Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2016 | Aug. 05, 2016 | |
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 | Non-accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 71,713,289 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Investments: | ||
Rental properties, net | $ 849,696 | $ 916,498 |
Other investments | 764 | 4,643 |
Identified intangible assets, net | 154 | 374 |
Assets held for sale - rental properties, net | 26,602 | 69,350 |
Total investments | 877,216 | 990,865 |
Cash | 82,192 | 78,442 |
Restricted cash | 6,422 | 9,987 |
Due from related parties | 2,004 | 1,421 |
Tenant receivables, net | 141 | 211 |
Deposits | 191 | 230 |
Prepaid expenses and other assets | 4,824 | 2,227 |
Goodwill | 711 | 1,231 |
Other assets associated with rental properties held for sale | 0 | 81 |
Total assets | 973,701 | 1,084,695 |
Liabilities: | ||
Mortgage notes payable, net | 538,273 | 591,545 |
Credit facility | 5,394 | 21,894 |
Accounts payable | 5,351 | 1,583 |
Accrued expenses and other liabilities | 5,944 | 7,932 |
Accrued real estate taxes | 5,321 | 6,856 |
Due to related parties | 1,477 | 1,185 |
Tenant prepayments | 922 | 1,212 |
Security deposits | 2,553 | 2,626 |
Other liabilities associated with rental properties held for sale | 0 | 16,763 |
Total liabilities | 565,235 | 651,596 |
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; 73,674,067 and 72,333,652 shares issued, respectively; and 71,495,449 and 71,617,117 shares outstanding, respectively) | 715 | 716 |
Convertible stock (“promote shares”; par value $.01; 50,000 shares authorized, issued and outstanding) | 1 | 1 |
Additional paid-in capital | 636,992 | 638,335 |
Accumulated other comprehensive loss | (391) | (440) |
Accumulated deficit | (230,277) | (213,366) |
Total stockholders’ equity | 407,040 | 425,246 |
Noncontrolling interests | 1,426 | 7,853 |
Total equity | 408,466 | 433,099 |
Total liabilities and equity | $ 973,701 | $ 1,084,695 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Jun. 30, 2016 | Dec. 31, 2015 |
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) | 73,674,067 | 72,333,652 |
Common stock, outstanding (in shares) | 71,495,449 | 71,617,117 |
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) INCOME - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Revenues: | ||||
Rental income | $ 30,357 | $ 28,250 | $ 60,748 | $ 55,821 |
Interest and dividend income | 364 | 162 | 529 | 325 |
Total revenues | 30,721 | 28,412 | 61,277 | 56,146 |
Expenses: | ||||
Rental operating - expenses | 7,251 | 7,857 | 14,860 | 15,792 |
Rental operating - payroll | 3,731 | 3,974 | 7,588 | 8,181 |
Rental operating - real estate taxes | 3,401 | 3,438 | 7,027 | 6,456 |
Subtotal - Rental operating expenses | 14,383 | 15,269 | 29,475 | 30,429 |
Acquisition costs | 0 | 4,108 | 0 | 5,809 |
Management fees | 4,032 | 3,719 | 8,087 | 7,180 |
General and administrative | 2,980 | 3,359 | 6,495 | 6,881 |
Loss on disposal of assets | 144 | 1,372 | 286 | 2,481 |
Provision for loan loss | 0 | 130 | 0 | 130 |
Depreciation and amortization expense | 10,945 | 12,059 | 22,339 | 22,356 |
Total expenses | 32,484 | 40,016 | 66,682 | 75,266 |
Loss before other income (expense) | (1,763) | (11,604) | (5,405) | (19,120) |
Other income (expense): | ||||
Net gains on dispositions of properties and joint venture interests | 9,701 | 4,376 | 27,456 | 33,551 |
Interest expense | (5,582) | (5,408) | (11,355) | (10,275) |
Insurance proceeds in excess of cost basis | 71 | 160 | 211 | 407 |
Total other income (expense) | 4,190 | (872) | 16,312 | 23,683 |
Net income (loss) | 2,427 | (12,476) | 10,907 | 4,563 |
Net (income) loss attributable to noncontrolling interests | (25) | 192 | (6,306) | 181 |
Net income (loss) attributable to stockholders | 2,402 | (12,284) | 4,601 | 4,744 |
Net income | 2,427 | (12,476) | 10,907 | 4,563 |
Other comprehensive (loss) income: | ||||
Reclassification adjustment for realized loss on derivative due to sale | 0 | 0 | 72 | 0 |
Designated derivatives, fair value adjustments | (7) | (41) | (23) | (125) |
Total other comprehensive (loss) income | (7) | (41) | 49 | (125) |
Comprehensive income (loss) | 2,420 | (12,517) | 10,956 | 4,438 |
Comprehensive (income) loss attributable to noncontrolling interests | (25) | 192 | (6,306) | 181 |
Total comprehensive income (loss) attributable to stockholders | $ 2,395 | $ (12,325) | $ 4,650 | $ 4,619 |
Weighted average common shares outstanding (in shares) | 72,005 | 70,107 | 71,862 | 69,798 |
Basic and diluted loss per common share: | ||||
Net income (loss) per common share (in dollars per share) | $ 0.03 | $ (0.18) | $ 0.06 | $ 0.07 |
CONSOLIDATED STATEMENT OF CHANG
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY - 6 months ended Jun. 30, 2016 - USD ($) $ in Thousands | Total | Total Stockholders’ Equity | Common Stock | Convertible Stock | Additional Paid-in Capital | Accumulated Other Comprehensive (Loss) Income | Accumulated Deficit | Noncontrolling interests |
Beginning balance at Dec. 31, 2015 | $ 433,099 | $ 425,246 | $ 716 | $ 1 | $ 638,335 | $ (440) | $ (213,366) | $ 7,853 |
Beginning balance (in shares) at Dec. 31, 2015 | 71,617,117 | 71,617,000 | 50,000 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Common stock issued through distribution reinvestment plan | $ 14,407 | 14,407 | $ 13 | 14,394 | ||||
Common stock issued through distribution reinvestment plan (in shares) | 1,300,000 | 1,340,000 | ||||||
Distributions on common stock | $ (21,512) | (21,512) | (21,512) | |||||
Common stock redemptions | $ (15,751) | (15,751) | $ (14) | (15,737) | ||||
Common stock redemptions (in shares) | (1,462,083) | (1,462,000) | ||||||
Other comprehensive income | $ 49 | 49 | 49 | |||||
Deconsolidation of subsidiaries | (3,613) | (3,613) | ||||||
Distribution to noncontrolling interests | (9,120) | (9,120) | ||||||
Net income | 10,907 | 4,601 | 4,601 | 6,306 | ||||
Ending balance at Jun. 30, 2016 | $ 408,466 | $ 407,040 | $ 715 | $ 1 | $ 636,992 | $ (391) | $ (230,277) | $ 1,426 |
Ending balance (in shares) at Jun. 30, 2016 | 71,495,449 | 71,495,000 | 50,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Cash flows from operating activities: | ||
Net income | $ 10,907 | $ 4,563 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Loss on disposal of assets | 286 | 2,481 |
Casualty losses | 80 | 0 |
Provision for loan loss | 0 | 130 |
Net gains on dispositions of properties and joint venture interests | (27,456) | (33,551) |
Depreciation and amortization | 22,339 | 22,356 |
Amortization of deferred financing costs | 1,232 | 906 |
Amortization of fair value adjustment of debt | (242) | (374) |
Realized loss on change in fair value of interest rate cap | 72 | 0 |
Accretion of discount and direct loan fees and costs | (22) | (17) |
Changes in operating assets and liabilities, net of acquisitions: | ||
Restricted cash | 1,711 | 906 |
Tenant receivables, net | 3 | 168 |
Deposits | 6 | (38) |
Prepaid expenses and other assets | (788) | (17) |
Due to/from related parties, net | (611) | (1,101) |
Accounts payable and accrued expenses | 44 | (1,286) |
Tenant prepayments | (237) | (172) |
Security deposits | 157 | 55 |
Net cash provided by (used in) operating activities | 7,481 | (4,991) |
Cash flows from investing activities: | ||
Proceeds from disposal of properties and joint venture interests, net of closing costs | 56,444 | 55,051 |
Property acquisitions | 0 | (96,953) |
Insurance proceeds received for casualty losses | 178 | 0 |
Acquisition of preferred equity interest | (408) | 0 |
Sale of preferred equity interest | 4,300 | 0 |
Capital expenditures | (13,291) | (17,465) |
Restricted cash | 1,191 | (690) |
Principal payments received on loans held for investment | 9 | 591 |
Net cash provided by (used in) investing activities | 48,423 | (59,466) |
Cash flows from financing activities: | ||
Redemptions of common stock | (15,751) | (1,849) |
Payment of deferred financing costs | (170) | (402) |
Increase in borrowings on mortgages | 12,296 | 26,280 |
Principal payments on borrowings on mortgages | (15,804) | (2,926) |
Proceeds from borrowings on credit facility | 12,500 | 30,918 |
Payments on credit facility | (29,000) | (20,288) |
Distributions paid on common stock | (7,105) | (6,496) |
Contributions of noncontrolling interests | 0 | 151 |
Purchase of interest rate caps | 0 | (91) |
Distributions to noncontrolling interests | (9,120) | 0 |
Net cash (used in) provided by financing activities | (52,154) | 25,297 |
Net increase (decrease) in cash | 3,750 | (39,160) |
Cash at beginning of period | 78,442 | 140,129 |
Cash at end of period | $ 82,192 | $ 100,969 |
NATURE OF BUSINESS AND OPERATIO
NATURE OF BUSINESS AND OPERATIONS | 6 Months Ended |
Jun. 30, 2016 | |
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, has been engaged to manage the day-to-day operations of the Company. Through its private offering and primary public offering, which concluded on December 13, 2013, the Company raised aggregate gross offering proceeds of $645.8 million , which resulted in the issuance of 64.9 million shares of common stock, including 276,056 shares purchased by the Advisor and 1.2 million shares sold in the Company's distribution reinvestment plan. During the years ended December 31, 2015 and 2014 , the Company issued 5.3 million additional shares for $51.9 million pursuant to its distribution reinvestment plan. During the six months ended June 30, 2016 , the Company additionally issued 1.3 million shares for $14.4 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. 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 possibly 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 consolidated balance sheet as of December 31, 2015 was derived from the audited consolidated financial statements as of and for the year ended December 31, 2015 . 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, 2015 . The results of operations for the six months ended June 30, 2016 may not necessarily be indicative of the results of operations for the full year ending December 31, 2016 . |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2016 | |
