the Company’s intent to sell, or whether it is more likely than not it will be required to sell, the investment before recovery of the investment’s amortized cost basis. As of March 31, 2020, the Company did not recognize any impairment charges. Fair Value Measurements Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The standard describes a fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value: · Level 1 – Quoted prices in active markets for identical assets or liabilities. · Level 2 – Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. · Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The fair values of the Company’s investments in debt securities are measured using quoted prices for these investments; however, the markets for these assets are not active. As of March 31, 2020, all of the Company’s debt securities were classified as Level 2 assets and there were no transfers between the level classifications during the three months ended March 31, 2020. The following table summarizes the estimated fair value of our investments in marketable debt securities with stated contractual maturity dates, accounted for as available-for-sale securities and classified by the contractual maturity date of the securities: As of March 31, 2020 Due in 1 year $ 1,178 Due in 1 year through 5 years 4,210 Due in 5 years through 10 years 122 Due after 10 years — Total $ 5,510 |
Held for Sale and Disposition o
Held for Sale and Disposition of Gardens Medical Pavilion | 3 Months Ended |
Mar. 31, 2020 | |
Held for Sale and Disposition of Gardens Medical Pavilion | |
Held for Sale and Disposition of Gardens Medical Pavilion | 7. Held for Sale and Disposition of Gardens Medical Pavilion Gardens Medical Pavilion On December 23, 2019, the Company and CPI/AHP Garden Medical Pavilion Mob Owner, L.L.C. (the "Gardens Medical Pavilion Buyer"), an unaffiliated third party, entered into a purchase and sale agreement (the "Gardens Medical Pavilion Agreement") pursuant to which the Company would dispose of the Gardens Medical Pavilion to the Gardens Medical Pavilion Buyer for an aggregate contractual sales price of $24.3 million. As of December 31, 2019, the Gardens Medical Pavilion met the criteria to be classified as held for sale and therefore, its associated assets and liabilities are classified as held for sale in the consolidated balance sheet as of December 31, 2019. On January 15, 2020, the Company completed the disposition of the Gardens Medical Pavilion for a contractual sales price of $24.3 million. In connection with the disposition of the Gardens Medical Pavilion, the Company recognized a gain on the sale of investment property of approximately $5.5 million during the first quarter of 2020. Approximately $12.6 million of the proceeds were used towards the repayment in full of a mortgage loan secured by the Gardens Medical Pavilion. Lakes of Margate Beginning with the fourth quarter of 2019, Lakes of Margate met the criteria to be classified as held for sale and therefore, its associated assets and liabilities are classified as held for sale in the consolidated balance sheet as of March 31, 2020 and December 31, 2019. The following summary presents the major components of assets and liabilities held for sale, of as the date indicated. (amounts as of December 31, 2019 include Lakes of Margate and Gardens Medical Pavilion and amounts as of March 31, 2020 only include Lakes of Margate) As of As of March 31, 2020 December 31, 2019 Net investment property $ 22,156 $ 39,604 Other assets 251 1,203 Total assets held for sale $ 22,407 $ 40,807 Note payable, net — 12,441 Accounts payable and accrued expenses 483 1,474 Total liabilities held for sale $ 483 $ 13,915 |
Notes Payable
Notes Payable | 3 Months Ended |
Mar. 31, 2020 | |
Notes Payable | |
Notes Payable | 8. Notes Payable Notes payable consists of the following: Weighted Average Interest Rate as of Amount Due at As of As of Property Interest Rate March 31, 2020 Maturity Date Maturity March 31, 2020 December 31, 2019 River Club and the Townhomes at River Club LIBOR + 1.78% May 1, 2025 $ 28,419 $ 30,359 $ 30,359 Arbors Harbor Town 4.53% 4.53 % December 28, 2025 29,000 29,000 29,000 Parkside 4.45% 4.45 % September 1, 2025 15,782 17,514 17,588 Axis at Westmont 4.39% 4.39 % February 1, 2026 34,343 37,600 37,600 Valley Ranch Apartments 4.16% 4.16 % March 1, 2026 43,414 43,414 43,414 Flats at Fishers 3.78% 3.78 % July 1, 2026 26,090 28,800 28,800 Autumn Breeze Apartments 3.39% 3.39 % April 1, 2030 25,518 29,920 — Total notes payable 4.25 % $ 202,566 216,607 186,761 Less: Deferred financing costs (3,459) (2,973) Total notes payable, net $ 213,148 $ 183,788 On March 31, 2020, the Company entered into a ten-year $29.9 million non-recourse mortgage loan (the "Autumn Breeze Apartments Loan") scheduled to mature on April 1, 2030. The Autumn Breeze Apartments Loan bears interest at 3.39% and