Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2015 | Nov. 04, 2015 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Resource Real Estate Opportunity REIT, Inc. | |
Entity Central Index Key | 1,466,225 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2015 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 71,262,847 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Investments: | ||
Rental properties, net | $ 985,064 | $ 775,254 |
Loans held for investment and preferred equity investments, net | 4,230 | 4,985 |
Identified intangible assets, net | 1,906 | 2,081 |
Assets held for sale - rental properties, net | 0 | 36,764 |
Investments | 991,200 | 819,084 |
Cash | 94,365 | 140,129 |
Restricted cash | 9,614 | 6,930 |
Due from related parties | 1,523 | 1,148 |
Tenant receivables, net | 312 | 527 |
Deposits | 243 | 666 |
Prepaid expenses and other assets | 2,856 | 2,302 |
Deferred financing costs, net | 7,220 | 6,392 |
Goodwill | 1,231 | 1,231 |
Total assets | 1,108,564 | 978,409 |
Liabilities: | ||
Mortgage notes payable, net | 575,558 | 444,168 |
Credit facilities | 58,394 | 45,586 |
Accounts payable | 5,712 | 2,689 |
Accrued expenses and other liabilities | 5,766 | 6,473 |
Accrued real estate taxes | 8,774 | 5,689 |
Due to related parties | 2,104 | 1,630 |
Tenant prepayments | 1,133 | 1,383 |
Security deposits | 2,675 | 2,437 |
Total liabilities | 660,116 | 510,055 |
Stockholders’ equity: | ||
Preferred stock (par value $.01; 10,000,000 shares authorized, none issued) | 0 | 0 |
Common stock (par value $.01; 1,000,000,000 shares authorized; 71,647,159 and 69,469,001 shares issued, respectively; and 71,034,523 and 69,254,165 shares outstanding, respectively) | 710 | 693 |
Convertible stock (“promote shares”; par value $.01; 50,000 shares authorized, issued and outstanding) | 1 | 1 |
Additional paid-in capital | 631,690 | 614,024 |
Accumulated other comprehensive loss | (439) | (266) |
Accumulated deficit | (191,662) | (154,319) |
Total stockholders’ equity | 440,300 | 460,133 |
Noncontrolling interests | 8,148 | 8,221 |
Total equity | 448,448 | 468,354 |
Total liabilities and stockholders’ equity | $ 1,108,564 | $ 978,409 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2015 | Dec. 31, 2014 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, authorized (in shares) | 1,000,000,000 | 1,000,000,000 |
Common stock, issued (in shares) | 71,647,159 | 69,469,001 |
Common stock, outstanding (in shares) | 71,034,523 | 69,254,165 |
Convertible stock ('promote shares'), par value (in dollars per share) | $ 0.01 | $ 0.01 |
Convertible stock ('promote shares'), authorized (in shares) | 50,000 | 50,000 |
Convertible stock ('promote shares'), issued (in shares) | 50,000 | 50,000 |
Convertible stock ('promote shares'), outstanding (in shares) | 50,000 | 50,000 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Revenues: | ||||
Rental income | $ 30,693 | $ 26,812 | $ 86,514 | $ 72,391 |
Interest and dividend income | 152 | 63 | 477 | 284 |
Total revenues | 30,845 | 26,875 | 86,991 | 72,675 |
Expenses: | ||||
Rental operating | 16,800 | 15,707 | 46,273 | 40,489 |
Acquisition costs | 0 | 2,932 | 5,809 | 9,467 |
Management fees | 4,126 | 3,163 | 11,306 | 8,110 |
General and administrative | 3,677 | 2,454 | 11,514 | 8,751 |
Loss on disposal of assets | 337 | 2,473 | 2,818 | 4,121 |
Provision for loan loss | 0 | 0 | 130 | 0 |
Depreciation and amortization expense | 13,108 | 11,673 | 35,464 | 36,572 |
Total expenses | 38,048 | 38,402 | 113,314 | 107,510 |
Loss before other expenses | (7,203) | (11,527) | (26,323) | (34,835) |
Other (expense) income: | ||||
Net gains on dispositions | 2,490 | 7,824 | 36,041 | 10,365 |
Interest expense | (5,949) | (4,138) | (16,224) | (10,034) |
Insurance proceeds in excess of cost basis | 0 | 355 | 407 | 355 |
Loss from continuing operations | (10,662) | (7,486) | (6,099) | (34,149) |
Discontinued operations: | ||||
Income from discontinued operations | 0 | 0 | 0 | 2 |
Income from discontinued operations, net | 0 | 0 | 0 | 2 |
Net loss | (10,662) | (7,486) | (6,099) | (34,147) |
Net loss attributable to noncontrolling interests | 43 | 215 | 224 | 1,625 |
Net loss attributable to stockholders | (10,619) | (7,271) | (5,875) | (32,522) |
Amounts attributable to stockholders | ||||
Loss from continuing operations | (10,619) | (7,271) | (5,875) | (32,524) |
Discontinued operations | 0 | 0 | 0 | 2 |
Net loss attributable to stockholders | (10,619) | (7,271) | (5,875) | (32,522) |
Net loss | (10,662) | (7,486) | (6,099) | (34,147) |
Other comprehensive loss: | ||||
Designated derivatives, fair value adjustments | (48) | (18) | (173) | (225) |
Comprehensive loss | (10,710) | (7,504) | (6,272) | (34,372) |
Comprehensive loss attributable to noncontrolling interests | 43 | 215 | 224 | 1,625 |
Total comprehensive loss attributable to stockholders | $ (10,667) | $ (7,289) | $ (6,048) | $ (32,747) |
Weighted average common shares outstanding (in shares) | 70,724 | 68,197 | 70,110 | 67,773 |
Basic and diluted loss per common share: | ||||
Continuing operations (in dollars per share) | $ (0.15) | $ (0.11) | $ (0.08) | $ (0.48) |
Discontinued operations (in dollars per share) | 0 | 0 | 0 | 0 |
Net income (loss) (in dollars per share) | $ (0.15) | $ (0.11) | $ (0.08) | $ (0.48) |
CONSOLIDATED STATEMENT OF CHANG
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY - 9 months ended Sep. 30, 2015 - USD ($) $ in Thousands | Total | Total Stockholders' Equity [Member] | Common Stock [Member] | Convertible Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Other Comprehensive Loss [Member] | Accumulated Deficit [Member] | Noncontrolling Interests [Member] |
Beginning balance at Dec. 31, 2014 | $ 468,354 | $ 460,133 | $ 693 | $ 1 | $ 614,024 | $ (266) | $ (154,319) | $ 8,221 |
Beginning balance (in shares) at Dec. 31, 2014 | 69,254,165 | 69,254,000 | 50,000 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Common stock issued through distribution reinvestment plan | $ 21,689 | 21,689 | $ 21 | 21,668 | ||||
Common stock issued through distribution reinvestment plan (in shares) | 2,178,000 | |||||||
Distributions on common stock | (31,531) | (31,531) | (31,531) | |||||
Share redemptions | $ (3,943) | (3,943) | $ (4) | (4,002) | 63 | |||
Share redemptions (in shares) | (397,800) | (398,000) | ||||||
Other comprehensive loss | $ (173) | (173) | (173) | |||||
Contributions of noncontrolling interests | 151 | 151 | ||||||
Net loss | (6,099) | (5,875) | (5,875) | (224) | ||||
Ending balance at Sep. 30, 2015 | $ 448,448 | $ 440,300 | $ 710 | $ 1 | $ 631,690 | $ (439) | $ (191,662) | $ 8,148 |
Ending balance (in shares) at Sep. 30, 2015 | 71,034,523 | 71,034,000 | 50,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Cash flows from operating activities: | ||
Net loss | $ (6,099) | $ (34,147) |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | ||
Income from discontinued operations | 0 | (2) |
Loss on disposal of assets | 2,818 | 4,121 |
Casualty losses | 1,081 | 0 |
Provision for loan loss | 130 | 0 |
Net gains on dispositions | (36,041) | (10,365) |
Depreciation and amortization | 35,464 | 36,572 |
Amortization of deferred financing costs | 1,378 | 880 |
Amortization of fair value adjustment of debt | (602) | (426) |
Accretion of discount and direct loan fees and costs | (29) | 0 |
Changes in operating assets and liabilities, net of acquisitions: | ||
Restricted cash | (2,282) | (988) |
Tenant receivables, net | 214 | (602) |
Deposits | (10) | (306) |
Prepaid expenses and other assets | 377 | (31) |
Due to related parties, net | 215 | (1,895) |
Accounts payable and accrued expenses | 2,665 | 6,753 |
Tenant prepayments | (176) | 354 |
Security deposits | 97 | 501 |
Net cash (used in) provided by operating activities of continuing operations | (800) | 419 |
Cash flows from investing activities: | ||
Proceeds from disposal of properties, net of closing costs | 60,258 | 27,082 |
Property acquisitions | (96,953) | (252,733) |
Ownership acquisitions, net of cash received | 0 | (57,876) |
Capital expenditures | (29,230) | (27,943) |
Principal payments received on loans | 596 | 199 |
Net cash used in investing activities of continuing operations | (65,329) | (311,271) |
Cash flows from financing activities: | ||
Redemptions of common stock | (3,943) | (1,342) |
Payment of deferred financing costs | (402) | (3,440) |
Increase in borrowings on mortgages | 26,280 | 162,272 |
Principal payments on borrowings on mortgages | (4,419) | (1,901) |
Proceeds from borrowings on line of credit | 32,918 | 85,520 |
Payments on line of credit | (20,288) | (76,975) |
Distributions paid on common stock | (9,842) | (6,086) |
Contributions of noncontrolling interests | 151 | 0 |
Purchase of interest rate caps | (90) | (65) |
Distributions to noncontrolling interests | 0 | (119) |
Net cash provided by financing activities of continuing operations | 20,365 | 157,864 |
Net cash used in continuing operations | (45,764) | (152,988) |
Cash flows from discontinued operations: | ||
Cash flows from discontinued operations: | 0 | 90 |
Net cash provided by operating activities | 0 | 90 |
Net decrease in cash | (45,764) | (152,898) |
Cash at beginning of period | 140,129 | 270,323 |
Cash at end of period | $ 94,365 | $ 117,425 |
NATURE OF BUSINESS AND OPERATIO
NATURE OF BUSINESS AND OPERATIONS | 9 Months Ended |
Sep. 30, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
NATURE OF BUSINESS AND OPERATIONS | NOTE 1 - NATURE OF BUSINESS AND OPERATIONS Resource Real Estate Opportunity REIT, Inc. (the “Company”) was organized in Maryland on June 3, 2009 to purchase a diversified portfolio of discounted U.S. commercial real estate and real estate-related assets in order to generate gains to stockholders from the potential appreciation in the value of the assets and to generate current income for stockholders by distributing cash flow from the Company’s investments. Resource Real Estate Opportunity Advisor, LLC (the “Advisor”), an indirect wholly-owned subsidiary of Resource America, Inc. (“RAI”), a publicly traded company (NASDAQ: REXI) operating in the real estate, financial fund management and commercial finance sectors, manages the day-to-day operations of the Company. Through its private and public offerings, which concluded on December 13, 2013, the Company raised aggregate gross offering proceeds of $645.8 million from the issuance of 64,926,311 shares of common stock, including 276,056 shares purchased by the Advisor and 1,161,623 shares sold in the distribution reinvestment plan. During 2014, the Company sold 2,410,424 shares for $22.9 million pursuant to its distribution reinvestment plan. During the nine months ended September 30, 2015 , the Company additionally sold 2,178,158 shares for $21.7 million pursuant to its distribution reinvestment plan. The Company's distribution reinvestment plan offering is ongoing. The Company has acquired, and may continue to acquire, real estate-related debt and equity that has been discounted due to the effects of economic events and high levels of leverage, as well as stabilized properties that may benefit from extensive renovations that may increase their long-term values. The Company has a particular focus on acquiring and operating multifamily assets, and it has targeted, and intends to continue to target, this asset class while also acquiring interests in other types of commercial property assets consistent with its investment objectives. The Company’s targeted portfolio consists of commercial real estate assets, principally (i) multifamily rental properties purchased as non-performing or distressed loans or as real estate that was foreclosed upon and sold by financial institutions and (ii) multifamily rental properties to which the Company can add value with a capital infusion (referred to as “value add properties”). However, the Company is not limited in the types of real estate assets in which it may invest and, accordingly, it may invest in other real estate-related assets either directly or together with a co-investor or joint venture partner. The Company is organized and conducts its operations in a manner intended to allow it to qualify as a real estate investment trust (“REIT”) for U.S. federal income tax purposes under Subchapter M of the Internal Revenue Code of 1986, as amended. The Company also operates its business in a manner intended to maintain its exemption from registration under the Investment Company Act of 1940, as amended. The consolidated financial statements and the information and tables contained in the notes to the consolidated financial statements are unaudited. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). However, in the opinion of management, these interim financial statements include all the necessary adjustments to fairly present the results of the interim periods presented. The unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014 . The results of operations for the nine months ended September 30, 2015 may not necessarily be indicative of the results of operations for the full year ending December 31, 2015. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES A summary of the significant accounting policies consistently applied in the preparation of the accompanying consolidated financial statements follows: Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries as follows: Subsidiary Apartment Complex Number of Units Property Location RRE Opportunity Holdings, LLC N/A N/A N/A Resource Real Estate Opportunity OP, LP N/A N/A N/A RRE Charlemagne Holdings, LLC N/A N/A N/A RRE 107th Avenue Holdings, LLC (“107th Avenue”) (c) N/A N/A RRE Westhollow Holdings, LLC (“Westhollow”) (b) N/A N/A RRE Crestwood Holdings, LLC (“Crestwood”) (a)(b) N/A N/A RRE Iroquois, LP (“Vista”) Vista Apartment Homes 133 Philadelphia, PA RRE Iroquois Holdings, LLC N/A N/A N/A RRE Campus Club Holdings, LLC (“Campus Club”) (b) N/A N/A RRE Bristol Holdings, LLC (“Bristol”) (c) N/A N/A RRE Cannery Holdings, LLC (“Cannery”) Cannery Lofts 156 Dayton, OH RRE Williamsburg Holdings, LLC (“Williamsburg”) Williamsburg 976 Cincinnati, OH WPL Holdings, LLC N/A (d) N/A Cincinnati, OH RRE Skyview Holdings, LLC ("Skyview") (c) N/A N/A RRE Park Forest Holdings, LLC ("Park Forest") Mosaic 216 Oklahoma City, OK RRE Foxwood Holdings, LLC ("Foxwood") (c) N/A N/A RRE Flagstone Holdings, LLC ("Flagstone") (c) N/A N/A RRE Deerfield Holdings, LLC ("Deerfield") Deerfield 166 Hermantown, MN RRE Kenwick Canterbury Holdings, LLC ("Kenwick & Canterbury") (c) N/A N/A RRE Armand Place Holdings, LLC ("Armand") Ivy at Clear Creek 244 Houston, TX RRE Autumn Wood Holdings, LLC ("Autumn Wood") Retreat at Rocky Ridge 206 Hoover, AL RRE Village Square Holdings, LLC ("Village Square") Trailpoint at the Woodlands 271 Houston, TX RRE Nob Hill Holdings, LLC ("Nob Hill") Affinity at Winter Park 192 Winter Park, FL RRE Brentdale Holdings, LLC ("Brentdale") The Westside Apartments 412 Plano, TX RRE Jefferson Point Holdings, LLC ("Jefferson Point") Tech Center Square 208 Newport News, VA RRE Centennial Holdings, LLC ("Centennial") Verona Apartment Homes 276 Littleton, CO RRE Pinnacle Holdings, LLC ("Pinnacle") Skyview Apartment Homes 224 Westminster, CO RRE Jasmine Holdings, LLC ("Jasmine") The Nesbit Palisades 437 Alpharetta, GA RRE River Oaks Holdings, LLC ("River Oaks") Maxwell Townhomes 314 San Antonio, TX RRE Nicollet Ridge Holdings, LLC ("Nicollet Ridge") Meridian Pointe 339 Burnsville, MN RRE Addison Place, LLC ("Addison Place") The Estates at Johns Creek 403 Alpharetta, GA PRIP Coursey, LLC ("Evergreen at Coursey Place") Evergreen at Coursey Place (e) 352 Baton Rouge, LA PRIP 3700, LLC ("Champion Farms") N/A (e) N/A N/A PRIP 10637, LLC ("Fieldstone") N/A (e) N/A N/A PRIP 500, LLC ("Pinehurst") Pinehurst (e) 146 Kansas City, MO PRIP 1102, LLC ("Pheasant Run") Pheasant Run (e) 160 Lee's Summit, MO PRIP 11128, LLC ("Retreat at Shawnee") Retreat at Shawnee (e) 342 Shawnee, KS PRIP 6700, LLC ("Hilltop Village") (b)(e) N/A N/A PRIP 3383, LLC ("Conifer Place") N/A (e) N/A N/A PRIP Stone Ridge, LLC ("Stone Ridge") N/A (e) N/A N/A PRIP Pines, LLC ("Pines of York") Pines of York (e) 248 Yorktown, VA PRIP 5060/6310, LLC ("Governor Park") (b)(e) N/A N/A RRE Chisholm Place Holdings LLC ("Chisholm Place") Chisholm Place 142 Plano, TX RRE Berkeley Run Holdings, LLC ("Berkley Run") Perimeter Circle 194 Atlanta, GA RRE Berkeley Trace Holdings LLC ("Berkley Trace") Perimeter 5550 165 Atlanta, GA RRE Merrywood LLC ("Merrywood") Aston at Cinco Ranch 228 Katy, TX RRE Sunset Ridge Holdings, LLC ("Sunset Ridge") Sunset Ridge 324 San Antonio, TX RRE Parkridge Place Holdings, LLC ("Parkridge Place") Calloway at Las Colinas 536 Irving, TX RRE Spring Hill Holdings, LLC ("Spring Hill") N/A N/A N/A RRE Woodmoor Holdings, LLC ("Woodmoor") South Lamar Village 208 Austin, TX RRE Gilbert Holdings, LLC ("Springs at Gilbert") Springs at Gilbert Meadows 459 Gilbert, AZ RRE Bonita Glen Holdings, LLC ("Bonita") Villages at Bonita Glen 295 Chula Vista, CA RRE Yorba Linda Holdings, LLC ("Yorba Linda") Yorba Linda 400 Yorba Linda, CA N/A - Not Applicable (a) - Discontinued operations (b) - Sold prior to 2015 (c) - Sold in 2015 (d) - Subsidiary holds a portion of the Williamsburg parking lot (e) - Wholly-owned subsidiary of RRE Charlemagne Holdings, LLC All intercompany accounts and transactions have been eliminated in consolidation. The consolidated financial statements reflect the Company's accounts and the accounts of the Company's majority-owned and/or controlled subsidiaries. The Company follows the provisions of Accounting Standards Codification (“ASC”) Topic 810, “Consolidation,” and accordingly consolidates entities that are variable interest entities (“VIEs”) where it has determined that it is the primary beneficiary of such entities. Once it has been determined that the Company holds a variable interest in a VIE, management performs a qualitative analysis to determine (i) if the Company has the power to direct the matters that most significantly impact the VIE's financial performance; and (ii) if the Company has the obligation to absorb the losses of the VIE that could potentially be significant to the VIE or the right to receive the benefits of the VIE that could potentially be significant to the VIE. If the Company's interest possesses both of these characteristics, the Company is deemed to be the primary beneficiary and would be required to consolidate the VIE. The Company will continually assess its involvement with VIEs and re-evaluate the requirement to consolidate them. Noncontrolling interests are presented and disclosed as a separate component of stockholders' equity (not as a liability or other item outside of stockholders' equity). Consolidated net loss includes the noncontrolling interests’ share of (loss) income. All changes in the Company’s ownership interest in a subsidiary are accounted for as stockholders' equity transactions if the Company retains its controlling financial interest in the subsidiary. The portions of these entities that the Company does not own are presented as noncontrolling interests as of the dates and for the periods presented in the consolidated financial statements. The consolidated financial statements include the accounts of the Company's majority-owned and/or controlled subsidiaries as follows: Subsidiary Ownership % Apartment Complex Number Property Location Springhurst Housing Partners, LLC 70.0% Champion Farms 264 Louisville, KY Glenwood Housing Partners I, LLC 83.0% Fieldstone 266 Woodlawn, OH FPA/PRIP Conifer, LLC 42.5% Conifer Place 420 Norcross, GA DT Stone Ridge, LLC 77.7% Stone Ridge 188 Columbia, SC Use of Estimates The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Assets Held for Sale The Company presents the assets and liabilities of any rental properties which have been sold subsequent to the balance sheet date, or otherwise qualify as held for sale, separately in the Consolidated Balance Sheets. Real estate assets held for sale are measured at the lower of carrying amount or fair value less cost to sell. Both the real estate and the corresponding liabilities are presented separately in the consolidated balance sheets. Subsequent to classification of an asset as held for sale, no further depreciation is recorded. At December 31, 2014 , the Company had three rental properties included in assets held for sale. At September 30, 2015 , there were no rental properties included in assets held for sale. Rental Properties The Company records acquired rental properties at fair value. The Company considers the period of future benefit of an asset to determine its appropriate useful life and depreciates using the straight line method. The Company anticipates the estimated useful lives of its assets by class as follows: Buildings 27.5 years Building improvements 3.0 to 27.5 years Tenant improvements Shorter of lease term or expected useful life Concentration of Risk At September 30, 2015 , the Company's real estate investments in California, Texas and Georgia represented 17% , 25% and 18% of the net book value of the Company's rental properties, respectively. As a result, the geographic concentration of the Company's portfolio makes it particularly susceptible to adverse economic developments in the California, Texas and Georgia real estate markets. Any adverse economic or real estate developments in these markets, such as business layoffs or downsizing, industry slowdowns, relocations of businesses, changing demographics and other factors, or any decrease in demand for multifamily rental properties resulting from the local business climate, could adversely affect the Company's operating results and its ability to make distributions to stockholders. Impairment of Long Lived Assets When circumstances indicate the carrying value of a property may not be recoverable, the Company reviews the asset for permanent impairment. This review is based on an estimate of the future undiscounted cash flows, excluding interest charges, expected to result from the property’s use and eventual disposition. The review also considers factors such as expected future operating income, market and other applicable trends and residual value, as well as the effects of leasing demand, competition and other factors. An impairment loss will be recorded to the extent that the carrying value exceeds the estimated fair value of a property to be held and used. For properties held for sale, the impairment loss would be the adjustment to fair value less the estimated cost to dispose of the asset. There were no impairment charges during the three and nine months ended September 30, 2015 and 2014 . Loans Held for Investment, Net The Company records acquired performing loans held for investment at cost and reviews them for potential impairment at each balance sheet date. The Company considers a loan to be impaired if one of two conditions exists. The first condition is, if based on current information and events, management believes it is probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan agreement. The second condition is if the loan is deemed to be a troubled-debt restructuring (“TDR”) where a concession has been given to a borrower in financial difficulty. A TDR may not have an associated specific loan loss allowance if the principal and interest amount is considered recoverable based on current market conditions, expected collateral performance and/or guarantees made by the borrowers. The amount of impairment, if any, is measured by comparing the recorded amount of the loan to the present value of the expected cash flows or, as a practical expedient, the fair value of the collateral. If a loan is deemed to be impaired, the Company records a reserve for loan losses through a charge to income for any shortfall. Interest income from performing loans held for investment is recognized based on the contractual terms of the loan agreement. Fees related to any buy down of the interest rate are deferred as prepaid interest income and amortized over the term of the loan as an adjustment to interest income. The initial investment made in a purchased performing loan includes the amount paid to the seller plus fees. The initial investment frequently differs from the related loan’s principal amount at the date of the purchase. The difference is recognized as an adjustment of the yield over the life of the loan. Closing costs related to the purchase of a performing loan held for investment are amortized over the term of the loan and accreted as an adjustment to interest income. The Company may acquire real estate loans at a discount due to the credit quality of such loans and the respective borrowers under such loans. Revenues from these loans are recorded under the effective interest method. Under this method, an effective interest rate (“EIR”) is applied to the cost basis of the real estate loan held for investment. The EIR that is calculated when the loan held for investment is acquired remains constant and is the