Document_and_Entity_Informatio
Document and Entity Information | 6 Months Ended | |
Jun. 30, 2014 | Aug. 11, 2014 | |
Document And Entity Information [Abstract] | ' | ' |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 30-Jun-14 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q2 | ' |
Entity Registrant Name | 'Strategic Storage Trust, Inc. | ' |
Entity Central Index Key | '0001410567 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Non-accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 57,175,038 |
Consolidated_Balance_Sheets_Un
Consolidated Balance Sheets (Unaudited) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
ASSETS | ' | ' |
Cash and cash equivalents | $23,726,429 | $39,603,949 |
Real estate facilities: | ' | ' |
Land | 200,256,893 | 194,033,413 |
Buildings | 464,046,983 | 456,372,075 |
Site improvements | 44,898,638 | 43,733,299 |
Real estate facilities, gross | 709,202,514 | 694,138,787 |
Accumulated depreciation | -55,971,913 | -46,432,155 |
Real estate facilities, net of depreciation | 653,230,601 | 647,706,632 |
Construction in process | 5,067,025 | 776,804 |
Real estate facilities, net | 658,297,626 | 648,483,436 |
Deferred financing costs, net of accumulated amortization | 5,593,786 | 5,798,963 |
Intangible assets, net of accumulated amortization | 8,659,434 | 10,447,513 |
Restricted cash | 5,997,952 | 6,506,112 |
Investments in unconsolidated joint ventures | 8,605,395 | 8,662,363 |
Other assets | 3,208,770 | 3,777,167 |
Total assets | 714,089,392 | 723,279,503 |
LIABILITIES AND EQUITY | ' | ' |
Secured debt | 398,116,320 | 391,285,760 |
Accounts payable and accrued liabilities | 10,179,166 | 9,917,437 |
Due to affiliates | 1,299,562 | 1,741,518 |
Distributions payable | 3,312,939 | 3,355,882 |
Total liabilities | 412,907,987 | 406,300,597 |
Commitments and contingencies (Note 8) | ' | ' |
Strategic Storage Trust, Inc. equity: | ' | ' |
Preferred Stock, $0.001 par value; 200,000,000 shares authorized; none issued and outstanding at June 30, 2014 and December 31, 2013, respectively | 0 | 0 |
Common stock, $0.001 par value; 700,000,000 shares authorized; 57,027,784 and 56,136,435 shares issued and outstanding at June 30, 2014 and December 31, 2013, respectively | 57,027 | 56,136 |
Additional paid-in capital | 493,801,866 | 487,032,573 |
Distributions | -126,730,385 | -107,090,016 |
Accumulated deficit | -68,976,663 | -69,376,201 |
Accumulated other comprehensive loss | -1,236,683 | -1,615,743 |
Total Strategic Storage Trust, Inc. equity | 296,915,162 | 309,006,749 |
Noncontrolling interest in our Operating Partnership | 4,187,359 | 2,289,379 |
Other noncontrolling interests | 78,884 | 5,682,778 |
Total noncontrolling interests | 4,266,243 | 7,972,157 |
Total equity | 301,181,405 | 316,978,906 |
Total liabilities and equity | $714,089,392 | $723,279,503 |
Consolidated_Balance_Sheets_Un1
Consolidated Balance Sheets (Unaudited) (Parenthetical) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Statement Of Financial Position [Abstract] | ' | ' |
Preferred stock, par value | $0.00 | $0.00 |
Preferred Stock, shares authorized | 200,000,000 | 200,000,000 |
Preferred Stock, shares issued | 0 | 0 |
Preferred Stock, shares outstanding | 0 | 0 |
Common stock, par value | $0.00 | $0.00 |
Common stock, shares authorized | 700,000,000 | 700,000,000 |
Common stock, shares issued | 57,027,784 | 56,136,435 |
Common stock, shares outstanding | 57,027,784 | 56,136,435 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (Unaudited) (USD $) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | |
Revenues: | ' | ' | ' | ' |
Self storage rental revenue | $23,541,580 | $19,249,306 | $45,984,948 | $38,059,075 |
Ancillary operating revenue | 779,826 | 681,902 | 1,469,402 | 1,280,074 |
Total revenues | 24,321,406 | 19,931,208 | 47,454,350 | 39,339,149 |
Operating expenses: | ' | ' | ' | ' |
Property operating expenses | 7,694,942 | 7,147,282 | 15,487,682 | 13,860,563 |
Property operating expenses - affiliates | 2,958,340 | 2,357,413 | 5,845,550 | 4,645,142 |
General and administrative | 932,292 | 787,778 | 2,119,515 | 1,482,540 |
Depreciation | 4,916,734 | 4,160,092 | 9,745,884 | 8,255,628 |
Intangible amortization expense | 1,404,823 | 2,000,739 | 3,068,079 | 4,690,731 |
Acquisition expenses - affiliates | 103,703 | 53,010 | 612,245 | 106,619 |
Other acquisition expenses | 555,443 | 160,730 | 792,552 | 183,706 |
Total operating expenses | 18,566,277 | 16,667,044 | 37,671,507 | 33,224,929 |
Operating income | 5,755,129 | 3,264,164 | 9,782,843 | 6,114,220 |
Other income (expense): | ' | ' | ' | ' |
Interest expense | -4,419,503 | -4,686,164 | -9,039,661 | -9,350,994 |
Deferred financing amortization expense | -369,069 | -346,522 | -657,257 | -741,111 |
Equity in earnings of real estate ventures | 191,016 | 199,464 | 391,463 | 422,835 |
Other | 291,664 | -380,041 | -67,807 | -561,508 |
Net income (loss) | 1,449,237 | -1,949,099 | 409,581 | -4,116,558 |
Net (income) loss attributable to the noncontrolling interests in our Operating Partnership | -15,788 | 9,657 | -7,204 | 20,723 |
Net income attributable to other noncontrolling interests | -228 | -9,637 | -2,839 | -20,468 |
Net income (loss) attributable to Strategic Storage Trust, Inc. | $1,433,221 | ($1,949,079) | $399,538 | ($4,116,303) |
Net income (loss) per share - basic | $0.03 | ($0.04) | $0.01 | ($0.09) |
Net income (loss) per share - diluted | $0.03 | ($0.04) | $0.01 | ($0.09) |
Weighted average shares outstanding - basic | 56,806,134 | 48,530,157 | 56,583,229 | 47,623,669 |
Weighted average shares outstanding - diluted | 56,809,884 | 48,530,157 | 56,586,979 | 47,623,669 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income (Loss) (Unaudited) (USD $) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | |
Statement Of Income And Comprehensive Income [Abstract] | ' | ' | ' | ' |
Net income (loss) | $1,449,237 | ($1,949,099) | $409,581 | ($4,116,558) |
Other comprehensive income (loss): | ' | ' | ' | ' |
Foreign currency translation adjustments | 801,037 | -499,968 | 243,212 | -846,398 |
Change in fair value of interest rate swap | 79,632 | 92,010 | 135,848 | 157,288 |
Other comprehensive income (loss) | 880,669 | -407,958 | 379,060 | -689,110 |
Comprehensive income (loss) | 2,329,906 | -2,357,057 | 788,641 | -4,805,668 |
Comprehensive (income) loss attributable to noncontrolling interests: | ' | ' | ' | ' |
Comprehensive (income) loss attributable to the noncontrolling interests in our Operating Partnership | -24,810 | 10,941 | -11,235 | 23,963 |
Comprehensive income attributable to other noncontrolling interests | -228 | -9,637 | -2,839 | -20,468 |
Comprehensive income (loss) attributable to Strategic Storage Trust, Inc. | 2,304,868 | -2,355,753 | 774,567 | -4,802,173 |
Comprehensive income (loss) | $2,329,906 | ($2,357,057) | $788,641 | ($4,805,668) |
Consolidated_Statement_of_Equi
Consolidated Statement of Equity (Unaudited) (USD $) | Total | Common Stock | Additional Paid-in Capital | Distributions | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Total Strategic Storage Trust, Inc. Equity [Member] | Noncontrolling Interests |
Beginning Balance at Dec. 31, 2013 | $316,978,906 | $56,136 | $487,032,573 | ($107,090,016) | ($69,376,201) | ($1,615,743) | $309,006,749 | $7,972,157 |
Beginning Balance, (in shares) at Dec. 31, 2013 | 56,136,435 | 56,136,435 | ' | ' | ' | ' | ' | ' |
Offering costs | -49,323 | ' | -9,938 | ' | ' | ' | -9,938 | -39,385 |
Distributions ($0.70 per share) | -19,640,369 | ' | ' | -19,640,369 | ' | ' | -19,640,369 | ' |
Distributions to noncontrolling interests | -222,008 | ' | ' | ' | ' | ' | ' | -222,008 |
Issuance of shares for distribution reinvestment plan | 9,131,346 | 891 | 9,130,455 | ' | ' | ' | 9,131,346 | ' |
Issuance of shares for distribution reinvestment plan (in shares) | ' | 891,349 | ' | ' | ' | ' | ' | ' |
Reduction of noncontrolling interests through additional investment | -7,938,261 | ' | -2,363,697 | ' | ' | ' | -2,363,697 | -5,574,564 |
Issuance of limited partnership units in our Operating Partnership | 2,120,000 | ' | ' | ' | ' | ' | ' | 2,120,000 |
Stock based compensation expense | 12,473 | ' | 12,473 | ' | ' | ' | 12,473 | ' |
Net income attributable to Strategic Storage Trust, Inc. | 399,538 | ' | ' | ' | 399,538 | ' | 399,538 | ' |
Net income attributable to the noncontrolling interests | 10,043 | ' | ' | ' | ' | ' | ' | 10,043 |
Foreign currency translation adjustment | 243,212 | ' | ' | ' | ' | 243,212 | 243,212 | ' |
Change in fair value of interest rate swap | 135,848 | ' | ' | ' | ' | 135,848 | 135,848 | ' |
Ending Balance at Jun. 30, 2014 | $301,181,405 | $57,027 | $493,801,866 | ($126,730,385) | ($68,976,663) | ($1,236,683) | $296,915,162 | $4,266,243 |
Ending Balance, (in shares) at Jun. 30, 2014 | 57,027,784 | 57,027,784 | ' | ' | ' | ' | ' | ' |
Consolidated_Statement_of_Equi1
Consolidated Statement of Equity (Unaudited) (Parenthetical) (USD $) | 6 Months Ended |
Jun. 30, 2014 | |
Statement Of Stockholders Equity [Abstract] | ' |
Distributions, per share | $0.70 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (Unaudited) (USD $) | 6 Months Ended | |
Jun. 30, 2014 | Jun. 30, 2013 | |
Cash flows from operating activities: | ' | ' |
Net income (loss) | $409,581 | ($4,116,558) |
Adjustments to reconcile net income (loss) to cash provided by operating activities: | ' | ' |
Depreciation and amortization expense | 13,471,220 | 13,687,470 |
Noncash interest expense | -50,123 | 91,167 |
Expense related to issuance of restricted stock | 12,473 | 12,224 |
Equity in income of unconsolidated joint ventures | -390,032 | -402,033 |
Distributions from unconsolidated joint ventures | 447,000 | 440,673 |
Foreign currency exchange (gain) loss | -84,513 | 320,443 |
Increase (decrease) in cash from changes in assets and liabilities: | ' | ' |
Restricted cash | 508,160 | -1,077,980 |
Other assets | 359,433 | 179,600 |
Accounts payable and other accrued liabilities | 398,143 | 1,121,125 |
Due to affiliates | -364,431 | -907,482 |
Net cash flows provided by operating activities | 14,716,911 | 9,348,649 |
Cash flows from investing activities: | ' | ' |
Purchase of real estate | -15,024,304 | ' |
Additions to real estate facilities | -1,531,597 | -2,009,284 |
Development and construction of real estate facilities | -3,756,382 | -5,590,436 |
Deposits on acquisitions of real estate facilities | ' | -202,283 |
Additional investment in noncontrolling interests | -5,819,331 | ' |
Net cash flows used in investing activities | -26,131,614 | -7,802,003 |
Cash flows from financing activities: | ' | ' |
Proceeds from issuance of secured debt | 18,000,000 | 7,491,229 |
Principal payments on secured debt | -2,067,183 | -1,692,122 |
Repayment of secured debt | -9,095,098 | -9,595,526 |
Deferred financing costs | -452,778 | -158,854 |
Gross proceeds from issuance of common stock | ' | 43,280,312 |
Offering costs | -49,323 | -4,611,596 |
Redemptions of common stock | ' | -6,952,304 |
Distributions paid | -10,572,502 | -9,145,590 |
Distributions paid to noncontrolling interests | -200,402 | -146,639 |
Escrow receivable | ' | 178,085 |
Due to affiliates | -54,886 | -69,238 |
Net cash flows provided by (used in) financing activities | -4,492,172 | 18,577,757 |
Effect of exchange rate changes on cash | 29,355 | -65,282 |
Increase (decrease) in cash and cash equivalents | -15,877,520 | 20,059,121 |
Cash and cash equivalents, beginning of period | 39,603,949 | 13,998,391 |
Cash and cash equivalents, end of period | 23,726,429 | 34,057,512 |
Supplemental cash flow and non-cash transactions: | ' | ' |
Cash paid for interest | 9,447,299 | 9,418,893 |
Interest capitalized | 340,396 | 252,541 |
Distributions payable | 3,312,939 | 2,851,534 |
Issuance of shares pursuant to distribution reinvestment plan | 9,131,346 | 7,264,595 |
Issuance of limited partnership units in our Operating Partnership in connection with additional investment in noncontrolling interests | 2,120,000 | ' |
Foreign currency translation adjustment - Real estate facilities, net | $280,453 | ($1,667,603) |
Organization
Organization | 6 Months Ended |
Jun. 30, 2014 | |
Accounting Policies [Abstract] | ' |
Organization | ' |
Note 1. Organization | |
Strategic Storage Trust, Inc., a Maryland corporation (the “Company”), was formed on August 14, 2007 under the Maryland General Corporation Law for the purpose of engaging in the business of investing in self storage facilities. The Company’s year-end is December 31. As used in this report, “we” “us” and “our” refer to Strategic Storage Trust, Inc. | |
Strategic Capital Holdings, LLC, a Virginia limited liability company (our “Sponsor”), is our sponsor. Our Sponsor was formed on July 21, 2004 to engage in private structured offerings of limited partnerships and other entities with respect to the acquisition, management and disposition of commercial real estate assets. Our Sponsor owns a majority of Strategic Storage Holdings, LLC, which is the sole member of both our advisor and our property manager. | |
Our advisor is Strategic Storage Advisor, LLC, a Delaware limited liability company (our “Advisor”) which was formed on August 13, 2007. Our Advisor is responsible for managing our affairs on a day-to-day basis and identifying and making acquisitions and investments on our behalf under the terms of an advisory agreement we have with our Advisor (our “Advisory Agreement”). Some of the officers of our Advisor are also officers of our Sponsor and of us. | |
On August 24, 2007, our Advisor purchased 100 shares of our common stock for $1,000 and became our initial stockholder. Our Articles of Amendment and Restatement authorize 700,000,000 shares of common stock with a par value of $0.001 and 200,000,000 shares of preferred stock with a par value of $0.001. | |
Our operating partnership, Strategic Storage Operating Partnership, L.P., a Delaware limited partnership (our “Operating Partnership”), was formed on August 14, 2007. On August 24, 2007, our Advisor purchased a limited partnership interest in our Operating Partnership for $200,000 and on August 24, 2007, we contributed the initial $1,000 capital contribution we received to our Operating Partnership in exchange for the general partner interest. Our Operating Partnership owns, directly or indirectly through one or more special purpose entities, all of the self storage properties that we have acquired. As of June 30, 2014, we owned 98.87% of the limited partnership interests of our Operating Partnership. The remaining limited partnership interests are owned by our Advisor (0.03%) and unaffiliated third parties (1.10%). As the sole general partner of our Operating Partnership, we have the exclusive power to manage and conduct business of our Operating Partnership. We will conduct certain activities (such as selling packing supplies and locks and renting trucks or other moving equipment) through our taxable REIT subsidiaries (the “TRSs”), which are our wholly-owned subsidiaries. | |
Our property manager is Strategic Storage Property Management, LLC, a Delaware limited liability company (our “Property Manager”), which was formed in August 2007 to manage our properties. Our Property Manager derives substantially all of its income from the property management services it performs for us. | |
On March 17, 2008, we began our initial public offering of common stock (our “Initial Offering”). On May 22, 2008, we satisfied the minimum offering requirements of the Initial Offering and commenced formal operations. On September 16, 2011, we terminated the Initial Offering, having sold approximately 29 million shares for gross proceeds of approximately $289 million. On September 22, 2011, we commenced our follow-on public offering of stock for a maximum of 110,000,000 shares of common stock, consisting of 100,000,000 shares for sale to the public (our “Primary Offering”) and 10,000,000 shares for sale pursuant to our distribution reinvestment plan (collectively, our “Offering”). Our Offering terminated on September 22, 2013, having sold approximately 25 million shares for gross proceeds of approximately $256 million. On September 18, 2013, our board of directors amended and restated our distribution reinvestment plan, effective September 28, 2013, to make certain minor revisions related to the closing of our Offering. Following the termination of our Offering, on September 23, 2013, we filed with the SEC a Registration Statement on Form S-3, which incorporated the amended and restated distribution reinvestment plan and registered up to an additional $51.25 million in shares under our amended and restated distribution reinvestment plan (our “DRP Offering”). The DRP Offering may be terminated at any time upon 10 days’ prior written notice to stockholders. As of June 30, 2014, we had sold approximately 55 million shares of common stock for gross proceeds of approximately $558 million under all of our offerings. | |
In connection with the close-down of our Offering and in light of current market conditions, our board of directors has been and is continuing to explore certain strategic alternatives to create stockholder liquidity. Our management and our board of directors are also exploring the possibility of becoming self-administered. However, there can be no assurance that the exploration of any strategic alternatives will result in any particular outcome. In anticipation of potential strategic alternatives, on November 1, 2013, our board of directors approved the termination of our share redemption program, effective December 1, 2013. | |
Our dealer manager was Select Capital Corporation, a California corporation (our “Dealer Manager”). Our Dealer Manager was responsible for marketing our shares that were offered pursuant to the Offering. Our chief executive officer, through a wholly-owned limited liability company, owns a 15% non-voting equity interest in our Dealer Manager. | |
As we accepted subscriptions for shares of our common stock, we transferred substantially all of the net offering proceeds to our Operating Partnership as capital contributions in exchange for additional units of interest in our Operating Partnership. However, we were deemed to have made capital contributions in the amount of the gross offering proceeds received from investors, and our Operating Partnership was deemed to have simultaneously paid the sales commissions and other costs associated with the Offering. In addition, our Operating Partnership is structured to make distributions with respect to limited partnership units (except for Class D units) that will be equivalent to the distributions made to holders of our common stock. In March 2011, we adopted Amendment No. 1 to our Operating Partnership’s First Amended and Restated Limited Partnership Agreement, which established Class D Units, and our Operating Partnership issued approximately 120,000 Class D Units in connection with our acquisition of the Las Vegas VII and Las Vegas VIII properties. The Class D Units have all of the rights, powers, duties and preferences of our Operating Partnership’s other limited partnership units, except that they are subject to a distribution limit and the holders of the Class D Units have agreed to modified exchange rights that prevent them from exercising their exchange rights until the occurrence of a specified event (see Note 8). The distribution for the Class D units was initially zero, but was set to an annualized rate of $0.70 per unit as of April 1, 2014. Finally, a limited partner in our Operating Partnership may later exchange his or her limited partnership units in our Operating Partnership for shares of our common stock at any time after one year following the date of issuance of their limited partnership units, subject to certain restrictions as outlined in the limited partnership agreement. Our Advisor is prohibited from exchanging or otherwise transferring its limited partnership units so long as it is acting as our Advisor pursuant to our Advisory Agreement. | |
As of June 30, 2014, we owned 126 self storage facilities (125 were wholly owned and one was 99% owned by us) located in 17 states (Alabama, Arizona, California, Florida, Georgia, Illinois, Kentucky, Mississippi, Nevada, New Jersey, New York, North Carolina, Pennsylvania, South Carolina, Tennessee, Texas and Virginia) and Canada comprising approximately 80,325 units and approximately 10.5 million rentable square feet. As of June 30, 2014, we also had noncontrolling interests in two additional self storage facilities. Additionally, we had an interest in a net leased industrial property in California with 356,000 rentable square feet leased to a single tenant, which was sold on July 31, 2014, see Note 11, Subsequent Events, for additional information. |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 6 Months Ended | ||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||||||
Summary of Significant Accounting Policies | ' | ||||||||||||||||
Note 2. Summary of Significant Accounting Policies | |||||||||||||||||
Basis of Presentation | |||||||||||||||||
The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) as contained within the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) and the rules and regulations of the SEC. | |||||||||||||||||
Effective September 15, 2009, the ASC was established as the single source of authoritative nongovernmental GAAP. Prior to the issuance of the ASC, all GAAP pronouncements were issued in separate topical pronouncements in the form of statements, staff positions or Emerging Issues Task Force Abstracts, and were referred to as such. While the ASC does not change GAAP, it introduces a new structure and supersedes all previously issued non-SEC accounting and reporting standards. In addition to the ASC, the Company is still required to follow SEC rules and regulations relating to the preparation of financial statements. The Company’s accounting policies are consistent with the guidance set forth by both the ASC and the SEC. | |||||||||||||||||
Reclassifications | |||||||||||||||||
Certain amounts previously reported in our 2013 financial statements have been reclassified to conform to the fiscal 2014 presentation. | |||||||||||||||||
Principles of Consolidation | |||||||||||||||||
Our financial statements, the financial statements of our Operating Partnership, including its wholly-owned subsidiaries, the financial statements of Self Storage REIT (REIT I) and Self Storage REIT II (REIT II), and the accounts of variable interest entities (VIEs) for which we are the primary beneficiary are consolidated in the accompanying consolidated financial statements. The portion of these entities not wholly-owned by us is presented as noncontrolling interests both as of and during the periods presented. All significant intercompany accounts and transactions have been eliminated in consolidation. | |||||||||||||||||
Consolidation Considerations for Our Investments in Joint Ventures | |||||||||||||||||
Current accounting guidance provides a framework for identifying VIEs and determining when a company should include the assets, liabilities, noncontrolling interests, and results of activities of the VIE in its consolidated financial statements. In general, a VIE is an entity or other legal structure used to conduct activities or hold assets that either (1) has an insufficient amount of equity to carry out its principal activities without additional subordinated financial support, (2) has a group of equity owners that are unable to make significant decisions about its activities, or (3) has a group of equity owners that do not have the obligation to absorb losses or the right to receive returns generated by its operations. Generally, a VIE should be consolidated if a party with an ownership, contractual, or other financial interest in the VIE (a variable interest holder) has the power to direct the VIE’s most significant activities and the obligation to absorb losses or right to receive benefits of the VIE that could be significant to the VIE. A variable interest holder that consolidates the VIE is called the primary beneficiary. Upon consolidation, the primary beneficiary generally must initially record all of the VIE’s assets, liabilities, and noncontrolling interest at fair value and subsequently account for the VIE as if it were consolidated based on majority voting interest. As of June 30, 2014 and December 31, 2013, we had entered into contracts/interests that were deemed to be variable interests in VIEs; those variable interests included both lease agreements and equity investments. We evaluated those variable interests against the criteria for consolidation and determined that we are not the primary beneficiary of certain investments discussed further in the “Equity Investments” section of this note. | |||||||||||||||||
As of December 31, 2013, we had an equity interest in a self storage property located in San Francisco, California (“SF property”) which was deemed to be a VIE of which we were the primary beneficiary. As such, the SF property was consolidated in our consolidated financial statements since the date we first acquired our interest in the property through the REIT I merger. In January 2010, we acquired an approximately 2% additional interest in the SF property, bringing our then total interest to approximately 12%. The SF property is owned by a Delaware Statutory Trust (DST), and by virtue of the trust agreement the investors in the trust did not have the direct or indirect ability through voting rights to make decisions about the DST’s significant activities. The REIT I operating partnership (the “REIT I Operating Partnership”) had also entered into a lease agreement for the SF property, in which the REIT I Operating Partnership was the tenant, which exposed it to losses of the VIE that could be significant to the VIE and also allowed it to direct activities of the VIE that determined its economic performance by means of its operation of the leased facility. In connection with the REIT I merger, our Sponsor entered into an agreement to indemnify us for any losses as a result of potential shortfalls in the lease payments required to be made by the REIT I Operating Partnership. Despite such indemnification, we were deemed to be the primary beneficiary, as our Sponsor was not deemed to have a variable interest in the SF property. | |||||||||||||||||
During January and February 2014, we acquired an additional approximately 86% of interests in the SF property from approximately 45 third-party sellers bringing our total interest to approximately 98%. During May 2014, we acquired an additional approximately 1% from one third-party seller, bringing our current ownership to approximately 99%. Given that we had consolidated the SF property since we acquired the original interest, the acquisition of interests during 2014 were treated as acquisitions of noncontrolling interests and the SF property has since been consolidated as a majority owned subsidiary whereas we previously consolidated it as a VIE. For additional discussion, see Note 3. | |||||||||||||||||
Use of Estimates | |||||||||||||||||
The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. The current economic environment has increased the degree of uncertainty inherent in these estimates and assumptions. Management adjusts such estimates when facts and circumstances dictate. The most significant estimates made include the allocation of property purchase price to tangible and intangible assets acquired and liabilities assumed at fair value, the determination if certain entities should be consolidated, the evaluation of potential impairment of long-lived assets and of assets held by equity method investees, and the useful lives of real estate assets and intangibles. Actual results could materially differ from those estimates. | |||||||||||||||||
Cash and Cash Equivalents | |||||||||||||||||
We consider all short-term, highly liquid investments that are readily convertible to cash with a maturity of three months or less at the time of purchase to be cash equivalents. | |||||||||||||||||
We may maintain cash equivalents in financial institutions in excess of insured limits, but believe this risk is mitigated by only investing in or through major financial institutions. | |||||||||||||||||
Restricted Cash | |||||||||||||||||
Restricted cash consists primarily of impound reserve accounts for property taxes, insurance and capital improvements in connection with the requirements of certain of our loan agreements. | |||||||||||||||||
Real Estate Purchase Price Allocation | |||||||||||||||||