requires monthly interest-only payments through March 31, 2023 and monthly principal and interest payments of approximately $0.1 million thereafter, through its stated maturity. The Autumn Breeze Apartments Loan is collateralized by the Autumn Breeze Apartments. In connection with the Autumn Breeze Apartments Loan, the Company paid the Advisor an aggregate of approximately $0.3 million in financing fees. The Company’s loan agreements stipulate that it complies with certain reporting and financial covenants. The Company is currently in compliance with all of its debt covenants. The following table provides information with respect to the contractual maturities and scheduled principal repayments of our indebtedness as of March 31, 2020. 2020 2021 2022 2023 2024 Thereafter Total Principal maturities $ 225 $ 1,023 $ 1,468 $ 2,498 $ 3,181 $ 208,212 $ 216,607 Less: deferred financing costs (3,459) Total notes payable, net $ 213,148 |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2020 | |
Stockholders' Equity | |
Stockholders' Equity | 9. Stockholders’ Equity Tender Offer The Company commenced a tender offer on December 17, 2019, pursuant to which it offered to acquire up to 2.0 million shares of its common stock at a purchase price of $7.75 per share, or $15.5 million in the aggregate (the “Tender Offer”). The Tender Offer terminated on February 28, 2020, and a total of 2,183,888 shares were validly tendered and not withdrawn pursuant to the Tender Offer as of such date, an amount that exceeded the maximum number of shares the Company offered to purchase pursuant to the Tender Offer. In accordance with the terms of the Tender Offer, the Company subsequently repurchased a total of 2.0 million shares at a price of $7.75 per share for an aggregate purchase price of $15.5 million in April 2020. Because the amount of repurchase requests exceeded the maximum number of shares the Company had offered to repurchase, the Company repurchased shares on a pro-rata basis, subject to “odd lot” priority as described in the Tender Offer. Excluding the stockholders eligible for “odd lot” priority that were not be subject to proration, approximately 91.58% of the number of shares tendered by each remaining stockholder who participated in the Tender Offer were repurchased by the Company. Share Redemption Program and Redemption Price The Company’s board of directors has adopted a share redemption program (the “SRP”) that permits stockholders to sell their shares back to it, subject to the significant conditions and limitations of the program. The Company’s board of directors can amend the provisions of the SRP at any time without the approval of the stockholders. On August 9, 2017, the board of directors adopted a Fourth Amended and Restated Share Redemption Program (the “Fourth Amended SRP”) which became effective July 1, 2018. The Fourth Amended SRP established that the price at which the Company would redeem shares submitted for redemption will be a percentage of the estimated net asset value per share (“NAV per Share”) as of the Effective Date, as defined, as follows: For Redemptions with an Effective Date Between July 1, 2018 and June 30, 2019: 92.5% of the estimated NAV per Share July 1, 2019 and June 30, 2020: 95.0% of the estimated NAV per Share July 1, 2020 and June 30, 2021: 97.5% of the estimated NAV per Share Thereafter: 100% of the estimated NAV per Share Pursuant to the terms of the Fourth Amended SRP, any shares approved for redemption are redeemed on a periodic basis as determined from time to time by the Company’s board of directors, and no less frequently than annually. The Company will not redeem, during any twelve-month period, more than 5% of the weighted average number of shares outstanding during the twelve-month period immediately prior to the date of redemption. In addition, the cash available for redemptions is limited to no more than $10.0 million in any twelve-month period. Any redemption requests are honored pro rata among all requests received based on funds available and are not honored on a first come, first served basis. On December 28, 2018, the Company’s board of directors adopted a Fifth Amended and Restated Share Redemption Program (the “Fifth Amended SRP”) which became effective on January 31, 2019. The only material change to the program was to change the measurement period for the limitations on the number and dollar amount of shares that may be accepted for redemption from a rolling 12 month-period to a calendar year. In accordance with the Company’s Fifth Amended SRP, the per share redemption price automatically adjusted to $8.64 effective November 7, 2019 as a result of the determination and approval by the Company’s board of directors of the updated estimated NAV per Share. In connection with the approval of the Tender Offer on December 13, 2019, the Company’s board of directors approved the suspension