Cover
Cover - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Mar. 15, 2024 | Jun. 30, 2022 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Document Period End Date | Dec. 31, 2023 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2023 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity File Number | 000-54047 | ||
Entity Registrant Name | LIGHTSTONE VALUE PLUS REIT II, INC. | ||
Entity Central Index Key | 0001436975 | ||
Entity Tax Identification Number | 83-0511223 | ||
Entity Incorporation, State or Country Code | MD | ||
Entity Address, Address Line One | 1985 Cedar Bridge Avenue | ||
Entity Address, Address Line Two | Suite 1 | ||
Entity Address, City or Town | Lakewood | ||
Entity Address, State or Province | NJ | ||
Entity Address, Postal Zip Code | 08701 | ||
City Area Code | 732 | ||
Local Phone Number | 367-0129 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 0 | ||
Entity Common Stock, Shares Outstanding | 16,400,000 | ||
Documents Incorporated by Reference [Text Block] | None. | ||
Document Financial Statement Error Correction [Flag] | false | ||
Auditor Name | EisnerAmper LLP | ||
Auditor Name | 274 | ||
Auditor Location | West Palm Beach, Florida |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Investment property: | ||
Land and improvements | $ 26,152 | $ 32,208 |
Building and improvements | 146,129 | 177,550 |
Furniture and fixtures | 28,883 | 33,037 |
Construction in progress | 128 | 125 |
Gross investment property | 201,292 | 242,920 |
Less accumulated depreciation | (58,490) | (62,835) |
Net investment property | 142,802 | 180,085 |
Investments in unconsolidated affiliated entities | 13,415 | 13,793 |
Cash and cash equivalents | 36,192 | 42,233 |
Marketable securities, available for sale | 9,287 | 4,193 |
Restricted cash | 4,549 | 333 |
Accounts receivable and other assets | 3,194 | 4,805 |
Total Assets | 209,439 | 245,442 |
Liabilities and Stockholders’ Equity | ||
Accounts payable and other accrued expenses | 6,871 | 7,977 |
Mortgages payable, net | 100,820 | 118,180 |
Distributions payable | 1,275 | |
Due to related party | 360 | 462 |
Total liabilities | 109,326 | 126,619 |
Company’s stockholders’ equity: | ||
Preferred shares, $0.01 par value, 10.0 million shares authorized, none issued and outstanding | ||
Common stock, $0.01 par value, 100.0 million shares authorized, 17.0 million and 17.2 million shares issued and outstanding, respectively | 169 | 171 |
Additional paid-in-capital | 143,219 | 144,971 |
Accumulated other comprehensive income | 7 | |
Accumulated deficit | (54,284) | (37,663) |
Total Company stockholders’ equity | 89,104 | 107,486 |
Noncontrolling interests | 11,009 | 11,337 |
Total Stockholders’ Equity | 100,113 | 118,823 |
Total Liabilities and Stockholders’ Equity | $ 209,439 | $ 245,442 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Preferred Stock, par value per share | $ 0.01 | $ 0.01 |
Preferred Stock, shares authorized | 10,000 | 10,000 |
Preferred Stock, shares issued | 0 | 0 |
Preferred Stock, shares outstanding | 0 | 0 |
Common Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Common Stock, shares authorized | 100,000 | 100,000 |
Common Stock, shares issued | 17,000 | 17,200 |
Common Stock, shares outstanding | 17,000 | 17,200 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Income Statement [Abstract] | ||
Revenues | $ 53,632 | $ 55,261 |
Expenses: | ||
Property operating expenses | 37,986 | 39,239 |
Real estate taxes | 2,345 | 2,899 |
General and administrative costs | 4,426 | 5,129 |
Depreciation and amortization | 6,659 | 7,945 |
Impairment charge | 5,000 | |
Total expenses | 56,416 | 55,212 |
Interest expense | (9,657) | (6,686) |
Gain on forgiveness of debt | 3,791 | |
Gain on sale of investment property | 449 | 8,524 |
Other income/(expense), net | 336 | (148) |
Income from investments in unconsolidated affiliated entities | 32 | 3,358 |
Net (loss)/income | (11,624) | 8,888 |
Less: net loss/(income) attributable to noncontrolling interests | 123 | (45) |
Net (loss)/income applicable to Company’s common shares | $ (11,501) | $ 8,843 |
Net (loss)/income per Company's common share, basic | $ (0.67) | $ 0.51 |
Net (loss)/income per Company's common share, diluted | $ (0.67) | $ 0.51 |
Weighted average number of common shares outstanding, basic | 17,077 | 17,229 |
Weighted average number of common shares outstanding, diluted | 17,077 | 17,229 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Income Statement [Abstract] | ||
Net (loss)/income | $ (11,624) | $ 8,888 |
Other comprehensive (loss)/income: | ||
Holding (loss)/gain on available for sale securities | (7) | 7 |
Other comprehensive (loss)/income | (7) | 7 |
Comprehensive (loss)/income | (11,631) | 8,895 |
Less: Comprehensive loss/(income) attributable to noncontrolling interests | 123 | (45) |
Comprehensive (loss)/income attributable to the Company’s common shares | $ (11,508) | $ 8,850 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDER'S EQUITY - USD ($) shares in Thousands, $ in Thousands | Common Stock [Member] | Additional Paid-in Capital [Member] | AOCI Attributable to Parent [Member] | Retained Earnings [Member] | Noncontrolling Interest [Member] | Total | |
Beginning balance, value at Dec. 31, 2021 | $ 173 | $ 146,308 | $ (46,506) | $ 11,493 | $ 111,468 | ||
Beginning balance, shares at Dec. 31, 2021 | 17,331 | ||||||
Net loss | 8,843 | 45 | 8,888 | ||||
Other comprehensive loss | 7 | 7 | |||||
Acquisition of non-controlling interest in a subsidiary | 74 | (94) | (20) | ||||
Distributions paid to noncontrolling interests | (107) | (107) | |||||
Redemption, cancellation and tender of shares | $ (2) | (1,411) | (1,413) | ||||
Redemption and cancellation of shares (in shares) | (159) | ||||||
Ending balance, value at Dec. 31, 2022 | $ 171 | 144,971 | 7 | (37,663) | 11,337 | 118,823 | |
Ending balance, shares at Dec. 31, 2022 | 17,172 | ||||||
Net loss | (11,501) | (123) | (11,624) | ||||
Other comprehensive loss | (7) | (7) | |||||
Contributions of noncontrolling interests | 68 | 68 | |||||
Distributions paid to noncontrolling interests | (273) | (273) | |||||
Redemption, cancellation and tender of shares | $ (2) | (1,752) | (1,754) | ||||
Redemption and cancellation of shares (in shares) | (170) | ||||||
Distributions declared | [1] | (5,120) | (5,120) | ||||
Ending balance, value at Dec. 31, 2023 | $ 169 | $ 143,219 | $ (54,284) | $ 11,009 | $ 100,113 | ||
Ending balance, shares at Dec. 31, 2023 | 17,002 | ||||||
[1]Distributions per share were $0.30. |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net (loss)/income | $ (11,624) | $ 8,888 |
Adjustments to reconcile net (loss)/income to net cash provide by operating activities: | ||
Depreciation and amortization | 6,659 | 7,945 |
Amortization of deferred financing costs | 396 | 328 |
Impairment charge | 5,000 | |
Gain on sale of investment property | (449) | (8,524) |
Unrealized (gain)/loss on marketable equity securities | (25) | 380 |
Gain on forgiveness of debt | (3,791) | |
Income from investments in unconsolidated affiliated entities | (32) | (3,358) |
Other non-cash adjustments | 302 | 486 |
Changes in assets and liabilities: | ||
Decrease/(increase) in accounts receivable and other assets | 1,307 | (1,508) |
(Decrease)/increase in accounts payable and other accrued expenses | (778) | 1,499 |
Decrease in due to related party | (102) | (82) |
Cash provided by operating activities | 654 | 2,263 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchase of investment property | (1,056) | (843) |
Purchase of noncontrolling interest in a subsidiary | (20) | |
Purchase of marketable securities | (8,511) | (887) |
Proceeds from sale of marketable securities | 3,436 | 3,015 |
Proceeds from sale of investment property, net of closing costs | 26,803 | 36,744 |
Contributions to unconsolidated affiliated entities | (445) | |
Distributions from unconsolidated affiliated entities | 855 | 7,523 |
Cash provided by investing activities | 21,082 | 45,532 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Payments on mortgages payable | (118,485) | (17,979) |
Payments on margin loan, net | (2,292) | |
Payment of loan fees and expenses | (1,090) | (397) |
Proceeds received from mortgages payable | 101,818 | |
Redemption, cancellation and tender of common shares | (1,754) | (1,413) |
Distributions to common stockholders | (3,845) | |
Contributions from noncontrolling interests | 68 | |
Distributions to noncontrolling interests | (273) | (107) |
Cash used in financing activities | (23,561) | (22,188) |
Change in cash, cash equivalents and restricted cash | (1,825) | 25,607 |
Cash, cash equivalents and restricted cash, beginning of year | 42,566 | 16,959 |
Cash, cash equivalents and restricted cash, end of year | $ 40,741 | $ 42,566 |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Pay vs Performance Disclosure [Table] | ||
Net Income (Loss) Attributable to Parent | $ (11,501) | $ 8,843 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Dec. 31, 2023 | |
Insider Trading Arrangements [Line Items] | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Business and Structure
Business and Structure | 12 Months Ended |
Dec. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business and Structure | 1. Business and Structure Lightstone Value Plus REIT II, Inc. (“Lightstone REIT II”), is a Maryland corporation formed on April 28, 2008, which elected to qualify as a real estate investment trust (“REIT”) for United States (the “U.S.”) federal income tax purposes beginning with the taxable year ended December 31, 2009. Lightstone REIT II is structured as an umbrella partnership REIT, or UPREIT, and substantially all of its current and future business will be conducted through Lightstone Value Plus REIT II LP, a Delaware limited partnership (the “Operating Partnership”). As of December 31, 2023, Lightstone REIT II held an approximately 99% Lightstone REIT II and the Operating Partnership and its subsidiaries are collectively referred to as the “Company” and the use of “we,” “our,” “us” or similar pronouns in these consolidated financial statements refers to Lightstone REIT II, its Operating Partnership or the Company as required by the context in which such pronoun is used. Through the Operating Partnership, the Company owns and operates commercial properties and makes real estate-related investments. Since its inception, the Company has primarily acquired and operated commercial hospitality properties, principally consisting of limited service-hotels all located in the U.S. Although the Company has historically acquired hotels, it has and may continue to purchase other types of real estate. Assets other than hotels may include, without limitation, office buildings, shopping centers, business and industrial parks, manufacturing facilities, single-tenant properties, multifamily properties, student housing properties, warehouses and distribution facilities and medical/life sciences office buildings. The Company’s real estate investments are held by it alone or jointly with other parties. In addition, the Company may invest up to 20% of its net assets in collateralized debt obligations, commercial mortgage-backed securities (“CMBS”) and mortgage and mezzanine loans secured, directly or indirectly, by the same types of properties which it may acquire directly. Although most of its investments are these types, the Company may invest in whatever types of real estate or real estate-related investments that it believes are in its best interests. The Company evaluates all of its real estate investments as one operating segment. The Company currently intends to hold its investments until such time as it determines that a sale or other disposition appears to be advantageous to achieve its investment objectives or until it appears that the objectives will not be met. As of December 31, 2023, the Company (i) majority owned and consolidated the operating results and financial condition of 10 limited service hotels containing a total of 1,352 rooms, (ii) held an unconsolidated 48.6% The Brownmill Joint Venture owns Browntown Shopping Center, located in Old Bridge, New Jersey, and Millburn Mall, located in Vauxhaull, New Jersey. The Hilton Garden Inn Joint Venture owns a 183-room, limited service hotel (the “Hilton Garden Inn – Long Island City) located in the Long Island City neighborhood in the Queens borough of New York City. Both the Brownmill Joint Venture and the Hilton Garden Inn Joint Venture are between the Company and related parties. As of December 31, 2023, five of the Company’s consolidated limited service hotels are held in LVP Holdco JV LLC (the “Hotel Joint Venture”), a joint venture formed between the Company and Lightstone Value Plus REIT I, Inc. (“Lightstone REIT I”), a related party REIT also sponsored by The Lightstone Group, LLC (the “Sponsor”). The Company and Lightstone REIT I have 97.5% and 2.5% membership interests in the Hotel Joint Venture, respectively. Additionally, as of December 31, 2023, one of the Company’s consolidated hotels also has ownership interests held by unrelated