We account for acquisitions in accordance with accounting guidance which requires that we allocate the purchase price of the property to the tangible and intangible assets acquired and the liabilities assumed based on estimated fair values. This guidance requires us to make significant estimates and assumptions, including fair value estimates, as of the acquisition date and to adjust those estimates as necessary during the measurement period (defined as the period, not to exceed one year, in which we may adjust the provisional amounts recognized for an acquisition). Acquisitions of portfolios of facilities are allocated to the individual facilities based upon an income approach or a cash flow analysis using appropriate risk adjusted capitalization rates which take into account the relative size, age, and location of the individual facility along with current and projected occupancy and rental rate levels or appraised values, if available. Allocations to the individual assets and liabilities are based upon comparable market sales information for land and estimates of depreciated replacement cost of equipment, building and site improvements. In allocating the purchase price, we determine whether the acquisition includes intangible assets or liabilities. Substantially all of the leases in place at acquired properties are at market rates, as the majority of the leases are month-to-month contracts. Accordingly, to date we have not allocated any portion of the purchase price to above or below market leases. We also consider whether in-place, market leases represent an intangible asset. We preliminarily recorded approximately $1.3 million in intangible assets to recognize the value of in-place leases related to our acquisitions during the first six months of 2014. We do not expect, nor to date have we recorded, intangible assets for the value of customer relationships because we will not have concentrations of significant customers and the average customer turnover is fairly frequent. Our acquisition-related transaction costs are required to be expensed as incurred. During the three months ended June 30, 2014 and 2013, we expensed approximately $0.7 million and $0.2 million, respectively, of acquisition related transaction costs and during the six months ended June 30, 2014 and 2013, we expensed approximately $1.4 and $0.3 million, respectively, of acquisition related transaction costs. | |||||||||||||||||
Should the initial accounting for an acquisition be incomplete by the end of a reporting period that falls within the measurement period, we report provisional amounts in our financial statements. During the measurement period, we adjust the provisional amounts recognized at the acquisition date to reflect new information obtained about facts and circumstances that existed as of the acquisition date that, if known, would have affected the measurement of the amounts recognized as of that date and we record those adjustments to our financial statements. We apply those measurement period adjustments that we determine to be significant retrospectively to comparative information in our financial statements, potentially including adjustments to interest, depreciation and amortization expense. | |||||||||||||||||
Evaluation of Possible Impairment of Long-Lived Assets | |||||||||||||||||
Management will continually monitor events and changes in circumstances that could indicate that the carrying amounts of our long-lived assets, including those held through joint ventures, may not be recoverable. When indicators of potential impairment are present that indicate that the carrying amounts of the assets may not be recoverable, we will assess the recoverability of the assets by determining whether the carrying value of the long-lived assets will be recovered through the undiscounted future operating cash flows expected from the use of the asset and its eventual disposition. In the event that such expected undiscounted future cash flows do not exceed the carrying value, we will adjust the value of the long-lived assets to the fair value and recognize an impairment loss. As of June 30, 2014 and December 31, 2013, no impairment losses have been recognized. | |||||||||||||||||
Equity Investments | |||||||||||||||||
Our investments in unconsolidated real estate joint ventures and VIEs in which we are not the primary beneficiary, where we have significant influence, but not control, are recorded under the equity method of accounting in the accompanying consolidated financial statements. Under the equity method, our investments in real estate ventures are stated at cost and adjusted for our share of net earnings or losses and reduced by distributions. Equity in earnings of real estate ventures is generally recognized based on the allocation of cash distributions upon liquidation of the investment in accordance with the joint venture agreements. | |||||||||||||||||
Investments representing passive preferred equity and/or noncontrolling interests are accounted for under the cost method. Under the cost method, our investments in real estate ventures are carried at cost and adjusted for other-than-temporary declines in fair value, distributions representing a return of capital and additional investments. | |||||||||||||||||
Through mergers with REIT I and REIT II in 2009, we acquired preferred equity and/or noncontrolling interests in unconsolidated joint ventures all of which were deemed to be VIEs. We currently have two such interests and have evaluated each against the amended criteria for consolidation and determined that we are not the primary beneficiary, generally due to our inability to direct significant activities that determine the economic performance of the VIE. One of those investments is a passive or limited partner interest in two self storage facilities (such properties are owned by a DST, and by virtue of the related trust agreements, the investors have no direct or indirect ability through voting rights to make decisions about its significant activities) and is therefore accounted for under the cost method; our aggregate investment therein is approximately $0.1 million. Our ownership interest in such investment was approximately 1.49% and our risk of loss is limited to our investment therein. | |||||||||||||||||
The other interest is in a net leased industrial property (“Hawthorne Property”) in California with 356,000 rentable square feet leased to a single tenant. This investment is accounted for under the equity method of accounting and our risk of loss is limited to our investment, including our maximum exposure under the terms of a debt guarantee. We own a 12% interest in Westport LAX LLC, the joint venture that acquired the Hawthorne Property and the carrying value in such investment is approximately $1.3 million. Hawthorne LLC, an affiliate of our Sponsor, owns 78% of Westport LAX LLC, and we have a preferred equity interest in Hawthorne LLC which entitles us to distributions equal to 10% per annum on our investment of approximately $6.9 million and a non-interest bearing receivable of approximately $0.4 million. The preferred equity interest has a redemption date in November 2014, subject to extension at our sole discretion. The preferred equity interest may be called at any time in whole or part by Hawthorne LLC or redeemed at any time by us. The remaining 10% interest in Westport LAX LLC is owned by a third party, who is also the co-manager, along with our Sponsor, of the Hawthorne Property. Such third party is the acting property manager and directs the operating activities of the property that determine its economic performance. We, along with other non-affiliated parties, are guarantors on the approximately $18.7 million loan used to secure the Hawthorne Property; the loan has a maturity date of August 1, 2020. As of June 30, 2014, our maximum exposure to loss as a result of our involvement with this VIE, consisting of our investment balances and our guarantee of the secured debt, totaled approximately $27.3 million. On July 31, 2014 the Hawthorne Property was sold. See Note 11, Subsequent Events, for additional information. | |||||||||||||||||
Revenue Recognition | |||||||||||||||||
Management believes that all of our leases are operating leases. Rental income is recognized in accordance with the terms of the leases, which generally are month-to-month. Revenues from any long-term operating leases are recognized on a straight-line basis over the term of the lease. The excess of rents received over amounts contractually due pursuant to the underlying leases is included in accounts payable and accrued liabilities in our consolidated balance sheets and contractually due but unpaid rent is included in other assets. | |||||||||||||||||
Allowance for Doubtful Accounts | |||||||||||||||||
Tenant accounts receivable are reported net of an allowance for doubtful accounts. Management’s estimate of the allowance is based upon a review of the current status of tenant accounts receivable. It is reasonably possible that management’s estimate of the allowance will change in the future. | |||||||||||||||||
Real Estate Facilities | |||||||||||||||||
Real estate facilities are recorded at cost. We capitalize costs incurred to develop, construct, renovate and improve properties, including interest and property taxes incurred during the construction period. The construction period begins when expenditures for the real estate assets have been made and activities that are necessary to prepare the asset for its intended use are in progress. The construction period ends when the asset is substantially complete and ready for its intended use. | |||||||||||||||||
Depreciation of Real Property Assets | |||||||||||||||||
Our management is required to make subjective assessments as to the useful lives of our depreciable assets. We consider the period of future benefit of the asset to determine the appropriate useful lives. | |||||||||||||||||
Depreciation of our real property assets is charged to expense on a straight-line basis over the estimated useful lives as follows: | |||||||||||||||||
Description | Standard Depreciable Life | ||||||||||||||||
Land | Not Depreciated | ||||||||||||||||
Buildings | 30 to 35 years | ||||||||||||||||
Site Improvements | 7 to 15 years | ||||||||||||||||
Depreciation of Personal Property Assets | |||||||||||||||||
Personal property assets, consisting primarily of furniture, fixtures and equipment are depreciated on a straight-line basis over the estimated useful lives generally ranging from 3 to 5 years, and are included in other assets on our consolidated balance sheets. | |||||||||||||||||
Intangible Assets | |||||||||||||||||
We have allocated a portion of our real estate purchase price to in-place leases. We are amortizing in-place leases on a straight-line basis over the estimated future benefit period. As of June 30, 2014 and December 31, 2013, accumulated amortization of in-place lease intangibles totaled approximately $47.7 million and $44.6 million, respectively. | |||||||||||||||||
Amortization of Deferred Financing Costs | |||||||||||||||||
Costs incurred in connection with obtaining financing are deferred and amortized on a straight-line basis over the term of the related loan, which is not materially different than the effective interest method. As of June 30, 2014 and December 31, 2013, accumulated amortization of deferred financing costs totaled approximately $6.5 million and $5.9 million, respectively. | |||||||||||||||||
Foreign Currency Translation | |||||||||||||||||
For non-U.S. functional currency operations, assets and liabilities are translated to U.S. dollars at current exchange rates. Revenues and expenses are translated at the average rates for the period. All related adjustments are recorded in other comprehensive income (loss) as a separate component of equity. Transactions denominated in a currency other than the functional currency of the related operation are recorded at rates of exchange in effect at the date of the transaction. Gains or losses on foreign currency transactions are recorded in other income (expense). For the three and six months ended June 30, 2014, we recorded a gain of approximately $350,000 and $85,000, respectively, and, for the three and six months ended June 30, 2013, we recorded a loss of approximately $210,000 and $320,000, respectively. | |||||||||||||||||
Accounting for Equity Awards | |||||||||||||||||
The cost of restricted stock is required to be measured based on the grant-date fair value and the cost to be recognized over the relevant service period. | |||||||||||||||||
Fair Value Measurements | |||||||||||||||||
The accounting standard for fair value measurements and disclosures defines fair value, establishes a framework for measuring fair value, and provides for expanded disclosure about fair value measurements. Fair value is defined by the accounting standard for fair value measurements and disclosures 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. It also establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three levels. The following summarizes the three levels of inputs and hierarchy of fair value we use when measuring fair value: | |||||||||||||||||
• | Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access; | ||||||||||||||||
• | Level 2 inputs may include quoted prices for similar assets and liabilities in active markets, as well as interest rates and yield curves that are observable at commonly quoted intervals; and | ||||||||||||||||
• | Level 3 inputs are unobservable inputs for the assets or liabilities that are typically based on an entity’s own assumptions as there is little, if any, related market activity. | ||||||||||||||||
In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the fair value measurement will fall within the lowest level that is significant to the fair value measurement in its entirety. | |||||||||||||||||
The accounting guidance for fair value measurements and disclosures provides a framework for measuring fair value and establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. In determining fair value, we utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible as well as consider counterparty credit risk in our assessment of fair value. Considerable judgment is necessary to interpret Level 2 and 3 inputs in determining fair value of our financial and non-financial assets and liabilities. Accordingly, there can be no assurance that the fair values we present herein are indicative of amounts that may ultimately be realized upon sale or other disposition of these assets. | |||||||||||||||||
Financial and non-financial assets and liabilities measured at fair value on a non-recurring basis in our consolidated financial statements consist of real estate and related assets and investments in unconsolidated joint ventures and related liabilities assumed and equity consideration related to our acquisitions. The fair values of these assets, liabilities and equity consideration were determined as of the acquisition dates using widely accepted valuation techniques, including (i) discounted cash flow analysis, which considers, among other things, leasing assumptions, growth rates, discount rates and terminal capitalization rates, (ii) income capitalization approach, which considers prevailing market capitalization rates, and (iii) comparable sales activity. In general, we consider multiple valuation techniques when measuring fair values. However, in certain circumstances, a single valuation technique may be appropriate. All of the fair values of the assets, liabilities and equity consideration as of the acquisition dates were derived using Level 3 inputs. | |||||||||||||||||
The carrying amounts of cash and cash equivalents, customer accounts receivable, other assets, accounts payable and accrued liabilities, distributions payable and amounts due to affiliates approximate fair value because of the relatively short-term nature of these instruments. | |||||||||||||||||
The table below summarizes our fixed rate notes payable at June 30, 2014. The estimated fair value of financial instruments is subjective in nature and is dependent on a number of important assumptions, including discount rates and relevant comparable market information associated with each financial instrument. The fair value of the fixed rate notes payable was estimated by discounting the future cash flows using the current rates at which similar loans would be made to borrowers with similar credit ratings and for the same remaining maturities. The use of different market assumptions and estimation methodologies may have a material effect on the reported estimated fair value amounts. Accordingly, the estimates presented below are not necessarily indicative of the amounts we would realize in a current market exchange. | |||||||||||||||||
June 30, 2014 | December 31, 2013 | ||||||||||||||||
Fair Value | Carrying Value | Fair Value | Carrying Value | ||||||||||||||
Fixed Rate Secured Debt | $ | 000,000,000 | $ | 289,778,742 | $ | 311,362,132 | $ | 300,894,201 | |||||||||
As of June 30, 2014, we had an interest rate swap on one of our loans (See Notes 5 and 6). The valuation of this instrument was determined using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of the derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. The fair values of interest rate swaps are determined using the market standard methodology of netting the discounted future fixed cash payments and the discounted expected variable cash receipts. The variable cash receipts are based on an expectation of future interest rates (forward curves) derived from observable market interest rate curves. | |||||||||||||||||
To comply with GAAP, we incorporate credit valuation adjustments to appropriately reflect both our own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements. In adjusting the fair value of our derivative contracts for the effect of nonperformance risk, we have considered the impact of netting and any applicable credit enhancements, such as collateral postings, thresholds, mutual puts, and guarantees. | |||||||||||||||||
Although we have determined that the majority of the inputs used to value our derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with our derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by us and our counterparties. However, as of June 30, 2014, we have assessed the significance of the impact of the credit valuation adjustments on the overall valuation of our derivative positions and have determined that the credit valuation adjustments are not significant to the overall valuation of our derivatives. As a result, we have determined that our derivative valuations in their entirety are classified in Level 2 of the fair value hierarchy. As of June 30, 2014, we had approximately $167,000 of Level 2 derivatives (interest rate swap) classified in accounts payable and accrued liabilities on our consolidated balance sheet. | |||||||||||||||||
Derivative Instruments and Hedging Activities | |||||||||||||||||
The accounting for changes in the fair value of derivatives depends on the intended use of the derivative and the resulting designation. Derivatives used to hedge exposure to changes in the fair value of an asset, liability or firm commitment attributable to a particular risk are considered fair value hedges. Derivatives used to hedge the exposure to variability in expected future cash flows or other types of forecasted transactions are considered cash flow hedges. | |||||||||||||||||
For derivatives designated as fair value hedges, changes in the fair value of the derivative and the hedged item related to the hedged risk are recognized in the consolidated statements of operations. For derivatives designated as cash flow hedges, the effective portion of changes in the fair value of the derivative is initially reported in other comprehensive income, outside of earnings and subsequently reclassified to earnings when the hedged transaction affects earnings. | |||||||||||||||||
Noncontrolling Interest in Consolidated Entities | |||||||||||||||||
We account for the noncontrolling interest in our Operating Partnership in accordance with amended accounting guidance. Due to our control through our general partnership interest in our Operating Partnership and the limited rights of the limited partner, our Operating Partnership, including its wholly-owned subsidiaries, is consolidated with the Company and the limited partner interest is reflected as a noncontrolling interest in the accompanying consolidated balance sheets. In addition, we account for the noncontrolling interest in the SF property in accordance with the amended accounting guidance. The noncontrolling interests shall continue to be attributed their share of income and losses, even if that attribution results in a deficit noncontrolling interest balance. | |||||||||||||||||
Income Taxes | |||||||||||||||||
We made an election to be taxed as a Real Estate Investment Trust (“REIT”), under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”), commencing with our taxable year ended December 31, 2008. To qualify as a REIT, we must meet certain organizational and operational requirements, including a requirement to distribute at least 90% of the REIT’s ordinary taxable income to stockholders. As a REIT, we generally will not be subject to Federal income tax on taxable income that we distribute to our stockholders. If we fail to qualify as a REIT in any taxable year, we will then be subject to Federal income taxes on our taxable income at regular corporate rates and will not be permitted to qualify for treatment as a REIT for Federal income tax purposes for four years following the year during which qualification is lost unless the IRS grants us relief under certain statutory provisions. Such an event could materially adversely affect our net income and net cash available for distribution to stockholders. However, we believe that we will be organized and operate in such a manner as to qualify for treatment as a REIT and intend to operate in the foreseeable future in such a manner that we will remain qualified as a REIT for Federal income tax purposes. We have concluded that there are no significant uncertain tax positions requiring recognition or disclosure in our consolidated financial statements. | |||||||||||||||||
Even if we qualify for taxation as a REIT, we may be subject to certain state and local taxes on our income and property, and Federal income and excise taxes on our undistributed income. | |||||||||||||||||
We have filed an election to treat the TRSs as taxable REIT subsidiaries. In general, the TRSs may perform additional services for our customers and generally may engage in any real estate or non-real estate related business. The TRSs are subject to corporate Federal and state income tax. The TRSs follow accounting guidance which requires the use of the asset and liability method. Deferred income taxes will represent the tax effect of future differences between the book and tax bases of assets and liabilities. | |||||||||||||||||
Per Share Data | |||||||||||||||||
Basic earnings per share attributable to the Company for all periods presented are computed by dividing net income (loss) by the weighted average number of shares outstanding during the period. Diluted earnings per share are computed by dividing net income (loss) by the weighted average number of shares outstanding, including all restricted stock grants as though fully vested. For the three and six months ended June 30, 2014, 3,750 shares, of unvested restricted stock were included in the diluted weighted average shares. For the three and six months ended June 30, 2013, 3,750 shares of unvested restricted stock were not included in the diluted weighted average shares as such shares were antidilutive. | |||||||||||||||||
Recently Issued Accounting Guidance | |||||||||||||||||
In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU 2014-09 “Revenue from Contracts with Customers” (“ASU 2014-09”) as Accounting Standards Codification (“ASC”) Topic 606. The objective of ASU 2014-09 is to establish a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and will supersede most of the existing revenue recognition guidance, including industry-specific guidance. The core principle is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In applying the new standard, companies will perform a five-step analysis of transactions to determine when and how revenue is recognized. ASU 2014-09 applies to all contracts with customers except those that are within the scope of other topics is the FASB ASC. This ASU is effective for annual reporting periods (including interim periods within those periods) beginning after December 15, 2016 and shall be applied using either a full retrospective or modified retrospective approach. Early adoption is not permitted. We are in the process of evaluating the impact of this standard on our consolidated financial statements and the impact is unknown at this time. |
Southwest_Colonial_DST_and_USA
Southwest Colonial, DST and USA SF Self Storage, DST Acquisitions | 6 Months Ended |
Jun. 30, 2014 | |
Business Combinations [Abstract] | ' |
Southwest Colonial, DST and USA SF Self Storage, DST Acquisitions | ' |
Note 3. Southwest Colonial, DST and USA SF Self Storage, DST Acquisitions | |
Southwest Colonial, DST | |
During the fourth quarter of 2013, we purchased beneficial interests (the “Colonial Interests”) in Southwest Colonial, DST (“Colonial DST”), a Delaware statutory trust sponsored by our Sponsor, from approximately 50 third-party sellers pursuant to separate purchase agreements with each seller. None of the purchases were contingent upon any of the others. Such purchases were fully completed on November 1, 2013. Following the purchase of these interests, we owned 100% of the interests in Colonial DST. The agreed upon purchase price of the Colonial Interests acquired, based on the aggregate appraised value of the five properties owned by Colonial DST was approximately $27.9 million. Consideration provided consisted of approximately $9.0 million in cash along with the issuance of approximately 151,300 limited partnership units in our Operating Partnership and the assumption of an approximately $16.7 million bank loan held by Colonial DST (the “John Hancock Loan”). Colonial DST leased its properties to a master tenant (the “Colonial Tenant”) on a triple-net basis pursuant to a master lease (the “Colonial Lease”). The Colonial Tenant is owned by affiliates of our Sponsor. We and our Sponsor, along with its affiliates, have agreed to assign 100% of the economic benefits and obligations from these properties to us in exchange for indemnification by us for any potential liability incurred subsequent to the assignment by the Sponsor in connection with the Colonial Lease. | |
We incurred acquisition fees due to our Advisor of approximately $340,000 in connection with these acquisitions. | |
Colonial DST owns five self storage facilities located in Texas with an aggregate of approximately 2,805 units and 392,000 rentable square feet. The properties owned by Colonial DST are subject to the John Hancock Loan, which had an aggregate principal balance of approximately $16.7 million as of the acquisition date. The loan bears a fixed interest rate of 6.36% and had an original term of ten years, maturing in June 2018. The loan is secured only by the five properties owned by Colonial DST that obtained such loan. | |
USA SF Self Storage, DST | |
During January and February 2014, through an indirect wholly-owned subsidiary, we closed on the purchase of an additional approximately 86% in beneficial interests (the “SF Interests”) in USA SF Self Storage, DST (the “SF DST”), a Delaware Statutory Trust sponsored by our Sponsor, from approximately 45 third-party sellers pursuant to separate purchase agreements with each seller. None of the purchases were contingent upon any of the others. The agreed upon purchase price of the property relating to the SF Interests acquired was approximately $20 million. | |
The acquisition brought our ownership of the SF DST to approximately 98%, including approximately 12% that we acquired previously in unrelated transactions (See Note 2). The consideration provided was primarily in the form of approximately $5.7 million in cash, an assumption of the pro rata debt of approximately $10.2 million and the issuance of approximately 245,000 limited partnership units in our Operating Partnership. We paid our Advisor approximately $0.2 million in acquisition fees in connection with these acquisitions. | |
During May 2014, we acquired an additional approximately 1% in beneficial interests from one third-party seller, bringing our current ownership to approximately 99%. Given that we had consolidated the SF property since we acquired the original interest, the acquisition of interests during 2014 were treated as acquisitions of noncontrolling interests and the SF property is now consolidated as a majority owned subsidiary whereas we previously consolidated it as a VIE. | |
SF DST, owns a self storage facility located in San Francisco with an aggregate of approximately 1,120 units and 76,000 rentable square feet. | |
