Lightstone Value Plus REIT V (LVVP) 10-Q 15 May 18 2018 Q1 Quarterly report Financial data

Document And Entity Information

Document And Entity Information - shares shares in Millions	3 Months Ended
	Mar. 31, 2018	May 01, 2018
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 31, 2018
Document Fiscal Year Focus	2,018
Document Fiscal Period Focus	Q1
Entity Registrant Name	Lightstone Value Plus Real Estate Investment Trust V, Inc.
Entity Central Index Key	1,387,061
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		24.5

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Real estate
Land and improvements	$ 40,394	$ 40,354
Building and improvements	157,394	157,073
Furniture, fixtures and equipment	5,987	5,812
Gross real estate	203,775	203,239
Less accumulated depreciation	(40,607)	(38,373)
Net investment property	163,168	164,866
Investment in unconsolidated joint venture	10,944	10,944
Cash and cash equivalents	36,960	52,147
Marketable securities, available for sale	14,803	0
Restricted cash	4,498	5,213
Prepaid expenses and other assets	2,902	2,994
Total Assets	233,275	236,164
Liabilities and Stockholders' Equity
Notes payable, net	89,559	89,921
Accounts payable, accrued and other liabilities	4,197	4,150
Payables to related parties	69	33
Distributions payable to noncontrolling interests	19	27
Accrued property tax	2,430	2,398
Total liabilities	96,274	96,529
Commitments and Contingencies
Stockholders' Equity:
Preferred stock, $.0001 par value per share; 50,000,000 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; 350,000,000 shares authorized, 24,535,961 and 24,646,494 shares issued and outstanding, respectively	2	2
Additional paid-in-capital	224,347	224,923
Accumulated other comprehensive loss	(144)	(27)
Accumulated deficit	(91,940)	(90,108)
Total Company stockholders' equity	132,265	134,790
Noncontrolling interests	4,736	4,845
Total Stockholder's Equity	137,001	139,635
Total Liabilities and Stockholders' Equity	$ 233,275	$ 236,164

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - $ / shares	Mar. 31, 2018	Dec. 31, 2017
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)	24,535,961	24,646,494
Common stock, shares outstanding (in shares)	24,535,961	24,646,494

Consolidated Statements of Oper

Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Revenues
Rental revenues	$ 6,686	$ 6,072
Hotel revenues	0	5,345
Total revenues	6,686	11,417
Expenses
Property operating expenses	2,441	2,087
Hotel operating expenses	0	3,570
Interest expense, net	1,323	1,469
Real estate taxes	1,130	1,107
Property management fees	246	395
Asset management fees	390	509
General and administrative	928	798
Depreciation and amortization	2,429	2,578
Total expenses	8,887	12,513
Interest income, net	132	62
Other income	17	1
Loss before gain on sale of real estate	(2,052)	(1,033)
Gain on sale of real estate and other assets	247	282
Net loss	(1,805)	(751)
Net income attributable to the noncontrolling interest	(27)	(105)
Net loss attributable to the Company's shares	$ (1,832)	$ (856)
Weighted average shares outstanding:
Basic and diluted	24,608	25,172
Basic and diluted loss per share	$ (0.07)	$ (0.03)
Comprehensive loss:
Net loss	$ (1,805)	$ (751)
Other comprehensive (loss)/income:
Holding loss on marketable securities, available for sale	(139)	0
Foreign currency translation gain	22	54
Total other comprehensive (loss)/income	(117)	54
Comprehensive loss:	(1,922)	(697)
Comprehensive income attributable to noncontrolling interest	(27)	(105)
Comprehensive loss attributable to the Company's shares	$ (1,949)	$ (802)

Consolidated Statement of Stock

Consolidated Statement of Stockholders' Equity - 3 months ended Mar. 31, 2018 - USD ($) shares in Thousands, $ in Thousands	Total	Convertible Stock	Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive Loss	Accumulated Deficit	Noncontrolling Interests
Beginning Balance at Dec. 31, 2017	$ 139,635	$ 0	$ 2	$ 224,923	$ (27)	$ (90,108)	$ 4,845
Beginning Balance (in shares) at Dec. 31, 2017		1	24,647
Increase (Decrease) in Stockholders' Equity
Net income	(1,805)	$ 0	$ 0	0	0	(1,832)	27
Distributions to noncontrolling interest holders	(136)	0	0	0	0	0	(136)
Redemption and cancellation of shares	(576)	$ 0	$ 0	(576)	0	0	0
Redemption and cancellation (in shares)		0	(111)
Other comprehensive income:
Holding loss on marketable securities, available for sale	139	$ 0	$ 0	0	(139)	0	0
Foreign currency translation gain	22	$ 0	$ 0	0	22	0	0
Ending Balance (in shares) at Mar. 31, 2018		1	24,536
Ending Balance at Mar. 31, 2018	$ 137,001	$ 0	$ 2	$ 224,347	$ (144)	$ (91,940)	$ 4,736