minority owners. The membership interests of Lightstone REIT I and the unrelated minority owners are accounted for as noncontrolling interests. The Company’s advisor is Lightstone Value Plus REIT II LLC (the “Advisor”), which is majority owned by David Lichtenstein. On May 20, 2008, the Advisor contributed $ 2 200 20,000 200 10.00 $100,000 17.7 The Company has no employees. The Company is dependent on the Advisor and certain affiliates of the Sponsor for performing a full range of services that are essential to it, including asset management, property management (excluding our hospitality properties, which are each managed by an unrelated third party property manager) and acquisition, disposition and financing activities, and other general administrative responsibilities, such as tax, accounting, legal, information technology and investor relations services. If the Advisor and certain affiliates of the Sponsor are unable to provide these services to the Company, it would be required to provide the services itself or obtain the services from other parties. The Company’s Common Shares are not currently listed on a national securities exchange. The Company may seek to list its Common Shares for trading on a national securities exchange only if a majority of its independent directors believe listing would be in the best interest of its stockholders. The Company does not intend to list its shares at this time. The Company does not anticipate that there would be any active market for its Common Shares until they are listed for trading. On January 17, 2023, the Company’s stockholders approved an amendment and restatement to the Company’s charter pursuant to which the Company is no longer required to either (a) amend its charter to extend the deadline to begin the process of achieving a liquidity event, or (b) hold a stockholders meeting to vote on a proposal for an orderly liquidation of its portfolio. Noncontrolling Interests – Partners of the Operating Partnership Limited Partner On May 20, 2008, the Advisor contributed $ 2 200 Associate General Partner In connection with the Company’s Offerings, the Sponsor and its wholly owned subsidiary, Lightstone Holdings LLC (“LGH”), contributed (i) cash of $ 12.9 48.6% 4.8 177 100,000 17.7 As the indirect majority owner of the Associate General Partner, Mr. Lichtenstein is the beneficial owner of a 99% interest in such Subordinated Profits Interests and thus receives an indirect benefit from any distributions made in respect thereof. These Subordinated Profits Interests may entitle the Associate General Partner to a portion of any regular distributions that the Company makes to its stockholders, but only after its stockholders have received a stated preferred return. However, there have been no distributions declared on the Subordinated Profits Interests for any periods after December 31, 2019. Since the Company’s inception through December 31, 2023, the cumulative distributions declared and paid on the Subordinated Profits Interests were $7.9 million. Any future distributions on the Subordinated Profits Interests will always be subordinated until stockholders receive a stated preferred return. The Subordinated Profits Interests may also entitle the Associate General Partner to a portion of any liquidating distributions made by the Operating Partnership. The value of such distributions will depend upon the net proceeds available for distribution upon the liquidation of the Company and, therefore, cannot be determined at the present time. Liquidating distributions to the Associate General Partner will always be subordinated until stockholders receive a distribution equal to their initial investment plus a stated preferred return. Other Noncontrolling Interests in Consolidated Subsidiaries Other noncontrolling interests consist of the (i) membership interest in the Joint Venture held by Lightstone REIT I and (ii) membership interests held by minority owners in one of the Company’s hotels. Related Parties The Company’s Sponsor, Advisor and their affiliates, including the Associate General Partner and LGH, are related parties of the Company as well as the other public REITs also sponsored and/or advised by these entities. Pursuant to the terms of various agreements, certain of these entities are entitled to compensation and reimbursement for services and costs incurred related to the investment, development, management and disposition of the Company’s assets. The compensation is generally based on the cost of acquired properties/investments and the annual revenue earned from such properties/investments, and other such fees and expense reimbursements as outlined in each of the respective agreements. See Notes 4 and 8 for additional information. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Principles of Consolidation and Basis of Presentation The consolidated financial statements include the accounts of Lightstone REIT II and the Operating Partnership and its subsidiaries (over which Lightstone REIT II exercises financial and operating control). As of December 31, 2023, Lightstone REIT II had a 99% The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses during a reporting period. The most significant assumptions and estimates relate to the valuation of investment property and investments in other unconsolidated real estate entities and depreciable lives of long-lived assets. Application of these assumptions requires the exercise of judgment as to future uncertainties and, as a result, actual results could differ from these estimates. Investments in other unconsolidated real estate entities where the Company has the ability to exercise significant influence, but does not exercise financial and operating control and is not considered to be the primary beneficiary are accounted for using the equity method. Cash and Cash Equivalents and Restricted Cash The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. As required by the Company’s lenders, restricted cash is held in escrow accounts for anticipated capital expenditures, real estate taxes, debt service payments, insurance and other reserves for certain of our properties. Capital reserves are typically utilized for non-operating expenses such as major capital expenditures. Alternatively, a lender may require its own formula for an escrow of capital reserves. The following is a summary of the Company’s cash, cash equivalents, and restricted cash total as presented in our statements of cash flows for the periods presented: Summary of supplemental cash flow information Year Ended 2023 2022 Cash and cash equivalents $ 36,192 $ 42,233 Restricted cash 4,549 333 Total cash, cash equivalents and restricted cash $ 40,741 $ 42,566 Supplemental disclosure of cash flow information: Cash paid for interest $ 7,649 $ 6,107 Cash paid for taxes $ 1,402 $ 212 Distributions declared but not paid $ 1,275 $ - Holding loss on available for sale securities $ 7 $ 7 Marketable Securities Marketable securities consist of equity and debt securities that are designated as available-for-sale. The Company’s marketable debt securities consist solely of U.S. Treasury Bills, are recorded at fair value and unrealized holding gains or losses are reported as a component of accumulated other comprehensive income. The Company’s marketable equity securities are recorded at fair value and unrealized holding gains and losses are recognized on the consolidated statements of operations. Realized gains or losses resulting from the sale of these securities are determined based on the specific identification of the securities sold. Revenue Recognition Revenues consist of amounts derived from hotel operations, including occupied hotel rooms and sales of food, beverage and other ancillary services and are presented on a disaggregated basis below. Revenues are recorded net of any sales or occupancy tax collected from our guests. Room revenue is generated through contracts with customers whereby the customers agree to pay a daily rate for right to use a hotel room. The Company’s contract performance obligations are fulfilled at the end of the day that the customer is provided the room and revenue is recognized daily at the contract rate. Payment from the customer is secured at the end of the contract upon check-out by the customer from our hotel. The Company participates in frequent guest programs sponsored by the brand owners of our hotels whereby the brand owner allows guests to earn loyalty points during their hotel stay. The Company recognizes revenue at the amount earned that it will receive from the brand owner when a guest redeems their loyalty points by staying at one of the Company’s hotels. Revenue from food, beverage and other ancillary services is generated when a customer chooses to purchase goods or services separately from a hotel room and revenue is recognized when these goods or services are provided to the customer and the Company’s contract performance obligations have been fulfilled. Some contracts for rooms, food, beverage or other services require an upfront deposit which is recorded as deferred revenues (or contract liabilities) and recognized once the performance obligations are satisfied. The contract liabilities are not significant. The Company notes no significant judgments regarding the recognition of room, food and beverage or other revenues. The following table represents the total revenues from hotel operations on a disaggregated basis: Schedule of total revenues from hotel operations on a disaggregated basis For the 2023 2022 Revenues Room $ 50,815 $ 52,744 Food, beverage and other 2,817 2,517 Total revenues $ 53,632 $ 55,261 Accounts Receivable Accounts receivable primarily represents receivables from hotel guests who occupy hotel rooms and utilize hotel services. The Company maintains an allowance for doubtful accounts sufficient to cover estimated potential credit losses. Investment in Real Estate Accounting for Asset Acquisitions When the Company makes an investment in real estate assets, the cost of real estate assets acquired in an asset acquisition are allocated to the acquired tangible assets, consisting of land, building and improvements, furniture and fixtures and identified intangible assets and liabilities, consisting of the value of above-market and below-market leases, acquired in-place leases, and the value of tenant relationships, based in each case on their relative fair values, at the date of acquisition, based on evaluation of information and estimates available at that date, including independent appraisals that may be obtained in connection with the acquisition or financing of the respective property and other relevant market data. Fees incurred related to asset acquisitions are capitalized as part of the cost of the investment. Carrying Value of Assets The amounts capitalized as a result of periodic improvements and additions to real estate property, when applicable, and the periods over which the assets are depreciated or amortized, are determined based on the application of accounting standards that may require estimates as to fair value and the allocation of various costs to the individual assets. Differences in the amount attributed to the assets can be significant based upon the assumptions made in calculating these estimates. Impairment Evaluation The Company evaluates its investments in real estate assets for potential impairment whenever events or changes in circumstances indicate that the undiscounted projected cash flows are less than the carrying amount for a particular property. The Company evaluates the recoverability of its investments in real estate assets at the lowest identifiable level, which is primarily at the individual property level. No single indicator would necessarily result in the Company preparing an estimate to determine if an individual property’s future undiscounted cash flows are less than its carrying value. The Company uses judgment to determine if the severity of any single indicator, or the fact that there are a number of indicators of less severity that when combined, would result in an indication that a property requires an estimate of the undiscounted cash flows to determine if an impairment has occurred. Relevant facts and circumstances include, among others, significant underperformance relative to historical or projected future operating results and significant negative industry, geographic or economic trends. The undiscounted projected cash flows used for the impairment analysis are subjective and require the Company to use its judgment and the determination of estimated fair value are based on the Company’s plans for the respective assets and the Company’s views of market and economic conditions. The estimates consider matters such as future operating income, market and other applicable trends and residual value, as well as the effects of demand, competition, and recent sales data for comparable properties. An impairment loss is recognized only if the carrying amount of a property is not recoverable and exceeds its fair value. The Company recorded a $ 5.0 