SF DST leases its property to a master tenant (the “REIT I Tenant”) on a triple-net basis pursuant to a master lease (the “San Francisco Lease”) that had an original term of ten years and will expire on December 19, 2016. The REIT I Tenant is a wholly-owned subsidiary of us. Under the San Francisco Lease, the REIT I Tenant is required to pay a stated monthly rent equivalent to the monthly debt service payment under the loan, which is paid directly to the lender on behalf of the SF DST, a monthly stated rent, and certain annual bonus rent per the terms of the San Francisco Lease. As a SF DST interest holder, we are entitled to our pro rata share of the total rent less the debt service under the loan. | |
As of June 30, 2014, the SF DST had net real estate assets of approximately $16.5 million, approximately $10 million of secured debt and approximately $0.1 million of noncontrolling interest related to this entity. Such assets are only available to satisfy the obligations of the SF DST. The lenders of the secured debt have no recourse to other Company assets. |
Real_Estate_Facilities
Real Estate Facilities | 6 Months Ended | ||||||||||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||||||||||
Real Estate [Abstract] | ' | ||||||||||||||||||||||||
Real Estate Facilities | ' | ||||||||||||||||||||||||
Note 4. Real Estate Facilities | |||||||||||||||||||||||||
The following summarizes our activity in real estate facilities during the six months ended June 30, 2014: | |||||||||||||||||||||||||
Real estate facilities | |||||||||||||||||||||||||
Balance at December 31, 2013 | $ | 694,138,787 | |||||||||||||||||||||||
Facility acquisitions | 13,744,304 | ||||||||||||||||||||||||
Impact of foreign exchange rate changes | 280,453 | ||||||||||||||||||||||||
Improvements and additions | 1,038,970 | ||||||||||||||||||||||||
Balance at June 30, 2014 | $ | 709,202,514 | |||||||||||||||||||||||
Accumulated depreciation | |||||||||||||||||||||||||
Balance at December 31, 2013 | $ | (46,432,155 | ) | ||||||||||||||||||||||
Depreciation | (9,539,758 | ) | |||||||||||||||||||||||
Balance at June 30, 2014 | $ | (55,971,913 | ) | ||||||||||||||||||||||
The following table summarizes the preliminary purchase price allocation for our acquisitions during the six months ended June 30, 2014: | |||||||||||||||||||||||||
Property | Acquisition | Real Estate | Intangibles | Total(1) | 2014 | 2014 | |||||||||||||||||||
Date | Assets | Revenue(2) | Property | ||||||||||||||||||||||
Operating | |||||||||||||||||||||||||
Income(2)(3) | |||||||||||||||||||||||||
Hampton II – VA | 3/5/14 | $ | 5,930,000 | $ | 770,000 | $ | 6,700,000 | $ | 228,764 | $ | 150,075 | ||||||||||||||
Chandler – AZ | 3/27/14 | 4,375,000 | 510,000 | 4,885,000 | 128,665 | 78,432 | |||||||||||||||||||
Toronto II – ONT(4)(5) | 4/2/14 | 3,439,304 | — | 3,439,304 | — | — | |||||||||||||||||||
Total | $ | 13,744,304 | $ | 1,280,000 | $ | 15,024,304 | $ | 357,429 | $ | 228,507 | |||||||||||||||
(1) | The allocations noted above are based on a preliminary determination of the fair value of the total consideration provided. Such valuations may change as we complete our purchase price accounting. | ||||||||||||||||||||||||
(2) | The operating results of the facilities acquired above have been included in the Company’s statement of operations since their respective acquisition date. | ||||||||||||||||||||||||
(3) | Property operating income excludes corporate general and administrative expenses, asset management fees, interest expense, depreciation, amortization and acquisition expenses. | ||||||||||||||||||||||||
(4) | Allocation (excludes estimated development costs) based on Canadian/U.S. exchange rate as of the date of acquisition. | ||||||||||||||||||||||||
(5) | Property is under construction; therefore the property generated no revenue or operating income as of June 30, 2014. | ||||||||||||||||||||||||
The purchase price allocations included above are preliminary and therefore, subject to change upon the completion of our analysis of appraisals and other information related to the acquisitions. We anticipate finalizing the purchase price allocations by December 31, 2014, as further evaluations are completed and additional information is received from third parties. | |||||||||||||||||||||||||
The above properties were acquired from unaffiliated third parties and were purchased entirely with cash. Total acquisition fees paid to our Advisor for the three and six months ended June 30, 2014 were approximately $0.1 million and $0.6 million, respectively. |
Secured_Debt
Secured Debt | 6 Months Ended | ||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||
Debt Disclosure [Abstract] | ' | ||||||||||||||||
Secured Debt | ' | ||||||||||||||||
Note 5. Secured Debt | |||||||||||||||||
The Company’s secured debt is summarized as follows: | |||||||||||||||||
Carrying value as of: | |||||||||||||||||
Encumbered Property | June 30, | December 31, | Interest | Maturity | |||||||||||||
2014 | 2013 | Rate | Date | ||||||||||||||
Montgomery | $ | 2,653,581 | $ | 2,693,364 | 6.42 | % | 7/1/16 | ||||||||||
Seabrook | 4,406,016 | 4,444,137 | 5.73 | % | 1/1/16 | ||||||||||||
Greenville | 2,207,907 | 2,226,986 | 5.65 | % | 3/1/16 | ||||||||||||
Kemah | 8,666,284 | 8,732,981 | 6.2 | % | 6/1/16 | ||||||||||||
Memphis | 2,445,084 | 2,465,045 | 5.67 | % | 12/1/16 | ||||||||||||
Tallahassee | 7,397,484 | 7,446,178 | 6.16 | % | 8/1/16 | ||||||||||||
Houston | 1,961,286 | 1,981,095 | 5.67 | % | 2/1/17 | ||||||||||||
San Francisco | 10,186,862 | 10,256,163 | 5.84 | % | 1/1/17 | ||||||||||||
Lake Forest | 18,000,000 | 18,000,000 | 6.47 | % | 10/1/17 | ||||||||||||
Las Vegas II | 1,501,554 | 1,511,958 | 5.72 | % | 6/1/17 | ||||||||||||
Pearland | 3,416,319 | 3,438,473 | 5.93 | % | 7/1/17 | ||||||||||||
Daphne | 1,296,109 | 1,381,213 | 5.47 | % | 8/1/20 | ||||||||||||
Mesa | 2,932,407 | 2,968,060 | 5.38 | % | 4/1/15 | ||||||||||||
Riverdale(1) | — | 4,800,000 | 4 | % | 5/14/14 | ||||||||||||
Prudential Portfolio Loan(2)(3) | 30,782,782 | 31,044,708 | 5.42 | % | 9/5/19 | ||||||||||||
Dufferin – Toronto – Ontario, Canada(4) | 6,059,757 | 6,144,911 | 4.74 | % | 4/15/17 | ||||||||||||
Citi Loan(5) | 27,872,420 | 28,077,873 | 5.77 | % | 2/6/21 | ||||||||||||
Bank of America Loan – 1(6) | 4,280,685 | 4,321,842 | 5.18 | % | 11/1/15 | ||||||||||||
Bank of America Loan – 2(7) | 6,486,384 | 6,548,748 | 5.18 | % | 11/1/15 | ||||||||||||
Bank of America Loan – 3(8) | 11,658,609 | 11,770,704 | 5.18 | % | 11/1/15 | ||||||||||||
Prudential – Long Beach(9) | 6,479,404 | 6,533,640 | 5.27 | % | 9/5/19 | ||||||||||||
SF Bay Area – Vallejo(10) | — | 4,295,098 | 6.04 | % | 6/1/14 | ||||||||||||
Citi Las Vegas Loan(11) | 7,375,207 | 7,434,590 | 5.26 | % | 6/6/21 | ||||||||||||
ING Loan(12) | 21,097,702 | 21,265,500 | 5.47 | % | 7/1/21 | ||||||||||||
Ladera Ranch | 6,622,832 | 6,691,304 | 5.84 | % | 6/1/16 | ||||||||||||
Las Vegas V | 1,608,570 | 1,628,783 | 5.02 | % | 7/1/15 | ||||||||||||
Mississauga(13) – Ontario, Canada | 6,779,685 | 6,763,769 | 5 | % | 10/31/14 | ||||||||||||
Chantilly(14) | 3,394,147 | 3,421,797 | 4.75 | % | 6/6/22 | ||||||||||||
Brampton(15) – Ontario, Canada | 6,498,136 | 6,482,879 | 5.25 | % | 6/30/16 | ||||||||||||
Citi Stockade Loan – 1(16) | 18,200,000 | 18,200,000 | 4.6 | % | 10/1/22 | ||||||||||||
KeyBank CMBS Loan(17) | 30,726,739 | 30,960,278 | 4.65 | % | 11/1/22 | ||||||||||||
Citi Stockade Loan – 2(18) | 19,362,500 | 19,362,500 | 4.61 | % | 11/6/22 | ||||||||||||
Bank of America Loan – 4(19) | 6,357,269 | 6,394,362 | 6.33 | % | 10/1/17 | ||||||||||||
Citi SF Bay Area – Morgan Hill Loan(20) | 3,000,000 | 3,000,000 | 4.08 | % | 3/6/23 | ||||||||||||
KeyBank Revolver(21) | 89,000,000 | 71,000,000 | 1.66 | % | 10/25/16 | ||||||||||||
John Hancock Loan(22) | 16,538,885 | 16,682,984 | 6.36 | % | 6/1/18 | ||||||||||||
Net fair value adjustment | 863,714 | 913,837 | |||||||||||||||
Total secured debt | $ | 398,116,320 | $ | 391,285,760 | |||||||||||||
(1) | On April 28, 2014, this loan was repaid in full and the related property is now encumbered under the KeyBank Revolver. | ||||||||||||||||
(2) | This portfolio loan is comprised of 11 discrete mortgage loans on 11 respective properties (Manassas, Marietta, Erlanger, Pittsburgh, Weston, Fort Lee, Oakland Park, Tempe, Phoenix II, Davie and Las Vegas I). Each of the individual loans is cross-collateralized by the other ten. | ||||||||||||||||
(3) | Ten of the loans in this portfolio loan bear an interest rate of 5.43%, and the remaining loan bears an interest rate of 5.31%. The weighted average interest rate of this portfolio is 5.42%. | ||||||||||||||||
(4) | On January 12, 2011, we encumbered the Dufferin property with a Canadian dollar denominated loan which bears interest at the bank’s floating rate plus 3.0% (subject to a reduction in certain circumstances). The rate in effect at June 30, 2014 was 4.74%. The maturity date of this loan was extended in May 2014 to April 15, 2017. | ||||||||||||||||
(5) | This portfolio loan encumbers 11 properties (Biloxi, Gulf Breeze I, Alpharetta, Florence II, Jersey City, West Mifflin, Chicago – 95th St., Chicago – Western Ave., Chicago – Ogden Ave., Chicago – Roosevelt Rd. and Las Vegas IV). The net book value of the encumbered properties as of June 30, 2014 was approximately $49.6 million. Such amounts are only available to satisfy the obligations of this loan. | ||||||||||||||||
(6) | This loan encumbers the Lawrenceville I and II properties. | ||||||||||||||||
(7) | This loan encumbers the Concord, Hickory and Morganton properties. | ||||||||||||||||
(8) | This loan encumbers the El Paso II, III, IV & V properties as well as the Dallas property. | ||||||||||||||||
(9) | This loan is cross-collateralized by the 11 properties discussed in footnote (2) to this table. | ||||||||||||||||
(10) | On May 1, 2014, this loan was repaid in full and the related property is now encumbered under the KeyBank Revolver. | ||||||||||||||||
(11) | This loan encumbers the Las Vegas VII and Las Vegas VIII properties. The net book value of the encumbered properties as of June 30, 2014 was approximately $8.9 million. Such amounts are only available to satisfy the obligations of this loan. | ||||||||||||||||
(12) | This portfolio loan is comprised of 11 discrete mortgage loans on 11 respective properties (Peachtree City, Buford, Jonesboro, Ellenwood, Marietta II, Collegeville, Skippack, Ballston Spa, Trenton, Fredericksburg and Sandston). Each of the individual loans had an original term of 30 years and matures on July 1, 2041. ING has the option to require payment of the loan in full every five years beginning on July 1, 2021. | ||||||||||||||||
(13) | In December 2011, we entered into a Canadian dollar denominated construction loan with an aggregate commitment amount of approximately $9.2 million. Such loan bears interest at the bank’s floating rate, plus 2% (totaling 5.0% as of June 30, 2014). | ||||||||||||||||
(14) | The net book value of the Chantilly property as of June 30, 2014 was approximately $6.7 million. Such amounts are only available to satisfy the obligations of this loan. | ||||||||||||||||
(15) | In September 2012, we entered into a Canadian dollar denominated construction loan with an aggregate potential commitment amount of approximately $9.2 million. Such loan bears interest at the bank’s floating rate, plus 2.25% (totaling 5.25% as of June 30, 2014). | ||||||||||||||||
(16) | This portfolio loan encumbers 10 properties (Savannah I, Savannah II, Columbia, Lexington I, Stuart I, Lexington II, Stuart II, Bluffton, Wilmington Island and Myrtle Beach). The net book value of the encumbered properties as of June 30, 2014 was approximately $33.9 million. Such amounts are only available to satisfy the obligations of this loan. | ||||||||||||||||
(17) | This portfolio loan encumbers nine properties (Los Angeles – La Cienega, Las Vegas III, Las Vegas VI, Hampton, SF Bay Area – Gilroy, Toms River, Crescent Springs, Florence and Walton). The net book value of the encumbered properties as of June 30, 2014 was approximately $40.8 million. Such amounts are only available to satisfy the obligations of this loan. | ||||||||||||||||
(18) | This portfolio loan encumbers six properties (Mt. Pleasant I, Charleston I, Charleston II, Mt. Pleasant II, Charleston III, and Mt. Pleasant III). The net book value of the encumbered properties as of June 30, 2014 was approximately $36.1 million. Such amounts are only available to satisfy the obligations of this loan. | ||||||||||||||||
(19) | This loan encumbers the Ridgeland and Canton properties. | ||||||||||||||||
(20) | This loan encumbers the Morgan Hill property. The net book value of the encumbered property as of June 30, 2014 was approximately $5.2 million. Such amount is only available to satisfy the obligations of this loan. | ||||||||||||||||
(21) | On October 28, 2013, through our Operating Partnership and certain property-owning special purpose entities wholly-owned by our Operating Partnership, we entered into the KeyBank Revolver, which matures on October 25, 2016. Such loan encumbers the Homeland Portfolio properties, the Knoxville Portfolio properties and nine other properties (Gulf Breeze II, El Paso I, Toms River II, North Charleston, Phoenix I, Riverdale, SF Bay Area – Vallejo, Hampton II, and Chandler). This loan is a LIBOR based variable rate loan, and such rate is based on 30-day LIBOR, which including the applicable spread equaled an interest rate of 1.66% as of June 30, 2014. The interest rate swap with a notional amount of $45 million that was originally entered into in connection with the Second Restated KeyBank Loan remains outstanding. For additional discussion, see “KeyBank Revolver” below. | ||||||||||||||||
(22) | This loan encumbers the Midland I, Coppell, Midland II, Arlington and Weatherford properties. | ||||||||||||||||
As of June 30, 2014 and December 31, 2013, the Company’s secured promissory notes shown above were secured by the properties shown above, which properties had net book values of approximately $650 million and $647 million, respectively. | |||||||||||||||||
KeyBank Revolver | |||||||||||||||||
On October 28, 2013, through our Operating Partnership and certain property-owning special purpose entities wholly-owned by our Operating Partnership (collectively with the Operating Partnership, the “Borrower”), we obtained a revolving loan from KeyBank, National Association (“KeyBank”) for borrowings up to $75 million (as amended, the “KeyBank Revolver”). The initial amount funded at closing was $71 million (the “Initial Draw”), $45 million of which was used to pay off the outstanding principal amount under the Second Restated KeyBank Loan, and thereby release the 12 properties comprising the Homeland Portfolio that were serving as collateral for the Second Restated KeyBank Loan (discussed below), and approximately $26 million of which was used to partially fund the acquisition of three properties in Knoxville, Tennessee and one in Montgomery, Alabama (the “Knoxville Portfolio”). It is anticipated that future draws on the KeyBank Revolver will be used to help fund our future acquisitions of self storage facilities and for other general corporate purposes. | |||||||||||||||||
During the first quarter of 2014 the aggregate commitment under the Keybank Revolver was increased from $75 million to $100 million. In addition, there is now a total of four participating lenders. | |||||||||||||||||
On April 28, 2014, we borrowed an additional $18 million on the KeyBank Revolver, bringing the total outstanding amount to $89 million. In addition to those properties encumbered as of December 31, 2013, we added as encumbered properties Riverdale, Hampton II, Chandler and SF Bay Area -Vallejo. The proceeds of the borrowings were used to repay the previously outstanding mortgage of approximately $4.8 million on the Riverdale property, the previously outstanding mortgage of approximately $4.3 million on the SF Bay Area -Vallejo property and for general corporate purposes. | |||||||||||||||||
In July 2014, we borrowed an additional $10 million on the KeyBank Revolver, bringing the total outstanding amount to $99 million. See Note 11, Subsequent Events. | |||||||||||||||||
The KeyBank Revolver has an initial term of three years, maturing on October 25, 2016, with two one-year extension options subject to certain conditions outlined further in the credit agreement for the KeyBank Revolver (the “Credit Agreement”). Payments due pursuant to the KeyBank Revolver are interest-only for the life of the loan. The KeyBank Revolver bears interest at the Borrower’s option of either the Alternate Base Rate plus the Applicable Rate or the Adjusted LIBO Rate plus the Applicable Rate (each as defined in the Credit Agreement). The Applicable Rate will vary based on our total leverage ratio. We have elected the Adjusted LIBO Rate plus the Applicable Rate to apply to our balance outstanding. The $45 million interest rate swap originally purchased in connection with the Second Restated KeyBank Loan will remain in place through December 24, 2014, thus fixing the rate on $45 million at approximately 2.4%, assuming the Applicable Rate remains constant. | |||||||||||||||||
During the first 18 months of the KeyBank Revolver, we may request increases in the aggregate commitment up to a maximum of $200 million in minimum increments of $10 million. We may also reduce the aggregate commitment in minimum increments of $10 million during the life of the loan, provided, however, that at no time will the aggregate commitment be reduced to less than $25 million unless the KeyBank Revolver is paid in full. | |||||||||||||||||
The KeyBank Revolver is secured by cross-collateralized first mortgage liens or first lien deeds of trust on the properties in the Homeland Portfolio, the properties in the Knoxville Portfolio, and nine of our other self storage properties, and is cross-defaulted to any recourse debt of $25 million or greater in the aggregate or non-recourse debt of $75 million or greater in the aggregate. The KeyBank Revolver may be prepaid or terminated at any time without penalty, provided, however, that KeyBank and any other lender shall be indemnified for any breakage costs associated with any LIBOR borrowings. Pursuant to that certain guaranty dated October 28, 2013 in favor of KeyBank, we serve as a guarantor of all obligations due under the KeyBank Revolver. | |||||||||||||||||
Under certain conditions, the Borrower may cause the release of one or more of the properties serving as collateral for the KeyBank Revolver in connection with a full or partial pay down of the KeyBank Revolver, provided that there shall at all times be at least four properties serving as collateral. | |||||||||||||||||
The KeyBank Revolver contains a number of other customary terms and covenants, including the following (capitalized terms are as defined in the Credit Agreement): | |||||||||||||||||
• | the aggregate borrowing base availability under the KeyBank Revolver is limited to the lesser of: (1) 60% of the Pool Value of the properties in the collateral pool, or (2) an amount that would provide a minimum Debt Service Coverage Ratio of no less than 1.35 to 1.0; and | ||||||||||||||||
• | we must meet the following financial tests, calculated as of the close of each fiscal quarter: (1) a Total Leverage Ratio of no more than 60%; (2) a Tangible Net Worth of at least $250 million; (3) an Interest Coverage Ratio of no less than 1.85 to 1.0; (4) a Fixed Charge Ratio of no less than 1.6 to 1.0; (5) a ratio of varying rate Indebtedness to total Indebtedness not in excess of 30%; (6) a Loan to Value Ratio of not greater than sixty percent (60%); and (7) a Debt Service Coverage Ratio of not less than 1.35 to 1.0. | ||||||||||||||||
Second Restated KeyBank Loan | |||||||||||||||||
On December 27, 2011, in connection with the acquisition of the Homeland Portfolio (an $80 million portfolio of 10 properties in Atlanta, Georgia and two properties in Jacksonville, Florida), our Operating Partnership and various property owning SPEs entered into a second amended and restated secured credit facility with KeyBank with total commitments of $82 million (such facility replaced our then existing $30 million Restated KeyBank Credit Facility, which had approximately $20 million outstanding before the purchase of the Homeland Portfolio) and we drew down an additional approximately $56.6 million thereunder. On January 12, 2012, we drew down an additional approximately $5.4 million in connection with the repayment of the previously outstanding debt on our Crescent Springs, Florence and Walton properties, bringing the total amount outstanding to $82 million. Such credit facility, as amended (the “Second Restated KeyBank Loan”) was converted from a revolving credit facility to a term loan on August 15, 2012 and the principal balance was reduced on October 10, 2012, from $82 million to $55 million, through the use of the majority of the proceeds from the KeyBank CMBS Loan. | |||||||||||||||||
Beginning on November 30, 2012, we were required to make monthly payments in the amount of $1,666,667 until the outstanding principal balance of the Second Restated KeyBank Loan was reduced to $45 million, which occurred on April 5, 2013. The remaining $45 million was due to mature on December 24, 2014, subject to two, one-year extension options (subject to the fulfillment of certain conditions), and required monthly interest-only payments. | |||||||||||||||||
We were required to purchase an interest rate swap with a notional amount of $45 million, which required us to pay an effective fixed interest rate of approximately 5.41% on the hedged portion of the debt. For the remaining amount outstanding, under the terms of the Second Restated KeyBank Loan, our Operating Partnership had the option of selecting one of three variable interest rates which had applicable spreads. | |||||||||||||||||
The Second Restated KeyBank Loan was paid in full on October 28, 2013 with proceeds from the KeyBank Revolver. | |||||||||||||||||
The following table presents the future principal payment requirements on outstanding secured debt as of June 30, 2014: | |||||||||||||||||
2014 | $ | 8,988,872 | |||||||||||||||
2015 | 31,081,492 | ||||||||||||||||
2016 | 132,883,456 | ||||||||||||||||
2017 | 49,718,520 | ||||||||||||||||
2018 | 18,827,369 | ||||||||||||||||
2019 and thereafter | 155,752,897 | ||||||||||||||||
Total payments | 397,252,606 | ||||||||||||||||
Unamortized fair value adjustment | 863,714 | ||||||||||||||||
Total | $ | 398,116,320 | |||||||||||||||
We record the amortization of debt premiums related to fair value adjustments to interest expense. The weighted average interest rate of the Company’s fixed rate debt as of June 30, 2014 was approximately 5.5%. |
Derivative_Instruments_Cash_Fl
Derivative Instruments - Cash Flow Hedge of Interest Rate Risk | 6 Months Ended | ||||||||||||
Jun. 30, 2014 | |||||||||||||
Derivative Instruments And Hedging Activities Disclosure [Abstract] | ' | ||||||||||||
Derivative Instruments - Cash Flow Hedge of Interest Rate Risk | ' | ||||||||||||
Note 6. Derivative Instruments – Cash Flow Hedge of Interest Rate Risk | |||||||||||||
Our objectives in using interest rate derivatives are to add stability to interest expense and to manage our exposure to interest rate movements. To accomplish this objective, we use interest rate swaps as part of our interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable amounts from a counterparty in exchange for us making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. The effective portion of the change in the fair value of the derivative designated and that qualifies as a cash flow hedge is recorded in accumulated other comprehensive income (“AOCI”) and is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. During 2014 and 2013, such derivatives were used to hedge the variable cash flows associated with existing variable-rate debt. The ineffective portion of the change in fair value of the derivatives is recognized directly in earnings, of which there was none during the three and six months ended June 30, 2014 and 2013. | |||||||||||||
Amounts reported in AOCI related to derivatives will be reclassified to interest expense as interest payments are made on our variable-rate debt. Over the next 12 months, we estimate that approximately $167,000 will be reclassified as an increase to interest expense. | |||||||||||||
As of June 30, 2014, we had one derivative outstanding, which was an interest rate derivative that was designated as a cash flow hedge of interest rate risk: | |||||||||||||
Interest Rate Derivative | Number of | Notional | |||||||||||
Instruments | |||||||||||||
Interest Rate Swap | 1 | $ | 45,000,000 | ||||||||||
The table below presents the fair value of our derivative financial instruments as well as their classification on the consolidated balance sheet as of June 30, 2014 and December 31, 2013: | |||||||||||||
As of June 30, 2014 | As of December 31, 2013 | ||||||||||||
Balance Sheet | Fair Value | Balance Sheet | Fair Value | ||||||||||
Location | Location | ||||||||||||
Interest rate derivatives | |||||||||||||
Assets | Other assets | $ | — | Other assets | $ | — | |||||||
Liabilities | Accounts payable and | $ | 167,203 | Accounts payable and | $ | 303,051 | |||||||
accrued liabilities | accrued liabilities | ||||||||||||
We have agreements with our derivative counterparty that contain a provision where if we either default or are capable of being declared in default, including default where repayment of the indebtedness has not been accelerated, on any of our indebtedness, then we could also be declared in default on our derivative obligations. | |||||||||||||
Certain of our agreements with our derivative counterparties contain provisions where if a specified event or condition (Credit Event Upon Merger) occurs that materially changes our creditworthiness in an adverse manner, we may be required to fully collateralize our obligations under the derivative instrument. As of June 30, 2014, we had not posted any collateral. | |||||||||||||
As of June 30, 2014, the fair value of derivatives in a net liability position, which includes accrued interest but excludes any adjustment for nonperformance risk, related to these agreements was approximately $172,000. If we had breached any of these provisions at June 30, 2014, we could have been required to settle our obligations under the agreements at their termination value of approximately $172,000. |
Related_Party_Transactions
Related Party Transactions | 6 Months Ended | ||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||
Related Party Transactions [Abstract] | ' | ||||||||||||||||
Related Party Transactions | ' | ||||||||||||||||
Note 7. Related Party Transactions | |||||||||||||||||
Fees to Affiliates | |||||||||||||||||
Our Advisory Agreement with our Advisor and dealer manager agreement (“Dealer Manager Agreement”) with our Dealer Manager entitled our Advisor and our Dealer Manager to specified fees upon the provision of certain services with regard to the Offering, as well as reimbursement for organizational and offering costs incurred by our Advisor on our behalf and entitles our Advisor to specified fees upon the investment of funds in real estate properties, among other services and reimbursement of certain costs and expenses incurred by our Advisor in providing services to us. | |||||||||||||||||
Advisory Agreement | |||||||||||||||||
We currently do not have any employees. Our Advisor is primarily responsible for managing our business affairs and carrying out the directives of our board of directors. Our Advisor receives various fees and expenses under the terms of our Advisory Agreement. Our Advisory Agreement also requires our Advisor to reimburse us to the extent that offering expenses, including sales commissions, dealer manager fees and organization and offering expenses, are in excess of 15% of gross proceeds from the Offering. Subsequent to the termination of our Offering on September 22, 2013, we have determined that these expenses did not exceed 15% of gross proceeds from the Offering. In addition, certain organization and offering costs of the Offering were paid by our Advisor on our behalf and reimbursed to our Advisor from the proceeds of the Offering. Organization and offering costs consisted of all expenses (other than sales commissions and the dealer manager fee) paid by us in connection with the Offering, including our legal, accounting, printing, mailing and filing fees, charges of our escrow holder and other accountable offering expenses, including, but not limited to, (i) amounts to reimburse our Advisor for all marketing related costs and expenses such as salaries and direct expenses of employees of our Advisor and its affiliates in connection with registering and marketing our shares; (ii) technology costs associated with the Offering; (iii) our costs of conducting our training and education meetings; (iv) our costs of attending retail seminars conducted by participating broker-dealers; and (v) payment or reimbursement of bona fide due diligence expenses. Our Advisor must reimburse us within 60 days after the end of the month which the Offering terminates to the extent we paid or reimbursed organization and offering costs (excluding sales commissions and dealer manager fees) in excess of 3.5% of the gross offering proceeds from the Primary Offering. Subsequent to the termination of our Offering on September 22, 2013, we have determined that organization and offering costs did not exceed 3.5% of the gross proceeds from the Primary Offering. | |||||||||||||||||
