Document And Entity Information
Document And Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Mar. 20, 2018 | Jun. 30, 2017 | |
Document Information [Line Items] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2017 | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY | ||
Entity Registrant Name | Strategic Realty Trust, Inc. | ||
Entity Central Index Key | 1,446,371 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Common Stock, Shares Outstanding | 10,988,438 | ||
Entity Public Float | $ 0 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | ||
Investments in real estate | ||||
Land | $ 14,020 | $ 15,510 | ||
Building and improvements | 30,825 | 47,810 | ||
Tenant improvements | 1,188 | 2,307 | ||
Investments in real estate, gross | 46,033 | 65,627 | ||
Accumulated depreciation | (2,579) | (8,163) | ||
Investments in real estate, net | 43,454 | 57,464 | ||
Properties under development and development costs | ||||
Land | 25,851 | 25,851 | ||
Buildings | 585 | 601 | ||
Development costs | 9,609 | 4,377 | ||
Properties under development and development costs | 36,045 | 30,829 | ||
Cash and cash equivalents | 3,086 | 3,130 | ||
Restricted cash | 816 | 4,728 | ||
Prepaid expenses and other assets, net | 200 | 1,070 | ||
Tenant receivables, net of $0 and $38 bad debt reserve | 1,007 | 1,269 | ||
Investments in unconsolidated joint ventures | 2,705 | 4,761 | ||
Lease intangibles, net | 2,061 | 3,825 | ||
Assets held for sale | 20,646 | 24,157 | ||
Deferred financing costs, net | 1,258 | 264 | ||
TOTAL ASSETS (1) | 111,278 | [1] | 131,497 | |
LIABILITIES | ||||
Notes payable, net | [2] | 42,223 | 54,304 | |
Accounts payable and accrued expenses | 2,006 | 2,955 | ||
Amounts due to affiliates | 21 | 111 | ||
Other liabilities | 387 | 461 | ||
Liabilities related to assets held for sale | 13,017 | 22,182 | ||
Below-market lease liabilities, net | 438 | 3,049 | ||
Deferred gain on sale of properties to unconsolidated joint venture | 668 | 1,202 | ||
TOTAL LIABILITIES (1) | 58,760 | 84,264 | ||
Commitments and contingencies (Note 13) | ||||
EQUITY | ||||
Preferred stock, $0.01 par value; 50,000,000 shares authorized, none issued and outstanding | 0 | 0 | ||
Common stock, $0.01 par value; 400,000,000 shares authorized; 10,988,438 and 10,938,245 shares issued and outstanding at December 31, 2017 and 2016, respectively | 111 | 111 | ||
Additional paid-in capital | 96,097 | 96,032 | ||
Accumulated deficit | (44,741) | (50,676) | ||
Total stockholders’ equity | 51,467 | 45,467 | ||
Non-controlling interests | 1,051 | 1,766 | ||
TOTAL EQUITY | 52,518 | 47,233 | ||
TOTAL LIABILITIES AND EQUITY | 111,278 | 131,497 | ||
Variable Interest Entity, Primary Beneficiary [Member] | ||||
Properties under development and development costs | ||||
Land | 25,851 | 25,851 | ||
Buildings | 585 | 601 | ||
Development costs | 9,609 | 4,377 | ||
Properties under development and development costs | 36,045 | 30,829 | ||
Cash and cash equivalents | 281 | 334 | ||
Restricted cash | 818 | 1,666 | ||
Prepaid expenses and other assets, net | 9 | 14 | ||
Tenant receivables, net of $0 and $38 bad debt reserve | 0 | 1 | ||
TOTAL ASSETS (1) | [3] | 37,153 | 32,844 | |
LIABILITIES | ||||
Notes payable, net | [4] | 19,116 | 19,103 | |
Accounts payable and accrued expenses | 478 | 806 | ||
Amounts due to affiliates | 9 | 9 | ||
Other liabilities | 9 | 27 | ||
TOTAL LIABILITIES (1) | $ 19,612 | $ 19,945 | ||
[1] | As of December 31, 2017 and 2016, includes approximately $37.2 million and $32.8 million, respectively, of assets related to consolidated variable interest entities that can be used only to settle obligations of the consolidated variable interest entities and approximately $19.6 million and $19.9 million, respectively, of liabilities of consolidated variable interest entities for which creditors do not have recourse to the general credit of the Company. Refer to Note 5. “Variable Interest Entities”. | |||
[2] | The carrying value of the Company’s notes payable represents the outstanding principal as of December 31, 2017, and 2016. The carrying values and fair values of the notes payable include the reclassification of deferred financing costs, net, of approximately $0.1 million and $0.3 million, respectively, as a contra-liability, as of December 31, 2017 and 2016. | |||
[3] | The assets of the Gelson’s Joint Venture and Wilshire Joint Venture can be used only to settle obligations of the respective consolidated joint ventures. | |||
[4] | As of both December 31, 2017 and 2016, includes reclassification of approximately $0.1 million of deferred financing costs, net, as a contra-liability. The creditors of the consolidated joint ventures do not have recourse to the general credit of the Company. The notes payable of the consolidated joint ventures are not guaranteed by the Company. |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Preferred stock par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 50,000,000 | 50,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 400,000,000 | 400,000,000 |
Common stock, shares issued | 10,988,438 | 10,938,245 |
Common stock, shares outstanding | 10,988,438 | 10,938,245 |
Bad debt reserve | $ 0 | $ 38 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Revenue: | ||
Rental and reimbursements | $ 9,035 | $ 10,476 |
Expense: | ||
Operating and maintenance | 3,257 | 3,745 |
General and administrative | 1,979 | 2,196 |
Depreciation and amortization | 2,848 | 3,373 |
Transaction expense | 85 | 772 |
Interest expense | 1,824 | 2,212 |
Total expense | 9,993 | 12,298 |
Operating loss | (958) | (1,822) |
Other income (loss): | ||
Equity in income (loss) of unconsolidated joint ventures | (59) | 132 |
Net gain on disposal of real estate | 11,608 | 640 |
Other Income (expense) | 91 | 154 |
Loss on extinguishment of debt | (1,645) | (966) |
Income (loss) before income taxes | 9,037 | (1,862) |
Income taxes | (181) | (129) |
Net income (loss) | 8,856 | (1,991) |
Net income (loss) attributable to non-controlling interests | 295 | (75) |
Net income (loss) attributable to common stockholders | $ 8,561 | $ (1,916) |
Earnings (loss) per common share - basic and diluted | $ 0.78 | $ (0.17) |
Weighted average shares outstanding used to calculate earnings (loss) per common share - basic and diluted | 10,936,361 | 11,006,759 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENT OF EQUITY - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Non-controlling Interests | Total Stockholders' Equity |
BALANCE at Dec. 31, 2015 | $ 52,665 | $ 111 | $ 96,684 | $ (46,124) | $ 1,994 | $ 50,671 |
BALANCE (in shares) at Dec. 31, 2015 | 11,037,948 | |||||
Stock Issued During Period, Shares, Conversion of Units | 9,588 | |||||
Stock Issued During Period, Value, Conversion of Units | 0 | $ 0 | 0 | (52) | 52 | |
Conversion of Stock, Amount Converted | 52 | |||||
Redemption of common shares (in shares) | (109,291) | |||||
Redemption of common shares, value | (704) | $ 0 | (704) | 0 | 0 | (704) |
Quarterly distributions | (2,737) | $ 0 | 0 | (2,636) | (101) | (2,636) |
Stock Dividends, Shares | 0 | |||||
Net income (loss) | (1,991) | $ 0 | 0 | (1,916) | (75) | (1,916) |
BALANCE at Dec. 31, 2016 | 47,233 | $ 111 | 96,032 | (50,676) | 1,766 | 45,467 |
BALANCE (in shares) at Dec. 31, 2016 | 10,938,245 | |||||
Stock Issued During Period, Shares, Conversion of Units | 187,114 | |||||
Stock Issued During Period, Value, Conversion of Units | 0 | $ 0 | 0 | (930) | 930 | |
Conversion of Stock, Amount Converted | 930 | |||||
Redemption of common shares (in shares) | (136,921) | |||||
Redemption of common shares, value | (865) | $ 0 | (865) | 0 | 0 | (865) |
Quarterly distributions | (2,706) | $ 0 | 0 | (2,626) | (80) | (2,626) |
Stock Dividends, Shares | 0 | |||||
Net income (loss) | 8,856 | $ 0 | 0 | 8,561 | 295 | 8,561 |
BALANCE at Dec. 31, 2017 | $ 52,518 | $ 111 | $ 96,097 | $ (44,741) | $ 1,051 | $ 51,467 |
BALANCE (in shares) at Dec. 31, 2017 | 10,988,438 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Conversion of Stock, Amount Converted | $ 930 | $ 52 |
Cash flows from operating activities: | ||
Net income (loss) | 8,856 | (1,991) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Net gain on disposal of real estate | (11,608) | (640) |
Loss on extinguishment of debt | 1,645 | 966 |
Equity in income (loss) of unconsolidated joint ventures | 59 | (132) |
Straight-line rent | (238) | (155) |
Amortization of deferred costs | 541 | 492 |
Depreciation and amortization | 2,848 | 3,373 |
Amortization of above and below-market leases | (144) | (196) |
Bad debt expense | 14 | 53 |
Changes in operating assets and liabilities: | ||
Prepaid expenses and other assets | 853 | (339) |
Tenant receivables | 89 | 362 |
Accounts payable and accrued expenses | (613) | (108) |
Amounts due to affiliates | (90) | 62 |
Other liabilities | (74) | (258) |
Net change in restricted cash for operational expenditures | 1,806 | (98) |
Net cash provided by operating activities | 3,944 | 1,391 |
Cash flows from investing activities: | ||
Net proceeds from the sale of real estate | 46,633 | 8,763 |
Acquisition of real estate | (17,812) | (17,792) |
Investment in properties under development and development costs | (5,081) | (29,400) |
Improvements, capital expenditures, and leasing costs | (1,494) | (492) |
Distributions from unconsolidated joint ventures | 1,997 | 2,273 |
Net change in restricted cash from investments in consolidated variable interest entities | 848 | (1,666) |
Net change in restricted cash for capital expenditures | 1,258 | (271) |
Net cash provided by (used in) investing activities | 26,349 | (38,585) |
Cash flows from financing activities: | ||
Redemption of common shares | (865) | (704) |
Quarterly distributions | (2,714) | (2,742) |
Proceeds from notes payable | 60,700 | 47,600 |
Repayment of notes payable | (84,054) | (10,976) |
Loan proceeds from an affiliate | 2,500 | 0 |
Repayment of loan from an affiliate | (2,500) | 0 |
Payment of penalties associated with early repayment of notes payable | (1,410) | (839) |
Payment of loan fees from investments in consolidated variable interest entities | (453) | (719) |
Payment of loan fees and financing costs | (1,541) | (89) |
Net cash (used in) provided by financing activities | (30,337) | 31,531 |
Net decrease in cash and cash equivalents | (44) | (5,663) |
Cash and cash equivalents – beginning of year | 3,130 | 8,793 |
Cash and cash equivalents – end of year | 3,086 | 3,130 |
Supplemental disclosure of non-cash investing and financing activities and other cash flow information: | ||
Distributions declared but not paid | 673 | 681 |
Change in accrued liabilities capitalized to investment in development | (340) | 640 |
Change to accrued mortgage note payable interest capitalized to investment in development | 12 | 166 |
Amortization of deferred loan fees capitalized to investment in development | 463 | 623 |
Cash paid for interest, net of amounts capitalized | $ 1,351 | $ 1,517 |
ORGANIZATION AND BUSINESS
ORGANIZATION AND BUSINESS | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND BUSINESS | ORGANIZATION AND BUSINESS Strategic Realty Trust, Inc. (the “Company”) was formed on September 18, 2008, as a Maryland corporation. Effective August 22, 2013, the Company changed its name from TNP Strategic Retail Trust, Inc. to Strategic Realty Trust, Inc. The Company believes it qualifies as a real estate investment trust (“REIT”) under the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), and has elected REIT status beginning with the taxable year ended December 31, 2009, the year in which the Company began material operations. Since the Company’s inception, its business has been managed by an external advisor. The Company has no direct employees and all management and administrative personnel responsible for conducting the Company’s business are employed by its advisor. Currently, the Company is externally managed and advised by SRT Advisor, LLC, a Delaware limited liability company (the “Advisor”) pursuant to an advisory agreement with the Advisor (the “Advisory Agreement”) initially executed on August 10, 2013, and subsequently renewed every year through 2017. The current term of the Advisory Agreement terminates on August 10, 2018. The Advisor is an affiliate of Glenborough, LLC (together with its affiliates, “Glenborough”), a privately held full-service real estate investment and management company focused on the acquisition, management and leasing of commercial properties. Substantially all of the Company’s business is conducted through Strategic Realty Operating Partnership, L.P. (the “OP”). During the Company’s initial public offering (“Offering”), as the Company accepted subscriptions for shares of its common stock, it transferred substantially all of the net proceeds of the Offering to the OP as a capital contribution. The Company is the sole general partner of the OP. As of December 31, 2017 and 2016 , the Company owned 97.9% and 96.3% , respectively, of the limited partnership interests in the OP. The Company’s principal demand for funds has been for the acquisition of real estate assets, the payment of operating expenses, interest on outstanding indebtedness, the payment of distributions to stockholders, and investments in unconsolidated joint ventures as well as development of properties. Substantially all of the proceeds of the completed Offering have been used to fund investments in real properties and other real estate-related assets, for payment of operating expenses, for payment of interest, for payment of various fees and expenses, such as acquisition fees and management fees, and for payment of distributions to stockholders. The Company’s available capital resources, cash and cash equivalents on hand and sources of liquidity are currently limited. The Company expects its future cash needs will be funded using cash from operations, future asset sales, debt financing and the proceeds to the Company from any sale of equity that it may conduct in the future. The Company invests in and manages a portfolio of income-producing retail properties, located in the United States, real estate-owning entities and real estate-related assets, including the investment in or origination of mortgage, mezzanine, bridge and other loans related to commercial real estate. The Company has invested directly, and indirectly through joint ventures, in a portfolio of income-producing retail properties located throughout the United States, with a focus on grocery anchored multi-tenant retail centers, including neighborhood, community and lifestyle shopping centers, multi-tenant shopping centers and free standing single-tenant retail properties. During the first quarter of 2016, the Company invested, through joint ventures, in two significant retail projects under development. As of December 31, 2017 , in addition to the development projects, the Company’s portfolio of properties was comprised of 10 properties, including three properties held for sale, with approximately 303,000 rentable square feet of retail space located in four states. As of December 31, 2017 , the rentable space at the Company’s retail properties was 96% leased. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation and Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) as contained within the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) and the rules and regulations of the Securities and Exchange Commission (the “SEC”), including the instructions to Form 10-K and Regulation S-X. The consolidated financial statements include the accounts of the Company, the OP, their direct and indirect owned subsidiaries, and the accounts of joint ventures that are determined to be variable interest entities for which the Company is the primary beneficiary. All significant intercompany balances and transactions are eliminated in consolidation. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) necessary to present fairly the Company’s consolidated financial position, results of operations and cash flows have been included. The Company evaluates the need to consolidate joint ventures and variable interest entities based on standards set forth in ASC Topic 810, Consolidation (“ASC 810”). In determining whether the Company has a controlling interest in a joint venture or a variable interest entity and the requirement to consolidate the accounts of that entity, management considers factors such as ownership interest, authority to make decisions and contractual and substantive participating rights of the partners/members, as well as whether the entity is a variable interest entity for which the Company is the primary beneficiary. As of December 31, 2017 and 2016 , the Company held ownership interests in two unconsolidated joint ventures. Refer to Note 4. “Investments in Unconsolidated Joint Ventures” for additional information. As of December 31, 2017 and 2016 , the Company held variable interests in two variable interest entities and consolidated those entities. Refer to Note 5. “Variable Interest Entities” for additional information. Non-Controlling Interests The Company’s non-controlling interests are comprised of common units in the OP (“Common Units”). The Company accounts for non-controlling interests in accordance with ASC 810. In accordance with ASC 810, the Company reports non-controlling interests in subsidiaries within equity in the consolidated financial statements, but separate from stockholders’ equity. Net income (loss) attributable to non-controlling interests is presented as a reduction from net income (loss) in calculating net income (loss) attributable to common stockholders on the consolidated statement of operations. Acquisitions or dispositions of non-controlling interests that do not result in a change of control are accounted for as equity transactions. In addition, ASC 810 requires that a parent company recognize a gain or loss in the Company’s results of operations when a subsidiary is deconsolidated upon a change in control. In accordance with ASC 480-10, Distinguishing Liabilities from Equity , non-controlling interests that are determined to be redeemable are carried at their fair value or redemption value as of the balance sheet date and reported as liabilities or temporary equity depending on their terms. The Company periodically evaluates individual non-controlling interests for the ability to continue to recognize the non-controlling interest as permanent equity in the consolidated balance sheets. Any non-controlling interest that fails to qualify as permanent equity will be reclassified as liabilities or temporary equity. All non-controlling interests at December 31, 2017 and 2016, qualified as permanent equity. Use of Estimates The preparation of the Company’s consolidated financial statements requires significant management judgments, assumptions and estimates about matters that are inherently uncertain. These judgments affect the reported amounts of assets and liabilities and the Company’s disclosure of contingent assets and liabilities at the dates of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting periods. With different estimates or assumptions, materially different amounts could be reported in the Company’s consolidated financial statements, and actual results could differ from the estimates or assumptions used by management. Additionally, other companies may utilize different estimates that may impact the comparability of the Company’s consolidated results of operations to those of companies in similar businesses. The Company considers significant estimates to include the carrying amounts and recoverability of investments in real estate, impairments, real estate acquisition purchase price allocations, allowance for doubtful accounts, estimated useful lives to determine depreciation and amortization and fair value determinations, among others. Cash and Cash Equivalents Cash and cash equivalents represent current bank accounts and other bank deposits free of encumbrances and having maturity dates of three months or less from the respective dates of deposit. The Company limits cash investments to financial institutions with high credit standing; therefore, the Company believes it is not exposed to any significant credit risk in cash. Restricted Cash Restricted cash includes escrow accounts for real property taxes, insurance, capital expenditures and tenant improvements, debt service and leasing costs held by lenders. Revenue Recognition Revenues include minimum rents, expense recoveries and percentage rental payments. Minimum rents are recognized on an accrual basis over the terms of the related leases on a straight-line basis when collectability is reasonably assured and the tenant has taken possession or controls the physical use of the leased property. If the lease provides for tenant improvements, the Company determines whether the tenant improvements, for accounting purposes, are owned by the tenant or the Company. When the Company is the owner of the tenant improvements, the tenant is not considered to have taken physical possession or have control of the physical use of the leased asset until the tenant improvements are substantially completed. When the tenant is the owner of the tenant improvements, any tenant improvement allowance that is funded is treated as a lease incentive and amortized as a reduction of revenue over the lease term. Tenant improvement ownership is determined based on various factors including, but not limited to: • whether the lease stipulates how a tenant improvement allowance may be spent; • whether the amount of a tenant improvement allowance is in excess of market rates; • whether the tenant or landlord retains legal title to the improvements at the end of the lease term; • whether the tenant improvements are unique to the tenant or general-purpose in nature; and • whether the tenant improvements are expected to have any residual value at the end of the lease. For leases with minimum scheduled rent increases, the Company recognizes income on a straight-line basis over the lease term when collectability is reasonably assured. Recognizing rental income on a straight-line basis for leases results in recognized revenue amounts which differ from those that are contractually due from tenants on a cash basis. If the Company determines the collectability of straight-line rents is not reasonably assured, the Company limits future recognition to amounts contractually owed and paid, and, when appropriate, establishes an allowance for estimated losses. The Company maintains an allowance for doubtful accounts, including an allowance for straight-line rent receivables, for estimated losses resulting from tenant defaults or the inability of tenants to make contractual rent and tenant recovery payments. The Company monitors the liquidity and creditworthiness of its tenants on an ongoing basis. For straight-line rent amounts, the Company’s assessment is based on amounts estimated to be recoverable over the term of the lease. The Company’s straight-line rent receivable (not including receivables on property held for sale), which is included in tenant receivables, net, on the consolidated balance sheets, was approximately $0.5 million and $0.6 million at December 31, 2017 and 2016, respectively. Certain leases contain provisions that require the payment of additional rents based on the respective tenants’ sales volume (contingent or percentage rent) and substantially all contain provisions that require reimbursement of the tenants’ allocable real estate taxes, insurance and common area maintenance costs (“CAM”). Revenue based on percentage of tenants’ sales is recognized only after the tenant exceeds its sales breakpoint. Revenue from tenant reimbursements of taxes, insurance and CAM is recognized in the period that the applicable costs are incurred in accordance with the lease agreement. The Company recognizes gains or losses on sales of real estate in accordance with ASC 360, Property, Plant, and Equipment (“ASC 360”). Gains are not recognized and are deferred until (a) a sale has been consummated; (b) the buyer’s initial and continuing investments are adequate to demonstrate a commitment to pay for the property; (c) the Company’s receivable, if any, is not subject to future subordination; and (d) the Company has transferred to the buyer the usual risks and reward of ownership, and the Company does not have a substantial continuing involvement with the property. Deferred gain on the sale of properties to the SGO Joint Venture was approximately $0.7 million and $1.2 million , as of December 31, 2017 and 2016, respectively. Valuation of Accounts Receivable The Company makes estimates of the collectability of its tenant receivables related to base rents, including deferred rents receivable, expense reimbursements and other revenue or income. The Company analyzes tenant receivables, deferred rent receivable, historical bad debts, customer creditworthiness, current economic trends and changes in customer payment terms when evaluating the adequacy of the allowance for doubtful accounts. In addition, with respect to tenants in bankruptcy, the Company will make estimates of the expected recovery of pre-petition and post-petition claims in assessing the estimated collectability of the related receivable. In some cases, the ultimate resolution of these claims can exceed one year. When a tenant is in bankruptcy, the Company will record a bad debt reserve for the tenant’s receivable balance and generally will not recognize subsequent rental revenue until cash is received or until the tenant is no longer in bankruptcy and has the ability to make rental payments. Concentration of Credit Risk A concentration of credit risk arises in the Company’s business when a nationally or regionally-based tenant occupies a substantial amount of space in multiple properties owned by the Company. In that event, if the tenant suffers a significant downturn in its business, it may become unable to make its contractual rent payments to the Company, exposing the Company to potential losses in rental revenue, expense recoveries, and percentage rent. Generally, the Company does not obtain security deposits from the nationally-based or regionally-based tenants in support of their lease obligations to the Company. The Company regularly monitors its tenant base to assess potential concentrations of credit risk. As of December 31, 2017, excluding properties classified as held for sale, Clover Juice accounted for more than 10% of the Company’s annual minimum rent. As of December 31, 2017, there were no amounts outstanding from Clover Juice. As of December 31, 2016, excluding properties classified as held for sale, Ralph’s Grocery and Gold’s Gym , each accounted for more than 10% of the Company’s annual minimum rent. As of December 31, 2016, there were no amounts outstanding from either Ralph’s Grocery or Gold’s Gym. Business Combinations The Company records the acquisition of income-producing real estate or real estate that will be used for the production of income as a business combination when the acquired property meets the definition of a business, as further discussed below. Assets acquired and liabilities assumed in a business combination are generally measured at their acquisition-date fair values, including tenant improvements and identifiable intangible assets or liabilities. Tenant improvements recognized represent the tangible assets associated with the existing leases valued on a fair value basis at the acquisition date. Tenant improvements are classified as assets under investments in real estate and are depreciated over the remaining lease terms. Identifiable intangible assets and liabilities relate to the value of in-place operating leases which come in three forms: (1) leasing commissions and legal costs, which represent the value associated with “cost avoidance” of acquiring in-place leases, such as lease commissions paid under terms generally experienced in markets in which the Company operates; (2) value of in-place leases, which represents the estimated loss of revenue and of costs incurred for the period required to lease the “assumed vacant” property to the occupancy level when purchased; and (3) above- or below-market value of in-place leases, which represents the difference between the contractual rents and market rents at the time of the acquisition, discounted for tenant credit risks. The value of in-place leases is recorded in acquired lease intangibles and amortized over the remaining lease term. Above- or below-market-rate leases are classified in acquired lease intangibles, or in acquired below-market lease intangibles, depending on whether the contractual terms are above- or below-market. Above-market leases are amortized as a decrease to rental revenue over the remaining non-cancelable terms of the respective leases and below-market leases are amortized as an increase to rental revenue over the remaining initial lease term and any fixed rate renewal periods, if applicable. Acquisition costs are expensed as incurred. Costs incurred in pursuit of targeted properties for acquisitions not yet closed or those determined to no longer be viable and costs incurred which are expected to result in future period disposals of property not currently classified as held for sale properties have been expensed and are also classified in the consolidated statements of operations as transaction expenses. Estimates of the fair values of the tangible assets, identifiable intangibles and assumed liabilities require the Company to make significant assumptions to estimate market lease rates, property operating expenses, carrying costs during lease-up periods, discount rates, market absorption periods, and the number of years the property will be held for investment. The use of inappropriate assumptions would result in an incorrect valuation of the Company’s acquired tangible assets, identifiable intangibles and assumed liabilities, which would impact the amount of the Company’s results of operations. These allocations also impact depreciation expense, amortization expense and gains or losses recorded on future sales of properties. Reportable Segments ASC 280, Segment Reporting , establishes standards for reporting financial and descriptive information about an enterprise’s reportable segments. The Company has one reportable segment, income-producing retail properties, which consists of activities related to investing in real estate. The retail properties are geographically diversified throughout the United States, and the Company evaluates operating performance on an overall portfolio level. Investments in Real Estate In January 2017, the FASB issued Accounting Standards Update (“ASU”) No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business (“ASU 2017-01”) that clarifies the framework for determining whether an integrated set of assets and activities meets the definition of a business. The revised framework establishes a screen for determining whether an integrated set of assets and activities is a business and narrows the definition of a business, which is expected to result in fewer transactions being accounted for as business combinations. Acquisitions of integrated sets of assets and activities that do not meet the definition of a business are accounted for as asset acquisitions. The Company elected to early adopt ASU 2017-01 for the reporting period beginning January 1, 2017. As a result of adopting ASU 2017-01, the Company’s acquisitions of properties beginning January 1, 2017, were evaluated under the new guidance. The acquisitions