no Depreciation and Amortization Depreciation expense is computed based on the straight-line method over the estimated useful life of the applicable real estate asset. The Company generally uses estimated useful lives of up to 39 5 10 Deferred Costs Deferred financing costs are recorded at cost and consist of loan fees and other costs incurred in issuing debt. Amortization of deferred financing costs is computed using a method that approximates the effective interest method over the term of the related debt and is included in interest expense in the consolidated statements of operations. Unamortized deferred financing costs are included as a direct deduction from the related debt in the consolidated balance sheets. Investments in Unconsolidated Entities The Company evaluates all investments in other entities for consolidation. The Company considers its percentage interest in the joint venture, evaluation of control and whether a variable interest entity exists when determining whether or not the investment qualifies for consolidation or if it should be accounted for as an unconsolidated investment under the equity method of accounting. If an investment qualifies for the equity method of accounting, the Company’s investment is recorded initially at cost, and subsequently adjusted for equity earnings and cash contributions and distributions. The earnings of an unconsolidated investment are allocated to its investors in accordance with the provisions of the operating agreement of the entity. The allocation provisions in these agreements may differ from the ownership interest held by each investor. Differences, if any, between the carrying amount of the Company’s investment in the respective joint venture and our share of the underlying equity of such unconsolidated entity are amortized over the respective lives of the underlying assets as applicable. These items are reported as a single line item in the statements of operations as earnings from investments in unconsolidated entities. The Company reviews investments in unconsolidated entities for impairment in value whenever events or changes in circumstances indicate that the carrying amount of such investment may not be recoverable. An investment in an unconsolidated entity is impaired only if management’s estimate of the fair value of the investment is less than the carrying value of the investment, and such decline in value is deemed to be other than temporary. The ultimate realization of our investment in partially owned entities is dependent on a number of factors including the performance of that entity and market conditions. If the Company determines that a decline in the value of a partially owned entity is other than temporary, it will record an impairment charge. Tax Status and Income Taxes The Company elected to be taxed and qualify as a REIT commencing with the taxable year ended December 31, 2009. As a REIT, the Company generally will not be subject to U.S. federal income tax on its net taxable income that it distributes currently to its stockholders. To maintain its REIT qualification under the Internal Revenue Code of 1986, as amended, or the Code, the Company must meet a number of organizational and operational requirements, including a requirement that it annually distribute to its stockholders at least 90% To maintain its qualification as a REIT, the Company engages in certain activities through a taxable REIT subsidiary (“TRS”), including when it acquires a hotel it usually establishes a new TRS and enters into an operating lease agreement for the hotel. As such, the Company is subject to U.S. federal and state income taxes and franchise taxes from these activities. The Company’s income tax benefits and expense are included in other income/(expense), net on its consolidated statements of operations. During the years ended December 31, 2023 and 2022, the Company recorded income tax expense of $ 1.6 0.2 As of December 31, 2023 and 2022, the Company had no Fair Value of Financial Instruments The carrying amounts of cash and cash equivalents, restricted cash, accounts receivable and other assets, accounts payable and other accrued expenses, distribution payable and due to related party approximated their fair values as of December 31, 2023 and 2022 because of the short maturity of these instruments. As of December 31, 2023 and 2022, the estimated fair value our mortgages payable approximated their carrying values because they bear interest at a floating rate. Concentration of Risk At December 31, 2023 and 2022, the Company had cash deposited in certain financial institutions in excess of U.S. federally insured levels. The Company regularly monitors the financial stability of these financial institutions and believes that it is not exposed to any significant credit risk with respect to its cash and cash equivalents or restricted cash. Basic and Diluted Net Earnings per Common Share The Company had no potentially dilutive securities outstanding during the periods presented. Accordingly, earnings per share is calculated by dividing net income attributable to common shareholders by the weighted-average number of shares of Common Shares outstanding during the applicable period. Current Environment The Company’s operating results and financial condition are substantially impacted by the overall health of local, U.S. national and global economies and may be influenced by market and other challenges. Additionally, its business and financial performance may be adversely affected by current and future economic and other conditions; including, but not limited to, availability or terms of financings, financial markets volatility and banking failures, political upheaval or uncertainty, natural and man-made disasters, terrorism and acts of war, unfavorable changes in laws and regulations, outbreaks of contagious diseases, cybercrime, loss of key relationships, inflation and recession. The Company’s overall performance depends in part on worldwide economic and geopolitical conditions and their impacts on consumer behavior. Worsening economic conditions, increases in costs due to inflation, higher interest rates, certain labor and supply chain challenges and other changes in economic conditions may adversely affect the Company’s results of operations and financial performance. New Accounting Pronouncements In June 2016, the Financial Accounting Standards Board, or FASB, issued an accounting standards update, “Financial Instruments-Credit Losses-Measurement of Credit Losses on Financial Instruments,” which changes how entities measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. The updated standard replaces the current “incurred loss” approach with an “expected loss” model for instruments measured at amortized cost. For trade and other receivables and held to maturity debt securities, entities are required to use a new forward looking expected loss model that generally will result in the earlier recognition of allowances for losses. The Company has adopted this standard effective January 1, 2023, noting that it did not have a material impact on its consolidated financial statements. In November 2023, the FASB issued an accounting standards update which is intended to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant expenses. The amendments will require entities to disclose significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”) and included within segment profit and loss, as well as the title and position of the CODM. The amendments are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. The Company is currently evaluating the guidance and the impact it may have on its consolidated financial statements. In December 2023, the FASB issued an accounting standards update which includes amendments that further enhance income tax disclosures, primarily through standardization and disaggregation of rate reconciliation categories and income taxes paid by jurisdiction. This update is effective for annual periods beginning after December 15, 2024. The Company is currently evaluating the guidance and the impact it may have on its consolidated financial statements. The Company has reviewed and determined that other recently issued accounting pronouncements will not have a material impact on its financial position, results of operations and cash flows, or do not apply to its current operations. |
Disposition Activities
Disposition Activities | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Disposition Activities | 3. Disposition Activities Impairment Charge and Disposition of Florida Hotels On May 8, 2023, the Hotel Joint Venture, which the Company majority owns and consolidates, through its subsidiaries (collectively, the “Sellers”), and Vista Acquisitions Inc. (the “Florida Hotels Buyer”), an unaffiliated third party, entered into a purchase and sale agreement, as amended, (the “Florida Hotels Agreement”) pursuant to which the Sellers would dispose of (i) a 126-room limited service hotel located in Miami, Florida (the “Hampton Inn - Miami”), and (ii) a 104-room limited service hotel located in Fort Lauderdale, Florida (the “Hampton Inn & Suites - Fort Lauderdale” and collectively, the “Florida Hotels”) to the Florida Hotels Buyer for an aggregate contractual sales price of $ 28.0 During the second quarter of 2023, the Company recorded a non-cash impairment charge of $ 5.0 27.1 On July 18, 2023 and July 21, 2023, the Sellers completed the disposition of the Florida Hotels to the Florida Hotels Buyer pursuant to the terms of the Florida Hotels Agreement. In connection with these transactions, the Sellers used an aggregate of $ 16.7 Additionally, as a result of the sale of the Florida Hotels, the number of remaining hotels owned by the Hotel Joint Venture was reduced to five. Additionally, during the first quarter of 2023 the Company recognized a gain on the sale of investment property of $ 0.3 Disposition of the Courtyard – Paso Robles On March 22, 2022, the Company completed the disposition of a 130-room limited service hotel located in Paso Robles, California (the “Courtyard – Paso Robles”) to an unaffiliated third party for a contractual sales price of $ 32.3 13.4 14.1 17.8 7.7 Disposition of the TownePlace Suites - Little Rock On July 14, 2022, the Company completed the disposition of a 92-room limited service hotel located in Little Rock, Arkansas (the “TownePlace Suites - Little Rock”) to an unaffiliated third party for a contractual sales price of $ 5.9 4.6 1.2 0.8 The dispositions of the Florida Hotels, the Courtyard – Paso Robles and the TownePlace Suites - Little Rock did not qualify to be reported as discontinued operations since these dispositions did not represent a strategic shift that had a major effect on the Company’s operations and financial results. Accordingly, the operating results of the Florida Hotels, the Courtyard – Paso Robles and the TownePlace Suites - Little Rock are reflected in the Company’s results from continuing operations for all periods presented through their respective dates of disposition. |
Investments in Unconsolidated A
Investments in Unconsolidated Affiliated Entities | 12 Months Ended |