of the SRP. Pursuant to the terms of the SRP, while the SRP is suspended, the Company will not accept any requests for redemption. Distributions U.S. federal tax law requires a REIT distribute at least 90% of its annual REIT taxable income (which does not equal net income, as calculated in accordance with GAAP) determined without regard to the deduction for dividends paid and excluding any net capital gain. In order to continue to qualify for REIT status, we may be required to make distributions in excess of cash available. Distributions are authorized at the discretion of our board of directors based on its analysis of our performance over the previous periods and expectations of performance for future periods. These analyses may include actual and anticipated operating cash flow, changes in market capitalization rates for investments suitable for our portfolio, capital expenditure needs, general financial and market conditions, proceeds from asset sales, and other factors that our board of directors deems relevant. Our board of director’s decisions will be substantially influenced by the obligation to ensure that we maintain our federal tax status as a REIT. We cannot provide assurance that we will pay distributions at any particular level, or at all. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2020 | |
Related Party Transactions | |
Related Party Transactions | 10. Related Party Transactions The Company has agreements with the Advisor to pay certain fees, in exchange for services performed by the Advisor and/or its affiliated entities. Amounts the Company owes to the Advisor and its affiliated entities are principally for these fees, and are classified as payables to related parties on the consolidated balance sheets. The following table represents the fees incurred associated with the payments to the Company’s Advisor for the periods indicated: For the Three Months Ended March 31, 2020 2019 Acquisition fees and acquisition expense reimbursement (1) $ 764 $ 1,369 Debt financing fees (2) 299 434 Property management fees (property operating expenses) 115 87 Administrative services reimbursement (general and administrative costs) 328 322 Asset management fees (general and administrative costs) 632 548 Total $ 2,138 $ 2,760 (1) (2) Advance from Advisor On March 16, 2020, the Advisor provided an advance of $25.0 million to the Company, of which $15.0 million was subsequently repaid on March 31, 2020. The outstanding balance bears interest at a fixed-rate of 5.00%. Approximately $0.1 million of interest was incurred on the advance during the three months ended March 31, 2020. As of March 31, 2020, the outstanding advance balance plus accrued interest totaled approximately $10.1 million and is presented as Advance from Advisor on the consolidated balance sheet. The Company currently expects to repay the Advance from Advisor with proceeds from selective asset sales and/or financing transactions. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Summary of Significant Accounting Policies | |
Interim Unaudited Financial Information | Interim Unaudited Financial Information The accompanying unaudited interim consolidated financial statements and related notes should be read in conjunction with the audited consolidated financial statements and related notes as contained in the Company’s Annual Report on Form 10‑K for the fiscal year ended December 31, 2019, which was filed with the Securities and Exchange Commission (the “SEC”) on March 30, 2020. The unaudited interim consolidated financial statements include all adjustments (consisting only of normal recurring adjustments) and accruals necessary in the judgment of management for a fair presentation of the results for the periods presented. The accompanying unaudited consolidated financial statements of Lightstone Value Plus Real Estate Investment Trust V, Inc. have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10‑Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. |
Principles of Consolidation and Basis of Presentation | Principles of Consolidation and Basis of Presentation Our consolidated financial statements include our accounts and the accounts of other subsidiaries over which we have control. All inter-company transactions, balances, and profits have been eliminated in consolidation. In addition, interests in entities acquired are evaluated based on applicable GAAP, and entities deemed to be variable interest entities (“VIE”) in which we are the primary beneficiary are also consolidated. If the interest in the entity is determined not to be a VIE, then the entity is evaluated for consolidation based on legal form, economic substance, and the extent to which we have control, substantive participating rights or both under the respective ownership agreement. For entities in which we have less than a controlling interest or entities which we are not deemed to be the primary beneficiary, we account for the investment using the equity method of accounting. The consolidated balance sheet as of December 31, 2019 included herein has been derived from the consolidated balance sheet included in the Company’s Annual Report on Form 10‑K. The unaudited consolidated statements of operations for interim periods are not necessarily indicative of results for the full year or any other period. |