basis for subsequent impairment testing and income recognition. However, if the amount and timing of future cash collections are not reasonably estimable, the Company accounts for the real estate receivable on the cost recovery method. Under the cost recovery method of accounting, no income is recognized until the basis of the loan held for investment has been fully recovered. At September 30, 2015 and December 31, 2014 , there are no loans held on the cost recovery method. Preferred Equity Investment The Company records preferred equity investments at cost and evaluates the collectibility of both interest and principal at each balance sheet date. A preferred equity investment is considered impaired when, based on current information and events, it is probable that the Company will not be able to collect all amounts due according to existing contractual terms. When an investment is impaired, the amount of the loss accrual is calculated by comparing the carrying amount of the investment to its estimated fair value. Fees paid, net of expenses, are deferred and recognized as an adjustment to interest and dividend income earned over the term of the agreement. Dividend income is recognized based on the contractual terms of the preferred equity agreement. Allocation of the Purchase Price of Acquired and Foreclosed Assets The cost of rental properties acquired directly as fee interests and through foreclosing on a loan are allocated to net tangible and intangible assets based on their relative fair values . The Company allocates the purchase price of properties to acquired tangible assets, consisting of land, buildings, fixtures and improvements, and to identified intangible lease assets and liabilities, consisting of the value of above-market and below-market leases, as applicable, the value of in-place leases and the value of tenant relationships. Fair value estimates are based on information obtained from a number of sources, including information obtained about each property as a result of pre-acquisition due diligence, marketing and leasing activities. In addition, the Company may obtain independent appraisal reports. The information in the appraisal reports along with the aforementioned information available to the Company's management is used in allocating the purchase price. The independent appraisers have no involvement in management's allocation decisions other than providing market information. In allocating the purchase price, management also includes real estate taxes, insurance and other operating expenses and estimates of lost rentals at market rates during the expected lease-up period. Management also estimates costs to execute similar leases, including leasing commissions and legal and other related expenses, to the extent that such costs have not already been incurred in connection with a new lease origination as part of the transaction. The Company records above-market and below-market in-place lease values for acquired properties based on the present value (using an interest rate that reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to the in-place leases and (ii) management’s estimate of fair market lease rates for the corresponding in-place leases, measured over a period equal to the remaining non-cancelable term of the lease. The Company amortizes any capitalized above-market or below-market lease values as an increase or reduction to rental income over the remaining non-cancelable terms of the respective leases. The Company measures the aggregate value of other intangible assets acquired based on the difference between (i) the property valued with existing in-place leases adjusted to market rental rates and (ii) the property valued as if it were vacant. Management’s estimates of value are made using methods similar to those used by independent appraisers (e.g., discounted cash flow analysis). Factors to be considered by management in its analysis include an estimate of carrying costs during hypothetical expected lease-up periods considering current market conditions and costs to execute similar leases. The total amount of other intangible assets acquired is further allocated to customer relationship intangible values based on management’s evaluation of the specific characteristics of each tenant’s lease and the Company’s overall relationship with that respective tenant. Characteristics to be considered by management in allocating these values include the nature and extent of the Company’s existing relationships with the tenant, the tenant’s credit quality and expectations of lease renewals (including those existing under the terms of the lease agreement), among other factors. The Company amortizes the value of in-place leases to expense over the average remaining term of the respective leases. The value of customer relationship intangibles are amortized to expense over the initial term and any renewal periods in the respective leases, but in no event will the amortization periods for the intangible assets exceed the remaining depreciable life of the building. Should a tenant terminate its lease, the unamortized portion of the in-place lease value and customer relationship intangibles associated with that tenant would be charged to expense in that period. The determination of the fair value of assets and liabilities acquired requires the use of significant assumptions with regard to current market rental rates, discount rates and other variables. The use of inappropriate estimates would result in an incorrect assessment of the purchase price allocations, which could impact the amount of the Company’s reported net income. Initial purchase price allocations are subject to change until all information is finalized, which is generally within one year of the acquisition date. Goodwill The Company records the excess of the cost of an acquired entity over the net of the amounts assigned to assets acquired (including identified intangible assets) and liabilities assumed as goodwill. Goodwill is not amortized but is tested for impairment at a level of reporting referred to as a reporting unit during the fourth quarter of each calendar year, or more frequently if events or changes in circumstances indicate that the asset might be impaired. Revenue Recognition The Company recognizes minimum rent, including rental abatements and contractual fixed increases attributable to operating leases, on a straight-line basis over the term of the related lease and includes amounts expected to be received in later years in deferred rents. The Company records property operating expense reimbursements due from tenants for common area maintenance, real estate taxes and other recoverable costs in the period in which the related expenses are incurred. The future minimum rental payments to be received from noncancelable operating leases (excluding commercial and antenna rentals) are $60.4 million and $314,000 for the 12 month periods ending September 30, 2016 and 2017, respectively, and none thereafter. The future minimum rental payments to be received from noncancelable operating leases for commercial rental properties and antenna rentals are $325,000 , $290,000 , $160,000 , $104,000 , $79,000 , and zero for the 12 month periods ending September 30, 2016, 2017, 2018, 2019, 2020, and thereafter, respectively. Tenant Receivables Tenant receivables are stated in the financial statements as amounts due from tenants net of an allowance for uncollectible receivables. Payment terms vary and receivables outstanding longer than the payment terms are considered past due. The Company determines its allowance by considering a number of factors, including the length of time receivables are past due, security deposits held, the Company’s previous loss history, the tenants’ current ability to pay their obligations to the Company, the condition of the general economy and the industry as a whole. The Company writes off receivables when they become uncollectible. At September 30, 2015 and December 31, 2014 , there were allowances for uncollectible receivables of $35,881 and $57,300 , respectively. Income Taxes To maintain its REIT qualification for U.S. federal income tax purposes, the Company is generally required to distribute at least 90% of its taxable net income (excluding net capital gains) to its stockholders as well as comply with other requirements, including certain asset, income and stock ownership tests. As a REIT, the Company is not subject to federal corporate income tax to the extent that it distributes 100% of its REIT taxable income each year. If the Company fails to qualify as a REIT, and does not qualify for certain statutory relief provisions, it is subject to U.S. federal, state and local income taxes and may be precluded from qualifying as a REIT for the subsequent four taxable years following the year in which it fails its REIT qualification. Accordingly, the Company’s failure to qualify as a REIT could have a material adverse impact on its results of operations and amounts available for distribution to its stockholders. The dividends-paid deduction of a REIT for qualifying dividends to its stockholders is computed using the Company’s taxable income as opposed to net income reported on the financial statements. Generally, taxable income differs from net income reported on the financial statements because the determination of taxable income is based on tax provisions and not financial accounting principles. The Company may elect to treat certain of its subsidiaries as taxable REIT subsidiaries (“TRS”). In general, the Company’s TRSs may hold assets and engage in activities that the Company cannot hold or engage in directly and generally may engage in any real estate or non-real estate-related business. A TRS is subject to U.S. federal, state and local corporate income taxes. As of September 30, 2015 and December 31, 2014 , the Company had no TRSs. The Company evaluates the benefits from tax positions taken or expected to be taken in its tax return. Only the largest amount of benefits from tax positions that will more likely than not be sustainable upon examination are recognized by the Company. The Company does not have any unrecognized tax benefits, nor interest and penalties, recorded in its consolidated financial statements and does not anticipate significant adjustments to the total amount of unrecognized tax benefits within the next 12 months. The Company is subject to examination by the U.S. Internal Revenue Service and by the taxing authorities in other states in which the Company has significant business operations. The Company is not currently undergoing any examinations by taxing authorities. Earnings Per Share Basic earnings per share are computed by dividing income available to common stockholders by the weighted-average common shares outstanding during the period. Diluted earnings per share takes into account the potential dilution that could occur if securities or other contracts to issue common stock were exercised and converted to common stock. None of the 50,000 shares of convertible stock (discussed in Note 15) are included in the diluted earnings per share calculations, as the actual number of shares of common stock that will be issuable upon conversion of the convertible stock, if any, is indeterminable at September 30, 2015 and would be anti-dilutive for the three and nine months ended September 30, 2015 and 2014 due to the net loss for the periods. For the purposes of calculating earnings per share, all common shares and per common share information in the financial statements have been adjusted retroactively for the effect of seven 1.5% stock distributions, two 0.75% stock distributions, one 0.585% stock distribution and two 0.5% stock distributions issued to stockholders. Common stock shares issued on the Consolidated Balance Sheets have also been adjusted retroactively for the effect of these 12 distributions. Reclassifications Certain amounts in the prior period financial statements have been reclassified to conform to the current period presentation. The impact of the reclassifications made to prior period financial statements are not material and did not effect net income (loss). Adoption of New Accounting Standards Accounting Standards Issued But Not Yet Effective In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update (“ASU”)("ASU No. 2014-09"), “Revenue from Contracts with Customers”, which will replace most existing revenue recognition guidance in GAAP. The core principle of ASU No. 2014-09 is that an entity should recognize revenue for the transfer of goods or services equal to the amount that it expects to be entitled to receive for those goods or services. ASU No. 2014-09 requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments. ASU No. 2014-09 will be effective for the Company beginning January 1, 2018, including interim periods in 2018, and allows for both retrospective and prospective methods of adoption. The Company is in the process of determining the method of adoption and assessing the impact of this guidance on the Company’s consolidated financial position, results of operations and cash flows. In August 2014, FASB issued ASU No. 2014-15, "Presentation of Financial Statements-Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern." Under the new guidance, an entity should evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued. The guidance is effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. The adoption of the new requirements is not expected to have a material impact on the Company's consolidated financial statements. In January 2015, FASB issued ASU No. 2015-01, "Income Statement - Extraordinary and Unusual Items (Subtopic 225-20), Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items" (“ASU No. 2015-01”). The amendments in ASU No. 2015-01 eliminate from GAAP the concept of extraordinary items. Although the amendment will eliminate the requirements for reporting entities to consider whether an underlying event or transaction is extraordinary, the presentation and disclosure guidance for items that are unusual in nature or occur infrequently will be retained and will be expanded to include items that are both unusual in nature and infrequently occurring. ASU No. 2015-01 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015. Early adoption is permitted provided that the guidance is applied from the beginning of the fiscal year of adoption. The Company does not expect the adoption of ASU No. 2015-01 to have a significant impact on its consolidated financial statements. In February 2015, FASB issued ASU 2015-02, "Consolidation (Topic 810): Amendments to the Consolidation Analysis" (“ASU 2015-02”), which makes certain changes to both the variable interest model and the voting model, including changes to (1) the identification of variable interests (fees paid to a decision maker or service provider), (2) the variable interest entity characteristics for a limited partnership or similar entity and (3) the primary beneficiary determination. ASU 2015-02 is effective for the Company beginning January 1, 2016. The Company is continuing to evaluate this guidance; however, it does not expect the adoption of ASU 2015-02 to have a significant impact on its consolidated financial statements. In April 2015, FASB issued ASU 2015-03, "Simplifying the Presentation of Debt Issuance Costs" ("ASU 2015-03"), which requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected. Upon adoption, the Company will apply the new guidance on a retrospective basis and adjust the balance sheet of each individual period presented to reflect the period-specific effects of applying the new guidance. This guidance is effective for the Company beginning January 1, 2016. The Company is continuing to evaluate this guidance; however, it does not expect the adoption of ASU 2015-03 to have a significant impact on its consolidated financial statements. In September 2015, FASB issued ASU 2015-16, "Simplifying the Accounting for Measurement-Period Adjustments" ("ASU 2015-16"), which eliminates the requirement to retroactively revise comparative financial information for prior periods presented in financial statements due to changes in provisional amounts recorded for acquisitions in subsequent periods. Upon adoption, disclosure of the amounts recorded in current-period earnings that would have been recorded in previous reporting periods if the adjustment to the provisional amounts had been recognized at the acquisition date are required. ASU 2015-16 is effective for the Company beginning January 1, 2016. The Company is continuing to evaluate this guidance; however, it does not expect the adoption of ASU 2015-16 to have a significant impact on its consolidated financial statements. |
SUPPLEMENTAL CASH FLOW INFORMAT
SUPPLEMENTAL CASH FLOW INFORMATION | 9 Months Ended |
Sep. 30, 2015 | |
Supplemental Cash Flow Elements [Abstract] | |
SUPPLEMENTAL CASH FLOW INFORMATION | NOTE 3 - SUPPLEMENTAL CASH FLOW INFORMATION The following table presents supplemental cash flow information (in thousands): Nine Months Ended September 30, 2015 2014 Non-cash financing and investing activities: Stock issued from the distribution reinvestment plan $ 21,689 $ 14,181 Stock distributions issued — 3,333 Cash distributions on common stock declared but not yet paid — 4,561 Deferred financing costs and escrow deposits funded directly by mortgage note and revolving credit facility 10,709 3,767 Assets and liabilities assumed in acquisitions: Other assets assumed — 3,231 Debt assumed 40,185 158,061 Other liabilities assumed 99 3,204 Noncontrolling interests — 18,901 Rental properties, net 40,284 176,935 Cash paid during the period for: Interest $ 15,172 $ 8,420 |
RENTAL PROPERTIES, NET
RENTAL PROPERTIES, NET | 9 Months Ended |
Sep. 30, 2015 | |
Real Estate Investments, Net [Abstract] | |
RENTAL PROPERTIES, NET | NOTE 4 - RENTAL PROPERTIES, NET The Company’s investments in rental properties consisted of the following (in thousands): September 30, December 31, Land $ 190,617 $ 122,137 Building and improvements 828,420 666,912 Furniture, fixtures and equipment 28,055 21,495 Construction in progress 4,215 3,005 1,051,307 813,549 Less: accumulated depreciation (66,243 ) (38,295 ) $ 985,064 $ 775,254 Depreciation expense for the three and nine months ended September 30, 2015 was $11.3 million and $30.6 million , respectively, and for the three and nine months ended September 30, 2014 was $9.0 million and $23.4 million , respectively. During the three months ended December 31, 2014 , the Company entered into agreements to sell three rental properties, The Alcove, Cityside Crossing and The Redford, with a total net book value of $36.8 million . The Company confirmed the intent and ability to sell all three properties in their present condition and all three properties qualified for held for sale accounting treatment upon meeting all applicable criteria on or prior to December 31, 2014 , at which time depreciation ceased. As such, the assets associated with these properties are separately classified and included as assets held for sale on the Company's consolidated balance sheets at December 31, 2014 . However, the anticipated sale of these properties did not qualify for discontinued operations, and, therefore, the operations for all periods presented continue to be classified within continuing operations on the Company's consolidated statements of operations. The Company completed the sales of The Alcove, The Redford and Cityside Crossing during the three months ended March 31, 2015 (see Note 8). Loss on disposal of assets. During the three and nine months ended September 30, 2015 , the Company had losses of $337,000 and $2.8 million , respectively, on the disposal of assets, and during the three and nine months September 30, 2014 had losses on the disposal of assets of $2.5 million and $4.1 million , respectively, due to the replacement of appliances at its rental properties in conjunction with unit upgrades. |
LOANS HELD FOR INVESTMENT AND P
LOANS HELD FOR INVESTMENT AND PREFERRED EQUITY INVESTMENT, NET | 9 Months Ended |
Sep. 30, 2015 | |
Investments, Debt and Equity Securities [Abstract] | |
LOANS HELD FOR INVESTMENT AND PREFERRED EQUITY INVESTMENT, NET | NOTE 5 - LOANS HELD FOR INVESTMENT AND PREFERRED EQUITY INVESTMENT, NET The following table presents the components of loans held for investment and preferred equity investment, net (in thousands): September 30, December 31, Loans held for investment, net $ 755 $ 1,523 Preferred equity investment, net 3,475 3,462 $ 4,230 $ 4,985 Loans held for investment: On March 15, 2011, the Company purchased, at a discount, two non-performing promissory notes (the "Oberlin Note” and the "Heatherwood Note”) and two performing promissory notes (the "Peterson Note” and the "Trail Ridge Note”), collectively referred to as the “Notes”, each of which was secured by a first priority mortgage on multifamily rental apartment communities. The contract purchase price for the Notes was a total of $3.1 million , excluding closing costs. Both the Oberlin and Peterson Notes were resolved in prior years. On August 18, 2011, the Company was the successful bidder at a foreclosure sale of the property collateralizing the Heatherwood Note. Possession of the Heatherwood Apartments was obtained in February 2012 and the property was subsequently sold in April 2013. On April 18, 2013, in connection with the sale of the Heatherwood Apartments, the Company originated an $800,000 mortgage loan (the "Heatherwood Sale Note") to the purchaser of the Heatherwood Apartments on the same date. In May 2015, the Company agreed to receive $583,000 and apply $58,000 of escrow balances in full satisfaction of the loan. As such, the Company recorded a provision for loan loss of $130,000 during the nine months ended September 30, 2015 related to this payoff. There were no provisions for loan losses incurred during the three months ended September 30, 2015 or the three and nine months ended September 30, 2014 . Preferred equity investment: On November 12, 2014, the Company, through its wholly owned subsidiary, RRE Spring Hill Holdings, LLC, made a $3.5 million preferred equity investment in Spring Hill Investors Limited Partner, LLC (the “Investment Vehicle”) and became the Preferred Member. An unaffiliated limited liability company owns the common equity and acts as the managing member of the Investment Vehicle. The Company is obligated to fund up to an additional $1.5 million in increments of $150,000 upon request as long as no triggering event has occurred. Examples of triggering events include loan defaults, failure of the managing member to make payments to the Preferred Member, and unauthorized managing member interest transfers. The Investment Vehicle is the sole member of Spring Hill Investors GP, LLC, which is the general partner of Spring Hill Investors, LP, the owner of a 606 -unit multifamily residential apartment community commonly known as Spring Hill Apartments (“Spring Hill”) and located in Dallas, Texas. The Company’s preferred equity investment will be predominately utilized for capital improvements and deferred maintenance projects. The Company is to be paid a dividend equal to 12% of the total amount invested, 7% of which must be paid monthly and of which the remaining amount accrues and is to be paid when the property cash flow allows for the repayment. The mandatory redemption date for the investment is the earliest of (i) April 2017, (ii) any earlier date upon which the mortgage loan secured by Spring Hill Apartments becomes due and payable as a result of the acceleration of the loan maturity date by the lender, or (iii) the date on which a defeasance is effected pursuant to the loan documents. The preferred equity balance is presented net of nonrefundable origination fees and net of origination expenses which are being amortized over the term of the investment as an adjustment to interest and dividend income. The following table provides the aging of the Company’s loans held for investment and preferred equity investment(dollars in thousands): September 30, 2015 December 31, 2014 Loans held for investment Preferred equity investments Total Loans held for investment Preferred equity investments Total Current $ 755 $ 3,475 $ 4,230 $ 1,523 $ 3,462 $ 4,985 Delinquent: 30−89 days — — — — — — 90−180 days — — — — — — Greater than 180 days — — — — — — $ 755 $ 3,475 $ 4,230 $ 1,523 $ 3,462 $ 4,985 The following table provides information about the credit quality of the Company’s loans held for investment, net and preferred equity investment (in thousands): September 30, December 31, Performing $ 4,230 $ 4,985 Nonperforming — — Total $ 4,230 $ 4,985 The following table presents details of the balance and terms of the loan held for investment and the preferred equity investment held at September 30, 2015 (in thousands): Unpaid Principal Balance Unamortized Discount Deferred (fees) expenses, net Net book value Maturity Date Interest Rate Average monthly payment Loan- Trail Ridge $ 986 $ (239 ) $ 8 $ 755 10/28/2021 7.5% $ 8 Preferred equity investment 3,500 — (25 ) 3,475 4/1/2017 12% $ 35 $ 4,486 $ (239 ) $ (17 ) $ 4,230 The following table presents details of the balance and terms of loans held for investment and the preferred equity investment held at December 31, 2014 (in thousands): Unpaid Principal Balance Unamortized (Discount) Deferred (fees) expenses, net Net book value Loan- Trail Ridge $ 994 $ (261 ) $ 14 $ 747 Loan- Heatherwood 776 — — 776 Preferred equity investment 3,500 — (38 ) 3,462 $ 5,270 $ (261 ) $ (24 ) $ 4,985 The Company has individually evaluated each loan for impairment and determined that, as of September 30, 2015 , the loan held for investment and the preferred equity investment were not impaired. There was a $130,000 charge-off during the nine months ended September 30, 2015 and there were no charge-offs during the three and nine months ended September 30, 2014 . |