Consolidated Statements of Cash

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$ (1,805)	$ (751)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	2,429	2,538
Amortization of deferred financing fees	77	110
Other non-cash adjustments	(191)	(283)
Changes in operating assets and liabilities:
Increase in prepaid expenses and other assets	(184)	(346)
Decrease in accounts payable, accrued property tax and accrued and other liabilities	307	271
Decrease in payables to related parties	36	161
Net cash provided by operating activities	669	1,700
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of marketable securities, available for sale	(14,941)	0
Additions of real estate	(536)	(299)
Cash used in investing activities	(15,477)	(299)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on notes payable	(396)	(581)
Redemptions of common stock	(576)	(681)
Contributions from noncontrolling interest holders	0	30
Distributions to noncontrolling interest holders	(144)	(119)
Net cash used in financing activities	(1,116)	(1,351)
Effect of exchange rate changes on cash, cash equivalents, and restricted cash	22	65
Net change in cash, cash equivalents and restricted cash	(15,902)	115
Cash, cash equivalents and restricted cash, beginning of year	57,360	73,212
Cash, cash equivalents and restricted cash, end of period	41,458	73,327
Supplemental cash flow information for the periods indicated is as follows:
Cash paid for interest	931	1,484
Capital expenditures for real estate in accrued liabilities and accounts payable	60	45
Accrued distributions payable to noncontrolling interests	19	22
Unrealized loss on marketable securities, available for sale	$ 139	$ 0

Business and Organization

Business and Organization	3 Months Ended
	Mar. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Business and Organization	1. Business and Organization Business Behringer Harvard Opportunity REIT II, Inc., which changed its name to Lightstone Value Plus Real Estate Investment Trust V, Inc. effective 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. As of March 31, 2018, we had eight real estate investments, seven of which were consolidated (one wholly owned property and six properties consolidated through investments in joint ventures) and one real estate investment which we account for under the equity method. Substantially all of our business is conducted through Behringer Harvard Opportunity OP II LP, a limited partnership organized in Delaware (the “Operating Partnership”). As of March 31, 2018, our wholly-owned subsidiary, BHO II, Inc., a Delaware corporation, owned a 0.1 99.9 Our business has been managed by an external advisor since the commencement of our initial public offering, and we have no employees. From January 4, 2008 through February 10, 2017, an affiliate of Stratera Services, LLC, formerly known as “Behringer Harvard Holdings, LLC” (“Behringer”), acted as our external advisor (the “Behringer Advisor”). On February 10, 2017, we terminated our engagement of the Behringer Advisor and 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. The 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 22.5 1.0 24.5 1.0 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. We previously targeted the commencement of a liquidity event within six years after the termination of our initial public offering, which occurred on July 3, 2011. On June 29, 2017, our board of directors elected to extend the targeted timeline an additional six years until June 30, 2023 based on their assessment of our investment objectives and liquidity options for our stockholders. However, 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.

Interim Unaudited Financial Inf

Interim Unaudited Financial Information	3 Months Ended
	Mar. 31, 2018
Interim Unaudited Financial Information Disclosure [Abstract]
Interim Unaudited Financial Information	2. 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, 2017, which was filed with the Securities and Exchange Commission (the “SEC”) on March 29, 2018. 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 accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. The consolidated balance sheet as of December 31, 2017 included herein has been derived from the consolidated balance sheet included in the Company's Annual Report on Form 10-K. The unaudited consolidated statements of operations for interim periods are not necessarily indicative of results for the full year or any other period.