Noncontrolling Interest | Noncontrolling Interests Noncontrolling interests represents the noncontrolling ownership interest’s proportionate share of the equity in our consolidated real estate investments. Income and losses are allocated to noncontrolling interest holders based generally on their ownership percentage. If a property reaches a defined return threshold, then it will result in distributions to noncontrolling interests which is different from the standard pro-rata allocation percentage. In certain instances, our joint venture agreements provide for liquidating distributions based on achieving certain return metrics. |
Reclassifications | Reclassifications Certain prior period amounts may have been reclassified to conform to the current year presentation. |
Earnings per Share | Earnings per Share The Company had no potentially dilutive securities outstanding during the periods presented. Accordingly, earnings per share is calculated by dividing net income/(loss) by the weighted-average number of shares of common stock outstanding during the applicable period. |
COVID-19 Pandemic Lease Modification Accounting Relief | COVID-19 Pandemic The global impact of the COVID-19 pandemic has been rapidly evolving and, as cases of the illness caused by the virus have continued to be identified in additional countries, many countries, including the United States, have reacted by instituting quarantines and restrictions on travel. In addition, all the states where we operate properties and have real-estate related investments have reacted to the COVID-19 pandemic by instituting quarantines, restrictions on travel, "shelter in place" rules, restrictions on types of business that may continue to operate and/or restrictions on types of construction projects that may continue. Many states have recently announced guidelines to reduce certain of these restrictions. The Company's consolidated portfolio of properties currently consists of seven multi-family apartment complexes and one student housing complex. Despite current restrictions and mitigation strategies, the Company's multi-family properties have not yet seen any significant impact from the COVID-19 pandemic. However, the Company's student housing complex, which consists of the River Club Apartments and the Townhomes at River Club, are located in Athens, Georgia and principally serve as "off-campus" lodging for students attending the University of Georgia, which has transitioned to online instruction for the remainder of its Spring 2020 semester and its other course offerings throughout the summer. Leases for the River Club Apartments and Townhomes at River Club generally have a term of one year from August through July. The Company's student housing complex is located "off-campus" and its tenants have not been forced to vacate. However, if the current COVID-19 pandemic and related mitigation strategies extend beyond the summer, the University of Georgia may decide to continue offering only online instruction to its students in lieu of "on-campus" classes which could adversely impact leasing demand, occupancy levels and operating results of the Company's student housing complex for future periods. Additionally, the Company's note receivable relates to a development project which is subject to similar restrictions and risks. The extent to which the Company's business may be affected by the current COVID-19 pandemic will largely depend on both current and future developments, including its duration, spread and treatment, and related travel advisories and restrictions, all of which are highly uncertain and cannot be reasonably predicted. If the Company's properties and real estate-related investments are negatively impacted in future periods for an extended period because (i) tenants are unable to pay their rent, (ii) demand for its student housing complex declines, and (iii) its borrower is unable to pay scheduled debt service on the outstanding note receivable; the Company's business and financial results could be materially and adversely impacted. While the Company has implemented various cost reduction strategies, including the deferral of certain non-critical capital expenditures, there can be no assurance that these cost savings will fully mitigate the potential adverse impact of any lost revenue and income. COVID-19 Lease Modification Accounting Relief Due to the business disruptions and challenges severely affecting the global economy