Our Advisor receives acquisition fees equal to 2.5% of the contract purchase price of each property we acquire plus reimbursement of any acquisition expenses the Advisor incurs. Our Advisor also receives a monthly asset management fee equal to one-twelfth of 1.0% of the average of the aggregate asset value, as defined, of our assets, excluding those properties acquired through our mergers with REIT I and REIT II and the SS I, DST, Madison DST, Colonial DST and SF DST acquisitions; provided, however, that if the average of the aggregate asset value, as defined, of our assets exceeds $500 million, the monthly asset management fee shall be reduced to one-twelfth of 0.75% of the average of the aggregate asset value, as defined, of those assets exceeding $500 million unless our modified funds from operations (as defined in the Advisory Agreement), including payment of the fee, is greater than 100% of our distributions in any month (see footnote (2) in the following table for a discussion of the Advisor’s permanent waiver of certain asset management fees). The monthly asset management fees for our properties acquired through our mergers with REIT I and REIT II and the SS I, DST, Madison DST, Colonial DST and SF DST acquisitions are equal to 2.0% of the gross revenues from the properties and are paid to affiliates of our Sponsor. Under our Advisory Agreement, and our articles of incorporation, as amended, our Advisor may receive disposition fees in an amount equal to the lesser of (i) 3.0% of the contract sale price for each property we sell, or (ii) one-half of the competitive real estate commission, as long as our Advisor provides substantial assistance in connection with the sale. The disposition fees paid to our Advisor are subordinated to the receipt of our stockholders of a 6% cumulative, non-compounded, annual return on such stockholders’ invested capital. The total real estate commissions paid (including disposition fee paid to our Advisor) may not exceed the lesser of a competitive real estate commission or an amount equal to 6.0% of the contract sale price of the property. | |||||||||||||||||
Our Advisory Agreement provides for reimbursement of our Advisor’s direct and indirect costs of providing administrative and management services to us (see footnote (1) in the following table for a discussion of the Advisor’s permanent waiver of certain reimbursements for the three and six months ended June 30, 2013). Beginning October 1, 2009 (four fiscal quarters after the acquisition of our first real estate asset), our Advisor must pay or reimburse us the amount by which our aggregate annual operating expenses, as defined, exceed the greater of 2% of our average invested assets or 25% of our net income, as defined, unless a majority of our independent directors determine that such excess expenses were justified based on unusual and non-recurring factors. For any fiscal quarter for which total operating expenses for the 12 months then ended exceed the limitation, we will disclose this fact in our next quarterly report or within 60 days of the end of that quarter and send a written disclosure of this fact to our stockholders. In each case, the disclosure will include an explanation of the factors that the independent directors considered in arriving at the conclusion that the excess expenses were justified. For the three and six months ended June 30, 2014, our aggregate annual operating expenses, as defined, did not exceed the thresholds described above. | |||||||||||||||||
On September 27, 2012, we entered into a Second Amended and Restated Advisory Agreement (the “Amended Advisory Agreement”) with our Advisor. The material terms of the Advisory Agreement were not changed. However, certain provisions were added, the most significant of which was a provision restricting us, during the term of the Amended Advisory Agreement and for a period of two years after the termination of the Amended Advisory Agreement, from soliciting or hiring any employee of, or person performing services on behalf of, our Advisor. | |||||||||||||||||
On March 28, 2014, in a series of related transactions, we entered into an amended and restated advisory agreement (the “Third Amended and Restated Advisory Agreement”) and an amended and restated limited partnership agreement (the “Second Amended and Restated Limited Partnership Agreement”), and REIT I and REIT II entered into amendments to their respective operating partnership agreements, (the “REIT I OP Agreement Amendment” and the “REIT II OP Agreement Amendment,” respectively). REIT I and REIT II are each wholly-owned by our Operating Partnership. | |||||||||||||||||
The Third Amended and Restated Advisory Agreement with our Advisor and our Operating Partnership amended and superseded the Second Amended and Restated Advisory Agreement. Pursuant to the Third Amended and Restated Advisory Agreement, provisions related to various subordinated fees that would be due to our Advisor upon the occurrence of certain events have been removed from such agreement and are now included in the Second Amended and Restated Limited Partnership Agreement of our Operating Partnership. Additionally, our Operating Partnership is now a party to the Third Amended and Restated Advisory Agreement and has provided customary representations and warranties, and certain provisions of the Second Amended and Restated Limited Partnership Agreement are incorporated into the Third Amended and Restated Advisory Agreement. | |||||||||||||||||
The Second Amended and Restated Limited Partnership Agreement with our Operating Partnership and our Advisor amended and superseded the First Amended and Restated Limited Partnership Agreement. Pursuant to the Second Amended and Restated Limited Partnership Agreement, our Advisor and the advisors to REIT I and REIT II have each been granted a special limited partnership interest in our Operating Partnership and are each a party to the Second Amended and Restated Limited Partnership Agreement. In addition, provisions related to various subordinated fees that would be due to our Advisor upon the occurrence of certain events have been included in such agreement and are payable as distributions pursuant to our Advisor’s special limited partnership interest. After giving effect to the Second Amended and Restated Limited Partnership Agreement, the REIT I OP Agreement Amendment, and the REIT II OP Agreement Amendment, our Advisor and the advisors to REIT I and REIT II may be entitled to receive various subordinated distributions, each of which are outlined further in the Second Amended and Restated Limited Partnership Agreement, the REIT I OP Agreement Amendment, and the REIT II OP Agreement Amendment, if we (1) list our shares of common stock on a national exchange, (2) terminate our advisory agreement (other than a voluntary termination by mutual assent), (3) liquidate our portfolio, or (4) enter into an Extraordinary Transaction, as defined in such agreements. In the case of each of the foregoing distributions, our Advisor’s receipt of the distribution is subordinate to return of capital to our stockholders plus at least a 6% cumulative, non-compounded return, and our Advisor’s share of the distribution is 5%, 10%, or 15%, depending on the return level to our stockholders. The receipt of the distribution by the advisors to REIT I and REIT II is subordinate to return of capital to the original REIT I and REIT II stockholders plus at least a 7% cumulative, non-compounded return, and such advisors’ share of the distribution is 15%. In addition, our Advisor may be entitled to a one-time cash distribution in the event that we (1) list our shares of common stock on a national exchange, (2) liquidate our portfolio, or (3) enter into an Extraordinary Transaction resulting in a return to our stockholders in excess of an amount per share that will be determined by our independent directors. Such one-time cash distribution will be paid as part of the complete redemption of our Advisor’s special limited partnership interest in our Operating Partnership and will be up to the aggregate amount of all unreturned and unreimbursed capital invested by our Advisor and its affiliates in us, our Operating Partnership, our Advisor and affiliates, relating in any way to our business or our Operating Partnership’s business or any offering. | |||||||||||||||||
Dealer Manager Agreement | |||||||||||||||||
During the term of our Offering, our Dealer Manager received a sales commission of up to 7.0% of gross proceeds from sales in the Primary Offering and a dealer manager fee equal to up to 3.0% of gross proceeds from sales in the Primary Offering under the terms of our Dealer Manager Agreement. Our Dealer Manager entered into participating dealer agreements with certain other broker-dealers which authorized them to sell our shares. Upon sale of our shares by such broker-dealers, our Dealer Manager re-allowed all of the sales commissions paid in connection with sales made by these broker-dealers. Our Dealer Manager was also permitted to re-allow to these broker-dealers a portion of the 3.0% dealer manager fee as marketing fees, reimbursement of certain costs and expenses of attending training and education meetings sponsored by our Dealer Manager, payment of attendance fees required for employees of our Dealer Manager or other | |||||||||||||||||
affiliates to attend retail seminars and public seminars sponsored by these broker-dealers, or to defray other distribution related expenses. Our Dealer Manager also received reimbursement of bona fide due diligence expenses; however, to the extent these due diligence expenses cannot be justified, any excess over actual due diligence expenses will be considered underwriting compensation subject to a 10% FINRA limitation and, when aggregated with all other non-accountable expenses, may not exceed 3% of gross offering proceeds from sales in the Primary Offering. The Dealer Manager Agreement terminated upon the termination of our Offering. | |||||||||||||||||
Our chief executive officer owns, through a wholly-owned limited liability company, a 15% non-voting equity interest in our Dealer Manager. | |||||||||||||||||
Property Management Agreement | |||||||||||||||||
Our Property Manager receives a fee for its services in managing our properties, generally equal to 6% of the gross revenues from the properties plus reimbursement of the direct costs of managing the properties under our property management agreement. In the event that our Property Manager assists with the development or redevelopment of a property, we may pay a separate market-based fee for such services. As a condition of the REIT II merger transaction, our Property Manager agreed to waive the monthly property management fees for the REIT II properties until the FFO, as defined in the merger agreement, of those properties reached $0.70 per share (which threshold was met in the three months ended March 31, 2013). During the three and six months ended June 30, 2014, property management fees of approximately $67,000 and $132,000, respectively, were recorded relative to the REIT II properties and, for the three and six months ended June 30, 2013, we recorded $60,000 and $85,000, respectively, relative to the REIT II properties. | |||||||||||||||||
On September 27, 2012, our board of directors approved revisions to our property management agreements that will be entered into with respect to properties acquired after that date and will be entered into as our current property management agreements are renewed. These revisions include increasing the term to three years, with automatic three-year extensions; revising the property owner’s obligation to reimburse the Property Manager for certain expenses; the addition of a construction management fee (as defined); the addition of a tenant insurance administrative fee; adding a nonsolicitation provision; and adding a provision regarding the Property Manager’s use of trademarks and other intellectual property owned by Strategic Storage Holdings, LLC. | |||||||||||||||||
Pursuant to the terms of the agreements described above, the following summarizes the related party costs incurred for the three and six months ended June 30, 2014 and 2013: | |||||||||||||||||
Three Months | Three Months | Six Months | Six Months | ||||||||||||||
Ended | Ended | Ended | Ended | ||||||||||||||
June 30, | June 30, | June 30, | June 30, | ||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Expensed | |||||||||||||||||
Reimbursement of operating expenses(1) | $ | 253,558 | $ | 13,956 | $ | 620,904 | $ | 22,101 | |||||||||
Asset management fees(2) | 1,529,666 | 1,181,308 | 3,041,934 | 2,356,940 | |||||||||||||
Property management fees(3)(4) | 1,428,674 | 1,176,105 | 2,803,616 | 2,288,202 | |||||||||||||
Acquisition expenses | 103,703 | 53,010 | 612,245 | 106,619 | |||||||||||||
Additional Paid-in Capital | |||||||||||||||||
Selling commissions | — | 2,084,569 | — | 2,929,034 | |||||||||||||
Dealer Manager fee | — | 893,386 | — | 1,255,300 | |||||||||||||
Reimbursement of offering costs | — | 111,432 | — | 224,129 | |||||||||||||
Total | $ | 3,315,601 | $ | 5,513,766 | $ | 7,078,699 | $ | 9,182,325 | |||||||||
(1) | During the three and six months ended June 30, 2013, our Advisor permanently waived certain reimbursable indirect costs, primarily payroll and related overhead costs, related to administrative and management services, totaling approximately $330,000 and $625,000, respectively. Such amounts were waived permanently and accordingly, will not be paid to our Advisor. Such reimbursable indirect costs were not waived by the Advisor during the three and six months ended June 30, 2014, and totaled approximately $249,000 and $611,000, respectively. | ||||||||||||||||
(2) | During the three and six months ended June 30, 2013, our Advisor permanently waived asset management fees related to the Stockade Portfolio totaling approximately $173,000 and $349,000, respectively. Such amounts were waived permanently and accordingly, will not be paid to our Advisor. Such asset management fees were not waived by the Advisor during the three and six months ended June 30, 2014, and totaled approximately $176,000 and $353,000, respectively. | ||||||||||||||||
(3) | During the three and six months ended June 30, 2013, property management fees included approximately none and $27,000, respectively, of fees paid to the former sub-property manager of our Canadian properties. Such sub-property management agreement was terminated effective March 31, 2013 at a cost of approximately $28,000. | ||||||||||||||||
(4) | During the three and six months ended June 30, 2014 and 2013, our Property Manager permanently waived certain costs, reimbursements and fees, including construction management fees, tenant insurance administration fees and expense reimbursements related to certain off-site property management employees. Such amounts totaled approximately $174,000 and $130,000, respectively for the three months ended June 30, 2014 and 2013, and approximately $356,000 and $280,000, respectively for the six months ended June 30, 2014 and 2013. These amounts were waived permanently and accordingly, will not be paid to our Property Manager. | ||||||||||||||||
As of June 30, 2014 and December 31, 2013, we had amounts due to affiliates totaling $1,299,562 and $1,741,518, respectively. | |||||||||||||||||
Tenant Reinsurance Program | |||||||||||||||||
Beginning in 2011, our Chairman of the Board of Directors, Chief Executive Officer and President, through certain entities, began participating in a tenant reinsurance program whereby tenants of our self storage facilities can purchase insurance to cover damage or destruction to their property while stored at our facilities. Such entities have invested in a Cayman Islands company (the “Reinsurance Company”) that will reinsure a portion of the insurance required by the program insurer to cover the risks of loss at participating facilities in the program. The program insurer provides fees (approximately 50% of the tenant premium paid) to us as owner of the facilities. The Reinsurance Company may be required to fund additional capital or entitled to receive distributions of profits depending on actual losses incurred under the program. For the three months ended June 30, 2014 and 2013, we recorded revenue of approximately $0.5 million and $0.4 million, respectively, in connection with this tenant reinsurance program. For the six months ended June 30, 2014 and 2013, we recorded revenue of approximately $0.9 million and $0.8 million, respectively, in connection with this tenant reinsurance program. | |||||||||||||||||
Storage Auction Program | |||||||||||||||||
During the second quarter of 2013, our Chairman of the Board of Directors, Chief Executive Officer and President, and our Senior Vice President – Property Management and the President of our Property Manager, purchased noncontrolling interests in a company (the “Auction Company”) that serves as a web portal for self storage companies to post their auctions online instead of using live auctions conducted at the self storage facilities. Once the contents of a storage unit are sold at auction, we pay the Auction Company a service fee based upon the sale price of the unit. On January 1, 2014, the Auction Company merged with another similar company. Such officers’ collective ownership in the new combined company is now approximately nine percent. For the three months ended June 30, 2014 and 2013, we incurred approximately $27,000 and $3,000, respectively, in auction fees with the Auction Company. For the six months ended June 30, 2014 and 2013, we incurred approximately $63,000 and $3,000, respectively, in auction fees with the Auction Company. |
Commitments_and_Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2014 | |
Commitments And Contingencies Disclosure [Abstract] | ' |
Commitments and Contingencies | ' |
Note 8. Commitments and Contingencies | |
Distribution Reinvestment Plan | |
We adopted a distribution reinvestment plan that allowed our stockholders to have distributions otherwise distributable to them invested in additional shares of our common stock. The plan became effective on the effective date of our Initial Offering. The purchase price per share was the higher of $9.50 per share or 95% of the fair market value of a share of our common stock. On March 28, 2012, the purchase price per share under the distribution reinvestment plan was changed to 95% of the offering price of our shares. On September 18, 2013, our board of directors amended and restated our distribution reinvestment plan to change the purchase price per share from 95% of the offering price to approximately $10.25 (which resulted in the same price as prior to this amendment and restatement) and make other certain minor revisions related to the closing of our Offering. Our board of directors could set or change the purchase price at any time in its sole and absolute discretion based upon such factors as it deems appropriate. | |
Following the termination of our Offering, on September 22, 2013, we filed with the SEC a Registration Statement on Form S-3, which incorporated the amended and restated distribution reinvestment plan and registered up to an additional $51.25 million in shares. The Form S-3 allows us to continue to offer shares pursuant to our amended and restated distribution reinvestment plan beyond September 22, 2013; however we may amend or terminate the plan at any time upon 10 days’ prior written notice to stockholders. The plan was effective as of September 28, 2013. | |
No sales commission or dealer manager fee will be paid on shares sold through the distribution reinvestment plan. As of June 30, 2014, we have sold approximately 1.3 million shares through our DRP Offering. | |
Operating Partnership Redemption Rights | |
The limited partners of our Operating Partnership have the right to cause our Operating Partnership to redeem their limited partnership units for cash equal to the value of an equivalent number of our shares, or, at our option, we may purchase their limited partnership units by issuing one share of our common stock for each limited partnership unit redeemed. The holders of the Class D Units have agreed to modified exchange rights that prevent them from exercising their exchange rights: (1) until the earlier of (a) a listing of our shares or (b) our merger into another entity whereby our stockholders receive securities listed on a national securities exchange; or (2) until FFO of the properties contributed by the holders of the Class D Units reaches $0.70 per share, based on our fully-loaded cost of equity. These rights may not be exercised under certain circumstances that could cause us to lose our REIT election. Furthermore, limited partners may exercise their redemption rights only after their limited partnership units have been outstanding for one year. Our Advisor is prohibited from exchanging or otherwise transferring its limited partnership units so long as our Sponsor is acting as our sponsor. | |
Ground Lease Commitment – SF Bay Area – San Lorenzo | |
In connection with the acquisition of our SF Bay Area – San Lorenzo property, we assumed a land lease, with a remaining term of approximately 21 years as of June 30, 2014, subject to one 35 year extension option. We recorded rent expense of approximately $37,000 and $74,000, respectively for each of the three and six months ended June 30, 2014 and 2013, respectively. The lease has minimum lease payments of approximately $67,000, $139,000, $139,000, $139,000, $139,000 and $2,415,000 for the years ending 2014, 2015, 2016, 2017, 2018 and thereafter respectively. | |
Other Contingencies | |
We have been involved in routine litigation and threatened litigation arising in the ordinary course of business. While the outcome of any litigation is inherently unpredictable, we believe the likelihood of these pending legal matters having a material adverse effect on our financial condition or results of operations is remote. |
Declaration_of_Distributions
Declaration of Distributions | 6 Months Ended |
Jun. 30, 2014 | |
Text Block [Abstract] | ' |
Declaration of Distributions | ' |
Note 9. Declaration of Distributions | |
On June 25, 2014, our board of directors declared a distribution rate for the third quarter of 2014 of $0.001917808 per day per share on the outstanding shares of common stock payable to stockholders of record of such shares as shown on our books at the close of business on each day during the period, commencing on July 1, 2014 and continuing on each day thereafter through and including September 30, 2014. |
Selected_Quarterly_Data
Selected Quarterly Data | 6 Months Ended | ||||||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ' | ||||||||||||||||||||
Selected Quarterly Data | ' | ||||||||||||||||||||
Note 10. Selected Quarterly Data | |||||||||||||||||||||
The following is a summary of quarterly financial information for the periods shown below: | |||||||||||||||||||||
Three months ended | |||||||||||||||||||||
June 30, | September 30, | December 31, | March 31, | June 30, | |||||||||||||||||
2013 | 2013 | 2013 | 2014 | 2014 | |||||||||||||||||
Total revenues | $ | 19,931,208 | $ | 21,292,574 | $ | 22,503,218 | $ | 23,132,944 | $ | 24,321,406 | |||||||||||
Total operating expenses | $ | 16,667,044 | $ | 17,229,995 | $ | 19,315,207 | $ | 19,105,230 | $ | 18,566,277 | |||||||||||
Operating income | $ | 3,264,164 | $ | 4,062,579 | $ | 3,188,011 | $ | 4,027,714 | $ | 5,755,129 | |||||||||||
Net income (loss) | $ | (1,949,099 | ) | $ | (689,288 | ) | $ | (2,639,352 | ) | $ | (1,039,656 | ) | $ | 1,449,237 | |||||||
Net income (loss) attributable to the Company | $ | (1,949,079 | ) | $ | (693,245 | ) | $ | (2,637,508 | ) | $ | (1,033,683 | ) | $ | 1,433,221 | |||||||
Net income (loss) per share-basic and diluted | $ | (0.04 | ) | $ | (0.01 | ) | $ | (0.05 | ) | $ | (0.02 | ) | $ | 0.03 |
Subsequent_Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2014 | |
Subsequent Events [Abstract] | ' |
Subsequent Events | ' |
Note 11. Subsequent Events | |
Sale of Hawthorne Property | |
On July 31, 2014 the Hawthorne Property, a net leased industrial property in California, was sold to an unaffiliated third party. We owned a 12% interest in Westport LAX LLC, the joint venture that owned the Hawthorne Property. Hawthorne LLC, an affiliate of our Sponsor, owned 78% of Westport LAX LLC, and we had a preferred equity interest in Hawthorne LLC which entitled us to distributions equal to 10% per annum on our investment. The combined carrying value of our investment was approximately $8.6 million and we estimate that we will be entitled to approximately $10.3 million of the net proceeds, upon final distribution of the proceeds from the sale. | |
KeyBank Revolver | |
On July 30, 2014 we borrowed an additional $10 million on the KeyBank Revolver, bringing the total outstanding amount to $99 million. | |
Preferred Equity Investment | |
On July 31, 2014, SSTI Preferred Investor, LLC, (the “SSTI Preferred Investor”) a wholly-owned subsidiary of our Operating Partnership entered into a preferred unit purchase agreement (the “Unit Purchase Agreement”) with SS Growth Operating Partnership, L.P. (the “SSGT Operating Partnership”) and Strategic Storage Growth Trust, Inc. (“SSGT”). SSGT, the parent company of the SSGT Operating Partnership, is a REIT that is currently raising capital through a private placement memorandum and is also in registration to be a non-exchange traded REIT and is sponsored by the parent company of our Advisor and Property Manager. Pursuant to the Unit Purchase Agreement, the SSTI Preferred Investor agreed to provide up to $18,100,000 through a preferred equity investment in the SSGT Operating Partnership (the “Investment”), which amount may be invested in one or more tranches on or before January 31, 2015, to be used for investments in self storage properties, as described in the Unit Purchase Agreement, in exchange for up to an aggregate of 724,000 preferred units of limited partnership interest of the SSGT Operating Partnership (the “Preferred Units”), each having a liquidation preference of $25.00 per Preferred Unit (the “Liquidation Amount”), plus all accumulated and unpaid distributions. The SSTI Preferred Investor will be entitled to current distributions (the “Current Distributions”) at a rate of one-month LIBOR plus 6.5% per annum on the Liquidation Amount, payable monthly and calculated on an actual/360 basis. In addition to the Current Distributions, the SSGT Operating Partnership has the obligation to elect either (A) to pay the SSTI Preferred Investor additional distributions monthly in an amount equal to: (i) 4.35% per annum on the Liquidation Amount through January 31, 2017; and (ii) thereafter, 6.35% per annum on the Liquidation Amount or (B) defer the additional distributions (“Deferred Distribution”), which Deferred Distribution will accumulate monthly in an amount equal to (i) LIBOR plus 10.85% of the Deferred Distribution through January 31, 2017; and (ii) thereafter, LIBOR plus 12.85% of the Deferred Distribution. The Investment is redeemable at the SSTI Preferred Investor’s discretion following certain events set forth in the designation of rights establishing the Preferred Units. | |
On July 31, 2014, the SSTI Preferred Investor invested approximately $7 million in the first tranche of its Investment in the SSGT Operating Partnership. |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 6 Months Ended | ||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||||||
Basis of Presentation | ' | ||||||||||||||||
Basis of Presentation | |||||||||||||||||
The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) as contained within the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) and the rules and regulations of the SEC. | |||||||||||||||||
Effective September 15, 2009, the ASC was established as the single source of authoritative nongovernmental GAAP. Prior to the issuance of the ASC, all GAAP pronouncements were issued in separate topical pronouncements in the form of statements, staff positions or Emerging Issues Task Force Abstracts, and were referred to as such. While the ASC does not change GAAP, it introduces a new structure and supersedes all previously issued non-SEC accounting and reporting standards. In addition to the ASC, the Company is still required to follow SEC rules and regulations relating to the preparation of financial statements. The Company’s accounting policies are consistent with the guidance set forth by both the ASC and the SEC. | |||||||||||||||||