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 Iroquois, LP (“Vista”) Vista Apartment Homes 133 Philadelphia, PA RRE Iroquois Holdings, LLC N/A 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 (a) N/A Cincinnati, OH RRE Park Forest Holdings, LLC ("Park Forest") Mosaic 216 Oklahoma City, OK RRE Deerfield Holdings, LLC ("Deerfield") Deerfield 166 Hermantown, MN 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 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 Holdings, LLC ("Addison Place") The Estates at Johns Creek 403 Alpharetta, GA PRIP Coursey, LLC ("Evergreen at Coursey Place") Evergreen at Coursey Place (b) 352 Baton Rouge, LA PRIP 500, LLC ("Pinehurst") Pinehurst (b) 146 Kansas City, MO PRIP 1102, LLC ("Pheasant Run") Pheasant Run (b) 160 Lee's Summit, MO PRIP 11128, LLC ("Retreat at Shawnee") Retreat at Shawnee (b) 342 Shawnee, KS PRIP Stone Ridge, LLC ("Stone Ridge") N/A (b) N/A N/A PRIP Pines, LLC ("Pines of York") Pines of York (b) 248 Yorktown, VA 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 Holdings, 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 Woodmoor Holdings, LLC ("Woodmoor") South Lamar Village 208 Austin, TX RRE Gilbert Holdings, LLC ("Springs at Gilbert") Heritage Pointe 458 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 8,935 Subsidiaries related to disposed investments: RRE Crestwood Holdings, LLC (“Crestwood”) (c) N/A N/A RRE 107th Avenue Holdings, LLC (“107th Avenue”) (c) N/A N/A RRE Westhollow Holdings, LLC (“Westhollow”) (c) N/A N/A RRE Campus Club Holdings, LLC (“Campus Club”) (c) N/A N/A RRE Bristol Holdings, LLC (“Bristol”) (c) N/A N/A RRE Skyview Holdings, LLC ("Skyview") (c) N/A N/A RRE Foxwood Holdings, LLC ("Foxwood") (c) N/A N/A RRE Flagstone Holdings, LLC ("Flagstone") (c) N/A N/A RRE Kenwick Canterbury Holdings, LLC ("Kenwick & Canterbury") (c) N/A N/A RRE Armand Place Holdings, LLC ("Armand") (d) N/A N/A PRIP 5060/6310, LLC ("Governor Park") (b)(c) N/A N/A PRIP 3700, LLC ("Champion Farms") (b)(d) N/A N/A PRIP 6700, LLC ("Hilltop Village") (b)(c) N/A N/A PRIP 3383, LLC ("Conifer Place") (b)(d) N/A N/A RRE Nob Hill Holdings, LLC ("Nob Hill") (d) N/A N/A RRE Spring Hill Holdings, LLC ("Spring Hill") (e) N/A N/A PRIP 10637, LLC ("Fieldstone") (b)(d) N/A N/A N/A - Not Applicable (a) - Subsidiary holds a portion of the Williamsburg parking lot (b) - Wholly-owned subsidiary of RRE Charlemagne Holdings, LLC (c) - Underlying investment sold prior to 2016 (d) - Underlying investment sold in 2016 (e) - Underlying investment resolved in 2016 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. For consolidated entities (including VIEs of which the Company is the primary beneficiary), 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 income (loss) includes the noncontrolling interests’ share of income (loss). 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, which are VIEs, as follows: Subsidiary Ownership % Apartment Complex Number Property Location Springhurst Housing Partners, LLC (1) 70.0% Champion Farms N/A Louisville, KY Glenwood Housing Partners I, LLC (2) 83.0% Fieldstone N/A Woodlawn, OH FPA/PRIP Conifer, LLC (3) 42.5% Conifer Place N/A Norcross, GA DT Stone Ridge, LLC 83.4% Stone Ridge 188 Columbia, SC (1) On January 29, 2016, the Company sold its joint venture interest in Champion Farms to its joint venture partner. As such, the Company deconsolidated the entity as of January 29, 2016. The Company has no continuing involvement with this joint venture. (See Note 6) (2) On June 30, 2016, the Company sold its joint venture interest in Fieldstone to its joint venture partner. As such, the Company deconsolidated the entity as of June 30, 2016. The Company has no continuing involvement with this joint venture. (See Note 6) (3) On January 27, 2016, the Company and its joint venture partner sold the Conifer Place Apartments, which resulted in the deconsolidation of the entity as of January 27, 2016. (See Note 6) The Company's preferred equity investment was a VIE for which the Company had determined it was not the primary beneficiary; therefore, the Company did not consolidate the entity. The Company was not considered the primary beneficiary of the preferred equity investee because it did not possess the unilateral power to direct the key activities of investee that were considered most significant. Additional information with respect to the preferred equity investment is disclosed in Note 5. 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 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, 2015 , the Company had three rental properties included in assets held for sale. At June 30, 2016 , the Company had one rental property included in assets held for sale. Rental Properties The Company records acquired rental properties at fair value on their respective acquisition date. The Company considers the period of future benefit of an asset to determine its appropriate useful life and depreciates the rental properties 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 Improvements and replacements in excess of $1,000 are capitalized when they extend the useful life of the asset. Resource Real Estate Opportunity Manager, LLC (the “Manager”), an affiliate of the Advisor, earns a construction management fee of 5% of actual aggregate costs to construct improvements, or to repair, rehab or reconstruct a property. These costs are capitalized along with the related asset. Costs of repairs and maintenance are expensed as incurred. 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 six months ended June 30, 2016 and 2015 . 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 The Company recorded its preferred equity investments at amortized cost. Investments carried at amortized cost were evaluated for impairment at each reporting date. When an investment was impaired and that impairment was considered other than temporary, the amount of the loss accrual was calculated by comparing the carrying amount of the investment to its estimated fair value. This investment was repaid in full on June 6, 2016 (See Note 5). Dividend income was recognized when earned 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 difference between 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 future minimum rental payments to be received from noncancelable operating leases for residential rental properties are $51.2 million and $346,000 for the 12 month periods ending June 30, 2017 and 2018 , respectively, and none thereafter. The future minimum rental payments to be received from noncancelable operating leases for commercial rental properties and antenna rentals are $362,000 , $253,000 , $169,000 , $120,000 , $11,000 , and $0 for the 12 month periods ending June 30, 2017 , 2018 , 2019 , 2020 , 2021 , and thereafter, respectively. Revenue is primarily derived from the rental of residential housing units, however, included within rental income are other income such as pet fees, parking fees, and late fees, as well as property operating expense reimbursements due from tenants for common area maintenance, real estate taxes and other recoverable costs. The Company records the ancillary charges in the period they are earned or received and records the reimbursements in the period in which the related expenses are incurred. Total other income included within rental income was $2.8 million and $2.5 million for the three months ended June 30, 2016 and 2015 , respectively. Total other income included within rental income was $5.6 million and $4.5 million for the six months ended June 30, 2016 and 2015 , 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 June 30, 2016 and December 31, 2015 , there were allowances for uncollectible receivables of $4,399 and $24,100 , 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 June 30, 2016 and December 31, 2015 , 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. The Company is not subject to IRS examination for tax return years 2011 and prior. Earnings Per Share Basic earnings per share are calculated on the basis of the weighted-average number of common shares outstanding during the year. 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 12 ) are included in the diluted earnings per share calculations because the necessary conditions for conversion have not been satisfied as of June 30, 2016 (were such date to represent the end of the contingency period). Reclassifications Certain amounts in the prior year financial statements have been reclassified to conform to the current-year presentation. The Company has reclassified $428,000 and $956,000 of payroll expenses from General and Administrative to Rental Operating for the three and six months ended June 30, 2015, respectively. The impact of the reclassifications made to prior year amounts are not material and did not affect net income. In accordance with the adoption of Financial Accounting Standards Board ("FASB") Accounting Standards Update (“ASU”) 2015-03, "Simplifying the Presentation of Debt Issuance Costs", the Company has reclassified $6.5 million of unamortized debt issuance costs at December 31, 2015 from assets to liabilities as a direct reduction of the related mortgage notes payable. In addition, deferred finance costs related to the Company's credit facility were reclassified to prepaid and other assets (See Note 9 ). Adoption of New Accounting Standards 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". 