Dec. 31, 2023 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investments in Unconsolidated Affiliated Entities | 4. Investments in Unconsolidated Affiliated Entities The entities listed below are partially owned by the Company. The Company accounts for these investments under the equity method of accounting as the Company exercises significant influence, but does not exercise financial and operating control over these entities. A summary of the Company’s investments in unconsolidated affiliated entities is as follows: Summary of investments in unconsolidated entities As of Entity Date of Ownership Ownership % December 31, December 31, Brownmill Joint Venture Various 48.6 % $ 4,025 $ 4,204 Hilton Garden Inn Joint Venture March 27, 2018 50.0 % 9,390 9,589 Total investments in unconsolidated affiliated real estate entities $ 13,415 $ 13,793 Brownmill Joint Venture During 2010 through 2012, the Company entered into various contribution agreements with LGH, a wholly owned subsidiary of the Sponsor and a related party, pursuant to which LGH contributed to the Operating Partnership an aggregate 48.6% membership interest in the Brownmill Joint Venture in exchange for it issuing an aggregate of 48 units of Subordinated Profits Interests to the Associate General Partner at $ 100,000 The Company’s 48.6% 0.6 5.6 The Brownmill Joint Venture owns two retail properties known as Browntown Shopping Center, located in Old Bridge, New Jersey, and Millburn Mall, located in Vauxhaull, New Jersey. Brownmill Joint Venture Financial Information The Company’s carrying value of its interest in the Brownmill Joint Venture differs from its share of member’s equity reported in the condensed balance sheets of the Brownmill Joint Venture because the basis of the Company’s investment is in excess of the historical net book value of the Brownmill Joint Venture. The Company’s additional basis, which has been allocated to depreciable assets, is being recognized on a straight-line basis over the estimated useful lives of the appropriate assets. The following table represents the condensed statements of operations for the Brownmill Joint Venture: Schedule of condensed income statements For the For the Revenues $ 3,754 $ 4,139 Property operating expenses 1,433 1,792 Depreciation and amortization 750 823 Operating income 1,571 1,524 Gain on disposition of real estate (1) - 5,816 Interest expense and other, net (621 ) (563 ) Net income $ 950 $ 6,777 Company’s share of earnings (48.6%) $ 462 $ 3,293 Additional depreciation and amortization expense (2) (83 ) (316 ) Company’s earnings from investment $ 379 $ 2,977 Notes (1) During the year ended December 31, 2022, the Brownmill Joint Venture recognized a gain on disposition of real estate of $5.8 million in connection with the sale of an outparcel of land and the buildings and improvements thereon at Browntown Shopping Center for a contractual sales price of $10.5 million on August 12, 2022. (2) Additional depreciation and amortization expense is attributable to the difference between the Company’s cost of its interest in the Brownmill Joint Venture and the amount of the underlying equity in net assets of the Brownmill Joint Venture. The following table represents the condensed balance sheets for the Brownmill Joint Venture: Schedule of condensed balance sheets As of As of Investment properties, net $ 12,423 $ 12,860 Cash and restricted cash 1,598 1,422 Other assets 1,153 1,283 Total assets $ 15,174 $ 15,565 Mortgage payable $ 13,075 $ 13,341 Other liabilities 736 662 Members’ capital 1,363 1,562 Total liabilities and members’ capital $ 15,174 $ 15,565 Hilton Garden Inn Joint Venture On March 27, 2018, the Company and Lightstone Value Plus REIT III, Inc. (“Lightstone REIT III”), a related party REIT also sponsored by the Company’s Sponsor, acquired, through the newly formed Hilton Garden Inn Joint Venture, the Hilton Garden Inn - Long Island City from an unrelated third party, for aggregate consideration of $ 60.0 25.0 35.0 12.9 50% Except as discussed below, the Hilton Garden Inn Mortgage bore interest at LIBOR plus 3.15%, subject to a 5.03% floor On June 2, 2020, the Hilton Garden Inn Mortgage was amended to provide for the deferral of six monthly debt service payments aggregating $ 0.9 On March 27, 2023, the Hilton Garden Inn Joint Venture and the lender amended the Hilton Garden Inn Mortgage to extend the maturity date for 90 days, through June 25, 2023, to provide additional time to finalize the terms of a long-term extension. Subsequently, on May 31, 2023, the Hilton Garden Inn Mortgage was further amended to provide for (i) an extension of the maturity date for an additional five years, (ii) the interest rate to be adjusted to SOFR plus 3.25% May 31, 2028 3.0 Additionally, the Hilton Garden Inn Joint Venture is required to fund an aggregate of $1.3 million, through monthly payments of $37 from May 31, 2023 through June 1, 2026, into a cash collateral reserve account which may be drawn upon for specified capital expenditures. The Company and Lightstone REIT III each have a 50% co-managing membership interest in the Hilton Garden Inn Joint Venture. The Company accounts for its membership interest in the Hilton Garden Inn Joint Venture in accordance with the equity method of accounting because it exerts significant influence over but does not control the Hilton Garden Inn Joint Venture. All capital contributions and distributions of earnings from the Hilton Garden Inn Joint Venture are made on a pro rata basis in proportion to each member’s equity interest percentage. Any distributions in excess of earnings from the Hilton Garden Inn Joint Venture are made to the members pursuant to the terms of the Hilton Garden Inn Joint Venture’s operating agreement. As of December 31, 2023, the Hilton Garden Inn Joint Venture was in compliance with all of its financial covenants. During the year ended December 31, 2023, the Company made aggregate capital contributions to the Hilton Garden Inn Joint Venture of $ 0.4 0.3 2.0 Hilton Garden Inn Joint Venture Financial Information The following table represents the condensed statements of operations for the Hilton Garden Inn Joint Venture: Schedule of condensed income statements For the For the Revenues $ 12,417 $ 11,353 Property operating expenses 7,571 6,646 General and administrative costs 139 21 Depreciation and amortization 2,429 2,443 Operating income 2,278 2,243 Interest expense and other, net (2,972 ) (1,997 ) Gain on forgiveness of debt - 516 Net (loss)/income $ (694 ) $ 762 Company’s share of net (loss)/income (50.0%) $ (347 ) $ 381 The following table represents the condensed balance sheets for the Hilton Garden Inn Joint Venture: Schedule of condensed balance sheets As of As of Investment property, net $ 48,001 $ 50,254 Cash 1,741 1,231 Other assets 1,816 1,276 Total assets $ 51,558 $ 52,761 Mortgage payable, net $ 32,273 $ 32,233 Other liabilities 1,075 1,920 Members’ capital 18,210 18,608 Total liabilities and members’ capital $ 51,558 $ 52,761 |
Marketable Securities, Fair Val
Marketable Securities, Fair Value Measurements and Margin Loan | 12 Months Ended |
Dec. 31, 2023 | |
Marketable Securities Fair Value Measurements And Margin Loan | |
Marketable Securities, Fair Value Measurements and Margin Loan | 5. Marketable Securities, Fair Value Measurements and Margin Loan Marketable Securities The following is a summary of the Company’s available for sale securities as of the dates indicated: Summary of available for sale securities As of December 31, 2023 Adjusted Gross Gross Fair Marketable Securities Equity Securities $ 9,582 $ 37 $ (332 ) $ 9,287 As of December 31, 2022 Adjusted Gross Gross Fair Value Marketable Securities Equity securities $ 3,620 $ - $ (321 ) $ 3,299 Debt securities U.S. Treasury Bills 887 7 - 894 Total $ 4,507 $ 7 $ (321 ) $ 4,193 Fair Value Measurements Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The standard describes a fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value: ● Level 1 – Quoted prices in active markets for identical assets or liabilities. ● Level 2 – Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. ● Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. As of December 31, 2022, the Company’s U.S. Treasury Bills were classified as Level 1 assets. As of December 31, 2023 and 2022, the Company’s equity securities were classified as Level 2 assets. There were no transfers between the level classifications during the years ended December 31, 2023 and 2022. The fair values of the Company’s U.S. Treasury Bills were measured using quoted prices in active markets for identical assets and equity securities are measured using readily available quoted prices for these securities; however, the markets for these securities are not active. Nonrecurring Fair Value Measurements During the second quarter of 2023 the Company recorded a non-cash impairment charge of $ 5.0 27.1 The Company did not have any other significant financial assets or liabilities, which would require revised valuations that are recognized at fair value. Margin Loan The Company has access to a margin loan from a financial institution that holds custody of certain of the Company’s marketable securities. The margin loan is collateralized by the marketable securities in the Company’s account. The amounts available to the Company under the margin loan are at the discretion of the financial institution and not limited to the amount of collateral in its account. No SOFR plus 0.85% |
Mortgages Payable, Net
Mortgages Payable, Net | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Mortgages Payable, Net | 6. Mortgages Payable, Net Mortgages payable, net consisted of the following: Schedule of mortgages payable Weighted Description Interest as of Maturity Amount Due As of As of Revolving Credit Facility SOFR + 3.45% 8.38% September 2026 $ 101,818 $ 101,818 $ - Revolving Loan AMERIBOR plus 3.15% Repaid in full - - 118,485 Total mortgages payable 8.38% $ 101,818 101,818 118,485 Less: Deferred financing costs (998 ) (305 ) Total mortgages payable, net $ 100,820 $ 118,180 SOFR as of December 31, 2023 was 5.35% 4.64% Revolving Credit Facility On October 23, 2023, the Company entered into a loan agreement with a financial institution providing for a non-recourse revolving credit facility (the “Revolving Credit Facility”) of up to $106.0 million. The Company received an initial advance of $101.8 million under the Revolving Credit Facility and designated 10 hotel properties as collateral. The Revolving Credit Facility bears interest at SOFR plus 3.45%, subject to a 6.45% floor, with an initial scheduled maturity of September 15, 2026, subject to two, one-year extension options at the sole discretion of the lender, and provides for monthly interest-only payments with the unpaid principal balance due at maturity. The Revolving Credit Facility provides for borrowings up to 65% The Company did not meet certain of the financial debt covenants under the Revolving Credit Facility as of December 31, 2023 and the lender has the option of requiring it to make a principal paydown of $1.9 million. The Company used the initial advance from the Revolving Credit Facility to repay in full the Revolving Loan with the same financial institution, which was also secured by the same 10 hotel properties. The scheduled maturity of the Revolving Loan had previously been extended from September 15, 2023 until October 23, 2023 In connection with any disposition of any hotel pledged under the Revolving Loan, the Company was required to make a principal paydown on its outstanding balance in exchange for the hotel’s release from the designated collateral pool. In connection with the disposition of the TownePlace Suites – Little Rock on July 14, 2022, a required principal paydown of $ 4.6 123.1 118.5 16.7 118.5 101.8 As of December 31, 2023, the outstanding principal balance of the Revolving Credit Facility was $101.8 million and its interest rate was 8.38%. Additionally, all 10 of the Company’s majority owned and consolidated hotel properties were pledged as collateral and no additional borrowings were available under the Revolving Credit Facility as of December 31, 2023. Pursuant to the Company’s loan agreements, escrows in the amount of $4.5 million and $0.3 million were held in restricted cash accounts as of December 31, 2023 and 2022, respectively. Such escrows will be released in accordance with the applicable loan agreements for payments of real estate taxes, debt service payments, insurance and capital improvement transactions, as required. |
Stockholder_s Equity
Stockholder’s Equity | 12 Months Ended |
Dec. 31, 2023 | |
Equity [Abstract] | |
Stockholder’s Equity | 7. Stockholder’s Equity Preferred Shares Shares of preferred stock may be issued in the future in one or more series as authorized by the Company’s Board of Directors. Prior to the issuance of shares of any series, the Board of Directors is required by the Company’s charter to fix the number of shares to be included in each series and the terms, preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications and terms or conditions of redemption for each series. Because the Company’s Board of Directors has the power to establish the preferences, powers and rights of each series of preferred stock, it may provide the holders of any series of preferred stock with preferences, powers and rights, voting or otherwise, senior to the rights of holders of our Common Shares. The issuance of preferred stock could have the effect of delaying, deferring or preventing a change in control of the Company, including an extraordinary transaction (such as a merger, tender offer or sale of all or substantially all of our assets) that might provide a premium price for holders of the Company’s Common Shares. To date, the Company has had no outstanding preferred shares. Common Shares All of the Common Shares offered by the Company will be duly authorized, fully paid and nonassessable. Subject to the preferential rights of any other class or series of stock and to the provisions of its charter regarding the restriction on the ownership and transfer of shares of our stock, holders of the Company’s Common Shares will be entitled to receive distributions if authorized by the Board of Directors and to share ratably in the Company’s net proceeds available for distribution to the stockholders in the event of a liquidation, dissolution or winding-up. Each outstanding share of the Company’s Common Shares entitles the holder to one vote on all matters submitted to a vote of stockholders, including the election of directors. There is no cumulative voting in the election of directors, which means that the holders of a majority of the outstanding Common Shares can elect all of the directors then standing for election, and the holders of the remaining Common Shares will not be able to elect any directors. Holders of the Company’s Common Shares have no conversion, sinking fund, redemption or exchange rights, and have no preemptive