Reclassifications | ' | ||||||||||||||||
Reclassifications | |||||||||||||||||
Certain amounts previously reported in our 2013 financial statements have been reclassified to conform to the fiscal 2014 presentation. | |||||||||||||||||
Principles of Consolidation | ' | ||||||||||||||||
Principles of Consolidation | |||||||||||||||||
Our financial statements, the financial statements of our Operating Partnership, including its wholly-owned subsidiaries, the financial statements of Self Storage REIT (REIT I) and Self Storage REIT II (REIT II), and the accounts of variable interest entities (VIEs) for which we are the primary beneficiary are consolidated in the accompanying consolidated financial statements. The portion of these entities not wholly-owned by us is presented as noncontrolling interests both as of and during the periods presented. All significant intercompany accounts and transactions have been eliminated in consolidation. | |||||||||||||||||
Consolidation Considerations for Our Investments in Joint Ventures | ' | ||||||||||||||||
Consolidation Considerations for Our Investments in Joint Ventures | |||||||||||||||||
Current accounting guidance provides a framework for identifying VIEs and determining when a company should include the assets, liabilities, noncontrolling interests, and results of activities of the VIE in its consolidated financial statements. In general, a VIE is an entity or other legal structure used to conduct activities or hold assets that either (1) has an insufficient amount of equity to carry out its principal activities without additional subordinated financial support, (2) has a group of equity owners that are unable to make significant decisions about its activities, or (3) has a group of equity owners that do not have the obligation to absorb losses or the right to receive returns generated by its operations. Generally, a VIE should be consolidated if a party with an ownership, contractual, or other financial interest in the VIE (a variable interest holder) has the power to direct the VIE’s most significant activities and the obligation to absorb losses or right to receive benefits of the VIE that could be significant to the VIE. A variable interest holder that consolidates the VIE is called the primary beneficiary. Upon consolidation, the primary beneficiary generally must initially record all of the VIE’s assets, liabilities, and noncontrolling interest at fair value and subsequently account for the VIE as if it were consolidated based on majority voting interest. As of June 30, 2014 and December 31, 2013, we had entered into contracts/interests that were deemed to be variable interests in VIEs; those variable interests included both lease agreements and equity investments. We evaluated those variable interests against the criteria for consolidation and determined that we are not the primary beneficiary of certain investments discussed further in the “Equity Investments” section of this note. | |||||||||||||||||
As of December 31, 2013, we had an equity interest in a self storage property located in San Francisco, California (“SF property”) which was deemed to be a VIE of which we were the primary beneficiary. As such, the SF property was consolidated in our consolidated financial statements since the date we first acquired our interest in the property through the REIT I merger. In January 2010, we acquired an approximately 2% additional interest in the SF property, bringing our then total interest to approximately 12%. The SF property is owned by a Delaware Statutory Trust (DST), and by virtue of the trust agreement the investors in the trust did not have the direct or indirect ability through voting rights to make decisions about the DST’s significant activities. The REIT I operating partnership (the “REIT I Operating Partnership”) had also entered into a lease agreement for the SF property, in which the REIT I Operating Partnership was the tenant, which exposed it to losses of the VIE that could be significant to the VIE and also allowed it to direct activities of the VIE that determined its economic performance by means of its operation of the leased facility. In connection with the REIT I merger, our Sponsor entered into an agreement to indemnify us for any losses as a result of potential shortfalls in the lease payments required to be made by the REIT I Operating Partnership. Despite such indemnification, we were deemed to be the primary beneficiary, as our Sponsor was not deemed to have a variable interest in the SF property. | |||||||||||||||||
During January and February 2014, we acquired an additional approximately 86% of interests in the SF property from approximately 45 third-party sellers bringing our total interest to approximately 98%. During May 2014, we acquired an additional approximately 1% from one third-party seller, bringing our current ownership to approximately 99%. Given that we had consolidated the SF property since we acquired the original interest, the acquisition of interests during 2014 were treated as acquisitions of noncontrolling interests and the SF property has since been consolidated as a majority owned subsidiary whereas we previously consolidated it as a VIE. For additional discussion, see Note 3. | |||||||||||||||||
Use of Estimates | ' | ||||||||||||||||
Use of Estimates | |||||||||||||||||
The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. The current economic environment has increased the degree of uncertainty inherent in these estimates and assumptions. Management adjusts such estimates when facts and circumstances dictate. The most significant estimates made include the allocation of property purchase price to tangible and intangible assets acquired and liabilities assumed at fair value, the determination if certain entities should be consolidated, the evaluation of potential impairment of long-lived assets and of assets held by equity method investees, and the useful lives of real estate assets and intangibles. Actual results could materially differ from those estimates. | |||||||||||||||||
Cash and Cash Equivalents | ' | ||||||||||||||||
Cash and Cash Equivalents | |||||||||||||||||
We consider all short-term, highly liquid investments that are readily convertible to cash with a maturity of three months or less at the time of purchase to be cash equivalents. | |||||||||||||||||
We may maintain cash equivalents in financial institutions in excess of insured limits, but believe this risk is mitigated by only investing in or through major financial institutions. | |||||||||||||||||
Restricted Cash | ' | ||||||||||||||||
Restricted Cash | |||||||||||||||||
Restricted cash consists primarily of impound reserve accounts for property taxes, insurance and capital improvements in connection with the requirements of certain of our loan agreements. | |||||||||||||||||
Real Estate Purchase Price Allocation | ' | ||||||||||||||||
Real Estate Purchase Price Allocation | |||||||||||||||||
We account for acquisitions in accordance with accounting guidance which requires that we allocate the purchase price of the property to the tangible and intangible assets acquired and the liabilities assumed based on estimated fair values. This guidance requires us to make significant estimates and assumptions, including fair value estimates, as of the acquisition date and to adjust those estimates as necessary during the measurement period (defined as the period, not to exceed one year, in which we may adjust the provisional amounts recognized for an acquisition). Acquisitions of portfolios of facilities are allocated to the individual facilities based upon an income approach or a cash flow analysis using appropriate risk adjusted capitalization rates which take into account the relative size, age, and location of the individual facility along with current and projected occupancy and rental rate levels or appraised values, if available. Allocations to the individual assets and liabilities are based upon comparable market sales information for land and estimates of depreciated replacement cost of equipment, building and site improvements. In allocating the purchase price, we determine whether the acquisition includes intangible assets or liabilities. Substantially all of the leases in place at acquired properties are at market rates, as the majority of the leases are month-to-month contracts. Accordingly, to date we have not allocated any portion of the purchase price to above or below market leases. We also consider whether in-place, market leases represent an intangible asset. We preliminarily recorded approximately $1.3 million in intangible assets to recognize the value of in-place leases related to our acquisitions during the first six months of 2014. We do not expect, nor to date have we recorded, intangible assets for the value of customer relationships because we will not have concentrations of significant customers and the average customer turnover is fairly frequent. Our acquisition-related transaction costs are required to be expensed as incurred. During the three months ended June 30, 2014 and 2013, we expensed approximately $0.7 million and $0.2 million, respectively, of acquisition related transaction costs and during the six months ended June 30, 2014 and 2013, we expensed approximately $1.4 and $0.3 million, respectively, of acquisition related transaction costs. | |||||||||||||||||
Should the initial accounting for an acquisition be incomplete by the end of a reporting period that falls within the measurement period, we report provisional amounts in our financial statements. During the measurement period, we adjust the provisional amounts recognized at the acquisition date to reflect new information obtained about facts and circumstances that existed as of the acquisition date that, if known, would have affected the measurement of the amounts recognized as of that date and we record those adjustments to our financial statements. We apply those measurement period adjustments that we determine to be significant retrospectively to comparative information in our financial statements, potentially including adjustments to interest, depreciation and amortization expense. | |||||||||||||||||
Evaluation of Possible Impairment of Long-Lived Assets | ' | ||||||||||||||||
Evaluation of Possible Impairment of Long-Lived Assets | |||||||||||||||||
Management will continually monitor events and changes in circumstances that could indicate that the carrying amounts of our long-lived assets, including those held through joint ventures, may not be recoverable. When indicators of potential impairment are present that indicate that the carrying amounts of the assets may not be recoverable, we will assess the recoverability of the assets by determining whether the carrying value of the long-lived assets will be recovered through the undiscounted future operating cash flows expected from the use of the asset and its eventual disposition. In the event that such expected undiscounted future cash flows do not exceed the carrying value, we will adjust the value of the long-lived assets to the fair value and recognize an impairment loss. As of June 30, 2014 and December 31, 2013, no impairment losses have been recognized. | |||||||||||||||||
Equity Investments | ' | ||||||||||||||||
Equity Investments | |||||||||||||||||
Our investments in unconsolidated real estate joint ventures and VIEs in which we are not the primary beneficiary, where we have significant influence, but not control, are recorded under the equity method of accounting in the accompanying consolidated financial statements. Under the equity method, our investments in real estate ventures are stated at cost and adjusted for our share of net earnings or losses and reduced by distributions. Equity in earnings of real estate ventures is generally recognized based on the allocation of cash distributions upon liquidation of the investment in accordance with the joint venture agreements. | |||||||||||||||||
Investments representing passive preferred equity and/or noncontrolling interests are accounted for under the cost method. Under the cost method, our investments in real estate ventures are carried at cost and adjusted for other-than-temporary declines in fair value, distributions representing a return of capital and additional investments. | |||||||||||||||||
Through mergers with REIT I and REIT II in 2009, we acquired preferred equity and/or noncontrolling interests in unconsolidated joint ventures all of which were deemed to be VIEs. We currently have two such interests and have evaluated each against the amended criteria for consolidation and determined that we are not the primary beneficiary, generally due to our inability to direct significant activities that determine the economic performance of the VIE. One of those investments is a passive or limited partner interest in two self storage facilities (such properties are owned by a DST, and by virtue of the related trust agreements, the investors have no direct or indirect ability through voting rights to make decisions about its significant activities) and is therefore accounted for under the cost method; our aggregate investment therein is approximately $0.1 million. Our ownership interest in such investment was approximately 1.49% and our risk of loss is limited to our investment therein. | |||||||||||||||||
The other interest is in a net leased industrial property (“Hawthorne Property”) in California with 356,000 rentable square feet leased to a single tenant. This investment is accounted for under the equity method of accounting and our risk of loss is limited to our investment, including our maximum exposure under the terms of a debt guarantee. We own a 12% interest in Westport LAX LLC, the joint venture that acquired the Hawthorne Property and the carrying value in such investment is approximately $1.3 million. Hawthorne LLC, an affiliate of our Sponsor, owns 78% of Westport LAX LLC, and we have a preferred equity interest in Hawthorne LLC which entitles us to distributions equal to 10% per annum on our investment of approximately $6.9 million and a non-interest bearing receivable of approximately $0.4 million. The preferred equity interest has a redemption date in November 2014, subject to extension at our sole discretion. The preferred equity interest may be called at any time in whole or part by Hawthorne LLC or redeemed at any time by us. The remaining 10% interest in Westport LAX LLC is owned by a third party, who is also the co-manager, along with our Sponsor, of the Hawthorne Property. Such third party is the acting property manager and directs the operating activities of the property that determine its economic performance. We, along with other non-affiliated parties, are guarantors on the approximately $18.7 million loan used to secure the Hawthorne Property; the loan has a maturity date of August 1, 2020. As of June 30, 2014, our maximum exposure to loss as a result of our involvement with this VIE, consisting of our investment balances and our guarantee of the secured debt, totaled approximately $27.3 million. On July 31, 2014 the Hawthorne Property was sold. See Note 11, Subsequent Events, for additional information. | |||||||||||||||||
Revenue Recognition | ' | ||||||||||||||||
Revenue Recognition | |||||||||||||||||
Management believes that all of our leases are operating leases. Rental income is recognized in accordance with the terms of the leases, which generally are month-to-month. Revenues from any long-term operating leases are recognized on a straight-line basis over the term of the lease. The excess of rents received over amounts contractually due pursuant to the underlying leases is included in accounts payable and accrued liabilities in our consolidated balance sheets and contractually due but unpaid rent is included in other assets. | |||||||||||||||||
Allowance for Doubtful Accounts | ' | ||||||||||||||||
Allowance for Doubtful Accounts | |||||||||||||||||
Tenant accounts receivable are reported net of an allowance for doubtful accounts. Management’s estimate of the allowance is based upon a review of the current status of tenant accounts receivable. It is reasonably possible that management’s estimate of the allowance will change in the future. | |||||||||||||||||
Real Estate Facilities | ' | ||||||||||||||||
Real Estate Facilities | |||||||||||||||||
Real estate facilities are recorded at cost. We capitalize costs incurred to develop, construct, renovate and improve properties, including interest and property taxes incurred during the construction period. The construction period begins when expenditures for the real estate assets have been made and activities that are necessary to prepare the asset for its intended use are in progress. The construction period ends when the asset is substantially complete and ready for its intended use. | |||||||||||||||||
Depreciation of Real Property Assets | ' | ||||||||||||||||
Depreciation of Real Property Assets | |||||||||||||||||
Our management is required to make subjective assessments as to the useful lives of our depreciable assets. We consider the period of future benefit of the asset to determine the appropriate useful lives. | |||||||||||||||||
Depreciation of Personal Property Assets | ' | ||||||||||||||||
Depreciation of Personal Property Assets | |||||||||||||||||
Personal property assets, consisting primarily of furniture, fixtures and equipment are depreciated on a straight-line basis over the estimated useful lives generally ranging from 3 to 5 years, and are included in other assets on our consolidated balance sheets. | |||||||||||||||||
Intangible Assets | ' | ||||||||||||||||
Intangible Assets | |||||||||||||||||
We have allocated a portion of our real estate purchase price to in-place leases. We are amortizing in-place leases on a straight-line basis over the estimated future benefit period. As of June 30, 2014 and December 31, 2013, accumulated amortization of in-place lease intangibles totaled approximately $47.7 million and $44.6 million, respectively. | |||||||||||||||||
Amortization of Deferred Financing Costs | ' | ||||||||||||||||
Amortization of Deferred Financing Costs | |||||||||||||||||
Costs incurred in connection with obtaining financing are deferred and amortized on a straight-line basis over the term of the related loan, which is not materially different than the effective interest method. As of June 30, 2014 and December 31, 2013, accumulated amortization of deferred financing costs totaled approximately $6.5 million and $5.9 million, respectively. | |||||||||||||||||
Foreign Currency Translation | ' | ||||||||||||||||
Foreign Currency Translation | |||||||||||||||||
For non-U.S. functional currency operations, assets and liabilities are translated to U.S. dollars at current exchange rates. Revenues and expenses are translated at the average rates for the period. All related adjustments are recorded in other comprehensive income (loss) as a separate component of equity. Transactions denominated in a currency other than the functional currency of the related operation are recorded at rates of exchange in effect at the date of the transaction. Gains or losses on foreign currency transactions are recorded in other income (expense). For the three and six months ended June 30, 2014, we recorded a gain of approximately $350,000 and $85,000, respectively, and, for the three and six months ended June 30, 2013, we recorded a loss of approximately $210,000 and $320,000, respectively. | |||||||||||||||||
Accounting for Equity Awards | ' | ||||||||||||||||
Accounting for Equity Awards | |||||||||||||||||
The cost of restricted stock is required to be measured based on the grant-date fair value and the cost to be recognized over the relevant service period. | |||||||||||||||||
Fair Value Measurements | ' | ||||||||||||||||
Fair Value Measurements | |||||||||||||||||
The accounting standard for fair value measurements and disclosures defines fair value, establishes a framework for measuring fair value, and provides for expanded disclosure about fair value measurements. Fair value is defined by the accounting standard for fair value measurements and disclosures 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. It also establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three levels. The following summarizes the three levels of inputs and hierarchy of fair value we use when measuring fair value: | |||||||||||||||||
• | Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access; | ||||||||||||||||
• | Level 2 inputs may include quoted prices for similar assets and liabilities in active markets, as well as interest rates and yield curves that are observable at commonly quoted intervals; and | ||||||||||||||||
• | Level 3 inputs are unobservable inputs for the assets or liabilities that are typically based on an entity’s own assumptions as there is little, if any, related market activity. | ||||||||||||||||
In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the fair value measurement will fall within the lowest level that is significant to the fair value measurement in its entirety. | |||||||||||||||||
The accounting guidance for fair value measurements and disclosures provides a framework for measuring fair value and establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. In determining fair value, we utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible as well as consider counterparty credit risk in our assessment of fair value. Considerable judgment is necessary to interpret Level 2 and 3 inputs in determining fair value of our financial and non-financial assets and liabilities. Accordingly, there can be no assurance that the fair values we present herein are indicative of amounts that may ultimately be realized upon sale or other disposition of these assets. | |||||||||||||||||
Financial and non-financial assets and liabilities measured at fair value on a non-recurring basis in our consolidated financial statements consist of real estate and related assets and investments in unconsolidated joint ventures and related liabilities assumed and equity consideration related to our acquisitions. The fair values of these assets, liabilities and equity consideration were determined as of the acquisition dates using widely accepted valuation techniques, including (i) discounted cash flow analysis, which considers, among other things, leasing assumptions, growth rates, discount rates and terminal capitalization rates, (ii) income capitalization approach, which considers prevailing market capitalization rates, and (iii) comparable sales activity. In general, we consider multiple valuation techniques when measuring fair values. However, in certain circumstances, a single valuation technique may be appropriate. All of the fair values of the assets, liabilities and equity consideration as of the acquisition dates were derived using Level 3 inputs. | |||||||||||||||||
The carrying amounts of cash and cash equivalents, customer accounts receivable, other assets, accounts payable and accrued liabilities, distributions payable and amounts due to affiliates approximate fair value because of the relatively short-term nature of these instruments. | |||||||||||||||||
The table below summarizes our fixed rate notes payable at June 30, 2014. The estimated fair value of financial instruments is subjective in nature and is dependent on a number of important assumptions, including discount rates and relevant comparable market information associated with each financial instrument. The fair value of the fixed rate notes payable was estimated by discounting the future cash flows using the current rates at which similar loans would be made to borrowers with similar credit ratings and for the same remaining maturities. The use of different market assumptions and estimation methodologies may have a material effect on the reported estimated fair value amounts. Accordingly, the estimates presented below are not necessarily indicative of the amounts we would realize in a current market exchange. | |||||||||||||||||
June 30, 2014 | December 31, 2013 | ||||||||||||||||
Fair Value | Carrying Value | Fair Value | Carrying Value | ||||||||||||||
Fixed Rate Secured Debt | $ | 000,000,000 | $ | 289,778,742 | $ | 311,362,132 | $ | 300,894,201 | |||||||||
As of June 30, 2014, we had an interest rate swap on one of our loans (See Notes 5 and 6). The valuation of this instrument was determined using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of the derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. The fair values of interest rate swaps are determined using the market standard methodology of netting the discounted future fixed cash payments and the discounted expected variable cash receipts. The variable cash receipts are based on an expectation of future interest rates (forward curves) derived from observable market interest rate curves. | |||||||||||||||||
To comply with GAAP, we incorporate credit valuation adjustments to appropriately reflect both our own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements. In adjusting the fair value of our derivative contracts for the effect of nonperformance risk, we have considered the impact of netting and any applicable credit enhancements, such as collateral postings, thresholds, mutual puts, and guarantees. | |||||||||||||||||
Although we have determined that the majority of the inputs used to value our derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with our derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by us and our counterparties. However, as of June 30, 2014, we have assessed the significance of the impact of the credit valuation adjustments on the overall valuation of our derivative positions and have determined that the credit valuation adjustments are not significant to the overall valuation of our derivatives. As a result, we have determined that our derivative valuations in their entirety are classified in Level 2 of the fair value hierarchy. As of June 30, 2014, we had approximately $167,000 of Level 2 derivatives (interest rate swap) classified in accounts payable and accrued liabilities on our consolidated balance sheet. | |||||||||||||||||
Derivative Instruments and Hedging Activities | ' | ||||||||||||||||
Derivative Instruments and Hedging Activities | |||||||||||||||||
The accounting for changes in the fair value of derivatives depends on the intended use of the derivative and the resulting designation. Derivatives used to hedge exposure to changes in the fair value of an asset, liability or firm commitment attributable to a particular risk are considered fair value hedges. Derivatives used to hedge the exposure to variability in expected future cash flows or other types of forecasted transactions are considered cash flow hedges. | |||||||||||||||||
For derivatives designated as fair value hedges, changes in the fair value of the derivative and the hedged item related to the hedged risk are recognized in the consolidated statements of operations. For derivatives designated as cash flow hedges, the effective portion of changes in the fair value of the derivative is initially reported in other comprehensive income, outside of earnings and subsequently reclassified to earnings when the hedged transaction affects earnings. | |||||||||||||||||
Noncontrolling Interest in Consolidated Entities | ' | ||||||||||||||||
Noncontrolling Interest in Consolidated Entities | |||||||||||||||||
We account for the noncontrolling interest in our Operating Partnership in accordance with amended accounting guidance. Due to our control through our general partnership interest in our Operating Partnership and the limited rights of the limited partner, our Operating Partnership, including its wholly-owned subsidiaries, is consolidated with the Company and the limited partner interest is reflected as a noncontrolling interest in the accompanying consolidated balance sheets. In addition, we account for the noncontrolling interest in the SF property in accordance with the amended accounting guidance. The noncontrolling interests shall continue to be attributed their share of income and losses, even if that attribution results in a deficit noncontrolling interest balance. | |||||||||||||||||
Income Taxes | ' | ||||||||||||||||
Income Taxes | |||||||||||||||||