occurring during 2017 were determined to be asset acquisitions, as they did not meet the revised definition of a business. Evaluation of business combination or asset acquisition: The Company evaluates each acquisition of real estate to determine if the integrated set of assets and activities acquired meet the definition of a business and need to be accounted for as a business combination. If either of the following criteria is met, the integrated set of assets and activities acquired would not qualify as a business: • Substantially all of the fair value of the gross assets acquired is concentrated in either a single identifiable asset or a group of similar identifiable assets; or • The integrated set of assets and activities is lacking, at a minimum, an input and a substantive process that together significantly contribute to the ability to create outputs (i.e. revenue generated before and after the transaction). An acquired process is considered substantive if: • The process includes an organized workforce (or includes an acquired contract that provides access to an organized workforce), that is skilled, knowledgeable, and experienced in performing the process; • The process cannot be replaced without significant cost, effort, or delay; or • The process is considered unique or scarce. Generally, the Company expects that acquisitions of real estate will not meet the revised definition of a business because substantially all of the fair value is concentrated in a single identifiable asset or group of similar identifiable assets (i.e. land, buildings, and related intangible assets), or because the acquisition does not include a substantive process in the form of an acquired workforce or an acquired contract that cannot be replaced without significant cost, effort or delay. In asset acquisitions, the purchase consideration, including acquisition costs, is allocated to the individual assets acquired and liabilities assumed on a relative fair value basis. As a result, asset acquisitions do not result in the recognition of goodwill or a bargain purchase gain. Depreciation and amortization is computed using a straight-line method over the estimated useful lives of the assets as follows: Years Buildings and improvements 5 - 30 years Tenant improvements 1 - 36 years Tenant improvement costs recorded as capital assets are depreciated over the tenant’s remaining lease term, which the Company has determined approximates the useful life of the improvement. Expenditures for ordinary maintenance and repairs are expensed to operations as incurred. Significant renovations and improvements that improve or extend the useful lives of assets are capitalized. Acquisition costs related to asset acquisitions are capitalized in the consolidated balance sheets. For acquisitions of real estate prior to the adoption of ASU 2017-01, which were generally accounted for as business combinations, the Company recognized the assets acquired (including the intangible value of acquired above- or below-market leases, acquired in-place leases and other intangible assets or liabilities) at fair value as of the acquisition date. Acquisition costs related to the business combinations were expensed as incurred. Properties Under Development The initial cost of properties under development includes the acquisition cost of the property, direct development costs and borrowing costs directly attributable to the development. Borrowing costs associated with direct expenditures on properties under development are capitalized. The amount of capitalized borrowing costs is determined by reference to borrowings specific to the project, where relevant. Borrowing costs are capitalized from the commencement of the development until the date of practical completion. Practical completion is when the property is capable of operating in the manner intended by management. Capitalization of borrowing costs is suspended if there are prolonged periods when development activity is interrupted. Capitalized costs are reduced by any profits from incidental operations. Interest on projects is based on interest rates in place during the development period, and is capitalized until the project is ready for its intended use. The amount of interest capitalized during the years ended December 31, 2017 and 2016, was approximately $3.4 million and $2.8 million , respectively. Impairment of Long-lived Assets The Company continually monitors events and changes in circumstances that could indicate that the carrying amounts of its investments in real estate and related intangible assets may not be recoverable. When indicators of potential impairment suggest that the carrying value of real estate and related intangible assets may not be recoverable, the Company assesses the recoverability by estimating whether the Company will recover the carrying value of the real estate and related intangible assets through its undiscounted future cash flows (excluding interest) and its eventual disposition. If, based on this analysis, the Company does not believe that it will be able to recover the carrying value of the real estate and related intangible assets and liabilities, the Company would record an impairment loss to the extent that the carrying value exceeds the estimated fair value of the investments in real estate and related intangible assets. Key inputs that the Company estimates in this analysis include projected rental rates, capital expenditures, property sale capitalization rates, and expected holding period of the property. The Company evaluates its equity investments for impairment in accordance with ASC 320, Investments – Debt and Securities (“ASC 320”). ASC 320 provides guidance for determining when an investment is considered impaired, whether impairment is other-than-temporary, and measurement of an impairment loss. The Company continually monitors its properties under development for impairment. Estimates of future cash flows used to test the recoverability of properties under development are based on their expected service potential when development is substantially complete. Those estimates include cash flows associated with all future expenditures necessary to develop the properties under development, including interest payments that will be capitalized as part of the cost of the properties under development. The Company did not record any impairment losses during the years ended December 31, 2017 and 2016. Assets Held for Sale and Discontinued Operations When certain criteria are met, long-lived assets are classified as held for sale and are reported at the lower of their carrying value or their fair value, less costs to sell, and are no longer depreciated. For property sales on or after May 1, 2014, a disposal of a component of an entity is required to be reported as discontinued operations only if the disposal represents a strategic shift that has (or will have) a major effect on an entity’s operations and financial results. Refer to Note 3. “Real Estate Investments” for a discussion of property sales and discontinued operations. Fair Value Measurements Under GAAP, the Company is required to measure or disclose certain financial instruments at fair value on a recurring basis. In addition, the Company is required to measure other financial instruments and balances at fair value on a non-recurring basis (e.g., carrying value of impaired real estate loans receivable and long-lived assets). Fair value is defined as the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The GAAP fair value framework uses a three-tiered approach. Fair value measurements are classified and disclosed in one of the following three categories: • Level 1: unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities; • Level 2: quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which significant inputs and significant value drivers are observable in active markets; and • Level 3: prices or valuation techniques where little or no market data is available for inputs that are significant to the fair value measurement. When available, the Company utilizes quoted market prices or other observable inputs (Level 2 inputs), such as interest rates or yield curves, from independent third-party sources to determine fair value and classify such items in Level 1 or Level 2. In instances where the market for a financial instrument is not active, regardless of the availability of a nonbinding quoted market price, observable inputs might not be relevant and could require the Company to use significant judgment to derive a fair value measurement. Additionally, in an inactive market, a market price quoted from an independent third-party may rely more on models with inputs based on information available only to that independent third party. When the Company determines the market for an asset owned by it to be illiquid or when market transactions for similar instruments do not appear orderly, the Company uses several valuation sources (including internal valuations, discounted cash flow analysis and external appraisals) and establishes a fair value by assigning weights to the various valuation sources. Additionally, when determining the fair value of liabilities in circumstances in which a quoted price in an active market for an identical liability is not available, the Company measures fair value using (i) a valuation technique that uses the quoted price of the identical liability when traded as an asset or quoted prices for similar liabilities when traded as assets; or (ii) a present value technique that considers the future cash flows based on contractual obligations discounted by observed or estimated market rates of comparable liabilities. The use of contractual cash flows with regard to amount and timing significantly reduces the judgment applied in arriving at fair value. Changes in assumptions or estimation methodologies can have a material effect on these estimated fair values. In this regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, may not be realized in an immediate settlement of the instrument. The Company considers the following factors to be indicators of an inactive market: (1) there are few recent transactions; (2) price quotations are not based on current information; (3) price quotations vary substantially either over time or among market makers (for example, some brokered markets); (4) indexes that previously were highly correlated with the fair values of the asset or liability are demonstrably uncorrelated with recent indications of fair value for that asset or liability; (5) there is a significant increase in implied liquidity risk premiums, yields, or performance indicators (such as delinquency rates or loss severities) for observed transactions or quoted prices when compared with the Company’s estimate of expected cash flows, considering all available market data about credit and other nonperformance risk for the asset or liability; (6) there is a wide bid-ask spread or significant increase in the bid-ask spread; (7) there is a significant decline or absence of a market for new issuances (that is, a primary market) for the asset or liability or similar assets or liabilities; and (8) little information is released publicly (for example, a principal-to-principal market). The Company considers the following factors to be indicators of non-orderly transactions: (1) there was not adequate exposure to the market for a period before the measurement date to allow for marketing activities that are usual and customary for transactions involving such assets or liabilities under current market conditions; (2) there was a usual and customary marketing period, but the seller marketed the asset or liability to a single market participant; (3) the seller is in or near bankruptcy or receivership (that is, distressed), or the seller was required to sell to meet regulatory or legal requirements (that is, forced); and (4) the transaction price is an outlier when compared with other recent transactions for the same or similar assets or liabilities. Deferred Financing Costs Deferred financing costs represent commitment fees, loan fees, legal fees and other third-party costs associated with obtaining financing. These costs are amortized over the terms of the respective financing agreements using the straight-line method which approximates the effective interest method. Unamortized deferred financing costs are expensed when the associated debt is refinanced or repaid before maturity. Costs incurred in seeking financings that do not close are expensed in the period in which it is determined that the financing will not close. The Company presents deferred financing costs, net of accumulated amortization, as a contra-liability that reduces the carrying amount of the associated note payable, rather than as a deferred asset. Deferred financing costs related to a line-of-credit arrangement are presented on the balance sheet as a deferred asset, regardless of whether there were any outstanding borrowings at period-end. Accounting for Investments in Unconsolidated Joint Ventures The Company accounts for its current investments in unconsolidated joint ventures under the equity method of accounting. Under the equity method of accounting, the Company records its initial investment in a joint venture at cost and subsequently adjusts the cost for the Company’s share of the joint venture’s income or loss and cash contributions and distributions each period. Refer to Note 4. “Investments in Unconsolidated Joint Ventures” for a discussion of the Company’s investments in joint ventures. The Company monitors its investments in unconsolidated joint ventures periodically for impairment. No impairment indicators were identified and no impairment losses were recorded during the years ended December 31, 2017 and 2016. Income Taxes The Company has elected to be taxed as a REIT under the Internal Revenue Code. To qualify as a REIT, the Company must meet certain organizational and operational requirements, including a requirement to distribute at least 90% of the Company’s annual REIT taxable income to stockholders (which is computed without regard to the dividends paid deduction or net capital gain and which does not necessarily equal net income as calculated in accordance with GAAP). As a REIT, the Company generally will not be subject to federal income tax on income that it distributes as dividends to its stockholders. If the Company fails to qualify as a REIT in any taxable year, it will be subject to federal income tax on its taxable income at regular corporate income tax rates and generally will not be permitted to qualify for treatment as a REIT for federal income tax purposes for the four taxable years following the year during which qualification is lost, unless the Internal Revenue Service grants the Company relief under certain statutory provisions. Such an event could materially and adversely affect the Company’s net income and net cash available for distribution to stockholders. However, the Company believes that it is organized and operates in such a manner as to qualify for treatment as a REIT. Even if the Company qualifies as a REIT, it may be subject to certain state or local income taxes, and to U.S. federal income and excise taxes on its undistributed income. The Company evaluates tax positions taken in the consolidated financial statements under the interpretation for accounting for uncertainty in income taxes. As a result of this evaluation, the Company may recognize a tax benefit from an uncertain |
REAL ESTATE INVESTMENTS
REAL ESTATE INVESTMENTS | 12 Months Ended |
Dec. 31, 2017 | |
Real Estate Investments, Net [Abstract] | |
REAL ESTATE INVESTMENTS | REAL ESTATE INVESTMENTS 2017 Acquisition of Properties On January 4, 2017, the Company purchased certain property located in the Hayes Valley neighborhood at 388 Fulton Street in San Francisco, California (“388 Fulton”). The seller was not affiliated with the Company or the Advisor. 388 Fulton is comprised of two leased commercial condominiums with an aggregate of 3,110 square feet of retail space. The aggregate purchase price of 388 Fulton was approximately $4.2 million , subject to customary closing costs and proration adjustments. The Company drew down $4.0 million on its line of credit to fund this acquisition. On January 11, 2017, the Company purchased certain property located in the Silver Lake neighborhood of Los Angeles, California (“Silver Lake”). The seller was not affiliated with the Company or the Advisor. Silver Lake is comprised of two boutique retail buildings totaling approximately 10,497 square feet of retail space. The aggregate purchase price of Silver Lake was approximately $13.3 million subject to customary closing costs and proration adjustments. The Company drew down $11.0 million on its line of credit to fund this acquisition. The Company evaluated the above transactions under the new framework pursuant to ASU 2017-01, which the Company early-adopted effective January 1, 2017. Acquisitions that do not meet the definition of a business are accounted for as asset acquisitions. Refer to Note 2. “Summary of Significant Accounting Policies” for further details. Accordingly, the Company accounted for the purchases of Silver Lake and 388 Fulton as asset acquisitions and allocated the total cash consideration to the individual assets and liabilities acquired on a relative fair value basis. For the year ended December 31, 2017 , the Company incurred $0.3 million of acquisition-related costs. These costs were capitalized and allocated to land and buildings acquired on a relative fair value basis. 2016 Acquisition of Properties On June 14, 2016, the Company, through an indirect subsidiary, purchased a 100% ownership interest in two retail properties located in the Hayes Valley neighborhood at 400 Grove Street and 8 Octavia Street in San Francisco, California (the “San Francisco Properties”) from each of Octavia Gateway Holdings, LLC and Grove Street Hayes Valley, LLC, each a Delaware limited liability company and each a subsidiary of DDG Partners LLC. The sellers were not affiliated with the Company or the Advisor. The San Francisco Properties encompass four retail condominiums with an aggregate of 5,640 square feet of retail space. The aggregate purchase price of the San Francisco Properties was approximately $5.6 million subject to customary closing costs and proration adjustments. The Company funded the purchase price using borrowings under the Amended and Restated Credit Facility (“KeyBank Credit Facility”). Refer to Note 8. “Notes Payable, Net” for details. On July 27, 2016, the Company purchased a 100% ownership interest in Fulton Street Shops located in San Francisco, California (“Fulton Shops”). The seller was not affiliated with the Company or the Advisor. Fulton Shops is comprised of five high-quality street retail condominiums with an aggregate of 3,758 square feet of retail space. The aggregate purchase price of Fulton Shops was approximately $4.6 million subject to customary closing costs and proration adjustments. The Company drew down $4.7 million on the KeyBank Credit Facility to fund this acquisition. Refer to Note 8. “Notes Payable, Net” for details. On September 8, 2016, the Company paid a deposit in the amount of approximately $0.2 million toward the acquisition of a 100% ownership interest in certain property located in the Hayes Valley neighborhood at 388 Fulton Street in San Francisco, California (“388 Fulton”). The deposit was included in prepaid expenses and other assets, net on the consolidated balance sheets. The seller is not affiliated with the Company or the Advisor. 388 Fulton is comprised of two leased commercial condominiums with an aggregate of 3,110 square feet of retail space. The purchase of this retail property closed on January 4, 2017. Refer to Note 14. “Subsequent Events” for details. On December 22, 2016, in conjunction with the acquisition of the San Francisco Properties, (as defined below), the Company, through an indirect subsidiary, purchased a 100% ownership interest in certain property located in the Hayes Valley neighborhood at 450 Hayes Street in San Francisco, California (“450 Hayes”). The seller is not affiliated with the Company or its external advisor. 450 Hayes is comprised of two high-quality street retail condominiums with an aggregate of 3,724 square feet of retail space. The aggregate consideration of 450 Hayes was approximately $7.6 million subject to customary closing costs and proration adjustments. The Company drew down $7.2 million on the KeyBank Credit Facility to fund this acquisition. Refer to Note 8. “Notes Payable, Net” for details. The following table summarizes the estimated fair values of the acquired tangible and intangible assets and assumed liabilities as of the acquisition date (amounts in thousands): San Francisco Properties Fulton Shops 450 Hayes Land $ 1,737 $ 1,187 $ 2,324 Building and improvements 3,660 3,254 5,009 Lease intangibles, net 376 257 410 Below-market lease liabilities, net (143 ) (103 ) (176 ) Estimated fair value of net assets acquired $ 5,630 $ 4,595 $ 7,567 Lease intangibles and below-market lease liabilities generally relate to commercial leases. As of December 31, 2016, the remaining weighted-average amortization periods of lease intangibles and below-market lease liabilities related to the acquired properties were 11.4 years and 11.2 years , respectively. For the year ended December 31, 2016, the Company incurred $0.7 million of acquisition-related costs. These costs are included in transaction expenses in the consolidated statements of operations. For the year ended December 31, 2016, the Company recognized $0.4 million of total revenues and $0.3 million of operating expenses from these properties. 2017 Sale of Properties On November 1, 2017, the Company consummated the disposition of Morningside Marketplace, located in Fontana, California for $12.7 million in cash. The proceeds were used to pay down amounts outstanding under the Company’s line of credit. The sale of the property did not represent a strategic shift that will have a major effect on the Company’s operations and financial results and its results of operations were not reported as discontinued operations on the Company’s consolidated financial statements. The disposition of Morningside Marketplace resulted in a gain of $2.4 million , which was included in the Company’s consolidated statement of operations. On October 31, 2017, the Company consummated the disposition of Cochran Bypass, located in Chester, South Carolina, for a sales price of approximately $2.5 million in cash. The net proceeds from the sale of Cochran Bypass were used to repay a portion of the outstanding balance under the Company’s line of credit. The sale of the property did not represent a strategic shift that will have a major effect on the Company’s operations and financial results and its results of operations were not reported as discontinued operations on the Company’s consolidated financial statements. The disposition of Cochran Bypass resulted in a gain of $44 thousand , which was included in the Company’s consolidated statement of operations. On April 17, 2017, the Company consummated the disposition of Woodland West Marketplace, located in Arlington, Texas, for a sales price of approximately $14.6 million in cash. The Company used the net proceeds from the sale of Woodland West Marketplace to repay $13.7 million of the outstanding balance on its line of credit. The sale of the property did not represent a strategic shift that will have a major effect on the Company’s operations and financial results and its results of operations were not reported as discontinued operations on the Company’s consolidated financial statements. The disposition of Woodland West Marketplace resulted in a gain of $2.5 million , which was included on the Company’s consolidated statement of operations. On January 6, 2017, the Company consummated the disposition of Pinehurst Square East, located in Bismarck, North Dakota, for a sales price of approximately $19.2 million in cash. The Company used the net proceeds from the sale of Pinehurst Square East to repay $18.4 million of the outstanding balance on its line of credit. The sale of the property did not represent a strategic shift that will have a major effect on the Company’s operations and financial results and its results of operations were not reported as discontinued operations on the Company’s consolidated financial statements. The disposition of Pinehurst Square East resulted in a gain of $6.1 million , which was included on the Company’s consolidated statement of operations. The following table summarizes net operating income (loss) related to the properties sold in 2017, that is included in the Company’s consolidated statements of operations for the years ended December 31, 2017 and 2016 (amounts in thousands): Year Ended December 31, 2017 2016 Pinehurst Square East Woodland West Marketplace Cochran Bypass Morningside Marketplace Pinehurst Square East Woodland West Marketplace Cochran Bypass Morningside Marketplace Operating income (loss) $ 22 $ 193 $ 27 $ 322 $ 1,028 $ (178 ) $ 2 $ 51 2016 Sale of Properties On April 4, 2016, the Company consummated the disposition of Bloomingdale Hills, located in Riverside, Florida, for a sales price of approximately $9.2 million in cash, a portion of which was used to pay off the related $5.3 million mortgage loan and $3.0 million of which was used to pay down the line of credit under the KeyBank Credit Facility. The sale of the property did not represent a strategic shift that will have a major effect on the Company’s operations and financial results and its results of operations were not reported as discontinued operations on the Company’s consolidated financial statements. The disposition of Bloomingdale Hills resulted in a gain of $0.6 million , which was included on the Company’s consolidated statement of operations. The Company’s consolidated statements of operations included net operating income of approximately $69 thousand for the year ended December 31, 2016. Pro Forma Financial Information The pro forma financial information below is based upon the Company’s historical consolidated statements of operations for the years ended December 31, 2017 and 2016 , adjusted to give effect to the above sale transactions as if they had been completed at the beginning of 2017 and 2016, respectively. The pro forma financial information is presented for information purposes only, and may not be indicative of what actual results of operations would have been had the transaction occurred at the beginning of 2017 and 2016, respectively, nor does it purport to represent results of operations for future periods (amounts in thousands, except per share amounts): (Pro Forma) Year Ended 2017 2016 Rental and reimbursement revenues $ 6,888 $ 5,076 Net income 8,292 8,186 Net income attributable to common stockholders 8,017 7,881 Net income per share, attributable to common shares - basic and diluted $ 0.73 $ 0.72 Assets Held for Sale and Liabilities Related to Assets Held for Sale At December 31, 2017 , Florissant Marketplace, located in Florissant, Missouri, Ensenada Square, located in Arlington, Texas, and Shops at Turkey Creek, located in Knoxville, Tennessee, were classified as held for sale in the consolidated balance sheet. Since the sale of these properties does not represent a strategic shift that will have a major effect on the Company’s operations and financial results, the results of operations of these properties were not reported as discontinued operations in the Company’s financial statements. The Company intends to use the net proceeds from the sale of these properties to repay a portion of the outstanding balance on its line of credit. The Company anticipates the sales of these three properties will occur within one year from December 31, 2017 . The Company’s consolidated statements of operations include net operating income of approximately $0.6 million and $0.2 million for the years ended December 31, 2017 and 2016 , respectively, related to the assets held for sale. At December 31, 2016, Pinehurst Square East, located in Bismarck, North Dakota, and Woodland West Marketplace, located in Arlington, Texas, were classified as held for sale in the consolidated balance sheet. As previously disclosed, the Company consummated the disposition of Pinehurst Square East on January 6, 2017 and Woodland West Marketplace on April 17, 2017. The major classes of assets and liabilities related to assets held for sale included in the consolidated balance sheets are as follows (amounts in thousands): December 31, 2017 2016 ASSETS Investments in real estate Land $ 5,248 $ 5,718 Building and improvements 17,522 20,261 Tenant improvements 1,189 1,283 23,959 27,262 Accumulated depreciation (5,178 ) (4,257 ) Investments in real estate, net 18,781 23,005 Tenant receivables, net 248 135 Lease intangibles, net 1,617 1,017 Assets held for sale $ 20,646 $ 24,157 LIABILITIES Notes payable $ 10,749 $ 21,783 Below-market lease intangibles, net 2,268 399 Liabilities related to assets held for sale $ 13,017 $ 22,182 Amounts above are being presented at their carrying value, which the Company believes to be lower than their estimated fair value less costs to sell. |
INVESTMENTS IN UNCONSOLIDATED J
INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES | 12 Months Ended |
Dec. 31, 2017 | |
Equity Method Investments and Joint Ventures [Abstract] | |
INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES | INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES SGO Joint Venture Entry into SGO Joint Venture Agreement On March 11, 2015, the Company, through a wholly-owned subsidiary, entered into the Limited Liability Company Agreement of SGO Retail Acquisition Venture, LLC (the “SGO Agreement”) to form a joint venture with Grocery Retail Grand Avenue Partners, LLC, a subsidiary of Oaktree Real Estate Opportunities Fund VI, L.P. (“Oaktree”), and GLB SGO, LLC, a wholly-owned subsidiary of Glenborough Property Partners, LLC (“GPP” and together with the Company and Oaktree, the “SGO Members”). GPP is an affiliate of the Company’s property manager, Glenborough, and an affiliate of the Advisor. The joint venture obtained a $34.0 million non-recourse mortgage loan from an unaffiliated third-party lender to purchase the properties. The SGO Agreement provides for the ownership and operation of SGO Retail Acquisition Venture, LLC (the “SGO Joint Venture”), in which the Company owns a 19% interest, GPP owns a 1% interest, and Oaktree owns an 80% interest. In exchange for ownership in the SGO Joint Venture, the Company contributed $4.5 million to the SGO Joint Venture, which amount was credited against the sale of the Initial SGO Properties (as defined below) to the Joint Venture (as described below), GPP contributed $0.2 million to the SGO Joint Venture, and Oaktree contributed $19.1 million to the SGO Joint Venture. Pursuant to the SGO Agreement, GPP manages and conducts the day-to-day operations and affairs of the SGO Joint Venture, subject to certain major decisions set forth in the SGO Agreement that require the consent of at least two members, one of whom must be Oaktree. Income, losses and distributions will generally be allocated based on the members’ respective ownership interests. Additionally, in certain circumstances described in the SGO Agreement, the SGO Members may be required to make additional capital contributions to the SGO Joint Venture, in proportion to the SGO Members’ respective ownership interests. Pursuant to the SGO Agreement, the SGO Joint Venture pays GPP a monthly asset management fee equal to a percentage of the aggregate investment value of the property owned by the SGO Joint Venture in the preceding month. In addition, if Oaktree has received a 12% internal rate of return on its capital contribution, then promptly following the sale of the last of the Initial SGO Properties, the SGO Joint Venture will pay GPP a disposition fee equal to 1% of the aggregate net sales proceeds received by the SGO Joint Venture from the sales of the Initial SGO Properties. The SGO Joint Venture may make distributions of net cash flow to the SGO Members no less than quarterly, if appropriate. Distributions are pro rata to the SGO Members in proportion to their respective ownership interests in the SGO Joint Venture until the SGO Members have received a 12% internal rate of return on their capital contribution. Thereafter distributions will be 5% to the Company, 5% to GPP and the balance to the Company, GPP and Oaktree pro rata in proportion to each SGO Member’s respective ownership interests in the SGO Joint Venture until Oaktree has received aggregate distributions in an amount necessary to provide Oaktree with the greater of a 17% internal rate of return on its capital contribution and a 1.5 equity multiple on its capital contribution. Distributions will then be 12.5% to the Company, 5% to GPP and the balance to the Company, GPP and Oaktree pro rata in proportion to each SGO Member’s respective ownership interests in the SGO Joint Venture until Oaktree has received aggregate distributions in an amount necessary to provide Oaktree with the greater of a 22% internal rate of return on its capital contribution and a 1.75 equity multiple on its capital contribution (the “SGO Promoted Returns”). Distributions will then be 20% to the Company, 5% to GPP and the balance to the Company, GPP and Oaktree pro rata in proportion to each SGO Member’s respective ownership interests in the SGO Joint Venture. The portion of the SGO Promoted Returns payable to GPP are referred to herein as the “GPP SGO Incentive Fee.” The portion of the SGO Promoted Returns payable to the Company are referred to herein as the Company’s “SGO Earn Out.” As a part of the negotiations for the SGO Joint Venture, Glenborough agreed to reduce certain property management and related charges payable by the SGO Joint Venture from levels that were in place for these assets when held by the Company; the GPP SGO Incentive Fee was implemented in order to provide GPP and its affiliates with an opportunity to recoup those reductions should the SGO Joint Venture assets perform well financially. Sale of Initial Properties to SGO Joint Venture On March 11, 2015, as part of the formation of the SGO Joint Venture, the Company entered into a Purchase and Sale Agreement to sell Osceola Village, Constitution Trail and Aurora Commons to the SGO Joint Venture. The closing of the sale was conditioned on the SGO Joint Venture issuing the Company a 19% membership interest and GPP a 1% membership interest in the SGO Joint Venture. Due to the related party membership interests in the SGO Joint Venture, the sale of the Initial Properties was considered a partial sale in accordance with ASC Subtopic 360-20, Property, Plant, and Equipment – Real Estate Sales . The related party interests consist of the Company’s 19% and GPP’s 1% membership interests in the SGO Joint Venture. As a result, the Company deferred $1.2 million , representing 20% , of the total realized gain from the sale of the Initial Properties to the SGO Joint Venture. During the year ended December 31, 2017, the SGO Joint Venture completed the sales of the Aurora Common property and a portion of Osceola Village. During the year ended December 31, 2016, the SGO Joint Venture completed the sale of Constitution Trail. As a result of the sales, during the years ended December 31, 2017 and 2016, the Company recognized approximately $0.5 million and $23 thousand , respectively, of the previously deferred gain. SGO MN Joint Venture On September 30, 2015, the Company, through wholly-owned subsidiaries, entered into the Limited Liability Company Agreement of SGO MN Retail Acquisitions Venture, LLC (the “SGO MN Agreement”) to form a joint venture with MN Retail Grand Avenue Partners, LLC, a subsidiary of Oaktree, and GLB SGO MN, LLC, a wholly-owned subsidiary of GPP (together with the Company and Oaktree, the “SGO MN Members”). The SGO MN Agreement provides for the ownership and operation of SGO MN Retail Acquisition Venture, LLC (the “SGO MN Joint Venture”), in which the Company owns a 10% interest, GPP owns a 10% interest, and Oaktree owns an 80% interest. In exchange for ownership in the SGO MN Joint Venture, the Company contributed cash in the amount of $2.8 million to the SGO MN Joint Venture, GPP contributed $2.8 million to the SGO MN Joint Venture, and Oaktree contributed $22.7 million to the SGO MN Joint Venture. On September 30, 2015, the SGO MN Joint Venture used the capital contributions of the SGO MN Members, together with the proceeds of a loan from Bank of America, NA in the amount of $50.5 million , to acquire 14 retail properties located in Minnesota, North Dakota and Nebraska (the “SGO MN Properties”) from a subsidiary of IRET Properties, L.P., a subsidiary of Investors Real Estate Trust (“IRET”), for a total purchase price of $79.0 million . Subsequently, the SGO MN Joint Venture purchased an additional two retail properties in Minnesota from IRET for a purchase price of $1.6 million , one transaction closed on December 23, 2015 and the other on January 8, 2016. In 2016, the SGO MN Joint Venture sold six of the properties and distributed the net sales proceeds, after required reduction of debt, to the SGO MN Members. In 2017, the SGO MN Joint Venture sold two of the SGO MN Properties and distributed the net sales proceeds, after required reduction of debt, to the SGO MN Members. Pursuant to the SGO MN Agreement, GPP manages and conducts the day-to-day operations and affairs of the SGO MN Joint Venture, subject to certain major decisions set forth in the SGO MN Agreement that require the consent of at least two of the SGO MN Members, one of whom must be Oaktree. Income, losses and distributions are generally allocated based on the SGO MN Members’ respective ownership interests. Additionally, in certain circumstances described in the SGO MN Agreement, the SGO MN Members may be required to make additional capital contributions to the SGO MN Joint Venture, in proportion to the Members’ respective ownership interests. Pursuant to the SGO MN Agreement, the SGO MN Joint Venture pays GPP a monthly asset management fee equal to a percentage of the aggregate investment value of the property owned by the SGO MN Joint Venture in the preceding month. In addition, if Oaktree has received a 12% internal rate of return on its capital contribution, then promptly following the sale of the last of the SGO MN Properties, the SGO MN Joint Venture will pay GPP a disposition fee equal to one percent of the aggregate net sales proceeds received by the SGO MN Joint Venture from the sales of the SGO MN Properties. The SGO MN Joint Venture makes distributions of net cash flow to the SGO MN Members no less than quarterly, if appropriate. Distributions are pro rata to the SGO MN Members in proportion to their respective ownership interests in the SGO MN Joint Venture until the SGO MN Members have received a 12% internal rate of return on their capital contribution. Thereafter distributions will be 10% to GPP and the balance to the Company, GPP and Oaktree pro rata in proportion to each SGO MN Member’s respective ownership interests in the SGO MN Joint Venture until Oaktree has received aggregate distributions in an amount necessary to provide Oaktree with the greater of a 17% internal rate of return on its capital contribution and a 1.5 equity multiple on its capital contribution. Distributions will then be 17.5% to GPP and the balance to the Company, GPP and Oaktree pro rata in proportion to each SGO MN Member’s respective ownership interests in the SGO MN Joint Venture until Oaktree has received aggregate distributions in an amount necessary to provide Oaktree with the greater of a 22% internal rate of return on its capital contribution and a 1.75 equity multiple on its capital contribution (the “Promoted Returns”). Distributions will then be 25% to GPP and the balance to the Company, GPP and Oaktree pro rata in proportion to each SGO MN Member’s respective ownership interests in the SGO MN Joint Venture. The portion of the Promoted Returns payable to GPP are referred to herein as the “GPP Incentive Fee.” As a part of the negotiations for the SGO MN Joint Venture, Glenborough agreed to certain reduced property management and related charges payable by the SGO MN Joint Venture; the GPP Incentive Fee was implemented in order to provide GPP and its affiliates with an opportunity to recoup those reductions should the SGO MN Joint Venture assets perform well financially. The following table summarizes the Company’s investments in unconsolidated joint ventures as of December 31, 2017 and 2016 (amounts in thousands): Ownership Interest Investment Joint Venture Date of Investment December 31, December 31, December 31, December 31, SGO Retail Acquisitions Venture, LLC 3/11/2015 19 % 19 % $ 978 $ 3,052 SGO MN Retail Acquisitions Venture, LLC 9/30/2015 10 % 10 % 1,727 1,709 Total $ 2,705 $ 4,761 Year Ended December 31, December 31, Equity in income (loss) of unconsolidated joint ventures $ (59 ) $ 132 A summary of the aggregate balance sheets and results of operations of the SGO Joint Venture and the SGO MN Joint Venture is presented below (amounts in thousands): December 31, 2017 2016 ASSETS Investments in real estate, net $ 64,541 $ 64,032 Other assets 5,408 18,453 Assets held for sale 1,169 5,265 Total assets $ 71,118 $ 87,750 LIABILITIES AND MEMBERS’ CAPITAL Notes payable $ 45,062 $ 40,418 Other liabilities 2,737 8,907 Liabilities held for sale 900 5,273 Total liabilities 48,699 54,598 Members’ capital 22,419 33,152 Total liabilities and members’ capital $ 71,118 $ 87,750 Year Ended December 31, 2017 2016 RESULTS OF OPERATIONS Revenue $ 9,129 $ 15,523 Expenses (9,603 ) (17,139 ) Operating loss (474 ) (1,616 ) Other income 350 3,355 Net income (loss) $ (124 ) $ 1,739 The Company’s off-balance sheet arrangements consist primarily of investments in the joint ventures as set forth in the table above. The joint ventures typically fund their cash needs through secured debt financings obtained by and in the name of the joint venture entity. The joint ventures’ debts are secured by a first mortgage, are without recourse to the joint venture members, and do not represent a liability of the members other than carve-out guarantees for certain matters such as environmental conditions, misuse of funds and material misrepresentations. As of December 31, 2017 and 2016 , the Company has provided carve-out guarantees in connection with the two aforementioned unconsolidated joint ventures; in connection with those carve-out guarantees, the Company has certain rights of recovery from the joint venture members. |
VARIABLE INTEREST ENTITIES
VARIABLE INTEREST ENTITIES | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
VARIABLE INTEREST ENTITIES | VARIABLE INTEREST ENTITIES The Company has variable interests in, and is the primary beneficiary of, variable interest entities (“VIEs”) through its investments in (i) the Gelson’s Joint Venture and (ii) the 3032 Wilshire Joint Venture (both as defined below). The Company has consolidated the accounts of these variable interest entities. Gelson’s Joint Venture On January 7, 2016, the Company, through wholly-owned subsidiaries, entered into the Limited Liability Company Agreement of Sunset & Gardner Investors, LLC (the “Gelson’s Joint Venture Agreement”) to form a joint venture (the” Gelson’s Joint Venture”) with Sunset & Gardner LA, LLC (“S&G LA” and, together with the Company, the “Gelson’s Members”), a subsidiary of Cadence Capital Investments, LLC (“Cadence”). The Gelson’s Joint Venture Agreement provides for the ownership and operation of certain real property by the Gelson’s Joint Venture, in which the Company owns a 100% capital interest and a 50% profits interest. In exchange for ownership in the Gelson’s Joint Venture, the Company contributed cash in an amount up to $7.0 million in initial capital contributions and has agreed to contribute a minimum of $0.7 million in subsequent capital contributions to the Gelson’s Joint Venture. In May 2016, the Company made an additional capital contribution of $0.2 million to the Gelson’s Joint Venture. In January 2017 and July 2017, the Company made two additional capital contributions of $0.8 million and $1.3 million , respectively, to the Gelson’s Joint Venture. S&G LA contributed its rights to acquire the real property, its interest under a 20 -year lease with Gelson’s Markets (the “Gelson’s Lease”) and agreed to provide certain management and development services. On January 28, 2016, the Gelson’s Joint Venture used the capital contributions of the Company, together with the proceeds of a loan in the amount of $10.7 million , to purchase property located at the corner of Sunset Boulevard and Gardner in Hollywood, California for a build-to-suit grocery store for Gelson’s Markets (the “Gelson’s Property”) from a third party seller, for a total purchase price of approximately $13.0 million . The Gelson’s Joint Venture intends to proceed with obtaining all required governmental approvals and entitlements to replace the existing improvements on the property with a build-to-suit grocery store for Gelson’s Markets with an expected size of approximately 38,000 square feet. Gelson’s Markets was founded in 1951 and is recognized as one of the nation’s premier supermarket chains. Gelson’s Markets currently has 28 locations throughout Southern California. Pursuant to the Gelson’s Joint Venture Agreement, S&G LA manages and conducts the day-to-day operations and affairs of the Gelson’s Joint Venture, subject to certain major decisions set forth in the Gelson’s Joint Venture Agreement that require the consent of all the Gelson’s Members. The Company has the power to direct the activities of the Gelson’s Joint Venture through its approval process of the activities that most significantly impact the economic performance of the Gelson’s Joint Venture. Such activities include the budgeting, leasing, financings, and ultimately, the sale of the property. Income, losses and distributions are generally allocated based on the Gelson’s Members’ respective capital and profits interests. Through the Company’s commitment to contribute 100% of capital to develop and operate the property through the life of the Gelson’s Joint Venture, the Company has an obligation to absorb losses of the Gelson’s Joint Venture. Additionally, in certain circumstances described in the Gelson’s Joint Venture Agreement, the Company may be required to make additional capital contributions to the Joint Venture, in proportion to the Gelson’s Members’ respective ownership interests. Until the Company has received back its capital contribution and specified preferred returns, all distributions go to the Company; thereafter, the Gelson’s Joint Venture will distribute the profits 50% to the Company and 50% to S&G LA. Additionally, the Company has the ability to buy out S&G LA upon certain conditions per the Operating Agreement. 3032 Wilshire Joint Venture On December 21, 2015, the Company, through wholly-owned subsidiaries, entered into the Limited Liability Company Agreement of 3032 Wilshire Investors, LLC (the “Wilshire Joint Venture Agreement”) to form a joint venture (the “Wilshire Joint Venture”) with 3032 Wilshire SM, LLC, a subsidiary of Cadence (together with the Company, the “Wilshire Members”). On December 14, 2015 and January 5, 2016, the Company paid deposits in the amounts of $0.5 million and $0.1 million , respectively, toward the acquisition of certain property located at 3032 Wilshire Boulevard and 1210 Berkeley Street in Santa Monica, California (the “Wilshire Property”). On March 7, 2016, the Company contributed $5.7 million to the Wilshire Joint Venture. In May 2016, the Company made an additional capital contribution of $0.3 million to the Wilshire Joint Venture. In January 2017, February 2017 and August 2017, the Company made three additional contributions of $0.3 million , $0.6 million and $0.7 million , respectively, to the Wilshire Joint Venture. The Wilshire Joint Venture Agreement provides for the ownership and operation of certain real property by the Wilshire Joint Venture, in which the Company owns a 100% capital interest and a 50% profits interest. On March 8, 2016, the Wilshire Joint Venture used the deposits and capital contribution of the Company, together with the proceeds of a loan in the amount of $8.5 million , to acquire the Wilshire Property from a third-party seller, for a total purchase price of $13.5 million . The Wilshire Joint Venture is repositioning, and intends to re-lease, the existing improvements on the property. Pursuant to the Wilshire Joint Venture Agreement, 3032 Wilshire SM manages and conducts the day-to-day operations and affairs of the Wilshire Joint Venture, subject to certain major decisions set forth in the Wilshire Joint Venture Agreement that require the consent of all the Wilshire Members. The Company has the power to direct the activities of the Wilshire Joint Venture through its approval process of the activities that most significantly impact the economic performance of the Wilshire Joint Venture. Such activities include the budgeting, leasing, financings, and ultimately, the sale of the property. Income, losses and distributions are generally allocated based on the Wilshire Members’ respective capital and profits interests. Through the Company’s commitment to contribute 100% of capital to develop and operate the property through the life of the Wilshire Joint Venture, the Company has an obligation to absorb losses of the Wilshire Joint Venture. Additionally, in certain circumstances described in the Wilshire Joint Venture Agreement, the Company may be required to make additional capital contributions to the Wilshire Joint Venture, in proportion to the Wilshire Members’ respective ownership interests. Until the Company has received back its capital contribution and specified preferred returns, all distributions go to the Company; thereafter, the Wilshire Joint Venture will distribute the profits 50% to the Company and 50% to 3032 Wilshire SM. Additionally, the Company has the ability to buy out 3032 Wilshire SM upon certain conditions per the Operating Agreement. The following reflects the aggregate assets and liabilities of the Gelson’s Joint Venture and the Wilshire Joint Venture, which were consolidated by the Company, as of December 31, 2017 and 2016 (amounts in thousands): December 31, 2017 2016 ASSETS Properties under development and development costs: Land $ 25,851 $ 25,851 Buildings 585 601 Development costs 9,609 4,377 Properties under development and development costs 36,045 30,829 Restricted cash 818 1,666 Cash and cash equivalents 281 334 Prepaid expenses and other assets, net 9 14 Tenant receivables, net — 1 TOTAL ASSETS (1) $ 37,153 $ 32,844 LIABILITIES Notes payable, net (2) $ 19,116 $ 19,103 Accounts payable and accrued expenses 478 806 Amounts due to affiliates 9 9 Other liabilities 9 27 TOTAL LIABILITIES $ 19,612 $ 19,945 (1) The assets of the Gelson’s Joint Venture and Wilshire Joint Venture can be used only to settle obligations of the respective consolidated joint ventures. (2) As of both December 31, 2017 and 2016 , includes reclassification of approximately $0.1 million of deferred financing costs, net, as a contra-liability. The creditors of the consolidated joint ventures do not have recourse to the general credit of the Company. The notes payable of the consolidated joint ventures are not guaranteed by the Company. |
FUTURE MINIMUM RENTAL INCOME
FUTURE MINIMUM RENTAL INCOME | 12 Months Ended |
Dec. 31, 2017 | |
Operating Leases, Future Minimum Payments Receivable [Abstract] | |
FUTURE MINIMUM RENTAL INCOME | FUTURE MINIMUM RENTAL INCOME Operating Leases The Company’s real estate properties are leased to tenants under operating leases for which the terms and expirations vary. As of December 31, 2017 , the leases at the Company’s properties have remaining terms (excluding options to extend) of up to 14 years with a weighted-average remaining term (excluding options to extend) of approximately seven years. The leases may have provisions to extend the lease agreements, options for early termination after paying a specified penalty, rights of first refusal to purchase the property at competitive market rates, and other terms and conditions as negotiated. The Company retains substantially all of the risks and benefits of ownership of the real estate assets leased to tenants. Generally, upon the execution of a lease, the Company requires security deposits from tenants in the form of a cash deposit and/or a letter of credit. Amounts required as security deposits vary depending upon the terms of the respective leases and the creditworthiness of the tenant, but generally are not significant amounts. Therefore, exposure to credit risk exists to the extent that a receivable from a tenant exceeds the amount of its security deposit. Security deposits received in cash related to tenant leases are included in other liabilities in the accompanying consolidated balance sheets and totaled approximately $0.2 million as of both December 31, 2017 and 2016 . As of December 31, 2017 , the future minimum rental income from the Company’s properties under non-cancelable operating leases, excluding properties classified as held for sale, was as follows (amounts in thousands): 2018 $ 2,549 2019 2,619 2020 2,454 2021 2,213 2022 2,230 Thereafter 9,555 Total $ 21,620 |
LEASE INTANGIBLES AND BELOW-MAR
LEASE INTANGIBLES AND BELOW-MARKET LEASE LIABILITIES | 12 Months Ended |
Dec. 31, 2017 | |
Finite-Lived Intangible Assets, Net [Abstract] | |
ACQUIRED LEASE INTANGIBLES AND BELOW-MARKET LEASE LIABILITIES | LEASE INTANGIBLES AND BELOW-MARKET LEASE LIABILITIES, NET As of December 31, 2017 and 2016 , the Company’s acquired lease intangibles and below-market lease liabilities were as follows (amounts in thousands): Lease Intangibles Below-Market Lease Liabilities December 31, December 31, December 31, December 31, Cost $ 2,783 $ 7,000 $ (571 ) $ (3,904 ) Accumulated amortization (722 ) (3,175 ) 133 855 Total $ 2,061 $ 3,825 $ (438 ) $ (3,049 ) The Company’s amortization of lease intangibles and below-market lease liabilities for the years ended December 31, 2017 and 2016 , were as follows (amounts in thousands): Lease Intangibles Below-Market Lease Liabilities Year Ended Year Ended 2017 2016 2017 2016 Amortization $ (853 ) $ (942 ) $ 196 $ 279 The scheduled future amortization of lease intangibles and below-market lease liabilities, as of December 31, 2017 , was as follows (amounts in thousands): Lease Intangibles Below-Market Lease Intangibles 2018 $ 323 $ (67 ) 2019 302 (63 ) 2020 259 (53 ) 2021 213 (37 ) 2022 212 (37 ) Thereafter 752 (181 ) Total $ 2,061 $ (438 ) |
NOTES PAYABLE, NET
NOTES PAYABLE, NET | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
NOTES PAYABLE | NOTES PAYABLE, NET As of December 31, 2017 and 2016 , the Company’s notes payable, net, excluding a portion of the line of credit balance and term loan balance, which have been classified as held for sale, consisted of the following (amounts in thousands): Principal Balance Interest Rates At December 31, 2017 December 31, 2016 December 31, 2017 Line of credit (1) $ 23,107 $ 11,150 2.66 % Secured term loan — 24,277 — % Mortgage loans secured by properties under development (2) 19,200 19,200 9.5% - 10.0% Deferred financing costs, net (3) (84 ) (323 ) n/a $ 42,223 $ 54,304 (1) The Company’s line of credit is a revolving credit facility with an initial maximum aggregate commitment of $30.0 million . Effective February 15, 2017, the Company’s line of credit was refinanced to increase the maximum aggregate commitment under the credit facility from $30.0 million to $60.0 million . The credit facility matures on February 15, 2020 . Each loan made pursuant to the credit facility will be either a LIBOR rate loan or a base rate loan, at the election of the Company, plus an applicable margin, as defined. Monthly payments are interest only with the entire principal balance and all outstanding interest due at maturity. The Company will pay the lender an unused commitment fee, quarterly in arrears, which will accrue at 0.30% per annum, if the usage under the the Company’s line of credit is less than or equal to 50% of the line of credit amount, and 0.20% per annum if the usage under the Company’s line of credit is greater than 50% of the line of credit amount. The Company is providing a guaranty of all of its obligations under the Company’s line of credit and all other loan documents. As of December 31, 2017 , the Company’s line of credit was secured by Topaz Marketplace, 8 Octavia Street, 400 Grove Street, the Fulton Shops, 450 Hayes, 388 Fulton, Silver Lake, Florissant Marketplace, Ensenada Square and The Shops at Turkey Creek. As of December 31, 2016, the Company’s line of credit was secured by Pinehurst Square East, Topaz Marketplace, 8 Octavia Street, 400 Grove Street, the Fulton Shops and 450 Hayes. For information regarding recent draws under the Company’s line of credit, see “– Recent Financing Transactions The Company’s Line of Credit” below. (2) Comprised of $10.7 million and $8.5 million associated with the Company’s investment in the Gelson’s Joint Venture and the Wilshire Joint Venture, respectively. (3) Reclassification of deferred financing costs, net of accumulated amortization, as a contra-liability. During the years ended December 31, 2017 and 2016 , the Company incurred and expensed approximately $1.8 million and $2.2 million , respectively, of interest costs, which included the amortization of deferred financing costs of approximately $0.5 million for both periods. Also during the years ended December 31, 2017 and 2016 , the Company incurred and capitalized approximately $3.4 million and $2.8 million , respectively, of interest expense related to the variable interest entities, which included the amortization of deferred financing costs of approximately $0.5 million and $0.6 million for each period, respectively. As of December 31, 2017 and 2016 , interest expense payable was approximately $0.3 million and $0.4 million , respectively, including an amount related to the variable interest entities of approximately $0.2 million for each period. The following is a schedule of future principal payments for all of the Company’s notes payable outstanding as of December 31, 2017 (amounts in thousands): 2018 $ 19,200 2019 — 2020 33,856 Total (1) $ 53,056 (1) Total future principal payments reflect actual amounts due to creditors, and excludes reclassification of $0.1 million deferred financing costs, net. Recent Financing Transactions Line of Credit During the years ended December 31, 2017 and 2016 , the following transactions occurred under the Company’s line of credit: Year ended December 31, 2017 : • On January 4, 2017, the Company drew $4.0 million and used the proceeds to acquire 388 Fulton. • On January 6, 2017, the Company consummated the disposition of Pinehurst Square East, located in Bismarck, North Dakota, for a sales price of approximately $19.2 million in cash, $18.4 million of which was used to pay down the Company’s line of credit. • On January 11, 2017, the Company drew $11.0 million and used the proceeds to acquire Silver Lake. • On January 27, 2017, the Company drew $1.0 million and used the proceeds for working capital. • On February 28, 2017, the Company drew $9.8 million and used the proceeds to pay off the mortgage loan related to Woodland West Marketplace. • On February 28, 2017, the Company drew $0.6 million and used the proceeds to pay certain costs for the refinancing of the Company’s line of credit. • On March 29, 2017, the Company drew $1.0 million and used the proceeds for working capital. • On April 17, 2017, the Company consummated the disposition of Woodland West Marketplace, located in Arlington, Texas, for a sales price of approximately $14.6 million in cash, $13.7 million of which was used to pay down the Company’s line of credit. • On June 28, 2017, the Company drew $1.3 million and used the proceeds for working capital. • On August 22, 2017, the Company drew $1.0 million and used the proceeds for working capital. • On October 31, 2017, the Company drew $26.0 million and used the proceeds to repay the existing secured financing that encumbered the following properties: The Shops at Turkey Creek, Morningside Marketplace, Florissant Marketplace, Ensenada Square and Cochran Bypass. The total amount of the repayment was $25.4 million , which included a payment of yield maintenance due upon prepayment of $1.4 million . In connection with that borrowing, the Company added the following property as additional collateral security under the terms of the Amended and Restated Credit Facility: The Shops at Turkey Creek, Morningside Marketplace, Florissant Marketplace and Ensenada Square. • On October 31, 2017, the Company consummated the disposition of Cochran Bypass, located in Chester, South Carolina, for a sales price of approximately $2.5 million in cash, $2.1 million of which was used to pay down the Company’s line of credit. • On November 1, 2017, the Company consummated the disposition of Morningside Marketplace, located in Fontana, California, for a sales price of approximately $12.7 million in cash, $12.0 million of which was used to pay down the Company’s line of credit. • On November 20, 2017, the Company paid down $4.0 million on its line of credit. • On December 14, 2017, the Company drew $5.0 million and used a portion of the proceeds to repay a $2.5 million working capital short-term loan (the “Bridge Loan”) from Glenborough Property Partners, LLC, an affiliate of the Advisor. Year ended December 31, 2016 : • On March 7, 2016, the Company drew $6.0 million and used the proceeds to invest in the Wilshire Joint Venture. • On April 4, 2016, the Company consummated the disposition of Bloomingdale Hills, located in Riverside, Florida, for a sales price of approximately $9.2 million in cash, $3.0 million of which was used to pay down the line of credit. • On June 9, 2016, the Company drew $7.5 million and used the majority of the proceeds to acquire 8 Octavia and 400 Grove. • On July 25, 2016, the Company drew $4.7 million and used the majority of the proceeds to acquire the Fulton Shops. • On September 29, 2016, the Company drew $1.0 million and used the proceeds for working capital. • On October 7, 2016, the Company paid down $2.0 million on its line of credit. • On December 22, 2016, the Company drew $7.2 million and used the proceeds to acquire 450 Hayes. Refer to Note 3. “Real Estate Investments” for additional information. • On December 27, 2016, the Company drew $2.0 million to be used for working capital. Mortgage Loans Secured by Properties Under Development In connection with the Company’s investment in the Wilshire Joint Venture and the acquisition of the Wilshire Property, the Company has consolidated borrowings of $8.5 million (the “Wilshire Loan”). The Wilshire Loan bears interest at a rate of 10.0% per annum, payable monthly, commencing on April 1, 2016. The loan was scheduled to mature on March 7, 2017, with an option for two additional six-month periods, subject to certain conditions as stated in the loan agreement. All conditions to extensions were met, and on March 7, 2017, the Company exercised the option to extend the loan until September 7, 2017 . On August 29, 2017, the Company exercised the remaining option to extend the loan for an additional six months. The extension was scheduled to mature on March 7, 2018. The Company extended the loan, with the same terms, for an additional six months, effective March 7, 2018. The new maturity date is September 7, 2018 . The loan is secured by, among other things, a lien on the Wilshire development project and other collateral as defined in the loan agreement. In connection with the Company’s investment in the Gelson’s Joint Venture and the acquisition of the Gelson’s Property, the Company has consolidated borrowings of $10.7 million (the “Gelson’s Loan”). The Gelson’s Loan bears interest at a rate of 9.5% per annum, payable monthly, commencing on April 1, 2016. The loan was scheduled to mature on January 27, 2017 , with an option to extend for an additional six-month period, subject to certain conditions as stated in the loan agreement. Those conditions were not met, but the Company negotiated a six month extension of the term on January 27, 2017 to mature on July 27, 2017. The Company negotiated a nine month extension of the term on July 27, 2017. The new maturity date is April 27, 2018 . The loan is secured by, among other things, a lien on the Gelson’s development project and other joint venture collateral as defined in the loan agreement. The Company is working on extending the Gelson’s Loan, and intends to complete this extension prior to the loan’s maturity date. |