ACQUISITIONS AND FORECLOSURES
ACQUISITIONS AND FORECLOSURES | 9 Months Ended |
Sep. 30, 2015 | |
Business Combinations [Abstract] | |
ACQUISITIONS AND FORECLOSURES | NOTE 6 - ACQUISITIONS AND FORECLOSURES Real Estate Investments - Acquisitions As of September 30, 2015 , the Company owned interests in 36 properties. The Company acquired zero and four properties during the three and nine months ended September 30, 2015 . In order to finalize the fair values of the acquired assets and liabilities, the Company obtained third-party appraisals. The Company has up to 12 months from the date of acquisition to finalize the valuation for each property. All valuations have been finalized as of September 30, 2015 . The table below summarizes the Company's wholly-owned acquisitions during the nine months ended September 30, 2015 and the respective fair values assigned (dollars in thousands): Multifamily City and State Date of Purchase (1) Land Building and Furniture, Fixture and Equipment Intangible Assets Other Assets Other Fair Valued Villages at Bonita Glen Chula Vista, CA 6/16/2015 $ 49,050 $ 17,208 $ 32,651 $ 506 $ 1,130 $ 9 $ (30,008 ) $ 21,496 Yorba Linda Yorba Linda, CA 6/1/2015 118,000 39,322 76,124 590 1,964 76 (232 ) 117,844 Springs at Gilbert Meadows Gilbert, AZ 3/19/2015 36,000 8,487 25,867 716 931 — (152 ) 35,849 South Lamar Village Austin, TX 2/26/2015 24,000 5,586 17,493 291 629 — (12,961 ) 11,038 (1) Purchase price excludes closing costs and acquisition expenses. The table below summarizes the total revenues, net losses, and acquisition costs of the Company's acquisitions during the three and nine months ended September 30, 2015 (dollars in thousands): Three Months Ended September 30, 2015 Nine Months Ended September 30, 2015 Multifamily Community Total Revenues Net Loss Acquisition Costs Total Revenues Net Loss Acquisition Costs South Lamar Village $ 622 $ 401 $ — $ 1,503 $ 1,200 $ 692 Springs at Gilbert Meadows 954 538 — 2,043 1,809 1,005 Yorba Linda 1,925 1,265 — 2,548 2,324 2,761 Villages at Bonita Glen 1,114 660 — 1,299 1,431 1,351 $ 4,615 $ 2,864 $ — $ 7,393 $ 6,764 $ 5,809 |
MEASUREMENT PERIOD ADJUSTMENTS
MEASUREMENT PERIOD ADJUSTMENTS | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Changes and Error Corrections [Abstract] | |
MEASUREMENT PERIOD ADJUSTMENTS | NOTE 7 - MEASUREMENT PERIOD ADJUSTMENTS The Company obtains third party appraisals for all of its acquisitions. If the appraisals are not finalized in the period in which the property or interest was acquired, a measurement period adjustment is recorded. For the The Estates at Johns Creek (formerly known as Addison Place) acquisition, which was completed in the three months ended March 31, 2014, the measurement period adjustment was finalized during the three months ended June 30, 2014. For the Paladin acquisition, which was completed in the three months ended March 31, 2014, the measurement period adjustments were finalized during the three months ended December 31, 2014. Changes in the Paladin and The Estates at Johns Creek acquisitions are reflected in the tables below (in thousands): Paladin January 28, 2014 Measurement (1) January 28, 2014 Land $ 44,292 $ (19,420 ) $ 24,872 Building 149,155 18,364 167,519 Personal property — 3,530 3,530 Intangible assets 5,861 (96 ) 5,765 Other assets 3,231 (9 ) 3,222 Goodwill 6,412 (5,148 ) 1,264 Liabilities (140,970 ) 4,442 (136,528 ) Total net identifiable net assets $ 67,981 $ 1,663 $ 69,644 (1) Remaining balance ( $1.7 million ) of measurement period adjustments adjusted the noncontrolling interest balance. The results of operations for the three months ended March 31, 2014 included an additional $867,000 of depreciation and amortization and net income attributable to noncontrolling interests was decreased by $249,000 to reflect the adjustments that would have been included in the three months ended March 31, 2014, as originally issued, had the final appraisals for the Paladin properties been received and recorded during that period. The Estates at Johns Creek March 28, 2014 Measurement March 28, 2014 Land $ 18,137 $ (11,784 ) $ 6,353 Building 51,843 10,406 62,249 Personal property — 509 509 Intangible assets 520 869 1,389 Total net identifiable net assets $ 70,500 $ — $ 70,500 The measurement period adjustment for The Estates at Johns Creek had no impact on depreciation and amortization for the three months ended March 31, 2014. |
DISPOSITION OF PROPERTIES
DISPOSITION OF PROPERTIES | 9 Months Ended |
Sep. 30, 2015 | |
Discontinued Operations and Disposal Groups [Abstract] | |
DISPOSITION OF PROPERTIES | NOTE 8 - DISPOSITION OF PROPERTIES The following table presents details of our disposition activity during the three and nine months ended September 30, 2015 and 2014 (in thousands): Multifamily Community Location Sale Date Sales price Gain (Loss) on Sale 2015 Dispositions: The Alcove Apartments Houston, Texas January 26, 2015 $ 11,050 $ 3,784 107th Avenue Apartments Omaha, Nebraska January 29, 2015 250 50 The Redford Apartments Houston, Texas February 27, 2015 32,959 15,303 Cityside Apartments Houston, Texas March 2, 2015 24,500 10,028 One Hundred Chevy Chase Lexington, Kentucky June 30, 2015 13,500 4,386 The Reserve at Mt. Moriah Memphis, Tennessee September 18, 2015 5,425 2,490 $ 87,684 $ 36,041 2014 Dispositions: Governor Park San Diego, California March 6, 2014 $ 456 $ — Campus Club Tampa, Florida June 16, 2014 10,500 2,588 Hilltop Village Kansas City, Missouri July 1, 2014 — (501 ) Arcadia at Westheimer Houston, Texas September 19, 2014 18,100 8,278 $ 29,056 $ 10,365 |
IDENTIFIED INTANGIBLE ASSETS, N
IDENTIFIED INTANGIBLE ASSETS, NET | 9 Months Ended |
Sep. 30, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
IDENTIFIED INTANGIBLE ASSETS, NET | NOTE 9 - IDENTIFIED INTANGIBLE ASSETS, NET Identified intangible assets, net, consist of rental and antennae leases. The value of the acquired in-place leases totaled $1.9 million and $2.1 million as of September 30, 2015 and December 31, 2014 , respectively, net of accumulated amortization of $26.9 million and $26.5 million , respectively. The weighted-average remaining life of the existing rental leases was three months and five months as of September 30, 2015 and December 31, 2014 , respectively. Expected amortization for the antennae leases at the Vista Apartment Homes is $16,000 annually through 2025. Amortization of the rental and antennae leases for the three and nine months ended September 30, 2015 was $1.9 million and $4.8 million , respectively. Amortization of the rental and antennae leases for the three and nine months ended September 30, 2014 was $2.7 million and $13.3 million , respectively. Expected amortization for the rental and antennae leases for the next five 12-month periods ending September 30, and thereafter, is as follows (in thousands): 2016 $ 1,757 2017 16 2018 16 2019 16 2020 16 Thereafter 85 $ 1,906 |
MORTGAGE NOTES PAYABLE, NET
MORTGAGE NOTES PAYABLE, NET | 9 Months Ended |
Sep. 30, 2015 | |
Debt Disclosure [Abstract] | |
MORTGAGE NOTES PAYABLE, NET | NOTE 10 - MORTGAGE NOTES PAYABLE, NET The following is a summary of the mortgage notes payable (in thousands, except percentages): September 30, 2015 December 31, 2014 Collateral Outstanding Borrowings Fair Value Adjustment Net Book Value Net Book Value Maturity Annual Average Vista Apartment Homes $ 15,663 $ — $ 15,663 $ 15,900 1/1/2022 2.48% (1)(5) $ 63 Cannery Lofts 8,190 — 8,190 8,190 9/1/2020 3.49% (1)(3) 37 Deerfield 10,530 — 10,530 10,530 11/1/2020 4.66% (2)(3) 54 Ivy at Clear Creek 8,467 — 8,467 8,574 11/1/2023 2.60% (1)(4) 29 Trailpoint at the Woodlands 19,093 — 19,093 19,335 11/1/2023 2.60% (1)(4) 66 Verona Apartment Homes 22,514 — 22,514 22,843 1/1/2019 3.60% (2)(5) 106 Skyview Apartment Homes 18,180 — 18,180 18,446 1/1/2019 3.60% (2)(5) 85 The Nesbit Palisades 20,298 — 20,298 20,298 7/1/2024 2.14% (1)(3) 53 Maxwell Townhomes 13,911 — 13,911 14,089 1/1/2022 4.32% (2)(5) 71 Champion Farms 16,350 139 16,489 16,634 7/1/2016 6.14% (2)(3) 85 Fieldstone 15,450 — 15,450 15,804 6/26/2016 2.59% (1)(4) 73 Pinehurst 4,137 7 4,144 4,239 1/1/2016 5.58% (2)(5) 28 Pheasant Run 6,250 114 6,364 6,407 10/1/2017 5.95% (2)(3) 31 Retreat of Shawnee 13,139 184 13,323 13,522 2/1/2018 5.58% (2)(5) 78 Conifer Crossing 27,253 — 27,253 27,762 9/1/2016 2.69% (1)(6) 122 Coursey Place 27,656 129 27,785 28,117 8/1/2021 5.07% (2)(5) 154 Pines of York 15,333 (380 ) 14,953 15,097 12/1/2021 4.46% (2)(5) 80 The Estates at Johns Creek 50,000 — 50,000 50,000 7/1/2020 3.38% (2)(3) 207 Chisholm Place 11,587 — 11,587 11,587 6/1/2024 2.58% (1)(3) 36 Perimeter 5550 14,006 — 14,006 14,211 7/1/2019 3.42% (2)(5) 64 Perimeter Circle 17,746 — 17,746 18,007 7/1/2019 3.42% (2)(5) 81 Aston at Cinco Ranch 23,872 — 23,872 24,162 10/1/2021 4.34% (2)(5) 120 Sunset Ridge 1 20,225 348 20,573 20,930 10/1/2020 4.58% (2)(5) 113 Sunset Ridge 2 3,016 47 3,063 3,109 10/1/2020 4.54% (2)(5) 16 Calloway at Las Colinas 35,902 — 35,902 36,375 12/1/2021 3.87% (2)(5) 171 South Lamar Village 12,744 — 12,744 — 8/1/2019 3.64% (2)(5) 59 Springs at Gilbert Meadows 26,280 — 26,280 — 4/1/2025 2.07% (1)(3) 81 Yorba Linda 67,500 — 67,500 — 6/1/2020 1.94% (1)(3) 233 Villages at Bonita Glen 27,323 2,355 29,678 — 10/1/2023 5.33% (2)(3) 152 $ 572,615 $ 2,943 $ 575,558 $ 444,168 (1) Variable rate based on one-month LIBOR of 0.1930% (as of September 30, 2015 ) plus a fixed margin. (2) Fixed rate. (3) Monthly interest-only payment currently required. (4) Monthly fixed principal plus interest payment required. (5) Fixed monthly principal and interest payment required. (6) On October 1, 2015, this loan automatically extended for one year at a variable rate based on one-month LIBOR plus a fixed margin. Loans assumed as part of the Villages at Bonita Glen, South Lamar Village, Paladin, Sunset Ridge and Maxwell acquisitions were recorded at their fair value. The fair value adjustments are amortized over the remaining term of the loans and included in interest expense. For the three months ended September 30, 2015 and 2014 , interest expense was reduced by $228,000 and $121,000 , respectively, for the amortization of the fair value adjustments. For the nine months ended September 30, 2015 and 2014 , interest expense was reduced by $602,000 and $426,000 , respectively, for the amortization of the fair value adjustments. All mortgage notes are collateralized by a first mortgage lien on the assets of the respective property as named in the table above. The amount outstanding on the mortgages may be prepaid in full during the entire term with a prepayment penalty on the majority of mortgages held. As of September 30, 2015 and December 31, 2014 , the Company had $9.6 million and $6.9 million of restricted cash related to escrow deposits held by mortgage lenders for real estate taxes, insurance and capital reserves. Annual principal payments on the mortgage notes payable, excluding the amortization of the fair value adjustments, for each of the next five 12-month periods ending September 30, and thereafter, are as follows (in thousands): 2016 $ 69,154 2017 7,336 2018 27,696 2019 90,127 2020 122,820 Thereafter 255,482 $ 572,615 The mortgage notes payable are recourse only with respect to the properties that secure the notes, subject to certain limited standard exceptions, as defined in each mortgage note. The Company has guaranteed the mortgage notes by executing a guarantee with respect to the properties. These exceptions are referred to as “carveouts.” In general, carveouts relate to damages suffered by the lender for a borrower’s failure to pay rents, insurance or condemnation proceeds to lender, failure to pay water, sewer and other public assessments or charges, failure to pay environmental compliance costs or to deliver books and records, in each case as required in the loan documents. The exceptions also require the Company to guarantee payment of audit costs, lender’s enforcement of its rights under the loan documents and payment of the loan if the borrower voluntarily files for bankruptcy or seeks reorganization, or if a related party of the borrower does so with respect to the subsidiary. The Company has also guaranteed the completion and payment of costs of completion of no less than $7.0 million for renovations to The Estates at Johns Creek by July 1, 2018. The mortgage obtained in connection with the acquisition of Yorba Linda in June 2015 includes a $7.5 million earn-out holdback which may be borrowed when certain debt service coverage and loan to value criteria are met. The Yorba Linda loan includes a net worth and liquidity covenant. The Company was in compliance with all covenants at September 30, 2015 . The loan also includes an additional debt service coverage covenant that is only required to be met as of December 31, 2017 and periods thereafter. For the Fieldstone mortgage, beginning with the calendar quarter ended December 31, 2014, the property must maintain a certain level of debt service coverage. The Company was in compliance with the debt covenants for the Fieldstone mortgage at September 30, 2015 . |
CREDIT FACILITIES
CREDIT FACILITIES | 9 Months Ended |
Sep. 30, 2015 | |
Line of Credit Facility [Abstract] | |
CREDIT FACILITIES | NOTE 11 - CREDIT FACILITIES The following is a summary of the credit facilities (in thousands, except percentages): Weighted Average Interest Rate for the Balance Outstanding at Current Availability at Balance Outstanding at Maturity Interest Rate Basis (1) Current Three Months Ended Nine Months Ended Lender September 30, 2015 December 31, 2014 2015 2014 2015 2014 Bank of America $ 22,894 $ 4,732 10,086 5/23/2017 LIBOR plus 3% 3.19% 3.20% 3.15% 3.20% 3.15% US Bank 23,000 — 23,000 12/27/2017 LIBOR plus 1.95% 2.14% 2.20% 2.14% 2.15% 2.14% PNC Bank 12,500 — 12,500 12/20/2018 LIBOR plus 2% 2.19% 2.19% 2.15% 2.18% 2.16% $ 58,394 $ 4,732 $ 45,586 (1) Variable rate based on one-month LIBOR of 0.1930% (as of September 30, 2015 ). Draws under the secured revolving credit facility (the “Bank of America Credit Facility”) with Bank of America, N.A. (“Bank of America”) are secured by certain of the Company's properties with an aggregate value of $55.5 million as of September 30, 2015 and are guaranteed by the Company. The Bank of America Credit Facility, as amended, matures on May 23, 2017 , and may be extended to May 23, 2019 subject to satisfaction of certain conditions and payment of an extension fee equal to 0.25% of the amount committed under the Bank of America Credit Facility. The Company is required to make monthly interest-only payments. The Company also may prepay the Bank of America Credit Facility in whole or in part at any time without premium or penalty. The operating partnership's obligations with respect to the Bank of America Credit Facility are guaranteed by the Company, pursuant to the terms of a guaranty dated as of December 2, 2011, or the Guaranty. The Bank of America Credit Facility and the Guaranty contain restrictive covenants for maintaining a certain tangible net worth and a certain level of liquid assets, and for restricting the securing of additional debt as follows: • the Company must maintain a minimum tangible net worth equal to the lesser of (i) 200% of the outstanding principal amount of the Bank of America Credit Facility and (ii) $20.0 million ; • the Company must also maintain unencumbered liquid assets with a market value of not less than the greater of (i) $5.0 million or (ii) 20% of the outstanding principal amount of the Bank of America Credit Facility; and • the Company may not incur any additional secured or unsecured debt without Bank of America's prior written consent and approval, which consent and approval is not to be unreasonably withheld. On December 20, 2013 , the Company, through a wholly-owned subsidiary, entered into a secured credit facility, ("Jefferson Point Credit Facility") with PNC Bank, National Association for $15.0 million . Draws under the Jefferson Point Credit Facility are secured by the assets of Tech Center Square Apartments (formerly known as the Jefferson Point Apartments). The Company provided a repayment guarantee of all interest and scheduled monthly principal payments (excluding the final payment at maturity for the outstanding balance.) The Company paid certain closing costs in connection with the Jefferson Point Credit Facility, including loan fees totaling $75,000 . The Jefferson Point Credit Facility includes both a debt service coverage covenant and a tangible net worth covenant. In November 2014, the Company amended the Jefferson Point Credit Facility. In accordance with the amendment, the debt service coverage covenant is only required to be complied with as of December 31, 2015 and periods thereafter. On December 27, 2013 , the Company, through a wholly-owned subsidiary, entered into a secured credit facility ("Brentdale Credit Facility") with U.S. Bank National Association for $29.7 million . Draws under the Brentdale Credit Facility are secured by the assets of The Westside Apartments (formerly known as the Brentdale Apartments). The Company provided a $6.5 million repayment guarantee. The Brentdale Credit Facility matures on December 27, 2017 , and may be extended to December 27, 2019 subject to satisfaction of certain conditions and payment of an extension fee equal to 0.25% of the amount committed under the Brentdale Credit Facility. The Brentdale Credit Facility includes net worth, liquidity, leverage and debt service coverage covenants. In June 2015, the Company amended the Brentdale Credit Facility to amend the property debt service coverage ratio. The Company was in compliance with all loan covenants at September 30, 2015 . Annual principal payments on the credit facilities for each of the next five 12-month periods ending September 30, and thereafter are as follows (in thousands): 2016 $ — 2017 24,238 2018 22,740 2019 11,416 2020 — Thereafter — $ 58,394 |
DEFERRED FINANCING COSTS
DEFERRED FINANCING COSTS | 9 Months Ended |
Sep. 30, 2015 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
DEFERRED FINANCING COSTS | NOTE 12 - DEFERRED FINANCING COSTS Deferred financing costs incurred to obtain financing are amortized over the term of the related debt. During the three months ended September 30, 2015 and September 30, 2014 , $472,000 and $314,000 , respectively, of amortization of deferred financing costs was included in interest expense. During the nine months ended September 30, 2015 and September 30, 2014 , amortization of deferred financing costs was $1.4 million and $880,000 , respectively. Accumulated amortization as of September 30, 2015 and December 31, 2014 was $2.7 million and $1.5 million , respectively. Estimated amortization of the existing deferred financing costs for the next five 12-month periods ending September 30, and thereafter, is as follows (in thousands): 2016 $ 1,783 2017 1,585 2018 1,228 2019 999 2020 730 Thereafter 895 $ 7,220 |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE LOSS | 9 Months Ended |
Sep. 30, 2015 | |
Equity [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE LOSS | NOTE 13 - ACCUMULATED OTHER COMPREHENSIVE LOSS The following table presents the changes in each component of accumulated other comprehensive loss for the nine months ended September 30, 2015 (in thousands): Net unrealized loss January 1, 2015 $ (266 ) Unrealized loss on designated derivatives (173 ) September 30, 2015 $ (439 ) |
CERTAIN RELATIONSHIPS AND RELAT
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS | 9 Months Ended |
Sep. 30, 2015 | |
Related Party Transactions [Abstract] | |
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS | NOTE 14 - CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS In the ordinary course of its business operations, the Company has ongoing relationships with several related parties. Relationship with RAI Self-insurance funds held in escrow . Substantially all of the receivables from related parties represents escrow funds held by RAI for self insurance. The Company's properties participate in insurance pools with other properties directly and indirectly managed by RAI for both property insurance and general liability. RAI holds the escrow funds related to the insurance pools on its books. The insurance pool for the property insurance covers losses up to $2.5 million and the insurance pool for the general liability covers losses up to the first $25,000 per incident. Catastrophic insurance would cover property losses in excess of the insurance pool up to $140.0 million . Therefore, unforeseen or catastrophic losses in excess of the Company's insured limits could have a material adverse effect on the Company's financial condition and operating results. Internal audit fees . RAI performs internal audit services for the Company. Relationship with the Advisor In September 2009, the Company entered into an advisory agreement (the “Advisory Agreement”) pursuant to which the Advisor provides the Company with investment management, administrative and related services. The Advisory Agreement was amended in January 2010 and further amended in January 2011 and March 2015. The Advisory Agreement has a one -year term and renews for an unlimited number of successive one -year terms upon the approval of the conflicts committee of the Company's board of directors. The Company renewed the Advisory Agreement for another year on September 15, 2015. Under the Advisory Agreement, the Advisor receives fees and is reimbursed for its expenses as set forth below: Acquisition fees. The Company pays the Advisor an acquisition fee of 2.0% of the cost of investments acquired on behalf of the Company, plus any capital expenditure reserves allocated, or the amount funded by the Company to acquire loans, including acquisition expenses and any debt attributable to such investments. Asset management fees. The Company pays the Advisor a monthly asset management fee equal to one-twelfth of 1.0% of the higher of the cost or the independently appraised value of each asset, without deduction for depreciation, bad debts or other non-cash reserves. The asset management fee is based only on the portion of the costs or value attributable to the Company’s investment in an asset if the Company does not own all or a majority of an asset and does not manage or control the asset. Disposition fees. The Advisor earns a disposition fee in connection with the sale of a property equal to the lesser of one-half of the aggregate brokerage commission paid, or if none is paid, 2.75% of the contract sales price. Debt financing fees. The Advisor earns a debt financing fee equal to 0.5% of the amount available under any debt financing obtained for which it provided substantial services. Expense reimbursements. The Company also pays directly or reimburses the Advisor for all of the expenses paid or incurred by the Advisor or its affiliates on behalf of the Company or in connection with the services provided to the Company in relation to its public offering, including its ongoing distribution reinvestment plan offering. This includes all organization and offering costs of up to 2.5% of gross offering proceeds. Reimbursements also include expenses the Advisor incurs in connection with providing services to the Company, including the Company’s allocable share of costs for Advisor personnel and overhead, out of pocket expenses incurred in connection with the selection and acquisition of properties or other real estate related debt investments, whether or not the Company ultimately acquires the investment. However, the Company will not reimburse the Advisor or its affiliates for employee costs in connection with services for which the Advisor earns acquisition or disposition fees. Relationship with Resource Real Estate Opportunity Manager Resource Real Estate Opportunity Manager, LLC (the “Manager”), an affiliate of the Advisor, manages the Company's real estate properties and real estate-related debt investments and coordinates the leasing of, and manages construction activities related to, some of the Company’s real estate properties pursuant to the terms of the management agreement with the Manager. Property management fees. The Manager earns 4.5% of the gross receipts from our properties, provided that for properties that are less than 75% occupied, the manager receives a minimum fee for the first 12 months of ownership for performing certain property management and leasing activities. Construction management fees. The Manager earns a construction management fee of 5.0% of actual aggregate costs to construct improvements, or to repair, rehab or reconstruct a property. Debt servicing fees. The Manager earns a debt servicing fee of 2.75% on payments received from loans held by the Company for investment. Expense reimbursement. During the ordinary course of business, the Manager or other affiliates of RAI may pay certain shared operating expenses on behalf of the Company. Relationship with Other Related Parties The Company has also made payment for legal services to the law firm of Ledgewood P.C. (“Ledgewood”). Until 1996, the Chairman of RAI was of counsel to Ledgewood. In connection with the termination of his affiliation with Ledgewood and its redemption of his interest, the Chairman continues to receive certain payments from Ledgewood. Until March 2006, a current executive of RAI was the managing member of Ledgewood. This executive remained of counsel to Ledgewood through June 2007, at which time he became an Executive Vice President of RAI. In connection with his separation, this executive was entitled to receive payments from Ledgewood through 2013. The Company utilizes the services of a printing company, Graphic Images, LLC (“Graphic Images”), whose principal owner is the father of RAI’s Chief Financial Officer. The amounts payable and the fees earned/expenses paid to such related parties are summarized in the following tables (in thousands): September 30, December 31, Receivables from related parties: RAI and affiliates $ 1,523 $ 1,148 Payables to related parties: Advisor: Operating expense reimbursements $ 237 $ 327 Resource Real Estate Opportunity Manager, LLC: Property management fees 587 436 Operating expense reimbursements 1,280 743 Other — 124 $ 2,104 $ 1,630 Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Fees earned / expenses paid to related parties: Advisor: Acquisition fees (1) $ — $ 2,585 $ 5,169 $ 8,189 Asset management fees (2) $ 2,770 $ 2,001 $ 7,479 $ 5,041 Disposition fees (3) $ 109 $ 271 $ 1,140 $ 421 Debt financing fees (4) $ — $ 250 $ 670 $ 1,396 Overhead allocation (5) $ 817 $ 641 $ 2,639 $ 1,556 Internal audit fees $ 9 $ — $ 23 $ — Resource Real Estate Opportunity Manager LLC: Property management fees (2) $ 1,246 $ 1,021 $ 3,484 $ 2,565 Construction management fees (6) $ 587 $ 530 $ 1,426 $ 1,206 Debt servicing fees (2) $ 4 $ 1 $ 29 $ 7 Other: Ledgewood $ 8 $ 43 $ 152 $ 143 Graphic Images $ 33 $ 4 $ 55 $ 37 (1) Included in Acquisition costs on the consolidated statements of operations and comprehensive loss. (2) Included in Management fees on the consolidated statements of operations and comprehensive loss. (3) Included in Net gain on dispositions on the consolidated statements of operations and comprehensive loss. (4) Included in Deferred financing costs, net, on the consolidated balance sheets. (5) Included in General and administrative costs on the consolidated statements of operations and comprehensive loss. (6) Included in Rental Properties, net, on the consolidated balance sheets. |