Summary of Significant Accounti

Summary of Significant Accounting Policies	3 Months Ended
	Mar. 31, 2018
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	3. Summary of Significant Accounting Policies The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The most significant assumptions and estimates relate to the valuation of real estate including impairment and depreciable lives. Application of these assumptions requires the exercise of judgment as to future uncertainties and, as a result, actual results could differ from these estimates. 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. There are judgments and estimates involved in determining if an entity in which we have made an investment is a VIE and, if so, whether we are the primary beneficiary. The entity is evaluated to determine if it is a VIE by, among other things, calculating the percentage of equity being risked compared to the total equity of the entity. Determining expected future losses involves assumptions of various possibilities of the results of future operations of the entity, assigning a probability to each possibility, and using a discount rate to determine the net present value of those future losses. A change in the judgments, assumptions, and estimates outlined above could result in consolidating an entity that should not be consolidated or accounting for an investment using the equity method that should in fact be consolidated, the effects of which could be material to our consolidated financial statements. As required by our lenders, restricted cash is held in escrow accounts for anticipated capital expenditures, real estate taxes, and other reserves for our consolidated properties. Capital reserves are typically utilized for non-operating expenses such as tenant improvements, leasing commissions, and major capital expenditures. Alternatively, a lender may require its own formula for an escrow of capital reserves. On occasion, restricted cash may also include certain funds temporarily placed in escrows with qualified intermediaries in order to facilitate potential like-kind exchange transactions in accordance with Section 1031 of the Internal Revenue Code of 1986, as amended. Three Months Ended March 31, 2018 2017 Cash and cash equivalents $ 36,960 $ 67,150 Restricted cash 4,498 6,177 Total cash, cash equivalents and restricted cash $ 41,458 $ 73,327 Noncontrolling interest 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 interest which is different from the standard pro-rata allocation percentage. In certain instances, our joint venture agreement provides for liquidating distributions based on achieving certain return metrics (“promoted interest”). Marketable securities currently consist of debt securities that are designated as available-for-sale and are recorded at fair value. Unrealized holding gains or losses for debt securities are reported as a component of accumulated other comprehensive income/(loss). Realized gains or losses resulting from the sale of these securities are determined based on the specific identification of the securities sold. An impairment charge is recognized when the decline in the fair value of a security below the amortized cost basis is determined to be other-than-temporary. The Company considers various factors in determining whether to recognize an impairment charge, including the duration and severity of any decline in fair value below our amortized cost basis, any adverse changes in the financial condition of the issuers’ and its intent and ability to hold the investment for a period of time sufficient to allow for any anticipated recovery in market value. 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.

New Accounting Pronouncements

New Accounting Pronouncements	3 Months Ended
	Mar. 31, 2018
New Accounting Pronouncements and Changes in Accounting Principles [Abstract]
New Accounting Pronouncements	4. New Accounting Pronouncements Recently Adopted Accounting Pronouncements Effective January 1, 2018 the Company adopted guidance issued by the Financial Accounting Standards Board (“FASB”) that that requires companies to measure investments in equity securities, except those accounted for under the equity method, at fair value and recognize any changes in fair value in net income, using a modified-retrospective transition method. Since the Company had no investments in equity securities, except those accounted for under the equity method prior to January 1, 2018, the adoption of this standard had no effect on its consolidated financial statements when adopted. Effective January 1, 2018, the Company adopted guidance issued by the FASB that clarifies the definition of a business and assists in the evaluation of whether a transaction will be accounted for as an acquisition of an asset or as a business combination. The guidance provides a test to determine when a set of assets and activities acquired is not a business. When substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets, the set is not a business. Additionally, assets acquired, liabilities assumed, and any noncontrolling interest will be measured at their relative fair values. The Company anticipates future acquisitions of real estate assets, if any, will likely qualify as an asset acquisition. Therefore, any future transaction costs associated with an asset acquisition will be capitalized and accounted for in accordance with this guidance. Effective January 1, 2018, the Company adopted guidance issued by the FASB that outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most of the existing revenue recognition guidance. The new guidance requires companies to apply a five-step model in accounting for revenue arising from contracts with customers, as well as enhance disclosures regarding revenue recognition. Lease contracts are excluded from this revenue recognition criteria; however, the sale of real estate will be required to follow the new model. The Company has adopted this standard using the modified retrospective transition method. The adoption of this pronouncement had no effect on our consolidated financial statements since, with the disposal of the Courtyard Kauai Coconut Beach Hotel in August 2017, all revenues now consist of rental income from leasing arrangements, which is specifically excluded from the standard. New Accounting Pronouncements In June 2016, the FASB issued an accounting standards update which replaces the incurred loss impairment methodology currently in use with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The new guidance is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. This guidance will not have a material impact on the Company’s consolidated financial statements. In February 2016, the FASB issued an accounting standards update which supersedes the existing lease accounting model, and modifies both lessee and lessor accounting. The new guidance will require lessees to recognize a liability to make lease payments and a right-of-use asset, initially measured at the present value of lease payments, for both operating and financing leases, with classification affecting the pattern of expense recognition in the statement of operations. For leases with a term of 12 months or less, lessees will be permitted to make an accounting policy election by class of underlying asset to not recognize lease liabilities and lease assets. The Company intends to adopt the standard on January 1, 2019 and apply certain practical expedients available to us upon adoption. The Company is continuing to evaluate the impact this guidance will have on our consolidated financial statements when adopted. The Company has reviewed and determined that other recently issued accounting pronouncements will not have a material impact on its financial position, results of operations and cash flows, or do not apply to its current operations. Reclassifications Certain prior period amounts have been reclassified to conform to the current year presentation.