FAIR VALUE DISCLOSURES
FAIR VALUE DISCLOSURES | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE DISCLOSURES | FAIR VALUE DISCLOSURES The Company believes the total carrying values reflected on its consolidated balance sheets for cash and cash equivalents, restricted cash, accounts receivable, accounts payable and accrued expenses, amounts due to affiliates, mortgage loans secured by properties under development, and the Company’s line of credit reasonably approximate their fair values due to their short-term nature. The fair value of the Company’s notes payable is estimated using a present value technique based on contractual cash flows and management’s observations of current market interest rates for instruments with similar characteristics, including remaining loan term, loan-to-value ratio, type of collateral and other credit enhancements. The Company significantly reduces the amount of judgment and subjectivity in its fair value determination through the use of cash flow inputs that are based on contractual obligations. Discount rates are determined by observing interest rates published by independent market participants for comparable instruments. The Company classifies these inputs as Level 2 inputs. The following table provides the carrying values and fair values of the Company’s notes payable as of December 31, 2017 and 2016 (amounts in thousands): Carrying Value (1) Fair Value (1) (2) December 31, December 31, December 31, December 31, Notes payable, net $ 42,223 $ 54,304 $ 42,223 $ 54,781 (1) The carrying value of the Company’s notes payable represents the outstanding principal as of December 31, 2017 , and 2016 . The carrying values and fair values of the notes payable include the reclassification of deferred financing costs, net, of approximately $0.1 million and $0.3 million , respectively, as a contra-liability, as of December 31, 2017 and 2016 . (2) The estimated fair value of the notes payable is based upon the indicative market prices of the Company’s notes payable based on prevailing market interest rates. As part of the Company’s ongoing evaluation of the Company’s real estate portfolio, the Company estimates the fair value of its investments in real estate by obtaining outside independent appraisals on all of the properties. The appraised values are compared with the carrying values of its real estate portfolio to determine if there are indications of impairment. For both the years ended December 31, 2017 and 2016 , the Company did not record any impairment losses. |
EQUITY
EQUITY | 12 Months Ended |
Dec. 31, 2017 | |
Stockholders' Equity Note [Abstract] | |
EQUITY | EQUITY Common Stock Under the Company’s Articles of Amendment and Restatement (the “Charter”), the Company has the authority to issue 400,000,000 shares of common stock. All shares of common stock have a par value of $0.01 per share. On February 7, 2013, the Company terminated the Offering and ceased offering its securities. The Company sold 10,688,940 shares of common stock in its primary offering for gross operating proceeds of $104.7 million , 391,182 shares of common stock under the distribution reinvestment plan (“DRIP”) for gross offering proceeds of $3.6 million , granted 50,000 shares of restricted stock and issued 273,729 common shares to pay a portion of a special distribution on November 4, 2015. Cumulatively, through December 31, 2017, the Company has redeemed 612,115 shares sold in the Offering and/or the DRIP for $4.6 million . Common Units of the OP The Company’s prior advisor, TNP Strategic Retail Advisor, LLC, invested $1 thousand in the OP in exchange for Common Units of the OP which were sold to GPP on January 24, 2014. On May 26, 2011, in connection with the acquisition of Pinehurst Square East, a retail property located in Bismarck, North Dakota, the OP issued 287,472 Common Units to certain of the sellers of Pinehurst Square East who elected to receive Common Units for an aggregate value of approximately $2.6 million , or $9.00 per Common Unit. On March 12, 2012, in connection with the acquisition of Turkey Creek, a retail property located in Knoxville, Tennessee, the OP issued 144,324 Common Units to certain of the sellers of Turkey Creek who elected to receive Common Units for an aggregate value of approximately $1.4 million , or $9.50 per Common Unit. During the year ended December 31, 2017 , in response to anticipated taxable income allocations to OP Unit holders who acquired their OP Units as a part of their contribution of Pinehurst Square East, certain holders of Common Units of the OP elected to convert their common units of the OP into the Company’s common shares on a one-for-one basis. As a result, 187,114 Common Units were converted to common shares for an aggregate basis of approximately $0.9 million . On June 21, 2016, 9,588 OP units were converted into the Company’s common shares on a one-for-one basis for an aggregate value of approximately $52 thousand . Pursuant to the Advisory Agreement, in April 2014 the Company caused the OP to issue to the Advisor a separate series of limited partnership interests of the OP in exchange for a capital contribution to the OP of $1 thousand (the “Special Units”). The terms of the Special Units entitle the Advisor to (i) 15% of the Company’s net sale proceeds upon disposition of its assets after the Company’s stockholders receive a return of their investment plus a 7% cumulative, non-compounded rate of return or (ii) an equivalent amount in the event that the Company lists its shares of common stock on a national securities exchange or upon certain terminations of the Advisory Agreement after the Company’s stockholders are deemed to have received a return of their investment plus a 7% cumulative, non-compounded rate of return. The holders of Common Units, other than the Company and the holder of the Special Units, generally have the right to cause the OP to redeem all or a portion of their Common Units for, at the Company’s sole discretion, shares of the Company’s common stock, cash or a combination of both. If the Company elects to redeem Common Units for shares of common stock, the Company will generally deliver one share of common stock for each Common Unit redeemed. Holders of Common Units, other than the Company and the holders of the Special Units, may exercise their redemption rights at any time after one year following the date of issuance of their Common Units; provided, however, that a holder of Common Units may not deliver more than two redemption notices in a single calendar year and may not exercise a redemption right for less than 1,000 Common Units, unless such holder holds less than 1,000 Common Units, in which case, it must exercise its redemption right for all of its Common Units. Preferred Stock The Charter authorizes the Company to issue 50,000,000 shares of $0.01 par value preferred stock. As of December 31, 2017 and 2016, no shares of preferred stock were issued and outstanding. Share Redemption Program On April 1, 2015, the Company’s board of directors approved the reinstatement of the share redemption program (which had been suspended since January 15, 2013) and adopted an Amended and Restated Share Redemption Program (the “SRP”). Under the SRP, only shares submitted for repurchase in connection with the death or “qualifying disability” (as defined in the SRP) of a stockholder are eligible for repurchase by the Company. The number of shares to be redeemed is limited to the lesser of (i) a total of $2.0 million for redemptions sought upon a stockholder’s death and a total of $1.0 million for redemptions sought upon a stockholder’s qualifying disability, and (ii) 5% of the weighted-average number of shares of the Company’s common stock outstanding during the prior calendar year. Share repurchases pursuant to the SRP are made at the sole discretion of the Company. The Company reserves the right to reject any redemption request for any reason or no reason or to amend or terminate the share redemption program at any time subject to the notice requirements in the SRP. The redemption price for shares that are redeemed is 100% of the Company’s most recent estimated net asset value per share as of the applicable redemption date. A redemption request must be made within one year after the stockholder’s death or disability, unless such death or disability occurred between January 15, 2013 and April 1, 2015, when the share redemption program was suspended. Redemption requests due to the death or disability of a Company stockholder that occurred during such time period, were required to be submitted on or before April 1, 2016. The SRP provides that any request to redeem less than $5 thousand worth of shares will be treated as a request to redeem all of the stockholder’s shares. If the Company cannot honor all redemption requests received in a given quarter, all requests, including death and disability redemptions, will be honored on a pro rata basis. If the Company does not completely satisfy a redemption request in one quarter, it will treat the unsatisfied portion as a request for redemption in the next quarter when funds are available for redemption, unless the request is withdrawn. The Company may increase or decrease the amount of funding available for redemptions under the SRP on ten business days’ notice to stockholders. Shares submitted for redemption during any quarter will be redeemed on the penultimate business day of such quarter. The record date for quarterly distributions has historically been and is expected to continue to be the last business day of each quarter; therefore, shares that are redeemed during any quarter are expected to be redeemed prior to the record date and thus would not be eligible to receive the distribution declared for such quarter. The other material terms of the SRP are consistent with the terms of the share redemption program that was in effect immediately prior to January 15, 2013. On August 7, 2015, the board of directors approved the amendment and restatement of the SRP (the “First A&R SRP”). Under the First A&R SRP, the redemption date with respect to third quarter 2015 redemptions was November 10, 2015 or the next practicable date as the Chief Executive Officer determined so that redemptions with respect to the third quarter of 2015 were delayed until after the payment date for a special distribution. With this revision, stockholders who were to have 100% of their shares redeemed were not left holding a small number of shares from the Special Distribution after the date of the redemption of their shares. The other material terms of the First A&R SRP were consistent with the terms of the SRP. On August 10, 2016, the board of directors authorized management of the Company to prepare and implement an amendment and restatement of the SRP (the “Second A&R SRP”) to revise the definition of disability under the SRP. The Second A&R SRP became effective August 26, 2016. Under the Second A&R SRP, a person is deemed to be disabled and therefore eligible to redeem shares pursuant to the Second A&R SRP if they are disabled pursuant to the definition of “disability” in the Internal Revenue Code of 1986, as amended, at the time that the person’s written redemption request is received by the Company. The other material terms of the Second A&R SRP are consistent with the terms of the First A&R SRP. On October 5, 2016, the board of directors approved, pursuant to Section 3(a) of the SRP, an additional $0.5 million of funds available for the redemption of shares in connection with the death of a stockholder. On August 2, 2017, the board of directors of the Company approved, pursuant to Section 3(a) of the SRP, an additional $1.0 million of funds available for the redemption of shares in connection with the death of a stockholder. The following table summarizes share redemption activity during the years ended December 31, 2017 and 2016 (amounts in thousands, except shares): Year Ended 2017 2016 Shares of common stock redeemed 136,921 109,291 Purchase price $ 865 $ 704 As stated above, cumulatively, through December 31, 2017 , the Company has redeemed 612,115 shares sold in the Offering and/or its dividend reinvestment plan for $4.6 million . Quarterly Distributions In order to qualify as a REIT, the Company is required to distribute at least 90% of its annual REIT taxable income, subject to certain adjustments, to its stockholders. Some or all of the Company’s distributions have been paid, and in the future may continue to be paid from sources other than cash flows from operations. Under the terms of the amended Key Bank credit facility, the Company may pay distributions to its investors so long as the total amount paid does not exceed 100% of the cumulative Adjusted Funds From Operations plus up to an additional $2.0 million of the Company’s net proceeds from property dispositions, as defined in the amended Company’s line of credit; provided, however, that the Company is not restricted from making any distributions necessary in order to maintain its status as a REIT. The Company’s board of directors evaluates the Company’s ability to make quarterly distributions based on the Company’s operational cash needs. The following tables set forth the quarterly distributions declared to the Company’s common stockholders and Common Unit holders for the years ended December 31, 2017 , and 2016 (amounts in thousands, except per share amounts): Distribution Record Date Distribution Payable Date Distribution Per Share of Common Stock / Common Unit Total Common Stockholders Distribution Total Common Unit Holders Distribution Total Distribution First Quarter 2017 3/31/2017 4/28/2017 $ 0.06 $ 655 $ 25 $ 680 Second Quarter 2017 6/30/2017 7/31/2017 0.06 652 25 677 Third Quarter 2017 9/30/2017 10/31/2017 0.06 660 16 676 Fourth Quarter 2017 12/31/2017 1/31/2018 0.06 659 14 673 Total $ 2,626 $ 80 $ 2,706 Distribution Record Date Distribution Payable Date Distribution Per Share of Common Stock / Common Unit Total Common Stockholders Distribution Total Common Unit Holders Distribution Total Distribution First Quarter 2016 3/31/2016 4/29/2016 $ 0.06 $ 660 $ 26 $ 686 Second Quarter 2016 7/7/2016 7/29/2016 0.06 661 25 686 Third Quarter 2016 9/30/2016 10/31/2016 0.06 659 25 684 Fourth Quarter 2016 12/30/2016 1/31/2017 0.06 656 25 681 Total $ 2,636 $ 101 $ 2,737 |
EARNINGS PER SHARE
EARNINGS PER SHARE | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | EARNINGS PER SHARE EPS is computed by dividing net income (loss) attributable to common stockholders by the weighted average number of common shares outstanding during each period. Diluted EPS is computed after adjusting the basic EPS computation for the effect of potentially dilutive securities outstanding during the period. The effect of non-vested shares, if dilutive, is computed using the treasury stock method. The Company applies the two-class method for determining EPS as its outstanding shares of non-vested restricted stock are considered participating securities as dividend payments are not forfeited even if the underlying award does not vest. There was no unvested stock as of December 31, 2017 . The Company’s excess of distributions over earnings related to participating securities are shown as a reduction in income (loss) attributable to common stockholders in the Company’s computation of EPS. The following table sets forth the computation of the Company’s basic and diluted earnings (loss) per share for the years ended December 31, 2017 and 2016 (amounts in thousands, except shares and per share amounts): Year Ended 2017 2016 Numerator - basic and diluted Net income (loss) $ 8,856 $ (1,991 ) Net income (loss) attributable to non-controlling interests 295 (75 ) Net income (loss) attributable to common shares $ 8,561 $ (1,916 ) Denominator - basic and diluted Basic weighted average common shares 10,936,361 11,006,759 Common Units (1) — — Diluted weighted average common shares 10,936,361 11,006,759 Earnings (loss) per common share - basic and diluted Net earnings (loss) attributable to common shares $ 0.78 $ (0.17 ) (1) The effect of 235,194 convertible Common Units pursuant to the redemption rights outlined in the Company’s registration statement on Form S-11 have not been included as they would not be dilutive. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2017 | |
Related Party Transaction, Due from (to) Related Party [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS On August 7, 2013, the Company entered into the Advisory Agreement with the Advisor. On July 25, 2017, the Advisory Agreement with the Advisor was renewed for an additional 12 months, beginning on August 10, 2017. The Advisor manages the Company’s business as the Company’s external advisor pursuant to the Advisory Agreement. Pursuant to the Advisory Agreement, the Company will pay the Advisor specified fees for services related to the investment of funds in real estate and real estate-related investments, management of the Company’s investments and for other services. On March 11, 2015, the Company, through a wholly-owned subsidiary, entered into the Limited Liability Company Agreement of SGO Retail Acquisitions Venture, LLC to form the SGO Joint Venture. On September 30, 2015, the Company, through wholly-owned subsidiaries, entered into the Limited Liability Company Agreement of SGO MN Retail Acquisitions Venture, LLC to form the SGO MN Joint Venture. For additional information regarding the SGO Joint Venture and the SGO MN Joint Venture, refer to Note 4. “Investments in Unconsolidated Joint Ventures.” Although paid in full on December 14, 2017, on September 27, 2017, the Company, through the OP, entered into a $2.5 million Bridge Loan with Glenborough Property Partners, LLC, an affiliate of the Advisor. The Bridge Loan was scheduled to mature on March 31, 2018, at which point the outstanding balance of the principal and all accrued and unpaid interest would be due and payable. The Bridge loan incurred interest at an adjustable rate equal to the KeyBank prime rate. Interest was payable monthly in arrears. The Company had the right to prepay the Bridge Loan at any time in whole or in part without premium or penalty. There were no other loan fees or financing coordination fees paid or payable in connection with this loan. During the year ended December 31, 2017 , the Company incurred $23 thousand of interest expense related to the Bridge Loan. Summary of Related Party Fees The following table sets forth the Advisor related party costs incurred and payable by the Company for the periods presented (amounts in thousands): Incurred Payable as of Year Ended December 31, Expensed 2017 2016 2017 2016 Acquisition fees $ — $ 184 $ — $ 80 Asset management fees 868 902 — — Reimbursement of operating expenses 231 197 — — Property management fees 350 420 21 2 Disposition fees 589 203 — 29 Total $ 2,038 $ 1,906 $ 21 $ 111 Capitalized Acquisition fees $ 194 $ 275 $ — $ — Leasing fees 222 205 — — Legal leasing fees 95 78 — — Construction management fees 42 4 — — Financing coordination fees 814 — — — Total $ 1,367 $ 562 $ — $ — Acquisition Fees Under the Advisory Agreement, the Advisor is entitled to receive an acquisition fee equal to 1% of (1) the cost of each investment acquired directly by the Company or (2) the Company’s allocable cost of an investment acquired pursuant to a joint venture, in each case including purchase price, acquisition expenses and any debt attributable to such investments. An acquisition fee is capitalized by the Company when the related transaction does not qualify as a business combination; otherwise an acquisition fee is expensed. Origination Fees Under the Advisory Agreement, the Advisor is entitled to receive an origination fee equal to 1% of the amount funded by the Company to acquire or originate real estate-related loans, including any acquisition expenses related to such investment and any debt used to fund the acquisition or origination of the real estate-related loans. The Company will not pay an origination fee to the Advisor with respect to any transaction pursuant to which it is required to pay the Advisor an acquisition fee. Financing Coordination Fees Under the Advisory Agreement, the Advisor is entitled to receive a financing coordination fee equal to 1% of the amount made available and/or outstanding under any (1) financing obtained or assumed, directly or indirectly, by the Company or the OP and used to acquire or originate investments, or (2) the refinancing of any financing obtained or assumed, directly or indirectly, by the Company or the OP. Asset Management Fees Under the Advisory Agreement, the Advisor is entitled to receive an asset management fee equal to a monthly fee of one-twelfth (1/12th) of 0.6% of the higher of (1) aggregate cost on a GAAP basis (before non-cash reserves and depreciation) of all investments the Company owns, including any debt attributable to such investments, or (2) the fair market value of the Company’s investments (before non-cash reserves and depreciation) if the board of directors has authorized the estimate of a fair market value of the Company’s investments; provided, however, that the asset management fee will not be less than $250,000 in the aggregate during any one calendar year. Reimbursement of Operating Expenses The Company reimburses the Advisor for all expenses paid or incurred by the Advisor in connection with the services provided to the Company, subject to the limitation that the Company will not reimburse the Advisor for any amount by which the Company’s total operating expenses (including the asset management fee described below) at the end of the four preceding fiscal quarters exceeded the greater of (1) 2% of its average invested assets (as defined in the Company’s Articles of Amendment and Restatement (the “Charter”)); or (2) 25% of its net income (as defined in the Charter) determined without reduction for any additions to depreciation, bad debts or other similar non-cash expenses and excluding any gain from the sale of the Company’s assets for that period (the “2%/25% Guideline”). The Advisor is required to reimburse the Company quarterly for any amounts by which total operating expenses exceed the 2%/25% Guideline in the previous expense year that the independent directors do not approve. The Company will not reimburse the Advisor for any of its personnel costs or other overhead costs except for customary reimbursements for personnel costs under property management agreements entered into between the OP and the Advisor or its affiliates. Notwithstanding the above, the Company may reimburse the Advisor for expenses in excess of the 2%/25% Guideline if a majority of the independent directors determine that such excess expenses are justified based on unusual and non-recurring factors. For the years ended December 31, 2017 and 2016 , the Company’s total operating expenses (as defined in the Charter) did not exceed the 2%/25% Guideline. Property Management Fees Under the property management agreements between the Company and Glenborough, Glenborough is entitled to receive property management fees calculated at a maximum of up to 4% of the properties’ gross revenue. The property management agreements with Glenborough have been renewed for an additional 12 months, beginning on August 10, 2017. Disposition Fees Under the Advisory Agreement, if the Advisor or its affiliates provide a substantial amount of services, as determined by the Company’s independent directors, in connection with the sale of a real property, the Advisor or its affiliates may be paid disposition fees up to 50% of a customary and competitive real estate commission, but not to exceed 3% of the contract sales price of each property sold. Leasing Fees Under the property management agreements, Glenborough is entitled to receive a separate fee for the leases of new tenants, and for expansions, extensions and renewals of existing tenants in an amount not to exceed the fee customarily charged by similarly situated parties rendering similar services in the same geographic area for similar properties. Legal Leasing Fees Under the property management agreements, Glenborough is entitled to receive a market-based legal leasing fee for the negotiation and production of new leases, renewals, and amendments. Construction Management Fees In connection with the construction or repair in or about a property, the property manager is responsible for coordinating and facilitating the planning and the performance of all construction and is entitled to receive a fee equal to 5% of the hard costs for the project in question. Related-Party Fees Paid by the Unconsolidated Joint Ventures The unconsolidated joint ventures are party to certain agreements with Glenborough for services related to the investment of funds and management of the joint ventures’ investments, as well as the day-to-day management, operation and maintenance of the properties owned by the joint ventures. The joint ventures pay fees to Glenborough for these services. For the years ended December 31, 2017 and 2016 , the SGO Joint Venture recognized related party fees and reimbursements of $0.2 million and $0.5 million , respectively. For the years ended December 31, 2017 and 2016 , the SGO MN Joint Venture recognized related party fees and reimbursements of $0.7 million and $1.0 million , respectively. The related-party amounts consist of property management, asset management, leasing commission, legal leasing, construction management fees and salary reimbursements. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Economic Dependency The Company is dependent on the Advisor and its affiliates for certain services that are essential to the Company, including the identification, evaluation, negotiation, purchase, and disposition of real estate and real estate-related investments, management of the daily operations of the Company’s real estate and real estate-related investment portfolio, and other general and administrative responsibilities. In the event that the Advisor is unable to provide such services to the Company, the Company will be required to obtain such services from other sources. Environmental As an owner of real estate, the Company is subject to various environmental laws of federal, state and local governments. The Company is not aware of any environmental liability that could have a material adverse effect on its consolidated financial condition or results of operations. However, changes in applicable environmental laws and regulations, the uses and conditions of properties in the vicinity of the Company’s properties, the activities of its tenants and other environmental conditions of which the Company is unaware with respect to the properties could result in future environmental liabilities. |
SUBSEQUENT EVENTS SUBSEQUENT EV
SUBSEQUENT EVENTS SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | SUBSEQUENT EVENTS Distributions On December 7, 2017, the Company’s board of directors declared a fourth quarter distribution in the amount of $0.06 per share/unit to common stockholders and holders of common units of record as of December 31, 2017. The distribution was paid on January 31, 2018. Mortgage Loans Secured by Properties Under Development On March 7, 2018, the Company extended the Wilshire loan for six months. The new maturity date is September 7, 2018. |
SCHEDULE III - REAL ESTATE OPER
SCHEDULE III - REAL ESTATE OPERATING PROPERTIES AND ACCUMULATED DEPRECIATION (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
SEC Schedule III, Real Estate and Accumulated Depreciation Disclosure [Abstract] | |
SEC Schedule III, Real Estate and Accumulated Depreciation Disclosure [Text Block] | STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III — REAL ESTATE OPERATING PROPERTIES AND ACCUMULATED DEPRECIATION December 31, 2017 (amounts in thousands) Initial Cost to Company Cost Capitalized Subsequent to Acquisition (1) Gross Amount of Which Carried at Close of Period Life on which Depreciation in Latest Statement of Operations is Computed (3) Land Building & Improvements Land Building & Improvements Total (2) Accumulated Depreciation Acquisition Date Topaz Marketplace $ 2,120 $ 10,724 $ (1,535 ) $ 1,900 $ 9,409 $ 11,309 $ (1,626 ) 9/23/2011 5-30 400 Grove Street 1,009 1,813 — 1,009 1,813 2,822 (91 ) 6/14/2016 5-30 8 Octavia Street 728 1,847 58 728 1,905 2,633 (93 ) 6/14/2016 5-30 Fulton Shops 1,187 3,254 — 1,187 3,254 4,441 (171 ) 7/27/2016 5-30 450 Hayes 2,324 5,009 367 2,324 5,376 7,700 (187 ) 12/22/2016 5-30 388 Fulton 1,109 2,943 319 1,112 3,259 4,371 (116 ) 1/4/2017 5-30 Silver Lake 5,747 6,646 364 5,760 6,997 12,757 (295 ) 1/11/2017 5-30 Total $ 14,224 $ 32,236 $ (427 ) $ 14,020 $ 32,013 $ 46,033 $ (2,579 ) (1) The cost capitalized subsequent to acquisition may include negative balances resulting from the write-off and impairment of real estate assets, and parcel sales. (2) The aggregate net tax basis of land and buildings for federal income tax purposes is $48.0 million . (3) Buildings and building improvements are depreciated over their useful lives as shown. Tenant improvements are amortized over the life of the related lease, which with our current portfolio can vary from 1 year to over 36 years. (in thousands) Year Ended December 31, 2017 2016 Real Estate: Balance at the beginning of the year $ 65,627 $ 75,815 Acquisitions 17,128 17,171 Improvements 746 67 Dispositions (13,511 ) (10,081 ) Balances associated with changes in reporting presentation (1) (23,957 ) (17,345 ) Balance at the end of the year $ 46,033 $ 65,627 Accumulated Depreciation: Balance at the beginning of the year $ 8,163 $ 10,068 Depreciation expense 2,047 2,515 Dispositions (2,453 ) (1,058 ) Balances associated with changes in reporting presentation (1) (5,178 ) (3,362 ) Balance at the end of the year $ 2,579 $ 8,163 (1) The balances associated with changes in reporting presentation represent real estate and accumulated depreciation reclassified as assets held for sale. |