EQUITY
EQUITY | 9 Months Ended |
Sep. 30, 2015 | |
Equity [Abstract] | |
EQUITY | NOTE 15 - EQUITY Preferred Stock The Company’s charter authorizes the Company to issue 10.0 million shares of its $0.01 par value preferred stock. As of September 30, 2015 and December 31, 2014 , no shares of preferred stock were issued and outstanding. Common Stock As of September 30, 2015 , the Company had issued shares of its $0.01 par value common stock as follows (dollars in thousands): Shares Issued Gross Proceeds Shares issued through private offering 1,263,727 $ 12,582 Shares issued through primary public offering (1) 62,485,461 622,077 Shares issued through stock distributions 2,132,266 — Shares issued through distribution reinvestment plan 5,750,205 55,623 Shares issued in conjunction with the Advisor's initial investment, 15,500 155 Total 71,647,159 $ 690,437 Shares redeemed (612,636 ) Total shares outstanding as of September 30, 2015 71,034,523 (1) Includes 276,056 shares issued to the Advisor. Convertible Stock As of September 30, 2015 and December 31, 2014 , the Company had 50,000 shares of $0.01 par value convertible stock outstanding of which the Advisor and affiliated persons own 49,063 shares and outside investors own 937 shares. The convertible stock will convert into shares of the Company’s common stock upon the occurrence of (a) the Company having paid distributions to common stockholders that in the aggregate equal 100% of the price at which the Company originally sold the shares plus an amount sufficient to produce a 10% cumulative, non-compounded annual return on the shares at that price; or (b) if the Company lists its common stock on a national securities exchange and, on the 31st trading day after listing, the Company’s value based on the average trading price of its common stock since the listing, plus prior distributions, combine to meet the same 10% return threshold. Each of these two events is a “Triggering Event.” Upon a Triggering Event, the Company's convertible stock will, unless its advisory agreement has been terminated or not renewed on account of a material breach by its Advisor, generally be converted into a number of shares of common stock equal to 1 / 50,000 of the quotient of: (A) the lesser of (i) 25% of the amount, if any, by which (1) the value of the Company as of the date of the event triggering the conversion plus the total distributions paid to its stockholders through such date on the then-outstanding shares of its common stock exceeds (2) the sum of the aggregate issue price of those outstanding shares plus a 10% cumulative, non-compounded, annual return on the issue price of those outstanding shares as of the date of the event triggering the conversion, or (ii) 15% of the amount, if any, by which (1) the value of the Company as of the date of the event triggering the conversion plus the total distributions paid to its stockholders through such date on the then-outstanding shares of its common stock exceeds (2) the sum of the aggregate issue price of those outstanding shares plus a 6% cumulative, non-compounded, annual return on the issue price of those outstanding shares as of the date of the event triggering the conversion, divided by (B) the value of the Company divided by the number of outstanding shares of common stock, in each case, as of the date of the event triggering the conversion. Redemption of Securities During the three and nine months ended September 30, 2015 , the Company redeemed 197,718 and 397,800 of its common shares, respectively. The Company will not redeem in excess of 5% of the weighted-average number of shares outstanding during the 12 -month period immediately prior to the effective date of redemption. The Company's board of directors will determine at least quarterly whether it has sufficient excess cash to repurchase shares. Generally, the cash available for redemptions will be limited to proceeds from the Company's distribution reinvestment plan plus, if the Company has positive operating cash flow from the previous fiscal year, 1% of all operating cash flow from the previous year. All redemption requests tendered were honored during the three and nine months ended September 30, 2015 . The Company's Board of Directors, in its sole discretion, may suspend, terminate or amend the Company's share redemption program without stockholder approval upon 30 days ' notice if it determines that such suspension, termination or amendment is in the Company's best interest. The Company's board may also reduce the number of shares purchased under the share redemption program if it determines the funds otherwise available to fund the Company's share redemption program are needed for other purposes. These limitations apply to all redemptions, including redemptions sought upon a stockholder's death, qualifying disability or confinement to a long-term care facility. Distributions For the nine months ended September 30, 2015 , the Company paid aggregate distributions of $31.5 million , including $9.8 million of distributions paid in cash and $21.7 million of distributions reinvested in shares of common stock through the Company's distribution reinvestment plan, as follows (in thousands): Record Date Per Common Distribution Date Distributions Aggregate Total January 29, 2015 $0.05 January 30, 2015 $ 2,391 $ 1,070 $ 3,461 February 26, 2015 0.05 February 27, 2015 2,392 1,081 3,473 March 30, 2015 0.05 March 31, 2015 2,400 1,080 3,480 April 29, 2015 0.05 April 30, 2015 2,408 1,084 3,492 May 28, 2015 0.05 May 29, 2015 2,418 1,088 3,506 June 29, 2015 0.05 June 30, 2015 2,423 1,093 3,516 July 30, 2015 0.05 July 31, 2015 2,424 1,103 3,527 August 28, 2015 0.05 August 31, 2015 2,416 1,119 3,535 September 29, 2015 0.05 September 30, 2015 2,417 1,124 3,541 $ 21,689 $ 9,842 $ 31,531 Since its formation, the Company's Board of Directors has declared a total of seven quarterly stock distributions of 0.015 shares each, two quarterly stock distributions of 0.0075 shares each, one quarterly stock distribution of 0.00585 shares each, and two quarterly stock distributions of 0.005 shares each of its common stock outstanding. In connection with these stock distributions, the Company had increased its accumulated deficit by $21.3 million as of September 30, 2015 . |
FAIR VALUE MEASURES AND DISCLOS
FAIR VALUE MEASURES AND DISCLOSURES | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASURES AND DISCLOSURES | NOTE 16 - FAIR VALUE MEASURES AND DISCLOSURES In analyzing the fair value of its investments accounted for on a fair value basis, the Company follows the fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The Company determines fair value based on quoted prices when available or, if quoted prices are not available, through the use of alternative approaches, such as discounting the expected cash flows using market interest rates commensurate with the credit quality and duration of the investment. The fair value of cash, tenant receivables and accounts payable, approximate their carrying value due to their short nature. The hierarchy followed defines three levels of inputs that may be used to measure fair value: Level 1 - Quoted prices in active markets for identical assets and liabilities that the reporting entity has the ability to access at the measurement date. Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset and liability or can be corroborated with observable market data for substantially the entire contractual term of the asset or liability. Level 3 - Unobservable inputs that reflect the entity’s own assumptions about the assumptions that market participants would use in the pricing of the asset or liability and are consequently not based on market activity, but rather through particular valuation techniques. The determination of where an asset or liability falls in the hierarchy requires significant judgment. The Company evaluates its hierarchy disclosures each quarter; depending on various factors, it is possible that an asset or liability may be classified differently from quarter to quarter. However, the Company expects that changes in classifications between levels will be rare. Rental properties obtained through a foreclosed note are measured at fair value on a non-recurring basis. The fair value of rental properties is usually estimated based on information obtained from a number of sources, including information obtained about each property as a result of pre-acquisition due diligence, marketing and leasing activities. The Company allocates the purchase price of properties to acquired tangible assets, consisting of land, buildings, fixtures and improvements, and identified intangible lease assets and liabilities, consisting of the value of above-market and below-market leases, as applicable, the value of in-place leases and the value of tenant relationships, based in each case on their fair values. Derivatives (interest rate caps) which are reported at fair value in the consolidated balance sheets in Prepaid expenses and other assets are valued by a third-party pricing agent using an income approach with models that use, as their primary inputs, readily observable market parameters. This valuation process considers factors including interest rate yield curves, time value, credit and volatility factors. (Level 2) The following table presents information about the Company's assets measured at fair value on a recurring basis and indicates the fair value hierarchy of the valuation techniques utilized by the Company to determine such fair value as follows (in thousands): Level 1 Level 2 Level 3 Total September 30, 2015 Assets: Interest rate caps $ — $ 31 $ — $ 31 $ — $ 31 $ — $ 31 December 31, 2014 Assets: Interest rate caps $ — $ 114 $ — $ 114 $ — $ 114 $ — $ 114 The carrying and fair values of the Company’s loans held for investment and preferred equity investments, net, mortgage note payable and revolving credit facilities were as follows (in thousands): September 30, 2015 December 31, 2014 Carrying Amount Fair Value Carrying Amount Fair Value Loans held for investment and preferred equity investments, net $ 4,230 $ 4,669 $ 4,985 $ 4,985 Mortgage notes payable, net $ (575,558 ) $ (580,713 ) $ (444,168 ) $ (450,269 ) Credit facilities $ (58,394 ) $ (58,394 ) $ (45,586 ) $ (45,586 ) The fair value of the loans held for investment and preferred equity investments, net, was estimated using rates available to the Company for debt with similar terms and remaining maturities. (Level 3) The fair value of the mortgage notes payable was estimated using rates available to the Company for debt with similar terms and remaining maturities. (Level 3) The fair values of the three credit facilities equal the carrying amounts because the interest rate of each of the credit facilities is variable. (Level 3) |
DERIVATIVES AND HEDGING ACTIVIT
DERIVATIVES AND HEDGING ACTIVITIES | 9 Months Ended |
Sep. 30, 2015 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVES AND HEDGING ACTIVITIES | NOTE 17 - DERIVATIVES AND HEDGING ACTIVITIES Risk Management Objective of Using Derivatives The Company is exposed to certain risk arising from both its business operations and economic conditions. The Company principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. The Company manages economic risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of its debt funding and the use of derivative financial instruments. Specifically, the Company enters into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the value of which are determined by interest rates. The Company’s derivative financial instruments are used to manage differences in the amount, timing, and duration of the Company’s known or expected cash receipts and its known or expected cash payments principally related to the Company’s investments and borrowings. As a condition to certain of the Company’s financing facilities, from time to time the Company may be required to enter into certain derivative transactions as may be required by the lender. These transactions would generally be in line with the Company’s own risk management objectives and also served to protect the lender. Cash Flow Hedges of Interest Rate Risk The Company’s objectives in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish this objective, the Company entered into a total of six interest rate caps that were designated as cash flow hedges during 2013, 2014 and 2015. Interest rate caps designated as cash flow hedges involve the receipt of variable amounts from a counterparty if interest rates rise above the strike rate on the contract in exchange for an up-front premium. The effective portion of changes in the fair value of derivatives designated and that qualify as cash flow hedges is recorded in accumulated other comprehensive income and is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. During the three and nine months ended September 30, 2015 and the year end December 31, 2014, such derivatives were used to hedge the variable cash flows, indexed to USD-LIBOR, associated with existing variable-rate loan agreements. The ineffective portion of the change in fair value of the derivatives is recognized directly in earnings. During the three and nine months ended September 30, 2015 , the Company did not record any hedge ineffectiveness in earnings. Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are made on the Company’s variable-rate debt. As of September 30, 2015 , the Company had the following outstanding interest rate derivatives that were designated as cash flow hedges of interest rate risk (dollars in thousands): Interest Rate Derivative Number of Instruments Notional Maturity Dates Interest Rate Caps 6 $ 102,013 January 1, 2018 to April 1, 2019 Tabular Disclosure of Fair Values of Derivative Instruments on the Balance Sheet The table below presents the fair value of the Company’s derivative financial instruments as well as their classification in prepaid expenses and other assets on the Balance Sheet as of September 30, 2015 and December 31, 2014 (in thousands): Asset Derivatives Liability Derivatives September 30, 2015 December 31, 2014 September 30, 2015 December 31, 2014 Balance Sheet Fair Value Balance Sheet Fair Value Balance Sheet Fair Value Balance Sheet Fair Value Interest rate caps $ 31 Interest rate caps $ 114 — $ — — $ — |
OPERATING EXPENSE LIMITATION
OPERATING EXPENSE LIMITATION | 9 Months Ended |
Sep. 30, 2015 | |
OPERATING EXPENSE LIMITATION WAIVER [Abstract] | |
OPERATING EXPENSE LIMITATION | NOTE 18 - OPERATING EXPENSE LIMITATION Under its charter, the Company must limit its total operating expenses to the lesser of 2% of its average invested assets or 25% of its net income for the four most recently completed fiscal quarters, unless the conflicts committee of the Company’s board of directors has determined that such excess expenses were justified based on unusual and non-recurring factors. Operating expenses for the four quarters ended September 30, 2015 were in compliance with the charter imposed limitation. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2015 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 19 - SUBSEQUENT EVENTS In October 2015, the Company's Board of Directors declared a $0.05 per share cash distribution to its common stockholders of record at the close of business on each of the following record dates: October 29, 2015, November 27, 2015 and December 30, 2015. Such distributions were or are to be paid on October 30, 2015, November 30, 2015 and December 31, 2015. On November 4, 2015, the Company and its joint venture partner entered into an agreement to sell their interests in Conifer Place, located in Norcross, Georgia, for $42.5 million with an expected closing date in the first quarter of 2016. The Company expects to recognize a gain on the sale in the three months ended March 31, 2016. The Company has evaluated subsequent events and determined that no events have occurred, other than those disclosed above, which would require an adjustment to or additional disclosure in the consolidated financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN26
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries as follows: Subsidiary Apartment Complex Number of Units Property Location RRE Opportunity Holdings, LLC N/A N/A N/A Resource Real Estate Opportunity OP, LP N/A N/A N/A RRE Charlemagne Holdings, LLC N/A N/A N/A RRE 107th Avenue Holdings, LLC (“107th Avenue”) (c) N/A N/A RRE Westhollow Holdings, LLC (“Westhollow”) (b) N/A N/A RRE Crestwood Holdings, LLC (“Crestwood”) (a)(b) N/A N/A RRE Iroquois, LP (“Vista”) Vista Apartment Homes 133 Philadelphia, PA RRE Iroquois Holdings, LLC N/A N/A N/A RRE Campus Club Holdings, LLC (“Campus Club”) (b) N/A N/A RRE Bristol Holdings, LLC (“Bristol”) (c) N/A N/A RRE Cannery Holdings, LLC (“Cannery”) Cannery Lofts 156 Dayton, OH RRE Williamsburg Holdings, LLC (“Williamsburg”) Williamsburg 976 Cincinnati, OH WPL Holdings, LLC N/A (d) N/A Cincinnati, OH RRE Skyview Holdings, LLC ("Skyview") (c) N/A N/A RRE Park Forest Holdings, LLC ("Park Forest") Mosaic 216 Oklahoma City, OK RRE Foxwood Holdings, LLC ("Foxwood") (c) N/A N/A RRE Flagstone Holdings, LLC ("Flagstone") (c) N/A N/A RRE Deerfield Holdings, LLC ("Deerfield") Deerfield 166 Hermantown, MN RRE Kenwick Canterbury Holdings, LLC ("Kenwick & Canterbury") (c) N/A N/A RRE Armand Place Holdings, LLC ("Armand") Ivy at Clear Creek 244 Houston, TX RRE Autumn Wood Holdings, LLC ("Autumn Wood") Retreat at Rocky Ridge 206 Hoover, AL RRE Village Square Holdings, LLC ("Village Square") Trailpoint at the Woodlands 271 Houston, TX RRE Nob Hill Holdings, LLC ("Nob Hill") Affinity at Winter Park 192 Winter Park, FL RRE Brentdale Holdings, LLC ("Brentdale") The Westside Apartments 412 Plano, TX RRE Jefferson Point Holdings, LLC ("Jefferson Point") Tech Center Square 208 Newport News, VA RRE Centennial Holdings, LLC ("Centennial") Verona Apartment Homes 276 Littleton, CO RRE Pinnacle Holdings, LLC ("Pinnacle") Skyview Apartment Homes 224 Westminster, CO RRE Jasmine Holdings, LLC ("Jasmine") The Nesbit Palisades 437 Alpharetta, GA RRE River Oaks Holdings, LLC ("River Oaks") Maxwell Townhomes 314 San Antonio, TX RRE Nicollet Ridge Holdings, LLC ("Nicollet Ridge") Meridian Pointe 339 Burnsville, MN RRE Addison Place, LLC ("Addison Place") The Estates at Johns Creek 403 Alpharetta, GA PRIP Coursey, LLC ("Evergreen at Coursey Place") Evergreen at Coursey Place (e) 352 Baton Rouge, LA PRIP 3700, LLC ("Champion Farms") N/A (e) N/A N/A PRIP 10637, LLC ("Fieldstone") N/A (e) N/A N/A PRIP 500, LLC ("Pinehurst") Pinehurst (e) 146 Kansas City, MO PRIP 1102, LLC ("Pheasant Run") Pheasant Run (e) 160 Lee's Summit, MO PRIP 11128, LLC ("Retreat at Shawnee") Retreat at Shawnee (e) 342 Shawnee, KS PRIP 6700, LLC ("Hilltop Village") (b)(e) N/A N/A PRIP 3383, LLC ("Conifer Place") N/A (e) N/A N/A PRIP Stone Ridge, LLC ("Stone Ridge") N/A (e) N/A N/A PRIP Pines, LLC ("Pines of York") Pines of York (e) 248 Yorktown, VA PRIP 5060/6310, LLC ("Governor Park") (b)(e) N/A N/A RRE Chisholm Place Holdings LLC ("Chisholm Place") Chisholm Place 142 Plano, TX RRE Berkeley Run Holdings, LLC ("Berkley Run") Perimeter Circle 194 Atlanta, GA RRE Berkeley Trace Holdings LLC ("Berkley Trace") Perimeter 5550 165 Atlanta, GA RRE Merrywood LLC ("Merrywood") Aston at Cinco Ranch 228 Katy, TX RRE Sunset Ridge Holdings, LLC ("Sunset Ridge") Sunset Ridge 324 San Antonio, TX RRE Parkridge Place Holdings, LLC ("Parkridge Place") Calloway at Las Colinas 536 Irving, TX RRE Spring Hill Holdings, LLC ("Spring Hill") N/A N/A N/A RRE Woodmoor Holdings, LLC ("Woodmoor") South Lamar Village 208 Austin, TX RRE Gilbert Holdings, LLC ("Springs at Gilbert") Springs at Gilbert Meadows 459 Gilbert, AZ RRE Bonita Glen Holdings, LLC ("Bonita") Villages at Bonita Glen 295 Chula Vista, CA RRE Yorba Linda Holdings, LLC ("Yorba Linda") Yorba Linda 400 Yorba Linda, CA N/A - Not Applicable (a) - Discontinued operations (b) - Sold prior to 2015 (c) - Sold in 2015 (d) - Subsidiary holds a portion of the Williamsburg parking lot (e) - Wholly-owned subsidiary of RRE Charlemagne Holdings, LLC All intercompany accounts and transactions have been eliminated in consolidation. The consolidated financial statements reflect the Company's accounts and the accounts of the Company's majority-owned and/or controlled subsidiaries. The Company follows the provisions of Accounting Standards Codification (“ASC”) Topic 810, “Consolidation,” and accordingly consolidates entities that are variable interest entities (“VIEs”) where it has determined that it is the primary beneficiary of such entities. Once it has been determined that the Company holds a variable interest in a VIE, management performs a qualitative analysis to determine (i) if the Company has the power to direct the matters that most significantly impact the VIE's financial performance; and (ii) if the Company has the obligation to absorb the losses of the VIE that could potentially be significant to the VIE or the right to receive the benefits of the VIE that could potentially be significant to the VIE. If the Company's interest possesses both of these characteristics, the Company is deemed to be the primary beneficiary and would be required to consolidate the VIE. The Company will continually assess its involvement with VIEs and re-evaluate the requirement to consolidate them. Noncontrolling interests are presented and disclosed as a separate component of stockholders' equity (not as a liability or other item outside of stockholders' equity). Consolidated net loss includes the noncontrolling interests’ share of (loss) income. All changes in the Company’s ownership interest in a subsidiary are accounted for as stockholders' equity transactions if the Company retains its controlling financial interest in the subsidiary. The portions of these entities that the Company does not own are presented as noncontrolling interests as of the dates and for the periods presented in the consolidated financial statements. |