We made an election to be taxed as a Real Estate Investment Trust (“REIT”), under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”), commencing with our taxable year ended December 31, 2008. To qualify as a REIT, we must meet certain organizational and operational requirements, including a requirement to distribute at least 90% of the REIT’s ordinary taxable income to stockholders. As a REIT, we generally will not be subject to Federal income tax on taxable income that we distribute to our stockholders. If we fail to qualify as a REIT in any taxable year, we will then be subject to Federal income taxes on our taxable income at regular corporate rates and will not be permitted to qualify for treatment as a REIT for Federal income tax purposes for four years following the year during which qualification is lost unless the IRS grants us relief under certain statutory provisions. Such an event could materially adversely affect our net income and net cash available for distribution to stockholders. However, we believe that we will be organized and operate in such a manner as to qualify for treatment as a REIT and intend to operate in the foreseeable future in such a manner that we will remain qualified as a REIT for Federal income tax purposes. We have concluded that there are no significant uncertain tax positions requiring recognition or disclosure in our consolidated financial statements. | |||||||||||||||||
Even if we qualify for taxation as a REIT, we may be subject to certain state and local taxes on our income and property, and Federal income and excise taxes on our undistributed income. | |||||||||||||||||
We have filed an election to treat the TRSs as taxable REIT subsidiaries. In general, the TRSs may perform additional services for our customers and generally may engage in any real estate or non-real estate related business. The TRSs are subject to corporate Federal and state income tax. The TRSs follow accounting guidance which requires the use of the asset and liability method. Deferred income taxes will represent the tax effect of future differences between the book and tax bases of assets and liabilities. | |||||||||||||||||
Per Share Data | ' | ||||||||||||||||
Per Share Data | |||||||||||||||||
Basic earnings per share attributable to the Company for all periods presented are computed by dividing net income (loss) by the weighted average number of shares outstanding during the period. Diluted earnings per share are computed by dividing net income (loss) by the weighted average number of shares outstanding, including all restricted stock grants as though fully vested. For the three and six months ended June 30, 2014, 3,750 shares, of unvested restricted stock were included in the diluted weighted average shares. For the three and six months ended June 30, 2013, 3,750 shares of unvested restricted stock were not included in the diluted weighted average shares as such shares were antidilutive. | |||||||||||||||||
Recently Issued Accounting Guidance | ' | ||||||||||||||||
Recently Issued Accounting Guidance | |||||||||||||||||
In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU 2014-09 “Revenue from Contracts with Customers” (“ASU 2014-09”) as Accounting Standards Codification (“ASC”) Topic 606. The objective of ASU 2014-09 is to establish a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and will supersede most of the existing revenue recognition guidance, including industry-specific guidance. The core principle is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In applying the new standard, companies will perform a five-step analysis of transactions to determine when and how revenue is recognized. ASU 2014-09 applies to all contracts with customers except those that are within the scope of other topics is the FASB ASC. This ASU is effective for annual reporting periods (including interim periods within those periods) beginning after December 15, 2016 and shall be applied using either a full retrospective or modified retrospective approach. Early adoption is not permitted. We are in the process of evaluating the impact of this standard on our consolidated financial statements and the impact is unknown at this time. |
Summary_of_Significant_Account2
Summary of Significant Accounting Policies (Tables) | 6 Months Ended | ||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||||||
Estimated Useful Lives used to Depreciate Real Property Assets | ' | ||||||||||||||||
Depreciation of our real property assets is charged to expense on a straight-line basis over the estimated useful lives as follows: | |||||||||||||||||
Description | Standard Depreciable Life | ||||||||||||||||
Land | Not Depreciated | ||||||||||||||||
Buildings | 30 to 35 years | ||||||||||||||||
Site Improvements | 7 to 15 years | ||||||||||||||||
Fixed Rate Notes Payable | ' | ||||||||||||||||
Accordingly, the estimates presented below are not necessarily indicative of the amounts we would realize in a current market exchange. | |||||||||||||||||
June 30, 2014 | December 31, 2013 | ||||||||||||||||
Fair Value | Carrying Value | Fair Value | Carrying Value | ||||||||||||||
Fixed Rate Secured Debt | $ | 000,000,000 | $ | 289,778,742 | $ | 311,362,132 | $ | 300,894,201 |
Real_Estate_Facilities_Tables
Real Estate Facilities (Tables) | 6 Months Ended | ||||||||||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||||||||||
Real Estate [Abstract] | ' | ||||||||||||||||||||||||
Summary of Activity in Real Estate Facilities | ' | ||||||||||||||||||||||||
The following summarizes our activity in real estate facilities during the six months ended June 30, 2014: | |||||||||||||||||||||||||
Real estate facilities | |||||||||||||||||||||||||
Balance at December 31, 2013 | $ | 694,138,787 | |||||||||||||||||||||||
Facility acquisitions | 13,744,304 | ||||||||||||||||||||||||
Impact of foreign exchange rate changes | 280,453 | ||||||||||||||||||||||||
Improvements and additions | 1,038,970 | ||||||||||||||||||||||||
Balance at June 30, 2014 | $ | 709,202,514 | |||||||||||||||||||||||
Accumulated depreciation | |||||||||||||||||||||||||
Balance at December 31, 2013 | $ | (46,432,155 | ) | ||||||||||||||||||||||
Depreciation | (9,539,758 | ) | |||||||||||||||||||||||
Balance at June 30, 2014 | $ | (55,971,913 | ) | ||||||||||||||||||||||
Purchase Price Allocation for Acquisitions | ' | ||||||||||||||||||||||||
The following table summarizes the preliminary purchase price allocation for our acquisitions during the six months ended June 30, 2014: | |||||||||||||||||||||||||
Property | Acquisition | Real Estate | Intangibles | Total(1) | 2014 | 2014 | |||||||||||||||||||
Date | Assets | Revenue(2) | Property | ||||||||||||||||||||||
Operating | |||||||||||||||||||||||||
Income(2)(3) | |||||||||||||||||||||||||
Hampton II – VA | 3/5/14 | $ | 5,930,000 | $ | 770,000 | $ | 6,700,000 | $ | 228,764 | $ | 150,075 | ||||||||||||||
Chandler – AZ | 3/27/14 | 4,375,000 | 510,000 | 4,885,000 | 128,665 | 78,432 | |||||||||||||||||||
Toronto II – ONT(4)(5) | 4/2/14 | 3,439,304 | — | 3,439,304 | — | — | |||||||||||||||||||
Total | $ | 13,744,304 | $ | 1,280,000 | $ | 15,024,304 | $ | 357,429 | $ | 228,507 | |||||||||||||||
(1) | The allocations noted above are based on a preliminary determination of the fair value of the total consideration provided. Such valuations may change as we complete our purchase price accounting. | ||||||||||||||||||||||||
(2) | The operating results of the facilities acquired above have been included in the Company’s statement of operations since their respective acquisition date. | ||||||||||||||||||||||||
(3) | Property operating income excludes corporate general and administrative expenses, asset management fees, interest expense, depreciation, amortization and acquisition expenses. | ||||||||||||||||||||||||
(4) | Allocation (excludes estimated development costs) based on Canadian/U.S. exchange rate as of the date of acquisition. | ||||||||||||||||||||||||
(5) | Property is under construction; therefore the property generated no revenue or operating income as of June 30, 2014. |
Secured_Debt_Tables
Secured Debt (Tables) | 6 Months Ended | ||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||
Debt Disclosure [Abstract] | ' | ||||||||||||||||
Summary of Secured Debt | ' | ||||||||||||||||
The Company’s secured debt is summarized as follows: | |||||||||||||||||
Carrying value as of: | |||||||||||||||||
Encumbered Property | June 30, | December 31, | Interest | Maturity | |||||||||||||
2014 | 2013 | Rate | Date | ||||||||||||||
Montgomery | $ | 2,653,581 | $ | 2,693,364 | 6.42 | % | 7/1/16 | ||||||||||
Seabrook | 4,406,016 | 4,444,137 | 5.73 | % | 1/1/16 | ||||||||||||
Greenville | 2,207,907 | 2,226,986 | 5.65 | % | 3/1/16 | ||||||||||||
Kemah | 8,666,284 | 8,732,981 | 6.2 | % | 6/1/16 | ||||||||||||
Memphis | 2,445,084 | 2,465,045 | 5.67 | % | 12/1/16 | ||||||||||||
Tallahassee | 7,397,484 | 7,446,178 | 6.16 | % | 8/1/16 | ||||||||||||
Houston | 1,961,286 | 1,981,095 | 5.67 | % | 2/1/17 | ||||||||||||
San Francisco | 10,186,862 | 10,256,163 | 5.84 | % | 1/1/17 | ||||||||||||
Lake Forest | 18,000,000 | 18,000,000 | 6.47 | % | 10/1/17 | ||||||||||||
Las Vegas II | 1,501,554 | 1,511,958 | 5.72 | % | 6/1/17 | ||||||||||||
Pearland | 3,416,319 | 3,438,473 | 5.93 | % | 7/1/17 | ||||||||||||
Daphne | 1,296,109 | 1,381,213 | 5.47 | % | 8/1/20 | ||||||||||||
Mesa | 2,932,407 | 2,968,060 | 5.38 | % | 4/1/15 | ||||||||||||
Riverdale(1) | — | 4,800,000 | 4 | % | 5/14/14 | ||||||||||||
Prudential Portfolio Loan(2)(3) | 30,782,782 | 31,044,708 | 5.42 | % | 9/5/19 | ||||||||||||
Dufferin – Toronto – Ontario, Canada(4) | 6,059,757 | 6,144,911 | 4.74 | % | 4/15/17 | ||||||||||||
Citi Loan(5) | 27,872,420 | 28,077,873 | 5.77 | % | 2/6/21 | ||||||||||||
Bank of America Loan – 1(6) | 4,280,685 | 4,321,842 | 5.18 | % | 11/1/15 | ||||||||||||
Bank of America Loan – 2(7) | 6,486,384 | 6,548,748 | 5.18 | % | 11/1/15 | ||||||||||||
Bank of America Loan – 3(8) | 11,658,609 | 11,770,704 | 5.18 | % | 11/1/15 | ||||||||||||
Prudential – Long Beach(9) | 6,479,404 | 6,533,640 | 5.27 | % | 9/5/19 | ||||||||||||
SF Bay Area – Vallejo(10) | — | 4,295,098 | 6.04 | % | 6/1/14 | ||||||||||||
Citi Las Vegas Loan(11) | 7,375,207 | 7,434,590 | 5.26 | % | 6/6/21 | ||||||||||||
ING Loan(12) | 21,097,702 | 21,265,500 | 5.47 | % | 7/1/21 | ||||||||||||
Ladera Ranch | 6,622,832 | 6,691,304 | 5.84 | % | 6/1/16 | ||||||||||||
Las Vegas V | 1,608,570 | 1,628,783 | 5.02 | % | 7/1/15 | ||||||||||||
Mississauga(13) – Ontario, Canada | 6,779,685 | 6,763,769 | 5 | % | 10/31/14 | ||||||||||||
Chantilly(14) | 3,394,147 | 3,421,797 | 4.75 | % | 6/6/22 | ||||||||||||
Brampton(15) – Ontario, Canada | 6,498,136 | 6,482,879 | 5.25 | % | 6/30/16 | ||||||||||||
Citi Stockade Loan – 1(16) | 18,200,000 | 18,200,000 | 4.6 | % | 10/1/22 | ||||||||||||
KeyBank CMBS Loan(17) | 30,726,739 | 30,960,278 | 4.65 | % | 11/1/22 | ||||||||||||
Citi Stockade Loan – 2(18) | 19,362,500 | 19,362,500 | 4.61 | % | 11/6/22 | ||||||||||||
Bank of America Loan – 4(19) | 6,357,269 | 6,394,362 | 6.33 | % | 10/1/17 | ||||||||||||
Citi SF Bay Area – Morgan Hill Loan(20) | 3,000,000 | 3,000,000 | 4.08 | % | 3/6/23 | ||||||||||||
KeyBank Revolver(21) | 89,000,000 | 71,000,000 | 1.66 | % | 10/25/16 | ||||||||||||
John Hancock Loan(22) | 16,538,885 | 16,682,984 | 6.36 | % | 6/1/18 | ||||||||||||
Net fair value adjustment | 863,714 | 913,837 | |||||||||||||||
Total secured debt | $ | 398,116,320 | $ | 391,285,760 | |||||||||||||
(1) | On April 28, 2014, this loan was repaid in full and the related property is now encumbered under the KeyBank Revolver. | ||||||||||||||||
(2) | This portfolio loan is comprised of 11 discrete mortgage loans on 11 respective properties (Manassas, Marietta, Erlanger, Pittsburgh, Weston, Fort Lee, Oakland Park, Tempe, Phoenix II, Davie and Las Vegas I). Each of the individual loans is cross-collateralized by the other ten. | ||||||||||||||||
(3) | Ten of the loans in this portfolio loan bear an interest rate of 5.43%, and the remaining loan bears an interest rate of 5.31%. The weighted average interest rate of this portfolio is 5.42%. | ||||||||||||||||
(4) | On January 12, 2011, we encumbered the Dufferin property with a Canadian dollar denominated loan which bears interest at the bank’s floating rate plus 3.0% (subject to a reduction in certain circumstances). The rate in effect at June 30, 2014 was 4.74%. The maturity date of this loan was extended in May 2014 to April 15, 2017. | ||||||||||||||||
(5) | This portfolio loan encumbers 11 properties (Biloxi, Gulf Breeze I, Alpharetta, Florence II, Jersey City, West Mifflin, Chicago – 95th St., Chicago – Western Ave., Chicago – Ogden Ave., Chicago – Roosevelt Rd. and Las Vegas IV). The net book value of the encumbered properties as of June 30, 2014 was approximately $49.6 million. Such amounts are only available to satisfy the obligations of this loan. | ||||||||||||||||
(6) | This loan encumbers the Lawrenceville I and II properties. | ||||||||||||||||
(7) | This loan encumbers the Concord, Hickory and Morganton properties. | ||||||||||||||||
(8) | This loan encumbers the El Paso II, III, IV & V properties as well as the Dallas property. | ||||||||||||||||
(9) | This loan is cross-collateralized by the 11 properties discussed in footnote (2) to this table. | ||||||||||||||||
(10) | On May 1, 2014, this loan was repaid in full and the related property is now encumbered under the KeyBank Revolver. | ||||||||||||||||
(11) | This loan encumbers the Las Vegas VII and Las Vegas VIII properties. The net book value of the encumbered properties as of June 30, 2014 was approximately $8.9 million. Such amounts are only available to satisfy the obligations of this loan. | ||||||||||||||||
(12) | This portfolio loan is comprised of 11 discrete mortgage loans on 11 respective properties (Peachtree City, Buford, Jonesboro, Ellenwood, Marietta II, Collegeville, Skippack, Ballston Spa, Trenton, Fredericksburg and Sandston). Each of the individual loans had an original term of 30 years and matures on July 1, 2041. ING has the option to require payment of the loan in full every five years beginning on July 1, 2021. | ||||||||||||||||
(13) | In December 2011, we entered into a Canadian dollar denominated construction loan with an aggregate commitment amount of approximately $9.2 million. Such loan bears interest at the bank’s floating rate, plus 2% (totaling 5.0% as of June 30, 2014). | ||||||||||||||||
(14) | The net book value of the Chantilly property as of June 30, 2014 was approximately $6.7 million. Such amounts are only available to satisfy the obligations of this loan. | ||||||||||||||||
(15) | In September 2012, we entered into a Canadian dollar denominated construction loan with an aggregate potential commitment amount of approximately $9.2 million. Such loan bears interest at the bank’s floating rate, plus 2.25% (totaling 5.25% as of June 30, 2014). | ||||||||||||||||
(16) | This portfolio loan encumbers 10 properties (Savannah I, Savannah II, Columbia, Lexington I, Stuart I, Lexington II, Stuart II, Bluffton, Wilmington Island and Myrtle Beach). The net book value of the encumbered properties as of June 30, 2014 was approximately $33.9 million. Such amounts are only available to satisfy the obligations of this loan. | ||||||||||||||||
(17) | This portfolio loan encumbers nine properties (Los Angeles – La Cienega, Las Vegas III, Las Vegas VI, Hampton, SF Bay Area – Gilroy, Toms River, Crescent Springs, Florence and Walton). The net book value of the encumbered properties as of June 30, 2014 was approximately $40.8 million. Such amounts are only available to satisfy the obligations of this loan. | ||||||||||||||||
(18) | This portfolio loan encumbers six properties (Mt. Pleasant I, Charleston I, Charleston II, Mt. Pleasant II, Charleston III, and Mt. Pleasant III). The net book value of the encumbered properties as of June 30, 2014 was approximately $36.1 million. Such amounts are only available to satisfy the obligations of this loan. | ||||||||||||||||
(19) | This loan encumbers the Ridgeland and Canton properties. | ||||||||||||||||
(20) | This loan encumbers the Morgan Hill property. The net book value of the encumbered property as of June 30, 2014 was approximately $5.2 million. Such amount is only available to satisfy the obligations of this loan. | ||||||||||||||||
(21) | On October 28, 2013, through our Operating Partnership and certain property-owning special purpose entities wholly-owned by our Operating Partnership, we entered into the KeyBank Revolver, which matures on October 25, 2016. Such loan encumbers the Homeland Portfolio properties, the Knoxville Portfolio properties and nine other properties (Gulf Breeze II, El Paso I, Toms River II, North Charleston, Phoenix I, Riverdale, SF Bay Area – Vallejo, Hampton II, and Chandler). This loan is a LIBOR based variable rate loan, and such rate is based on 30-day LIBOR, which including the applicable spread equaled an interest rate of 1.66% as of June 30, 2014. The interest rate swap with a notional amount of $45 million that was originally entered into in connection with the Second Restated KeyBank Loan remains outstanding. For additional discussion, see “KeyBank Revolver” below. | ||||||||||||||||
(22) | This loan encumbers the Midland I, Coppell, Midland II, Arlington and Weatherford properties. | ||||||||||||||||
Future Principal Payment Requirements on Outstanding Secured Debt | ' | ||||||||||||||||
The following table presents the future principal payment requirements on outstanding secured debt as of June 30, 2014: | |||||||||||||||||
2014 | $ | 8,988,872 | |||||||||||||||
2015 | 31,081,492 | ||||||||||||||||
2016 | 132,883,456 | ||||||||||||||||
2017 | 49,718,520 | ||||||||||||||||
2018 | 18,827,369 | ||||||||||||||||
2019 and thereafter | 155,752,897 | ||||||||||||||||
Total payments | 397,252,606 | ||||||||||||||||
Unamortized fair value adjustment | 863,714 | ||||||||||||||||
Total | $ | 398,116,320 | |||||||||||||||
Derivative_Instruments_Cash_Fl1
Derivative Instruments - Cash Flow Hedge of Interest Rate Risk (Tables) | 6 Months Ended | ||||||||||||
Jun. 30, 2014 | |||||||||||||
Derivative Instruments And Hedging Activities Disclosure [Abstract] | ' | ||||||||||||
Interest Rate Derivative Designated as Cash Flow Hedge of Interest Rate Risk | ' | ||||||||||||
As of June 30, 2014, we had one derivative outstanding, which was an interest rate derivative that was designated as a cash flow hedge of interest rate risk: | |||||||||||||
Interest Rate Derivative | Number of | Notional | |||||||||||
Instruments | |||||||||||||
Interest Rate Swap | 1 | $ | 45,000,000 | ||||||||||
Fair Value of Derivative Financial Instruments as well as Classification on Balance Sheet | ' | ||||||||||||
The table below presents the fair value of our derivative financial instruments as well as their classification on the consolidated balance sheet as of June 30, 2014 and December 31, 2013: | |||||||||||||
As of June 30, 2014 | As of December 31, 2013 | ||||||||||||
Balance Sheet | Fair Value | Balance Sheet | Fair Value | ||||||||||
Location | Location | ||||||||||||
Interest rate derivatives | |||||||||||||
Assets | Other assets | $ | — | Other assets | $ | — | |||||||
Liabilities | Accounts payable and | $ | 167,203 | Accounts payable and | $ | 303,051 | |||||||
accrued liabilities | accrued liabilities | ||||||||||||
Related_Party_Transactions_Tab
Related Party Transactions (Tables) | 6 Months Ended | ||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||
Related Party Transactions [Abstract] | ' | ||||||||||||||||
Summary of Related Party Costs Incurred | ' | ||||||||||||||||
Pursuant to the terms of the agreements described above, the following summarizes the related party costs incurred for the three and six months ended June 30, 2014 and 2013: | |||||||||||||||||
Three Months | Three Months | Six Months | Six Months | ||||||||||||||
Ended | Ended | Ended | Ended | ||||||||||||||
June 30, | June 30, | June 30, | June 30, | ||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Expensed | |||||||||||||||||
Reimbursement of operating expenses(1) | $ | 253,558 | $ | 13,956 | $ | 620,904 | $ | 22,101 | |||||||||
Asset management fees(2) | 1,529,666 | 1,181,308 | 3,041,934 | 2,356,940 | |||||||||||||
Property management fees(3)(4) | 1,428,674 | 1,176,105 | 2,803,616 | 2,288,202 | |||||||||||||
Acquisition expenses | 103,703 | 53,010 | 612,245 | 106,619 | |||||||||||||
Additional Paid-in Capital | |||||||||||||||||
Selling commissions | — | 2,084,569 | — | 2,929,034 | |||||||||||||
Dealer Manager fee | — | 893,386 | — | 1,255,300 | |||||||||||||
Reimbursement of offering costs | — | 111,432 | — | 224,129 | |||||||||||||
Total | $ | 3,315,601 | $ | 5,513,766 | $ | 7,078,699 | $ | 9,182,325 | |||||||||
(1) | During the three and six months ended June 30, 2013, our Advisor permanently waived certain reimbursable indirect costs, primarily payroll and related overhead costs, related to administrative and management services, totaling approximately $330,000 and $625,000, respectively. Such amounts were waived permanently and accordingly, will not be paid to our Advisor. Such reimbursable indirect costs were not waived by the Advisor during the three and six months ended June 30, 2014, and totaled approximately $249,000 and $611,000, respectively. | ||||||||||||||||
(2) | During the three and six months ended June 30, 2013, our Advisor permanently waived asset management fees related to the Stockade Portfolio totaling approximately $173,000 and $349,000, respectively. Such amounts were waived permanently and accordingly, will not be paid to our Advisor. Such asset management fees were not waived by the Advisor during the three and six months ended June 30, 2014, and totaled approximately $176,000 and $353,000, respectively. | ||||||||||||||||
(3) | During the three and six months ended June 30, 2013, property management fees included approximately none and $27,000, respectively, of fees paid to the former sub-property manager of our Canadian properties. Such sub-property management agreement was terminated effective March 31, 2013 at a cost of approximately $28,000. | ||||||||||||||||
(4) | During the three and six months ended June 30, 2014 and 2013, our Property Manager permanently waived certain costs, reimbursements and fees, including construction management fees, tenant insurance administration fees and expense reimbursements related to certain off-site property management employees. Such amounts totaled approximately $174,000 and $130,000, respectively for the three months ended June 30, 2014 and 2013, and approximately $356,000 and $280,000, respectively for the six months ended June 30, 2014 and 2013. These amounts were waived permanently and accordingly, will not be paid to our Property Manager. |
Selected_Quarterly_Data_Tables
Selected Quarterly Data (Tables) | 6 Months Ended | ||||||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ' | ||||||||||||||||||||
Summary of Quarterly Financial Information | ' | ||||||||||||||||||||
The following is a summary of quarterly financial information for the periods shown below: | |||||||||||||||||||||
Three months ended | |||||||||||||||||||||
June 30, | September 30, | December 31, | March 31, | June 30, | |||||||||||||||||
2013 | 2013 | 2013 | 2014 | 2014 | |||||||||||||||||
Total revenues | $ | 19,931,208 | $ | 21,292,574 | $ | 22,503,218 | $ | 23,132,944 | $ | 24,321,406 | |||||||||||
Total operating expenses | $ | 16,667,044 | $ | 17,229,995 | $ | 19,315,207 | $ | 19,105,230 | $ | 18,566,277 | |||||||||||
Operating income | $ | 3,264,164 | $ | 4,062,579 | $ | 3,188,011 | $ | 4,027,714 | $ | 5,755,129 | |||||||||||
Net income (loss) | $ | (1,949,099 | ) | $ | (689,288 | ) | $ | (2,639,352 | ) | $ | (1,039,656 | ) | $ | 1,449,237 | |||||||
Net income (loss) attributable to the Company | $ | (1,949,079 | ) | $ | (693,245 | ) | $ | (2,637,508 | ) | $ | (1,033,683 | ) | $ | 1,433,221 | |||||||
Net income (loss) per share-basic and diluted | $ | (0.04 | ) | $ | (0.01 | ) | $ | (0.05 | ) | $ | (0.02 | ) | $ | 0.03 |
Organization_Additional_Inform
Organization - Additional Information (Detail) (USD $) | 0 Months Ended | 1 Months Ended | 6 Months Ended | 0 Months Ended | 0 Months Ended | 0 Months Ended | 6 Months Ended | |||||||||||
Apr. 01, 2014 | Mar. 31, 2011 | Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2013 | Sep. 22, 2011 | Sep. 23, 2013 | Sep. 16, 2011 | Sep. 22, 2011 | Aug. 24, 2007 | Jun. 30, 2014 | Sep. 23, 2013 | Sep. 22, 2011 | Sep. 28, 2013 | Sep. 23, 2013 | Aug. 24, 2007 | Jun. 30, 2014 | Jun. 30, 2014 | |
sqft | IPO | IPO | Public Offering | Strategic Storage Operating Partnership, L.P. | Strategic Storage Operating Partnership, L.P. | Distribution Reinvestment Plan | Distribution Reinvestment Plan | Distribution Reinvestment Plan | Distribution Reinvestment Plan | Strategic Storage Advisor, LLC, | Strategic Storage Advisor, LLC, | Strategic Storage Advisor, LLC, | ||||||
State | Maximum | Maximum | Strategic Storage Operating Partnership, L.P. | |||||||||||||||
Store | ||||||||||||||||||
Organization and Nature of Operations [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Date of formation of company | ' | ' | 14-Aug-07 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Sale of common shares | ' | ' | $558,000,000 | ' | ' | ' | $256,000,000 | $289,000,000 | ' | ' | ' | ' | ' | ' | ' | $1,000 | ' | ' |
Number of shares sold | ' | ' | 55,000,000 | ' | ' | ' | 25,000,000 | 29,000,000 | 100,000,000 | ' | ' | ' | ' | ' | ' | 100 | ' | ' |
Common stock, shares authorized | ' | ' | 700,000,000 | ' | 700,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock, par value | ' | ' | $0.00 | ' | $0.00 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of preferred stock, shares | ' | ' | 200,000,000 | ' | 200,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred stock, par value | ' | ' | $0.00 | ' | $0.00 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Advisor purchased a limited partnership interest in Operating Partnership | ' | ' | ' | ' | ' | ' | ' | ' | ' | 200,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Initial capital contribution | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of limited partnership interests | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 98.87% | ' | ' | ' | ' | ' | ' | ' |
Percentage of limited partnership interests owned by noncontrolling owners | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.10% | ' | ' | ' | ' | ' | ' | 0.03% |
Shares offered in follow-on public offering | ' | ' | ' | ' | ' | 110,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Shares potentially issuable in follow-on offering, pursuant to dividend reinvestment plan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,000,000 | ' | ' | ' | ' | ' |
Date of launch of the Initial Offering | ' | ' | 17-Mar-08 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Date of satisfying minimum offering requirements and commencing formal operations | ' | ' | 22-May-08 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Initial offering termination date | ' | ' | 16-Sep-11 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Date of commencing follow-on public offering | ' | ' | 22-Sep-11 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Follow-on offering termination date | ' | ' | 22-Sep-13 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Additional shares registered | ' | ' | $9,131,346 | $7,264,595 | ' | ' | ' | ' | ' | ' | ' | ' | ' | $51,250,000 | $51,250,000 | ' | ' | ' |
Offering termination period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '10 days | ' | ' | ' | ' | ' | ' |
Percentage owned by chief executive officer in Dealer Manager | ' | ' | 15.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 15.00% | ' |
Number of Class D Units issued by Operating Partnership in connection with acquisition of the Las Vegas VII and Las Vegas VIII properties | ' | 120,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Conversion of partnership units, description | ' | ' | 'Finally, a limited partner in our Operating Partnership may later exchange his or her limited partnership units in our Operating Partnership for shares of our common stock at any time after one year following the date of issuance of their limited partnership units, subject to certain restrictions as outlined in the limited partnership agreement. | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Annualized distribution rate for Class D units | $0.70 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of wholly-owned self storage facilities | ' | ' | 125 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of owned self storage facilities | ' | ' | 126 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of partially owned self storage facilities | ' | ' | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ownership percentage of partially owned self storage facility | ' | ' | 99.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of states in which wholly-owned self storage facilities are located | ' | ' | 17 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of operation units | ' | ' | 80,325 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net rentable square feet of the facilities | ' | ' | 10,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Noncontrolling interests in additional self storage facilities | ' | ' | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Area of lease to single tenant | ' | ' | 356,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Summary_of_Significant_Account3