caused by the COVID-19 pandemic, many lessors may be required to provide rent deferrals and other lease concessions to lessees. While the lease modification guidance addresses routine changes to lease terms resulting from negotiations between the lessee and the lessor, this guidance did not contemplate concessions being so rapidly executed to address the sudden liquidity constraints of some lessees arising from the COVID-19 pandemic and restrictions intended to prevent its spread. In April 2020, the Financial Accounting Standards Board ("FASB") staff issued a question and answer document (the "Lease Modification Q&A") focused on the application of lease accounting guidance to lease concessions provided as a result of the COVID-19 pandemic. Under existing GAAP, the Company would have to determine, on a lease by lease basis, if a lease concession was the result of a new arrangement reached with the tenant (treated within the lease modification accounting framework) or if a lease concession was under the enforceable rights and obligations within the existing lease agreement (precluded from applying the lease modification accounting framework). The Lease Modification Q&A allows the Company, if certain criteria have been met, to bypass the lease by lease analysis, and instead elect to either apply the lease modification accounting framework or not, with such election applied consistently to leases with similar characteristics and similar circumstances. The Company is evaluating the impact of this policy election and has not yet concluded on whether it will apply the election. |
New Accounting Pronouncements | New Accounting Pronouncements In June 2016, the FASB issued new guidance which replaces the incurred loss impairment methodology currently in use with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The new guidance is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company is currently in the process of evaluating the impact the adoption of this standard will have on the Company’s consolidated financial statements. The Company has reviewed and determined that other recently issued accounting pronouncements will not have a material impact on its financial position, results of operations and cash flows, or do not apply to its current operations. |
Financial Instruments (Tables)
Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Financial Instruments | |
Schedule of Notes payable and the related estimated fair value | Carrying amounts of our notes payable and the related estimated fair value is summarized as follows: As of March 31, 2020 As of December 31, 2019 Carrying Estimated Fair Carrying Estimated Fair Amount Value Amount Value Notes payable $ 216,607 $ 226,202 $ 186,761 $ 187,304 |
Marketable Securities and Fai_2
Marketable Securities and Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Marketable Securities and Fair Value Measurements | |
Schedule of available-for-sale securities reconciliation | The following is a summary of the Company’s available for sale securities as of the dates indicated: As of March 31, 2020 Gross Unrealized Gross Unrealized Adjusted Cost Gains Losses Fair Value Debt securities: Corporate and Government Bonds $ 5,433 $ 101 $ (24) $ 5,510 As of December 31, 2019 Gross Unrealized Gross Unrealized Adjusted Cost Gains Losses Fair Value Debt securities: Corporate and Government Bonds $ 5,385 $ 113 $ (2) $ 5,496 |
Schedule of available-for-sale securities | The following table summarizes the estimated fair value of our investments in marketable debt securities with stated contractual maturity dates, accounted for as available-for-sale securities and classified by the contractual maturity date of the securities: As of March 31, 2020 Due in 1 year $ 1,178 Due in 1 year through 5 years 4,210 Due in 5 years through 10 years 122 Due after 10 years — Total $ 5,510 |
Held for Sale and Disposition_2
Held for Sale and Disposition of Gardens Medical Pavilion (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Held for Sale and Disposition of Gardens Medical Pavilion | |
Schedule of components of assets and liabilities held for sale | The following summary presents the major components of assets and liabilities held for sale, of as the date indicated. (amounts as of December 31, 2019 include Lakes of Margate and Gardens Medical Pavilion and amounts as of March 31, 2020 only include Lakes of Margate) As of As of March 31, 2020 December 31, 2019 Net investment property $ 22,156 $ 39,604 Other assets 251 1,203 Total assets held for sale $ 22,407 $ 40,807 Note payable, net — 12,441 Accounts payable and accrued expenses 483 1,474 Total liabilities held for sale $ 483 $ 13,915 |
Notes Payable (Tables)
Notes Payable (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Notes Payable | |