SUMMARY OF SIGNIFICANT ACCOUN22
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Principles of Consolidation and Basis of Presentation | Principles of Consolidation and Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) as contained within the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) and the rules and regulations of the Securities and Exchange Commission (the “SEC”), including the instructions to Form 10-K and Regulation S-X. The consolidated financial statements include the accounts of the Company, the OP, their direct and indirect owned subsidiaries, and the accounts of joint ventures that are determined to be variable interest entities for which the Company is the primary beneficiary. All significant intercompany balances and transactions are eliminated in consolidation. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) necessary to present fairly the Company’s consolidated financial position, results of operations and cash flows have been included. The Company evaluates the need to consolidate joint ventures and variable interest entities based on standards set forth in ASC Topic 810, Consolidation (“ASC 810”). In determining whether the Company has a controlling interest in a joint venture or a variable interest entity and the requirement to consolidate the accounts of that entity, management considers factors such as ownership interest, authority to make decisions and contractual and substantive participating rights of the partners/members, as well as whether the entity is a variable interest entity for which the Company is the primary beneficiary. As of December 31, 2017 and 2016 , the Company held ownership interests in two unconsolidated joint ventures. Refer to Note 4. “Investments in Unconsolidated Joint Ventures” for additional information. As of December 31, 2017 and 2016 , the Company held variable interests in two variable interest entities and consolidated those entities. Refer to Note 5. “Variable Interest Entities” for additional information. |
Non-Controlling Interests | Non-Controlling Interests The Company’s non-controlling interests are comprised of common units in the OP (“Common Units”). The Company accounts for non-controlling interests in accordance with ASC 810. In accordance with ASC 810, the Company reports non-controlling interests in subsidiaries within equity in the consolidated financial statements, but separate from stockholders’ equity. Net income (loss) attributable to non-controlling interests is presented as a reduction from net income (loss) in calculating net income (loss) attributable to common stockholders on the consolidated statement of operations. Acquisitions or dispositions of non-controlling interests that do not result in a change of control are accounted for as equity transactions. In addition, ASC 810 requires that a parent company recognize a gain or loss in the Company’s results of operations when a subsidiary is deconsolidated upon a change in control. In accordance with ASC 480-10, Distinguishing Liabilities from Equity , non-controlling interests that are determined to be redeemable are carried at their fair value or redemption value as of the balance sheet date and reported as liabilities or temporary equity depending on their terms. The Company periodically evaluates individual non-controlling interests for the ability to continue to recognize the non-controlling interest as permanent equity in the consolidated balance sheets. Any non-controlling interest that fails to qualify as permanent equity will be reclassified as liabilities or temporary equity. All non-controlling interests at December 31, 2017 and 2016, qualified as permanent equity. |
Use of Estimates | Use of Estimates The preparation of the Company’s consolidated financial statements requires significant management judgments, assumptions and estimates about matters that are inherently uncertain. These judgments affect the reported amounts of assets and liabilities and the Company’s disclosure of contingent assets and liabilities at the dates of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting periods. With different estimates or assumptions, materially different amounts could be reported in the Company’s consolidated financial statements, and actual results could differ from the estimates or assumptions used by management. Additionally, other companies may utilize different estimates that may impact the comparability of the Company’s consolidated results of operations to those of companies in similar businesses. The Company considers significant estimates to include the carrying amounts and recoverability of investments in real estate, impairments, real estate acquisition purchase price allocations, allowance for doubtful accounts, estimated useful lives to determine depreciation and amortization and fair value determinations, among others. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents represent current bank accounts and other bank deposits free of encumbrances and having maturity dates of three months or less from the respective dates of deposit. The Company limits cash investments to financial institutions with high credit standing; therefore, the Company believes it is not exposed to any significant credit risk in cash. |
Restricted Cash | Restricted Cash Restricted cash includes escrow accounts for real property taxes, insurance, capital expenditures and tenant improvements, debt service and leasing costs held by lenders. |
Revenue Recognition | Revenue Recognition Revenues include minimum rents, expense recoveries and percentage rental payments. Minimum rents are recognized on an accrual basis over the terms of the related leases on a straight-line basis when collectability is reasonably assured and the tenant has taken possession or controls the physical use of the leased property. If the lease provides for tenant improvements, the Company determines whether the tenant improvements, for accounting purposes, are owned by the tenant or the Company. When the Company is the owner of the tenant improvements, the tenant is not considered to have taken physical possession or have control of the physical use of the leased asset until the tenant improvements are substantially completed. When the tenant is the owner of the tenant improvements, any tenant improvement allowance that is funded is treated as a lease incentive and amortized as a reduction of revenue over the lease term. Tenant improvement ownership is determined based on various factors including, but not limited to: • whether the lease stipulates how a tenant improvement allowance may be spent; • whether the amount of a tenant improvement allowance is in excess of market rates; • whether the tenant or landlord retains legal title to the improvements at the end of the lease term; • whether the tenant improvements are unique to the tenant or general-purpose in nature; and • whether the tenant improvements are expected to have any residual value at the end of the lease. For leases with minimum scheduled rent increases, the Company recognizes income on a straight-line basis over the lease term when collectability is reasonably assured. Recognizing rental income on a straight-line basis for leases results in recognized revenue amounts which differ from those that are contractually due from tenants on a cash basis. If the Company determines the collectability of straight-line rents is not reasonably assured, the Company limits future recognition to amounts contractually owed and paid, and, when appropriate, establishes an allowance for estimated losses. The Company maintains an allowance for doubtful accounts, including an allowance for straight-line rent receivables, for estimated losses resulting from tenant defaults or the inability of tenants to make contractual rent and tenant recovery payments. The Company monitors the liquidity and creditworthiness of its tenants on an ongoing basis. For straight-line rent amounts, the Company’s assessment is based on amounts estimated to be recoverable over the term of the lease. The Company’s straight-line rent receivable (not including receivables on property held for sale), which is included in tenant receivables, net, on the consolidated balance sheets, was approximately $0.5 million and $0.6 million at December 31, 2017 and 2016, respectively. Certain leases contain provisions that require the payment of additional rents based on the respective tenants’ sales volume (contingent or percentage rent) and substantially all contain provisions that require reimbursement of the tenants’ allocable real estate taxes, insurance and common area maintenance costs (“CAM”). Revenue based on percentage of tenants’ sales is recognized only after the tenant exceeds its sales breakpoint. Revenue from tenant reimbursements of taxes, insurance and CAM is recognized in the period that the applicable costs are incurred in accordance with the lease agreement. The Company recognizes gains or losses on sales of real estate in accordance with ASC 360, Property, Plant, and Equipment (“ASC 360”). Gains are not recognized and are deferred until (a) a sale has been consummated; (b) the buyer’s initial and continuing investments are adequate to demonstrate a commitment to pay for the property; (c) the Company’s receivable, if any, is not subject to future subordination; and (d) the Company has transferred to the buyer the usual risks and reward of ownership, and the Company does not have a substantial continuing involvement with the property. Deferred gain on the sale of properties to the SGO Joint Venture was approximately $0.7 million and $1.2 million , as of December 31, 2017 and 2016, respectively. |
Valuation of Accounts Receivable | Valuation of Accounts Receivable The Company makes estimates of the collectability of its tenant receivables related to base rents, including deferred rents receivable, expense reimbursements and other revenue or income. The Company analyzes tenant receivables, deferred rent receivable, historical bad debts, customer creditworthiness, current economic trends and changes in customer payment terms when evaluating the adequacy of the allowance for doubtful accounts. In addition, with respect to tenants in bankruptcy, the Company will make estimates of the expected recovery of pre-petition and post-petition claims in assessing the estimated collectability of the related receivable. In some cases, the ultimate resolution of these claims can exceed one year. When a tenant is in bankruptcy, the Company will record a bad debt reserve for the tenant’s receivable balance and generally will not recognize subsequent rental revenue until cash is received or until the tenant is no longer in bankruptcy and has the ability to make rental payments. |
Concentration of Credit Risk | Concentration of Credit Risk A concentration of credit risk arises in the Company’s business when a nationally or regionally-based tenant occupies a substantial amount of space in multiple properties owned by the Company. In that event, if the tenant suffers a significant downturn in its business, it may become unable to make its contractual rent payments to the Company, exposing the Company to potential losses in rental revenue, expense recoveries, and percentage rent. Generally, the Company does not obtain security deposits from the nationally-based or regionally-based tenants in support of their lease obligations to the Company. The Company regularly monitors its tenant base to assess potential concentrations of credit risk. As of December 31, 2017, excluding properties classified as held for sale, Clover Juice accounted for more than 10% of the Company’s annual minimum rent. As of December 31, 2017, there were no amounts outstanding from Clover Juice. As of December 31, 2016, excluding properties classified as held for sale, Ralph’s Grocery and Gold’s Gym , each accounted for more than 10% of the Company’s annual minimum rent. As of December 31, 2016, there were no amounts outstanding from either Ralph’s Grocery or Gold’s Gym. |
Business Combinations | Business Combinations The Company records the acquisition of income-producing real estate or real estate that will be used for the production of income as a business combination when the acquired property meets the definition of a business, as further discussed below. Assets acquired and liabilities assumed in a business combination are generally measured at their acquisition-date fair values, including tenant improvements and identifiable intangible assets or liabilities. Tenant improvements recognized represent the tangible assets associated with the existing leases valued on a fair value basis at the acquisition date. Tenant improvements are classified as assets under investments in real estate and are depreciated over the remaining lease terms. Identifiable intangible assets and liabilities relate to the value of in-place operating leases which come in three forms: (1) leasing commissions and legal costs, which represent the value associated with “cost avoidance” of acquiring in-place leases, such as lease commissions paid under terms generally experienced in markets in which the Company operates; (2) value of in-place leases, which represents the estimated loss of revenue and of costs incurred for the period required to lease the “assumed vacant” property to the occupancy level when purchased; and (3) above- or below-market value of in-place leases, which represents the difference between the contractual rents and market rents at the time of the acquisition, discounted for tenant credit risks. The value of in-place leases is recorded in acquired lease intangibles and amortized over the remaining lease term. Above- or below-market-rate leases are classified in acquired lease intangibles, or in acquired below-market lease intangibles, depending on whether the contractual terms are above- or below-market. Above-market leases are amortized as a decrease to rental revenue over the remaining non-cancelable terms of the respective leases and below-market leases are amortized as an increase to rental revenue over the remaining initial lease term and any fixed rate renewal periods, if applicable. Acquisition costs are expensed as incurred. Costs incurred in pursuit of targeted properties for acquisitions not yet closed or those determined to no longer be viable and costs incurred which are expected to result in future period disposals of property not currently classified as held for sale properties have been expensed and are also classified in the consolidated statements of operations as transaction expenses. Estimates of the fair values of the tangible assets, identifiable intangibles and assumed liabilities require the Company to make significant assumptions to estimate market lease rates, property operating expenses, carrying costs during lease-up periods, discount rates, market absorption periods, and the number of years the property will be held for investment. The use of inappropriate assumptions would result in an incorrect valuation of the Company’s acquired tangible assets, identifiable intangibles and assumed liabilities, which would impact the amount of the Company’s results of operations. These allocations also impact depreciation expense, amortization expense and gains or losses recorded on future sales of properties. |
Reportable Segments | Reportable Segments ASC 280, Segment Reporting , establishes standards for reporting financial and descriptive information about an enterprise’s reportable segments. The Company has one reportable segment, income-producing retail properties, which consists of activities related to investing in real estate. The retail properties are geographically diversified throughout the United States, and the Company evaluates operating performance on an overall portfolio level. |
Investments in Real Estate | Investments in Real Estate In January 2017, the FASB issued Accounting Standards Update (“ASU”) No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business (“ASU 2017-01”) that clarifies the framework for determining whether an integrated set of assets and activities meets the definition of a business. The revised framework establishes a screen for determining whether an integrated set of assets and activities is a business and narrows the definition of a business, which is expected to result in fewer transactions being accounted for as business combinations. Acquisitions of integrated sets of assets and activities that do not meet the definition of a business are accounted for as asset acquisitions. The Company elected to early adopt ASU 2017-01 for the reporting period beginning January 1, 2017. As a result of adopting ASU 2017-01, the Company’s acquisitions of properties beginning January 1, 2017, were evaluated under the new guidance. The acquisitions occurring during 2017 were determined to be asset acquisitions, as they did not meet the revised definition of a business. Evaluation of business combination or asset acquisition: The Company evaluates each acquisition of real estate to determine if the integrated set of assets and activities acquired meet the definition of a business and need to be accounted for as a business combination. If either of the following criteria is met, the integrated set of assets and activities acquired would not qualify as a business: • Substantially all of the fair value of the gross assets acquired is concentrated in either a single identifiable asset or a group of similar identifiable assets; or • The integrated set of assets and activities is lacking, at a minimum, an input and a substantive process that together significantly contribute to the ability to create outputs (i.e. revenue generated before and after the transaction). An acquired process is considered substantive if: • The process includes an organized workforce (or includes an acquired contract that provides access to an organized workforce), that is skilled, knowledgeable, and experienced in performing the process; • The process cannot be replaced without significant cost, effort, or delay; or • The process is considered unique or scarce. Generally, the Company expects that acquisitions of real estate will not meet the revised definition of a business because substantially all of the fair value is concentrated in a single identifiable asset or group of similar identifiable assets (i.e. land, buildings, and related intangible assets), or because the acquisition does not include a substantive process in the form of an acquired workforce or an acquired contract that cannot be replaced without significant cost, effort or delay. In asset acquisitions, the purchase consideration, including acquisition costs, is allocated to the individual assets acquired and liabilities assumed on a relative fair value basis. As a result, asset acquisitions do not result in the recognition of goodwill or a bargain purchase gain. Depreciation and amortization is computed using a straight-line method over the estimated useful lives of the assets as follows: Years Buildings and improvements 5 - 30 years Tenant improvements 1 - 36 years Tenant improvement costs recorded as capital assets are depreciated over the tenant’s remaining lease term, which the Company has determined approximates the useful life of the improvement. Expenditures for ordinary maintenance and repairs are expensed to operations as incurred. Significant renovations and improvements that improve or extend the useful lives of assets are capitalized. Acquisition costs related to asset acquisitions are capitalized in the consolidated balance sheets. For acquisitions of real estate prior to the adoption of ASU 2017-01, which were generally accounted for as business combinations, the Company recognized the assets acquired (including the intangible value of acquired above- or below-market leases, acquired in-place leases and other intangible assets or liabilities) at fair value as of the acquisition date. Acquisition costs related to the business combinations were expensed as incurred. |
Properties Under Development | Properties Under Development The initial cost of properties under development includes the acquisition cost of the property, direct development costs and borrowing costs directly attributable to the development. Borrowing costs associated with direct expenditures on properties under development are capitalized. The amount of capitalized borrowing costs is determined by reference to borrowings specific to the project, where relevant. Borrowing costs are capitalized from the commencement of the development until the date of practical completion. Practical completion is when the property is capable of operating in the manner intended by management. Capitalization of borrowing costs is suspended if there are prolonged periods when development activity is interrupted. Capitalized costs are reduced by any profits from incidental operations. Interest on projects is based on interest rates in place during the development period, and is capitalized until the project is ready for its intended use. The amount of interest capitalized during the years ended December 31, 2017 and 2016, was approximately $3.4 million and $2.8 million , respectively. |
Impairment of Long-lived Assets | Impairment of Long-lived Assets The Company continually monitors events and changes in circumstances that could indicate that the carrying amounts of its investments in real estate and related intangible assets may not be recoverable. When indicators of potential impairment suggest that the carrying value of real estate and related intangible assets may not be recoverable, the Company assesses the recoverability by estimating whether the Company will recover the carrying value of the real estate and related intangible assets through its undiscounted future cash flows (excluding interest) and its eventual disposition. If, based on this analysis, the Company does not believe that it will be able to recover the carrying value of the real estate and related intangible assets and liabilities, the Company would record an impairment loss to the extent that the carrying value exceeds the estimated fair value of the investments in real estate and related intangible assets. Key inputs that the Company estimates in this analysis include projected rental rates, capital expenditures, property sale capitalization rates, and expected holding period of the property. The Company evaluates its equity investments for impairment in accordance with ASC 320, Investments – Debt and Securities (“ASC 320”). ASC 320 provides guidance for determining when an investment is considered impaired, whether impairment is other-than-temporary, and measurement of an impairment loss. The Company continually monitors its properties under development for impairment. Estimates of future cash flows used to test the recoverability of properties under development are based on their expected service potential when development is substantially complete. Those estimates include cash flows associated with all future expenditures necessary to develop the properties under development, including interest payments that will be capitalized as part of the cost of the properties under development. The Company did not record any impairment losses during the years ended December 31, 2017 and 2016. |
Assets Held-for-Sale and Discontinued Operations | Assets Held for Sale and Discontinued Operations When certain criteria are met, long-lived assets are classified as held for sale and are reported at the lower of their carrying value or their fair value, less costs to sell, and are no longer depreciated. For property sales on or after May 1, 2014, a disposal of a component of an entity is required to be reported as discontinued operations only if the disposal represents a strategic shift that has (or will have) a major effect on an entity’s operations and financial results. Refer to Note 3. “Real Estate Investments” for a discussion of property sales and discontinued operations. |
Fair Value Measurements | Fair Value Measurements Under GAAP, the Company is required to measure or disclose certain financial instruments at fair value on a recurring basis. In addition, the Company is required to measure other financial instruments and balances at fair value on a non-recurring basis (e.g., carrying value of impaired real estate loans receivable and long-lived assets). Fair value is defined as the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The GAAP fair value framework uses a three-tiered approach. Fair value measurements are classified and disclosed in one of the following three categories: • Level 1: unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities; • Level 2: quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which significant inputs and significant value drivers are observable in active markets; and • Level 3: prices or valuation techniques where little or no market data is available for inputs that are significant to the fair value measurement. When available, the Company utilizes quoted market prices or other observable inputs (Level 2 inputs), such as interest rates or yield curves, from independent third-party sources to determine fair value and classify such items in Level 1 or Level 2. In instances where the market for a financial instrument is not active, regardless of the availability of a nonbinding quoted market price, observable inputs might not be relevant and could require the Company to use significant judgment to derive a fair value measurement. Additionally, in an inactive market, a market price quoted from an independent third-party may rely more on models with inputs based on information available only to that independent third party. When the Company determines the market for an asset owned by it to be illiquid or when market transactions for similar instruments do not appear orderly, the Company uses several valuation sources (including internal valuations, discounted cash flow analysis and external appraisals) and establishes a fair value by assigning weights to the various valuation sources. Additionally, when determining the fair value of liabilities in circumstances in which a quoted price in an active market for an identical liability is not available, the Company measures fair value using (i) a valuation technique that uses the quoted price of the identical liability when traded as an asset or quoted prices for similar liabilities when traded as assets; or (ii) a present value technique that considers the future cash flows based on contractual obligations discounted by observed or estimated market rates of comparable liabilities. The use of contractual cash flows with regard to amount and timing significantly reduces the judgment applied in arriving at fair value. Changes in assumptions or estimation methodologies can have a material effect on these estimated fair values. In this regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, may not be realized in an immediate settlement of the instrument. The Company considers the following factors to be indicators of an inactive market: (1) there are few recent transactions; (2) price quotations are not based on current information; (3) price quotations vary substantially either over time or among market makers (for example, some brokered markets); (4) indexes that previously were highly correlated with the fair values of the asset or liability are demonstrably uncorrelated with recent indications of fair value for that asset or liability; (5) there is a significant increase in implied liquidity risk premiums, yields, or performance indicators (such as delinquency rates or loss severities) for observed transactions or quoted prices when compared with the Company’s estimate of expected cash flows, considering all available market data about credit and other nonperformance risk for the asset or liability; (6) there is a wide bid-ask spread or significant increase in the bid-ask spread; (7) there is a significant decline or absence of a market for new issuances (that is, a primary market) for the asset or liability or similar assets or liabilities; and (8) little information is released publicly (for example, a principal-to-principal market). The Company considers the following factors to be indicators of non-orderly transactions: (1) there was not adequate exposure to the market for a period before the measurement date to allow for marketing activities that are usual and customary for transactions involving such assets or liabilities under current market conditions; (2) there was a usual and customary marketing period, but the seller marketed the asset or liability to a single market participant; (3) the seller is in or near bankruptcy or receivership (that is, distressed), or the seller was required to sell to meet regulatory or legal requirements (that is, forced); and (4) the transaction price is an outlier when compared with other recent transactions for the same or similar assets or liabilities. |
Deferred Financing Costs | Deferred Financing Costs Deferred financing costs represent commitment fees, loan fees, legal fees and other third-party costs associated with obtaining financing. These costs are amortized over the terms of the respective financing agreements using the straight-line method which approximates the effective interest method. Unamortized deferred financing costs are expensed when the associated debt is refinanced or repaid before maturity. Costs incurred in seeking financings that do not close are expensed in the period in which it is determined that the financing will not close. The Company presents deferred financing costs, net of accumulated amortization, as a contra-liability that reduces the carrying amount of the associated note payable, rather than as a deferred asset. Deferred financing costs related to a line-of-credit arrangement are presented on the balance sheet as a deferred asset, regardless of whether there were any outstanding borrowings at period-end. |
Accounting for Investments in Unconsolidated Joint Ventures | Accounting for Investments in Unconsolidated Joint Ventures The Company accounts for its current investments in unconsolidated joint ventures under the equity method of accounting. Under the equity method of accounting, the Company records its initial investment in a joint venture at cost and subsequently adjusts the cost for the Company’s share of the joint venture’s income or loss and cash contributions and distributions each period. Refer to Note 4. “Investments in Unconsolidated Joint Ventures” for a discussion of the Company’s investments in joint ventures. The Company monitors its investments in unconsolidated joint ventures periodically for impairment. No impairment indicators were identified and no impairment losses were recorded during the years ended December 31, 2017 and 2016. |