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 was effective for fiscal years, and interim periods within those years, beginning after December 15, 2015. On January 1, 2016, the Company adopted ASU No. 2015-01 and the adoption had no impact on the Company's consolidated financial statements. In February 2015, FASB issued ASU 2015-02, "Consolidation (Topic 810): Amendments to the Consolidation Analysis", 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. On January 1, 2016, the Company adopted ASU 2015-02 and the adoption did not have a significant impact on the Company's consolidated financial statements. In April 2015, FASB issued ASU 2015-03, "Simplifying the Presentation of Debt Issuance Costs", 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 applied the new guidance on a retrospective basis and adjusted the balance sheet of each individual period presented to reflect the period-specific effects of applying the new guidance. This guidance was effective and was adopted by the Company on January 1, 2016. The Company has reclassified $6.5 million of unamortized debt issuance costs at December 31, 2015 from assets to liabilities as a direct reduction of the related mortgage notes payable. In August 2015, FASB issued ASU 2015-15, "Interest - Imputation of Interest", which clarifies that debt issuance costs associated with line of credit arrangements may continue to be accounted for as assets and not as a direct deduction from the carrying amount of the debt liabilities. This guidance was effective and was adopted by the Company on January 1, 2016. Deferred finance costs related to the Company's credit facility were reclassified to prepaid and other assets (See Note 9 ). In September 2015, FASB issued ASU 2015-16, "Simplifying the Accounting for Measurement-Period Adjustments", 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 was effective and adopted by the Company on January 1, 2016 and the adoption had no impact on its consolidated financial statements. Accounting Standards Issued But Not Yet Effective In May 2014, FASB issued 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 will be 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 February 2016, FASB issued ASU No. 2016-02, "Leases (Topic 842)", which requires lessees to recognize at the commencement date for all leases, with the exception of short-term leases, (a) a lease liability, which is a lessee‘s obligation to make lease payments arising from a lease, measured on a discounted basis, and (b) a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. ASU No. 2016-02 will be effective for the Company beginning January 1, 2019. The Company is evaluating this guidance; however, it does not expect the adoption of ASU No. 2016-02 to have a significant impact on its consolidated financial statements. In June 2016, FASB issued ASU No. 2016-13, “Financial Instruments - Credit Losses”, which requires measurement and recognition of expected credit losses for financial assets held. ASU No. 2016-13 will be effective for the Company beginning January 1, 2019. |
SUPPLEMENTAL CASH FLOW INFORMAT
SUPPLEMENTAL CASH FLOW INFORMATION | 6 Months Ended |
Jun. 30, 2016 | |
Supplemental Cash Flow Elements [Abstract] | |
SUPPLEMENTAL CASH FLOW INFORMATION | NOTE 3 - SUPPLEMENTAL CASH FLOW INFORMATION The following table presents the Company's supplemental cash flow information (in thousands): Six Months Ended June 30, 2016 2015 Non-cash financing and investing activities: Stock issued from the distribution reinvestment plan $ 14,407 $ 14,432 Deferred financing costs and escrow deposits funded directly by mortgage note and revolving credit facility — 10,709 Non-cash activity related to sales: Deconsolidation of mortgage note payable 31,539 — Deconsolidation of rental properties, net 35,152 — Noncontrolling interest of deconsolidated subsidiary 3,613 — Mortgage notes payable settled through sale of property 35,422 — Sale of property used to settle mortgage notes payable 35,422 — Assets and liabilities assumed in acquisitions: Debt assumed — 40,185 Other liabilities assumed — 99 Rental properties, net — 40,284 Cash paid during the period for: Interest $ 10,538 $ 9,388 |
RENTAL PROPERTIES, NET
RENTAL PROPERTIES, NET | 6 Months Ended |
Jun. 30, 2016 | |
Real Estate Investments, Net [Abstract] | |
RENTAL PROPERTIES, NET | NOTE 4 - RENTAL PROPERTIES, NET The following table presents the Company’s investments in rental properties (in thousands): June 30, December 31, Land $ 169,019 $ 180,533 Building and improvements 734,028 775,239 Furniture, fixtures and equipment 29,064 28,928 Construction in progress 3,903 2,949 936,014 987,649 Less: accumulated depreciation (86,318 ) (71,151 ) $ 849,696 $ 916,498 Depreciation expense for the three and six months ended June 30, 2016 was $10.9 million and $22.1 million , respectively, and for the three and six months ended June 30, 2015 was $10.6 million and $19.4 million , respectively. During the three months ended June 30, 2016 , the Company entered into an agreement to sell one rental property, the Nesbit Palisades, with a net book value of $26.6 million . The Company confirmed the intent and ability to sell this property in its present condition and this property qualified for held for sale accounting treatment upon meeting all applicable criteria prior to June 30, 2016 , at which time depreciation ceased. As such, the assets associated with this property were separately classified and included as assets held for sale on the Company's consolidated balance sheet at June 30, 2016 . However, the sale of this property 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 sale of the Nesbit Palisades on July 8, 2016 (see Note 16 ). During the three months ended December 31, 2015 , the Company entered into agreements to sell two rental properties, Conifer Place and Ivy at Clear Creek, with a net book value of $43.9 million . The Company confirmed the intent and ability to sell both properties in their present condition and both properties qualified for held for sale accounting treatment upon meeting all applicable criteria prior to December 31, 2015 , at which time depreciation ceased. As such, the assets associated with these properties were separately classified and included as assets held for sale on the Company's consolidated balance sheet at December 31, 2015 . However, the 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 both Conifer Place and Ivy at Clear Creek during the three months ended March 31, 2016 (see Note 6 ). In December 2015, the Company agreed to sell its 70% interest in the joint venture that owns Champion Farms Apartments to its joint venture partner. The sale was completed in January 2016. As such, all assets and liabilities of the consolidated entity were reclassified to held for sale as of December 31, 2015 in the consolidated balance sheet. In January 2016, the Company deconsolidated the entity (see Note 6 ). Loss on disposal of assets. During the three and six months ended June 30, 2016 , the Company recorded losses of $144,000 and $286,000 , respectively. During the three and six months ended June 30, 2015 , the Company recorded losses of $1.4 million and $2.5 million , respectively, all due to the replacement of appliances at its rental properties in conjunction with unit upgrades. |
OTHER INVESTMENTS
OTHER INVESTMENTS | 6 Months Ended |
Jun. 30, 2016 | |
Investments, Debt and Equity Securities [Abstract] | |
OTHER INVESTMENTS | NOTE 5 - OTHER INVESTMENTS The following table presents the Company's components of other investments (in thousands): June 30, 2016 December 31, 2015 Loan held for investment, net $ 764 $ 757 Preferred equity investment, net — 3,886 $ 764 $ 4,643 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, Presidium AMC Spring Hill Venture, LLC, ("Presidium"), a Texas limited liability company, owns the common equity and acts as the managing member of the Investment Vehicle. In October 2015 and March 2016, the Company funded an additional $800,000 in total. The Company was paid a dividend equal to 12% of the total amount invested, 7% of which was paid monthly and of which the remaining amount accrued and was to be paid when the property cash flow allowed for the repayment. This investment was repaid in full on June 6, 2016. In conjunction with the payoff, the Company received an exit fee of $230,000 , which is included in interest income in the Company's consolidated statement of operations. Loan 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. The Oberlin, Peterson and Heatherwood Notes were resolved in prior years. The following table presents the aging of the Company’s loan held for investment, net (in thousands): June 30, 2016 December 31, 2015 Current $ 764 $ 757 Delinquent: 30−89 days — — 90−180 days — — Greater than 180 days — — $ 764 $ 757 The following table presents information about the credit quality of the Company’s loan held for investment, net (in thousands): June 30, 2016 December 31, 2015 Performing $ 764 $ 757 Nonperforming — — Total $ 764 $ 757 The following table presents details of the balance and terms of the Company's loan held for investment, at June 30, 2016 and December 31, 2015 (in thousands): Unpaid Principal Balance Unamortized Discount Deferred expenses, net Net book value Maturity Date Interest Rate Average monthly payment Loan- Trail Ridge June 30, 2016: $ 969 $ (212 ) $ 7 $ 764 10/28/2021 7.5% $ 8 December 31, 2015: $ 981 $ (231 ) $ 7 $ 757 |