Schedule of information on notes payable | Notes payable consists of the following: Weighted Average Interest Rate as of Amount Due at As of As of Property Interest Rate March 31, 2020 Maturity Date Maturity March 31, 2020 December 31, 2019 River Club and the Townhomes at River Club LIBOR + 1.78% May 1, 2025 $ 28,419 $ 30,359 $ 30,359 Arbors Harbor Town 4.53% 4.53 % December 28, 2025 29,000 29,000 29,000 Parkside 4.45% 4.45 % September 1, 2025 15,782 17,514 17,588 Axis at Westmont 4.39% 4.39 % February 1, 2026 34,343 37,600 37,600 Valley Ranch Apartments 4.16% 4.16 % March 1, 2026 43,414 43,414 43,414 Flats at Fishers 3.78% 3.78 % July 1, 2026 26,090 28,800 28,800 Autumn Breeze Apartments 3.39% 3.39 % April 1, 2030 25,518 29,920 — Total notes payable 4.25 % $ 202,566 216,607 186,761 Less: Deferred financing costs (3,459) (2,973) Total notes payable, net $ 213,148 $ 183,788 |
Schedule of contractual obligations for principal payments | The following table provides information with respect to the contractual maturities and scheduled principal repayments of our indebtedness as of March 31, 2020. 2020 2021 2022 2023 2024 Thereafter Total Principal maturities $ 225 $ 1,023 $ 1,468 $ 2,498 $ 3,181 $ 208,212 $ 216,607 Less: deferred financing costs (3,459) Total notes payable, net $ 213,148 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Stockholders' Equity | |
Schedule of Redemption Program | The Fourth Amended SRP established that the price at which the Company would redeem shares submitted for redemption will be a percentage of the estimated net asset value per share (“NAV per Share”) as of the Effective Date, as defined, as follows: For Redemptions with an Effective Date Between July 1, 2018 and June 30, 2019: 92.5% of the estimated NAV per Share July 1, 2019 and June 30, 2020: 95.0% of the estimated NAV per Share July 1, 2020 and June 30, 2021: 97.5% of the estimated NAV per Share Thereafter: 100% of the estimated NAV per Share |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Related Party Transactions | |
Schedule of fees incurred associated with the payments to the Company's Advisor | The following table represents the fees incurred associated with the payments to the Company’s Advisor for the periods indicated: For the Three Months Ended March 31, 2020 2019 Acquisition fees and acquisition expense reimbursement (1) $ 764 $ 1,369 Debt financing fees (2) 299 434 Property management fees (property operating expenses) 115 87 Administrative services reimbursement (general and administrative costs) 328 322 Asset management fees (general and administrative costs) 632 548 Total $ 2,138 $ 2,760 (1) (2) |
Business and Organization - Add
Business and Organization - Additional Information (Details) - shares | 3 Months Ended | ||
Mar. 31, 2020 | Dec. 31, 2019 | Jan. 19, 2007 | |
Organization | |||
Common stock, shares issued (in shares) | 22,200,000 | 23,400,000 | |
Convertible stock issued (in shares) | 1,000 | 1,000 | |
Maryland [Member] | |||
Organization | |||
Percentage of remaining ownership interest held by BHO Business Trust II | 99.90% | ||
Behringer Harvard Opportunity OP II LP | |||
Organization | |||
Percentage of ownership interest by BHO II, Inc | 0.10% | ||
Initial Capitalization | Behringer Harvard Holdings | |||
Organization | |||
Common stock, shares issued (in shares) | 22,500 | ||
Convertible stock issued (in shares) | 1,000 |
Real Estate Asset Acquisition (
Real Estate Asset Acquisition (Details) - USD ($) $ in Millions | Mar. 17, 2020 | Feb. 29, 2020 |
Land and Improvements | ||
Real Estate Properties [Line Items] | ||
Business Combination, Consideration Transferred | $ 7.2 | |
Building and Building Improvements [Member] | ||
Real Estate Properties [Line Items] | ||
Business Combination, Consideration Transferred | 36 | |
Other Assets [Member] | ||
Real Estate Properties [Line Items] | ||
Business Combination, Consideration Transferred | 0.6 | |
Autumn Breeze Apartments | ||
Real Estate Properties [Line Items] | ||
Business Combination, Consideration Transferred | 43 | |
Business Combination, Acquisition Related Costs | $ 0.8 | |
Capitalization Rate | 4.86% |
Note Receivable (Details)
Note Receivable (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | ||
Feb. 28, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Payments to Acquire Notes Receivable | $ 659 | $ 5,868 | ||
Note receivable | 11,500 | $ 10,423 | ||
Mezzanine Loan Promissory Note [Member] | ||||
Debt Instrument, Face Amount | $ 12,000 | 600 | ||
Payments to Acquire Notes Receivable | $ 8,000 | 4,000 | ||
Debt Instrument, Unfunded | 900 | |||
Payments for Merger Related Costs | $ 200 | |||
Debt Instrument, Description of Variable Rate Basis | LIBOR + 11.0 | |||
Debt Instrument, Basis Spread on Variable Rate | 11.00% | 13.493% | ||
Debt Instrument Origination Fees Description | The Company received an origination fee of 1.0% of the loan balance, or approximately $0.1 million | |||
Debt Instrument Extension Fee Percentage | 0.25% | |||