Use of Estimates | Use of Estimates The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Assets Held for Sale | Assets Held for Sale The Company presents the assets and liabilities of any rental properties which have been sold subsequent to the balance sheet date, or otherwise qualify as held for sale, separately in the Consolidated Balance Sheets. Real estate assets held for sale are measured at the lower of carrying amount or fair value less cost to sell. Both the real estate and the corresponding liabilities are presented separately in the consolidated balance sheets. Subsequent to classification of an asset as held for sale, no further depreciation is recorded. |
Rental Properties | Rental Properties The Company records acquired rental properties at fair value. The Company considers the period of future benefit of an asset to determine its appropriate useful life and depreciates using the straight line method. The Company anticipates the estimated useful lives of its assets by class as follows: Buildings 27.5 years Building improvements 3.0 to 27.5 years Tenant improvements Shorter of lease term or expected useful life |
Impairment of Long-Lived Assets | Impairment of Long Lived Assets When circumstances indicate the carrying value of a property may not be recoverable, the Company reviews the asset for permanent impairment. This review is based on an estimate of the future undiscounted cash flows, excluding interest charges, expected to result from the property’s use and eventual disposition. The review also considers factors such as expected future operating income, market and other applicable trends and residual value, as well as the effects of leasing demand, competition and other factors. An impairment loss will be recorded to the extent that the carrying value exceeds the estimated fair value of a property to be held and used. For properties held for sale, the impairment loss would be the adjustment to fair value less the estimated cost to dispose of the asset. |
Loans Held for Investment, Net | Loans Held for Investment, Net The Company records acquired performing loans held for investment at cost and reviews them for potential impairment at each balance sheet date. The Company considers a loan to be impaired if one of two conditions exists. The first condition is, if based on current information and events, management believes it is probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan agreement. The second condition is if the loan is deemed to be a troubled-debt restructuring (“TDR”) where a concession has been given to a borrower in financial difficulty. A TDR may not have an associated specific loan loss allowance if the principal and interest amount is considered recoverable based on current market conditions, expected collateral performance and/or guarantees made by the borrowers. The amount of impairment, if any, is measured by comparing the recorded amount of the loan to the present value of the expected cash flows or, as a practical expedient, the fair value of the collateral. If a loan is deemed to be impaired, the Company records a reserve for loan losses through a charge to income for any shortfall. Interest income from performing loans held for investment is recognized based on the contractual terms of the loan agreement. Fees related to any buy down of the interest rate are deferred as prepaid interest income and amortized over the term of the loan as an adjustment to interest income. The initial investment made in a purchased performing loan includes the amount paid to the seller plus fees. The initial investment frequently differs from the related loan’s principal amount at the date of the purchase. The difference is recognized as an adjustment of the yield over the life of the loan. Closing costs related to the purchase of a performing loan held for investment are amortized over the term of the loan and accreted as an adjustment to interest income. The Company may acquire real estate loans at a discount due to the credit quality of such loans and the respective borrowers under such loans. Revenues from these loans are recorded under the effective interest method. Under this method, an effective interest rate (“EIR”) is applied to the cost basis of the real estate loan held for investment. The EIR that is calculated when the loan held for investment is acquired remains constant and is the basis for subsequent impairment testing and income recognition. However, if the amount and timing of future cash collections are not reasonably estimable, the Company accounts for the real estate receivable on the cost recovery method. Under the cost recovery method of accounting, no income is recognized until the basis of the loan held for investment has been fully recovered. |
Preferred Equity Investment | Preferred Equity Investment The Company records preferred equity investments at cost and evaluates the collectibility of both interest and principal at each balance sheet date. A preferred equity investment is considered impaired when, based on current information and events, it is probable that the Company will not be able to collect all amounts due according to existing contractual terms. When an investment is impaired, the amount of the loss accrual is calculated by comparing the carrying amount of the investment to its estimated fair value. Fees paid, net of expenses, are deferred and recognized as an adjustment to interest and dividend income earned over the term of the agreement. Dividend income is recognized based on the contractual terms of the preferred equity agreement. |
Allocation of Purchase Price of Acquired and Foreclosed Assets | Allocation of the Purchase Price of Acquired and Foreclosed Assets The cost of rental properties acquired directly as fee interests and through foreclosing on a loan are allocated to net tangible and intangible assets based on their relative fair values . The Company allocates the purchase price of properties to acquired tangible assets, consisting of land, buildings, fixtures and improvements, and to identified intangible lease assets and liabilities, consisting of the value of above-market and below-market leases, as applicable, the value of in-place leases and the value of tenant relationships. Fair value estimates are based on information obtained from a number of sources, including information obtained about each property as a result of pre-acquisition due diligence, marketing and leasing activities. In addition, the Company may obtain independent appraisal reports. The information in the appraisal reports along with the aforementioned information available to the Company's management is used in allocating the purchase price. The independent appraisers have no involvement in management's allocation decisions other than providing market information. In allocating the purchase price, management also includes real estate taxes, insurance and other operating expenses and estimates of lost rentals at market rates during the expected lease-up period. Management also estimates costs to execute similar leases, including leasing commissions and legal and other related expenses, to the extent that such costs have not already been incurred in connection with a new lease origination as part of the transaction. The Company records above-market and below-market in-place lease values for acquired properties based on the present value (using an interest rate that reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to the in-place leases and (ii) management’s estimate of fair market lease rates for the corresponding in-place leases, measured over a period equal to the remaining non-cancelable term of the lease. The Company amortizes any capitalized above-market or below-market lease values as an increase or reduction to rental income over the remaining non-cancelable terms of the respective leases. The Company measures the aggregate value of other intangible assets acquired based on the difference between (i) the property valued with existing in-place leases adjusted to market rental rates and (ii) the property valued as if it were vacant. Management’s estimates of value are made using methods similar to those used by independent appraisers (e.g., discounted cash flow analysis). Factors to be considered by management in its analysis include an estimate of carrying costs during hypothetical expected lease-up periods considering current market conditions and costs to execute similar leases. The total amount of other intangible assets acquired is further allocated to customer relationship intangible values based on management’s evaluation of the specific characteristics of each tenant’s lease and the Company’s overall relationship with that respective tenant. Characteristics to be considered by management in allocating these values include the nature and extent of the Company’s existing relationships with the tenant, the tenant’s credit quality and expectations of lease renewals (including those existing under the terms of the lease agreement), among other factors. The Company amortizes the value of in-place leases to expense over the average remaining term of the respective leases. The value of customer relationship intangibles are amortized to expense over the initial term and any renewal periods in the respective leases, but in no event will the amortization periods for the intangible assets exceed the remaining depreciable life of the building. Should a tenant terminate its lease, the unamortized portion of the in-place lease value and customer relationship intangibles associated with that tenant would be charged to expense in that period. The determination of the fair value of assets and liabilities acquired requires the use of significant assumptions with regard to current market rental rates, discount rates and other variables. The use of inappropriate estimates would result in an incorrect assessment of the purchase price allocations, which could impact the amount of the Company’s reported net income. Initial purchase price allocations are subject to change until all information is finalized, which is generally within one year of the acquisition date. |
Goodwill | Goodwill The Company records the excess of the cost of an acquired entity over the net of the amounts assigned to assets acquired (including identified intangible assets) and liabilities assumed as goodwill. Goodwill is not amortized but is tested for impairment at a level of reporting referred to as a reporting unit during the fourth quarter of each calendar year, or more frequently if events or changes in circumstances indicate that the asset might be impaired. |
Revenue Recognition | Revenue Recognition The Company recognizes minimum rent, including rental abatements and contractual fixed increases attributable to operating leases, on a straight-line basis over the term of the related lease and includes amounts expected to be received in later years in deferred rents. The Company records property operating expense reimbursements due from tenants for common area maintenance, real estate taxes and other recoverable costs in the period in which the related expenses are incurred. |
Tenant Receivables | Tenant Receivables Tenant receivables are stated in the financial statements as amounts due from tenants net of an allowance for uncollectible receivables. Payment terms vary and receivables outstanding longer than the payment terms are considered past due. The Company determines its allowance by considering a number of factors, including the length of time receivables are past due, security deposits held, the Company’s previous loss history, the tenants’ current ability to pay their obligations to the Company, the condition of the general economy and the industry as a whole. The Company writes off receivables when they become uncollectible. |
Income Taxes | Income Taxes To maintain its REIT qualification for U.S. federal income tax purposes, the Company is generally required to distribute at least 90% of its taxable net income (excluding net capital gains) to its stockholders as well as comply with other requirements, including certain asset, income and stock ownership tests. As a REIT, the Company is not subject to federal corporate income tax to the extent that it distributes 100% of its REIT taxable income each year. If the Company fails to qualify as a REIT, and does not qualify for certain statutory relief provisions, it is subject to U.S. federal, state and local income taxes and may be precluded from qualifying as a REIT for the subsequent four taxable years following the year in which it fails its REIT qualification. Accordingly, the Company’s failure to qualify as a REIT could have a material adverse impact on its results of operations and amounts available for distribution to its stockholders. The dividends-paid deduction of a REIT for qualifying dividends to its stockholders is computed using the Company’s taxable income as opposed to net income reported on the financial statements. Generally, taxable income differs from net income reported on the financial statements because the determination of taxable income is based on tax provisions and not financial accounting principles. The Company may elect to treat certain of its subsidiaries as taxable REIT subsidiaries (“TRS”). In general, the Company’s TRSs may hold assets and engage in activities that the Company cannot hold or engage in directly and generally may engage in any real estate or non-real estate-related business. A TRS is subject to U.S. federal, state and local corporate income taxes. As of September 30, 2015 and December 31, 2014 , the Company had no TRSs. The Company evaluates the benefits from tax positions taken or expected to be taken in its tax return. Only the largest amount of benefits from tax positions that will more likely than not be sustainable upon examination are recognized by the Company. The Company does not have any unrecognized tax benefits, nor interest and penalties, recorded in its consolidated financial statements and does not anticipate significant adjustments to the total amount of unrecognized tax benefits within the next 12 months. The Company is subject to examination by the U.S. Internal Revenue Service and by the taxing authorities in other states in which the Company has significant business operations. The Company is not currently undergoing any examinations by taxing authorities. |
Earnings Per Share | Earnings Per Share Basic earnings per share are computed by dividing income available to common stockholders by the weighted-average common shares outstanding during the period. Diluted earnings per share takes into account the potential dilution that could occur if securities or other contracts to issue common stock were exercised and converted to common stock. |
Reclassifications | Reclassifications Certain amounts in the prior period financial statements have been reclassified to conform to the current period presentation. The impact of the reclassifications made to prior period financial statements are not material and did not effect net income (loss). |
Adoption of New Accounting Standards | Adoption of New Accounting Standards Accounting Standards Issued But Not Yet Effective In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update (“ASU”)("ASU No. 2014-09"), “Revenue from Contracts with Customers”, which will replace most existing revenue recognition guidance in GAAP. The core principle of ASU No. 2014-09 is that an entity should recognize revenue for the transfer of goods or services equal to the amount that it expects to be entitled to receive for those goods or services. ASU No. 2014-09 requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments. ASU No. 2014-09 will be effective for the Company beginning January 1, 2018, including interim periods in 2018, and allows for both retrospective and prospective methods of adoption. The Company is in the process of determining the method of adoption and assessing the impact of this guidance on the Company’s consolidated financial position, results of operations and cash flows. In August 2014, FASB issued ASU No. 2014-15, "Presentation of Financial Statements-Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern." Under the new guidance, an entity should evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued. The guidance is effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. The adoption of the new requirements is not expected to have a material impact on the Company's consolidated financial statements. In January 2015, FASB issued ASU No. 2015-01, "Income Statement - Extraordinary and Unusual Items (Subtopic 225-20), Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items" (“ASU No. 2015-01”). The amendments in ASU No. 2015-01 eliminate from GAAP the concept of extraordinary items. Although the amendment will eliminate the requirements for reporting entities to consider whether an underlying event or transaction is extraordinary, the presentation and disclosure guidance for items that are unusual in nature or occur infrequently will be retained and will be expanded to include items that are both unusual in nature and infrequently occurring. ASU No. 2015-01 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015. Early adoption is permitted provided that the guidance is applied from the beginning of the fiscal year of adoption. The Company does not expect the adoption of ASU No. 2015-01 to have a significant impact on its consolidated financial statements. In February 2015, FASB issued ASU 2015-02, "Consolidation (Topic 810): Amendments to the Consolidation Analysis" (“ASU 2015-02”), which makes certain changes to both the variable interest model and the voting model, including changes to (1) the identification of variable interests (fees paid to a decision maker or service provider), (2) the variable interest entity characteristics for a limited partnership or similar entity and (3) the primary beneficiary determination. ASU 2015-02 is effective for the Company beginning January 1, 2016. The Company is continuing to evaluate this guidance; however, it does not expect the adoption of ASU 2015-02 to have a significant impact on its consolidated financial statements. In April 2015, FASB issued ASU 2015-03, "Simplifying the Presentation of Debt Issuance Costs" ("ASU 2015-03"), which requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected. Upon adoption, the Company will apply the new guidance on a retrospective basis and adjust the balance sheet of each individual period presented to reflect the period-specific effects of applying the new guidance. This guidance is effective for the Company beginning January 1, 2016. The Company is continuing to evaluate this guidance; however, it does not expect the adoption of ASU 2015-03 to have a significant impact on its consolidated financial statements. In September 2015, FASB issued ASU 2015-16, "Simplifying the Accounting for Measurement-Period Adjustments" ("ASU 2015-16"), which eliminates the requirement to retroactively revise comparative financial information for prior periods presented in financial statements due to changes in provisional amounts recorded for acquisitions in subsequent periods. Upon adoption, disclosure of the amounts recorded in current-period earnings that would have been recorded in previous reporting periods if the adjustment to the provisional amounts had been recognized at the acquisition date are required. ASU 2015-16 is effective for the Company beginning January 1, 2016. The Company is continuing to evaluate this guidance; however, it does not expect the adoption of ASU 2015-16 to have a significant impact on its consolidated financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN27
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Wholly Owned Subsidiaries Information | The consolidated financial statements include the accounts of the Company's majority-owned and/or controlled subsidiaries as follows: Subsidiary Ownership % Apartment Complex Number Property Location Springhurst Housing Partners, LLC 70.0% Champion Farms 264 Louisville, KY Glenwood Housing Partners I, LLC 83.0% Fieldstone 266 Woodlawn, OH FPA/PRIP Conifer, LLC 42.5% Conifer Place 420 Norcross, GA DT Stone Ridge, LLC 77.7% Stone Ridge 188 Columbia, SC The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries as follows: Subsidiary Apartment Complex Number of Units Property Location RRE Opportunity Holdings, LLC N/A N/A N/A Resource Real Estate Opportunity OP, LP N/A N/A N/A RRE Charlemagne Holdings, LLC N/A N/A N/A RRE 107th Avenue Holdings, LLC (“107th Avenue”) (c) N/A N/A RRE Westhollow Holdings, LLC (“Westhollow”) (b) N/A N/A RRE Crestwood Holdings, LLC (“Crestwood”) (a)(b) N/A N/A RRE Iroquois, LP (“Vista”) Vista Apartment Homes 133 Philadelphia, PA RRE Iroquois Holdings, LLC N/A N/A N/A RRE Campus Club Holdings, LLC (“Campus Club”) (b) N/A N/A RRE Bristol Holdings, LLC (“Bristol”) (c) N/A N/A RRE Cannery Holdings, LLC (“Cannery”) Cannery Lofts 156 Dayton, OH RRE Williamsburg Holdings, LLC (“Williamsburg”) Williamsburg 976 Cincinnati, OH WPL Holdings, LLC N/A (d) N/A Cincinnati, OH RRE Skyview Holdings, LLC ("Skyview") (c) N/A N/A RRE Park Forest Holdings, LLC ("Park Forest") Mosaic 216 Oklahoma City, OK RRE Foxwood Holdings, LLC ("Foxwood") (c) N/A N/A RRE Flagstone Holdings, LLC ("Flagstone") (c) N/A N/A RRE Deerfield Holdings, LLC ("Deerfield") Deerfield 166 Hermantown, MN RRE Kenwick Canterbury Holdings, LLC ("Kenwick & Canterbury") (c) N/A N/A RRE Armand Place Holdings, LLC ("Armand") Ivy at Clear Creek 244 Houston, TX RRE Autumn Wood Holdings, LLC ("Autumn Wood") Retreat at Rocky Ridge 206 Hoover, AL RRE Village Square Holdings, LLC ("Village Square") Trailpoint at the Woodlands 271 Houston, TX RRE Nob Hill Holdings, LLC ("Nob Hill") Affinity at Winter Park 192 Winter Park, FL RRE Brentdale Holdings, LLC ("Brentdale") The Westside Apartments 412 Plano, TX RRE Jefferson Point Holdings, LLC ("Jefferson Point") Tech Center Square 208 Newport News, VA RRE Centennial Holdings, LLC ("Centennial") Verona Apartment Homes 276 Littleton, CO RRE Pinnacle Holdings, LLC ("Pinnacle") Skyview Apartment Homes 224 Westminster, CO RRE Jasmine Holdings, LLC ("Jasmine") The Nesbit Palisades 437 Alpharetta, GA RRE River Oaks Holdings, LLC ("River Oaks") Maxwell Townhomes 314 San Antonio, TX RRE Nicollet Ridge Holdings, LLC ("Nicollet Ridge") Meridian Pointe 339 Burnsville, MN RRE Addison Place, LLC ("Addison Place") The Estates at Johns Creek 403 Alpharetta, GA PRIP Coursey, LLC ("Evergreen at Coursey Place") Evergreen at Coursey Place (e) 352 Baton Rouge, LA PRIP 3700, LLC ("Champion Farms") N/A (e) N/A N/A PRIP 10637, LLC ("Fieldstone") N/A (e) N/A N/A PRIP 500, LLC ("Pinehurst") Pinehurst (e) 146 Kansas City, MO PRIP 1102, LLC ("Pheasant Run") Pheasant Run (e) 160 Lee's Summit, MO PRIP 11128, LLC ("Retreat at Shawnee") Retreat at Shawnee (e) 342 Shawnee, KS PRIP 6700, LLC ("Hilltop Village") (b)(e) N/A N/A PRIP 3383, LLC ("Conifer Place") N/A (e) N/A N/A PRIP Stone Ridge, LLC ("Stone Ridge") N/A (e) N/A N/A PRIP Pines, LLC ("Pines of York") Pines of York (e) 248 Yorktown, VA PRIP 5060/6310, LLC ("Governor Park") (b)(e) N/A N/A RRE Chisholm Place Holdings LLC ("Chisholm Place") Chisholm Place 142 Plano, TX RRE Berkeley Run Holdings, LLC ("Berkley Run") Perimeter Circle 194 Atlanta, GA RRE Berkeley Trace Holdings LLC ("Berkley Trace") Perimeter 5550 165 Atlanta, GA RRE Merrywood LLC ("Merrywood") Aston at Cinco Ranch 228 Katy, TX RRE Sunset Ridge Holdings, LLC ("Sunset Ridge") Sunset Ridge 324 San Antonio, TX RRE Parkridge Place Holdings, LLC ("Parkridge Place") Calloway at Las Colinas 536 Irving, TX RRE Spring Hill Holdings, LLC ("Spring Hill") N/A N/A N/A RRE Woodmoor Holdings, LLC ("Woodmoor") South Lamar Village 208 Austin, TX RRE Gilbert Holdings, LLC ("Springs at Gilbert") Springs at Gilbert Meadows 459 Gilbert, AZ RRE Bonita Glen Holdings, LLC ("Bonita") Villages at Bonita Glen 295 Chula Vista, CA RRE Yorba Linda Holdings, LLC ("Yorba Linda") Yorba Linda 400 Yorba Linda, CA N/A - Not Applicable (a) - Discontinued operations (b) - Sold prior to 2015 (c) - Sold in 2015 (d) - Subsidiary holds a portion of the Williamsburg parking lot (e) - Wholly-owned subsidiary of RRE Charlemagne Holdings, LLC |