DISPOSITION OF PROPERTIES AND D
DISPOSITION OF PROPERTIES AND DECONSOLIDATION OF INTERESTS | 6 Months Ended |
Jun. 30, 2016 | |
Discontinued Operations and Disposal Groups [Abstract] | |
DISPOSITION OF PROPERTIES AND DECONSOLIDATION OF INTERESTS | NOTE 6 - DISPOSITION OF PROPERTIES AND DECONSOLIDATION OF INTERESTS The following table presents details of the Company's disposition and deconsolidation activity during the three and six months ended June 30, 2016 and 2015 (in thousands): Gain on Sale Multifamily Community Location Sale Date Contract Sales Price Three months ended June 30, 2016 Six months ended June 30, 2016 2016 Dispositions: Conifer Place (1) Norcross, Georgia January 27, 2016 $ 42,500 $ — $ 9,897 Champion Farms (2) Louisville, Kentucky January 29, 2016 7,590 — 1,066 The Ivy at Clear Creek Houston, Texas February 17, 2016 19,400 — 6,792 Affinity at Winter Park Winter Park, Florida June 9, 2016 17,500 5,605 5,605 Fieldstone (3) Woodland, Ohio June 30, 2016 7,514 4,096 4,096 $ 9,701 $ 27,456 2015 Dispositions: Three months ended June 30, 2015 Six months ended June 30, 2015 The Alcove Apartments Houston, Texas January 26, 2015 $ 11,050 $ (1 ) $ 3,784 107th Avenue Apartments Omaha, Nebraska January 29, 2015 250 — 50 The Redford Apartments Houston, Texas February 27, 2015 32,959 (9 ) 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 4,386 $ 4,376 $ 33,551 (1) On January 27, 2016, the Company and its joint venture partner sold the Conifer Place Apartments, which resulted in the deconsolidation of the entity as of January 27, 2016. Gain on sale includes $6.2 million attributable to noncontrolling interests. (2) On January 29, 2016, the Company sold its joint venture interest in Champion Farms to its joint venture partner. As such, the Company deconsolidated the entity as of January 29, 2016. The Company has no continuing involvement with this joint venture. (3) On June 30, 2016, the Company sold its joint venture interest in Fieldstone to its joint venture partner. As such, the Company deconsolidated the entity as of June 30, 2016. The Company has no continuing involvement with this joint venture. The following table presents the Company's revenues and net income (loss) attributable to properties sold, which includes gain on sale, for the three and six months ended June 30, 2016 and 2015 (in thousands): Revenues Attributable to Properties Sold Net Income (Loss) Attributable to Properties Sold Multifamily Community Three months ended June 30, 2016 Six months ended June 30, 2016 Three months ended June 30, 2016 Six months ended June 30, 2016 2016 Dispositions: Conifer Place (1) $ — $ 365 $ — $ 9,942 Champion Farms — 220 — 1,125 The Ivy at Clear Creek — 386 (1 ) 6,627 Affinity at Winter Park 463 1,008 5,742 5,748 Fieldstone 789 1,548 4,243 4,325 $ 1,252 $ 3,527 $ 9,984 $ 27,767 2015 Dispositions: Three months ended June 30, 2015 Six months ended June 30, 2015 Three months ended June 30, 2015 Six months ended June 30, 2015 The Alcove Apartments $ 1 $ 199 $ 4 $ 3,810 107th Avenue Apartments — 3 — 50 The Redford Apartments (40 ) 1,274 (67 ) 15,670 Cityside Apartments 7 701 — 10,310 One Hundred Chevy Chase 443 832 4,329 4,108 $ 411 $ 3,009 $ 4,266 $ 33,948 (1) On January 27, 2016, the Company and its joint venture partner sold the Conifer Place Apartments, which resulted in the deconsolidation of the entity as of January 27, 2016. Net income attributable to properties sold presented in table includes $6.3 million attributable to noncontrolling interests. The following table presents a rollforward of the Company's activity in goodwill for the six months ended June 30, 2016 (in thousands): Balance, January 1, 2016 $ 1,231 Sale of Conifer, Champion, and Fieldstone (520 ) Balance, June 30, 2016 $ 711 |
IDENTIFIED INTANGIBLE ASSETS, N
IDENTIFIED INTANGIBLE ASSETS, NET | 6 Months Ended |
Jun. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
IDENTIFIED INTANGIBLE ASSETS, NET | NOTE 7 - IDENTIFIED INTANGIBLE ASSETS, NET Identified intangible assets, net, consist of apartment unit rental and antennae leases. As of June 30, 2016 , all identified intangible assets related to apartment unit rental leases have been fully amortized. The net carrying value of the acquired in-place leases totaled $154,000 and $374,000 as of June 30, 2016 and December 31, 2015 , respectively, net of accumulated amortization of $25.1 million and $28.4 million , respectively. The weighted-average remaining life of the acquired apartment unit rental leases was zero months and one month as of June 30, 2016 and December 31, 2015 , respectively. Expected amortization for the antennae leases at the Vista Apartment Homes is $16,000 annually through 2025. Amortization of the apartment unit rental and antennae leases for the three and six months ended June 30, 2016 was $4,000 and $220,000 , respectively. Amortization of the apartment unit rental and antennae leases for the three and six months ended June 30, 2015 was $1.5 million and $3.0 million , respectively. The following table presents the Company's expected amortization for the antennae leases for the next five 12-month periods ending June 30, and thereafter (in thousands): 2017 $ 16 2018 16 2019 16 2020 16 2021 16 Thereafter 74 $ 154 |
MORTGAGE NOTES PAYABLE, NET
MORTGAGE NOTES PAYABLE, NET | 6 Months Ended |
Jun. 30, 2016 | |
Debt Disclosure [Abstract] | |
MORTGAGE NOTES PAYABLE, NET | NOTE 8 - MORTGAGE NOTES PAYABLE, NET The following table presents a summary of the Company's mortgage notes payable, net (in thousands): June 30, 2016 December 31, 2015 Collateral Outstanding Borrowings Premium (Discount) Deferred finance costs, net Carrying Value Outstanding Borrowings Premium (Discount) Deferred finance costs, net Carrying Value Vista Apartment Homes $ 15,398 $ — $ (197 ) $ 15,201 $ 15,573 $ — $ (216 ) $ 15,357 Cannery Lofts 8,065 — (116 ) 7,949 8,148 — (131 ) 8,017 Deerfield 10,439 — (142 ) 10,297 10,517 — (159 ) 10,358 Ivy at Clear Creek — — — — 8,431 — (136 ) 8,295 Trailpoint at the Woodlands 18,852 — (240 ) 18,612 19,013 — (257 ) 18,756 Verona Apartment Homes 22,176 — (148 ) 22,028 22,402 — (179 ) 22,223 Skyview Apartment Homes 17,907 — (123 ) 17,784 18,089 — (148 ) 17,941 The Nesbit Palisades 20,298 — (290 ) 20,008 20,298 — (309 ) 19,989 Maxwell Townhomes 13,728 — (152 ) 13,576 13,850 — (167 ) 13,683 Fieldstone — — — — 15,332 — (37 ) 15,295 Pinehurst 4,040 — — 4,040 4,111 — — 4,111 Pheasant Run 6,250 71 (15 ) 6,306 6,250 100 (20 ) 6,330 Retreat of Shawnee 12,993 124 (33 ) 13,084 13,090 164 (44 ) 13,210 Conifer Place — — — — 27,074 — — 27,074 Evergreen at Coursey Place 27,330 112 (107 ) 27,335 27,548 123 (120 ) 27,551 Pines of York 15,134 (331 ) (63 ) 14,740 15,267 (363 ) (69 ) 14,835 The Estates at Johns Creek 50,000 — (465 ) 49,535 50,000 — (526 ) 49,474 Chisholm Place 11,587 — (153 ) 11,434 11,587 — (163 ) 11,424 Perimeter Circle 17,478 — (172 ) 17,306 17,657 — (202 ) 17,455 Perimeter 5550 13,795 — (143 ) 13,652 13,935 — (167 ) 13,768 Aston at Cinco Ranch 23,572 — (299 ) 23,273 23,772 — (328 ) 23,444 Sunset Ridge 1 19,913 295 (234 ) 19,974 20,121 329 (261 ) 20,189 Sunset Ridge 2 2,975 40 (30 ) 2,985 3,002 45 (34 ) 3,013 Calloway at Las Colinas 35,414 — (339 ) 35,075 35,740 — (372 ) 35,368 South Lamar Village 12,560 — (158 ) 12,402 12,682 — (184 ) 12,498 Heritage Pointe 26,280 — (348 ) 25,932 26,280 — (370 ) 25,910 Yorba Linda 67,500 — (761 ) 66,739 67,500 — (860 ) 66,640 Villages at Bonita Glen 27,089 2,121 (364 ) 28,846 27,265 2,276 (391 ) 29,150 Stone Ridge 5,288 — (142 ) 5,146 5,350 — (153 ) 5,197 The Westside Apartments 23,000 — (273 ) 22,727 23,000 — (351 ) 22,649 Tech Center Square 12,500 — (213 ) 12,287 12,500 — (159 ) 12,341 $ 541,561 $ 2,432 $ (5,720 ) $ 538,273 $ 595,384 $ 2,674 $ (6,513 ) $ 591,545 The following table presents additional information about the Company's mortgage notes payable, net (in thousands, except percentages): Collateral Maturity Annual Average Average Monthly Escrow Vista Apartment Homes 1/1/2022 2.76% (1)(5) $65 $16 Cannery Lofts 9/1/2020 3.77% (1)(5) 40 26 Deerfield 11/1/2020 4.66% (2)(5) 54 29 Trailpoint at the Woodlands 11/1/2023 2.88% (1)(4) 69 67 Verona Apartment Homes 1/1/2019 3.60% (2)(5) 106 41 Skyview Apartment Homes 1/1/2019 3.60% (2)(5) 85 21 The Nesbit Palisades 7/1/2024 2.42% (1)(3) 59 54 Maxwell Townhomes 1/1/2022 4.32% (2)(5) 71 63 Pinehurst 1/1/2017 2.97% (1)(6) 23 12 Pheasant Run 10/1/2017 5.95% (2)(3) 31 15 Retreat of Shawnee 2/1/2018 5.58% (2)(5) 78 28 Evergreen at Coursey Place 8/1/2021 5.07% (2)(5) 154 48 Pines of York 12/1/2021 4.46% (2)(5) 80 37 The Estates at Johns Creek 7/1/2020 3.38% (2)(3) 220 102 Chisholm Place 6/1/2024 2.86% (1)(3) 39 38 Perimeter Circle 7/1/2019 3.42% (2)(5) 81 53 Perimeter 5550 7/1/2019 3.42% (2)(5) 64 41 Aston at Cinco Ranch 10/1/2021 4.34% (2)(5) 120 63 Sunset Ridge 1 11/1/2020 4.58% (2)(5) 113 91 Sunset Ridge 2 11/1/2020 4.54% (2)(5) 16 — Calloway at Las Colinas 12/1/2021 3.87% (2)(5) 171 113 South Lamar Village 8/1/2019 3.64% (2)(5) 59 46 Heritage Pointe 4/1/2025 2.35% (1)(3) 89 44 Yorba Linda 6/1/2020 2.22% (1)(3) 158 — Villages at Bonita Glen 10/1/2023 5.33% (2)(5) 152 38 Stone Ridge 12/1/2022 2.33% (1)(5) 21 17 The Westside Apartments 12/27/2017 2.42% (1)(3) 61 — Tech Center Square 6/1/2023 3.05% (1)(5) 53 25 (1) Variable rate based on one-month LIBOR of 0.4651% (as of June 30, 2016 ) 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 January 1, 2016, 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 (Fieldstone, Pinehurst, Pheasant Run, Retreat of Shawnee, Conifer Place, Evergreen at Coursey Place, Pines of York), Sunset Ridge and Maxwell acquisitions were recorded at their fair values. The premium or discount is amortized over the remaining term of the loans and included in interest expense. For the three months ended June 30, 2016 and 2015 , interest expense was reduced by $122,000 and $184,000 , respectively, for the amortization of the premium or discount. For the six months ended June 30, 2016 and 2015 , interest expense was reduced by $242,000 and $374,000 , respectively, for the amortization of the premium or discount. 