Summary of Significant Accounting Policies - Additional Information (Detail) (USD $) | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | 6 Months Ended | 2 Months Ended | 6 Months Ended | ||||||||||
Jan. 31, 2010 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2013 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Feb. 28, 2014 | 31-May-14 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Dec. 31, 2013 | |
sqft | sqft | Fair Value, Inputs, Level 2 | Delaware statutory trust (DST) | Westport Lax LLC | Variable Interest Entities Acquired in 2009 Mergers | Hawthorne Property | USA SF Self Storage, DST | USA SF Self Storage, DST | Personal Property | Personal Property | In-place lease intangibles | In-place lease intangibles | |||||
Investment | sqft | Entity | Vendor | Vendor | Minimum | Maximum | |||||||||||
Summary Of Significant Accounting Policies [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Additional interest acquired in VIE as primary beneficiary | 2.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net interest in property | 12.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 12.00% | ' | ' | ' | ' | ' |
Number of third-party sellers | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 45 | 1 | ' | ' | ' | ' |
Percentage of voting interests acquired | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 86.00% | 1.00% | ' | ' | ' | ' |
Beneficial interest owned after transactions | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 98.00% | 99.00% | ' | ' | ' | ' |
Purchase price allocation to intangible assets | ' | $1,280,000 | ' | $1,280,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount paid as acquisition fees | ' | 700,000 | 200,000 | 1,400,000 | 300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Impairment losses of long-lived assets | ' | ' | ' | 0 | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of interests in unconsolidated joint ventures deemed to be VIEs | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' | ' | ' | ' | ' | ' |
Passive or limited partner interests in storage facilities | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Aggregate investment | ' | 100,000 | ' | 100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of ownership interest | ' | ' | ' | 1.49% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Area of lease to single tenant | ' | 356,000 | ' | 356,000 | ' | ' | ' | ' | 356,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Ownership interest in equity method investment | ' | ' | ' | ' | ' | ' | ' | ' | 12.00% | ' | ' | 98.00% | ' | ' | ' | ' | ' |
Carrying value of equity method investment | ' | ' | ' | ' | ' | ' | ' | ' | 1,300,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Ownership percentage of affiliates | ' | ' | ' | ' | ' | ' | ' | ' | 78.00% | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred equity distribution percentage | ' | ' | ' | ' | ' | ' | ' | ' | 10.00% | ' | ' | ' | ' | ' | ' | ' | ' |
Amount of investment | ' | ' | ' | ' | ' | ' | ' | ' | 6,900,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Non-interest bearing receivable | ' | ' | ' | ' | ' | ' | ' | ' | 400,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Remaining interest owned by third party | ' | ' | ' | ' | ' | ' | ' | ' | 10.00% | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum exposure to loss | ' | 27,300,000 | ' | 27,300,000 | ' | ' | ' | ' | ' | ' | 18,700,000 | ' | ' | ' | ' | ' | ' |
Maturity date of guaranteed loan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1-Aug-20 | ' | ' | ' | ' | ' | ' |
Estimated useful life | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '3 years | '5 years | ' | ' |
Accumulated amortization of lease intangibles | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 47,700,000 | 44,600,000 |
Accumulated amortization of deferred financing costs | ' | 6,500,000 | ' | 6,500,000 | ' | 5,900,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net gain (loss) recorded on foreign currency transactions | ' | 350,000 | -210,000 | 85,000 | -320,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Derivative liabilities classified in accounts payable and accrued liabilities, at fair value | ' | ' | ' | ' | ' | ' | $167,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Minimum percentage of ordinary taxable income to be distributed to stockholders | ' | ' | ' | 90.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Antidilutive unvested restricted stock not included in diluted weighted average shares | ' | 3,750 | 3,750 | 3,750 | 3,750 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated_Useful_Lives_used_to
Estimated Useful Lives used to Depreciate Real Property Assets (Detail) | 6 Months Ended |
Jun. 30, 2014 | |
Land [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Standard Depreciable Life | 'Not Depreciated |
Buildings | Minimum | ' |
Property, Plant and Equipment [Line Items] | ' |
Standard Depreciable Life | '30 years |
Buildings | Maximum | ' |
Property, Plant and Equipment [Line Items] | ' |
Standard Depreciable Life | '35 years |
Site Improvements | Minimum | ' |
Property, Plant and Equipment [Line Items] | ' |
Standard Depreciable Life | '7 years |
Site Improvements | Maximum | ' |
Property, Plant and Equipment [Line Items] | ' |
Standard Depreciable Life | '15 years |
Fixed_Rate_Notes_Payable_Detai
Fixed Rate Notes Payable (Detail) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Accounting Policies [Abstract] | ' | ' |
Fixed Rate Secured Debt, Fair Value | $303,887,408 | $311,362,132 |
Fixed Rate Secured Debt, Carrying Value | $289,778,742 | $300,894,201 |
Southwest_Colonial_DST_and_USA1
Southwest Colonial, DST and USA SF Self Storage, DST Acquisitions - Additional Information (Detail) (USD $) | 1 Months Ended | 3 Months Ended | 6 Months Ended | 3 Months Ended | 6 Months Ended | 2 Months Ended | ||||
Jan. 31, 2010 | Jun. 30, 2014 | Jun. 30, 2014 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Jun. 30, 2014 | Feb. 28, 2014 | Jun. 30, 2014 | 31-May-14 | |
Store | Store | Southwest Colonial, DST | Southwest Colonial, DST | Southwest Colonial, DST | USA SF Self Storage, DST | USA SF Self Storage, DST | USA SF Self Storage, DST | |||
Vendor | Property | Store | Vendor | |||||||
Store | sqft | |||||||||
sqft | Vendor | |||||||||
Vendor | ||||||||||
Business Acquisition [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Beneficial interest acquired | ' | ' | ' | ' | ' | 100.00% | ' | 86.00% | ' | 1.00% |
Business acquisition purchase price | ' | ' | ' | ' | ' | $27,900,000 | ' | $20,000,000 | ' | ' |
Business acquisition cash paid | ' | ' | ' | ' | ' | 9,000,000 | ' | 5,700,000 | ' | ' |
Number of limited partnership units issued | ' | ' | ' | ' | ' | 151,300 | ' | 245,000 | ' | ' |
Loan assumed as purchase consideration | ' | ' | ' | ' | ' | 16,700,000 | ' | 10,200,000 | ' | ' |
Number of third-party sellers | ' | ' | ' | ' | ' | 50 | ' | 45 | ' | 1 |
Economic benefit and obligations percentage | ' | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' |
Acquisition fees paid to the Advisor | ' | 100,000 | 600,000 | ' | 340,000 | ' | ' | 200,000 | ' | ' |
Number of operation units | ' | 80,325 | 80,325 | ' | ' | ' | 2,805 | 1,120 | ' | ' |
Number of wholly-owned self storage facilities | ' | 125 | 125 | ' | ' | ' | 5 | ' | ' | ' |
Total rental area | ' | ' | ' | ' | ' | ' | 392,000 | 76,000 | ' | ' |
Fixed interest rate on loan | ' | ' | ' | ' | ' | ' | 6.36% | ' | ' | ' |
Term of loan | ' | ' | ' | ' | ' | ' | '10 years | ' | ' | ' |
Maturity date of term loan | ' | ' | ' | ' | ' | ' | 30-Jun-18 | ' | ' | ' |
Number of properties secured on loan | ' | ' | ' | ' | ' | ' | 5 | ' | ' | ' |
Business acquisition ownership percentage | ' | ' | ' | ' | ' | ' | ' | 98.00% | ' | ' |
Net interest in property | 12.00% | ' | ' | ' | ' | ' | ' | 12.00% | ' | ' |
Beneficial interest owned after transactions | ' | ' | ' | ' | ' | ' | ' | 98.00% | ' | 99.00% |
Lease expiry date | ' | ' | ' | ' | ' | ' | ' | 19-Dec-16 | ' | ' |
Lease expiry period | ' | ' | ' | ' | ' | ' | ' | '10 years | ' | ' |
Real estate facilities, net | ' | 658,297,626 | 658,297,626 | 648,483,436 | ' | ' | ' | ' | 16,500,000 | ' |
Secured debt | ' | 398,116,320 | 398,116,320 | 391,285,760 | ' | ' | ' | ' | 10,000,000 | ' |
Noncontrolling interest | ' | $4,266,243 | $4,266,243 | $7,972,157 | ' | ' | ' | ' | $100,000 | ' |
Summary_of_Activity_in_Real_Es
Summary of Activity in Real Estate Facilities (Detail) (USD $) | 6 Months Ended | |
Jun. 30, 2014 | Jun. 30, 2013 | |
Real estate facilities | ' | ' |
Balance at beginning of year | $694,138,787 | ' |
Facility acquisitions | 13,744,304 | ' |
Impact of foreign exchange rate changes | 280,453 | -1,667,603 |
Improvements and additions | 1,038,970 | ' |
Balance at end of year | 709,202,514 | ' |
Accumulated depreciation | ' | ' |
Balance at beginning of year | -46,432,155 | ' |
Depreciation | -9,539,758 | ' |
Balance at end of year | ($55,971,913) | ' |
Purchase_Price_Allocation_for_
Purchase Price Allocation for Acquisitions (Detail) (USD $) | 6 Months Ended | |
Jun. 30, 2014 | ||
Business Acquisition [Line Items] | ' | |
Real Estate Assets | $13,744,304 | |
Intangibles | 1,280,000 | |
Total | 15,024,304 | [1] |
2014 Revenue | 357,429 | [2] |
2014 Property Operating Income | 228,507 | [2],[3] |
Hampton II - VA | ' | |
Business Acquisition [Line Items] | ' | |
Acquisition Date | 5-Mar-14 | |
Real Estate Assets | 5,930,000 | |
Intangibles | 770,000 | |
Total | 6,700,000 | [1] |
2014 Revenue | 228,764 | [2] |
2014 Property Operating Income | 150,075 | [2],[3] |
Chandler - AZ | ' | |
Business Acquisition [Line Items] | ' | |
Acquisition Date | 27-Mar-14 | |
Real Estate Assets | 4,375,000 | |
Intangibles | 510,000 | |
Total | 4,885,000 | [1] |
2014 Revenue | 128,665 | [2] |
2014 Property Operating Income | 78,432 | [2],[3] |
Toronto II - ONT | ' | |
Business Acquisition [Line Items] | ' | |
Acquisition Date | 2-Apr-14 | [4],[5] |
Real Estate Assets | 3,439,304 | [4],[5] |
Total | $3,439,304 | [1],[4],[5] |
[1] | The allocations noted above are based on a preliminary determination of the fair value of the total consideration provided. Such valuations may change as we complete our purchase price accounting. | |
[2] | The operating results of the facilities acquired above have been included in the Company's statement of operations since their respective acquisition date. | |
[3] | Property operating income excludes corporate general and administrative expenses, asset management fees, interest expense, depreciation, amortization and acquisition expenses. | |
[4] | Allocation (excludes estimated development costs) based on Canadian/U.S. exchange rate as of the date of acquisition. | |
[5] | Property is under construction; therefore the property generated no revenue or operating income as of June 30, 2014. |
Real_Estate_Facilities_Additio
Real Estate Facilities - Additional Information (Detail) (USD $) | 3 Months Ended | 6 Months Ended |
In Millions, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2014 |
Real Estate Properties Base Purchase Price [Abstract] | ' | ' |
Amount paid as acquisition fees | $0.10 | $0.60 |
Summary_of_Secured_Debt_Detail
Summary of Secured Debt (Detail) (USD $) | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2014 | Dec. 31, 2013 | |||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | $397,252,606 | ' | ||
Total secured debt | 398,116,320 | 391,285,760 | ||
Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Net fair value adjustment | 863,714 | 913,837 | ||
Prudential Portfolio Loan | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 5.42% | [1],[2] | ' | |
Maturity date | 5-Sep-19 | [1],[2] | ' | |
Prudential Portfolio Loan | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 30,782,782 | [1],[2] | 31,044,708 | [1],[2] |
Dufferin - Toronto - Ontario, Canada | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 4.74% | [3] | ' | |
Maturity date | 15-Apr-17 | [3] | ' | |
Dufferin - Toronto - Ontario, Canada | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 6,059,757 | [3] | 6,144,911 | [3] |
ING Loan | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 5.47% | [4] | ' | |
Maturity date | 1-Jul-21 | [4] | ' | |
ING Loan | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 21,097,702 | [4] | 21,265,500 | [4] |
Mississauga - Ontario, Canada | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 5.00% | [5] | ' | |
Maturity date | 31-Oct-14 | [5] | ' | |
Mississauga - Ontario, Canada | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 6,779,685 | [5] | 6,763,769 | [5] |
KeyBank Revolver | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 1.66% | [6] | ' | |
Maturity date | 25-Oct-16 | [6] | ' | |
KeyBank Revolver | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 89,000,000 | [6] | 71,000,000 | [6] |
Citi Las Vegas Loan | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 5.26% | [7] | ' | |
Maturity date | 6-Jun-21 | [7] | ' | |
Citi Las Vegas Loan | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 7,375,207 | [7] | 7,434,590 | [7] |
Chantilly - VA | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 4.75% | [8] | ' | |
Maturity date | 6-Jun-22 | [8] | ' | |
Chantilly - VA | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 3,394,147 | [8] | 3,421,797 | [8] |
Montgomery | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 6.42% | ' | ||
Maturity date | 1-Jul-16 | ' | ||
Montgomery | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 2,653,581 | 2,693,364 | ||
Seabrook | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 5.73% | ' | ||
Maturity date | 1-Jan-16 | ' | ||
Seabrook | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 4,406,016 | 4,444,137 | ||
Greenville | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 5.65% | ' | ||
Maturity date | 1-Mar-16 | ' | ||
Greenville | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 2,207,907 | 2,226,986 | ||
Kemah | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 6.20% | ' | ||
Maturity date | 1-Jun-16 | ' | ||
Kemah | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 8,666,284 | 8,732,981 | ||
Memphis | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 5.67% | ' | ||
Maturity date | 1-Dec-16 | ' | ||
Memphis | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 2,445,084 | 2,465,045 | ||
Tallahassee | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 6.16% | ' | ||
Maturity date | 1-Aug-16 | ' | ||
Tallahassee | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 7,397,484 | 7,446,178 | ||
Houston | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 5.67% | ' | ||
Maturity date | 1-Feb-17 | ' | ||
Houston | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 1,961,286 | 1,981,095 | ||
San Francisco | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 5.84% | ' | ||
Maturity date | 1-Jan-17 | ' | ||
San Francisco | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 10,186,862 | 10,256,163 | ||
Lake Forest | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 6.47% | ' | ||
Maturity date | 1-Oct-17 | ' | ||
Lake Forest | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 18,000,000 | 18,000,000 | ||
Las Vegas II | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 5.72% | ' | ||
Maturity date | 1-Jun-17 | ' | ||
Las Vegas II | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 1,501,554 | 1,511,958 | ||
Pearland | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 5.93% | ' | ||
Maturity date | 1-Jul-17 | ' | ||
Pearland | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 3,416,319 | 3,438,473 | ||
Daphne | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 5.47% | ' | ||
Maturity date | 1-Aug-20 | ' | ||
Daphne | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 1,296,109 | 1,381,213 | ||
Mesa | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 5.38% | ' | ||
Maturity date | 1-Apr-15 | ' | ||
Mesa | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 2,932,407 | 2,968,060 | ||
Riverdale | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 4.00% | [9] | ' | |
Maturity date | 14-May-14 | [9] | ' | |
Riverdale | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | ' | 4,800,000 | [9] | |
Citi Loan | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 5.77% | [10] | ' | |
Maturity date | 6-Feb-21 | [10] | ' | |
Citi Loan | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 27,872,420 | [10] | 28,077,873 | [10] |
Bank of America Loan - 1 | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 5.18% | [11] | ' | |
Maturity date | 1-Nov-15 | [11] | ' | |
Bank of America Loan - 1 | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 4,280,685 | [11] | 4,321,842 | [11] |
Bank of America Loan - 2 | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 5.18% | [12] | ' | |
Maturity date | 1-Nov-15 | [12] | ' | |
Bank of America Loan - 2 | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 6,486,384 | [12] | 6,548,748 | [12] |
Bank of America Loan - 3 | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 5.18% | [13] | ' | |
Maturity date | 1-Nov-15 | [13] | ' | |
Bank of America Loan - 3 | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 11,658,609 | [13] | 11,770,704 | [13] |
Prudential - Long Beach | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 5.27% | [14] | ' | |
Maturity date | 5-Sep-19 | [14] | ' | |
Prudential - Long Beach | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 6,479,404 | [14] | 6,533,640 | [14] |
SF Bay Area - Vallejo | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 6.04% | [15] | ' | |
Maturity date | 1-Jun-14 | [15] | ' | |
SF Bay Area - Vallejo | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | ' | 4,295,098 | [15] | |
Ladera Ranch | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 5.84% | ' | ||
Maturity date | 1-Jun-16 | ' | ||
Ladera Ranch | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 6,622,832 | 6,691,304 | ||
Las Vegas V | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 5.02% | ' | ||
Maturity date | 1-Jul-15 | ' | ||
Las Vegas V | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 1,608,570 | 1,628,783 | ||
Brampton - Ontario, Canada | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 5.25% | [16] | ' | |
Maturity date | 30-Jun-16 | [16] | ' | |
Brampton - Ontario, Canada | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 6,498,136 | [16] | 6,482,879 | [16] |
Citi Stockade Loan - 1 | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 4.60% | [17] | ' | |
Maturity date | 1-Oct-22 | [17] | ' | |
Citi Stockade Loan - 1 | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 18,200,000 | [17] | 18,200,000 | [17] |
KeyBank CMBS Loan | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 4.65% | [18] | ' | |
Maturity date | 1-Nov-22 | [18] | ' | |
KeyBank CMBS Loan | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 30,726,739 | [18] | 30,960,278 | [18] |
Citi Stockade Loan - 2 | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 4.61% | [19] | ' | |
Maturity date | 6-Nov-22 | [19] | ' | |
Citi Stockade Loan - 2 | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 19,362,500 | [19] | 19,362,500 | [19] |
Bank of America Loan - 4 | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 6.33% | [20] | ' | |
Maturity date | 1-Oct-17 | [20] | ' | |
Bank of America Loan - 4 | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 6,357,269 | [20] | 6,394,362 | [20] |
Citi SF Bay Area - Morgan Hill Loan | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 4.08% | [21] | ' | |
Maturity date | 6-Mar-23 | [21] | ' | |
Citi SF Bay Area - Morgan Hill Loan | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | 3,000,000 | [21] | 3,000,000 | [21] |
John Hancock Loan | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Interest Rate | 6.36% | [22] | ' | |
Maturity date | 1-Jun-18 | [22] | ' | |
John Hancock Loan | Secured Debt | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Carrying value | $16,538,885 | [22] | $16,682,984 | [22] |
[1] | This portfolio loan is comprised of 11 discrete mortgage loans on 11 respective properties (Manassas, Marietta, Erlanger, Pittsburgh, Weston, Fort Lee, Oakland Park, Tempe, Phoenix II, Davie and Las Vegas I). Each of the individual loans is cross-collateralized by the other ten. | |||
[2] | Ten of the loans in this portfolio loan bear an interest rate of 5.43%, and the remaining loan bears an interest rate of 5.31%. The weighted average interest rate of this portfolio is 5.42%. | |||
[3] | On January 12, 2011, we encumbered the Dufferin property with a Canadian dollar denominated loan which bears interest at the bank's floating rate plus 3.0% (subject to a reduction in certain circumstances). The rate in effect at June 30, 2014 was 4.74%. The maturity date of this loan was extended in May 2014 to April 15, 2017. | |||
[4] | This portfolio loan is comprised of 11 discrete mortgage loans on 11 respective properties (Peachtree City, Buford, Jonesboro, Ellenwood, Marietta II, Collegeville, Skippack, Ballston Spa, Trenton, Fredericksburg and Sandston). Each of the individual loans had an original term of 30 years and matures on July 1, 2041. ING has the option to require payment of the loan in full every five years beginning on July 1, 2021. | |||
[5] | In December 2011, we entered into a Canadian dollar denominated construction loan with an aggregate commitment amount of approximately $9.2 million. Such loan bears interest at the bank's floating rate, plus 2% (totaling 5.0% as of June 30, 2014). | |||
[6] | On October 28, 2013, through our Operating Partnership and certain property-owning special purpose entities wholly-owned by our Operating Partnership, we entered into the KeyBank Revolver, which matures on October 25, 2016. Such loan encumbers the Homeland Portfolio properties, the Knoxville Portfolio properties and nine other properties (Gulf Breeze II, El Paso I, Toms River II, North Charleston, Phoenix I, Riverdale, SF Bay Area - Vallejo, Hampton II, and Chandler). This loan is a LIBOR based variable rate loan, and such rate is based on 30-day LIBOR, which including the applicable spread equaled an interest rate of 1.66% as of June 30, 2014. The interest rate swap with a notional amount of $45 million that was originally entered into in connection with the Second Restated KeyBank Loan remains outstanding. For additional discussion, see "KeyBank Revolver" below. | |||
[7] | This loan encumbers the Las Vegas VII and Las Vegas VIII properties. The net book value of the encumbered properties as of June 30, 2014 was approximately $8.9 million. Such amounts are only available to satisfy the obligations of this loan. | |||
[8] | The net book value of the Chantilly property as of June 30, 2014 was approximately $6.7 million. Such amounts are only available to satisfy the obligations of this loan. | |||
[9] | On April 28, 2014, this loan was repaid in full and the related property is now encumbered under the KeyBank Revolver. | |||
[10] | This portfolio loan encumbers 11 properties (Biloxi, Gulf Breeze I, Alpharetta, Florence II, Jersey City, West Mifflin, Chicago - 95th St., Chicago - Western Ave., Chicago - Ogden Ave., Chicago - Roosevelt Rd. and Las Vegas IV). The net book value of the encumbered properties as of June 30, 2014 was approximately $49.6 million. Such amounts are only available to satisfy the obligations of this loan. | |||
[11] | This loan encumbers the Lawrenceville I and II properties. | |||
[12] | This loan encumbers the Concord, Hickory and Morganton properties. | |||
[13] | This loan encumbers the El Paso II, III, IV & V properties as well as the Dallas property. | |||
[14] | This loan is cross-collateralized by the 11 properties discussed in footnote (2) to this table. | |||
[15] | On May 1, 2014, this loan was repaid in full and the related property is now encumbered under the KeyBank Revolver. | |||
[16] | In September 2012, we entered into a Canadian dollar denominated construction loan with an aggregate potential commitment amount of approximately $9.2 million. Such loan bears interest at the bank's floating rate, plus 2.25% (totaling 5.25% as of June 30, 2014). | |||
[17] | This portfolio loan encumbers 10 properties (Savannah I, Savannah II, Columbia, Lexington I, Stuart I, Lexington II, Stuart II, Bluffton, Wilmington Island and Myrtle Beach). The net book value of the encumbered properties as of June 30, 2014 was approximately $33.9 million. Such amounts are only available to satisfy the obligations of this loan. | |||
[18] | This portfolio loan encumbers nine properties (Los Angeles - La Cienega, Las Vegas III, Las Vegas VI, Hampton, SF Bay Area - Gilroy, Toms River, Crescent Springs, Florence and Walton). The net book value of the encumbered properties as of June 30, 2014 was approximately $40.8 million. Such amounts are only available to satisfy the obligations of this loan. | |||
[19] | This portfolio loan encumbers six properties (Mt. Pleasant I, Charleston I, Charleston II, Mt. Pleasant II, Charleston III, and Mt. Pleasant III). The net book value of the encumbered properties as of June 30, 2014 was approximately $36.1 million. Such amounts are only available to satisfy the obligations of this loan. | |||
[20] | This loan encumbers the Ridgeland and Canton properties. | |||
[21] | This loan encumbers the Morgan Hill property. The net book value of the encumbered property as of June 30, 2014 was approximately $5.2 million. Such amount is only available to satisfy the obligations of this loan. | |||
[22] | This loan encumbers the Midland I, Coppell, Midland II, Arlington and Weatherford properties. |
Summary_of_Secured_Debt_Parent
Summary of Secured Debt (Parenthetical) (Detail) (USD $) | 6 Months Ended | 6 Months Ended | 0 Months Ended | 6 Months Ended | 6 Months Ended | 6 Months Ended | 6 Months Ended | 6 Months Ended | ||||||||||||||||||||||||||||
Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jan. 12, 2011 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Dec. 31, 2011 | Jun. 30, 2014 | Mar. 31, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Sep. 30, 2012 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Oct. 28, 2013 | Jun. 30, 2014 | Jun. 30, 2014 | |||||||||||||
Property | Knoxville Portfolio | Prudential Portfolio Loan | Dufferin - Toronto - Ontario, Canada | Dufferin - Toronto - Ontario, Canada | Dufferin - Toronto - Ontario, Canada | ING Loan | Mississauga - Ontario, Canada | Mississauga - Ontario, Canada | KeyBank Revolver | KeyBank Revolver | Citi Las Vegas Loan | Chantilly - VA | Canadian dollars denominated loan | Canadian dollars denominated loan | Citi Loan | Citi Stockade Loan - 1 | KeyBank CMBS Loan | Citi Stockade Loan - 2 | Citi SF Bay Area - Morgan Hill Loan | Second Restated KeyBank Loan | Second Restated KeyBank Loan | SF Bay Area - Vallejo | Riverdale | |||||||||||||
Loan | Property | Loan | Maximum | Property | Property | Property | Property | KeyBank Revolver | KeyBank Revolver | |||||||||||||||||||||||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Repayment date of loan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'May 1, 2014 | 'April 28, 2014 | ||||||||||||
Numbers of discrete mortgage loans related to prudential portfolio loan | 11 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Numbers of properties related to prudential portfolio loan | 11 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Number of loans cross-collateralized with each respective loan | 10 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Number of loans with an interest rate of 5.43% | ' | ' | 10 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Interest rate | ' | ' | 5.43% | ' | ' | ' | ' | 5.00% | ' | ' | ' | ' | ' | 5.25% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Interest rate of remaining loan in portfolio | ' | ' | 5.31% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Weighted average interest rate of portfolio | 5.50% | ' | 5.42% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Interest rate premium over bank's floating rate | ' | ' | ' | 3.00% | ' | ' | ' | 2.00% | ' | ' | ' | ' | ' | 2.25% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Effective interest rate | ' | ' | 5.42% | [1],[2] | ' | 4.74% | [3] | ' | 5.47% | [4] | 5.00% | [5] | ' | 1.66% | [6] | ' | 5.26% | [7] | 4.75% | [8] | ' | ' | 5.77% | [9] | 4.60% | [10] | 4.65% | [11] | 4.61% | [12] | 4.08% | [13] | ' | ' | ' | ' |
Maturity date | ' | ' | 5-Sep-19 | [1],[2] | ' | 15-Apr-17 | [3] | 15-Apr-17 | 1-Jul-21 | [4] | 31-Oct-14 | [5] | ' | 25-Oct-16 | [6] | ' | 6-Jun-21 | [7] | 6-Jun-22 | [8] | ' | ' | 6-Feb-21 | [9] | 1-Oct-22 | [10] | 1-Nov-22 | [11] | 6-Nov-22 | [12] | 6-Mar-23 | [13] | ' | ' | ' | ' |
Number of existing encumbered properties | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 11 | 10 | 9 | 6 | ' | ' | ' | ' | ' | ||||||||||||