Estimated Useful Lives of Assets | The Company anticipates the estimated useful lives of its assets by class as follows: Buildings 27.5 years Building improvements 3.0 to 27.5 years Tenant improvements Shorter of lease term or expected useful life |
SUPPLEMENTAL CASH FLOW INFORM28
SUPPLEMENTAL CASH FLOW INFORMATION (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Cash Flow Information | The following table presents supplemental cash flow information (in thousands): Nine Months Ended September 30, 2015 2014 Non-cash financing and investing activities: Stock issued from the distribution reinvestment plan $ 21,689 $ 14,181 Stock distributions issued — 3,333 Cash distributions on common stock declared but not yet paid — 4,561 Deferred financing costs and escrow deposits funded directly by mortgage note and revolving credit facility 10,709 3,767 Assets and liabilities assumed in acquisitions: Other assets assumed — 3,231 Debt assumed 40,185 158,061 Other liabilities assumed 99 3,204 Noncontrolling interests — 18,901 Rental properties, net 40,284 176,935 Cash paid during the period for: Interest $ 15,172 $ 8,420 |
RENTAL PROPERTIES, NET (Tables)
RENTAL PROPERTIES, NET (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Real Estate Investments, Net [Abstract] | |
Summary of Investments in Rental Properties | The Company’s investments in rental properties consisted of the following (in thousands): September 30, December 31, Land $ 190,617 $ 122,137 Building and improvements 828,420 666,912 Furniture, fixtures and equipment 28,055 21,495 Construction in progress 4,215 3,005 1,051,307 813,549 Less: accumulated depreciation (66,243 ) (38,295 ) $ 985,064 $ 775,254 |
LOANS HELD FOR INVESTMENT AND30
LOANS HELD FOR INVESTMENT AND PREFERRED EQUITY INVESTMENT, NET (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Investments, Debt and Equity Securities [Abstract] | |
Components of Investments | The following table presents the components of loans held for investment and preferred equity investment, net (in thousands): September 30, December 31, Loans held for investment, net $ 755 $ 1,523 Preferred equity investment, net 3,475 3,462 $ 4,230 $ 4,985 |
Aging of Loans Held for Investment and Preferred Equity Method Investment | The following table provides the aging of the Company’s loans held for investment and preferred equity investment(dollars in thousands): September 30, 2015 December 31, 2014 Loans held for investment Preferred equity investments Total Loans held for investment Preferred equity investments Total Current $ 755 $ 3,475 $ 4,230 $ 1,523 $ 3,462 $ 4,985 Delinquent: 30−89 days — — — — — — 90−180 days — — — — — — Greater than 180 days — — — — — — $ 755 $ 3,475 $ 4,230 $ 1,523 $ 3,462 $ 4,985 |
Schedule of Credit Quality of Loans Held for Investment, Net, and Preferred Equity Investment | The following table provides information about the credit quality of the Company’s loans held for investment, net and preferred equity investment (in thousands): September 30, December 31, Performing $ 4,230 $ 4,985 Nonperforming — — Total $ 4,230 $ 4,985 |
Terms of Loans Held for Investment | The following table presents details of the balance and terms of the loan held for investment and the preferred equity investment held at September 30, 2015 (in thousands): Unpaid Principal Balance Unamortized Discount Deferred (fees) expenses, net Net book value Maturity Date Interest Rate Average monthly payment Loan- Trail Ridge $ 986 $ (239 ) $ 8 $ 755 10/28/2021 7.5% $ 8 Preferred equity investment 3,500 — (25 ) 3,475 4/1/2017 12% $ 35 $ 4,486 $ (239 ) $ (17 ) $ 4,230 The following table presents details of the balance and terms of loans held for investment and the preferred equity investment held at December 31, 2014 (in thousands): Unpaid Principal Balance Unamortized (Discount) Deferred (fees) expenses, net Net book value Loan- Trail Ridge $ 994 $ (261 ) $ 14 $ 747 Loan- Heatherwood 776 — — 776 Preferred equity investment 3,500 — (38 ) 3,462 $ 5,270 $ (261 ) $ (24 ) $ 4,985 |
ACQUISITIONS AND FORECLOSURES (
ACQUISITIONS AND FORECLOSURES (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Business Combinations [Abstract] | |
Schedule of purchase price allocation | The table below summarizes the Company's wholly-owned acquisitions during the nine months ended September 30, 2015 and the respective fair values assigned (dollars in thousands): Multifamily City and State Date of Purchase (1) Land Building and Furniture, Fixture and Equipment Intangible Assets Other Assets Other Fair Valued Villages at Bonita Glen Chula Vista, CA 6/16/2015 $ 49,050 $ 17,208 $ 32,651 $ 506 $ 1,130 $ 9 $ (30,008 ) $ 21,496 Yorba Linda Yorba Linda, CA 6/1/2015 118,000 39,322 76,124 590 1,964 76 (232 ) 117,844 Springs at Gilbert Meadows Gilbert, AZ 3/19/2015 36,000 8,487 25,867 716 931 — (152 ) 35,849 South Lamar Village Austin, TX 2/26/2015 24,000 5,586 17,493 291 629 — (12,961 ) 11,038 (1) Purchase price excludes closing costs and acquisition expenses. |
Schedule of Revenues, Losses and Acquisition Costs | The table below summarizes the total revenues, net losses, and acquisition costs of the Company's acquisitions during the three and nine months ended September 30, 2015 (dollars in thousands): Three Months Ended September 30, 2015 Nine Months Ended September 30, 2015 Multifamily Community Total Revenues Net Loss Acquisition Costs Total Revenues Net Loss Acquisition Costs South Lamar Village $ 622 $ 401 $ — $ 1,503 $ 1,200 $ 692 Springs at Gilbert Meadows 954 538 — 2,043 1,809 1,005 Yorba Linda 1,925 1,265 — 2,548 2,324 2,761 Villages at Bonita Glen 1,114 660 — 1,299 1,431 1,351 $ 4,615 $ 2,864 $ — $ 7,393 $ 6,764 $ 5,809 |
MEASUREMENT PERIOD ADJUSTMENTS
MEASUREMENT PERIOD ADJUSTMENTS (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Changes and Error Corrections [Abstract] | |
Schedule of Measurement Period Adjustments | Changes in the Paladin and The Estates at Johns Creek acquisitions are reflected in the tables below (in thousands): Paladin January 28, 2014 Measurement (1) January 28, 2014 Land $ 44,292 $ (19,420 ) $ 24,872 Building 149,155 18,364 167,519 Personal property — 3,530 3,530 Intangible assets 5,861 (96 ) 5,765 Other assets 3,231 (9 ) 3,222 Goodwill 6,412 (5,148 ) 1,264 Liabilities (140,970 ) 4,442 (136,528 ) Total net identifiable net assets $ 67,981 $ 1,663 $ 69,644 (1) Remaining balance ( $1.7 million ) of measurement period adjustments adjusted the noncontrolling interest balance. The Estates at Johns Creek March 28, 2014 Measurement March 28, 2014 Land $ 18,137 $ (11,784 ) $ 6,353 Building 51,843 10,406 62,249 Personal property — 509 509 Intangible assets 520 869 1,389 Total net identifiable net assets $ 70,500 $ — $ 70,500 |
DISPOSITION OF PROPERTIES (Tabl
DISPOSITION OF PROPERTIES (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Summary of Disposition Activity | The following table presents details of our disposition activity during the three and nine months ended September 30, 2015 and 2014 (in thousands): Multifamily Community Location Sale Date Sales price Gain (Loss) on Sale 2015 Dispositions: The Alcove Apartments Houston, Texas January 26, 2015 $ 11,050 $ 3,784 107th Avenue Apartments Omaha, Nebraska January 29, 2015 250 50 The Redford Apartments Houston, Texas February 27, 2015 32,959 15,303 Cityside Apartments Houston, Texas March 2, 2015 24,500 10,028 One Hundred Chevy Chase Lexington, Kentucky June 30, 2015 13,500 4,386 The Reserve at Mt. Moriah Memphis, Tennessee September 18, 2015 5,425 2,490 $ 87,684 $ 36,041 2014 Dispositions: Governor Park San Diego, California March 6, 2014 $ 456 $ — Campus Club Tampa, Florida June 16, 2014 10,500 2,588 Hilltop Village Kansas City, Missouri July 1, 2014 — (501 ) Arcadia at Westheimer Houston, Texas September 19, 2014 18,100 8,278 $ 29,056 $ 10,365 |
IDENTIFIED INTANGIBLE ASSETS,34
IDENTIFIED INTANGIBLE ASSETS, NET (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Rental and Antennae Leases | Expected amortization for the rental and antennae leases for the next five 12-month periods ending September 30, and thereafter, is as follows (in thousands): 2016 $ 1,757 2017 16 2018 16 2019 16 2020 16 Thereafter 85 $ 1,906 |
MORTGAGE NOTES PAYABLE, NET (Ta
MORTGAGE NOTES PAYABLE, NET (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Debt Disclosure [Abstract] | |
Summary of Mortgage Notes Payable | The following is a summary of the mortgage notes payable (in thousands, except percentages): September 30, 2015 December 31, 2014 Collateral Outstanding Borrowings Fair Value Adjustment Net Book Value Net Book Value Maturity Annual Average Vista Apartment Homes $ 15,663 $ — $ 15,663 $ 15,900 1/1/2022 2.48% (1)(5) $ 63 Cannery Lofts 8,190 — 8,190 8,190 9/1/2020 3.49% (1)(3) 37 Deerfield 10,530 — 10,530 10,530 11/1/2020 4.66% (2)(3) 54 Ivy at Clear Creek 8,467 — 8,467 8,574 11/1/2023 2.60% (1)(4) 29 Trailpoint at the Woodlands 19,093 — 19,093 19,335 11/1/2023 2.60% (1)(4) 66 Verona Apartment Homes 22,514 — 22,514 22,843 1/1/2019 3.60% (2)(5) 106 Skyview Apartment Homes 18,180 — 18,180 18,446 1/1/2019 3.60% (2)(5) 85 The Nesbit Palisades 20,298 — 20,298 20,298 7/1/2024 2.14% (1)(3) 53 Maxwell Townhomes 13,911 — 13,911 14,089 1/1/2022 4.32% (2)(5) 71 Champion Farms 16,350 139 16,489 16,634 7/1/2016 6.14% (2)(3) 85 Fieldstone 15,450 — 15,450 15,804 6/26/2016 2.59% (1)(4) 73 Pinehurst 4,137 7 4,144 4,239 1/1/2016 5.58% (2)(5) 28 Pheasant Run 6,250 114 6,364 6,407 10/1/2017 5.95% (2)(3) 31 Retreat of Shawnee 13,139 184 13,323 13,522 2/1/2018 5.58% (2)(5) 78 Conifer Crossing 27,253 — 27,253 27,762 9/1/2016 2.69% (1)(6) 122 Coursey Place 27,656 129 27,785 28,117 8/1/2021 5.07% (2)(5) 154 Pines of York 15,333 (380 ) 14,953 15,097 12/1/2021 4.46% (2)(5) 80 The Estates at Johns Creek 50,000 — 50,000 50,000 7/1/2020 3.38% (2)(3) 207 Chisholm Place 11,587 — 11,587 11,587 6/1/2024 2.58% (1)(3) 36 Perimeter 5550 14,006 — 14,006 14,211 7/1/2019 3.42% (2)(5) 64 Perimeter Circle 17,746 — 17,746 18,007 7/1/2019 3.42% (2)(5) 81 Aston at Cinco Ranch 23,872 — 23,872 24,162 10/1/2021 4.34% (2)(5) 120 Sunset Ridge 1 20,225 348 20,573 20,930 10/1/2020 4.58% (2)(5) 113 Sunset Ridge 2 3,016 47 3,063 3,109 10/1/2020 4.54% (2)(5) 16 Calloway at Las Colinas 35,902 — 35,902 36,375 12/1/2021 3.87% (2)(5) 171 South Lamar Village 12,744 — 12,744 — 8/1/2019 3.64% (2)(5) 59 Springs at Gilbert Meadows 26,280 — 26,280 — 4/1/2025 2.07% (1)(3) 81 Yorba Linda 67,500 — 67,500 — 6/1/2020 1.94% (1)(3) 233 Villages at Bonita Glen 27,323 2,355 29,678 — 10/1/2023 5.33% (2)(3) 152 $ 572,615 $ 2,943 $ 575,558 $ 444,168 (1) Variable rate based on one-month LIBOR of 0.1930% (as of September 30, 2015 ) plus a fixed margin. (2) Fixed rate. (3) Monthly interest-only payment currently required. (4) Monthly fixed principal plus interest payment required. (5) Fixed monthly principal and interest payment required. (6) On October 1, 2015, this loan automatically extended for one year at a variable rate based on one-month LIBOR plus a fixed margin. |
Annual Principal Payments on the Mortgage Notes Payable | Annual principal payments on the mortgage notes payable, excluding the amortization of the fair value adjustments, for each of the next five 12-month periods ending September 30, and thereafter, are as follows (in thousands): 2016 $ 69,154 2017 7,336 2018 27,696 2019 90,127 2020 122,820 Thereafter 255,482 $ 572,615 |
CREDIT FACILITIES (Tables)
CREDIT FACILITIES (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Line of Credit Facility [Abstract] | |
Summary of the Revolving Credit Facilities | The following is a summary of the credit facilities (in thousands, except percentages): Weighted Average Interest Rate for the Balance Outstanding at Current Availability at Balance Outstanding at Maturity Interest Rate Basis (1) Current Three Months Ended Nine Months Ended Lender September 30, 2015 December 31, 2014 2015 2014 2015 2014 Bank of America $ 22,894 $ 4,732 10,086 5/23/2017 LIBOR plus 3% 3.19% 3.20% 3.15% 3.20% 3.15% US Bank 23,000 — 23,000 12/27/2017 LIBOR plus 1.95% 2.14% 2.20% 2.14% 2.15% 2.14% PNC Bank 12,500 — 12,500 12/20/2018 LIBOR plus 2% 2.19% 2.19% 2.15% 2.18% 2.16% $ 58,394 $ 4,732 $ 45,586 (1) Variable rate based on one-month LIBOR of 0.1930% (as of September 30, 2015 ). |
Schedule of Principal Payments | Annual principal payments on the credit facilities for each of the next five 12-month periods ending September 30, and thereafter are as follows (in thousands): 2016 $ — 2017 24,238 2018 22,740 2019 11,416 2020 — Thereafter — $ 58,394 |
DEFERRED FINANCING COSTS (Table
DEFERRED FINANCING COSTS (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Estimated Amortization of Deferred Financing Costs | Estimated amortization of the existing deferred financing costs for the next five 12-month periods ending September 30, and thereafter, is as follows (in thousands): 2016 $ 1,783 2017 1,585 2018 1,228 2019 999 2020 730 Thereafter 895 $ 7,220 |
ACCUMULATED OTHER COMPREHENSI38
ACCUMULATED OTHER COMPREHENSIVE LOSS (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Equity [Abstract] | |
Components of Accumulated Other Comprehensive Loss | The following table presents the changes in each component of accumulated other comprehensive loss for the nine months ended September 30, 2015 (in thousands): Net unrealized loss January 1, 2015 $ (266 ) Unrealized loss on designated derivatives (173 ) September 30, 2015 $ (439 ) |
CERTAIN RELATIONSHIPS AND REL39
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Related Party Transactions [Abstract] | |
Fees Earned From/Expenses Paid to Related Parties | The amounts payable and the fees earned/expenses paid to such related parties are summarized in the following tables (in thousands): September 30, December 31, Receivables from related parties: RAI and affiliates $ 1,523 $ 1,148 Payables to related parties: Advisor: Operating expense reimbursements $ 237 $ 327 Resource Real Estate Opportunity Manager, LLC: Property management fees 587 436 Operating expense reimbursements 1,280 743 Other — 124 $ 2,104 $ 1,630 Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Fees earned / expenses paid to related parties: Advisor: Acquisition fees (1) $ — $ 2,585 $ 5,169 $ 8,189 Asset management fees (2) $ 2,770 $ 2,001 $ 7,479 $ 5,041 Disposition fees (3) $ 109 $ 271 $ 1,140 $ 421 Debt financing fees (4) $ — $ 250 $ 670 $ 1,396 Overhead allocation (5) $ 817 $ 641 $ 2,639 $ 1,556 Internal audit fees $ 9 $ — $ 23 $ — Resource Real Estate Opportunity Manager LLC: Property management fees (2) $ 1,246 $ 1,021 $ 3,484 $ 2,565 Construction management fees (6) $ 587 $ 530 $ 1,426 $ 1,206 Debt servicing fees (2) $ 4 $ 1 $ 29 $ 7 Other: Ledgewood $ 8 $ 43 $ 152 $ 143 Graphic Images $ 33 $ 4 $ 55 $ 37 (1) Included in Acquisition costs on the consolidated statements of operations and comprehensive loss. (2) Included in Management fees on the consolidated statements of operations and comprehensive loss. (3) Included in Net gain on dispositions on the consolidated statements of operations and comprehensive loss. (4) Included in Deferred financing costs, net, on the consolidated balance sheets. (5) Included in General and administrative costs on the consolidated statements of operations and comprehensive loss. (6) Included in Rental Properties, net, on the consolidated balance sheets. |
EQUITY (Tables)
EQUITY (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Equity [Abstract] | |
Schedule of Shares Issued | As of September 30, 2015 , the Company had issued shares of its $0.01 par value common stock as follows (dollars in thousands): Shares Issued Gross Proceeds Shares issued through private offering 1,263,727 $ 12,582 Shares issued through primary public offering (1) 62,485,461 622,077 Shares issued through stock distributions 2,132,266 — Shares issued through distribution reinvestment plan 5,750,205 55,623 Shares issued in conjunction with the Advisor's initial investment, 15,500 155 Total 71,647,159 $ 690,437 Shares redeemed (612,636 ) Total shares outstanding as of September 30, 2015 71,034,523 (1) Includes 276,056 shares issued to the Advisor. |
Schedule of Distributions | For the nine months ended September 30, 2015 , the Company paid aggregate distributions of $31.5 million , including $9.8 million of distributions paid in cash and $21.7 million of distributions reinvested in shares of common stock through the Company's distribution reinvestment plan, as follows (in thousands): Record Date Per Common Distribution Date Distributions Aggregate Total January 29, 2015 $0.05 January 30, 2015 $ 2,391 $ 1,070 $ 3,461 February 26, 2015 0.05 February 27, 2015 2,392 1,081 3,473 March 30, 2015 0.05 March 31, 2015 2,400 1,080 3,480 April 29, 2015 0.05 April 30, 2015 2,408 1,084 3,492 May 28, 2015 0.05 May 29, 2015 2,418 1,088 3,506 June 29, 2015 0.05 June 30, 2015 2,423 1,093 3,516 July 30, 2015 0.05 July 31, 2015 2,424 1,103 3,527 August 28, 2015 0.05 August 31, 2015 2,416 1,119 3,535 September 29, 2015 0.05 September 30, 2015 2,417 1,124 3,541 $ 21,689 $ 9,842 $ 31,531 |
FAIR VALUE MEASURES AND DISCL41
FAIR VALUE MEASURES AND DISCLOSURES (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Assets Measured at Fair Value on a Recurring Basis | The following table presents information about the Company's assets measured at fair value on a recurring basis and indicates the fair value hierarchy of the valuation techniques utilized by the Company to determine such fair value as follows (in thousands): Level 1 Level 2 Level 3 Total September 30, 2015 Assets: Interest rate caps $ — $ 31 $ — $ 31 $ — $ 31 $ — $ 31 December 31, 2014 Assets: Interest rate caps $ — $ 114 $ — $ 114 $ — $ 114 $ — $ 114 |
Carrying and Fair Values of the Company's Loans Held for Investment, Net, Mortgage Note Payable and Revolving Credit Facility | The carrying and fair values of the Company’s loans held for investment and preferred equity investments, net, mortgage note payable and revolving credit facilities were as follows (in thousands): September 30, 2015 December 31, 2014 Carrying Amount Fair Value Carrying Amount Fair Value Loans held for investment and preferred equity investments, net $ 4,230 $ 4,669 $ 4,985 $ 4,985 Mortgage notes payable, net $ (575,558 ) $ (580,713 ) $ (444,168 ) $ (450,269 ) Credit facilities $ (58,394 ) $ (58,394 ) $ (45,586 ) $ (45,586 ) |
DERIVATIVES AND HEDGING ACTIV42
DERIVATIVES AND HEDGING ACTIVITIES (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Outstanding Interest Rate Derivatives | As of September 30, 2015 , the Company had the following outstanding interest rate derivatives that were designated as cash flow hedges of interest rate risk (dollars in thousands): Interest Rate Derivative Number of Instruments Notional Maturity Dates Interest Rate Caps 6 $ 102,013 January 1, 2018 to April 1, 2019 |
Fair Value and Balance Sheet Location of Derivatives | The table below presents the fair value of the Company’s derivative financial instruments as well as their classification in prepaid expenses and other assets on the Balance Sheet as of September 30, 2015 and December 31, 2014 (in thousands): Asset Derivatives Liability Derivatives September 30, 2015 December 31, 2014 September 30, 2015 December 31, 2014 Balance Sheet Fair Value Balance Sheet Fair Value Balance Sheet Fair Value Balance Sheet Fair Value Interest rate caps $ 31 Interest rate caps $ 114 — $ — — $ — |
NATURE OF BUSINESS AND OPERAT43
NATURE OF BUSINESS AND OPERATIONS - Narrative (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | 51 Months Ended |
Sep. 30, 2015 | Dec. 31, 2014 | Dec. 13, 2013 | |
Securities Financing Transaction [Line Items] | |||
Entity organized date | Jun. 3, 2009 | ||
Common stock issued through distribution reinvestment plan | $ 21,689 | ||
Public Placement [Member] | |||
Securities Financing Transaction [Line Items] | |||
Common stock issued through distribution reinvestment plan (in shares) | 2,178,158 | 2,410,424 | 1,161,623 |
Common stock issued through distribution reinvestment plan | $ 21,700 | $ 22,900 | |
Public Placement [Member] | Common Stock [Member] | |||
Securities Financing Transaction [Line Items] | |||
Proceeds from issuance of stock under private offering | $ 645,800 | ||
Issuance of common stock (in shares) | 64,926,311 | ||
Public Placement [Member] | Common Stock [Member] | Advisor [Member] | |||
Securities Financing Transaction [Line Items] | |||
Issuance of common stock (in shares) | 276,056 |
SUMMARY OF SIGNIFICANT ACCOUN44
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Principles of Consolidation (Details) | Sep. 30, 2015Unit |
RRE Iroquois, LP [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 133 |
RRE Cannery Holdings, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 156 |
RRE Williamsburg Holdings, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 976 |
RRE Park Forest Holdings, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 216 |
RRE Deerfield Holdings, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 166 |
RRE Armand Place Holdings, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 244 |
RRE Autumn Wood Holdings, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 206 |
RRE Village Square Holdings, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 271 |
RRE Nob Hill Holdings, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 192 |
RRE Brentdale Holdings, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 412 |
RRE Jefferson Point Holdings, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 208 |
RRE Centennial Holdings, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 276 |
RRE Pinnacle Holdings, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 224 |
RRE Jasmine Holdings, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 437 |
RRE River Oaks Holdings, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 314 |
RRE Nicollet Ridge Holdings, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 339 |
PRIP Addison Place, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 403 |
PRIP Evergreen at Coursey Place, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 352 |
PRIP 500, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 146 |
PRIP 1102, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 160 |
PRIP 11128, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 342 |
PRIP Pines, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 248 |
RRE Chisolm Place Holdings LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 142 |
RRE Berkley Run Holdings, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 194 |
RRE Berkley Trace Holdings LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 165 |
RRE Merrywood LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 228 |
RRE Sunset Ridge Holdings, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 324 |
RRE Parkridge Place Holding, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 536 |
RRE Woodmoor Holdings, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 208 |
RRE Gilbert Holdings, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 459 |
RRE Bonita Glen Holdings, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 295 |
RRE Yorba Linda Holdings, LLC [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 400 |
Champion Farms [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 264 |
Ownership % | 70.00% |
Fieldstone [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 266 |
Ownership % | 83.00% |
Conifer Place [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 420 |
Ownership % | 42.50% |
Stone Ridge [Member] | |
Subsidiary or Equity Method Investee [Line Items] | |
Number of Units | 188 |
Ownership % | 77.70% |
SUMMARY OF SIGNIFICANT ACCOUN45
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Rental Property Useful Lives (Details) | 9 Months Ended |
Sep. 30, 2015 | |
Building [Member] | |
Real Estate Properties [Line Items] | |
Estimated useful lives | 27 years 6 months |
Building Improvements [Member] | Minimum [Member] | |
Real Estate Properties [Line Items] | |
Estimated useful lives | 3 years |
Building Improvements [Member] | Maximum [Member] | |
Real Estate Properties [Line Items] | |
Estimated useful lives | 27 years 6 months |
SUMMARY OF SIGNIFICANT ACCOUN46
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Narrative (Details) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2015USD ($) | Dec. 31, 2014USD ($)Property | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($)DistributionPropertyshares | Sep. 30, 2014USD ($) | Dec. 31, 2014USD ($)Property | |
Real Estate Assets Held for Development and Sale [Abstract] | ||||||
Number of Properties Held for Sale | Property | 0 | |||||
Asset Impairment Charges [Abstract] | ||||||
Impairment charges | $ 0 | $ 0 | $ 0 | $ 0 | ||
Allocation of Purchase Price of Acquired Assets [Abstract] | ||||||
Initial purchase price allocation subject to change, period | 1 year | |||||
Revenue Recognition [Abstract] | ||||||
Future minimum rental payments, thereafter | 0 | $ 0 | ||||
Tenant Receivable [Abstract] | ||||||
Allowance for uncollectable receivables | 35,881 | $ 57,300 | $ 35,881 | $ 57,300 | ||