rights to subscribe for any of its securities. Maryland law provides that a stockholder has appraisal rights in connection with some transactions. However, the Company’s charter provides that the holders of its stock do not have appraisal rights unless a majority of the Board of Directors determines that such rights shall apply. Shares of the Company’s Common Shares have equal dividend, distribution, liquidation and other rights. Under its charter, the Company cannot make certain material changes to its business form or operations without the approval of stockholders holding at least a majority of the shares of our stock entitled to vote on the matter. These include (1) amendment of its charter, (2) its liquidation or dissolution, (3) its reorganization, and (4) to the extent required under Maryland law, its merger, consolidation or the sale or other disposition of all or substantially all of its assets. Distributions on Common Shares There were no distributions declared or paid on the Company’s Common Shares for any periods during the year ended December 31, 2022. However on March 22, 2023, the Board of Directors began declaring regular quarterly distributions on our Common Shares at the pro rata equivalent of an annual distribution of $0.30 3% $10.00 5.1 On March 18, 2024, the Board of Directors authorized and the Company declared a Common Share distribution of $0.075 $0.30 3% $10.00 Future distributions declared, if any, will be at the discretion of the Board of Directors based on their analysis of the Company’s performance over the previous periods and expectations of performance for future periods. The Board of Directors will consider various factors in its determination, including but not limited to, the sources and availability of capital, revenues and other sources of income, operating and interest expenses and the Company’s ability to refinance near-term debt as well as the IRS’s annual distribution requirement that REITs distribute no less than 90% of their taxable income. The Company cannot assure that any future distributions will be made or that it will maintain any particular level of distributions that it has previously established or may establish. Tender Offer The Company commenced a tender offer on November 28, 2023, pursuant to which it offered to acquire up to 860,000 $6.00 5.2 520,141 3.1 SRP The Company’s share repurchase program (the “SRP”) may provide eligible stockholders with limited, interim liquidity by enabling them to sell their Common Shares back to the Company, subject to restrictions and applicable law. On March 19, 2020, the Board of Directors amended the SRP to remove stockholder notice requirements and also approved the suspension of all redemptions. Effective May 10, 2021, the Board of Directors reopened the SRP to allow, subject to various conditions as set forth below, for redemptions submitted in connection with a stockholder’s death or hardship and set the price for all such purchases to the Company’s current estimated net asset value per share of common stock, as determined by the Board of Directors and reported by the Company from time to time. Deaths that occurred subsequent to January 1, 2020 were eligible for consideration, subject to certain conditions. Beginning January 1, 2022, requests for redemptions in connection with a stockholder’s death must be submitted and received by the Company within one year of the stockholder’s date of death for consideration. On the above noted date, the Board of Directors established that on an annual basis, the Company would not redeem in excess of 0.5% In connection with the approval of the Tender Offer, on November 13, 2023, the Board of Directors approved the suspension of the SRP effective November 20, 2023. Pursuant to the terms of the SRP, while the SRP is suspended, the Company will not accept any requests for redemption and any such requests and all pending requests will not be honored or retained, but will be returned to the requestor. As a result of the termination of the Tender Offer on February 5, 2024, on March 18, 2024, the Board of Directors reinstated the SRP. For the year ended December 31, 2023, the Company repurchased 170,425 $10.05 158,885 $8.89 Noncontrolling Interests See Notes 1 and 8 for additional information on Noncontrolling Interests and the distribution rights related to the Subordinated Profits Interests, respectively. |
Related Party and Other Transac
Related Party and Other Transactions | 12 Months Ended |
Dec. 31, 2023 | |
Related Party Transactions [Abstract] | |
Related Party and Other Transactions | 8. Related Party and Other Transactions The Company’s Sponsor, Advisor and their affiliates, including the Associate General Partner and LGH, are related parties of the Company as well as other public REITs also sponsored and/or advised by these entities. Pursuant to the terms of various agreements, certain of these entities are entitled to compensation and reimbursement of costs incurred for services related to the investment, development, management and disposition of our assets. The compensation is generally based on the cost of acquired properties/investments and the annual revenue earned from such properties/investments, and other such fees and expense reimbursements as outlined in each of the respective agreements. The following table summarizes all the compensation and fees the Company paid or may pay to these related parties, including amounts to reimburse their costs in providing services. Additionally, the Sponsor and LGH have made contributions to the Operating Partnership in exchange for it issuing Subordinated Profits Interests in the Operating Partnership to the Associate General Partner that may entitle it to subordinated distributions as described in the table below. Fees Amount Acquisition Fee The Advisor is paid an acquisition fee equal to 0.95% of the gross contractual purchase price (including any mortgage assumed) of each property purchased. The Advisor is also be reimbursed for expenses that it incurs in connection with the purchase of a property. Property Management – Multifamily/Retail/ Hospitality Properties Either third party or affiliated property managers are paid a monthly management fee of up to 5% of the gross revenues from multifamily, hospitality and retail properties. The Company may pay the property manager a separate fee for (i) the development of (ii) one-time initial rent-up or (iii) leasing-up of newly constructed properties in an amount not to exceed the fee customarily charged in arm’s length transactions by others rendering similar services in the same geographic area for similar properties as determined by a survey of brokers and agents in such area. Property Management – Office/Industrial Properties The property managers are paid monthly property management and leasing fees of up to 4.5% of gross revenues from office and industrial properties. In addition, the Company may pay the property managers a separate fee for the one-time initial rent-up or leasing-up of newly constructed properties in an amount not to exceed the fee customarily charged in arm’s length transactions by others rendering similar services in the same geographic area for similar properties as determined by a survey of brokers and agents in such area. Asset Management Fee The Advisor is paid an asset management fee of 0.95% of the Company’s average invested assets, as defined, payable quarterly in an amount equal to 0.2375 of 1% of average invested assets as of the last day of the immediately preceding quarter. Reimbursement of Other expenses For any year in which the Company qualifies as a REIT, the Advisor must reimburse the Company for the amounts, if any, by which the total operating expenses, the sum of the asset management fee plus other operating expenses paid during the previous fiscal year exceed the greater of 2% of average invested assets, as defined, for that fiscal year, or, 25% of net income for that fiscal year. Items such as property operating expenses, depreciation and amortization expenses, interest payments, taxes, non-cash expenditures, the special liquidation distribution, the special termination distribution, organization and offering expenses, and acquisition fees and expenses are excluded from the definition of total operating expenses, which otherwise includes the aggregate expense of any kind paid or incurred by the Company. The Advisor ad certain affiliates of the Sponsor are reimbursed for expenses that may include costs of goods and services, administrative services and non-supervisory services performed directly for the Company by independent parties. Subordinated Profits Interests In connection with the Company’s Offerings, the Sponsor and its wholly owned subsidiary, LGH, contributed (i) cash of $ 12.9 4.8 177 100,000 17.7 These Subordinated Profits Interests may entitle the Associate General Partner to a portion of any regular distributions that the Company makes to its stockholders, but only after its stockholders have received a stated preferred return. There have been no distributions declared on the Subordinated Profits Interests for any periods after December 31, 2019. Since the Company’s inception through December 31, 2023, the cumulative distributions declared and paid on the Subordinated Profits Interests were $ 7.9 The Subordinated Profits Interests may also entitle the Associate General Partner to a portion of any liquidating distributions made by the Operating Partnership. The value of such distributions will depend upon the net proceeds available for distribution upon the Company’s liquidation and, therefore, cannot be determined at the present time. Liquidating distributions to the Associate General Partner will always be subordinated until stockholders receive a distribution equal to their initial investment plus a stated preferred return. The following tables provide further information with respect to the Company’s distributions during its liquidating stage and operating stage, respectively: Liquidating Stage Distributions Amount of Distribution 7% Stockholder Return Threshold Once stockholders have received liquidation distributions, and a cumulative non-compounded 7% return per year on their initial net investment, the Associate General Partner will receive available distributions until it has received an amount equal to its initial purchase price of the Subordinated Profits Interests plus a cumulative non-compounded return of 7% per year. Returns in Excess of 7% Once stockholders have received liquidation distributions, and a cumulative non-compounded return of 7% per year on their initial net investment, 70% of the aggregate amount of any additional distributions from the Operating Partnership will be payable to the stockholders, and 30% of such amount will be payable to the Associate General Partner, until a 12% return is reached. Returns in Excess of 12% After stockholders and the Associate General Partner have received liquidation distributions, and a cumulative non-compounded return of 12% per year on their initial net investment, 60% of any remaining distributions from the Operating Partnership will be distributable to stockholders, and 40% of such amount will be payable to the Associate General Partner. Operating Stage Distributions Amount of Distribution 7% Stockholder Return Threshold Once a cumulative non-compounded return of 7% return on their net investment is realized by stockholders, the Associate General Partner is eligible to receive available distributions from the Operating Partnership until it has received an amount equal to a cumulative non-compounded return of 7% per year on the purchase price of the Subordinated Profits Interests. “Net investment” refers to $10.00 per share, less a pro rata share of any proceeds received from the sale or refinancing of the Company’s assets. Returns in excess of 7% Once a cumulative non-compounded return of 7% per year is realized by stockholders on their net investment, 70% of the aggregate amount of any additional distributions from the Operating Partnership will be payable to the stockholders, and 30% of such amount will be payable to the Associate General Partner until a 12% return is reached. Returns in Excess of 12% After the 12% return threshold is realized by stockholders and the Associate General Partner, 60% of any remaining distributions from the Operating Partnership will be distributable to stockholders, and 40% of such amount will be payable to the Associate General Partner. The following table represents the fees incurred associated with the payments to the Company’s Advisor for the periods indicated: Schedule of fees to related parties For the 2023 2022 Asset management fees (general and administrative costs) $ 2,458 $ 2,739 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 9. Commitments and Contingencies Management Agreements The Company’s hotels operate pursuant to management agreements (the “Management Agreements”) with various third-party property management companies. The property management companies perform management functions including, but not limited to, hiring and supervising employees, establishing room prices, establishing administrative policies and procedures, managing expenditures and arranging and supervising public relations and advertising. The Management Agreements are for terms ranging from 1 10 The Management Agreements provide for the payment of a base management fee equal to 3% 3.5% Franchise Agreements As of December 31, 2023, the Company’s hotels operated pursuant to various franchise agreements. Under the franchise agreements, the Company generally pays a fee equal to 5% 1.5% 3.5% The franchise agreements are generally for initial terms ranging from 15 20 Legal Proceedings From time to time in the ordinary course of business, the Company may become subject to legal proceedings, claims or disputes. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Principles of Consolidation and Basis of Presentation | Principles of Consolidation and Basis of Presentation The consolidated financial statements include the accounts of Lightstone REIT II and the Operating Partnership and its subsidiaries (over which Lightstone REIT II exercises financial and operating control). As of December 31, 2023, Lightstone REIT II had a 99% The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses during a reporting period. The most significant assumptions and estimates relate to the valuation of investment property and investments in other unconsolidated real estate entities and depreciable lives of long-lived assets. Application of these assumptions requires the exercise of judgment as to future uncertainties and, as a result, actual results could differ from these estimates. Investments in other unconsolidated real estate entities where the Company has the ability to exercise significant influence, but does not exercise financial and operating control and is not considered to be the primary beneficiary are accounted for using the equity method. |