Financial Instruments

Financial Instruments	3 Months Ended
	Mar. 31, 2018
Fair Value Disclosures [Abstract]
Financial Instruments not Reported at Fair Value	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, 2018 and December 31, 2017, management estimated that the carrying value of cash and cash equivalents, restricted cash, prepaid expenses and other assets, accounts payable, accrued and other liabilities, payables/receivables to/from related parties, and distributions payable to noncontrolling interests were at amounts that reasonably approximated their fair value based on their highly-liquid nature and short-term maturities. 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, 2018 and December 31, 2017. Carrying amounts of our notes payable and the related estimated fair value is summarized as follows: As of March 31, 2018 As of December 31, 2017 Carrying Estimated Fair Carrying Estimated Fair Notes payable $ 89,883 $ 90,505 $ 90,321 $ 91,449

Marketable Securities and Fair

Marketable Securities and Fair Value Measurements	3 Months Ended
	Mar. 31, 2018
Marketable Securities And Fair Value Measurements [Abstract]
Marketable Securities And Fair Value Measurements	6. Marketable Securities and Fair Value Measurements Marketable Securities As of March 31, 2018 Adjusted Gross Gross Fair Debt securities: Corporate Bonds $ 14,942 $ 1 $ (140) $ 14,803 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, 2018, 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 Corporate Bonds are measured using quoted prices for these investments; however, the markets for these assets are not active. As of March 31, 2018, all of the Company’s Corporate Bonds were classified as Level 2 assets and there were no transfers between the level classifications during the three months ended March 31, 2018. 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 Due in 1 year $ 2,767 Due in 1 year through 5 years 8,860 Due in 5 year through 10 years 3,176 Due after 10 years - Total $ 14,803 The Company did not have any other significant financial assets or liabilities, which would require revised valuations that are recognized at fair value.

Notes Payable

Notes Payable	3 Months Ended
	Mar. 31, 2018
Debt Disclosure [Abstract]
Notes Payable	7 . Notes Payable Property Interest Rate Weighted Average Maturity Date Amount Due at As of As of River Club and the Townhomes at River Club 5.26% 5.26 % May 1, 2018 $ 23,368 $ 23,402 $ 23,511 Lakes of Margate 5.49% and 5.92% 5.75 % January 1, 2020 $ 13,384 $ 13,900 $ 13,973 Arbors Harbor Town 3.99% 3.99 % January 1, 2019 $ 23,632 $ 24,021 $ 24,153 22 Exchange 3.93% 3.93 % Due on demand $ 16,875 $ 18,935 $ 18,963 Parkside (1) 5.00% 5.00 % June 1, 2018 $ 9,560 $ 9,625 $ 9,721 Total notes payable 4.69 % $ 86,819 $ 89,883 $ 90,321 Less: Deferred financing costs (324) (400) Total notes payable, net $ 89,559 $ 89,921 _________________________________ (1) Includes approximately $ 28 For loans in place as of March 31, 2018, we have guaranteed payment of certain recourse liabilities with respect to certain customary nonrecourse carveouts as set forth in the guaranties in favor of the unaffiliated lenders with respect to the 22 Exchange and Parkside notes payable. We are subject to various customary financial covenants, including, maintaining minimum debt service coverage ratios, loan to value ratios and liquidity. We did not meet the debt service coverage requirements for our 22 Exchange loan for all of the quarterly periods in 2017 and as a result, the lender elected to sweep the cash from operations beginning in January 2018. Additionally, the cash flow from operations was not sufficient to fully pay the scheduled monthly debt service due on January 5, 2018, which constituted an event of default and therefore, the 22 Exchange loan which was scheduled to mature in May 2023 became due on demand. We received notice on January 9, 2018 that the 22 Exchange loan had been transferred to a special servicer effective immediately. Subsequently, the special servicer placed the property in receivership and has commenced foreclosure proceedings. The Company is accruing default interest expense on the 22 Exchange loan pursuant to the terms of its loan agreement. Default interest expense of $ 0.4 0.4 we believe the loss of cash flow and the expected loss of this property will not have a material impact on our consolidated results of operations or financial condition. 2018 2019 2020 2021 2022 Thereafter Total Principal maturities $ 52,537 $ 23,934 $ 13,384 $ - $ - $ - $ 89,855 Unamortized premium 28 Total mortgages payable 89,883 Less: deferred financing costs (324) Total mortgages payable, net $ 89,559 In addition to the 22 Exchange loan, as of March 31, 2018, the Company had debt of approximately $ 23.4 9.6 24.0 On May 1, 2018, the Company entered into a non-recourse mortgage loan (the “Mortgage”) in the amount of $ 30.3 1.78 23.4