Debt Instrument, Maturity Date | Aug. 31, 2021 | |||
Interest Reserve On Notes Receivable | $ 2,100 | $ 1,200 | ||
Utilization Of Interest Reserve Percentage On Interest Due | 8.00% | 8.00% | ||
Investment Income, Interest | $ 400 | $ 100 | ||
Note receivable | $ 12,000 |
Financial Instruments (Details)
Financial Instruments (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Financial Instruments | ||
Notes payable, Carrying Amount | $ 216,607 | $ 186,761 |
Notes payable, Estimated Fair Value | $ 226,202 | $ 187,304 |
Marketable Securities and Fai_3
Marketable Securities and Fair Value Measurements - Available for Sale Securities (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2020 | Dec. 31, 2019 | |
Fair Value | $ 5,510 | $ 5,496 |
Corporate and Government Bonds | ||
Adjusted Cost | 5,433 | 5,385 |
Gross Unrealized Gains | 101 | 113 |
Gross Unrealized Losses | (24) | (2) |
Fair Value | $ 5,510 | $ 5,496 |
Marketable Securities and Fai_4
Marketable Securities and Fair Value Measurements - Summarizes the Estimated Fair Value of our Investments in Marketable Debt Securities (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Marketable Securities and Fair Value Measurements | ||
Due in 1 year | $ 1,178 | |
Due in 1 year through 5 years | 4,210 | |
Due in 5 years through 10 years | 122 | |
Due after 10 years | 0 | |
Total | $ 5,510 | $ 5,496 |
Held for Sale and Disposition_3
Held for Sale and Disposition of Gardens Medical Pavilion (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Total assets held for sale | $ 22,407 | $ 40,807 |
Total liabilities held for sale | 483 | 13,915 |
Lakes of Margate | Held for sale | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Net investment property | 22,156 | 39,604 |
Other assets | 251 | 1,203 |
Total assets held for sale | 22,407 | 40,807 |
Note payable, net | 12,441 | |
Accounts payable and accrued expenses | 483 | 1,474 |
Total liabilities held for sale | $ 483 | $ 13,915 |
Held for Sale and Disposition_4
Held for Sale and Disposition of Gardens Medical Pavilion - Additional Information (Details) - USD ($) $ in Thousands | Jan. 15, 2020 | Mar. 31, 2020 | Mar. 31, 2019 | Dec. 23, 2019 |
Held for Sale and Disposition of Gardens Medical Pavilion | ||||
Disposal Group, Not Discontinued Operation, Gain (Loss) on Disposal | $ 5,474 | $ 0 | ||
Gardens Medical Pavilion | Disposed of by sale | ||||
Held for Sale and Disposition of Gardens Medical Pavilion | ||||
Contractual sale price | $ 24,300 | |||
Aggregate contractual value | $ 24,300 | |||
Disposal Group, Not Discontinued Operation, Gain (Loss) on Disposal | $ 5,500 | |||
Disposal Group, Including Discontinued Operation, Proceeds Utilized To Repay Mortgage Loan | $ 12,600 |
Notes Payable - Information on
Notes Payable - Information on Notes Payable (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Debt Instrument [Line Items] | ||
Long-term Debt | $ 213,148 | |
Less: deferred financing costs | (3,459) | |
Total notes payable, net | $ 213,148 | $ 183,788 |
Notes payable | ||
Debt Instrument [Line Items] | ||
Weighted Average Interest Rate | 4.25% | |
Long-term Debt | $ 202,566 | |
Total notes payable | 216,607 | 186,761 |
Less: deferred financing costs | $ (3,459) | (2,973) |
River Club and the Townhomes at River Club | Notes payable | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Interest Rate | LIBOR + 1.78% | |
Debt Instrument, Maturity Date | May 1, 2025 | |
Long-term Debt | $ 28,419 | |
Total notes payable | $ 30,359 | 30,359 |
Arbors Harbor Town | Notes payable | ||
Debt Instrument [Line Items] | ||
Interest rate (as a percent) | 4.53% | |
Weighted Average Interest Rate | 4.53% | |
Debt Instrument, Maturity Date | Dec. 28, 2025 | |
Long-term Debt | $ 29,000 | |
Total notes payable | $ 29,000 | 29,000 |
Parkside | Notes payable | ||
Debt Instrument [Line Items] | ||
Interest rate (as a percent) | 4.45% | |
Weighted Average Interest Rate | 4.45% | |
Debt Instrument, Maturity Date | Sep. 1, 2025 | |
Long-term Debt | $ 15,782 | |
Total notes payable | $ 17,514 | 17,588 |
Axis at Westmont | Notes payable | ||
Debt Instrument [Line Items] | ||
Interest rate (as a percent) | 4.39% | |
Weighted Average Interest Rate | 4.39% | |
Debt Instrument, Maturity Date | Feb. 1, 2026 | |
Long-term Debt | $ 34,343 | |
Total notes payable | $ 37,600 | 37,600 |
Valley Ranch Apartments | Notes payable | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Interest Rate | 4.16% | |
Weighted Average Interest Rate | 4.16% | |
Debt Instrument, Maturity Date | Mar. 1, 2026 | |
Long-term Debt | $ 43,414 | |
Total notes payable | $ 43,414 | 43,414 |
Flats at Fishers | Notes payable | ||
Debt Instrument [Line Items] | ||
Interest rate (as a percent) | 3.78% | |
Weighted Average Interest Rate | 3.78% | |
Debt Instrument, Maturity Date | Jul. 1, 2026 | |
Long-term Debt | $ 26,090 | |
Total notes payable | $ 28,800 | 28,800 |