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 June 30, 2016 and December 31, 2015 , the Company had $6.4 million and $10.0 million of restricted cash related to escrow deposits held by mortgage lenders for real estate taxes, insurance and capital reserves. The following table presents the Company's annual principal payments on the mortgage notes payable, excluding the amortization of the premium or discount, for each of the next five 12-month periods ending June 30, and thereafter (in thousands): 2017 $ 11,469 2018 49,794 2019 46,963 2020 114,707 2021 89,006 Thereafter 229,622 $ 541,561 The following table presents the Company's annual amortization of the premium or discount for each of the next five 12-month periods ending June 30, and thereafter (in thousands): 2017 $ 482 2018 401 2019 336 2020 331 2021 276 Thereafter 606 $ 2,432 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, of which $6.9 million were completed at June 30, 2016 . 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 mortgage loan includes a net worth and liquidity covenant. The Company was in compliance with all covenants related to this loan at June 30, 2016 . 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. On December 20, 2013 , the Company, through a wholly-owned subsidiary, entered into a loan ("Tech Center Loan") with PNC Bank, National Association. The Company provided a repayment guarantee of all interest and scheduled monthly principal payments (excluding the final payment at maturity for the outstanding balance). In March 2016, the Company amended the loan, removing any additional borrowing capacity and requiring monthly principal repayments beginning April 1, 2016. The interest rate on the loan was also increased from one-month LIBOR plus 2.0% to one-month LIBOR plus 2.25% . On May 3, 2016, the existing loan was repaid in full and was refinanced with a different lender. On December 27, 2013 , the Company, through a wholly-owned subsidiary, entered into a loan ("Westside Loan") with U.S. Bank National Association for $29.7 million . The Company may draw the remaining $6.7 million when certain debt service coverage and loan to value criteria are met. Amounts repaid on the loan may not be reborrowed. The Company provided a $6.5 million repayment guarantee. The Westside Loan includes a net worth, liquidity, leverage and debt service coverage covenants. The Company was in compliance with all covenants related to this loan at June 30, 2016 . Deferred financing costs incurred to obtain financing are amortized over the term of the related debt. During the three months ended June 30, 2016 and June 30, 2015 , $513,000 and $361,000 , respectively, of amortization of deferred financing costs was included in interest expense. During the six months ended June 30, 2016 and June 30, 2015 , $1,012,000 and $719,000 , respectively, of amortization of deferred financing costs was included in interest expense. Accumulated amortization as of June 30, 2016 and December 31, 2015 was $2.7 million and $2.4 million , respectively. Estimated amortization of the existing deferred financing costs for the next five 12-month periods ending June 30, and thereafter, is as follows (in thousands): 2017 $ 1,402 2018 1,271 2019 1,089 2020 850 2021 469 Thereafter 639 $ 5,720 |
CREDIT FACILITY
CREDIT FACILITY | 6 Months Ended |
Jun. 30, 2016 | |
Line of Credit Facility [Abstract] | |
CREDIT FACILITY | NOTE 9 - CREDIT FACILITY The following table presents a summary of the Company's credit facility (in thousands, except percentages): Weighted Average Interest Rate Balance Outstanding at Current Availability at Balance Maturity Interest Rate Basis (1) Current Three months ended June 30, Six Months Ended Lender June 30, 2016 December 31, 2015 2016 2015 2016 2015 Bank of America $ 5,394 $ 15,500 21,894 5/23/2017 LIBOR plus 3% 3.47% 3.40% 3.19% 3.43% 3.21% (1) Variable rate based on one-month LIBOR of 0.4651% (as of June 30, 2016 ). 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 $42.0 million as of June 30, 2016 and are guaranteed by the Company. Weighted average borrowings for the three months ended June 30, 2016 and 2015 were $11.6 million and $9.2 million , respectively. Weighted average borrowings for the six months ended June 30, 2016 and 2015 were $13.3 million and $6.4 million , respectively. 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. In addition to the covenants above, after 36 months from the date of an initial advance on any property, the property must satisfy debt service coverage requirements. This covenant will go into effect during the three months ended December 31, 2016 . The Company was in compliance with all loan covenants at June 30, 2016 . The Company has $169,000 and $389,000 of deferred finance costs included in prepaid expenses and other assets on the consolidated balance sheets related to the Bank of America Credit Facility as of June 30, 2016 and December 31, 2015 , respectively, which is being amortized over the term of the debt. During the three months ended June 30, 2016 and 2015 , $150,000 and $131,000 , respectively, of amortization of deferred finance costs was included in interest expense related to this facility. During the six months ended June 30, 2016 and 2015 , $220,000 and $187,000 , respectively, of amortization of deferred finance costs was included in interest expense related to this facility. Estimated amortization of the existing deferred financing costs is $169,000 for the 12-month period ending June 30, 2017 and none thereafter. Principal payments required by the credit facility for the 12-month period ending June 30, 2017 are approximately $5.4 million and none thereafter. |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE LOSS | 6 Months Ended |
Jun. 30, 2016 | |
Equity [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE LOSS | NOTE 10 - ACCUMULATED OTHER COMPREHENSIVE LOSS The following table presents the changes in each component of the Company's accumulated other comprehensive loss for the six months ended June 30, 2016 (in thousands): Net unrealized loss January 1, 2016 $ (440 ) Reclassification adjustment for realized loss on designated derivative 72 Unrealized loss on designated derivatives (23 ) June 30, 2016 $ (391 ) |
CERTAIN RELATIONSHIPS AND RELAT
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS | 6 Months Ended |
Jun. 30, 2016 | |
Related Party Transactions [Abstract] | |
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS | NOTE 11 - 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 On May 22, 2016, RAI agreed to be acquired by C-III Capital Partners LLC ("C-III"), a leading commercial real estate services company engaged in a broad range of activities. The proposed merger is expected to close late in the third quarter of 2016 and is subject to approval by the stockholders of RAI, regulatory approvals and other customary closing conditions. Upon closing of the transaction, C-III will control our Advisor and will control all of the shares currently held by 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 pool for the property insurance covers losses up to $2.5 million and the pool for the general liability covers losses up to the first $50,000 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. In the three and six months ended June 30, 2016 , the Company paid $1.7 million into the insurance pools. Internal audit . 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 and overhead allocation. 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. 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 The Manager 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 the Company's 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. Information technology fees and operating 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. 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 following table presents the Company's amounts payable to/receivable from related parties (in thousands): June 30, December 31, Due from related parties: RAI and affiliates $ 2,004 $ 1,421 Due to related parties: Advisor: Operating expense reimbursements $ — $ 286 Resource Real Estate Opportunity Manager, LLC: Property management fees 882 440 Other reimbursements 581 459 Other 14 — $ 1,477 $ 1,185 The following table presents the Company's fees earned/expenses paid to related parties (in thousands): Three Months Ended Six Months Ended June 30, June 30, 2016 2015 2016 2015 Fees earned / expenses paid to related parties: Advisor: Acquisition fees (1) $ — $ 3,687 $ 8 $ 5,169 Asset management fees (2) $ 2,674 $ 2,461 $ 5,381 $ 4,709 Disposition fees (3) $ 220 $ 270 $ 413 $ 1,031 Debt financing fees (4) $ — $ 474 $ — $ 670 Overhead allocation (5) $ 1,130 $ 934 $ 2,405 $ 1,822 Internal audit (5) $ — $ 7 $ — $ 14 Resource Real Estate Opportunity Manager LLC: Property management fees (2) $ 1,315 $ 1,131 $ 2,605 $ 2,238 Construction management fees (6) $ 250 $ 483 $ 492 $ 839 Information technology fees (5) $ 107 $ 83 $ 216 $ 166 Operating expense reimbursements (7) $ 62 $ 76 $ 130 $ 143 Debt servicing fees (2) $ 10 $ 20 $ 14 $ 25 Other: Ledgewood (5) $ 20 $ 83 $ 30 $ 144 Graphic Images (5) $ 60 $ 19 $ 60 $ 22 (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 gains on dispositions of properties and joint venture interests on the consolidated statements of operations and comprehensive loss. (4) Included in Mortgage notes payable, 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. (7) Included in Rental operating expenses on the consolidated statements of operations and comprehensive loss. |