Distributions

Distributions	3 Months Ended
	Mar. 31, 2018
Distributions [Abstract]
Distributions	8. Distributions U.S. federal tax law requires a REIT distribute at least 90

Related Party Transactions

Related Party Transactions	3 Months Ended
	Mar. 31, 2018
Related Party Transactions [Abstract]
Related Party Transactions	9. Related Party Transactions Advisor Our external advisor and certain of its affiliates may receive fees and compensation in connection with the management and sale of our assets based on an advisory management agreement, as amended and restated. From January 4, 2008 through February 10, 2017, we were party to various advisory management agreements, each with a term of one year or less, with the Behringer Advisor. On February 10, 2017, we and the Behringer Advisor terminated the then existing advisory management agreement effective as of the close of business. Concurrently, we engaged the Advisor to provide us with advisory services pursuant to various advisory management agreements, each with an initial term of one year. The fees earned by and expenses reimbursed to the Advisor are substantially the same as the fees earned by and expenses reimbursed to the Behringer Advisor. The following discussion describes the fees and expenses payable to our external advisor and its respective affiliates under the various advisory management agreements. We pay our external advisor acquisition and advisory fees of 1.5 1.5 We also pay our external advisor an acquisition expense reimbursement in the amount of (i) 0.25 0.25 0.25 Our external advisor and its affiliates are also responsible for paying all of the investment-related expenses that we or the external advisor or its affiliates incur that are due to third parties or related to the additional services provided by our external advisor as described above with respect to investments we do not make, other than certain non-refundable payments made in connection with any acquisition. For the three months ended March 31, 2018 and 2017, we incurred no acquisition expense reimbursements. We pay our external advisor a debt financing fee of 0.5 We pay our external advisor a development fee in an amount that is usual and customary for comparable services rendered to similar projects in the geographic market of the project if such affiliate provides the development services and if a majority of our independent directors determines that such development fee is fair and reasonable to us. We incurred no development fees for the three months ended March 31, 2018 and 2017. We pay our external advisor a monthly asset management fee of one-twelfth of 0.7 0.4 Our external advisor is responsible for paying all of the expenses it incurs associated with persons employed by the external advisor to the extent that they provide services to us for which our external advisor receives an acquisition, asset management, or debt financing fee, including wages and benefits of the applicable personnel. Instead of reimbursing our external advisor for specific expenses paid or incurred in connection with providing services to us, we pay our external advisor an administrative services fee, also referred to as an administrative services reimbursement (the “Administrative Services Fee”). The Administrative Services Fee is intended to reimburse the external advisor for all its costs associated with providing services to us. For the calendar year ending December 31, 2017, the Administrative Services Fee was up to $ 1.325 1.30 1.3 45 0.3 Notwithstanding the fees and cost reimbursements payable to our external advisor pursuant to our advisory management agreement, under our charter we may not reimburse the external advisor for any amount by which our operating expenses (including the asset management fee) at the end of the four preceding fiscal quarters exceeds the greater of: (i) 2 25 Property Manager From January 4, 2008 through February 10, 2017, we were party to various property management and leasing agreements between us, our operating partnership, and certain affiliates of Behringer (collectively, the “Behringer Manager”). On February 10, 2017, we and the Behringer Manager terminated the then existing property management and leasing agreements effective as of the close of business. Concurrently, we engaged an affiliate of Lightstone (the “Lightstone Manager”) pursuant to a property management and leasing agreement. The fees earned by and expenses reimbursed to the Lightstone Manager are substantially the same as the fees earned by and expenses reimbursed to the Behringer Manager. The following discussion describes the fees and expenses payable to our affiliated property manager and its respective affiliates under both the various property management and leasing agreements. We pay our property manager and affiliate of our external advisor, fees for the management, leasing, and construction supervision of our properties which is 4.0 0.5 0.1 0.1 We pay our property manager a construction management fee in an amount not to exceed 5 As of both March 31, 2018 and December 31, 2017, we had a payable to our external advisor and its affiliates of less than $ 0.1 We are dependent on our external advisor and our property manager for certain services that are essential to us, including asset disposition decisions, property management and leasing services, and other general administrative responsibilities. In the event that these companies were unable to provide us with their respective services, we would be required to obtain such services from other sources.