Income Taxes [Abstract] | ||||||
Number of years entity may be precluded from REIT qualifications | 4 years | |||||
Earnings Per Share [Abstract] | ||||||
Antidilutive securities not included in the diluted earnings per share calculations | shares | 50,000 | |||||
Number of stock distributions | Distribution | 12 | |||||
Dividend Distribution One [Member] | ||||||
Earnings Per Share [Abstract] | ||||||
Number of stock distributions | Distribution | 7 | |||||
Dividend Distribution Two [Member] | ||||||
Earnings Per Share [Abstract] | ||||||
Number of stock distributions | Distribution | 2 | |||||
Dividend Distribution Three [Member] | ||||||
Earnings Per Share [Abstract] | ||||||
Number of stock distributions | Distribution | 1 | |||||
Dividend Distribution Four [Member] | ||||||
Earnings Per Share [Abstract] | ||||||
Number of stock distributions | Distribution | 2 | |||||
Common Stock [Member] | Dividend Distribution One [Member] | ||||||
Earnings Per Share [Abstract] | ||||||
Number of stock distributions | Distribution | 7 | |||||
Common stock dividend rate | 1.50% | |||||
Common Stock [Member] | Dividend Distribution Two [Member] | ||||||
Earnings Per Share [Abstract] | ||||||
Number of stock distributions | Distribution | 2 | |||||
Common stock dividend rate | 0.75% | |||||
Common Stock [Member] | Dividend Distribution Three [Member] | ||||||
Earnings Per Share [Abstract] | ||||||
Number of stock distributions | Distribution | 1 | |||||
Common stock dividend rate | 0.585% | |||||
Common Stock [Member] | Dividend Distribution Four [Member] | ||||||
Earnings Per Share [Abstract] | ||||||
Number of stock distributions | Distribution | 2 | |||||
Common stock dividend rate | 0.50% | |||||
Operating Leases (Excluding Commercial and Antenna Rentals) [Member] | ||||||
Revenue Recognition [Abstract] | ||||||
Future minimum rental, current | 60,400,000 | $ 60,400,000 | ||||
Future minimum rental payments, in two years | 314,000 | 314,000 | ||||
Commercial Rental Properties and Antenna Rentals [Member] | ||||||
Revenue Recognition [Abstract] | ||||||
Future minimum rental, current | 325,000 | 325,000 | ||||
Future minimum rental payments, in two years | 290,000 | 290,000 | ||||
Future minimum rental payments, in three years | 160,000 | 160,000 | ||||
Future minimum rental payments, in four years | 104,000 | 104,000 | ||||
Future minimum rental payments, in five years | 79,000 | 79,000 | ||||
Future minimum rental payments, thereafter | $ 0 | $ 0 | ||||
California [Member] | Geographic Concentration Risk [Member] | ||||||
Risks and Uncertainties [Abstract] | ||||||
Percentage of real estate investments | 17.00% | |||||
Texas [Member] | Geographic Concentration Risk [Member] | ||||||
Risks and Uncertainties [Abstract] | ||||||
Percentage of real estate investments | 25.00% | |||||
Georgia [Member] | Geographic Concentration Risk [Member] | ||||||
Risks and Uncertainties [Abstract] | ||||||
Percentage of real estate investments | 18.00% | |||||
The Alcove, Cityside Crossing and The Redford [Member] | ||||||
Real Estate Assets Held for Development and Sale [Abstract] | ||||||
Number of Properties Held for Sale | Property | 3 | 3 |
SUPPLEMENTAL CASH FLOW INFORM47
SUPPLEMENTAL CASH FLOW INFORMATION (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Non-cash financing and investing activities: | ||
Stock issued from the distribution reinvestment plan | $ 21,689 | $ 14,181 |
Stock distributions issued | 0 | 3,333 |
Cash distributions on common stock declared but not yet paid | 0 | 4,561 |
Deferred financing costs and escrow deposits funded directly by mortgage note and revolving credit facility | 10,709 | 3,767 |
Assets and liabilities assumed in acquisitions: | ||
Other assets assumed | 0 | 3,231 |
Debt assumed | 40,185 | 158,061 |
Other liabilities assumed | 99 | 3,204 |
Noncontrolling interests | 0 | 18,901 |
Rental properties, net | 40,284 | 176,935 |
Cash paid during the period for: | ||
Interest | $ 15,172 | $ 8,420 |
RENTAL PROPERTIES, NET (Details
RENTAL PROPERTIES, NET (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2015USD ($) | Dec. 31, 2014USD ($)Property | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($)Property | Sep. 30, 2014USD ($) | Dec. 31, 2014USD ($)Property | |
Investments in rental properties [Abstract] | ||||||
Land | $ 190,617 | $ 122,137 | $ 190,617 | $ 122,137 | ||
Building and improvements | 828,420 | 666,912 | 828,420 | 666,912 | ||
Furniture, fixtures and equipment | 28,055 | 21,495 | 28,055 | 21,495 | ||
Construction in progress | 4,215 | 3,005 | 4,215 | 3,005 | ||
Rental properties, gross | 1,051,307 | 813,549 | 1,051,307 | 813,549 | ||
Less: accumulated depreciation | (66,243) | (38,295) | (66,243) | (38,295) | ||
Rental properties, net | 985,064 | $ 775,254 | 985,064 | $ 775,254 | ||
Depreciation expense | 11,300 | $ 9,000 | 30,600 | $ 23,400 | ||
Gain (loss) on disposal of assets | (337) | (2,473) | $ (2,818) | (4,121) | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Number of Properties Held for Sale | Property | 0 | |||||
Sales price | $ 87,684 | $ 29,056 | $ 87,684 | $ 29,056 | ||
The Alcove, Cityside Crossing and The Redford [Member] | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Number of Properties Held for Sale | Property | 3 | 3 | ||||
Sales price | $ 36,800 | $ 36,800 |
LOANS HELD FOR INVESTMENT AND49
LOANS HELD FOR INVESTMENT AND PREFERRED EQUITY INVESTMENT, NET - Narrative (Details) | Nov. 12, 2014USD ($)Unit | Mar. 15, 2011USD ($)Loan | May. 31, 2015USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Dec. 31, 2014USD ($) | Apr. 18, 2013USD ($) |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||||
Number of nonperforming promissory notes | Loan | 2 | ||||||||
Number of performing promissory notes | Loan | 2 | ||||||||
Purchase price of promissory note | $ 3,100,000 | ||||||||
Loan made to purchaser | $ 4,486,000 | $ 4,486,000 | $ 5,270,000 | $ 800,000 | |||||
Proceeds from loans | $ 583,000 | ||||||||
Applied escrow balance | $ 58,000 | ||||||||
Impairment loss | 0 | $ 0 | (130,000) | $ 0 | |||||
Charge-offs | $ 0 | 130,000 | $ 0 | ||||||
Spring Hills Investors Limited Partner, LLC [Member] | |||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||||
Loan made to purchaser | $ 3,500,000 | $ 3,500,000 | $ 3,500,000 | ||||||
Payments to acquire preferred equity investment | $ 3,500,000 | ||||||||
Contractual obligation | 1,500,000 | ||||||||
Contractual obligation, incremental payment | $ 150,000 | ||||||||
Dividend receivable rate, percentage | 12.00% | ||||||||
Monthly dividend receivable rate, percentage | 7.00% | ||||||||
Spring Hills Investors Limited Partner, LLC [Member] | Multifamily Community [Member] | |||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||||
Number of units | Unit | 606 |
LOANS HELD FOR INVESTMENT AND50
LOANS HELD FOR INVESTMENT AND PREFERRED EQUITY INVESTMENT, NET - Components of Investments (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Investments, Debt and Equity Securities [Abstract] | ||
Loans held for investment, net | $ 755 | $ 1,523 |
Preferred equity investment, net | 3,475 | 3,462 |
Loans held for investment and preferred equity investments, net | $ 4,230 | $ 4,985 |
LOANS HELD FOR INVESTMENT AND51
LOANS HELD FOR INVESTMENT AND PREFERRED EQUITY INVESTMENT, NET - Aging Schedule of Investments (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Loans Held for Investment [Line Items] | ||
Loans held for investment | $ 755 | $ 1,523 |
Preferred equity investment, net | 3,475 | 3,462 |
Loans held for investment and preferred equity investments, net | 4,230 | 4,985 |
Current [Member] | ||
Loans Held for Investment [Line Items] | ||
Loans held for investment | 755 | 1,523 |
30-89 Days [Member] | ||
Loans Held for Investment [Line Items] | ||
Loans held for investment | 0 | 0 |
90-180 Days [Member] | ||
Loans Held for Investment [Line Items] | ||
Loans held for investment | 0 | 0 |
Greater than 180 Days [Member] | ||
Loans Held for Investment [Line Items] | ||
Loans held for investment | $ 0 | $ 0 |
LOANS HELD FOR INVESTMENT AND52
LOANS HELD FOR INVESTMENT AND PREFERRED EQUITY INVESTMENT, NET - Recorded Investment, Credit Quality Indicator (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Financing Receivable, Recorded Investment [Line Items] | ||
Loans held for investment and preferred equity investments, net | $ 4,230 | $ 4,985 |
Performing [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans held for investment and preferred equity investments, net | 4,230 | 4,985 |
Nonperforming [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans held for investment and preferred equity investments, net | $ 0 | $ 0 |
LOANS HELD FOR INVESTMENT AND53
LOANS HELD FOR INVESTMENT AND PREFERRED EQUITY INVESTMENT, NET - Terms of Loans Held for Investment (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2015 | Dec. 31, 2014 | Apr. 18, 2013 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Unpaid Principal Balance | $ 4,486 | $ 5,270 | $ 800 |
Unamortized Discount | (239) | (261) | |
Deferred (fees) expenses, net | (17) | (24) | |
Net book value | 4,230 | 4,985 | |
Spring Hills Investors Limited Partner, LLC [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Unpaid Principal Balance | 3,500 | 3,500 | |
Unamortized Discount | 0 | 0 | |
Deferred (fees) expenses, net | (25) | (38) | |
Net book value | $ 3,475 | 3,462 | |
Interest rate | 12.00% | ||
Average monthly payment | $ 35 | ||
Trail Ridge Note [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Unpaid Principal Balance | 986 | 994 | |
Unamortized Discount | (239) | (261) | |
Deferred (fees) expenses, net | 8 | 14 | |
Net book value | $ 755 | 747 | |
Interest rate | 7.50% | ||
Average monthly payment | $ 8 | ||
Heatherwood Note [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Unpaid Principal Balance | 776 | ||
Unamortized Discount | 0 | ||
Deferred (fees) expenses, net | 0 | ||
Net book value | $ 776 |
ACQUISITIONS AND FORECLOSURES -
ACQUISITIONS AND FORECLOSURES - Real Estate Investments (Details) $ in Thousands | Jun. 16, 2015USD ($) | Jun. 01, 2015USD ($) | Mar. 19, 2015USD ($) | Feb. 26, 2015USD ($) | Sep. 30, 2015Property | Sep. 30, 2015Property |
Business Acquisition [Line Items] | ||||||
Number of properties | Property | 36 | 36 | ||||
Number of properties acquired | Property | 0 | 4 | ||||
Valuation period for each property | 12 months | |||||
Villages at Bonita Glen [Member] | ||||||
Fair value of the net assets acquired: | ||||||
Purchase Price | $ 49,050 | |||||
Land | 17,208 | |||||
Building and Improvements | 32,651 | |||||
Furniture, Fixture and Equipment | 506 | |||||
Intangible Assets | 1,130 | |||||
Other Assets | 9 | |||||
Other Liabilities | (30,008) | |||||
Fair Valued Assigned | $ 21,496 | |||||
Yorba Linda [Member] | ||||||
Fair value of the net assets acquired: | ||||||
Purchase Price | $ 118,000 | |||||
Land | 39,322 | |||||
Building and Improvements | 76,124 | |||||
Furniture, Fixture and Equipment | 590 | |||||
Intangible Assets | 1,964 | |||||
Other Assets | 76 | |||||
Other Liabilities | (232) | |||||
Fair Valued Assigned | $ 117,844 | |||||
The Springs at Gilbert Meadows [Member] | ||||||
Fair value of the net assets acquired: | ||||||
Purchase Price | $ 36,000 | |||||
Land | 8,487 | |||||
Building and Improvements | 25,867 | |||||
Furniture, Fixture and Equipment | 716 | |||||
Intangible Assets | 931 | |||||
Other Assets | 0 | |||||
Other Liabilities | (152) | |||||
Fair Valued Assigned | $ 35,849 | |||||
South Lamar Village [Member] | ||||||
Fair value of the net assets acquired: | ||||||
Purchase Price | $ 24,000 | |||||
Land | 5,586 | |||||
Building and Improvements | 17,493 | |||||
Furniture, Fixture and Equipment | 291 | |||||
Intangible Assets | 629 | |||||
Other Assets | 0 | |||||
Other Liabilities | (12,961) | |||||
Fair Valued Assigned | $ 11,038 |
ACQUISITIONS AND FORECLOSURES55
ACQUISITIONS AND FORECLOSURES - Acquisitions (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Business Acquisition [Line Items] | ||||
Total Revenues | $ 30,845 | $ 26,875 | $ 86,991 | $ 72,675 |
Net Loss | 10,662 | $ 7,486 | 6,099 | $ 34,147 |
South Lamar Village [Member] | ||||
Business Acquisition [Line Items] | ||||
Total Revenues | 622 | 1,503 | ||
Net Loss | 401 | 1,200 | ||
Acquisition Costs | 0 | 692 | ||
The Springs at Gilbert Meadows [Member] | ||||
Business Acquisition [Line Items] | ||||
Total Revenues | 954 | 2,043 | ||
Net Loss | 538 | 1,809 | ||
Acquisition Costs | 0 | 1,005 | ||
Yorba Linda [Member] | ||||
Business Acquisition [Line Items] | ||||
Total Revenues | 1,925 | 2,548 | ||
Net Loss | 1,265 | 2,324 | ||
Acquisition Costs | 0 | 2,761 | ||
Villages at Bonita Glen [Member] | ||||
Business Acquisition [Line Items] | ||||
Total Revenues | 1,114 | 1,299 | ||
Net Loss | 660 | 1,431 | ||
Acquisition Costs | 0 | 1,351 | ||
Multifamily Community [Member] | ||||
Business Acquisition [Line Items] | ||||
Total Revenues | 4,615 | 7,393 | ||
Net Loss | 2,864 | 6,764 | ||
Acquisition Costs | $ 0 | $ 5,809 |
MEASUREMENT PERIOD ADJUSTMENT56
MEASUREMENT PERIOD ADJUSTMENTS (Details) - USD ($) $ in Thousands | 9 Months Ended | ||||
Sep. 30, 2014 | Sep. 30, 2015 | Dec. 31, 2014 | Mar. 28, 2014 | Jan. 28, 2014 | |
Business Acquisition [Line Items] | |||||
Goodwill | $ 1,231 | $ 1,231 | |||
Net income attributable to noncontrolling interest, period increase (decrease) | $ (249) | ||||
Paladin [Member] | |||||
Business Acquisition [Line Items] | |||||
Land | $ 24,872 | ||||
Building | 167,519 | ||||
Personal property | 3,530 | ||||
Intangible assets | 5,765 | ||||
Other assets | 3,222 | ||||
Goodwill | 1,264 | ||||
Liabilities | (136,528) | ||||
Identifiable net assets | 69,644 | ||||
Additional depreciation and amortization that would have been included, had final appraisals been received and recorded | $ 867 | ||||
Paladin [Member] | Initially Reported [Member] | |||||
Business Acquisition [Line Items] | |||||
Land | 44,292 | ||||
Building | 149,155 | ||||
Personal property | 0 | ||||
Intangible assets | 5,861 | ||||
Other assets | 3,231 | ||||
Goodwill | 6,412 | ||||
Liabilities | (140,970) | ||||
Identifiable net assets | 67,981 | ||||
Paladin [Member] | Measurement Period Adjustment [Member] | |||||
Business Acquisition [Line Items] | |||||
Land | (19,420) | ||||
Building | 18,364 | ||||
Personal property | 3,530 | ||||
Intangible assets | (96) | ||||
Other assets | (9) | ||||
Goodwill | (5,148) | ||||
Liabilities | 4,442 | ||||
Identifiable net assets | 1,663 | ||||
Noncontrolling interest | $ 1,700 | ||||
The Estates at Johns Creek [Member] | |||||
Business Acquisition [Line Items] | |||||
Land | $ 6,353 | ||||
Building | 62,249 | ||||
Personal property | 509 | ||||
Intangible assets | 1,389 | ||||
Identifiable net assets | 70,500 | ||||
The Estates at Johns Creek [Member] | Initially Reported [Member] | |||||
Business Acquisition [Line Items] | |||||
Land | 18,137 | ||||
Building | 51,843 | ||||
Personal property | 0 | ||||
Intangible assets | 520 | ||||
Identifiable net assets | 70,500 | ||||
The Estates at Johns Creek [Member] | Measurement Period Adjustment [Member] | |||||
Business Acquisition [Line Items] | |||||
Land | (11,784) | ||||
Building | 10,406 | ||||
Personal property | 509 | ||||
Intangible assets | 869 | ||||
Identifiable net assets | $ 0 |
DISPOSITION OF PROPERTIES (Deta
DISPOSITION OF PROPERTIES (Details) - USD ($) $ in Thousands | Sep. 18, 2015 | Jun. 30, 2015 | Mar. 02, 2015 | Feb. 27, 2015 | Jan. 29, 2015 | Jan. 26, 2015 | Sep. 19, 2014 | Jul. 01, 2014 | Jun. 16, 2014 | Mar. 06, 2014 | Sep. 30, 2015 | Sep. 30, 2014 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||
Sales price | $ 87,684 | $ 29,056 | ||||||||||
Gain (Loss) on Sale | $ 36,041 | $ 10,365 | ||||||||||
The Alcove - Houston, TX [Member] | ||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||
Sales price | $ 11,050 | |||||||||||
Gain (Loss) on Sale | $ 3,784 | |||||||||||
107th Avenue Apartments [Member] | ||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||
Sales price | $ 250 | |||||||||||
Gain (Loss) on Sale | $ 50 | |||||||||||
Redford Apartments [Member] | ||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||
Sales price | $ 32,959 | |||||||||||
Gain (Loss) on Sale | $ 15,303 | |||||||||||
Cityside Apartments [Member] | ||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||
Sales price | $ 24,500 | |||||||||||
Gain (Loss) on Sale | $ 10,028 | |||||||||||
One Hundred Chevy Chase Apartments [Member] | ||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||
Sales price | $ 13,500 | |||||||||||
Gain (Loss) on Sale | $ 4,386 | |||||||||||
The Reserve at Mount Moriah [Member] | ||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||
Sales price | $ 5,425 | |||||||||||
Gain (Loss) on Sale | $ 2,490 | |||||||||||
Governor Park [Member] | ||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||
Sales price | $ 456 | |||||||||||
Gain (Loss) on Sale | $ 0 | |||||||||||
Campus Club Apartments [Member] | ||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||
Sales price | $ 10,500 | |||||||||||
Gain (Loss) on Sale | $ 2,588 | |||||||||||
Hilltop Village [Member] | ||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||
Sales price | $ 0 | |||||||||||
Gain (Loss) on Sale | $ (501) | |||||||||||
Arcadia at Westheimer [Member] | ||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||
Sales price | $ 18,100 | |||||||||||
Gain (Loss) on Sale | $ 8,278 |
IDENTIFIED INTANGIBLE ASSETS,58
IDENTIFIED INTANGIBLE ASSETS, NET - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Finite-Lived Intangible Assets [Line Items] | |||||
Identified intangible assets, net | $ 1,906 | $ 1,906 | $ 2,081 | ||
Weighted average remaining life | 3 months | 5 months | |||
Amortization expense | 1,900 | $ 2,700 | $ 4,800 | $ 13,300 | |
Acquired in-place leases [Member] | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Identified intangible assets, net | 1,900 | 1,900 | $ 2,100 | ||
Accumulated amortization | 26,900 | 26,900 | $ 26,500 | ||
Antennae Leases [Member] | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Annual expected amortization expense through 2025 | $ 16 | $ 16 |
IDENTIFIED INTANGIBLE ASSETS,59
IDENTIFIED INTANGIBLE ASSETS, NET - Rental and Antennae Leases (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2,016 | $ 1,757 | |
2,017 | 16 | |
2,018 | 16 | |
2,019 | 16 | |
2,020 | 16 | |
Thereafter | 85 | |
Total | $ 1,906 | $ 2,081 |
MORTGAGE NOTES PAYABLE, NET - S
MORTGAGE NOTES PAYABLE, NET - Summary (Details) - USD ($) $ in Thousands | Oct. 01, 2015 | Sep. 30, 2015 | Dec. 31, 2014 |
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | $ 572,615 | ||
Fair Value Adjustment | 2,943 | ||
Net Book Value | 575,558 | $ 444,168 | |
Vista Apartment Homes [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | 15,663 | ||
Fair Value Adjustment | 0 | ||
Net Book Value | $ 15,663 | 15,900 | |
Mortgage loan, maturity date | Jan. 1, 2022 | ||
Mortgage note, annual interest rate | 2.48% | ||
Mortgage loan, average monthly debt service | $ 63 | ||
Vista Apartment Homes [Member] | Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Basis spread on variable rate | 0.193% | ||
Cannery Lofts [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | $ 8,190 | ||
Fair Value Adjustment | 0 | ||
Net Book Value | $ 8,190 | 8,190 | |
Mortgage loan, maturity date | Sep. 1, 2020 | ||
Mortgage note, annual interest rate | 3.49% | ||
Mortgage loan, average monthly debt service | $ 37 | ||
Cannery Lofts [Member] | Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Basis spread on variable rate | 0.193% | ||
Deerfield [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | $ 10,530 | ||
Fair Value Adjustment | 0 | ||
Net Book Value | $ 10,530 | 10,530 | |
Mortgage loan, maturity date | Nov. 1, 2020 | ||
Mortgage note, annual interest rate | 4.66% | ||
Mortgage loan, average monthly debt service | $ 54 | ||
Ivy at Clear Creek [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | 8,467 | ||
Fair Value Adjustment | 0 | ||
Net Book Value | $ 8,467 | 8,574 | |
Mortgage loan, maturity date | Nov. 1, 2023 | ||
Mortgage note, annual interest rate | 2.60% | ||
Mortgage loan, average monthly debt service | $ 29 | ||
Ivy at Clear Creek [Member] | Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Basis spread on variable rate | 0.193% | ||
Trailpoint at the Woodlands [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | $ 19,093 | ||
Fair Value Adjustment | 0 | ||
Net Book Value | $ 19,093 | 19,335 | |
Mortgage loan, maturity date | Nov. 1, 2023 | ||
Mortgage note, annual interest rate | 2.60% | ||
Mortgage loan, average monthly debt service | $ 66 | ||
Trailpoint at the Woodlands [Member] | Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Basis spread on variable rate | 0.193% | ||
Verona Apartment Homes [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | $ 22,514 | ||
Fair Value Adjustment | 0 | ||
Net Book Value | $ 22,514 | 22,843 | |
Mortgage loan, maturity date | Jan. 1, 2019 | ||
Mortgage note, annual interest rate | 3.60% | ||
Mortgage loan, average monthly debt service | $ 106 | ||
Skyview Apartment Homes [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | 18,180 | ||
Fair Value Adjustment | 0 | ||
Net Book Value | $ 18,180 | 18,446 | |
Mortgage loan, maturity date | Jan. 1, 2019 | ||
Mortgage note, annual interest rate | 3.60% | ||
Mortgage loan, average monthly debt service | $ 85 | ||
Nesbit Palisades [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | 20,298 | ||
Fair Value Adjustment | 0 | ||
Net Book Value | $ 20,298 | 20,298 | |
Mortgage loan, maturity date | Jul. 1, 2024 | ||
Mortgage note, annual interest rate | 2.14% | ||
Mortgage loan, average monthly debt service | $ 53 | ||
Nesbit Palisades [Member] | Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Basis spread on variable rate | 0.193% | ||
Maxwell Townhomes [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | $ 13,911 | ||
Fair Value Adjustment | 0 | ||
Net Book Value | $ 13,911 | 14,089 | |
Mortgage loan, maturity date | Jan. 1, 2022 | ||
Mortgage note, annual interest rate | 4.32% | ||
Mortgage loan, average monthly debt service | $ 71 | ||
Champion Farms [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | 16,350 | ||
Fair Value Adjustment | 139 | ||
Net Book Value | $ 16,489 | 16,634 | |
Mortgage loan, maturity date | Jul. 1, 2016 | ||
Mortgage note, annual interest rate | 6.14% | ||
Mortgage loan, average monthly debt service | $ 85 | ||
Fieldstone [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | 15,450 | ||
Fair Value Adjustment | 0 | ||
Net Book Value | $ 15,450 | 15,804 | |
Mortgage loan, maturity date | Jun. 26, 2016 | ||
Mortgage note, annual interest rate | 2.59% | ||
Mortgage loan, average monthly debt service | $ 73 | ||
Fieldstone [Member] | Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Basis spread on variable rate | 0.193% | ||
Pinehurst [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | $ 4,137 | ||
Fair Value Adjustment | 7 | ||
Net Book Value | $ 4,144 | 4,239 | |
Mortgage loan, maturity date | Jan. 1, 2016 | ||
Mortgage note, annual interest rate | 5.58% | ||
Mortgage loan, average monthly debt service | $ 28 | ||
Pheasant Run [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | 6,250 | ||
Fair Value Adjustment | 114 | ||
Net Book Value | $ 6,364 | 6,407 | |
Mortgage loan, maturity date | Oct. 1, 2017 | ||
Mortgage note, annual interest rate | 5.95% | ||
Mortgage loan, average monthly debt service | $ 31 | ||
Retreat at Shawnee [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | 13,139 | ||
Fair Value Adjustment | 184 | ||
Net Book Value | $ 13,323 | 13,522 | |
Mortgage loan, maturity date | Feb. 1, 2018 | ||
Mortgage note, annual interest rate | 5.58% | ||
Mortgage loan, average monthly debt service | $ 78 | ||
Conifer Crossing [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | 27,253 | ||
Fair Value Adjustment | 0 | ||
Net Book Value | $ 27,253 | 27,762 | |
Mortgage loan, maturity date | Sep. 1, 2016 | ||
Mortgage note, annual interest rate | 2.69% | ||
Mortgage loan, average monthly debt service | $ 122 | ||
Conifer Crossing [Member] | London Interbank Offered Rate (LIBOR) [Member] | Subsequent Event [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Debt Instrument, Interest Rate, Extension Period | 1 year | ||
Conifer Crossing [Member] | Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Basis spread on variable rate | 0.193% | ||
Coursey Place [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | $ 27,656 | ||
Fair Value Adjustment | 129 | ||
Net Book Value | $ 27,785 | 28,117 | |
Mortgage loan, maturity date | Aug. 1, 2021 | ||
Mortgage note, annual interest rate | 5.07% | ||
Mortgage loan, average monthly debt service | $ 154 | ||
Pines of York [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | 15,333 | ||
Fair Value Adjustment | (380) | ||
Net Book Value | $ 14,953 | 15,097 | |
Mortgage loan, maturity date | Dec. 1, 2021 | ||
Mortgage note, annual interest rate | 4.46% | ||