Autumn Breeze Apartments | Notes payable | ||
Debt Instrument [Line Items] | ||
Interest rate (as a percent) | 3.39% | |
Weighted Average Interest Rate | 3.39% | |
Debt Instrument, Maturity Date | Apr. 1, 2030 | |
Long-term Debt | $ 25,518 | |
Total notes payable | $ 29,920 | $ 0 |
Notes Payable - Contractual Obl
Notes Payable - Contractual Obligations for Principal Payments (Details) $ in Thousands | Mar. 31, 2020USD ($) |
Notes Payable | |
2020 | $ 225 |
2021 | 1,023 |
2022 | 1,468 |
2023 | 2,498 |
2024 | 3,181 |
Thereafter | 208,212 |
Total principal maturities | 216,607 |
Less: deferred financing costs | (3,459) |
Total notes payable, net | $ 213,148 |
Notes Payable - Additional Info
Notes Payable - Additional Information (Details) - Autumn Breeze Apartment Loan [Member] $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Debt Instrument [Line Items] | |
Total notes payable | $ 29.9 |
Debt Instrument, Basis Spread on Variable Rate | 3.39% |
Line of Credit Facility, Periodic Payment | $ 0.1 |
Debt Instrument, Fee Amount | $ 0.3 |
Stockholders' Equity - Summary
Stockholders' Equity - Summary of Estimated Net Asset Value Per Share as of Effective Date (Details) | Mar. 31, 2020 |
July 1, 2018 and June 30, 2019 [Member] | |
Share Redemption Program, Redemption Price, Percentage of Share Price | 92.50% |
July 1, 2019 and June 30, 2020 [Member] | |
Share Redemption Program, Redemption Price, Percentage of Share Price | 95.00% |
July 1, 2020 and June 30, 2021 [Member] | |
Share Redemption Program, Redemption Price, Percentage of Share Price | 97.50% |
Thereafter [Member] | |
Share Redemption Program, Redemption Price, Percentage of Share Price | 100.00% |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | Dec. 17, 2019 | Dec. 28, 2018 | Apr. 30, 2020 | Mar. 31, 2020 | Feb. 29, 2020 | Dec. 31, 2019 |
Class of Stock [Line Items] | ||||||
Number of shares offered in a tender | 2,000,000 | |||||
Common stock, par value (in dollars per share) | $ 7.75 | $ 0.0001 | $ 0.0001 | |||
Aggregate value | $ 15.5 | |||||
Number of shares validly tendered in the offer | 2,183,888 | |||||
Share repurchase program, cash available for redemption | $ 10 | |||||
Share redemption program, annual limitation, percentage of weighted average shares outstanding | 5.00% | |||||
Percentage of real estate investment trust taxable income | 90.00% | |||||
Treasury Stock Acquired, Average Cost Per Share | $ 8.64 | |||||
Percentage of shares repurchased | 91.58% | |||||
Tender Offer [Member] | ||||||
Class of Stock [Line Items] | ||||||
Common stock, par value (in dollars per share) | $ 7.75 | |||||
Aggregate value | $ 15.5 | |||||
Common stock redeemed (in shares) | 2,000,000 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 16, 2020 | |
Related party transaction | |||
Advance from advisor | $ 10,052 | ||
Advisor | |||
Related party transaction | |||
Total | 2,138 | $ 2,760 | |
Advisor | Loans from related party | |||
Related party transaction | |||
Loans from related party | $ 25,000 | ||
Repayment | $ 15,000 | ||
Interest rate (as a percent) | 5.00% | ||
Interest on loan | $ 100 | ||
Advisor | Acquisition fees and acquisition expense reimbursement | |||
Related party transaction | |||
Total | 764 | 1,369 | |
Advisor | Debt financing fees | |||
Related party transaction | |||
Total | 299 | 434 | |
Advisor | Property management fees (property operating expenses) | |||
Related party transaction | |||
Total | 115 | 87 | |
Advisor | Administrative services reimbursement (general and administrative costs) | |||
Related party transaction | |||
Total | 328 | 322 | |
Advisor | Asset management fees (general and administrative costs) | |||
Related party transaction | |||
Total | $ 632 | $ 548 |
Uncategorized Items - ivpc-2020
Label | Element | Value |
Stock Redeemed or Called During Period, Value | us-gaap_StockRedeemedOrCalledDuringPeriodValue | $ 0 |
Convertible Stock [Member] | ||
Stock Redeemed or Called During Period, Value | us-gaap_StockRedeemedOrCalledDuringPeriodValue | $ 0 |
Stock Redeemed or Called During Period, Shares | us-gaap_StockRedeemedOrCalledDuringPeriodShares | 0 |
Additional Paid In Capital [Member] | ||
Stock Redeemed or Called During Period, Value | us-gaap_StockRedeemedOrCalledDuringPeriodValue | $ 0 |
Retained Earnings [Member] | ||
Stock Redeemed or Called During Period, Value | us-gaap_StockRedeemedOrCalledDuringPeriodValue | 0 |
Common Stock [Member] | ||
Stock Redeemed or Called During Period, Value | us-gaap_StockRedeemedOrCalledDuringPeriodValue | $ 0 |
Stock Redeemed or Called During Period, Shares | us-gaap_StockRedeemedOrCalledDuringPeriodShares | 0 |
Accumulated Other Comprehensive Income [Member] | ||
Stock Redeemed or Called During Period, Value | us-gaap_StockRedeemedOrCalledDuringPeriodValue | $ 0 |
Noncontrolling Interest [Member] | ||
Stock Redeemed or Called During Period, Value | us-gaap_StockRedeemedOrCalledDuringPeriodValue | $ 0 |