Income Taxes | Income Taxes The Company has elected to be taxed as a REIT under the Internal Revenue Code. To qualify as a REIT, the Company must meet certain organizational and operational requirements, including a requirement to distribute at least 90% of the Company’s annual REIT taxable income to stockholders (which is computed without regard to the dividends paid deduction or net capital gain and which does not necessarily equal net income as calculated in accordance with GAAP). As a REIT, the Company generally will not be subject to federal income tax on income that it distributes as dividends to its stockholders. If the Company fails to qualify as a REIT in any taxable year, it will be subject to federal income tax on its taxable income at regular corporate income tax rates and generally will not be permitted to qualify for treatment as a REIT for federal income tax purposes for the four taxable years following the year during which qualification is lost, unless the Internal Revenue Service grants the Company relief under certain statutory provisions. Such an event could materially and adversely affect the Company’s net income and net cash available for distribution to stockholders. However, the Company believes that it is organized and operates in such a manner as to qualify for treatment as a REIT. Even if the Company qualifies as a REIT, it may be subject to certain state or local income taxes, and to U.S. federal income and excise taxes on its undistributed income. The Company evaluates tax positions taken in the consolidated financial statements under the interpretation for accounting for uncertainty in income taxes. As a result of this evaluation, the Company may recognize a tax benefit from an uncertain tax position only if it is “more-likely-than-not” that the tax position will be sustained on examination by taxing authorities. When necessary, deferred income taxes are recognized in certain taxable entities. Deferred income tax is generally a function of the period’s temporary differences (items that are treated differently for tax purposes than for financial reporting purposes). A valuation allowance for deferred income tax assets is provided if all or some portion of the deferred income tax asset may not be realized. Any increase or decrease in the valuation allowance is generally included in deferred income tax expense. The Company’s tax returns remain subject to examination and consequently, the taxability of the distributions is subject to change. In 2017, the Company estimated it could owe Alternative Minimum Tax totaling approximately $0.1 million and this amount was accrued and included in expense as of December 31, 2017. In 2016, income taxes primarily represent taxes on the Company’s share of the gains from the sales of certain SGO MN Joint Venture properties. |
Earnings Per Share | Earnings Per Share Basic earnings per share (“EPS”) is computed by dividing net income (loss) attributable to common stockholders by the weighted average number of shares of common stock outstanding during the period. Diluted EPS is computed after adjusting the basic EPS computation for the effect of potentially dilutive securities outstanding during the period. The effect of non-vested shares, if dilutive, is computed using the treasury stock method. The Company accounts for non-vested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents (whether paid or unpaid) as participating securities, which are included in the computation of earnings per share pursuant to the two-class method. The Company’s excess of distributions over earnings related to participating securities are shown as a reduction in income (loss) attributable to common stockholders in the Company’s computation of EPS. |
Reclassifications | Reclassifications Certain prior period amounts have been reclassified to conform with current period’s presentation. The reclassifications had no effect on the Company’s financial condition, results of operations, or cash flows. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements The FASB issued the following ASUs which could have potential impact to the Company’s consolidated financial statements: In February 2017, the FASB issued ASU No. 2017-05, Other Income-Gains and Losses for the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets (“ASU 2017-05”). ASU 2017-05 amends the guidance on nonfinancial assets in Accounting Standards Codification (“ASC”) 610-20. The amendments clarify that (i) a financial asset is within the scope of ASC 610-20 if it meets the definition of an in-substance nonfinancial asset and may include nonfinancial assets transferred within a legal entity to a counter-party, (ii) an entity should identify each distinct nonfinancial asset or in substance nonfinancial asset promised to a counter-party and de-recognize each asset when a counter-party obtains control of it, and (iii) an entity should allocate consideration to each distinct asset by applying the guidance in ASC 606 on allocating the transaction price to performance obligations. Further, ASU 2017-05 provides guidance on accounting for partial sales of nonfinancial assets. The amendments are effective at the same time as the amendments in ASU No. 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”), discussed below. The adoption of ASU 2017-05 is not expected to have a material impact on the Company's consolidated financial statements. In November 2016, the FASB issued ASU No. 2016-18, Restricted Cash, which amends (Topic 230), Statement of Cash Flows (“ASU 2016-18”) . ASU 2016-18 requires that a statement of cash flows explains the change during the reporting period in the total of cash, cash equivalents, and restricted cash or restricted cash equivalents. ASU 2016-18 is effective for fiscal years beginning after December 15, 2017. Early adoption is permitted, including adoption in an interim period. ASU 2016-18 will require adoption using a retrospective transition method. The adoption will not have a material effect on the Company’s consolidated financial statements. In October 2016, the FASB issued ASU No. 2016-17, Consolidation (Topic 810), Interests Held through related Parties That Are under Common Control (“ASU 2016-17”). ASU 2016-17 changes how a reporting entity that is a single decision maker of a variable interest entity should treat indirect interest in the entity held through related parties that are under common control with the reporting entity when determining whether it is the primary beneficiary of that variable interest entity. ASU 2016-17 is effective for fiscal years beginning after December 15, 2016. Early adoption is permitted, including adoption in an interim period. ASU 2016-17 will require adoption using the retrospective transition method beginning with the fiscal year in which the amendments in ASU No. 2015-02 were initially applied. The Company adopted ASU 2016-17 beginning January 1, 2017. The adoption of ASU 2016-17 had no impact on the Company’s consolidated financial statements. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230) Classification of Certain Cash Receipts and Cash Payments (“ASU 2016-15”). ASU 2016-15 addresses eight specific cash flow issues with the objective of reducing diversity in practice. ASU 2016-15 is effective for fiscal years beginning after December 15, 2017. Early adoption is permitted, including adoption in an interim period. ASU 2016-15 will require adoption on a retrospective basis. The application of ASU 2016-15 is not expected to have an impact on the Company’s consolidated financial statements. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (“ASU 2016-13”). ASU 2016-13 requires a financial asset, measured at amortized cost basis to be presented at the net amount expected to be collected. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019, with adoption permitted for fiscal years beginning after December 15, 2018. Adjustments resulting from adopting ASU 2016-13 shall be applied through a cumulative-effect adjustment to retained earnings. The adoption of ASU 2016-13 will not have an effect on the Company’s consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) (“ASU 2016-02”). ASU 2016-02 requires entities to recognize lease assets and lease liabilities on the consolidated balance sheet and disclose key information about leasing arrangements. The guidance retains a distinction between finance leases and operating leases. The recognition, measurement and presentation of expenses and cash flows arising from a lease by a lessee have not significantly changed from previous guidance. However, the principal difference from previous guidance is that the lease assets and lease liabilities arising from operating leases should be recognized in the statement of financial position. The accounting applied by a lessor is largely unchanged from that applied under the previous guidance. Lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The modified retrospective approach includes a number of optional practical expedients that entities may elect to apply. On January 5, 2018, the FASB also issued an Exposure Draft proposing to amend ASU 2016-02, which would provide lessors with a practical expedient, by class of underlying assets, to not separate non-lease components from the related lease components and, instead, to account for those components as a single lease component, if certain criteria are met. The amendments in this guidance and the related Exposure Draft are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Earlier application is permitted. The Company believes that the adoption of ASU 2016-02 will not change the accounting for operating leases on its consolidated balance sheets. If finalized, the Company expects to utilize the practical expedients proposed in the Exposure Draft as part of its adoption of ASU 2016-02. In May 2014, the FASB issued ASU 2014-09. ASU 2014-09 outlines a single comprehensive model for entities to use in accounting for revenues arising from contracts with customers. In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date , which effectively deferred the adoption of ASU 2014-09 to fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted for fiscal years beginning after December 15, 2016. Companies may apply either a full retrospective or a modified retrospective approach to adopt this guidance. In 2016, the FASB issued ASU No. 2016-08, ASU No. 2016-09 and ASU No. 2016-12, which provide interpretive clarifications on the new guidance in Topic 606. As the Company’s revenues are primarily generated through leasing arrangements, management believes the Company’s revenues fall out of the scope of this standard. For gains on sale of real estate, the Company will apply the provisions of ASC 610-20, and plans to recognize any gains at the time control of a property is transferred and when it is probable that substantially all of the related consideration will be collected. The Company will no longer apply existing sales criteria in ASC 360, Property, Plant, and Equipment . Upon adoption of ASC 610-20 on January 1, 2018, the Company recognized $0.7 million of deferred gains relating to sales of properties to the SGO Joint Venture through a cumulative effect adjustment to retained earnings. Other than the cumulative effect adjustment relating to such deferred gains, the adoption of ASC 606 and ASC 610-20 will not have a significant impact on the Company’s consolidated financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN23
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Line Items] | |
Investments in Real Estate [Table Text Block] | Depreciation and amortization is computed using a straight-line method over the estimated useful lives of the assets as follows: Years Buildings and improvements 5 - 30 years Tenant improvements 1 - 36 years |
REAL ESTATE INVESTMENTS (Tables
REAL ESTATE INVESTMENTS (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | |
Schedule of Real Estate Properties [Table Text Block] | The following table summarizes the estimated fair values of the acquired tangible and intangible assets and assumed liabilities as of the acquisition date (amounts in thousands): San Francisco Properties Fulton Shops 450 Hayes Land $ 1,737 $ 1,187 $ 2,324 Building and improvements 3,660 3,254 5,009 Lease intangibles, net 376 257 410 Below-market lease liabilities, net (143 ) (103 ) (176 ) Estimated fair value of net assets acquired $ 5,630 $ 4,595 $ 7,567 |
Disposal Groups, Including Discontinued Operations [Table Text Block] | The major classes of assets and liabilities related to assets held for sale included in the consolidated balance sheets are as follows (amounts in thousands): December 31, 2017 2016 ASSETS Investments in real estate Land $ 5,248 $ 5,718 Building and improvements 17,522 20,261 Tenant improvements 1,189 1,283 23,959 27,262 Accumulated depreciation (5,178 ) (4,257 ) Investments in real estate, net 18,781 23,005 Tenant receivables, net 248 135 Lease intangibles, net 1,617 1,017 Assets held for sale $ 20,646 $ 24,157 LIABILITIES Notes payable $ 10,749 $ 21,783 Below-market lease intangibles, net 2,268 399 Liabilities related to assets held for sale $ 13,017 $ 22,182 The following table summarizes net operating income (loss) related to the properties sold in 2017, that is included in the Company’s consolidated statements of operations for the years ended December 31, 2017 and 2016 (amounts in thousands): Year Ended December 31, 2017 2016 Pinehurst Square East Woodland West Marketplace Cochran Bypass Morningside Marketplace Pinehurst Square East Woodland West Marketplace Cochran Bypass Morningside Marketplace Operating income (loss) $ 22 $ 193 $ 27 $ 322 $ 1,028 $ (178 ) $ 2 $ 51 |
Business Acquisition, Pro Forma Information [Table Text Block] | The pro forma financial information is presented for information purposes only, and may not be indicative of what actual results of operations would have been had the transaction occurred at the beginning of 2017 and 2016, respectively, nor does it purport to represent results of operations for future periods (amounts in thousands, except per share amounts): (Pro Forma) Year Ended 2017 2016 Rental and reimbursement revenues $ 6,888 $ 5,076 Net income 8,292 8,186 Net income attributable to common stockholders 8,017 7,881 Net income per share, attributable to common shares - basic and diluted $ 0.73 $ 0.72 |
INVESTMENTS IN UNCONSOLIDATED25
INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Schedule of Investment in Unconsolidated Joint Ventures | The following table summarizes the Company’s investments in unconsolidated joint ventures as of December 31, 2017 and 2016 (amounts in thousands): Ownership Interest Investment Joint Venture Date of Investment December 31, December 31, December 31, December 31, SGO Retail Acquisitions Venture, LLC 3/11/2015 19 % 19 % $ 978 $ 3,052 SGO MN Retail Acquisitions Venture, LLC 9/30/2015 10 % 10 % 1,727 1,709 Total $ 2,705 $ 4,761 Year Ended December 31, December 31, Equity in income (loss) of unconsolidated joint ventures $ (59 ) $ 132 |
Condensed Balance Sheet [Table Text Block] | A summary of the aggregate balance sheets and results of operations of the SGO Joint Venture and the SGO MN Joint Venture is presented below (amounts in thousands): December 31, 2017 2016 ASSETS Investments in real estate, net $ 64,541 $ 64,032 Other assets 5,408 18,453 Assets held for sale 1,169 5,265 Total assets $ 71,118 $ 87,750 LIABILITIES AND MEMBERS’ CAPITAL Notes payable $ 45,062 $ 40,418 Other liabilities 2,737 8,907 Liabilities held for sale 900 5,273 Total liabilities 48,699 54,598 Members’ capital 22,419 33,152 Total liabilities and members’ capital $ 71,118 $ 87,750 |
Condensed Income Statement [Table Text Block] | Year Ended December 31, 2017 2016 RESULTS OF OPERATIONS Revenue $ 9,129 $ 15,523 Expenses (9,603 ) (17,139 ) Operating loss (474 ) (1,616 ) Other income 350 3,355 Net income (loss) $ (124 ) $ 1,739 |
VARIABLE INTEREST ENTITIES (Tab
VARIABLE INTEREST ENTITIES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Variable Interest Entities | The following reflects the aggregate assets and liabilities of the Gelson’s Joint Venture and the Wilshire Joint Venture, which were consolidated by the Company, as of December 31, 2017 and 2016 (amounts in thousands): December 31, 2017 2016 ASSETS Properties under development and development costs: Land $ 25,851 $ 25,851 Buildings 585 601 Development costs 9,609 4,377 Properties under development and development costs 36,045 30,829 Restricted cash 818 1,666 Cash and cash equivalents 281 334 Prepaid expenses and other assets, net 9 14 Tenant receivables, net — 1 TOTAL ASSETS (1) $ 37,153 $ 32,844 LIABILITIES Notes payable, net (2) $ 19,116 $ 19,103 Accounts payable and accrued expenses 478 806 Amounts due to affiliates 9 9 Other liabilities 9 27 TOTAL LIABILITIES $ 19,612 $ 19,945 (1) The assets of the Gelson’s Joint Venture and Wilshire Joint Venture can be used only to settle obligations of the respective consolidated joint ventures. (2) As of both December 31, 2017 and 2016 , includes reclassification of approximately $0.1 million of deferred financing costs, net, as a contra-liability. The creditors of the consolidated joint ventures do not have recourse to the general credit of the Company. The notes payable of the consolidated joint ventures are not guaranteed by the Company. |
FUTURE MINIMUM RENTAL INCOME (T
FUTURE MINIMUM RENTAL INCOME (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Operating Leases, Future Minimum Payments Receivable [Abstract] | |
Schedule of Future Minimum Rental Receivable For Operating Leases | As of December 31, 2017 , the future minimum rental income from the Company’s properties under non-cancelable operating leases, excluding properties classified as held for sale, was as follows (amounts in thousands): 2018 $ 2,549 2019 2,619 2020 2,454 2021 2,213 2022 2,230 Thereafter 9,555 Total $ 21,620 |
LEASE INTANGIBLES AND BELOW-M28
LEASE INTANGIBLES AND BELOW-MARKET LEASE LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Finite-Lived Intangible Assets, Net [Abstract] | |
Acquired Lease Intangibles and Below Market Lease Liabilities | As of December 31, 2017 and 2016 , the Company’s acquired lease intangibles and below-market lease liabilities were as follows (amounts in thousands): Lease Intangibles Below-Market Lease Liabilities December 31, December 31, December 31, December 31, Cost $ 2,783 $ 7,000 $ (571 ) $ (3,904 ) Accumulated amortization (722 ) (3,175 ) 133 855 Total $ 2,061 $ 3,825 $ (438 ) $ (3,049 ) |
Amortization Of Finite Lease Intangibles and Below-Market Lease Liabilities | The Company’s amortization of lease intangibles and below-market lease liabilities for the years ended December 31, 2017 and 2016 , were as follows (amounts in thousands): Lease Intangibles Below-Market Lease Liabilities Year Ended Year Ended 2017 2016 2017 2016 Amortization $ (853 ) $ (942 ) $ 196 $ 279 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block] | The scheduled future amortization of lease intangibles and below-market lease liabilities, as of December 31, 2017 , was as follows (amounts in thousands): Lease Intangibles Below-Market Lease Intangibles 2018 $ 323 $ (67 ) 2019 302 (63 ) 2020 259 (53 ) 2021 213 (37 ) 2022 212 (37 ) Thereafter 752 (181 ) Total $ 2,061 $ (438 ) |
NOTES PAYABLE, NET (Tables)
NOTES PAYABLE, NET (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Schedule Of Notes Payable | As of December 31, 2017 and 2016 , the Company’s notes payable, net, excluding a portion of the line of credit balance and term loan balance, which have been classified as held for sale, consisted of the following (amounts in thousands): Principal Balance Interest Rates At December 31, 2017 December 31, 2016 December 31, 2017 Line of credit (1) $ 23,107 $ 11,150 2.66 % Secured term loan — 24,277 — % Mortgage loans secured by properties under development (2) 19,200 19,200 9.5% - 10.0% Deferred financing costs, net (3) (84 ) (323 ) n/a $ 42,223 $ 54,304 (1) The Company’s line of credit is a revolving credit facility with an initial maximum aggregate commitment of $30.0 million . Effective February 15, 2017, the Company’s line of credit was refinanced to increase the maximum aggregate commitment under the credit facility from $30.0 million to $60.0 million . The credit facility matures on February 15, 2020 . Each loan made pursuant to the credit facility will be either a LIBOR rate loan or a base rate loan, at the election of the Company, plus an applicable margin, as defined. Monthly payments are interest only with the entire principal balance and all outstanding interest due at maturity. The Company will pay the lender an unused commitment fee, quarterly in arrears, which will accrue at 0.30% per annum, if the usage under the the Company’s line of credit is less than or equal to 50% of the line of credit amount, and 0.20% per annum if the usage under the Company’s line of credit is greater than 50% of the line of credit amount. The Company is providing a guaranty of all of its obligations under the Company’s line of credit and all other loan documents. As of December 31, 2017 , the Company’s line of credit was secured by Topaz Marketplace, 8 Octavia Street, 400 Grove Street, the Fulton Shops, 450 Hayes, 388 Fulton, Silver Lake, Florissant Marketplace, Ensenada Square and The Shops at Turkey Creek. As of December 31, 2016, the Company’s line of credit was secured by Pinehurst Square East, Topaz Marketplace, 8 Octavia Street, 400 Grove Street, the Fulton Shops and 450 Hayes. For information regarding recent draws under the Company’s line of credit, see “– Recent Financing Transactions The Company’s Line of Credit” below. (2) Comprised of $10.7 million and $8.5 million associated with the Company’s investment in the Gelson’s Joint Venture and the Wilshire Joint Venture, respectively. (3) Reclassification of deferred financing costs, net of accumulated amortization, as a contra-liability |
Schedule of maturities for notes payable outstanding | The following is a schedule of future principal payments for all of the Company’s notes payable outstanding as of December 31, 2017 (amounts in thousands): 2018 $ 19,200 2019 — 2020 33,856 Total (1) $ 53,056 (1) Total future principal payments reflect actual amounts due to creditors, and excludes reclassification of $0.1 million deferred financing costs, net. |
FAIR VALUE DISCLOSURES (Tables)
FAIR VALUE DISCLOSURES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Notes Payable | The following table provides the carrying values and fair values of the Company’s notes payable as of December 31, 2017 and 2016 (amounts in thousands): Carrying Value (1) Fair Value (1) (2) December 31, December 31, December 31, December 31, Notes payable, net $ 42,223 $ 54,304 $ 42,223 $ 54,781 (1) The carrying value of the Company’s notes payable represents the outstanding principal as of December 31, 2017 , and 2016 . The carrying values and fair values of the notes payable include the reclassification of deferred financing costs, net, of approximately $0.1 million and $0.3 million , respectively, as a contra-liability, as of December 31, 2017 and 2016 . (2) The estimated fair value of the notes payable is based upon the indicative market prices of the Company’s notes payable based on prevailing market interest rates. |
EQUITY (Tables)
EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Stockholders' Equity Note [Abstract] | |
Share Redemption Program | The following table summarizes share redemption activity during the years ended December 31, 2017 and 2016 (amounts in thousands, except shares): Year Ended 2017 2016 Shares of common stock redeemed 136,921 109,291 Purchase price $ 865 $ 704 |
Distributions declared and paid | The following tables set forth the quarterly distributions declared to the Company’s common stockholders and Common Unit holders for the years ended December 31, 2017 , and 2016 (amounts in thousands, except per share amounts): Distribution Record Date Distribution Payable Date Distribution Per Share of Common Stock / Common Unit Total Common Stockholders Distribution Total Common Unit Holders Distribution Total Distribution First Quarter 2017 3/31/2017 4/28/2017 $ 0.06 $ 655 $ 25 $ 680 Second Quarter 2017 6/30/2017 7/31/2017 0.06 652 25 677 Third Quarter 2017 9/30/2017 10/31/2017 0.06 660 16 676 Fourth Quarter 2017 12/31/2017 1/31/2018 0.06 659 14 673 Total $ 2,626 $ 80 $ 2,706 Distribution Record Date Distribution Payable Date Distribution Per Share of Common Stock / Common Unit Total Common Stockholders Distribution Total Common Unit Holders Distribution Total Distribution First Quarter 2016 3/31/2016 4/29/2016 $ 0.06 $ 660 $ 26 $ 686 Second Quarter 2016 7/7/2016 7/29/2016 0.06 661 25 686 Third Quarter 2016 9/30/2016 10/31/2016 0.06 659 25 684 Fourth Quarter 2016 12/30/2016 1/31/2017 0.06 656 25 681 Total $ 2,636 $ 101 $ 2,737 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Company's basic and diluted (loss)earnings per share | The following table sets forth the computation of the Company’s basic and diluted earnings (loss) per share for the years ended December 31, 2017 and 2016 (amounts in thousands, except shares and per share amounts): Year Ended 2017 2016 Numerator - basic and diluted Net income (loss) $ 8,856 $ (1,991 ) Net income (loss) attributable to non-controlling interests 295 (75 ) Net income (loss) attributable to common shares $ 8,561 $ (1,916 ) Denominator - basic and diluted Basic weighted average common shares 10,936,361 11,006,759 Common Units (1) — — Diluted weighted average common shares 10,936,361 11,006,759 Earnings (loss) per common share - basic and diluted Net earnings (loss) attributable to common shares $ 0.78 $ (0.17 ) (1) The effect of 235,194 convertible Common Units pursuant to the redemption rights outlined in the Company’s registration statement on Form S-11 have not been included as they would not be dilutive. |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Related Party Transaction, Due from (to) Related Party [Abstract] | |
Summarized below are the related-party transactions | The following table sets forth the Advisor related party costs incurred and payable by the Company for the periods presented (amounts in thousands): Incurred Payable as of Year Ended December 31, Expensed 2017 2016 2017 2016 Acquisition fees $ — $ 184 $ — $ 80 Asset management fees 868 902 — — Reimbursement of operating expenses 231 197 — — Property management fees 350 420 21 2 Disposition fees 589 203 — 29 Total $ 2,038 $ 1,906 $ 21 $ 111 Capitalized Acquisition fees $ 194 $ 275 $ — $ — Leasing fees 222 205 — — Legal leasing fees 95 78 — — Construction management fees 42 4 — — Financing coordination fees 814 — — — Total $ 1,367 $ 562 $ — $ — |
SCHEDULE III - REAL ESTATE OP34
SCHEDULE III - REAL ESTATE OPERATING PROPERTIES AND ACCUMULATED DEPRECIATION (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
SEC Schedule III, Real Estate and Accumulated Depreciation Disclosure [Abstract] | |
Schedule of Real Estate Properties [Table Text Block] | (amounts in thousands) Initial Cost to Company Cost Capitalized Subsequent to Acquisition (1) Gross Amount of Which Carried at Close of Period Life on which Depreciation in Latest Statement of Operations is Computed (3) Land Building & Improvements Land Building & Improvements Total (2) Accumulated Depreciation Acquisition Date Topaz Marketplace $ 2,120 $ 10,724 $ (1,535 ) $ 1,900 $ 9,409 $ 11,309 $ (1,626 ) 9/23/2011 5-30 400 Grove Street 1,009 1,813 — 1,009 1,813 2,822 (91 ) 6/14/2016 5-30 8 Octavia Street 728 1,847 58 728 1,905 2,633 (93 ) 6/14/2016 5-30 Fulton Shops 1,187 3,254 — 1,187 3,254 4,441 (171 ) 7/27/2016 5-30 450 Hayes 2,324 5,009 367 2,324 5,376 7,700 (187 ) 12/22/2016 5-30 388 Fulton 1,109 2,943 319 1,112 3,259 4,371 (116 ) 1/4/2017 5-30 Silver Lake 5,747 6,646 364 5,760 6,997 12,757 (295 ) 1/11/2017 5-30 Total $ 14,224 $ 32,236 $ (427 ) $ 14,020 $ 32,013 $ 46,033 $ (2,579 ) (1) The cost capitalized subsequent to acquisition may include negative balances resulting from the write-off and impairment of real estate assets, and parcel sales. (2) The aggregate net tax basis of land and buildings for federal income tax purposes is $48.0 million . (3) Buildings and building improvements are depreciated over their useful lives as shown. Tenant improvements are amortized over the life of the related lease, which with our current portfolio can vary from 1 year to over 36 years. |
schedule III, real estate and accumulated depreciation table textblock [Table Text Block] | (in thousands) Year Ended December 31, 2017 2016 Real Estate: Balance at the beginning of the year $ 65,627 $ 75,815 Acquisitions 17,128 17,171 Improvements 746 67 Dispositions (13,511 ) (10,081 ) Balances associated with changes in reporting presentation (1) (23,957 ) (17,345 ) Balance at the end of the year $ 46,033 $ 65,627 Accumulated Depreciation: Balance at the beginning of the year $ 8,163 $ 10,068 Depreciation expense 2,047 2,515 Dispositions (2,453 ) (1,058 ) Balances associated with changes in reporting presentation (1) (5,178 ) (3,362 ) Balance at the end of the year $ 2,579 $ 8,163 (1) The balances associated with changes in reporting presentation represent real estate and accumulated depreciation reclassified as assets held for sale. |
ORGANIZATION AND BUSINESS (Deta
ORGANIZATION AND BUSINESS (Details Textual) - ft² ft² in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Real Estate Properties [Line Items] | ||
Partnership Interest Ownership Percentage | 97.90% | 96.30% |
Number of Real Estate Properties | 10 | |
Net Rentable Area | 303 | |
Number of States in which Entity Operates | 4 | |
Percent of Real Estate Properties Leased | 96.00% | |
Held-for-sale [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Real Estate Properties | 3 |
SUMMARY OF SIGNIFICANT ACCOUN36
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Revenue Recognition (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Accounting Policies [Abstract] | ||
Deferred Rent Receivables, Net | $ 500 | $ 600 |
Deferred Gain on Sale of Property | $ 668 | $ 1,202 |
SUMMARY OF SIGNIFICANT ACCOUN37
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Concentration of Risk (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Clover Juice [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 16.16% | |
Fair Value, Concentration of Risk, Accounts Receivable | $ 0 | |
Ralph's Grocery [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 15.00% | |
Fair Value, Concentration of Risk, Accounts Receivable | $ 0 | |
Gold's Gym [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 12.80% | |
Fair Value, Concentration of Risk, Accounts Receivable | $ 0 |
SUMMARY OF SIGNIFICANT ACCOUN38
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Investments in Real Estate (Details) | 12 Months Ended |
Dec. 31, 2017 | |
Building and Improvements [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 5 years |
Building and Improvements [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 30 years |
Tenant Improvements [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 1 year |
Tenant Improvements [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 36 years |
SUMMARY OF SIGNIFICANT ACCOUN39
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Properties Under Development (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Variable Interest Entity, Primary Beneficiary [Member] | ||
Variable Interest Entity [Line Items] | ||
Interest Costs Capitalized | $ 3.4 | $ 2.8 |
SUMMARY OF SIGNIFICANT ACCOUN40
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Accounting for Investments in Unconsolidated Joint Ventures (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Accounting Policies [Abstract] | ||
Equity Method Investment, Other than Temporary Impairment | $ 0 | $ 0 |
SUMMARY OF SIGNIFICANT ACCOUN41
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
RequiredDistributionRateToMaintainREITStatus | 90.00% | |
Income Tax Expense | $ 181 | $ 129 |
Alternative Minimum Tax [Member] | ||
Income Tax Expense | $ 100 |
REAL ESTATE INVESTMENTS ACQUISI