Mortgage loan, average monthly debt service | $ 80 | ||
The Estates at Johns Creek [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | 50,000 | ||
Fair Value Adjustment | 0 | ||
Net Book Value | $ 50,000 | 50,000 | |
Mortgage loan, maturity date | Jul. 1, 2020 | ||
Mortgage note, annual interest rate | 3.38% | ||
Mortgage loan, average monthly debt service | $ 207 | ||
Chisholm Place [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | 11,587 | ||
Fair Value Adjustment | 0 | ||
Net Book Value | $ 11,587 | 11,587 | |
Mortgage loan, maturity date | Jun. 1, 2024 | ||
Mortgage note, annual interest rate | 2.58% | ||
Mortgage loan, average monthly debt service | $ 36 | ||
Chisholm Place [Member] | Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Basis spread on variable rate | 0.193% | ||
Perimeter 5550 [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | $ 14,006 | ||
Fair Value Adjustment | 0 | ||
Net Book Value | $ 14,006 | 14,211 | |
Mortgage loan, maturity date | Jul. 1, 2019 | ||
Mortgage note, annual interest rate | 3.42% | ||
Mortgage loan, average monthly debt service | $ 64 | ||
Perimeter Circle [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | 17,746 | ||
Fair Value Adjustment | 0 | ||
Net Book Value | $ 17,746 | 18,007 | |
Mortgage loan, maturity date | Jul. 1, 2019 | ||
Mortgage note, annual interest rate | 3.42% | ||
Mortgage loan, average monthly debt service | $ 81 | ||
Aston at Cinco Ranch [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | 23,872 | ||
Fair Value Adjustment | 0 | ||
Net Book Value | $ 23,872 | 24,162 | |
Mortgage loan, maturity date | Oct. 1, 2021 | ||
Mortgage note, annual interest rate | 4.34% | ||
Mortgage loan, average monthly debt service | $ 120 | ||
Sunset Ridge 1 [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | 20,225 | ||
Fair Value Adjustment | 348 | ||
Net Book Value | $ 20,573 | 20,930 | |
Mortgage loan, maturity date | Oct. 1, 2020 | ||
Mortgage note, annual interest rate | 4.58% | ||
Mortgage loan, average monthly debt service | $ 113 | ||
Sunset Ridge 2 [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | 3,016 | ||
Fair Value Adjustment | 47 | ||
Net Book Value | $ 3,063 | 3,109 | |
Mortgage loan, maturity date | Oct. 1, 2020 | ||
Mortgage note, annual interest rate | 4.54% | ||
Mortgage loan, average monthly debt service | $ 16 | ||
Calloway at Las Colinas [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | 35,902 | ||
Fair Value Adjustment | 0 | ||
Net Book Value | $ 35,902 | 36,375 | |
Mortgage loan, maturity date | Dec. 1, 2021 | ||
Mortgage note, annual interest rate | 3.87% | ||
Mortgage loan, average monthly debt service | $ 171 | ||
South Lamar Village [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | 12,744 | ||
Fair Value Adjustment | 0 | ||
Net Book Value | $ 12,744 | 0 | |
Mortgage loan, maturity date | Aug. 1, 2019 | ||
Mortgage note, annual interest rate | 3.64% | ||
Mortgage loan, average monthly debt service | $ 59 | ||
The Springs at Gilbert Meadows [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | 26,280 | ||
Fair Value Adjustment | 0 | ||
Net Book Value | $ 26,280 | 0 | |
Mortgage loan, maturity date | Apr. 1, 2025 | ||
Mortgage note, annual interest rate | 2.07% | ||
Mortgage loan, average monthly debt service | $ 81 | ||
The Springs at Gilbert Meadows [Member] | Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Basis spread on variable rate | 0.193% | ||
Yorba Linda [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | $ 67,500 | ||
Fair Value Adjustment | 0 | ||
Net Book Value | $ 67,500 | 0 | |
Mortgage loan, maturity date | Jun. 1, 2020 | ||
Mortgage note, annual interest rate | 1.94% | ||
Mortgage loan, average monthly debt service | $ 233 | ||
Yorba Linda [Member] | Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Basis spread on variable rate | 0.193% | ||
Villages at Bonita Glen [Member] | |||
Participating Mortgage Loans [Line Items] | |||
Outstanding Borrowings | $ 27,323 | ||
Fair Value Adjustment | 2,355 | ||
Net Book Value | $ 29,678 | $ 0 | |
Mortgage loan, maturity date | Oct. 1, 2023 | ||
Mortgage note, annual interest rate | 5.33% | ||
Mortgage loan, average monthly debt service | $ 152 |
MORTGAGE NOTES PAYABLE, NET - A
MORTGAGE NOTES PAYABLE, NET - Annual Principal Payments (Details) $ in Thousands | Sep. 30, 2015USD ($) |
Debt Disclosure [Abstract] | |
2,016 | $ 69,154 |
2,017 | 7,336 |
2,018 | 27,696 |
2,019 | 90,127 |
2,020 | 122,820 |
Thereafter | 255,482 |
Total | $ 572,615 |
MORTGAGE NOTES PAYABLE, NET - N
MORTGAGE NOTES PAYABLE, NET - Narrative (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Guarantor Obligations [Line Items] | |||||
Restricted cash related to escrow deposits | $ 9,600,000 | $ 9,600,000 | $ 6,900,000 | ||
Payment guarantee | |||||
Guarantor Obligations [Line Items] | |||||
Guaranty for completion and payment of costs of completion (no less than) | 7,000,000 | 7,000,000 | |||
Acquisitions of Rental Property [Member] | Interest Expense [Member] | |||||
Guarantor Obligations [Line Items] | |||||
Increase (decrease) in interest expense due to fair value adjustments | (228,000) | $ (121,000) | (602,000) | $ (426,000) | |
Covenants included in Mortgage for Archstone Yorba Linda [Member] | |||||
Guarantor Obligations [Line Items] | |||||
Earn-out holdback allowed when criteria are met | $ 7,500,000 | $ 7,500,000 |
CREDIT FACILITIES - Summary of
CREDIT FACILITIES - Summary of Revolving Credit Facilities (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Line of Credit Facility [Line Items] | |||||
Credit facilities | $ 58,394 | $ 58,394 | $ 45,586 | ||
Line of Credit Facility, Current Availability | 4,732 | 4,732 | |||
Revolving Credit Facility [Member] | Bank of America [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Credit facilities | 22,894 | 22,894 | 10,086 | ||
Line of Credit Facility, Current Availability | $ 4,732 | $ 4,732 | |||
Line of Credit Facility, Current Interest Rate | 3.19% | 3.19% | |||
Line of Credit Facility, Weighted Average Interest Rate | 3.20% | 3.15% | 3.20% | 3.15% | |
Basis spread on variable rate | 3.00% | ||||
Revolving Credit Facility [Member] | U.S. Bank [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Credit facilities | $ 23,000 | $ 23,000 | 23,000 | ||
Line of Credit Facility, Current Interest Rate | 2.14% | 2.14% | |||
Line of Credit Facility, Weighted Average Interest Rate | 2.20% | 2.14% | 2.15% | 2.14% | |
Basis spread on variable rate | 1.95% | ||||
Revolving Credit Facility [Member] | PNC Bank [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Credit facilities | $ 12,500 | $ 12,500 | $ 12,500 | ||
Line of Credit Facility, Current Interest Rate | 2.19% | 2.19% | |||
Line of Credit Facility, Weighted Average Interest Rate | 2.19% | 2.15% | 2.18% | 2.16% | |
Basis spread on variable rate | 2.00% |
CREDIT FACILITIES - Schedule of
CREDIT FACILITIES - Schedule of Principal Payments (Details) $ in Thousands | Sep. 30, 2015USD ($) |
Line of Credit Facility [Line Items] | |
Total | $ 572,615 |
Revolving Credit Facility [Member] | |
Line of Credit Facility [Line Items] | |
2,016 | 0 |
2,017 | 24,238 |
2,018 | 22,740 |
2,019 | 11,416 |
2,020 | 0 |
Thereafter | 0 |
Total | $ 58,394 |
CREDIT FACILITIES - Narrative (
CREDIT FACILITIES - Narrative (Details) - USD ($) | Dec. 27, 2013 | Dec. 20, 2013 | Sep. 30, 2015 | Sep. 30, 2014 |
Line of Credit Facility [Line Items] | ||||
Paid closing costs | $ 402,000 | $ 3,440,000 | ||
Repayment Guarantee [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Repayment guaranty | 7,000,000 | |||
Revolving Credit Facility [Member] | Bank of America [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit facility collateral amount | $ 55,500,000 | |||
Line of credit facility, expiration date | May 23, 2017 | |||
Line of credit facility extended expiration date | May 23, 2019 | |||
Extension fee percentage | 0.25% | |||
Minimum tangible net worth to maintain, percent of outstanding principal amount of credit facility | 200.00% | |||
Minimum tangible net worth to maintain | $ 20,000,000 | |||
Minimum unencumbered liquid assets to maintain, market value | $ 5,000,000 | |||
Minimum unencumbered liquid assets to maintain, market value, percent of outstanding principal amount of credit facility | 20.00% | |||
Revolving Credit Facility [Member] | PNC Bank [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit facility, maximum borrowing capacity | $ 15,000,000 | |||
Paid closing costs | $ 75,000 | |||
Revolving Credit Facility [Member] | U.S. Bank [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Extension fee percentage | 0.25% | |||
Line of credit facility, maximum borrowing capacity | $ 29,700,000 | |||
Revolving Credit Facility [Member] | U.S. Bank [Member] | Repayment Guarantee [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Repayment guaranty | $ 6,500,000 |
DEFERRED FINANCING COSTS (Detai
DEFERRED FINANCING COSTS (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||||
Amortization of deferred financing costs | $ 472 | $ 314 | $ 1,378 | $ 880 | |
Accumulated amortization, deferred finance costs | 2,700 | 2,700 | $ 1,500 | ||
Amortization of Financing Costs and Discounts [Abstract] | |||||
2,016 | 1,783 | 1,783 | |||
2,017 | 1,585 | 1,585 | |||
2,018 | 1,228 | 1,228 | |||
2,019 | 999 | 999 | |||
2,020 | 730 | 730 | |||
Thereafter | 895 | 895 | |||
Deferred financing costs, net | $ 7,220 | $ 7,220 | $ 6,392 |
ACCUMULATED OTHER COMPREHENSI67
ACCUMULATED OTHER COMPREHENSIVE LOSS (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2015USD ($) | |
Accumulated Other Comprehensive Income [Rollforward] | |
Beginning balance | $ (266) |
Unrealized loss on designated derivatives | (173) |
Ending balance | (439) |
Net unrealized gain (loss) on derivatives [Member] | |
Accumulated Other Comprehensive Income [Rollforward] | |
Beginning balance | (266) |
Unrealized loss on designated derivatives | (173) |
Ending balance | $ (439) |
CERTAIN RELATIONSHIPS AND REL68
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS - Narrative (Details) | 9 Months Ended |
Sep. 30, 2015USD ($) | |
Related Party Transaction [Line Items] | |
Insurance pool, amount of general liability losses covered | $ 25,000 |
Terms of agreement | 1 year |
RAI [Member] | |
Related Party Transaction [Line Items] | |
Insurance pool, amount of property losses covered | $ 2,500,000 |
Catastrophic insurance, amount of losses covered | $ 140,000,000 |
Advisor [Member] | |
Related Party Transaction [Line Items] | |
Terms of agreement, renewal period | 1 year |
Percentage acquisition fee paid to advisor | 2.00% |
Monthly asset management fee | 0.08% |
Disposition fee | 50.00% |
Debt disposition fee, as a percentage of the contract sales price | 2.75% |
Debt financing fee | 0.50% |
Maximum reimbursement limit on gross offering proceeds | 2.50% |
Resource Real Estate Opportunity Manager LLC [Member] | |
Related Party Transaction [Line Items] | |
Property management fee | 4.50% |
Occupancy | 75.00% |
Term for which Manager receives minimum property management fee if properties are less than 75% occupied | 12 months |
Construction management fee | 5.00% |
Debt servicing fee | 2.75% |
CERTAIN RELATIONSHIPS AND REL69
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS - Schedule of Transactions (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Related Party Transaction [Line Items] | |||||
Receivables from related parties | $ 1,523 | $ 1,523 | $ 1,148 | ||
Payables to related parties | 2,104 | 2,104 | 1,630 | ||
Resource America, Inc. and Affiliates [Member] | Insurance fund held in escrow [Member] | |||||
Related Party Transaction [Line Items] | |||||
Receivables from related parties | 1,523 | 1,523 | 1,148 | ||
Advisor [Member] | Expense Reimbursements [Member] | |||||
Related Party Transaction [Line Items] | |||||
Payables to related parties | 237 | 237 | 327 | ||
Advisor [Member] | Acquisition Fees [Member] | |||||
Related Party Transaction [Line Items] | |||||
Fees earned / expenses paid to related parties | 0 | $ 2,585 | 5,169 | $ 8,189 | |
Advisor [Member] | Asset Management Fees [Member] | |||||
Related Party Transaction [Line Items] | |||||
Fees earned / expenses paid to related parties | 2,770 | 2,001 | 7,479 | 5,041 | |
Advisor [Member] | Disposition Fees [Member] | |||||
Related Party Transaction [Line Items] | |||||
Fees earned / expenses paid to related parties | 109 | 271 | 1,140 | 421 | |
Advisor [Member] | Debt Financing Fees [Member] | |||||
Related Party Transaction [Line Items] | |||||
Fees earned / expenses paid to related parties | 0 | 250 | 670 | 1,396 | |
Advisor [Member] | Overhead Allocation [Member] | |||||
Related Party Transaction [Line Items] | |||||
Fees earned / expenses paid to related parties | 817 | 641 | 2,639 | 1,556 | |
Advisor [Member] | Internal Audit Fees [Member] | |||||
Related Party Transaction [Line Items] | |||||
Fees earned / expenses paid to related parties | 9 | 0 | 23 | 0 | |
Resource Real Estate Opportunity Manager LLC [Member] | Expense Reimbursements [Member] | |||||
Related Party Transaction [Line Items] | |||||
Payables to related parties | 1,280 | 1,280 | 743 | ||
Resource Real Estate Opportunity Manager LLC [Member] | Property Management Fees [Member] | |||||
Related Party Transaction [Line Items] | |||||
Payables to related parties | 587 | 587 | 436 | ||
Fees earned / expenses paid to related parties | 1,246 | 1,021 | 3,484 | 2,565 | |
Resource Real Estate Opportunity Manager LLC [Member] | Construction Management Fees [Member] | |||||
Related Party Transaction [Line Items] | |||||
Fees earned / expenses paid to related parties | 587 | 530 | 1,426 | 1,206 | |
Resource Real Estate Opportunity Manager LLC [Member] | Debt Servicing Fees [Member] | |||||
Related Party Transaction [Line Items] | |||||
Fees earned / expenses paid to related parties | 4 | 1 | 29 | 7 | |
Other Related Party [Member] | |||||
Related Party Transaction [Line Items] | |||||
Payables to related parties | 0 | 0 | $ 124 | ||
Ledgewood P.C. [Member] | |||||
Related Party Transaction [Line Items] | |||||
Fees earned / expenses paid to related parties | 8 | 43 | 152 | 143 | |
Graphic Images LLC [Member] | |||||
Related Party Transaction [Line Items] | |||||
Fees earned / expenses paid to related parties | $ 33 | $ 4 | $ 55 | $ 37 |
EQUITY - Preferred Stock (Detai
EQUITY - Preferred Stock (Details) - $ / shares | Sep. 30, 2015 | Dec. 31, 2014 |
Equity [Abstract] | ||
Preferred stock, authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
EQUITY - Common Stock (Details)
EQUITY - Common Stock (Details) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Dec. 31, 2014 | |
Class of Stock [Line Items] | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Shares Issued | 71,647,159 | 69,469,001 |
Gross Proceeds | $ 690,437 | |
Shares redeemed | (612,636) | |
Total shares outstanding at end of period | 71,034,523 | |
Private Placement [Member] | ||
Class of Stock [Line Items] | ||
Shares Issued | 1,263,727 | |
Gross Proceeds | $ 12,582 | |
Public Placement [Member] | ||
Class of Stock [Line Items] | ||
Shares Issued | 62,485,461 | |
Gross Proceeds | $ 622,077 | |
Public Placement [Member] | Common Stock [Member] | Advisor [Member] | ||
Class of Stock [Line Items] | ||
Shares issued | 276,056 | |
Stock Dividends [Member] | ||
Class of Stock [Line Items] | ||
Shares Issued | 2,132,266 | |
Gross Proceeds | $ 0 | |
Distribution Reinvestment Plan [Member] | ||
Class of Stock [Line Items] | ||
Shares Issued | 5,750,205 | |
Gross Proceeds, distribution reinvestment plan | $ 55,623 | |
Advisor [Member] | ||
Class of Stock [Line Items] | ||
Shares Issued | 15,500 | |
Gross Proceeds | $ 155 | |
Shares converted | 4,500 |
EQUITY - Convertible Stock (Det
EQUITY - Convertible Stock (Details) | 9 Months Ended | |
Sep. 30, 2015Event$ / sharesshares | Dec. 31, 2014$ / sharesshares | |
Equity [Abstract] | ||
Convertible stock shares outstanding (in shares) | 50,000 | 50,000 |
Convertible stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 |
Convertible stock held by advisor and affiliated persons (in shares) | 49,063 | |
Convertible stock held by outside investors (in shares) | 937 | |
Percentage on original share price | 100.00% | |
Percentage non-compounded annual return, option one | 10.00% | |
Aggregate percentage return | 10.00% | |
Number of triggering events | Event | 2 | |
Conversion ratio | 0.00002 | |
Common stock, convertible, triggering event, if lesser of, option one | 25.00% | |
Common stock, convertible, triggering event, if lesser of, option two | 15.00% | |
Percentage non-compounded annual return, option two | 6.00% |
EQUITY - Redemption of Securiti
EQUITY - Redemption of Securities (Details) | 3 Months Ended | 9 Months Ended |
Sep. 30, 2015shares | Sep. 30, 2015shares | |
Equity [Abstract] | ||
Shares redeemed (in shares) | 197,718 | 397,800 |
Percentage of weighted-average number of outstanding shares during the 12-month period immediately prior to the effective date of the redemption that company will not redeem in excess of (in excess of 5%) | 5.00% | 5.00% |
Period of time shares are outstanding prior to the effective date of redemption | 12 months | |
Cash available for redemption, percentage of previous fiscal year operating cash flow | 1.00% | |
Number of days' notice required to suspend, terminate or amend share redemption program | 30 days |
EQUITY - Distributions (Details
EQUITY - Distributions (Details) $ / shares in Units, $ in Thousands | Sep. 30, 2015USD ($)$ / shares | Aug. 31, 2015USD ($)$ / shares | Jul. 31, 2015USD ($)$ / shares | Jun. 30, 2015USD ($)$ / shares | May. 29, 2015USD ($)$ / shares | Apr. 30, 2015USD ($)$ / shares | Mar. 31, 2015USD ($)$ / shares | Feb. 27, 2015USD ($)$ / shares | Jan. 30, 2015USD ($)$ / shares | Sep. 30, 2015USD ($)Distributionshares |
Securities Financing Transaction [Line Items] | ||||||||||
Total Aggregate Distribution | $ 31,531 | |||||||||
Aggregate Cash Distribution | 9,842 | |||||||||
Distributions Invested in Shares of Common Stock | $ 21,689 | |||||||||
Number of stock distributions | Distribution | 12 | |||||||||
Increase in accumulated deficit from stock distributions | $ 21,300 | |||||||||
Record Date of January 29, 2015 [Member] | ||||||||||
Securities Financing Transaction [Line Items] | ||||||||||
Total Aggregate Distribution | $ 3,461 | |||||||||
Aggregate Cash Distribution | 1,070 | |||||||||
Distributions Invested in Shares of Common Stock | $ 2,391 | |||||||||
Per Common Share | $ / shares | $ 0.05 | |||||||||
Record Date of February 26, 2015 [Member] | ||||||||||
Securities Financing Transaction [Line Items] | ||||||||||
Total Aggregate Distribution | $ 3,473 | |||||||||
Aggregate Cash Distribution | 1,081 | |||||||||
Distributions Invested in Shares of Common Stock | $ 2,392 | |||||||||
Per Common Share | $ / shares | $ 0.05 | |||||||||
Record Date of March 30, 2015 [Member] | ||||||||||
Securities Financing Transaction [Line Items] | ||||||||||
Total Aggregate Distribution | $ 3,480 | |||||||||
Aggregate Cash Distribution | 1,080 | |||||||||
Distributions Invested in Shares of Common Stock | $ 2,400 | |||||||||
Per Common Share | $ / shares | $ 0.05 | |||||||||
Record Date April 29, 2015 [Member] | ||||||||||
Securities Financing Transaction [Line Items] | ||||||||||
Total Aggregate Distribution | $ 3,492 | |||||||||
Aggregate Cash Distribution | 1,084 | |||||||||
Distributions Invested in Shares of Common Stock | $ 2,408 | |||||||||
Per Common Share | $ / shares | $ 0.05 | |||||||||
Record Date of May 28, 2015 [Member] | ||||||||||
Securities Financing Transaction [Line Items] | ||||||||||
Total Aggregate Distribution | $ 3,506 | |||||||||
Aggregate Cash Distribution | 1,088 | |||||||||
Distributions Invested in Shares of Common Stock | $ 2,418 | |||||||||
Per Common Share | $ / shares | $ 0.05 | |||||||||
Record Date of June 29, 2015 [Member] | ||||||||||
Securities Financing Transaction [Line Items] | ||||||||||
Total Aggregate Distribution | $ 3,516 | |||||||||
Aggregate Cash Distribution | 1,093 | |||||||||
Distributions Invested in Shares of Common Stock | $ 2,423 | |||||||||
Per Common Share | $ / shares | $ 0.05 | |||||||||
Record Date of July 30, 2015 [Member] | ||||||||||
Securities Financing Transaction [Line Items] | ||||||||||
Total Aggregate Distribution | $ 3,527 | |||||||||
Aggregate Cash Distribution | 1,103 | |||||||||
Distributions Invested in Shares of Common Stock | $ 2,424 | |||||||||
Per Common Share | $ / shares | $ 0.05 | |||||||||
Record Date of August 28, 2015 [Member] | ||||||||||
Securities Financing Transaction [Line Items] | ||||||||||
Total Aggregate Distribution | $ 3,535 | |||||||||
Aggregate Cash Distribution | 1,119 | |||||||||
Distributions Invested in Shares of Common Stock | $ 2,416 | |||||||||
Per Common Share | $ / shares | $ 0.05 | |||||||||
Record Date of September 29, 2015 [Member] | ||||||||||
Securities Financing Transaction [Line Items] | ||||||||||
Total Aggregate Distribution | $ 3,541 | |||||||||
Aggregate Cash Distribution | 1,124 | |||||||||
Distributions Invested in Shares of Common Stock | $ 2,417 | |||||||||
Per Common Share | $ / shares | $ 0.05 | |||||||||
Dividend Distribution One [Member] | ||||||||||
Securities Financing Transaction [Line Items] | ||||||||||
Number of stock distributions | Distribution | 7 | |||||||||
Common stock distributions (in shares) | shares | 0.015 | |||||||||
Dividend Distribution Two [Member] | ||||||||||
Securities Financing Transaction [Line Items] | ||||||||||
Number of stock distributions | Distribution | 2 | |||||||||
Common stock distributions (in shares) | shares | 0.0075 | |||||||||
Dividend Distribution Three [Member] | ||||||||||
Securities Financing Transaction [Line Items] | ||||||||||
Number of stock distributions | Distribution | 1 | |||||||||
Common stock distributions (in shares) | shares | 0.00585 | |||||||||
Dividend Distribution Four [Member] | ||||||||||
Securities Financing Transaction [Line Items] | ||||||||||
Number of stock distributions | Distribution | 2 | |||||||||
Common stock distributions (in shares) | shares | 0.005 |
FAIR VALUE MEASURES AND DISCL75
FAIR VALUE MEASURES AND DISCLOSURES - Assets Measured at Fair Value on a Recurring Basis (Details) - Fair Value, Measurements, Recurring [Member] - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Interest rate caps | $ 31 | $ 114 |
Assets, fair value | 31 | 114 |
Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Interest rate caps | 0 | 0 |
Assets, fair value | 0 | 0 |
Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Interest rate caps | 31 | 114 |
Assets, fair value | 31 | 114 |
Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Interest rate caps | 0 | 0 |
Assets, fair value | $ 0 | $ 0 |
FAIR VALUE MEASURES AND DISCL76
FAIR VALUE MEASURES AND DISCLOSURES - Schedule of Carrying and Fair Values (Details) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015USD ($)Loan | Dec. 31, 2014USD ($) | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Number of credit facilities | Loan | 3 | |
Carrying Amount [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Loans held for investment and preferred equity investments, net | $ 4,230 | $ 4,985 |
Mortgage notes payable, net | (575,558) | (444,168) |
Credit facilities | (58,394) | (45,586) |
Fair Value [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Loans held for investment and preferred equity investments, net | 4,669 | 4,985 |
Mortgage notes payable, net | (580,713) | (450,269) |
Credit facilities | $ (58,394) | $ (45,586) |
DERIVATIVES AND HEDGING ACTIV77
DERIVATIVES AND HEDGING ACTIVITIES (Details) $ in Thousands | Sep. 30, 2015USD ($)derivative | Dec. 31, 2014USD ($)derivative | Dec. 31, 2013derivative |
Interest Rate Cap [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Asset Derivatives, Fair Value | $ | $ 31 | $ 114 | |
Cash flow hedges [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Number of Instruments | 6 | 6 | 6 |
Cash flow hedges [Member] | Interest Rate Cap [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Number of Instruments | 6 | ||
Notional Amount | $ | $ 102,013 |
OPERATING EXPENSE LIMITATION WA
OPERATING EXPENSE LIMITATION WAIVER (Details) | Sep. 30, 2015Quarter |
OPERATING EXPENSE LIMITATION WAIVER [Abstract] | |
Percent of average invested assets | 2.00% |
Net income of operating expense, percent | 25.00% |
Number of most recently completed fiscal quarters for which Company must limit its operating expenses | 4 |
SUBSEQUENT EVENTS - Narrative (
SUBSEQUENT EVENTS - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | |||
Oct. 31, 2015 | Nov. 04, 2015 | Sep. 30, 2015 | Sep. 30, 2014 | |
Subsequent Event [Line Items] | ||||
Sales price | $ 87,684 | $ 29,056 | ||
Subsequent Event [Member] | ||||
Subsequent Event [Line Items] | ||||
Dividends declared (in dollars per share) | $ 0.05 | |||
Subsequent Event [Member] | Conifer Place [Member] | Corporate Joint Venture [Member] | ||||
Subsequent Event [Line Items] | ||||
Sales price | $ 42,500 |