EQUITY
EQUITY | 6 Months Ended |
Jun. 30, 2016 | |
Equity [Abstract] | |
EQUITY | NOTE 12 - 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 June 30, 2016 and December 31, 2015 , no shares of preferred stock were issued and outstanding. Common Stock As of June 30, 2016 , 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 7,777,113 77,300 Shares issued in conjunction with the Advisor's initial investment, 15,500 155 Total 73,674,067 $ 712,114 Shares redeemed (2,178,618 ) Total shares outstanding as of June 30, 2016 71,495,449 (1) Includes 276,056 shares issued to the Advisor. Convertible Stock As of June 30, 2016 and December 31, 2015 , 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 six months ended June 30, 2016 , the Company redeemed 1,116,740 and 1,462,083 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 six months ended June 30, 2016 . 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 six months ended June 30, 2016 , the Company paid aggregate distributions of $21.5 million , including $7.1 million of distributions paid in cash and $14.4 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 28, 2016 $0.05 January 29, 2016 $ 2,423 $ 1,151 $ 3,574 February 26, 2016 0.05 February 29, 2016 2,418 1,167 3,585 March 30, 2016 0.05 March 31, 2016 2,415 1,172 3,587 April 28, 2016 0.05 April 29, 2016 2,414 1,181 3,595 May 27, 2016 0.05 June 3, 2016 2,380 1,226 3,606 June 29, 2016 0.05 June 30, 2016 2,357 1,208 3,565 $0.30 $ 14,407 $ 7,105 $ 21,512 |
FAIR VALUE MEASURES AND DISCLOS
FAIR VALUE MEASURES AND DISCLOSURES | 6 Months Ended |
Jun. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASURES AND DISCLOSURES | NOTE 13 - 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 (in thousands): Level 1 Level 2 Level 3 Total June 30, 2016 Assets: Interest rate caps $ — $ 5 $ — $ 5 $ — $ 5 $ — $ 5 December 31, 2015 Assets: Interest rate caps $ — $ 32 $ — $ 32 $ — $ 32 $ — $ 32 The carrying and fair values of the Company’s loans held for investment, net, preferred equity investments, mortgage note payable-outstanding borrowings, mortgage note payable -included in other liabilities associated with rental properties held for sale and credit facilities were as follows (in thousands): June 30, 2016 December 31, 2015 Carrying Amount Estimated Fair Value Carrying Amount Estimated Fair Value Loan held for investment, net $ 764 $ 1,151 $ 757 $ 1,151 Preferred equity investment $ — $ — $ 3,886 $ 3,908 Mortgage notes payable- outstanding borrowings $ (541,561 ) $ (535,783 ) $ (595,384 ) $ (573,693 ) Mortgage note payable- included in other liabilities associated with rental properties held for sale $ — $ — $ (16,443 ) $ (16,597 ) Credit facility $ (5,394 ) $ (5,394 ) $ (21,894 ) $ (21,894 ) The fair values of the loan held for investment, net and preferred equity investment were estimated using rates available to the Company for debt with similar terms and remaining maturities (Level 3). The carrying amount of the mortgage notes payable presented is the outstanding borrowings excluding premium or discount and deferred finance costs, net. 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 value of the credit facility equals the carrying amounts because the variable interest rate is considered a market rate (Level 3). |
DERIVATIVES AND HEDGING ACTIVIT
DERIVATIVES AND HEDGING ACTIVITIES | 6 Months Ended |
Jun. 30, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVES AND HEDGING ACTIVITIES | NOTE 14 - 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 eight interest rate caps that were designated as cash flow hedges during 2013, 2014, 2015 and 2016. 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 six months ended June 30, 2016 and the year ended December 31, 2015 , 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 six months ended June 30, 2016 , the Company had a loss of $72,388 due to hedge ineffectiveness related to the sale of the Ivy at Clear Creek. 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 June 30, 2016 , 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 8 $ 119,863 January 1, 2018 to May 3, 2019 Tabular Disclosure of Fair Values of Derivative Instruments on the Balance Sheet The following table 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 June 30, 2016 and December 31, 2015 (in thousands): Asset Derivatives Liability Derivatives June 30, 2016 December 31, 2015 June 30, 2016 December 31, 2015 Balance Sheet Fair Value Balance Sheet Fair Value Balance Sheet Fair Value Balance Sheet Fair Value Interest rate caps $ 5 Interest rate caps $ 32 — $ — — $ — |
OPERATING EXPENSE LIMITATION
OPERATING EXPENSE LIMITATION | 6 Months Ended |
Jun. 30, 2016 | |
OPERATING EXPENSE LIMITATION WAIVER [Abstract] | |
OPERATING EXPENSE LIMITATION | NOTE 15 - 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 June 30, 2016 were in compliance with the charter imposed limitation. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2016 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 16 - SUBSEQUENT EVENTS On July 8, 2016, the Company sold the Nesbit Palisades, located in Alpharetta, Georgia, for $45.5 million . In conjunction with the sale, the Company paid off the outstanding mortgage loan secured by the property. The Company expects to record a gain on the sale during the three months ended September 30, 2016. On July 21, 2016, 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: July 28, 2016, August 30, 2016 and September 29, 2016. Such distributions were or are to be paid on July 29, 2016, August 31, 2016 and September 30, 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 ACCOUN23
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2016 | |
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 Iroquois, LP (“Vista”) Vista Apartment Homes 133 Philadelphia, PA RRE Iroquois Holdings, LLC N/A 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 (a) N/A Cincinnati, OH RRE Park Forest Holdings, LLC ("Park Forest") Mosaic 216 Oklahoma City, OK RRE Deerfield Holdings, LLC ("Deerfield") Deerfield 166 Hermantown, MN 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 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 Holdings, LLC ("Addison Place") The Estates at Johns Creek 403 Alpharetta, GA PRIP Coursey, LLC ("Evergreen at Coursey Place") Evergreen at Coursey Place (b) 352 Baton Rouge, LA PRIP 500, LLC ("Pinehurst") Pinehurst (b) 146 Kansas City, MO PRIP 1102, LLC ("Pheasant Run") Pheasant Run (b) 160 Lee's Summit, MO PRIP 11128, LLC ("Retreat at Shawnee") Retreat at Shawnee (b) 342 Shawnee, KS PRIP Stone Ridge, LLC ("Stone Ridge") N/A (b) N/A N/A PRIP Pines, LLC ("Pines of York") Pines of York (b) 248 Yorktown, VA 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 Holdings, 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 Woodmoor Holdings, LLC ("Woodmoor") South Lamar Village 208 Austin, TX RRE Gilbert Holdings, LLC ("Springs at Gilbert") Heritage Pointe 458 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 8,935 Subsidiaries related to disposed investments: RRE Crestwood Holdings, LLC (“Crestwood”) (c) N/A N/A RRE 107th Avenue Holdings, LLC (“107th Avenue”) (c) N/A N/A RRE Westhollow Holdings, LLC (“Westhollow”) (c) N/A N/A RRE Campus Club Holdings, LLC (“Campus Club”) (c) N/A N/A RRE Bristol Holdings, LLC (“Bristol”) (c) N/A N/A RRE Skyview Holdings, LLC ("Skyview") (c) N/A N/A RRE Foxwood Holdings, LLC ("Foxwood") (c) N/A N/A RRE Flagstone Holdings, LLC ("Flagstone") (c) N/A N/A RRE Kenwick Canterbury Holdings, LLC ("Kenwick & Canterbury") (c) N/A N/A RRE Armand Place Holdings, LLC ("Armand") (d) N/A N/A PRIP 5060/6310, LLC ("Governor Park") (b)(c) N/A N/A PRIP 3700, LLC ("Champion Farms") (b)(d) N/A N/A PRIP 6700, LLC ("Hilltop Village") (b)(c) N/A N/A PRIP 3383, LLC ("Conifer Place") (b)(d) N/A N/A RRE Nob Hill Holdings, LLC ("Nob Hill") (d) N/A N/A RRE Spring Hill Holdings, LLC ("Spring Hill") (e) N/A N/A PRIP 10637, LLC ("Fieldstone") (b)(d) N/A N/A N/A - Not Applicable (a) - Subsidiary holds a portion of the Williamsburg parking lot (b) - Wholly-owned subsidiary of RRE Charlemagne Holdings, LLC (c) - Underlying investment sold prior to 2016 (d) - Underlying investment sold in 2016 (e) - Underlying investment resolved in 2016 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. For consolidated entities (including VIEs of which the Company is the primary beneficiary), 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 income (loss) includes the noncontrolling interests’ share of income (loss). 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, which are VIEs, as follows: Subsidiary Ownership % Apartment Complex Number Property Location Springhurst Housing Partners, LLC (1) 70.0% Champion Farms N/A Louisville, KY Glenwood Housing Partners I, LLC (2) 83.0% Fieldstone N/A Woodlawn, OH FPA/PRIP Conifer, LLC (3) 42.5% Conifer Place N/A Norcross, GA DT Stone Ridge, LLC 83.4% Stone Ridge 188 Columbia, SC (1) On January 29, 2016, the Company sold its joint venture interest in Champion Farms to its joint venture partner. As such, the Company deconsolidated the entity as of January 29, 2016. The Company has no continuing involvement with this joint venture. (See Note 6) (2) On June 30, 2016, the Company sold its joint venture interest in Fieldstone to its joint venture partner. As such, the Company deconsolidated the entity as of June 30, 2016. The Company has no continuing involvement with this joint venture. (See Note 6) (3) On January 27, 2016, the Company and its joint venture partner sold the Conifer Place Apartments, which resulted in the deconsolidation of the entity as of January 27, 2016. (See Note 6) The Company's preferred equity investment was a VIE for which the Company had determined it was not the primary beneficiary; therefore, the Company did not consolidate the entity. The Company was not considered the primary beneficiary of the preferred equity investee because it did not possess the unilateral power to direct the key activities of investee that were considered most significant. |