REAL ESTATE INVESTMENTS ACQUISITIONS (Details) $ in Thousands | Dec. 14, 2017USD ($) | Aug. 22, 2017USD ($) | Jun. 28, 2017USD ($) | Mar. 29, 2017USD ($) | Feb. 28, 2017USD ($) | Jan. 27, 2017USD ($) | Jan. 11, 2017USD ($)ft² | Jan. 04, 2017USD ($)ft² | Dec. 27, 2016USD ($) | Dec. 22, 2016USD ($)ft² | Sep. 29, 2016USD ($) | Jul. 27, 2016USD ($)ft² | Jul. 25, 2016USD ($) | Jun. 14, 2016USD ($)ft² | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Sep. 08, 2016USD ($)ft² |
Business Acquisition [Line Items] | |||||||||||||||||
Payments to Acquire Real Estate | $ 17,812 | $ 17,792 | |||||||||||||||
Business Combination, Acquisition Related Costs | $ 300 | ||||||||||||||||
Business Combination, Pro Forma Information, Revenue of Acquiree since Acquisition Date, Actual | 400 | ||||||||||||||||
BusinessCombinationProFormaInformationOperatingExpensesOfAcquireeSinceAcquisitionDateActual | $ 300 | ||||||||||||||||
388 Fulton [Member] | |||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||
Deposits Assets, Current | $ 200 | ||||||||||||||||
Square Feet of Retail Space | ft² | 3,110 | 3,110 | |||||||||||||||
Payments to Acquire Real Estate | $ 4,200 | ||||||||||||||||
Business Acquisition, Percentage of Voting Interests Acquired | 100.00% | ||||||||||||||||
Silver Lake [Member] | |||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||
Square Feet of Retail Space | ft² | 10,497 | ||||||||||||||||
Payments to Acquire Real Estate | $ 13,300 | ||||||||||||||||
San Francisco Properties [Member] | |||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||
Square Feet of Retail Space | ft² | 5,640 | ||||||||||||||||
Payments to Acquire Real Estate | $ 5,600 | ||||||||||||||||
Business Acquisition, Percentage of Voting Interests Acquired | 100.00% | ||||||||||||||||
Land | $ 1,737 | ||||||||||||||||
Building and improvements | 3,660 | ||||||||||||||||
Lease intangibles, net | 376 | ||||||||||||||||
Below-market lease liabilities, net | (143) | ||||||||||||||||
Estimated fair value of net assets acquired | $ 5,630 | ||||||||||||||||
Fulton Street Shops [Member] | |||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||
Square Feet of Retail Space | ft² | 3,758 | ||||||||||||||||
Payments to Acquire Real Estate | $ 4,600 | ||||||||||||||||
Business Acquisition, Percentage of Voting Interests Acquired | 100.00% | ||||||||||||||||
Land | $ 1,187 | ||||||||||||||||
Building and improvements | 3,254 | ||||||||||||||||
Lease intangibles, net | 257 | ||||||||||||||||
Below-market lease liabilities, net | (103) | ||||||||||||||||
Estimated fair value of net assets acquired | $ 4,595 | ||||||||||||||||
450 Hayes [Member] | |||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||
Square Feet of Retail Space | ft² | 3,724 | ||||||||||||||||
Payments to Acquire Real Estate | $ 7,600 | ||||||||||||||||
Business Acquisition, Percentage of Voting Interests Acquired | 100.00% | ||||||||||||||||
Land | $ 2,324 | ||||||||||||||||
Building and improvements | 5,009 | ||||||||||||||||
Lease intangibles, net | 410 | ||||||||||||||||
Below-market lease liabilities, net | (176) | ||||||||||||||||
Estimated fair value of net assets acquired | 7,567 | ||||||||||||||||
Revolving Credit Facility [Member] | |||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||
Proceeds from Secured Lines of Credit | $ 5,000 | $ 1,000 | $ 1,300 | $ 1,000 | $ 600 | $ 1,000 | $ 2,000 | $ 1,000 | |||||||||
Revolving Credit Facility [Member] | 388 Fulton [Member] | |||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||
Proceeds from Secured Lines of Credit | $ 4,000 | ||||||||||||||||
Revolving Credit Facility [Member] | Silver Lake [Member] | |||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||
Proceeds from Secured Lines of Credit | $ 11,000 | ||||||||||||||||
Revolving Credit Facility [Member] | Fulton Street Shops [Member] | |||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||
Proceeds from Secured Lines of Credit | $ 4,700 | ||||||||||||||||
Revolving Credit Facility [Member] | 450 Hayes [Member] | |||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||
Proceeds from Secured Lines of Credit | $ 7,200 | ||||||||||||||||
Leases, Acquired-in-Place [Member] | Weighted Average [Member] | |||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||
Finite-Lived Intangible Asset, Useful Life | 11 years 4 months 24 days | ||||||||||||||||
Leases, Acquired-in-Place, Market Adjustment [Member] | Weighted Average [Member] | |||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||
Finite-Lived Intangible Asset, Useful Life | 11 years 2 months 12 days | ||||||||||||||||
Operating Expense [Member] | |||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||
Business Combination, Acquisition Related Costs | $ 700 |
REAL ESTATE INVESTMENTS DISPOSI
REAL ESTATE INVESTMENTS DISPOSITIONS (Details) - USD ($) $ in Thousands | Nov. 20, 2017 | Nov. 01, 2017 | Oct. 31, 2017 | Apr. 17, 2017 | Jan. 06, 2017 | Oct. 07, 2016 | Apr. 04, 2016 | Dec. 31, 2017 | Dec. 31, 2016 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Gains (Losses) on Sales of Investment Real Estate | $ 11,608 | $ 640 | |||||||
Repayments of Lines of Credit | $ 4,000 | $ 2,000 | |||||||
Operating Income (Loss) | (958) | (1,822) | |||||||
Morningside Marketplace [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Sales Price | $ 12,700 | ||||||||
Repayments of Lines of Credit | 12,000 | ||||||||
Operating Income (Loss) | 322 | 51 | |||||||
Morningside Marketplace [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | Operating Income (Loss) [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Gains (Losses) on Sales of Investment Real Estate | $ 2,400 | ||||||||
Cochran Bypass [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Sales Price | $ 2,500 | ||||||||
Repayments of Lines of Credit | 2,100 | ||||||||
Operating Income (Loss) | 27 | 2 | |||||||
Cochran Bypass [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | Operating Income (Loss) [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Gains (Losses) on Sales of Investment Real Estate | $ 44 | ||||||||
Woodland [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Sales Price | $ 14,600 | ||||||||
Repayments of Lines of Credit | 13,700 | ||||||||
Operating Income (Loss) | 193 | (178) | |||||||
Woodland [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | Operating Income (Loss) [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Gains (Losses) on Sales of Investment Real Estate | $ 2,500 | ||||||||
Pinehurst [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Sales Price | $ 19,200 | ||||||||
Repayments of Lines of Credit | 18,400 | ||||||||
Operating Income (Loss) | $ 22 | 1,028 | |||||||
Pinehurst [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | Operating Income (Loss) [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Gains (Losses) on Sales of Investment Real Estate | $ 6,100 | ||||||||
Bloomingdale Hills [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Sales Price | $ 9,200 | ||||||||
Repayments of Lines of Credit | 3,000 | ||||||||
Repayments of Debt | 5,300 | ||||||||
Operating Income (Loss) | $ 69 | ||||||||
Bloomingdale Hills [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | Operating Income (Loss) [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Gains (Losses) on Sales of Investment Real Estate | $ 600 |
REAL ESTATE INVESTMENTS PRO FOR
REAL ESTATE INVESTMENTS PRO FORMA INFORMATION (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||
Rental and reimbursement revenues | $ 9,035 | $ 10,476 |
Net income (loss) | 8,856 | (1,991) |
Net income (loss) attributable to common stockholders | $ 8,561 | $ (1,916) |
Earnings (loss) per common share - basic and diluted | $ 0.78 | $ (0.17) |
Pro Forma [Member] | ||
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||
Rental and reimbursement revenues | $ 6,888 | $ 5,076 |
Net income (loss) | 8,292 | 8,186 |
Net income (loss) attributable to common stockholders | $ 8,017 | $ 7,881 |
Earnings (loss) per common share - basic and diluted | $ 0.73 | $ 0.72 |
REAL ESTATE INVESTMENTS ASSETS
REAL ESTATE INVESTMENTS ASSETS AND LIABILITIES HELD FOR SALE (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Operating Income (Loss) | $ (958) | $ (1,822) | ||
Land | $ 14,020 | 14,020 | 15,510 | |
Building and improvements | 30,825 | 30,825 | 47,810 | |
Tenant improvements | 1,188 | 1,188 | 2,307 | |
Real Estate Investment Property, at Cost | 46,033 | 46,033 | 65,627 | |
Real Estate Investment Property, Accumulated Depreciation | (2,579) | (2,579) | (8,163) | |
Real Estate Investment Property, Net | 43,454 | 43,454 | 57,464 | |
Accounts Receivable, Net | 1,007 | 1,007 | 1,269 | |
Lease intangibles, net | 2,061 | 2,061 | 3,825 | |
Assets Held-for-sale | 20,646 | 20,646 | 24,157 | |
Notes Payable | [1] | 42,223 | 42,223 | 54,304 |
Below-market lease liabilities, net | 438 | 438 | 3,049 | |
Disposal Group, Including Discontinued Operation, Liabilities | 13,017 | 13,017 | 22,182 | |
Held-for-sale [Member] | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Operating Income (Loss) | 600 | 200 | ||
Land | 5,248 | 5,248 | 5,718 | |
Building and improvements | 17,522 | 17,522 | 20,261 | |
Tenant improvements | 1,189 | 1,189 | 1,283 | |
Real Estate Investment Property, at Cost | 23,959 | 23,959 | 27,262 | |
Real Estate Investment Property, Accumulated Depreciation | (5,178) | (5,178) | (4,257) | |
Real Estate Investment Property, Net | 18,781 | 18,781 | 23,005 | |
Accounts Receivable, Net | 248 | 248 | 135 | |
Lease intangibles, net | 1,617 | 1,617 | 1,017 | |
Assets Held-for-sale | 20,646 | 20,646 | 24,157 | |
Notes Payable | 10,749 | 10,749 | 21,783 | |
Below-market lease liabilities, net | 2,268 | 2,268 | 399 | |
Disposal Group, Including Discontinued Operation, Liabilities | $ 13,017 | $ 13,017 | $ 22,182 | |
[1] | The carrying value of the Company’s notes payable represents the outstanding principal as of December 31, 2017, and 2016. The carrying values and fair values of the notes payable include the reclassification of deferred financing costs, net, of approximately $0.1 million and $0.3 million, respectively, as a contra-liability, as of December 31, 2017 and 2016. |
INVESTMENTS IN UNCONSOLIDATED46
INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES INITIAL INVESTMENT (Details) $ in Thousands | Jan. 08, 2016USD ($) | Dec. 23, 2015USD ($) | Sep. 30, 2015USD ($) | Mar. 11, 2015USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) |
Schedule of Equity Method Investments [Line Items] | ||||||
Deferred Gain on Sale of Property | $ 668 | $ 1,202 | ||||
Number of Real Estate Properties | 10 | |||||
Payments to Acquire Real Estate | $ 17,812 | $ 17,792 | ||||
SGO Retail Acquisitions Venture, LLC | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Mortgage Loans on Real Estate | $ 34,000 | |||||
Equity Method Investment, Ownership Percentage | 19.00% | 19.00% | ||||
Deferred Gain on Sale of Property | $ 1,200 | |||||
Realized Gain Deferred, percentage | 20.00% | |||||
Equity Method Investment, Realized Gain (Loss) on Disposal | $ 500 | $ 23 | ||||
SGO MN Retail Acquisition Venture LLC [Member] | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Mortgage Loans on Real Estate | $ 50,500 | |||||
Equity Method Investment, Ownership Percentage | 10.00% | 10.00% | ||||
Number of Real Estate Properties | 14 | |||||
Payments to Acquire Real Estate | $ 1,600 | $ 79,000 | ||||
SGO MN Retail Acquisition Venture LLC [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Number of Real Estate Properties | 6 | |||||
Glenborough Property Partners, LLC [Member] | SGO Retail Acquisitions Venture, LLC | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Payments to Acquire Interest in Joint Venture | $ 200 | |||||
Equity Method Investment, Ownership Percentage | 1.00% | |||||
Ownership Interest in Joint Venture | 1.00% | |||||
Glenborough Property Partners, LLC [Member] | SGO MN Retail Acquisition Venture LLC [Member] | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Payments to Acquire Interest in Joint Venture | $ 2,800 | |||||
Equity Method Investment, Ownership Percentage | 10.00% | |||||
Oaktree [Member] [Member] | SGO Retail Acquisitions Venture, LLC | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Payments to Acquire Interest in Joint Venture | $ 19,100 | |||||
Equity Method Investment, Ownership Percentage | 80.00% | |||||
Investments In Joint Venture Internal Rate Of Return | 12.00% | |||||
Oaktree [Member] [Member] | SGO MN Retail Acquisition Venture LLC [Member] | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Payments to Acquire Interest in Joint Venture | $ 22,700 | |||||
Equity Method Investment, Ownership Percentage | 80.00% | |||||
Investments In Joint Venture Internal Rate Of Return | 12.00% | |||||
Strategic Realty Trust [Member] | SGO Retail Acquisitions Venture, LLC | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Payments to Acquire Interest in Joint Venture | $ 4,500 | |||||
Equity Method Investment, Ownership Percentage | 19.00% | |||||
Strategic Realty Trust [Member] | SGO MN Retail Acquisition Venture LLC [Member] | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Payments to Acquire Interest in Joint Venture | $ 2,800 | |||||
Equity Method Investment, Ownership Percentage | 10.00% | |||||
More than Seventeen Percent Inernal rate of Return [Member] | Glenborough Property Partners, LLC [Member] | SGO Retail Acquisitions Venture, LLC | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Investments In Joint Venture Distributions Made Percentage | 5.00% | |||||
More than Seventeen Percent Inernal rate of Return [Member] | Glenborough Property Partners, LLC [Member] | SGO MN Retail Acquisition Venture LLC [Member] | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Investments In Joint Venture Distributions Made Percentage | 17.50% | |||||
More than Seventeen Percent Inernal rate of Return [Member] | Oaktree [Member] [Member] | SGO Retail Acquisitions Venture, LLC | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Investments In Joint Venture Internal Rate Of Return | 17.00% | |||||
Equity Multiple on Capital Contribution | 1.5 | |||||
More than Seventeen Percent Inernal rate of Return [Member] | Oaktree [Member] [Member] | SGO MN Retail Acquisition Venture LLC [Member] | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Investments In Joint Venture Internal Rate Of Return | 17.00% | |||||
Equity Multiple on Capital Contribution | 1.5 | |||||
More than Seventeen Percent Inernal rate of Return [Member] | Strategic Realty Trust [Member] | SGO Retail Acquisitions Venture, LLC | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Investments In Joint Venture Distributions Made Percentage | 12.50% | |||||
More Than Twenty Two Percent Rate of Return [Member] | Glenborough Property Partners, LLC [Member] | SGO Retail Acquisitions Venture, LLC | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Investments In Joint Venture Distributions Made Percentage | 5.00% | |||||
More Than Twenty Two Percent Rate of Return [Member] | Glenborough Property Partners, LLC [Member] | SGO MN Retail Acquisition Venture LLC [Member] | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Investments In Joint Venture Distributions Made Percentage | 25.00% | |||||
More Than Twenty Two Percent Rate of Return [Member] | Oaktree [Member] [Member] | SGO Retail Acquisitions Venture, LLC | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Investments In Joint Venture Internal Rate Of Return | 22.00% | |||||
Equity Multiple on Capital Contribution | 1.75 | |||||
More Than Twenty Two Percent Rate of Return [Member] | Oaktree [Member] [Member] | SGO MN Retail Acquisition Venture LLC [Member] | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Investments In Joint Venture Internal Rate Of Return | 22.00% | |||||
Equity Multiple on Capital Contribution | 1.75 | |||||
More Than Twenty Two Percent Rate of Return [Member] | Strategic Realty Trust [Member] | SGO Retail Acquisitions Venture, LLC | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Investments In Joint Venture Distributions Made Percentage | 20.00% | |||||
More than twelve percent rate of return [Member] | SGO Retail Acquisitions Venture, LLC | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Investments In Joint Venture Internal Rate Of Return | 12.00% | |||||
More than twelve percent rate of return [Member] | SGO MN Retail Acquisition Venture LLC [Member] | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Investments In Joint Venture Internal Rate Of Return | 12.00% | |||||
More than twelve percent rate of return [Member] | Glenborough Property Partners, LLC [Member] | SGO Retail Acquisitions Venture, LLC | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Investments In Joint Venture Distributions Made Percentage | 5.00% | |||||
More than twelve percent rate of return [Member] | Strategic Realty Trust [Member] | SGO Retail Acquisitions Venture, LLC | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Investments In Joint Venture Distributions Made Percentage | 5.00% | |||||
More than twelve percent rate of return [Member] | Strategic Realty Trust [Member] | SGO MN Retail Acquisition Venture LLC [Member] | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Investments In Joint Venture Distributions Made Percentage | 10.00% |
INVESTMENTS IN UNCONSOLIDATED47
INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Schedule of Equity Method Investments [Line Items] | ||
Investment | $ 2,705 | $ 4,761 |
Income (Loss) from Equity Method Investments | (59) | 132 |
SGO Retail Acquisitions Venture, LLC | ||
Schedule of Equity Method Investments [Line Items] | ||
Investment | 978 | 3,052 |
SGO MN Retail Acquisitions Venture, LLC | ||
Schedule of Equity Method Investments [Line Items] | ||
Investment | $ 1,727 | $ 1,709 |
INVESTMENTS IN UNCONSOLIDATED48
INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES SUMMARY OF OPERTAIONS (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | |||
ASSETS | ||||
Investments in real estate, net | $ 43,454 | $ 57,464 | ||
Assets Held-for-sale | 20,646 | 24,157 | ||
TOTAL ASSETS (1) | 111,278 | [1] | 131,497 | |
Liabilities and Equity [Abstract] | ||||
Notes Payable | [2] | 42,223 | 54,304 | |
Other Liabilities | 387 | 461 | ||
Disposal Group, Including Discontinued Operation, Liabilities | 13,017 | 22,182 | ||
TOTAL LIABILITIES (1) | 58,760 | 84,264 | ||
Results of Operations [Abstract] | ||||
Operating Expenses | (9,993) | (12,298) | ||
Unconsolidated Joint Ventures [Member] | ||||
ASSETS | ||||
Investments in real estate, net | 64,541 | 64,032 | ||
Other Assets | 5,408 | 18,453 | ||
Assets Held-for-sale | 1,169 | 5,265 | ||
TOTAL ASSETS (1) | 71,118 | 87,750 | ||
Liabilities and Equity [Abstract] | ||||
Notes Payable | 45,062 | 40,418 | ||
Other Liabilities | 2,737 | 8,907 | ||
Disposal Group, Including Discontinued Operation, Liabilities | 900 | 5,273 | ||
TOTAL LIABILITIES (1) | 48,699 | 54,598 | ||
Member's capital | 22,419 | 33,152 | ||
Total liabilities and members' capital | 71,118 | 87,750 | ||
Results of Operations [Abstract] | ||||
Revenue | 9,129 | 15,523 | ||
Operating Expenses | (9,603) | (17,139) | ||
Operating loss | (474) | (1,616) | ||
Other Income | 350 | 3,355 | ||
Net Income (Loss) | $ (124) | $ 1,739 | ||
[1] | As of December 31, 2017 and 2016, includes approximately $37.2 million and $32.8 million, respectively, of assets related to consolidated variable interest entities that can be used only to settle obligations of the consolidated variable interest entities and approximately $19.6 million and $19.9 million, respectively, of liabilities of consolidated variable interest entities for which creditors do not have recourse to the general credit of the Company. Refer to Note 5. “Variable Interest Entities”. | |||
[2] | The carrying value of the Company’s notes payable represents the outstanding principal as of December 31, 2017, and 2016. The carrying values and fair values of the notes payable include the reclassification of deferred financing costs, net, of approximately $0.1 million and $0.3 million, respectively, as a contra-liability, as of December 31, 2017 and 2016. |
VARIABLE INTEREST ENTITIES (Det
VARIABLE INTEREST ENTITIES (Details Textual) $ in Thousands | Mar. 08, 2016USD ($) | Mar. 07, 2016USD ($) | Jan. 28, 2016USD ($)ft² | Jan. 07, 2016USD ($) | Aug. 31, 2017USD ($) | Jul. 31, 2017USD ($) | Feb. 28, 2017USD ($) | Jan. 31, 2017USD ($) | May 31, 2016USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Jan. 05, 2016USD ($) | Dec. 14, 2015USD ($) |
Lessee Leasing Arrangements, Operating Leases, Term of Contract | 14 years | ||||||||||||
Payments to Acquire Real Estate | $ 17,812 | $ 17,792 | |||||||||||
Gelson’s Development Joint Venture [Member] | |||||||||||||
Lessee Leasing Arrangements, Operating Leases, Term of Contract | 20 years | ||||||||||||
Proceeds from Loan Originations | $ 10,700 | $ 10,700 | |||||||||||
Payments to Acquire Real Estate | $ 13,000 | ||||||||||||
Square Feet of Retail Space | ft² | 38,000 | ||||||||||||
Profit sharing ratio of joint Venture | 50.00% | ||||||||||||
Gelson’s Development Joint Venture [Member] | Initial Contribution [Member] | |||||||||||||
Payments to Acquire Interest in Joint Venture | $ 7,000 | ||||||||||||
Gelson’s Development Joint Venture [Member] | Subsequent Contributuion [Member] | |||||||||||||
Payments to Acquire Interest in Joint Venture | $ 700 | $ 1,300 | $ 800 | $ 200 | |||||||||
Sunset Gardner LA, LLC [Member] | |||||||||||||
Profit sharing ratio of joint Venture | 50.00% | ||||||||||||
Wilshire Joint Venture [Member] | |||||||||||||
Payments to Acquire Interest in Joint Venture | $ 5,700 | ||||||||||||
Proceeds from Loan Originations | $ 8,500 | $ 8,500 | |||||||||||
Payments to Acquire Real Estate | $ 13,500 | ||||||||||||
Profit sharing ratio of joint Venture | 50.00% | ||||||||||||
Deposits Assets, Current | $ 100 | $ 500 | |||||||||||
Wilshire Joint Venture [Member] | Subsequent Contributuion [Member] | |||||||||||||
Payments to Acquire Interest in Joint Venture | $ 700 | $ 600 | $ 300 | $ 300 | |||||||||
3032 Wilshire SM [Member] | |||||||||||||
Profit sharing ratio of joint Venture | 50.00% | ||||||||||||
Wilshire Joint Venture [Member] | Strategic Realty Trust [Member] | |||||||||||||
Capital Interest Percentage in Joint Venture | 100.00% | ||||||||||||
Profit sharing ratio of joint Venture | 50.00% | ||||||||||||
Gelson’s Development Joint Venture [Member] | Strategic Realty Trust [Member] | |||||||||||||
Capital Interest Percentage in Joint Venture | 100.00% | ||||||||||||
Profit sharing ratio of joint Venture | 50.00% |
VARIABLE INTEREST ENTITIES (D50
VARIABLE INTEREST ENTITIES (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||
Properties under development and development costs: | |||||
Land | $ 25,851 | $ 25,851 | |||
Buildings | 585 | 601 | |||
Development costs | 9,609 | 4,377 | |||
Properties under development and development costs | 36,045 | 30,829 | |||
Restricted cash | 816 | 4,728 | |||
Cash and cash equivalents | 3,086 | 3,130 | $ 8,793 | ||
Prepaid expenses and other assets, net | 200 | 1,070 | |||
Tenant receivables, net | 1,007 | 1,269 | |||
TOTAL ASSETS (1) | 111,278 | [1] | 131,497 | ||
LIABILITIES | |||||
Notes payable, net | [2] | 42,223 | 54,304 | ||
Accounts payable and accrued expenses | 2,006 | 2,955 | |||
Amounts due to affiliates | 21 | 111 | |||
Other liabilities | 387 | 461 | |||
TOTAL LIABILITIES (1) | 58,760 | 84,264 | |||
Variable Interest Entity, Primary Beneficiary [Member] | |||||
Properties under development and development costs: | |||||
Land | 25,851 | 25,851 | |||
Buildings | 585 | 601 | |||
Development costs | 9,609 | 4,377 | |||
Properties under development and development costs | 36,045 | 30,829 | |||
Restricted cash | 818 | 1,666 | |||
Cash and cash equivalents | 281 | 334 | |||
Prepaid expenses and other assets, net | 9 | 14 | |||
Tenant receivables, net | 0 | 1 | |||
TOTAL ASSETS (1) | [3] | 37,153 | 32,844 | ||
LIABILITIES | |||||
Notes payable, net | [4] | 19,116 | 19,103 | ||
Accounts payable and accrued expenses | 478 | 806 | |||
Amounts due to affiliates | 9 | 9 | |||
Other liabilities | 9 | 27 | |||
TOTAL LIABILITIES (1) | 19,612 | 19,945 | |||
Deferred Costs | $ 100 | $ 100 | |||
[1] | As of December 31, 2017 and 2016, includes approximately $37.2 million and $32.8 million, respectively, of assets related to consolidated variable interest entities that can be used only to settle obligations of the consolidated variable interest entities and approximately $19.6 million and $19.9 million, respectively, of liabilities of consolidated variable interest entities for which creditors do not have recourse to the general credit of the Company. Refer to Note 5. “Variable Interest Entities”. | ||||
[2] | The carrying value of the Company’s notes payable represents the outstanding principal as of December 31, 2017, and 2016. The carrying values and fair values of the notes payable include the reclassification of deferred financing costs, net, of approximately $0.1 million and $0.3 million, respectively, as a contra-liability, as of December 31, 2017 and 2016. | ||||
[3] | The assets of the Gelson’s Joint Venture and Wilshire Joint Venture can be used only to settle obligations of the respective consolidated joint ventures. | ||||
[4] | As of both December 31, 2017 and 2016, includes reclassification of approximately $0.1 million of deferred financing costs, net, as a contra-liability. The creditors of the consolidated joint ventures do not have recourse to the general credit of the Company. The notes payable of the consolidated joint ventures are not guaranteed by the Company. |
FUTURE MINIMUM RENTAL INCOME (D
FUTURE MINIMUM RENTAL INCOME (Details Textual) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Leases [Abstract] | ||
Lessee Leasing Arrangements, Operating Leases, Term of Contract | 14 years | |
Operating Leases Weighted Average Remaining Term | 7 years | |
Security Deposit | $ 0.2 | $ 0.2 |
FUTURE MINIMUM RENTAL INCOME 52
FUTURE MINIMUM RENTAL INCOME (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Operating Leases, Future Minimum Payments Receivable [Abstract] | |
2,018 | $ 2,549 |
2,019 | 2,619 |
2,020 | 2,454 |
2,021 | 2,213 |
2,022 | 2,230 |
Thereafter | 9,555 |
Total | $ 21,620 |
LEASE INTANGIBLES AND BELOW-M53
LEASE INTANGIBLES AND BELOW-MARKET LEASE LIABILITIES (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Finite-Lived Intangible Assets, Net [Abstract] | ||
Lease Intangibles, Cost | $ 2,783 | $ 7,000 |
Lease Intangibles, Accumulated amortization | (722) | (3,175) |
Lease intangibles, net | 2,061 | 3,825 |
Below - Market Lease Liabilities, Cost | (571) | (3,904) |
Below - Market Lease Liabilities, Accumulated amortization | 133 | 855 |
Below market lease intangibles, net | $ (438) | $ (3,049) |
LEASE INTANGIBLES AND BELOW-M54
LEASE INTANGIBLES AND BELOW-MARKET LEASE LIABILITIES Lease Intangibles Amortization (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Amortization [Abstract] | ||
Amortization of Intangible Assets | $ (853) | $ (942) |
Amortization of Below-Market Lease Liabilities | $ 196 | $ 279 |
LEASE INTANGIBLES AND BELOW-M55
LEASE INTANGIBLES AND BELOW-MARKET LEASE LIABILITIES LEASE INTANGIBLES AND BELOW-MARKET LEASE LIABILITIES FUTURE AMORTIZATION (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Finite-Lived Intangible Assets, Amortization Expense, Maturity Schedule [Abstract] | ||
2,018 | $ 323 | |
2,019 | 302 | |
2,020 | 259 | |
2,021 | 213 | |
2,022 | 212 | |
Thereafter | 752 | |
Lease intangibles, net | 2,061 | $ 3,825 |
Below Market Lease, Amortization Income, Maturity Schedule [Abstract] | ||
2,018 | (67) | |
2,019 | (63) | |
2,020 | (53) | |
2,021 | (37) | |
2,022 | (37) | |
Thereafter | (181) | |
Below Market Lease, Net | $ 438 | $ 3,049 |
NOTES PAYABLE, NET (Debt Summar
NOTES PAYABLE, NET (Debt Summary) (Details) - USD ($) $ in Thousands | Nov. 20, 2017 | Feb. 15, 2017 | Oct. 07, 2016 | Mar. 08, 2016 | Jan. 28, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Oct. 31, 2017 | |||
Debt Instrument [Line Items] | |||||||||||
Repayments of Lines of Credit | $ 4,000 | $ 2,000 | |||||||||
Notes payable, net | [1] | $ 42,223 | $ 54,304 | ||||||||
Interest Expense | 1,824 | 2,212 | |||||||||
Amortization of Debt Issuance Costs | 500 | 541 | |||||||||
Interest Payable | $ 300 | 400 | |||||||||
Secured Line of Credit [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt Instrument, Interest Rate, Stated Percentage | [2] | 2.66% | |||||||||
Long-term Debt, Gross | $ 23,107 | [2] | 11,150 | [2] | $ 26,000 | ||||||
Secured term loans [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 0.00% | ||||||||||
Long-term Debt, Gross | $ 0 | 24,277 | |||||||||
Mortgage Loans Secured By Properties Under Development [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Long-term Debt, Gross | [3] | 19,200 | 19,200 | ||||||||
Accounting Standard Update 2015-03 [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Deferred Costs | [4] | (84) | (323) | ||||||||
Revolving Credit Facility [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Line of Credit Facility, Current Borrowing Capacity | $ 60,000 | 30,000 | |||||||||
Line of Credit Facility, Expiration Date | Feb. 15, 2020 | ||||||||||
Usage Under Credit Facility | 50.00% | ||||||||||
Revolving Credit Facility [Member] | Minimum [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage | 0.20% | ||||||||||
Revolving Credit Facility [Member] | Maximum [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage | 0.30% | ||||||||||
Gelson’s Development Joint Venture [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Proceeds from Loan Originations | $ 10,700 | $ 10,700 | |||||||||
Gelson’s Development Joint Venture [Member] | Mortgage Loans Secured By Properties Under Development [Member] | Minimum [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt Instrument, Interest Rate, Stated Percentage | [3] | 9.50% | |||||||||
Wilshire Joint Venture [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Proceeds from Loan Originations | $ 8,500 | $ 8,500 | |||||||||
Wilshire Joint Venture [Member] | Mortgage Loans Secured By Properties Under Development [Member] | Maximum [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt Instrument, Interest Rate, Stated Percentage | [3] | 10.00% | |||||||||
Variable Interest Entity, Primary Beneficiary [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Deferred Costs | $ 100 | 100 | |||||||||
Notes payable, net | [5] | 19,116 | 19,103 | ||||||||
Interest Costs Capitalized | 3,400 | 2,800 | |||||||||
Amortization of Debt Issuance Costs | 500 | $ 600 | |||||||||
Interest Payable | $ 200 | ||||||||||
[1] | The carrying value of the Company’s notes payable represents the outstanding principal as of December 31, 2017, and 2016. The carrying values and fair values of the notes payable include the reclassification of deferred financing costs, net, of approximately $0.1 million and $0.3 million, respectively, as a contra-liability, as of December 31, 2017 and 2016. | ||||||||||