Subsequent Events

Subsequent Events	3 Months Ended
	Mar. 31, 2018
Subsequent Events [Abstract]
Subsequent Events	10. Subsequent Events Share Redemption Program On May 10, 2018, our board of directors approved redemptions for the second quarter of 2018 totaling 47 0.3

Summary of Significant Accoun17

Summary of Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2018
Accounting Policies [Abstract]
Use of Estimates in the Preparation of Financial Statements	Use of Estimates in the Preparation of Financial Statements The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The most significant assumptions and estimates relate to the valuation of real estate including impairment and depreciable lives. Application of these assumptions requires the exercise of judgment as to future uncertainties and, as a result, actual results could differ from these estimates.
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. There are judgments and estimates involved in determining if an entity in which we have made an investment is a VIE and, if so, whether we are the primary beneficiary. The entity is evaluated to determine if it is a VIE by, among other things, calculating the percentage of equity being risked compared to the total equity of the entity. Determining expected future losses involves assumptions of various possibilities of the results of future operations of the entity, assigning a probability to each possibility, and using a discount rate to determine the net present value of those future losses. A change in the judgments, assumptions, and estimates outlined above could result in consolidating an entity that should not be consolidated or accounting for an investment using the equity method that should in fact be consolidated, the effects of which could be material to our consolidated financial statements.
Restricted Cash	Restricted Cash As required by our lenders, restricted cash is held in escrow accounts for anticipated capital expenditures, real estate taxes, and other reserves for our consolidated properties. Capital reserves are typically utilized for non-operating expenses such as tenant improvements, leasing commissions, and major capital expenditures. Alternatively, a lender may require its own formula for an escrow of capital reserves. On occasion, restricted cash may also include certain funds temporarily placed in escrows with qualified intermediaries in order to facilitate potential like-kind exchange transactions in accordance with Section 1031 of the Internal Revenue Code of 1986, as amended. Three Months Ended March 31, 2018 2017 Cash and cash equivalents $ 36,960 $ 67,150 Restricted cash 4,498 6,177 Total cash, cash equivalents and restricted cash $ 41,458 $ 73,327
Noncontrolling Interest	Noncontrolling Interest Noncontrolling interest 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 interest which is different from the standard pro-rata allocation percentage. In certain instances, our joint venture agreement provides for liquidating distributions based on achieving certain return metrics (“promoted interest”).
Marketable Securities	Marketable Securities Marketable securities currently consist of debt securities that are designated as available-for-sale and are recorded at fair value. Unrealized holding gains or losses for debt securities are reported as a component of accumulated other comprehensive income/(loss). Realized gains or losses resulting from the sale of these securities are determined based on the specific identification of the securities sold. An impairment charge is recognized when the decline in the fair value of a security below the amortized cost basis is determined to be other-than-temporary. The Company considers various factors in determining whether to recognize an impairment charge, including the duration and severity of any decline in fair value below our amortized cost basis, any adverse changes in the financial condition of the issuers’ and its intent and ability to hold the investment for a period of time sufficient to allow for any anticipated recovery in market value.
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.

Summary of Significant Accoun18

Summary of Significant Accounting Policies (Tables)	3 Months Ended
	Mar. 31, 2018
Accounting Policies [Abstract]
Schedule of cash, cash equivalents and restricted cash	The following is a summary of our cash, cash equivalents, and restricted cash total as presented in our statements of cash flows for the three months ended March 31, 2018 and 2017: Three Months Ended March 31, 2018 2017 Cash and cash equivalents $ 36,960 $ 67,150 Restricted cash 4,498 6,177 Total cash, cash equivalents and restricted cash $ 41,458 $ 73,327

Financial Instruments (Tables)

Financial Instruments (Tables)	3 Months Ended
	Mar. 31, 2018
Fair Value Disclosures [Abstract]
Fair Value, by Balance Sheet Grouping	Carrying amounts of our notes payable and the related estimated fair value is summarized as follows: As of March 31, 2018 As of December 31, 2017 Carrying Estimated Fair Carrying Estimated Fair Notes payable $ 89,883 $ 90,505 $ 90,321 $ 91,449

Marketable Securities and Fai20

Marketable Securities and Fair Value Measurements (Tables)	3 Months Ended
	Mar. 31, 2018
Schedule of Available-for-sale Securities Reconciliation	As of March 31, 2018 Adjusted Gross Gross Fair Debt securities: Corporate Bonds $ 14,942 $ 1 $ (140) $ 14,803
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, Due in 1 year $ 2,767 Due in 1 year through 5 years 8,860 Due in 5 year through 10 years 3,176 Due after 10 years - Total $ 14,803

Notes Payable (Tables)