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 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 on their respective acquisition date. The Company considers the period of future benefit of an asset to determine its appropriate useful life and depreciates the rental properties 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 Improvements and replacements in excess of $1,000 are capitalized when they extend the useful life of the asset. Resource Real Estate Opportunity Manager, LLC (the “Manager”), an affiliate of the Advisor, earns a construction management fee of 5% of actual aggregate costs to construct improvements, or to repair, rehab or reconstruct a property. These costs are capitalized along with the related asset. Costs of repairs and maintenance are expensed as incurred. |
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 recorded its preferred equity investments at amortized cost. Investments carried at amortized cost were evaluated for impairment at each reporting date. When an investment was impaired and that impairment was considered other than temporary, the amount of the loss accrual was calculated by comparing the carrying amount of the investment to its estimated fair value. This investment was repaid in full on June 6, 2016 (See Note 5). Dividend income was recognized when earned 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 difference between 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 future minimum rental payments to be received from noncancelable operating leases for residential rental properties are $51.2 million and $346,000 for the 12 month periods ending June 30, 2017 and 2018 , respectively, and none thereafter. The future minimum rental payments to be received from noncancelable operating leases for commercial rental properties and antenna rentals are $362,000 , $253,000 , $169,000 , $120,000 , $11,000 , and $0 for the 12 month periods ending June 30, 2017 , 2018 , 2019 , 2020 , 2021 , and thereafter, respectively. Revenue is primarily derived from the rental of residential housing units, however, included within rental income are other income such as pet fees, parking fees, and late fees, as well as property operating expense reimbursements due from tenants for common area maintenance, real estate taxes and other recoverable costs. The Company records the ancillary charges in the period they are earned or received and records the reimbursements 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 June 30, 2016 and December 31, 2015 , 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. |
Earnings Per Share | Earnings Per Share Basic earnings per share are calculated on the basis of the weighted-average number of common shares outstanding during the year. 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 year financial statements have been reclassified to conform to the current-year presentation. The Company has reclassified $428,000 and $956,000 of payroll expenses from General and Administrative to Rental Operating for the three and six months ended June 30, 2015, respectively. The impact of the reclassifications made to prior year amounts are not material and did not affect net income. |
Adoption of New Accounting Standards | Adoption of New Accounting Standards 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". 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 was effective for fiscal years, and interim periods within those years, beginning after December 15, 2015. On January 1, 2016, the Company adopted ASU No. 2015-01 and the adoption had no impact on the Company's consolidated financial statements. In February 2015, FASB issued ASU 2015-02, "Consolidation (Topic 810): Amendments to the Consolidation Analysis", 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. On January 1, 2016, the Company adopted ASU 2015-02 and the adoption did not have a significant impact on the Company's consolidated financial statements. In April 2015, FASB issued ASU 2015-03, "Simplifying the Presentation of Debt Issuance Costs", 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 applied the new guidance on a retrospective basis and adjusted the balance sheet of each individual period presented to reflect the period-specific effects of applying the new guidance. This guidance was effective and was adopted by the Company on January 1, 2016. The Company has reclassified $6.5 million of unamortized debt issuance costs at December 31, 2015 from assets to liabilities as a direct reduction of the related mortgage notes payable. In August 2015, FASB issued ASU 2015-15, "Interest - Imputation of Interest", which clarifies that debt issuance costs associated with line of credit arrangements may continue to be accounted for as assets and not as a direct deduction from the carrying amount of the debt liabilities. This guidance was effective and was adopted by the Company on January 1, 2016. Deferred finance costs related to the Company's credit facility were reclassified to prepaid and other assets (See Note 9 ). In September 2015, FASB issued ASU 2015-16, "Simplifying the Accounting for Measurement-Period Adjustments", 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 was effective and adopted by the Company on January 1, 2016 and the adoption had no impact on its consolidated financial statements. Accounting Standards Issued But Not Yet Effective In May 2014, FASB issued 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 will be 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 February 2016, FASB issued ASU No. 2016-02, "Leases (Topic 842)", which requires lessees to recognize at the commencement date for all leases, with the exception of short-term leases, (a) a lease liability, which is a lessee‘s obligation to make lease payments arising from a lease, measured on a discounted basis, and (b) a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. ASU No. 2016-02 will be effective for the Company beginning January 1, 2019. The Company is evaluating this guidance; however, it does not expect the adoption of ASU No. 2016-02 to have a significant impact on its consolidated financial statements. In June 2016, FASB issued ASU No. 2016-13, “Financial Instruments - Credit Losses”, which requires measurement and recognition of expected credit losses for financial assets held. ASU No. 2016-13 will be effective for the Company beginning January 1, 2019. The Company is evaluating this guidance; however, it does not expect the adoption of ASU No. 2016-13 to have a significant impact on its consolidated financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN24
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
Wholly Owned Subsidiaries Information | The consolidated financial statements include the accounts of the Company's majority-owned and/or controlled subsidiaries, which are VIEs, as follows: Subsidiary Ownership % Apartment Complex Number Property Location Springhurst Housing Partners, LLC (1) 70.0% Champion Farms N/A Louisville, KY Glenwood Housing Partners I, LLC (2) 83.0% Fieldstone N/A Woodlawn, OH FPA/PRIP Conifer, LLC (3) 42.5% Conifer Place N/A Norcross, GA DT Stone Ridge, LLC 83.4% Stone Ridge 188 Columbia, SC (1) On January 29, 2016, the Company sold its joint venture interest in Champion Farms to its joint venture partner. As such, the Company deconsolidated the entity as of January 29, 2016. The Company has no continuing involvement with this joint venture. (See Note 6) (2) On June 30, 2016, the Company sold its joint venture interest in Fieldstone to its joint venture partner. As such, the Company deconsolidated the entity as of June 30, 2016. The Company has no continuing involvement with this joint venture. (See Note 6) (3) On January 27, 2016, the Company and its joint venture partner sold the Conifer Place Apartments, which resulted in the deconsolidation of the entity as of January 27, 2016. (See Note 6) 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 Iroquois, LP (“Vista”) Vista Apartment Homes 133 Philadelphia, PA RRE Iroquois Holdings, LLC N/A 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 (a) N/A Cincinnati, OH RRE Park Forest Holdings, LLC ("Park