Cash and Cash Equivalents and Restricted Cash | Cash and Cash Equivalents and Restricted Cash The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. As required by the Company’s lenders, restricted cash is held in escrow accounts for anticipated capital expenditures, real estate taxes, debt service payments, insurance and other reserves for certain of our properties. Capital reserves are typically utilized for non-operating expenses such as major capital expenditures. Alternatively, a lender may require its own formula for an escrow of capital reserves. The following is a summary of the Company’s cash, cash equivalents, and restricted cash total as presented in our statements of cash flows for the periods presented: Summary of supplemental cash flow information Year Ended 2023 2022 Cash and cash equivalents $ 36,192 $ 42,233 Restricted cash 4,549 333 Total cash, cash equivalents and restricted cash $ 40,741 $ 42,566 Supplemental disclosure of cash flow information: Cash paid for interest $ 7,649 $ 6,107 Cash paid for taxes $ 1,402 $ 212 Distributions declared but not paid $ 1,275 $ - Holding loss on available for sale securities $ 7 $ 7 |
Marketable Securities | Marketable Securities Marketable securities consist of equity and debt securities that are designated as available-for-sale. The Company’s marketable debt securities consist solely of U.S. Treasury Bills, are recorded at fair value and unrealized holding gains or losses are reported as a component of accumulated other comprehensive income. The Company’s marketable equity securities are recorded at fair value and unrealized holding gains and losses are recognized on the consolidated statements of operations. Realized gains or losses resulting from the sale of these securities are determined based on the specific identification of the securities sold. |
Revenue Recognition | Revenue Recognition Revenues consist of amounts derived from hotel operations, including occupied hotel rooms and sales of food, beverage and other ancillary services and are presented on a disaggregated basis below. Revenues are recorded net of any sales or occupancy tax collected from our guests. Room revenue is generated through contracts with customers whereby the customers agree to pay a daily rate for right to use a hotel room. The Company’s contract performance obligations are fulfilled at the end of the day that the customer is provided the room and revenue is recognized daily at the contract rate. Payment from the customer is secured at the end of the contract upon check-out by the customer from our hotel. The Company participates in frequent guest programs sponsored by the brand owners of our hotels whereby the brand owner allows guests to earn loyalty points during their hotel stay. The Company recognizes revenue at the amount earned that it will receive from the brand owner when a guest redeems their loyalty points by staying at one of the Company’s hotels. Revenue from food, beverage and other ancillary services is generated when a customer chooses to purchase goods or services separately from a hotel room and revenue is recognized when these goods or services are provided to the customer and the Company’s contract performance obligations have been fulfilled. Some contracts for rooms, food, beverage or other services require an upfront deposit which is recorded as deferred revenues (or contract liabilities) and recognized once the performance obligations are satisfied. The contract liabilities are not significant. The Company notes no significant judgments regarding the recognition of room, food and beverage or other revenues. The following table represents the total revenues from hotel operations on a disaggregated basis: Schedule of total revenues from hotel operations on a disaggregated basis For the 2023 2022 Revenues Room $ 50,815 $ 52,744 Food, beverage and other 2,817 2,517 Total revenues $ 53,632 $ 55,261 |
Accounts Receivable | Accounts Receivable Accounts receivable primarily represents receivables from hotel guests who occupy hotel rooms and utilize hotel services. The Company maintains an allowance for doubtful accounts sufficient to cover estimated potential credit losses. |
Investment in Real Estate | Investment in Real Estate Accounting for Asset Acquisitions When the Company makes an investment in real estate assets, the cost of real estate assets acquired in an asset acquisition are allocated to the acquired tangible assets, consisting of land, building and improvements, furniture and fixtures and identified intangible assets and liabilities, consisting of the value of above-market and below-market leases, acquired in-place leases, and the value of tenant relationships, based in each case on their relative fair values, at the date of acquisition, based on evaluation of information and estimates available at that date, including independent appraisals that may be obtained in connection with the acquisition or financing of the respective property and other relevant market data. Fees incurred related to asset acquisitions are capitalized as part of the cost of the investment. Carrying Value of Assets The amounts capitalized as a result of periodic improvements and additions to real estate property, when applicable, and the periods over which the assets are depreciated or amortized, are determined based on the application of accounting standards that may require estimates as to fair value and the allocation of various costs to the individual assets. Differences in the amount attributed to the assets can be significant based upon the assumptions made in calculating these estimates. Impairment Evaluation The Company evaluates its investments in real estate assets for potential impairment whenever events or changes in circumstances indicate that the undiscounted projected cash flows are less than the carrying amount for a particular property. The Company evaluates the recoverability of its investments in real estate assets at the lowest identifiable level, which is primarily at the individual property level. No single indicator would necessarily result in the Company preparing an estimate to determine if an individual property’s future undiscounted cash flows are less than its carrying value. The Company uses judgment to determine if the severity of any single indicator, or the fact that there are a number of indicators of less severity that when combined, would result in an indication that a property requires an estimate of the undiscounted cash flows to determine if an impairment has occurred. Relevant facts and circumstances include, among others, significant underperformance relative to historical or projected future operating results and significant negative industry, geographic or economic trends. The undiscounted projected cash flows used for the impairment analysis are subjective and require the Company to use its judgment and the determination of estimated fair value are based on the Company’s plans for the respective assets and the Company’s views of market and economic conditions. The estimates consider matters such as future operating income, market and other applicable trends and residual value, as well as the effects of demand, competition, and recent sales data for comparable properties. An impairment loss is recognized only if the carrying amount of a property is not recoverable and exceeds its fair value. The Company recorded a $ 5.0 no |
Depreciation and Amortization | Depreciation and Amortization Depreciation expense is computed based on the straight-line method over the estimated useful life of the applicable real estate asset. The Company generally uses estimated useful lives of up to 39 5 10 |
Deferred Costs | Deferred Costs Deferred financing costs are recorded at cost and consist of loan fees and other costs incurred in issuing debt. Amortization of deferred financing costs is computed using a method that approximates the effective interest method over the term of the related debt and is included in interest expense in the consolidated statements of operations. Unamortized deferred financing costs are included as a direct deduction from the related debt in the consolidated balance sheets. |
Investments in Unconsolidated Entities | Investments in Unconsolidated Entities The Company evaluates all investments in other entities for consolidation. The Company considers its percentage interest in the joint venture, evaluation of control and whether a variable interest entity exists when determining whether or not the investment qualifies for consolidation or if it should be accounted for as an unconsolidated investment under the equity method of accounting. If an investment qualifies for the equity method of accounting, the Company’s investment is recorded initially at cost, and subsequently adjusted for equity earnings and cash contributions and distributions. The earnings of an unconsolidated investment are allocated to its investors in accordance with the provisions of the operating agreement of the entity. The allocation provisions in these agreements may differ from the ownership interest held by each investor. Differences, if any, between the carrying amount of the Company’s investment in the respective joint venture and our share of the underlying equity of such unconsolidated entity are amortized over the respective lives of the underlying assets as applicable. These items are reported as a single line item in the statements of operations as earnings from investments in unconsolidated entities. The Company reviews investments in unconsolidated entities for impairment in value whenever events or changes in circumstances indicate that the carrying amount of such investment may not be recoverable. An investment in an unconsolidated entity is impaired only if management’s estimate of the fair value of the investment is less than the carrying value of the investment, and such decline in value is deemed to be other than temporary. The ultimate realization of our investment in partially owned entities is dependent on a number of factors including the performance of that entity and market conditions. If the Company determines that a decline in the value of a partially owned entity is other than temporary, it will record an impairment charge. |