Net book value of encumbered properties | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $8,900,000 | $6,700,000 | ' | ' | $49,600,000 | $33,900,000 | $40,800,000 | $36,100,000 | $5,200,000 | ' | ' | ' | ' | ||||||||||||
Prudential long beach cross collateralized by numbers of properties related to prudential portfolio loan | 11 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Numbers of properties related to ING loan | 11 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Numbers of discrete mortgage loans related to ING loan | 11 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Term of each individual loans | ' | ' | ' | ' | ' | ' | '30 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Maturity date of ING Loan | ' | ' | ' | ' | ' | ' | 1-Jul-41 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Payment of loan, successive period after commencement date | ' | ' | ' | ' | ' | ' | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Commitment amount | ' | ' | ' | ' | ' | ' | ' | ' | 9,200,000 | ' | 75,000,000 | ' | ' | ' | 9,200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Revolving loan maturity date | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25-Oct-16 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 24-Dec-14 | ' | ' | ' | ||||||||||||
Notional amount for interest rate swap | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $45,000,000 | $45,000,000 | ' | ' | ||||||||||||
Number of unencumbered properties | ' | 9 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
[1] | This portfolio loan is comprised of 11 discrete mortgage loans on 11 respective properties (Manassas, Marietta, Erlanger, Pittsburgh, Weston, Fort Lee, Oakland Park, Tempe, Phoenix II, Davie and Las Vegas I). Each of the individual loans is cross-collateralized by the other ten. | |||||||||||||||||||||||||||||||||||
[2] | Ten of the loans in this portfolio loan bear an interest rate of 5.43%, and the remaining loan bears an interest rate of 5.31%. The weighted average interest rate of this portfolio is 5.42%. | |||||||||||||||||||||||||||||||||||
[3] | On January 12, 2011, we encumbered the Dufferin property with a Canadian dollar denominated loan which bears interest at the bank's floating rate plus 3.0% (subject to a reduction in certain circumstances). The rate in effect at June 30, 2014 was 4.74%. The maturity date of this loan was extended in May 2014 to April 15, 2017. | |||||||||||||||||||||||||||||||||||
[4] | This portfolio loan is comprised of 11 discrete mortgage loans on 11 respective properties (Peachtree City, Buford, Jonesboro, Ellenwood, Marietta II, Collegeville, Skippack, Ballston Spa, Trenton, Fredericksburg and Sandston). Each of the individual loans had an original term of 30 years and matures on July 1, 2041. ING has the option to require payment of the loan in full every five years beginning on July 1, 2021. | |||||||||||||||||||||||||||||||||||
[5] | In December 2011, we entered into a Canadian dollar denominated construction loan with an aggregate commitment amount of approximately $9.2 million. Such loan bears interest at the bank's floating rate, plus 2% (totaling 5.0% as of June 30, 2014). | |||||||||||||||||||||||||||||||||||
[6] | On October 28, 2013, through our Operating Partnership and certain property-owning special purpose entities wholly-owned by our Operating Partnership, we entered into the KeyBank Revolver, which matures on October 25, 2016. Such loan encumbers the Homeland Portfolio properties, the Knoxville Portfolio properties and nine other properties (Gulf Breeze II, El Paso I, Toms River II, North Charleston, Phoenix I, Riverdale, SF Bay Area - Vallejo, Hampton II, and Chandler). This loan is a LIBOR based variable rate loan, and such rate is based on 30-day LIBOR, which including the applicable spread equaled an interest rate of 1.66% as of June 30, 2014. The interest rate swap with a notional amount of $45 million that was originally entered into in connection with the Second Restated KeyBank Loan remains outstanding. For additional discussion, see "KeyBank Revolver" below. | |||||||||||||||||||||||||||||||||||
[7] | This loan encumbers the Las Vegas VII and Las Vegas VIII properties. The net book value of the encumbered properties as of June 30, 2014 was approximately $8.9 million. Such amounts are only available to satisfy the obligations of this loan. | |||||||||||||||||||||||||||||||||||
[8] | The net book value of the Chantilly property as of June 30, 2014 was approximately $6.7 million. Such amounts are only available to satisfy the obligations of this loan. | |||||||||||||||||||||||||||||||||||
[9] | This portfolio loan encumbers 11 properties (Biloxi, Gulf Breeze I, Alpharetta, Florence II, Jersey City, West Mifflin, Chicago - 95th St., Chicago - Western Ave., Chicago - Ogden Ave., Chicago - Roosevelt Rd. and Las Vegas IV). The net book value of the encumbered properties as of June 30, 2014 was approximately $49.6 million. Such amounts are only available to satisfy the obligations of this loan. | |||||||||||||||||||||||||||||||||||
[10] | This portfolio loan encumbers 10 properties (Savannah I, Savannah II, Columbia, Lexington I, Stuart I, Lexington II, Stuart II, Bluffton, Wilmington Island and Myrtle Beach). The net book value of the encumbered properties as of June 30, 2014 was approximately $33.9 million. Such amounts are only available to satisfy the obligations of this loan. | |||||||||||||||||||||||||||||||||||
[11] | This portfolio loan encumbers nine properties (Los Angeles - La Cienega, Las Vegas III, Las Vegas VI, Hampton, SF Bay Area - Gilroy, Toms River, Crescent Springs, Florence and Walton). The net book value of the encumbered properties as of June 30, 2014 was approximately $40.8 million. Such amounts are only available to satisfy the obligations of this loan. | |||||||||||||||||||||||||||||||||||
[12] | This portfolio loan encumbers six properties (Mt. Pleasant I, Charleston I, Charleston II, Mt. Pleasant II, Charleston III, and Mt. Pleasant III). The net book value of the encumbered properties as of June 30, 2014 was approximately $36.1 million. Such amounts are only available to satisfy the obligations of this loan. | |||||||||||||||||||||||||||||||||||
[13] | This loan encumbers the Morgan Hill property. The net book value of the encumbered property as of June 30, 2014 was approximately $5.2 million. Such amount is only available to satisfy the obligations of this loan. |
Secured_Debt_Additional_Inform
Secured Debt - Additional Information (Detail) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 | Oct. 28, 2013 | Jan. 12, 2012 | Dec. 27, 2011 | Jun. 30, 2014 | Oct. 28, 2013 | Apr. 05, 2013 | Oct. 10, 2012 | Jan. 12, 2012 | Dec. 27, 2011 | Dec. 27, 2011 | Dec. 27, 2011 | Dec. 27, 2011 | Apr. 28, 2014 | Oct. 28, 2013 | Mar. 31, 2014 | Jun. 30, 2014 | Apr. 28, 2014 | Oct. 28, 2013 | Jul. 30, 2014 | Jul. 30, 2014 | Oct. 28, 2013 | Apr. 28, 2014 | Apr. 28, 2014 | Jun. 30, 2014 | Jun. 30, 2014 |
Second Restated KeyBank Loan | Second Restated KeyBank Loan | Second Restated KeyBank Loan | Second Restated KeyBank Loan | Second Restated KeyBank Loan | Second Restated KeyBank Loan | Second Restated KeyBank Loan | Second Restated KeyBank Loan | Second Restated KeyBank Loan | Second Restated KeyBank Loan | Second Restated KeyBank Loan | Restated Key Bank Credit Facility | KeyBank Revolver | KeyBank Revolver | KeyBank Revolver | KeyBank Revolver | KeyBank Revolver | KeyBank Revolver | KeyBank Revolver | KeyBank Revolver | KeyBank Revolver | KeyBank Revolver | KeyBank Revolver | KeyBank Revolver | KeyBank Revolver | |||
Option | Property | GA | FL | lender | Property | Subsequent Event | Subsequent Event | Knoxville Portfolio | Riverdale | SF Bay Area - Vallejo | Maximum | Minimum | |||||||||||||||
Property | Property | ||||||||||||||||||||||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net book values of secured properties | $650,000,000 | $647,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum borrowings under revolving loan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 82,000,000 | ' | ' | 30,000,000 | ' | ' | ' | ' | ' | 75,000,000 | ' | ' | ' | ' | ' | ' | ' |
Draw from revolving loan | ' | ' | ' | 5,400,000 | 56,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 18,000,000 | 71,000,000 | ' | ' | ' | ' | 10,000,000 | ' | 26,000,000 | ' | ' | ' | ' |
Repayment of loan | ' | ' | 45,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Properties acquired | ' | ' | ' | ' | ' | ' | 12 | ' | ' | ' | ' | 10 | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Aggregate commitment amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 75,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase in aggregate commitment amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | 200,000,000 | 10,000,000 |
Number of participating lenders | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount outstanding under loan | ' | ' | ' | ' | ' | ' | ' | 45,000,000 | 55,000,000 | 82,000,000 | ' | ' | ' | 20,000,000 | ' | ' | ' | ' | 89,000,000 | ' | ' | 99,000,000 | ' | ' | ' | ' | ' |
Proceeds of borrowings to repay the outstanding mortgage | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4,800,000 | 4,300,000 | ' | ' |
Revolving loan initial term | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '3 years | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Line of credit facility maturity date | ' | ' | ' | ' | ' | 24-Dec-14 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25-Oct-16 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest rate swap amount | ' | ' | ' | ' | ' | 45,000,000 | 45,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Current interest rate of interest rate of swap | ' | ' | ' | ' | ' | 5.41% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.40% | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Credit agreement description | ' | ' | ' | ' | ' | 'Subject to two, one-year extension options (subject to the fulfillment of certain conditions), and required monthly interest-only payments. | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'The KeyBank Revolver has an initial term of three years, maturing on October 25, 2016, with two one-year extension options subject to certain conditions outlined further in the credit agreement for the KeyBank Revolver (the "Credit Agreement") | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Reduction in aggregate commitments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,000,000 |
Amount syndicated | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25,000,000 |
Self storage properties | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Other recourse debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Other non-recourse debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 75,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percent of collateral properties used for aggregate borrowing capacity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 60.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Service Coverage Ratio | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.35 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total Leverage Ratio | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 60.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Minimum Tangible Net Worth | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 250,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Minimum Interest Service Coverage Ratio | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.85 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Minimum Fixed Charge Ratio | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.6 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ratio of varying rate Indebtedness | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 30.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of required Loan to Value Ratio | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 60.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Worth of portfolio | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 80,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount of monthly payments | ' | ' | ' | ' | ' | $1,666,667 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Line of credit facility, potential term of extension options | ' | ' | ' | ' | ' | '1 year | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Line of credit facility, number of extension options | ' | ' | ' | ' | ' | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted average interest rate of fixed rate debt | 5.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Future_Principal_Payment_Requi
Future Principal Payment Requirements on Outstanding Secured Debt (Detail) (USD $) | Jun. 30, 2014 |
Debt Disclosure [Abstract] | ' |
2014 | $8,988,872 |
2015 | 31,081,492 |
2016 | 132,883,456 |
2017 | 49,718,520 |
2018 | 18,827,369 |
2019 and thereafter | 155,752,897 |
Total payments | 397,252,606 |
Unamortized fair value adjustment | 863,714 |
Total | 398,116,320 |
Total payments | $397,252,606 |
Derivative_Instruments_Cash_Fl2
Derivative Instruments - Cash Flow Hedge of Interest Rate Risk - Additional Information (Detail) (USD $) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ' | ' | ' | ' |
Ineffective portion of change in fair value of derivatives instruments recognized in earnings | $0 | $0 | $0 | $0 |
Interest expense | 4,419,503 | 4,686,164 | 9,039,661 | 9,350,994 |
Fair value of derivatives in a net liability position | 172,000 | ' | 172,000 | ' |
Termination value in case of breach of provisions | ' | ' | 172,000 | ' |
Interest Rate Swap | ' | ' | ' | ' |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ' | ' | ' | ' |
Number of instruments | 1 | ' | 1 | ' |
Reclassification from AOCI to Interest Expense | ' | ' | ' | ' |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ' | ' | ' | ' |
Interest expense | ' | ' | $167,000 | ' |
Interest_Rate_Derivative_Desig
Interest Rate Derivative Designated as Cash Flow Hedge of Interest Rate Risk (Detail) (Interest Rate Swap, USD $) | Jun. 30, 2014 |
Derivative | |
Interest Rate Swap | ' |
Derivative [Line Items] | ' |
Number of instruments | 1 |
Notional | $45,000,000 |
Fair_Value_of_Derivative_Finan
Fair Value of Derivative Financial Instruments as well as Classification on Balance Sheet (Detail) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Other Assets | ' | ' |
Derivatives, Fair Value [Line Items] | ' | ' |
Assets | ' | ' |
Accounts Payable and Accrued Liabilities | ' | ' |
Derivatives, Fair Value [Line Items] | ' | ' |
Liabilities | $167,203 | $303,051 |
Related_Party_Transactions_Add
Related Party Transactions - Additional Information (Detail) (USD $) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2013 | |
Related Party Transaction [Line Items] | ' | ' | ' | ' | ' |
Maximum period for reimbursement of offering cost | ' | ' | '60 days | ' | ' |
Maximum offering cost rate | ' | ' | 3.50% | ' | ' |
Gross proceeds from offering, threshold percentage of expenses for reimbursement | 15.00% | ' | 15.00% | ' | ' |
Follow-on offering termination date | ' | ' | 22-Sep-13 | ' | ' |
Rate of acquisition fees of purchase price of contract | 2.50% | ' | 2.50% | ' | ' |
Monthly asset management fee one twelfth of one percentage of asset value | ' | ' | 'One-twelfth of 1.0% | ' | ' |
Monthly asset management fee one twelfth of less than one percentage of asset value payable if asset value exceeds $500 million | ' | ' | 'One-twelfth of 0.75% | ' | ' |
Aggregate asset value specific exceed | ' | ' | $500,000,000 | ' | ' |
Minimum percentage of distribution | ' | ' | 100.00% | ' | ' |
Property management fees percentage of property revenue for REIT I, REIT II and the SS I, DST, Madison DST and Colonial DST acquisitions | ' | ' | 2.00% | ' | ' |
Advisory fees percentage of sale price of property | ' | ' | 3.00% | ' | ' |
Commission percentage of sale price of property | ' | ' | 6.00% | ' | ' |
Cumulative, non compounded, annual return on such stockholders' invested capital | ' | ' | 6.00% | ' | ' |
Operating expenses reimbursement percentage of average investment in assets | ' | ' | 2.00% | ' | ' |
Operating expenses reimbursement percentage of net income | ' | ' | 25.00% | ' | ' |
Operating expenses exceed limitation | ' | ' | '12 months | ' | ' |
Maximum days for disclosure fact | ' | ' | '60 days | ' | ' |
Second Amended and Restated Advisory Agreement entered date | ' | ' | 27-Sep-12 | ' | ' |
Subordinated distributions description | ' | ' | 'In the case of each of the foregoing distributions, our Advisor's receipt of the distribution is subordinate to return of capital to our stockholders plus at least a 6% cumulative, non-compounded return, and our Advisor's share of the distribution is 5%, 10%, or 15%, depending on the return level to our stockholders. | ' | ' |
Sale commission fees percentage of proceeds from Primary Offering | ' | ' | 7.00% | ' | ' |
Maximum dealer manager commission fee percentage of proceeds from Primary Offering | ' | ' | 3.00% | ' | ' |
Underwriting commission | ' | ' | 10.00% | ' | ' |
Maximum percentage other non-accountable expenses | ' | ' | 3.00% | ' | ' |
Percentage owned by chief executive officer in Dealer Manager | ' | ' | 15.00% | ' | ' |
Percentage of fee of property manager | ' | ' | 6.00% | ' | ' |
Return needed for before the Property Manager entitled to property management fees on properties acquired via the REIT II merger | ' | ' | $0.70 | ' | ' |
Increase in agreement term due to revision | ' | ' | '3 years | ' | ' |
Automatic extension period | ' | ' | '3 years | ' | ' |
Amounts due to affiliates | 1,299,562 | ' | 1,299,562 | ' | 1,741,518 |
Percentage of tenant premium paid approximately, fees provided by program insurer | ' | ' | 50.00% | ' | ' |
Revenue recorded in connection with reinsurance program | 500,000 | 400,000 | 900,000 | 800,000 | ' |
Auction fees | 27,000 | 3,000 | 63,000 | 3,000 | ' |
RETI I and RETI II [Member] | ' | ' | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' | ' | ' |
Subordinated distributions description | ' | ' | 'The receipt of the distribution by the advisors to REIT I and REIT II is subordinate to return of capital to the original REIT I and REIT II stockholders plus at least a 7% cumulative, non-compounded return, and such advisors' share of the distribution is 15%. | ' | ' |
REIT II [Member] | ' | ' | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' | ' | ' |
Property management fees | $67,000 | $60,000 | $132,000 | $85,000 | ' |
Executive Officer | Auction Company | ' | ' | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' | ' | ' |
Officers' collective ownership | ' | ' | 9.00% | ' | ' |
Summary_of_Related_Party_Costs
Summary of Related Party Costs Incurred (Detail) (USD $) | 3 Months Ended | 6 Months Ended | ||||||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | |||||
Additional Paid-in Capital | ' | ' | ' | ' | ||||
Selling commissions | ' | $2,084,569 | ' | $2,929,034 | ||||
Dealer Manager fee | ' | 893,386 | ' | 1,255,300 | ||||
Reimbursement of offering costs | ' | 111,432 | ' | 224,129 | ||||
Total | 3,315,601 | 5,513,766 | 7,078,699 | 9,182,325 | ||||
Reimbursement of operating expenses | ' | ' | ' | ' | ||||
Expensed | ' | ' | ' | ' | ||||
Related party costs expensed | 253,558 | [1] | 13,956 | [1] | 620,904 | [1] | 22,101 | [1] |
Asset management fees | ' | ' | ' | ' | ||||
Expensed | ' | ' | ' | ' | ||||
Related party costs expensed | 1,529,666 | [2] | 1,181,308 | [2] | 3,041,934 | [2] | 2,356,940 | [2] |
Property management fees | ' | ' | ' | ' | ||||
Expensed | ' | ' | ' | ' | ||||
Related party costs expensed | 1,428,674 | [3],[4] | 1,176,105 | [3],[4] | 2,803,616 | [3],[4] | 2,288,202 | [3],[4] |
Acquisition expenses | ' | ' | ' | ' | ||||
Expensed | ' | ' | ' | ' | ||||
Related party costs expensed | $103,703 | $53,010 | $612,245 | $106,619 | ||||
[1] | During the three and six months ended June 30, 2013, our Advisor permanently waived certain reimbursable indirect costs, primarily payroll and related overhead costs, related to administrative and management services, totaling approximately $330,000 and $625,000, respectively. Such amounts were waived permanently and accordingly, will not be paid to our Advisor. Such reimbursable indirect costs were not waived by the Advisor during the three and six months ended June 30, 2014, and totaled approximately $249,000 and $611,000, respectively. | |||||||
[2] | During the three and six months ended June 30, 2013, our Advisor permanently waived asset management fees related to the Stockade Portfolio totaling approximately $173,000 and $349,000, respectively. Such amounts were waived permanently and accordingly, will not be paid to our Advisor. Such asset management fees were not waived by the Advisor during the three and six months ended June 30, 2014, and totaled approximately $176,000 and $353,000, respectively. | |||||||
[3] | During the three and six months ended June 30, 2013, property management fees included approximately none and $27,000, respectively, of fees paid to the former sub-property manager of our Canadian properties. Such sub-property management agreement was terminated effective March 31, 2013 at a cost of approximately $28,000. | |||||||
[4] | During the three and six months ended June 30, 2014 and 2013, our Property Manager permanently waived certain costs, reimbursements and fees, including construction management fees, tenant insurance administration fees and expense reimbursements related to certain off-site property management employees. Such amounts totaled approximately $174,000 and $130,000, respectively for the three months ended June 30, 2014 and 2013, and approximately $356,000 and $280,000, respectively for the six months ended June 30, 2014 and 2013. These amounts were waived permanently and accordingly, will not be paid to our Property Manager. |
Summary_of_Related_Party_Costs1
Summary of Related Party Costs Incurred (Parenthetical) (Detail) (USD $) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2014 | Jun. 30, 2013 | Mar. 31, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | |
Related Party Transaction [Line Items] | ' | ' | ' | ' | ' |
Reimbursable indirect costs waived | ' | $330,000 | ' | ' | $625,000 |
Reimbursable indirect costs not waived | 249,000 | ' | ' | 611,000 | ' |
Property management fees to the sub-property manager of Canadian properties | 0 | ' | ' | 27,000 | ' |
Sub-property management agreement terminated | ' | ' | 28,000 | ' | ' |
Property Manager waived certain costs | 174,000 | 130,000 | ' | 356,000 | 280,000 |
Stockade Portfolio | ' | ' | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' | ' | ' |
Waived asset management fees | ' | 173,000 | ' | ' | 349,000 |
Asset management fees not waived | $176,000 | ' | ' | $353,000 | ' |
Commitments_and_Contingencies_
Commitments and Contingencies - Additional Information (Detail) (USD $) | 6 Months Ended | 3 Months Ended | 6 Months Ended | 0 Months Ended | 6 Months Ended | 0 Months Ended | ||||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Sep. 28, 2013 | Jun. 30, 2014 | Sep. 28, 2013 | Sep. 23, 2013 | |
SF Bay Area - San Lorenzo | SF Bay Area - San Lorenzo | SF Bay Area - San Lorenzo | SF Bay Area - San Lorenzo | Distribution Reinvestment Plan | Distribution Reinvestment Plan | Distribution Reinvestment Plan | Distribution Reinvestment Plan | |||
Maximum | Maximum | |||||||||
Commitments and Contingencies [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Previous purchase price per share | ' | ' | ' | ' | ' | ' | ' | $9.50 | ' | ' |
Previous purchase price percentage of fair market value of a share | ' | ' | ' | ' | ' | ' | ' | 95.00% | ' | ' |
Percentage of offering price under distribution reinvestment plan | ' | ' | ' | ' | ' | ' | ' | 95.00% | ' | ' |
Current purchase price per share | ' | ' | ' | ' | ' | ' | ' | $10.25 | ' | ' |
Amendment, suspension or termination period of share | ' | ' | ' | ' | ' | ' | '10 days | ' | ' | ' |
Additional shares registered | $9,131,346 | $7,264,595 | ' | ' | ' | ' | ' | ' | $51,250,000 | $51,250,000 |
Plan effective date | ' | ' | ' | ' | ' | ' | ' | 28-Sep-13 | ' | ' |
Shares issued pursuant to distribution reinvestment plan | ' | ' | ' | ' | ' | ' | ' | 1,300,000 | ' | ' |
Sales commission or dealer manager fee | ' | ' | ' | ' | ' | ' | ' | 0 | ' | ' |
Minimum return required on property contributed for class D unit holders to modify exchange rights | $0.70 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Limited partnership unit, conversion description | 'The limited partners of our Operating Partnership have the right to cause our Operating Partnership to redeem their limited partnership units for cash equal to the value of an equivalent number of our shares, or, at our option, we may purchase their limited partnership units by issuing one share of our common stock for each limited partnership unit redeemed. | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Remaining term of lease | ' | ' | ' | ' | '21 years | ' | ' | ' | ' | ' |
Lease Extension Term Under Option One | ' | ' | ' | ' | '35 years | ' | ' | ' | ' | ' |
Rent expense | ' | ' | 37,000 | 74,000 | 37,000 | 74,000 | ' | ' | ' | ' |
Minimum lease payment 2014 | ' | ' | 67,000 | ' | 67,000 | ' | ' | ' | ' | ' |
Minimum lease payment 2015 | ' | ' | 139,000 | ' | 139,000 | ' | ' | ' | ' | ' |
Minimum lease payment 2016 | ' | ' | 139,000 | ' | 139,000 | ' | ' | ' | ' | ' |
Minimum lease payment 2017 | ' | ' | 139,000 | ' | 139,000 | ' | ' | ' | ' | ' |
Minimum lease payment 2018 | ' | ' | 139,000 | ' | 139,000 | ' | ' | ' | ' | ' |
Minimum lease payment thereafter | ' | ' | $2,415,000 | ' | $2,415,000 | ' | ' | ' | ' | ' |
Declaration_of_Distributions_A
Declaration of Distributions - Additional Information (Detail) (USD $) | Jun. 25, 2014 |
Equity [Abstract] | ' |
Common stock per share outstanding per day declared | $0.00 |
Summary_of_Quarterly_Financial
Summary of Quarterly Financial Information (Detail) (USD $) | 3 Months Ended | 6 Months Ended | |||||
Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | |
Quarterly Financial Information Disclosure [Abstract] | ' | ' | ' | ' | ' | ' | ' |
Total revenues | $24,321,406 | $23,132,944 | $22,503,218 | $21,292,574 | $19,931,208 | $47,454,350 | $39,339,149 |
Total operating expenses | 18,566,277 | 19,105,230 | 19,315,207 | 17,229,995 | 16,667,044 | 37,671,507 | 33,224,929 |
Operating income | 5,755,129 | 4,027,714 | 3,188,011 | 4,062,579 | 3,264,164 | 9,782,843 | 6,114,220 |
Net income (loss) | 1,449,237 | -1,039,656 | -2,639,352 | -689,288 | -1,949,099 | 409,581 | -4,116,558 |
Net income (loss) attributable to the Company | $1,433,221 | ($1,033,683) | ($2,637,508) | ($693,245) | ($1,949,079) | $399,538 | ($4,116,303) |
Net income (loss) per share-basic and diluted | $0.03 | ($0.02) | ($0.05) | ($0.01) | ($0.04) | ' | ' |
Subsequent_Events_Additional_I
Subsequent Events - Additional Information (Detail) (USD $) | 0 Months Ended | 0 Months Ended | 0 Months Ended | 0 Months Ended | ||||||||||
Apr. 28, 2014 | Oct. 28, 2013 | Apr. 28, 2014 | Jul. 31, 2014 | Jul. 31, 2014 | Jul. 31, 2014 | Jul. 31, 2014 | Jul. 31, 2014 | Jul. 31, 2014 | Jul. 31, 2014 | Jul. 31, 2014 | Jul. 31, 2014 | Jul. 30, 2014 | Jul. 30, 2014 | |
KeyBank Revolver | KeyBank Revolver | KeyBank Revolver | Subsequent Event | Subsequent Event | Subsequent Event | Subsequent Event | Subsequent Event | Subsequent Event | Subsequent Event | Subsequent Event | Subsequent Event | Subsequent Event | Subsequent Event | |
SSGT Operating Partnership | LIBOR | Westport Lax LLC | Option A Through January 31, 2017 | Option A Thereafter | Option B Through January 31, 2017 | Option B Thereafter | KeyBank Revolver | KeyBank Revolver | ||||||
LIBOR | LIBOR | |||||||||||||
Subsequent Event [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of interest owned | ' | ' | ' | ' | ' | ' | ' | 12.00% | ' | ' | ' | ' | ' | ' |
Interest owned by Hawthorne LLC | ' | ' | ' | ' | ' | ' | ' | 78.00% | ' | ' | ' | ' | ' | ' |
Entitled distribution on investment | ' | ' | ' | ' | ' | ' | ' | 10.00% | ' | ' | ' | ' | ' | ' |
Combined carrying value of investment | ' | ' | ' | $8,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated value of net proceeds | ' | ' | ' | 10,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount outstanding under loan | ' | ' | 89,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 99,000,000 |
Draw from revolving loan | 18,000,000 | 71,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,000,000 | ' |
Preferred equity investment agreed to be provide by subsidiary | ' | ' | ' | ' | 18,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Aggregate preferred units | ' | ' | ' | ' | 724,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Aggregate preferred units per share | ' | ' | ' | ' | $25 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred investor distributions rate of interest | ' | ' | ' | ' | ' | ' | 6.50% | ' | 4.35% | 6.35% | 10.85% | 12.85% | ' | ' |
Investment by preferred investor | ' | ' | ' | ' | ' | $7,000,000 | ' | ' | ' | ' | ' | ' | ' | ' |