[2] | The Company’s line of credit is a revolving credit facility with an initial maximum aggregate commitment of $30.0 million. Effective February 15, 2017, the Company’s line of credit was refinanced to increase the maximum aggregate commitment under the credit facility from $30.0 million to $60.0 million. The credit facility matures on February 15, 2020. Each loan made pursuant to the credit facility will be either a LIBOR rate loan or a base rate loan, at the election of the Company, plus an applicable margin, as defined. Monthly payments are interest only with the entire principal balance and all outstanding interest due at maturity. The Company will pay the lender an unused commitment fee, quarterly in arrears, which will accrue at 0.30% per annum, if the usage under the the Company’s line of credit is less than or equal to 50% of the line of credit amount, and 0.20% per annum if the usage under the Company’s line of credit is greater than 50% of the line of credit amount. The Company is providing a guaranty of all of its obligations under the Company’s line of credit and all other loan documents. As of December 31, 2017, the Company’s line of credit was secured by Topaz Marketplace, 8 Octavia Street, 400 Grove Street, the Fulton Shops, 450 Hayes, 388 Fulton, Silver Lake, Florissant Marketplace, Ensenada Square and The Shops at Turkey Creek. As of December 31, 2016, the Company’s line of credit was secured by Pinehurst Square East, Topaz Marketplace, 8 Octavia Street, 400 Grove Street, the Fulton Shops and 450 Hayes. For information regarding recent draws under the Company’s line of credit, see “– Recent Financing Transactions The Company’s Line of Credit” below. | ||||||||||
[3] | Comprised of $10.7 million and $8.5 million associated with the Company’s investment in the Gelson’s Joint Venture and the Wilshire Joint Venture, respectively. | ||||||||||
[4] | Reclassification of deferred financing costs, net of accumulated amortization, as a contra-liability | ||||||||||
[5] | As of both December 31, 2017 and 2016, includes reclassification of approximately $0.1 million of deferred financing costs, net, as a contra-liability. The creditors of the consolidated joint ventures do not have recourse to the general credit of the Company. The notes payable of the consolidated joint ventures are not guaranteed by the Company. |
NOTES PAYABLE, NET (Future Prin
NOTES PAYABLE, NET (Future Principal Payments) (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | |
Schedule of maturities for notes payable outstanding | |||
2,018 | $ 19,200 | ||
2,019 | 0 | ||
2,020 | 33,856 | ||
Total (1) | [1] | 53,056 | |
Accounting Standard Update 2015-03 [Member] | |||
Debt Instrument [Line Items] | |||
Deferred Costs | [2] | $ (84) | $ (323) |
[1] | Total future principal payments reflect actual amounts due to creditors, and excludes reclassification of $0.1 million deferred financing costs, net. | ||
[2] | Reclassification of deferred financing costs, net of accumulated amortization, as a contra-liability |
NOTES PAYABLE, NET (Recent Fina
NOTES PAYABLE, NET (Recent Financing Transactions) (Details) - USD ($) $ in Thousands | Dec. 14, 2017 | Nov. 20, 2017 | Nov. 01, 2017 | Oct. 31, 2017 | Aug. 22, 2017 | Jun. 28, 2017 | Apr. 17, 2017 | Mar. 29, 2017 | Feb. 28, 2017 | Jan. 27, 2017 | Jan. 11, 2017 | Jan. 06, 2017 | Jan. 04, 2017 | Dec. 27, 2016 | Dec. 22, 2016 | Oct. 07, 2016 | Sep. 29, 2016 | Jul. 25, 2016 | Jun. 09, 2016 | Apr. 04, 2016 | Mar. 08, 2016 | Mar. 07, 2016 | Jan. 28, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | |||
Notes Payable [Line Items] | ||||||||||||||||||||||||||||
Interest Expense | $ 1,824 | $ 2,212 | ||||||||||||||||||||||||||
Gain (Loss) on Extinguishment of Debt | (1,645) | (966) | ||||||||||||||||||||||||||
Repayments of Lines of Credit | $ 4,000 | $ 2,000 | ||||||||||||||||||||||||||
Gelson’s Development Joint Venture [Member] | ||||||||||||||||||||||||||||
Notes Payable [Line Items] | ||||||||||||||||||||||||||||
Proceeds from Loan Originations | $ 10,700 | $ 10,700 | ||||||||||||||||||||||||||
Debt Instrument, Maturity Date | Apr. 27, 2018 | |||||||||||||||||||||||||||
Wilshire Joint Venture [Member] | ||||||||||||||||||||||||||||
Notes Payable [Line Items] | ||||||||||||||||||||||||||||
Proceeds from Loan Originations | $ 8,500 | $ 8,500 | ||||||||||||||||||||||||||
Debt Instrument, Maturity Date | Sep. 7, 2018 | |||||||||||||||||||||||||||
Revolving Credit Facility [Member] | ||||||||||||||||||||||||||||
Notes Payable [Line Items] | ||||||||||||||||||||||||||||
Proceeds from Secured Lines of Credit | $ 5,000 | $ 1,000 | $ 1,300 | $ 1,000 | $ 600 | $ 1,000 | $ 2,000 | $ 1,000 | ||||||||||||||||||||
Revolving Credit Facility [Member] | Variable Interest Entity, Primary Beneficiary [Member] | ||||||||||||||||||||||||||||
Notes Payable [Line Items] | ||||||||||||||||||||||||||||
Proceeds from Secured Lines of Credit | $ 6,000 | |||||||||||||||||||||||||||
Revolving Credit Facility [Member] | Woodland [Member] | ||||||||||||||||||||||||||||
Notes Payable [Line Items] | ||||||||||||||||||||||||||||
Proceeds from Secured Lines of Credit | $ 9,800 | |||||||||||||||||||||||||||
388 Fulton [Member] | Revolving Credit Facility [Member] | ||||||||||||||||||||||||||||
Notes Payable [Line Items] | ||||||||||||||||||||||||||||
Proceeds from Secured Lines of Credit | $ 4,000 | |||||||||||||||||||||||||||
Silver Lake [Member] | Revolving Credit Facility [Member] | ||||||||||||||||||||||||||||
Notes Payable [Line Items] | ||||||||||||||||||||||||||||
Proceeds from Secured Lines of Credit | $ 11,000 | |||||||||||||||||||||||||||
8 Octavia and 400 Grove [Member] | Revolving Credit Facility [Member] | ||||||||||||||||||||||||||||
Notes Payable [Line Items] | ||||||||||||||||||||||||||||
Proceeds from Secured Lines of Credit | $ 7,500 | |||||||||||||||||||||||||||
Fulton Shops [Member] | Revolving Credit Facility [Member] | ||||||||||||||||||||||||||||
Notes Payable [Line Items] | ||||||||||||||||||||||||||||
Proceeds from Secured Lines of Credit | $ 4,700 | |||||||||||||||||||||||||||
450 Hayes [Member] | Revolving Credit Facility [Member] | ||||||||||||||||||||||||||||
Notes Payable [Line Items] | ||||||||||||||||||||||||||||
Proceeds from Secured Lines of Credit | $ 7,200 | |||||||||||||||||||||||||||
Secured Line Of Credit [Member] | ||||||||||||||||||||||||||||
Notes Payable [Line Items] | ||||||||||||||||||||||||||||
Long-term Debt, Gross | $ 26,000 | $ 23,107 | [1] | 11,150 | [1] | |||||||||||||||||||||||
Interest Rate | [1] | 2.66% | ||||||||||||||||||||||||||
Secured Term Loans [Member] | ||||||||||||||||||||||||||||
Notes Payable [Line Items] | ||||||||||||||||||||||||||||
Long-term Debt, Gross | $ 0 | 24,277 | ||||||||||||||||||||||||||
Extinguishment of Debt, Amount | 25,400 | |||||||||||||||||||||||||||
Gain (Loss) on Extinguishment of Debt | 1,400 | |||||||||||||||||||||||||||
Interest Rate | 0.00% | |||||||||||||||||||||||||||
Mortgage Loans Secured By Properties Under Development [Member] | ||||||||||||||||||||||||||||
Notes Payable [Line Items] | ||||||||||||||||||||||||||||
Long-term Debt, Gross | [2] | $ 19,200 | $ 19,200 | |||||||||||||||||||||||||
Mortgage Loans Secured By Properties Under Development [Member] | Maximum [Member] | Wilshire Joint Venture [Member] | ||||||||||||||||||||||||||||
Notes Payable [Line Items] | ||||||||||||||||||||||||||||
Interest Rate | [2] | 10.00% | ||||||||||||||||||||||||||
Mortgage Loans Secured By Properties Under Development [Member] | Minimum [Member] | Gelson’s Development Joint Venture [Member] | ||||||||||||||||||||||||||||
Notes Payable [Line Items] | ||||||||||||||||||||||||||||
Interest Rate | [2] | 9.50% | ||||||||||||||||||||||||||
Cochran Bypass [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | ||||||||||||||||||||||||||||
Notes Payable [Line Items] | ||||||||||||||||||||||||||||
Repayments of Lines of Credit | 2,100 | |||||||||||||||||||||||||||
Sales Price | $ 2,500 | |||||||||||||||||||||||||||
Morningside Marketplace [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | ||||||||||||||||||||||||||||
Notes Payable [Line Items] | ||||||||||||||||||||||||||||
Repayments of Lines of Credit | $ 12,000 | |||||||||||||||||||||||||||
Sales Price | $ 12,700 | |||||||||||||||||||||||||||
Bloomingdale Hills [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | ||||||||||||||||||||||||||||
Notes Payable [Line Items] | ||||||||||||||||||||||||||||
Repayments of Lines of Credit | $ 3,000 | |||||||||||||||||||||||||||
Sales Price | $ 9,200 | |||||||||||||||||||||||||||
Pinehurst [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | ||||||||||||||||||||||||||||
Notes Payable [Line Items] | ||||||||||||||||||||||||||||
Repayments of Lines of Credit | $ 18,400 | |||||||||||||||||||||||||||
Sales Price | $ 19,200 | |||||||||||||||||||||||||||
Woodland [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | ||||||||||||||||||||||||||||
Notes Payable [Line Items] | ||||||||||||||||||||||||||||
Repayments of Lines of Credit | $ 13,700 | |||||||||||||||||||||||||||
Sales Price | $ 14,600 | |||||||||||||||||||||||||||
Glenborough Property Partners, LLC [Member] | ||||||||||||||||||||||||||||
Notes Payable [Line Items] | ||||||||||||||||||||||||||||
Debt, Current | $ 2,500 | |||||||||||||||||||||||||||
[1] | The Company’s line of credit is a revolving credit facility with an initial maximum aggregate commitment of $30.0 million. Effective February 15, 2017, the Company’s line of credit was refinanced to increase the maximum aggregate commitment under the credit facility from $30.0 million to $60.0 million. The credit facility matures on February 15, 2020. Each loan made pursuant to the credit facility will be either a LIBOR rate loan or a base rate loan, at the election of the Company, plus an applicable margin, as defined. Monthly payments are interest only with the entire principal balance and all outstanding interest due at maturity. The Company will pay the lender an unused commitment fee, quarterly in arrears, which will accrue at 0.30% per annum, if the usage under the the Company’s line of credit is less than or equal to 50% of the line of credit amount, and 0.20% per annum if the usage under the Company’s line of credit is greater than 50% of the line of credit amount. The Company is providing a guaranty of all of its obligations under the Company’s line of credit and all other loan documents. As of December 31, 2017, the Company’s line of credit was secured by Topaz Marketplace, 8 Octavia Street, 400 Grove Street, the Fulton Shops, 450 Hayes, 388 Fulton, Silver Lake, Florissant Marketplace, Ensenada Square and The Shops at Turkey Creek. As of December 31, 2016, the Company’s line of credit was secured by Pinehurst Square East, Topaz Marketplace, 8 Octavia Street, 400 Grove Street, the Fulton Shops and 450 Hayes. For information regarding recent draws under the Company’s line of credit, see “– Recent Financing Transactions The Company’s Line of Credit” below. | |||||||||||||||||||||||||||
[2] | Comprised of $10.7 million and $8.5 million associated with the Company’s investment in the Gelson’s Joint Venture and the Wilshire Joint Venture, respectively. |
FAIR VALUE DISCLOSURES (Details
FAIR VALUE DISCLOSURES (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | |
Notes Payable | |||
Notes payable, net | [1] | $ 42,223 | $ 54,304 |
Notes Payable, Fair Value | [1],[2] | $ 42,223 | $ 54,781 |
[1] | The carrying value of the Company’s notes payable represents the outstanding principal as of December 31, 2017, and 2016. The carrying values and fair values of the notes payable include the reclassification of deferred financing costs, net, of approximately $0.1 million and $0.3 million, respectively, as a contra-liability, as of December 31, 2017 and 2016. | ||
[2] | The estimated fair value of the notes payable is based upon the indicative market prices of the Company’s notes payable based on prevailing market interest rates. |
FAIR VALUE DISCLOSURES (Detai60
FAIR VALUE DISCLOSURES (Details Textual) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | |
Accounting Standard Update 2015-03 [Member] | |||
Deferred Costs | [1] | $ (84) | $ (323) |
[1] | Reclassification of deferred financing costs, net of accumulated amortization, as a contra-liability |
EQUITY EQUITY (Common Stock) (D
EQUITY EQUITY (Common Stock) (Details) - USD ($) | Feb. 07, 2013 | Dec. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 |
Class of Stock [Line Items] | ||||
Common Stock, Shares, Issued | 10,988,438 | 10,938,245 | ||
Common Stock, Shares Authorized | 400,000,000 | 400,000,000 | ||
Common Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 | ||
Common Stock | ||||
Class of Stock [Line Items] | ||||
Cumulative stock redeemed to date, shares | 612,115 | |||
Cumulative stock redeemed to date, value | $ 4,600,000 | |||
Common Stock | ||||
Class of Stock [Line Items] | ||||
Common Stock, Shares, Issued | 10,688,940 | |||
Proceeds from Issuance of Common Stock | $ 104,700,000 | |||
Stock Issued During Period, Value, Dividend Reinvestment Plan | 391,182 | |||
Proceeds from Issuance of Common Stock, Dividend Reinvestment Plan | $ 3,600,000 | |||
Special Distribution Shares Issued To Stockholders | 273,729 | |||
Restricted Stock [Member] | Common Stock | ||||
Class of Stock [Line Items] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Net of Forfeitures | 50,000 |
EQUITY EQUITY (Common Units of
EQUITY EQUITY (Common Units of the OP) (Details) - USD ($) | Jan. 24, 2014 | Apr. 30, 2014 | Dec. 31, 2017 | Dec. 31, 2016 | Mar. 12, 2012 | May 26, 2011 |
Class of Stock [Line Items] | ||||||
Related Party Transaction, Amounts of Transaction | $ 1,000 | |||||
Stock Issued During Period, Value, Conversion of Units | $ 0 | $ 0 | ||||
Antidiluted Convertible Common Units of Redemption | 235,194 | |||||
Common Stock | ||||||
Class of Stock [Line Items] | ||||||
Stock Issued During Period, Shares, Conversion of Units | 187,114 | 9,588 | ||||
Stock Issued During Period, Value, Conversion of Units | $ 0 | $ 0 | ||||
Antidiluted Convertible Common Units of Redemption | 1,000 | |||||
Pinehurst [Member] | Common Stock | ||||||
Class of Stock [Line Items] | ||||||
Common Unit, Issued | 287,472 | |||||
Common Unit, Issuance Value | $ 2,600,000 | |||||
common unit, issuance value per unit | $ 9 | |||||
Shops at Turkey Creek [Member] | Common Stock | ||||||
Class of Stock [Line Items] | ||||||
Common Unit, Issued | 144,324 | |||||
Common Unit, Issuance Value | $ 1,400,000 | |||||
common unit, issuance value per unit | $ 9.50 | |||||
Affiliated Entity [Member] | ||||||
Class of Stock [Line Items] | ||||||
Proceeds from Contributed Capital | $ 1,000 | |||||
Operating Partnership Interest | 15.00% | |||||
Cumulative Rate of Return | 7.00% |
EQUITY EQUITY (Preferred Stock)
EQUITY EQUITY (Preferred Stock) (Details) - $ / shares | Dec. 31, 2017 | Dec. 31, 2016 |
Stockholders' Equity Note [Abstract] | ||
Preferred Stock, Shares Authorized | 50,000,000 | 50,000,000 |
Preferred stock par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred Stock, Shares Issued | 0 | 0 |
EQUITY (Share Redemption) (Deta
EQUITY (Share Redemption) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Aug. 02, 2017 | |
Class of Stock [Line Items] | |||
Common Stock Outstanding Percentage | 5.00% | ||
Redemption Price for Shares Percentage | 100.00% | ||
Amended and Restated Share Redemption, Redemption Amount Minimum Limit | $ 5 | ||
Stock Redeemed or Called During Period, Value | $ 865 | $ 704 | |
Common Stock | |||
Class of Stock [Line Items] | |||
Stock Redeemed or Called During Period, Shares | 136,921 | 109,291 | |
Stock Redeemed or Called During Period, Value | $ 865 | $ 704 | |
Cumulative stock redeemed to date, shares | 612,115 | ||
Cumulative stock redeemed to date, value | $ 4,600 | ||
Disability of a shareholder [Member] | |||
Class of Stock [Line Items] | |||
Stock Repurchase Program, Authorized Amount | 1,000 | ||
Death of a shareholder [Member] | |||
Class of Stock [Line Items] | |||
Stock Repurchase Program, Authorized Amount | $ 2,000 | ||
Additional Shares Authorized for Redemption, Value | $ 500 | $ 1,000 |
EQUITY (Quarterly Distribution)
EQUITY (Quarterly Distribution) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | |
Dividends [Line Items] | ||||||||||
Minimum Percentage of Taxable Income Distributed to Shareholders | 90.00% | |||||||||
Distribution Record Date | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 30, 2016 | Sep. 30, 2016 | Jul. 7, 2016 | Mar. 31, 2016 | ||
Dividends Payable, Date to be Paid | Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 28, 2017 | Jan. 31, 2017 | Oct. 31, 2016 | Jul. 29, 2016 | Apr. 29, 2016 | ||
Common Stock, Dividends, Per Share, Declared | $ 0.06 | $ 0.06 | $ 0.06 | $ 0.06 | $ 0.06 | $ 0.06 | $ 0.06 | $ 0.06 | ||
Total Common Stockholders Distribution | $ 659 | $ 660 | $ 652 | $ 655 | $ 656 | $ 659 | $ 661 | $ 660 | $ 2,626 | $ 2,636 |
Total Common Unit Holders Distribution | 14 | 16 | 25 | 25 | 25 | 25 | 25 | 26 | 80 | 101 |
Total Distribution | $ 673 | $ 676 | $ 677 | $ 680 | $ 681 | $ 684 | $ 686 | $ 686 | $ 2,706 | $ 2,737 |
Maximum [Member] | ||||||||||
Dividends [Line Items] | ||||||||||
Distribution Limit, percentage | 100.00% | |||||||||
Distribution Limit, value | $ 2,000 |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | ||
Numerator - basic and diluted | |||
Net income (loss) | $ 8,856 | $ (1,991) | |
Net income (loss) attributable to non-controlling interests | 295 | (75) | |
Net income (loss) attributable to common stockholders | $ 8,561 | $ (1,916) | |
Weighted Average Number of Shares Outstanding, Basic and Diluted | 10,936,361 | 11,006,759 | |
Denominator - basic and diluted | |||
Basic weighted average common shares | 10,936,361 | 11,006,759 | |
Common Units (1) | [1] | 0 | 0 |
Diluted weighted average common shares | 10,936,361 | 11,006,759 | |
Earnings (loss) per common share - basic and diluted | |||
Net earnings (loss) attributable to common shares | $ 0.78 | $ (0.17) | |
[1] | The effect of 235,194 convertible Common Units pursuant to the redemption rights outlined in the Company’s registration statement on Form S-11 have not been included as they would not be dilutive. |
EARNINGS PER SHARE (Details Tex
EARNINGS PER SHARE (Details Textual) | 12 Months Ended |
Dec. 31, 2017shares | |
Earnings Per Share [Abstract] | |
Antidiluted Convertible Common Units of Redemption | 235,194 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands | Jan. 24, 2014 | Dec. 31, 2017 | Dec. 31, 2016 |
Summarized below are the related-party transactions | |||
Related-party costs, Incurred | $ 1 | ||
Expensed Acquisition Fees [Member] | Advisor Fees [Member] | |||
Summarized below are the related-party transactions | |||
Related-party costs, Incurred | $ 0 | $ 184 | |
Related-party costs, Payable | 0 | 80 | |
Expensed Asset management Fees [Member] | Advisor Fees [Member] | |||
Summarized below are the related-party transactions | |||
Related-party costs, Incurred | 868 | 902 | |
Related-party costs, Payable | 0 | 0 | |
Expensed Reimbursement Of Operating Expenses [Member] | Advisor Fees [Member] | |||
Summarized below are the related-party transactions | |||
Related-party costs, Incurred | 231 | 197 | |
Related-party costs, Payable | 0 | 0 | |
Expensed Property Management Fees [Member] | Advisor Fees [Member] | |||
Summarized below are the related-party transactions | |||
Related-party costs, Incurred | 350 | 420 | |
Related-party costs, Payable | 21 | 2 | |
Expensed Disposition Fees [Member] | Advisor Fees [Member] | |||
Summarized below are the related-party transactions | |||
Related-party costs, Incurred | 589 | 203 | |
Related-party costs, Payable | 0 | 29 | |
Capitalized Acquisition Fees [Member] | Advisor Fees [Member] | |||
Summarized below are the related-party transactions | |||
Related-party costs, Incurred | 194 | 275 | |
Related-party costs, Payable | 0 | 0 | |
Capitalized Leasing Fees [Member] | Advisor Fees [Member] | |||
Summarized below are the related-party transactions | |||
Related-party costs, Incurred | 222 | 205 | |
Related-party costs, Payable | 0 | 0 | |
Capitalized Legal Leasing Fees [Member] | Advisor Fees [Member] | |||
Summarized below are the related-party transactions | |||
Related-party costs, Incurred | 95 | 78 | |
Related-party costs, Payable | 0 | 0 | |
Capitalized Construction Management Fees [Member] | Advisor Fees [Member] | |||
Summarized below are the related-party transactions | |||
Related-party costs, Incurred | 42 | 4 | |
Related-party costs, Payable | 0 | 0 | |
Financing Coordination Fees, Capitalized [Member] | Advisor Fees [Member] | |||
Summarized below are the related-party transactions | |||
Related-party costs, Incurred | 814 | 0 | |
Related-party costs, Payable | 0 | 0 | |
Expensed [Member] | Advisor Fees [Member] | |||
Summarized below are the related-party transactions | |||
Related-party costs, Incurred | 2,038 | 1,906 | |
Related-party costs, Payable | 21 | 111 | |
Capitalized [Member] | Advisor Fees [Member] | |||
Summarized below are the related-party transactions | |||
Related-party costs, Incurred | 1,367 | 562 | |
Related-party costs, Payable | $ 0 | $ 0 |
RELATED PARTY TRANSACTIONS (D69
RELATED PARTY TRANSACTIONS (Details) (Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Related Party Transaction [Line Items] | ||
Amounts due to affiliates | $ 21,000 | $ 111,000 |
SGO Retail Acquisition Venture LLC [Member] | ||
Related Party Transaction [Line Items] | ||
Related Party Transaction, Expenses from Transactions with Related Party | 200,000 | 500,000 |
SGO MN Retail Acquisition Venture LLC [Member] | ||
Related Party Transaction [Line Items] | ||
Related Party Transaction, Expenses from Transactions with Related Party | 700,000 | $ 1,000,000 |
Glenborough Property Partners, LLC [Member] | ||
Related Party Transaction [Line Items] | ||
Debt, Current | 2,500,000 | |
Interest Expense, Related Party | $ 23,000 | |
Advisor Fees [Member] | ||
Related Party Transaction [Line Items] | ||
Company pays Advisor an acquisition and origination fee for cost of investments acquired | 1.00% | |
Financing Coordination Fee, percentage | 1.00% | |
Company pays Advisor a monthly asset management fee on all real estate investments | 0.60% | |
Percentage of Average Invested Assets | 2.00% | |
Percent of Net Income | 25.00% | |
Advisor or its affiliates also will be paid disposition fees of a customary and competitive real estate commission | 50.00% | |
SRT Manager [Member] | ||
Related Party Transaction [Line Items] | ||
Property Management Fee, Percent Fee | 4.00% | |
Construction Management Fee, percentage | 5.00% | |
Minimum [Member] | Advisor Fees [Member] | ||
Related Party Transaction [Line Items] | ||
Asset Management Fees | $ 250,000 | |
Maximum [Member] | Advisor Fees [Member] | ||
Related Party Transaction [Line Items] | ||
Advisor or its affiliates also will be paid disposition fees of the contract price | 3.00% |
SUBSEQUENT EVENTS SUBSEQUENT 70
SUBSEQUENT EVENTS SUBSEQUENT EVENTS (Details) - $ / shares | Jan. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 |
Subsequent Event [Line Items] | |||||||||
Common Stock, Dividends, Per Share, Declared | $ 0.06 | $ 0.06 | $ 0.06 | $ 0.06 | $ 0.06 | $ 0.06 | $ 0.06 | $ 0.06 | |
Subsequent Event [Member] | |||||||||
Subsequent Event [Line Items] | |||||||||
Common Stock, Dividends, Per Share, Declared | $ 0.06 |
SCHEDULE III - REAL ESTATE OP71
SCHEDULE III - REAL ESTATE OPERATING PROPERTIES AND ACCUMULATED DEPRECIATION Schedule of Real Estate Properties (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Land | $ 14,224 | ||||
Building & Improvements | 32,236 | ||||
Cost Capitalized Subsequent to Acquisition(1) | [1] | (427) | |||
Land | 14,020 | ||||
Building & Improvements | 32,013 | ||||
Total (2) | 46,033 | [2] | $ 65,627 | $ 75,815 | |
Accumulated Depreciation | (2,579) | $ (8,163) | $ (10,068) | ||
Aggregate net tax basis of land and buildings for federal income tax purposes | 48,000 | ||||
Topaz Marketplace [Member] | |||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Land | 2,120 | ||||
Building & Improvements | 10,724 | ||||
Cost Capitalized Subsequent to Acquisition(1) | [1] | (1,535) | |||
Land | 1,900 | ||||
Building & Improvements | 9,409 | ||||
Total (2) | [2] | 11,309 | |||
Accumulated Depreciation | $ (1,626) | ||||
Acquisition Date | Sep. 23, 2011 | ||||
400 Grove [Member] | |||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Land | $ 1,009 | ||||
Building & Improvements | 1,813 | ||||
Cost Capitalized Subsequent to Acquisition(1) | [1] | 0 | |||
Land | 1,009 | ||||
Building & Improvements | 1,813 | ||||
Total (2) | [2] | 2,822 | |||
Accumulated Depreciation | $ (91) | ||||
Acquisition Date | Jun. 14, 2016 | ||||
8 Octavia [Member] | |||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Land | $ 728 | ||||
Building & Improvements | 1,847 | ||||
Cost Capitalized Subsequent to Acquisition(1) | [1] | 58 | |||
Land | 728 | ||||
Building & Improvements | 1,905 | ||||
Total (2) | [2] | 2,633 | |||
Accumulated Depreciation | $ (93) | ||||
Acquisition Date | Jun. 14, 2016 | ||||
Fulton Street Shops [Member] | |||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Land | $ 1,187 | ||||
Building & Improvements | 3,254 | ||||
Cost Capitalized Subsequent to Acquisition(1) | [1] | 0 | |||
Land | 1,187 | ||||
Building & Improvements | 3,254 | ||||
Total (2) | [2] | 4,441 | |||
Accumulated Depreciation | $ (171) | ||||
Acquisition Date | Jul. 27, 2016 | ||||
450 Hayes [Member] | |||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Land | $ 2,324 | ||||
Building and improvements | 5,009 | ||||
Cost Capitalized Subsequent to Acquisition(1) | [1] | 367 | |||
Land | 2,324 | ||||
Building & Improvements | 5,376 | ||||
Total (2) | [2] | 7,700 | |||
Accumulated Depreciation | $ (187) | ||||
Acquisition Date | Dec. 22, 2016 | ||||
388 Fulton [Member] | |||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Land | $ 1,109 | ||||
Building and improvements | 2,943 | ||||
Cost Capitalized Subsequent to Acquisition(1) | [1] | 319 | |||
Land | 1,112 | ||||
Building & Improvements | 3,259 | ||||
Total (2) | [2] | 4,371 | |||
Accumulated Depreciation | $ (116) | ||||
Acquisition Date | Jan. 4, 2017 | ||||
Silver Lake [Member] | |||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Land | $ 5,747 | ||||
Building & Improvements | 6,646 | ||||
Cost Capitalized Subsequent to Acquisition(1) | [1] | 364 | |||
Land | 5,760 | ||||
Building & Improvements | 6,997 | ||||
Total (2) | [2] | 12,757 | |||
Accumulated Depreciation | $ (295) | ||||
Acquisition Date | Jan. 11, 2017 | ||||
Maximum [Member] | Topaz Marketplace [Member] | |||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Life on which Depreciation in Latest Statement of Operations is Computed(3) | [3] | 30 years | |||
Maximum [Member] | Ensenada Square [Member] | |||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Life on which Depreciation in Latest Statement of Operations is Computed(3) | [3] | 30 years | |||
Maximum [Member] | Shops at Turkey Creek [Member] | |||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Life on which Depreciation in Latest Statement of Operations is Computed(3) | [3] | 30 years | |||
Maximum [Member] | Florissant Marketplace [Member] | |||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Life on which Depreciation in Latest Statement of Operations is Computed(3) | [3] | 30 years | |||
Maximum [Member] | 400 Grove [Member] | |||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Life on which Depreciation in Latest Statement of Operations is Computed(3) | [3] | 30 years | |||
Maximum [Member] | 8 Octavia [Member] | |||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Life on which Depreciation in Latest Statement of Operations is Computed(3) | [3] | 30 years | |||
Maximum [Member] | Fulton Street Shops [Member] | |||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Life on which Depreciation in Latest Statement of Operations is Computed(3) | [3] | 30 years | |||
Maximum [Member] | 450 Hayes [Member] | |||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Life on which Depreciation in Latest Statement of Operations is Computed(3) | [3] | 30 years | |||
Maximum [Member] | 388 Fulton [Member] | |||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Life on which Depreciation in Latest Statement of Operations is Computed(3) | [3] | 30 years | |||
Maximum [Member] | Silver Lake [Member] | |||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Life on which Depreciation in Latest Statement of Operations is Computed(3) | [3] | 30 years | |||
Minimum [Member] | Topaz Marketplace [Member] | |||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Life on which Depreciation in Latest Statement of Operations is Computed(3) | [3] | 5 years | |||
Minimum [Member] | Ensenada Square [Member] | |||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Life on which Depreciation in Latest Statement of Operations is Computed(3) | [3] | 5 years | |||
Minimum [Member] | Shops at Turkey Creek [Member] | |||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Life on which Depreciation in Latest Statement of Operations is Computed(3) | [3] | 5 years | |||
Minimum [Member] | Florissant Marketplace [Member] | |||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Life on which Depreciation in Latest Statement of Operations is Computed(3) | [3] | 5 years | |||
Minimum [Member] | 400 Grove [Member] | |||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Life on which Depreciation in Latest Statement of Operations is Computed(3) | [3] | 5 years | |||
Minimum [Member] | 8 Octavia [Member] | |||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Life on which Depreciation in Latest Statement of Operations is Computed(3) | [3] | 5 years | |||
Minimum [Member] | Fulton Street Shops [Member] | |||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Life on which Depreciation in Latest Statement of Operations is Computed(3) | [3] | 5 years | |||
Minimum [Member] | 450 Hayes [Member] | |||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Life on which Depreciation in Latest Statement of Operations is Computed(3) | [3] | 5 years | |||
Minimum [Member] | 388 Fulton [Member] | |||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Life on which Depreciation in Latest Statement of Operations is Computed(3) | [3] | 5 years | |||
Minimum [Member] | Silver Lake [Member] | |||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |||||
Life on which Depreciation in Latest Statement of Operations is Computed(3) | [3] | 5 years | |||
[1] | (1)The cost capitalized subsequent to acquisition may include negative balances resulting from the write-off and impairment of real estate assets, and parcel sales. | ||||
[2] | (2)The aggregate net tax basis of land and buildings for federal income tax purposes is $48.0 million. | ||||
[3] | (3)Buildings and building improvements are depreciated over their useful lives as shown. Tenant improvements are amortized over the life of the related lease, which with our current portfolio can vary from 1 year to over 36 years. |
SCHEDULE III - REAL ESTATE OP72
SCHEDULE III - REAL ESTATE OPERATING PROPERTIES AND ACCUMULATED DEPRECIATION (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | |||
Real Estate | ||||
Balance at the beginning of the year | $ 65,627 | $ 75,815 | ||
Acquisitions | 17,128 | 17,171 | ||
Improvements | 746 | 67 | ||
Dispositions | (13,511) | (10,081) | ||
Balances associated with changes in reporting presentation (1) | [1] | (23,957) | (17,345) | |
Balance at the end of the year | 46,033 | [2] | 65,627 | |
Accumulated Depreciation | ||||
Balance at the beginning of the year | 8,163 | 10,068 | ||
Depreciation expense | 2,047 | 2,515 | ||
Dispositions | (2,453) | (1,058) | ||
Balances associated with changes in reporting presentation (1) | [1] | (5,178) | (3,362) | |
Balance at the end of the year | $ 2,579 | $ 8,163 | ||
[1] | (1)The balances associated with changes in reporting presentation represent real estate and accumulated depreciation reclassified as assets held for sale. | |||
[2] | (2)The aggregate net tax basis of land and buildings for federal income tax purposes is $48.0 million. |