Notes Payable (Tables)	3 Months Ended
	Mar. 31, 2018
Debt Disclosure [Abstract]
Schedule of information on notes payable	Notes payable consists of the following: Property Interest Rate Weighted Average Maturity Date Amount Due at As of As of River Club and the Townhomes at River Club 5.26% 5.26 % May 1, 2018 $ 23,368 $ 23,402 $ 23,511 Lakes of Margate 5.49% and 5.92% 5.75 % January 1, 2020 $ 13,384 $ 13,900 $ 13,973 Arbors Harbor Town 3.99% 3.99 % January 1, 2019 $ 23,632 $ 24,021 $ 24,153 22 Exchange 3.93% 3.93 % Due on demand $ 16,875 $ 18,935 $ 18,963 Parkside (1) 5.00% 5.00 % June 1, 2018 $ 9,560 $ 9,625 $ 9,721 Total notes payable 4.69 % $ 86,819 $ 89,883 $ 90,321 Less: Deferred financing costs (324) (400) Total notes payable, net $ 89,559 $ 89,921
Contractual obligations for principal payments	2018 2019 2020 2021 2022 Thereafter Total Principal maturities $ 52,537 $ 23,934 $ 13,384 $ - $ - $ - $ 89,855 Unamortized premium 28 Total mortgages payable 89,883 Less: deferred financing costs (324) Total mortgages payable, net $ 89,559

Business and Organization (Deta

Business and Organization (Details) - shares	3 Months Ended
	Mar. 31, 2018	Dec. 31, 2017	Jan. 19, 2007
Organization
Percentage of ownership interest by BHO II, Inc	0.10%
Percentage of remaining ownership interest held by BHO Business Trust II	99.90%
Common stock, shares outstanding (in shares)	24,535,961	24,646,494
Common stock, shares issued (in shares)	24,535,961	24,646,494
Convertible stock issued (in shares)	1,000	1,000
Convertible Stock Shares Outstanding	1,000	1,000
Initial Offering
Organization
Common stock, shares outstanding (in shares)	24,500,000
Initial Offering | Lightstone Group
Organization
Convertible Stock Shares Outstanding	1,000
Initial Capitalization | Behringer Harvard Holdings
Organization
Common stock, shares issued (in shares)			22,500
Convertible stock issued (in shares)			1,000

Summary of Significant Accoun23

Summary of Significant Accounting Policies - Restricted Cash (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017	Mar. 31, 2017	Dec. 31, 2016
Cash and cash equivalents	$ 36,960	$ 52,147	$ 67,150
Restricted cash	4,498	5,213	6,177
Total cash, cash equivalents and restricted cash	$ 41,458	$ 57,360	$ 73,327	$ 73,212

Financial Instruments (Details)

Financial Instruments (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Notes payable, carrying amount	$ 89,883	$ 90,321
Notes payable, Estimated Fair Value	$ 90,505	$ 91,449

Marketable Securities and Fai25

Marketable Securities and Fair Value Measurements -Available for sale securities(Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Dec. 31, 2017
Fair Value	$ 14,803	$ 0
Corporate Bonds [Member]
Adjusted Cost	14,942
Gross Unrealized Gains	1
Gross Unrealized Losses	(140)
Fair Value	$ 14,803

Marketable Securities and Fai26

Marketable Securities and Fair Value Measurements- Summarizes the estimated fair value of our investments in marketable debt securities(Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Due in 1 year	$ 2,767
Due in 1 year through 5 years	8,860
Due in 5 year through 10 years	3,176
Due after 10 years	0
Total	$ 14,803	$ 0

Notes Payable - Information on

Notes Payable - Information on Notes Payable (Details) - USD ($) $ in Thousands		3 Months Ended
		Mar. 31, 2018	Dec. 31, 2017
Debt Instrument [Line Items]
Less: Deferred financing costs		$ (324)	$ (400)
Notes payable, net		89,559	89,921
Total notes payable, net		$ 89,883	90,321
Notes payable
Debt Instrument [Line Items]
Weighted Average Interest Rate		4.69%
Long-term Debt		$ 86,819
River Club and the Townhomes at River Club
Debt Instrument [Line Items]
Notes payable, net		$ 23,400
River Club and the Townhomes at River Club | Notes payable
Debt Instrument [Line Items]
Interest rate (as a percent)		5.26%
Weighted Average Interest Rate		5.26%
Debt Instrument, Maturity Date		May 1, 2018
Notes payable, net		$ 23,402	23,511
Long-term Debt		$ 23,368
Lakes of Margate | Notes payable
Debt Instrument [Line Items]
Weighted Average Interest Rate		5.75%
Debt Instrument, Maturity Date		Jan. 1, 2020
Notes payable, net		$ 13,900	13,973
Long-term Debt		13,384
Arbors Harbor Town
Debt Instrument [Line Items]
Notes payable, net		$ 24,000
Arbors Harbor Town | Notes payable
Debt Instrument [Line Items]
Interest rate (as a percent)		3.99%
Weighted Average Interest Rate		3.99%
Debt Instrument, Maturity Date		Jan. 1, 2019
Notes payable, net		$ 24,021	24,153
Long-term Debt		$ 23,632
22 Exchange | Notes payable
Debt Instrument [Line Items]
Interest rate (as a percent)		3.93%
Weighted Average Interest Rate		3.93%
Notes payable, net		$ 18,935	18,963
Long-term Debt		16,875
Parkside
Debt Instrument [Line Items]
Notes payable, net		$ 9,600
Parkside | Notes payable
Debt Instrument [Line Items]
Interest rate (as a percent)		5.00%
Weighted Average Interest Rate	[1]	5.00%
Debt Instrument, Maturity Date		Jun. 1, 2018
Notes payable, net	[1]	$ 9,625	$ 9,721
Long-term Debt	[1]	$ 9,560
Minimum | Lakes of Margate | Notes payable
Debt Instrument [Line Items]
Interest rate (as a percent)		5.49%
Maximum | Lakes of Margate | Notes payable
Debt Instrument [Line Items]
Interest rate (as a percent)		5.92%
[1]	Includes approximately $28 of unamortized premium related to debt we assumed at acquisition.