Tax Status and Income Taxes | Tax Status and Income Taxes The Company elected to be taxed and qualify as a REIT commencing with the taxable year ended December 31, 2009. As a REIT, the Company generally will not be subject to U.S. federal income tax on its net taxable income that it distributes currently to its stockholders. To maintain its REIT qualification under the Internal Revenue Code of 1986, as amended, or the Code, the Company must meet a number of organizational and operational requirements, including a requirement that it annually distribute to its stockholders at least 90% To maintain its qualification as a REIT, the Company engages in certain activities through a taxable REIT subsidiary (“TRS”), including when it acquires a hotel it usually establishes a new TRS and enters into an operating lease agreement for the hotel. As such, the Company is subject to U.S. federal and state income taxes and franchise taxes from these activities. The Company’s income tax benefits and expense are included in other income/(expense), net on its consolidated statements of operations. During the years ended December 31, 2023 and 2022, the Company recorded income tax expense of $ 1.6 0.2 As of December 31, 2023 and 2022, the Company had no |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying amounts of cash and cash equivalents, restricted cash, accounts receivable and other assets, accounts payable and other accrued expenses, distribution payable and due to related party approximated their fair values as of December 31, 2023 and 2022 because of the short maturity of these instruments. As of December 31, 2023 and 2022, the estimated fair value our mortgages payable approximated their carrying values because they bear interest at a floating rate. |
Concentration of Risk | Concentration of Risk At December 31, 2023 and 2022, the Company had cash deposited in certain financial institutions in excess of U.S. federally insured levels. The Company regularly monitors the financial stability of these financial institutions and believes that it is not exposed to any significant credit risk with respect to its cash and cash equivalents or restricted cash. |
Basic and Diluted Net Earnings per Common Share | Basic and Diluted Net Earnings per Common Share The Company had no potentially dilutive securities outstanding during the periods presented. Accordingly, earnings per share is calculated by dividing net income attributable to common shareholders by the weighted-average number of shares of Common Shares outstanding during the applicable period. |
Current Environment | Current Environment The Company’s operating results and financial condition are substantially impacted by the overall health of local, U.S. national and global economies and may be influenced by market and other challenges. Additionally, its business and financial performance may be adversely affected by current and future economic and other conditions; including, but not limited to, availability or terms of financings, financial markets volatility and banking failures, political upheaval or uncertainty, natural and man-made disasters, terrorism and acts of war, unfavorable changes in laws and regulations, outbreaks of contagious diseases, cybercrime, loss of key relationships, inflation and recession. The Company’s overall performance depends in part on worldwide economic and geopolitical conditions and their impacts on consumer behavior. Worsening economic conditions, increases in costs due to inflation, higher interest rates, certain labor and supply chain challenges and other changes in economic conditions may adversely affect the Company’s results of operations and financial performance. |
New Accounting Pronouncements | New Accounting Pronouncements In June 2016, the Financial Accounting Standards Board, or FASB, issued an accounting standards update, “Financial Instruments-Credit Losses-Measurement of Credit Losses on Financial Instruments,” which changes how entities measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. The updated standard replaces the current “incurred loss” approach with an “expected loss” model for instruments measured at amortized cost. For trade and other receivables and held to maturity debt securities, entities are required to use a new forward looking expected loss model that generally will result in the earlier recognition of allowances for losses. The Company has adopted this standard effective January 1, 2023, noting that it did not have a material impact on its consolidated financial statements. In November 2023, the FASB issued an accounting standards update which is intended to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant expenses. The amendments will require entities to disclose significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”) and included within segment profit and loss, as well as the title and position of the CODM. The amendments are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. The Company is currently evaluating the guidance and the impact it may have on its consolidated financial statements. In December 2023, the FASB issued an accounting standards update which includes amendments that further enhance income tax disclosures, primarily through standardization and disaggregation of rate reconciliation categories and income taxes paid by jurisdiction. This update is effective for annual periods beginning after December 15, 2024. The Company is currently evaluating the guidance and the impact it may have on its consolidated financial statements. The Company has reviewed and determined that other recently issued accounting pronouncements will not have a material impact on its financial position, results of operations and cash flows, or do not apply to its current operations. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of supplemental cash flow information | Summary of supplemental cash flow information Year Ended 2023 2022 Cash and cash equivalents $ 36,192 $ 42,233 Restricted cash 4,549 333 Total cash, cash equivalents and restricted cash $ 40,741 $ 42,566 Supplemental disclosure of cash flow information: Cash paid for interest $ 7,649 $ 6,107 Cash paid for taxes $ 1,402 $ 212 Distributions declared but not paid $ 1,275 $ - Holding loss on available for sale securities $ 7 $ 7 |
Schedule of total revenues from hotel operations on a disaggregated basis | Schedule of total revenues from hotel operations on a disaggregated basis For the 2023 2022 Revenues Room $ 50,815 $ 52,744 Food, beverage and other 2,817 2,517 Total revenues $ 53,632 $ 55,261 |
Investments in Unconsolidated_2
Investments in Unconsolidated Affiliated Entities (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Restructuring Cost and Reserve [Line Items] | |
Summary of investments in unconsolidated entities | Summary of investments in unconsolidated entities As of Entity Date of Ownership Ownership % December 31, December 31, Brownmill Joint Venture Various 48.6 % $ 4,025 $ 4,204 Hilton Garden Inn Joint Venture March 27, 2018 50.0 % 9,390 9,589 Total investments in unconsolidated affiliated real estate entities $ 13,415 $ 13,793 |
Brownmill LLC [Member] | |
Restructuring Cost and Reserve [Line Items] | |
Schedule of condensed income statements | Schedule of condensed income statements For the For the Revenues $ 3,754 $ 4,139 Property operating expenses 1,433 1,792 Depreciation and amortization 750 823 Operating income 1,571 1,524 Gain on disposition of real estate (1) - 5,816 Interest expense and other, net (621 ) (563 ) Net income $ 950 $ 6,777 Company’s share of earnings (48.6%) $ 462 $ 3,293 Additional depreciation and amortization expense (2) (83 ) (316 ) Company’s earnings from investment $ 379 $ 2,977 Notes (1) During the year ended December 31, 2022, the Brownmill Joint Venture recognized a gain on disposition of real estate of $5.8 million in connection with the sale of an outparcel of land and the buildings and improvements thereon at Browntown Shopping Center for a contractual sales price of $10.5 million on August 12, 2022. (2) Additional depreciation and amortization expense is attributable to the difference between the Company’s cost of its interest in the Brownmill Joint Venture and the amount of the underlying equity in net assets of the Brownmill Joint Venture. |
Schedule of condensed balance sheets | Schedule of condensed balance sheets As of As of Investment properties, net $ 12,423 $ 12,860 Cash and restricted cash 1,598 1,422 Other assets 1,153 1,283 Total assets $ 15,174 $ 15,565 Mortgage payable $ 13,075 $ 13,341 Other liabilities 736 662 Members’ capital 1,363 1,562 Total liabilities and members’ capital $ 15,174 $ 15,565 |
Hilton Garden Inn Joint Venture [Member] | |
Restructuring Cost and Reserve [Line Items] | |
Schedule of condensed income statements | Schedule of condensed income statements For the For the Revenues $ 12,417 $ 11,353 Property operating expenses 7,571 6,646 General and administrative costs 139 21 Depreciation and amortization 2,429 2,443 Operating income 2,278 2,243 Interest expense and other, net (2,972 ) (1,997 ) Gain on forgiveness of debt - 516 Net (loss)/income $ (694 ) $ 762 Company’s share of net (loss)/income (50.0%) $ (347 ) $ 381 |
Schedule of condensed balance sheets | Schedule of condensed balance sheets As of As of Investment property, net $ 48,001 $ 50,254 Cash 1,741 1,231 Other assets 1,816 1,276 Total assets $ 51,558 $ 52,761 Mortgage payable, net $ 32,273 $ 32,233 Other liabilities 1,075 1,920 Members’ capital 18,210 18,608 Total liabilities and members’ capital $ 51,558 $ 52,761 |
Marketable Securities, Fair V_2
Marketable Securities, Fair Value Measurements and Margin Loan (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Marketable Securities Fair Value Measurements And Margin Loan | |
Summary of available for sale securities | Summary of available for sale securities As of December 31, 2023 Adjusted Gross Gross Fair Marketable Securities Equity Securities $ 9,582 $ 37 $ (332 ) $ 9,287 As of December 31, 2022 Adjusted Gross Gross Fair Value Marketable Securities Equity securities $ 3,620 $ - $ (321 ) $ 3,299 Debt securities U.S. Treasury Bills 887 7 - 894 Total $ 4,507 $ 7 $ (321 ) $ 4,193 |
Mortgages Payable, Net (Tables)
Mortgages Payable, Net (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of mortgages payable | Schedule of mortgages payable Weighted Description Interest as of Maturity Amount Due As of As of Revolving Credit Facility SOFR + 3.45% 8.38% September 2026 $ 101,818 $ 101,818 $ - Revolving Loan AMERIBOR plus 3.15% Repaid in full - - 118,485 Total mortgages payable 8.38% $ 101,818 101,818 118,485 Less: Deferred financing costs (998 ) (305 ) Total mortgages payable, net $ 100,820 $ 118,180 |
Related Party and Other Trans_2
Related Party and Other Transactions (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Related Party Transactions [Abstract] | |
Schedule of fees to related parties | Schedule of fees to related parties For the 2023 2022 Asset management fees (general and administrative costs) $ 2,458 $ 2,739 |
Business and Structure (Details
Business and Structure (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | |
Sep. 27, 2014 | May 20, 2008 | Dec. 31, 2023 | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Distribution per unit of limited partner interest | $ 100,000 | ||
Business acquired assets | $ 17,700 | ||
Cash | 12,900 | ||
Equity interests | 48.60% | ||
Noncontrolling interests | $ 4,800 | $ 177 | |
Lightstone Value Plus REIT III LLC [Member] | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Issuance of common shares, shares | 20,000 | ||
Issuance of common shares, value | $ 200 | ||
Shares issued, price per share | $ 10 | ||
General Partner [Member] | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Contribution from advisor | $ 2 | ||
Number of limited partner units issued to advisor | 200 | ||
Limited Partner [Member] | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Distribution per unit of limited partner interest | $ 100,000 | ||
Partners capital account, units, contributed | 177 | ||
Partners capital account, contributions | $ 17,700 | ||
Brownmill Joint Venture [Member] | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Ownership interest | 48.60% | ||
Lightstone REIT II [Member] | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
General partner ownership interest | 99% |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Accounting Policies [Abstract] | |||
Cash and cash equivalents | $ 36,192 | $ 42,233 | |
Restricted cash | 4,549 | 333 | |
Total cash, cash equivalents and restricted cash | 40,741 | 42,566 | $ 16,959 |
Cash paid for interest | 7,649 | 6,107 | |
Cash paid for taxes | 1,402 | 212 | |
Distributions declared but not paid | 1,275 | ||
Holding loss on available for sale securities | $ 7 | $ 7 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Details 1) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Product Information [Line Items] | ||
Revenue | $ 53,632 | $ 55,261 |
Room [Member] | ||
Product Information [Line Items] | ||
Revenue | 50,815 | 52,744 |
Food and Beverage [Member] | ||
Product Information [Line Items] | ||
Revenue | $ 2,817 | $ 2,517 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Property, Plant and Equipment [Line Items] | ||
Impairment loss | $ 5,000 | $ 0 |
Real Estate Investment Trust Mandated Annual Distributions Percentage Taxable Income | 90% | |
Income tax expense | $ 1,600 | 200 |
Uncertain income tax positions | $ 0 | $ 0 |
Building and Building Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Estimated Useful Lives | 39 years | |
Furniture and Fixtures [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Estimated Useful Lives | 5 years | |
Furniture and Fixtures [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Estimated Useful Lives | 10 years | |
Lightstone REIT II [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Percentage of general partnership interest in common units of the operating partnership | 99% |
Disposition Activities (Details
Disposition Activities (Details Narrative) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||||
May 08, 2023 | Jul. 14, 2022 | Jul. 21, 2023 | Jul. 18, 2023 | Mar. 22, 2022 | Sep. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2023 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||||
Contractual sales price | $ 28,000 | $ 5,900 | $ 3,230 | |||||
Non-cash impairment charge | $ 5,000 | |||||||
Sale of investment property | $ 800 | |||||||
Principal amount | 4,600 | $ 16,700 | $ 16,700 | |||||
Payments for Loans | 13,400 | |||||||
Issuance costs | 14,100 | |||||||
Working capital | $ 1,200 | $ 17,800 | ||||||
Hampton Inn Suites [Member] | ||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||||
Principal amount | $ 16,700 | |||||||
Fort Lauderdale And Hampton Inn [Member] | ||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||||
Recognized loss on the sale of investment | $ 300 | |||||||
Florida Hotel Portfolio [Member] | ||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||||
Sale of investment property | $ 27,100 | |||||||
Paso Robles [Member] | ||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||||
Sale of investment property | $ 7,700 |
Investments in Unconsolidated_3
Investments in Unconsolidated Affiliated Entities (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Schedule of Equity Method Investments [Line Items] | ||
Total investments in unconsolidated affiliated real estate entities | $ 13,415 | $ 13,793 |
Brownmill Joint Venture [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Ownership percentage | 48.60% | |
Total investments in unconsolidated affiliated real estate entities | $ 4,025 | 4,204 |
Hilton Garden Inn Joint Venture [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Ownership percentage | 50% | |
Total investments in unconsolidated affiliated real estate entities | $ 9,390 | $ 9,589 |
Business acquisition, date of acquisition agreement | Mar. 27, 2018 |
Investments in Unconsolidated_4
Investments in Unconsolidated Affiliated Entities (Details 1) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | ||
Restructuring Cost and Reserve [Line Items] | |||
Revenues | $ 53,632 | $ 55,261 | |
Depreciation and amortization | 6,659 | 7,945 | |
Gain on disposition of real estate | 449 | 8,524 | |
Net income | (11,501) | 8,843 | |
Brownmill Joint Venture [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Revenues | 3,754 | 4,139 | |
Property operating expenses | 1,433 | 1,792 | |
Depreciation and amortization | 750 | 823 | |
Operating income | 1,571 | 1,524 | |
Gain on disposition of real estate | [1] | 5,816 | |
Interest expense and other, net | (621) | (563) | |
Net income | 950 | 6,777 | |
Company’s share of earnings (48.6%) | 462 | 3,293 | |
Additional depreciation and amortization expense | [2] | (83) | (316) |
Company’s earnings from investment | $ 379 | $ 2,977 | |
[1]During the year ended December 31, 2022, the Brownmill Joint Venture recognized a gain on disposition of real estate of $5.8 million in connection with the sale of an outparcel of land and the buildings and improvements thereon at Browntown Shopping Center for a contractual sales price of $10.5 million on August 12, 2022.[2]Additional depreciation and amortization expense is attributable to the difference between the Company’s cost of its interest in the Brownmill Joint Venture and the amount of the underlying equity in net assets of the Brownmill Joint Venture. |
Investments in Unconsolidated_5
Investments in Unconsolidated Affiliated Entities (Details 2) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Restructuring Cost and Reserve [Line Items] | ||
Cash and restricted cash | $ 12,900 | |
Total assets | 209,439 | $ 245,442 |
Members’ capital | 89,104 | 107,486 |
Total liabilities and members’ capital | 209,439 | 245,442 |
Brownmill Joint Venture [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Investment properties, net | 12,423 | 12,860 |
Cash and restricted cash | 1,598 | 1,422 |
Other assets | 1,153 | 1,283 |
Total assets | 15,174 | 15,565 |
Mortgage payable | 13,075 | 13,341 |
Other liabilities | 736 | 662 |
Members’ capital | 1,363 | 1,562 |
Total liabilities and members’ capital | $ 15,174 | $ 15,565 |
Investments in Unconsolidated_6
Investments in Unconsolidated Affiliated Entities (Details 3) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Restructuring Cost and Reserve [Line Items] | ||
Revenues | $ 53,632 | $ 55,261 |
General and administrative costs | 4,426 | 5,129 |
Depreciation and amortization | 6,659 | 7,945 |
Net (loss)/income | (11,501) | 8,843 |
Hilton Garden Inn Joint Venture [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Revenues | 12,417 | 11,353 |
Property operating expenses | 7,571 | 6,646 |
General and administrative costs | 139 | 21 |
Depreciation and amortization | 2,429 | 2,443 |
Operating income | 2,278 | 2,243 |
Interest expense and other, net | (2,972) | (1,997) |
Gain on forgiveness of debt | 516 | |
Net (loss)/income | (694) | 762 |
Company’s share of net (loss)/income (50.0%) | $ (347) | $ 381 |
Investments in Unconsolidated_7
Investments in Unconsolidated Affiliated Entities (Details 4) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Restructuring Cost and Reserve [Line Items] | ||
Investment property, net | $ 201,292 | $ 242,920 |
Cash | 12,900 | |
Total assets | 209,439 | 245,442 |
Members’ capital | 89,104 | 107,486 |
Total liabilities and members’ capital | 209,439 | 245,442 |
Hilton Garden Inn Joint Venture [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Investment property, net | 48,001 | 50,254 |
Cash | 1,741 | 1,231 |
Other assets | 1,816 | 1,276 |
Total assets | 51,558 | 52,761 |
Mortgage payable, net | 32,273 | 32,233 |
Other liabilities | 1,075 | 1,920 |
Members’ capital | 18,210 | 18,608 |
Total liabilities and members’ capital | $ 51,558 | $ 52,761 |
Investments in Unconsolidated_8
Investments in Unconsolidated Affiliated Entities (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Jun. 02, 2020 | Mar. 27, 2023 | Mar. 27, 2018 | Dec. 31, 2023 | Dec. 31, 2022 | |
Schedule of Equity Method Investments [Line Items] | |||||
Partners' Capital Account, Distribution Per Unit of Limited Partner Interest | $ 100,000 | ||||
Hilton Garden Inn Joint Venture [Member] | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Debt instrument, interest rate, basis for effective rate | SOFR plus 3.25% | ||||
Proceeds from mortgage | $ 900 | ||||
Maturity date | May 31, 2028 | ||||
Principal paydown | $ 3,000 | ||||
Capital expenditures description | Additionally, the Hilton Garden Inn Joint Venture is required to fund an aggregate of $1.3 million, through monthly payments of $37 from May 31, 2023 through June 1, 2026, into a cash collateral reserve account which may be drawn upon for specified capital expenditures. | ||||
Brownmill Joint Venture [Member] | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Partners' Capital Account, Distribution Per Unit of Limited Partner Interest | $ 100,000 | ||||
Business acquisition percentage of voting interest acquired | 48.60% | ||||
Proceeds from equity method investment, distribution, return of capital | $ 600 | $ 5,600 | |||
Hilton Garden Inn [Member] | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Aggregate purchase price | $ 60,000 | ||||
Offering funds used in acquisition | 25,000 | ||||
Proceeds from issuance of debt | 35,000 | ||||
Venture pre-funding | $ 12,900 | ||||
Business acquisition percentage of voting interest acquired | 50% | ||||
Debt instrument, interest rate, basis for effective rate | LIBOR plus 3.15%, subject to a 5.03% floor | ||||
Payments to acquire interest in joint venture | 400 | ||||
Distributions received | $ 300 | $ 2,000 |
Marketable Securities, Fair V_3
Marketable Securities, Fair Value Measurements and Margin Loan (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Debt Securities, Held-to-Maturity, Allowance for Credit Loss [Line Items] | ||
Equity securities, Adjusted Cost | $ 4,507 | |
Equity securities, Gross Unrealized Gains | 7 | |
Equity securities, gross unrealized losses | (321) | |
Equity securities, Fair Value | 4,193 | |
Debt Securities [Member] | ||
Debt Securities, Held-to-Maturity, Allowance for Credit Loss [Line Items] | ||
Equity securities, Adjusted Cost | 887 | |
Equity securities, Gross Unrealized Gains | 7 | |
Equity securities, gross unrealized losses | ||
Equity securities, Fair Value | 894 | |
Equity Securities [Member] | ||
Debt Securities, Held-to-Maturity, Allowance for Credit Loss [Line Items] | ||
Equity securities, Adjusted Cost | $ 9,582 | 3,620 |
Equity securities, Gross Unrealized Gains | 37 | |
Equity securities, gross unrealized losses | (332) | (321) |
Equity securities, Fair Value | $ 9,287 | $ 3,299 |
Marketable Securities, Fair V_4
Marketable Securities, Fair Value Measurements and Margin Loan (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | |
Sep. 30, 2022 | Jun. 30, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Impairment charge | $ 5,000 | |||
Sale of investment property | $ 800 | |||
Margin loan | $ 0 | $ 0 | ||
Debt Instrument, Interest Rate Terms | SOFR plus 0.85% | |||
Florida Hotel [Member] | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Sale of investment property | $ 27,100 |
Mortgages Payable, Net (Details
Mortgages Payable, Net (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Short-Term Debt [Line Items] | ||
Debt, Weighted Average Interest Rate | 8.38% | |
Amount due at maturity | $ 101,818 | |
Total mortgages payable | 101,818 | $ 118,485 |
Less: Deferred financing costs | (998) | (305) |
Total mortgages payable, net | $ 100,820 | 118,180 |
Revolving Credit Facility [Member] | ||
Short-Term Debt [Line Items] | ||
Debt Instrument, Description of Variable Rate Basis | SOFR + 3.45% (floor of 6.45%) | |
Debt, Weighted Average Interest Rate | 8.38% | |
Maturity Date | September 2026 | |
Amount due at maturity | $ 101,818 | |
Total mortgages payable | $ 101,818 | |
Revolving Loan [Member] | ||
Short-Term Debt [Line Items] | ||
Debt Instrument, Description of Variable Rate Basis | AMERIBOR plus 3.15% (floor of 4.00%) | |
Amount due at maturity | ||
Total mortgages payable | $ 118,485 |
Mortgages Payable, Net (Detai_2
Mortgages Payable, Net (Details Narrative) - USD ($) $ in Thousands | 1 Months Ended | ||||||
Jul. 14, 2022 | Oct. 23, 2023 | Jul. 21, 2023 | Jul. 18, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | Jul. 13, 2016 | |
Debt Instrument [Line Items] | |||||||
Principal amount | $ 4,600 | $ 16,700 | $ 16,700 | ||||
Outstanding balance | 118,500 | $ 101,800 | $ 118,500 | ||||
Revolving Credit Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Maximum borrowing capacity percentage | 65% | ||||||
Maturity date | Oct. 23, 2023 | ||||||
Face amount | $ 123,100 | ||||||
SOFR [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate | 5.35% | ||||||
AMERIBOR [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate | 4.64% |
Stockholder_s Equity (Details N
Stockholder’s Equity (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | ||||
Mar. 18, 2024 | Feb. 16, 2024 | Nov. 28, 2023 | Mar. 22, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | |
Equity [Abstract] | ||||||
Annual distributions paid per share | $ 0.30 | $ 0.30 | ||||
Annualized distribution rate | 3% | 3% | ||||
Share Price | $ 10 | $ 10 | ||||
Distribution paid in cash | $ 5,100 | |||||
Common share distribution per share | $ 0.075 | |||||
Repurchase of shares | 520,141 | 860,000 | 170,425 | 158,885 | ||
Weighted average price per share | $ 6 | $ 10.05 | $ 8.89 | |||
Shares repurchased value | $ 3,100 | $ 5,200 | ||||
Share redemption program, annual limitation, percentage of weighted average shares outstanding | 0.50% |
Related Party and Other Trans_3
Related Party and Other Transactions (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Advisor [Member] | ||
Related Party Transaction [Line Items] | ||
Asset management fees (general and administrative costs) | $ 2,458 | $ 2,739 |
Related Party and Other Trans_4
Related Party and Other Transactions (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Sep. 27, 2014 | |
Related Party Transactions [Abstract] | ||
Cash | $ 12,900 | |
Equity interests | 4,800 | |
Noncontrolling interests | $ 177 | $ 4,800 |
Distribution per unit of limited partner interest | $ 100,000 | |
Aggregate consideration | $ 17,700 | |
Distributions declared and paid | $ 7,900 |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) | 12 Months Ended |
Dec. 31, 2023 | |
Loss Contingencies [Line Items] | |
Franchise Fee Percentage | 5% |
Minimum [Member] | |
Loss Contingencies [Line Items] | |
Management Agreement Term | 1 year |
Property Management Fee, Percent Fee | 3% |
Marketing Fund Charge Percent | 1.50% |
Franchise Agreement Term | 15 years |
Maximum [Member] | |
Loss Contingencies [Line Items] | |
Management Agreement Term | 10 years |
Property Management Fee, Percent Fee | 3.50% |
Marketing Fund Charge Percent | 3.50% |
Franchise Agreement Term | 20 years |