Notes Payable - Contractual Obl

Notes Payable - Contractual Obligations for Principal Payments (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
2,018	$ 52,537
2,019	23,934
2,020	13,384
2,021	0
2,022	0
Thereafter	0
Total contractual obligations for principal payments	89,855
Unamortized premium	28
Total mortgages payable	89,883	$ 90,321
Less: deferred financing costs	(324)	(400)
Total mortgages payable, net	$ 89,559	$ 89,921

Notes Payable - Narrative (Deta

Notes Payable - Narrative (Details) - USD ($) $ in Thousands	May 01, 2018	Mar. 31, 2018	Mar. 31, 2017
Debt Instrument [Line Items]
Debt Instrument, Unamortized Premium		$ 28
Repayments of Notes Payable		396	$ 581
Accounts Payable [Member]
Debt Instrument [Line Items]
Debt Instrument, Debt Default, Amount		400
Debt
Debt Instrument [Line Items]
Debt Instrument, Debt Default, Amount		400
Non Recourse Mortgage Loan [Member] | Subsequent Event [Member]
Debt Instrument [Line Items]
Proceeds from Secured Notes Payable	$ 30,300
Debt Instrument, Interest Rate, Stated Percentage	1.78%
Repayments of Notes Payable	$ 23,400
Parkside
Debt Instrument [Line Items]
Notes payable, net		9,600
Debt Instrument, Unamortized Premium		28
River Club and the Townhomes at River Club
Debt Instrument [Line Items]
Notes payable, net		23,400
Arbors Harbor Town
Debt Instrument [Line Items]
Notes payable, net		$ 24,000

Distributions (Details)

Distributions (Details)	3 Months Ended
	Mar. 31, 2018
Minimum Percentage of Ordinary Taxable Income Distribution Requirement	90.00%

Related Party Transactions (Det

Related Party Transactions (Details) - USD ($)	3 Months Ended		6 Months Ended		12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Related party transaction
Asset management fees	$ 390,000	$ 509,000
Advisor
Related party transaction
Acquisition and advisory fees as percentage of purchase, development, construction, or improvement of each asset acquired	1.50%
Acquisition and advisory fees as percentage of funds advanced in respect of loan investment	1.50%
Acquisition and advisory fees incurred	$ 0	0
Percentage of debt financing fee payable under loan or line of credit	0.50%
Monthly asset management fee	0.70%
Asset management fees	$ 400,000	400,000
Administrative services fee				$ 1,300,000	$ 1,325,000
Administrative services cost incurred and expensed	$ 300,000	300,000
Property management fees as percentage of gross revenues of properties	4.00%
Oversight fee as percentage of gross revenues of property managed	0.50%
Property management fees or oversight fees incurred	$ 100,000	$ 100,000
Construction management fees, percentage	5.00%
Payment of Administrative Service Costs Maximum Period	45 days
Payable to external advisor and affiliates	$ 100,000				$ 100,000
Advisor | Minimum
Related party transaction
Operating expenses in excess of average invested assets	2.00%
Operating expenses in excess of net income	25.00%
Advisor | Scenario, Forecast
Related party transaction
Administrative services fee			$ 1,300,000
Asset Purchases | Advisor
Related party transaction
Percentage of reimbursement of acquisition expense	0.25%
Development, Construction or Improvement of Assets | Advisor
Related party transaction
Percentage of reimbursement of acquisition expense	0.25%
Funds Advanced for Loan Investment | Advisor
Related party transaction
Percentage of reimbursement of acquisition expense	0.25%

Subsequent Events (Details)

Subsequent Events (Details) shares in Thousands, $ in Millions	May 10, 2018USD ($)shares
Subsequent Event [Line Items]
Shares approved for redemption (in shares) | shares	47
Shares approved for redemption | $	$ 0.3