Forest") Mosaic 216 Oklahoma City, OK RRE Deerfield Holdings, LLC ("Deerfield") Deerfield 166 Hermantown, MN 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 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 Holdings, LLC ("Addison Place") The Estates at Johns Creek 403 Alpharetta, GA PRIP Coursey, LLC ("Evergreen at Coursey Place") Evergreen at Coursey Place (b) 352 Baton Rouge, LA PRIP 500, LLC ("Pinehurst") Pinehurst (b) 146 Kansas City, MO PRIP 1102, LLC ("Pheasant Run") Pheasant Run (b) 160 Lee's Summit, MO PRIP 11128, LLC ("Retreat at Shawnee") Retreat at Shawnee (b) 342 Shawnee, KS PRIP Stone Ridge, LLC ("Stone Ridge") N/A (b) N/A N/A PRIP Pines, LLC ("Pines of York") Pines of York (b) 248 Yorktown, VA 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 Holdings, 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 Woodmoor Holdings, LLC ("Woodmoor") South Lamar Village 208 Austin, TX RRE Gilbert Holdings, LLC ("Springs at Gilbert") Heritage Pointe 458 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 8,935 Subsidiaries related to disposed investments: RRE Crestwood Holdings, LLC (“Crestwood”) (c) N/A N/A RRE 107th Avenue Holdings, LLC (“107th Avenue”) (c) N/A N/A RRE Westhollow Holdings, LLC (“Westhollow”) (c) N/A N/A RRE Campus Club Holdings, LLC (“Campus Club”) (c) N/A N/A RRE Bristol Holdings, LLC (“Bristol”) (c) N/A N/A RRE Skyview Holdings, LLC ("Skyview") (c) N/A N/A RRE Foxwood Holdings, LLC ("Foxwood") (c) N/A N/A RRE Flagstone Holdings, LLC ("Flagstone") (c) N/A N/A RRE Kenwick Canterbury Holdings, LLC ("Kenwick & Canterbury") (c) N/A N/A RRE Armand Place Holdings, LLC ("Armand") (d) N/A N/A PRIP 5060/6310, LLC ("Governor Park") (b)(c) N/A N/A PRIP 3700, LLC ("Champion Farms") (b)(d) N/A N/A PRIP 6700, LLC ("Hilltop Village") (b)(c) N/A N/A PRIP 3383, LLC ("Conifer Place") (b)(d) N/A N/A RRE Nob Hill Holdings, LLC ("Nob Hill") (d) N/A N/A RRE Spring Hill Holdings, LLC ("Spring Hill") (e) N/A N/A PRIP 10637, LLC ("Fieldstone") (b)(d) N/A N/A N/A - Not Applicable (a) - Subsidiary holds a portion of the Williamsburg parking lot (b) - Wholly-owned subsidiary of RRE Charlemagne Holdings, LLC (c) - Underlying investment sold prior to 2016 (d) - Underlying investment sold in 2016 (e) - Underlying investment resolved in 2016 |
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 INFORM25
SUPPLEMENTAL CASH FLOW INFORMATION (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Supplemental Cash Flow Elements [Abstract] | |
Schedule of Supplemental Cash Flow Information | The following table presents the Company's supplemental cash flow information (in thousands): Six Months Ended June 30, 2016 2015 Non-cash financing and investing activities: Stock issued from the distribution reinvestment plan $ 14,407 $ 14,432 Deferred financing costs and escrow deposits funded directly by mortgage note and revolving credit facility — 10,709 Non-cash activity related to sales: Deconsolidation of mortgage note payable 31,539 — Deconsolidation of rental properties, net 35,152 — Noncontrolling interest of deconsolidated subsidiary 3,613 — Mortgage notes payable settled through sale of property 35,422 — Sale of property used to settle mortgage notes payable 35,422 — Assets and liabilities assumed in acquisitions: Debt assumed — 40,185 Other liabilities assumed — 99 Rental properties, net — 40,284 Cash paid during the period for: Interest $ 10,538 $ 9,388 |
RENTAL PROPERTIES, NET (Tables)
RENTAL PROPERTIES, NET (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Real Estate Investments, Net [Abstract] | |
Summary of Investments in Rental Properties | The following table presents the Company’s investments in rental properties (in thousands): June 30, December 31, Land $ 169,019 $ 180,533 Building and improvements 734,028 775,239 Furniture, fixtures and equipment 29,064 28,928 Construction in progress 3,903 2,949 936,014 987,649 Less: accumulated depreciation (86,318 ) (71,151 ) $ 849,696 $ 916,498 |
OTHER INVESTMENTS (Tables)
OTHER INVESTMENTS (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Investments, Debt and Equity Securities [Abstract] | |
Components of Investments | The following table presents the Company's components of other investments (in thousands): June 30, 2016 December 31, 2015 Loan held for investment, net $ 764 $ 757 Preferred equity investment, net — 3,886 $ 764 $ 4,643 |
Aging of Loan Held for Investment | The following table presents the aging of the Company’s loan held for investment, net (in thousands): June 30, 2016 December 31, 2015 Current $ 764 $ 757 Delinquent: 30−89 days — — 90−180 days — — Greater than 180 days — — $ 764 $ 757 |
Schedule of Credit Quality of Loan Held for Investment, Net | The following table presents information about the credit quality of the Company’s loan held for investment, net (in thousands): June 30, 2016 December 31, 2015 Performing $ 764 $ 757 Nonperforming — — Total $ 764 $ 757 |
Terms of Loan Held for Investment | The following table presents details of the balance and terms of the Company's loan held for investment, at June 30, 2016 and December 31, 2015 (in thousands): Unpaid Principal Balance Unamortized Discount Deferred expenses, net Net book value Maturity Date Interest Rate Average monthly payment Loan- Trail Ridge June 30, 2016: $ 969 $ (212 ) $ 7 $ 764 10/28/2021 7.5% $ 8 December 31, 2015: $ 981 $ (231 ) $ 7 $ 757 |
DISPOSITION OF PROPERTIES AND28
DISPOSITION OF PROPERTIES AND DECONSOLIDATION OF INTERESTS (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Summary of Disposition Activity | The following table presents details of the Company's disposition and deconsolidation activity during the three and six months ended June 30, 2016 and 2015 (in thousands): Gain on Sale Multifamily Community Location Sale Date Contract Sales Price Three months ended June 30, 2016 Six months ended June 30, 2016 2016 Dispositions: Conifer Place (1) Norcross, Georgia January 27, 2016 $ 42,500 $ — $ 9,897 Champion Farms (2) Louisville, Kentucky January 29, 2016 7,590 — 1,066 The Ivy at Clear Creek Houston, Texas February 17, 2016 19,400 — 6,792 Affinity at Winter Park Winter Park, Florida June 9, 2016 17,500 5,605 5,605 Fieldstone (3) Woodland, Ohio June 30, 2016 7,514 4,096 4,096 $ 9,701 $ 27,456 2015 Dispositions: Three months ended June 30, 2015 Six months ended June 30, 2015 The Alcove Apartments Houston, Texas January 26, 2015 $ 11,050 $ (1 ) $ 3,784 107th Avenue Apartments Omaha, Nebraska January 29, 2015 250 — 50 The Redford Apartments Houston, Texas February 27, 2015 32,959 (9 ) 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 4,386 $ 4,376 $ 33,551 (1) On January 27, 2016, the Company and its joint venture partner sold the Conifer Place Apartments, which resulted in the deconsolidation of the entity as of January 27, 2016. Gain on sale includes $6.2 million attributable to noncontrolling interests. (2) On January 29, 2016, the Company sold its joint venture interest in Champion Farms to its joint venture partner. As such, the Company deconsolidated the entity as of January 29, 2016. The Company has no continuing involvement with this joint venture. (3) On June 30, 2016, the Company sold its joint venture interest in Fieldstone to its joint venture partner. As such, the Company deconsolidated the entity as of June 30, 2016. The Company has no continuing involvement with this joint venture. The following table presents the Company's revenues and net income (loss) attributable to properties sold, which includes gain on sale, for the three and six months ended June 30, 2016 and 2015 (in thousands): Revenues Attributable to Properties Sold Net Income (Loss) Attributable to Properties Sold Multifamily Community Three months ended June 30, 2016 Six months ended June 30, 2016 Three months ended June 30, 2016 Six months ended June 30, 2016 2016 Dispositions: Conifer Place (1) $ — $ 365 $ — $ 9,942 Champion Farms — 220 — 1,125 The Ivy at Clear Creek — 386 (1 ) 6,627 Affinity at Winter Park 463 1,008 5,742 5,748 Fieldstone 789 1,548 4,243 4,325 $ 1,252 $ 3,527 $ 9,984 $ 27,767 2015 Dispositions: Three months ended June 30, 2015 Six months ended June 30, 2015 Three months ended June 30, 2015 Six months ended June 30, 2015 The Alcove Apartments $ 1 $ 199 $ 4 $ 3,810 107th Avenue Apartments — 3 — 50 The Redford Apartments (40 ) 1,274 (67 ) 15,670 Cityside Apartments 7 701 — 10,310 One Hundred Chevy Chase 443 832 4,329 4,108 $ 411 $ 3,009 $ 4,266 $ 33,948 (1) On January 27, 2016, the Company and its joint venture partner sold the Conifer Place Apartments, which resulted in the deconsolidation of the entity as of January 27, 2016. Net income attributable to properties sold presented in table includes $6.3 million attributable to noncontrolling interests. |
Roll Forward of Goodwill Activity | The following table presents a rollforward of the Company's activity in goodwill for the six months ended June 30, 2016 (in thousands): Balance, January 1, 2016 $ 1,231 Sale of Conifer, Champion, and Fieldstone (520 ) Balance, June 30, 2016 $ 711 |
IDENTIFIED INTANGIBLE ASSETS,29
IDENTIFIED INTANGIBLE ASSETS, NET (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Expected Amortization of Rental and Antennae Leases | xpected amortization for the antennae leases for the next five 12-month periods ending June 30, and thereafter (in thousands): 2017 $ 16 2018 16 2019 16 2020 16 2021 16 Thereafter 74 $ 154 |
MORTGAGE NOTES PAYABLE, NET (Ta
MORTGAGE NOTES PAYABLE, NET (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Debt Disclosure [Abstract] | |
Summary of Mortgage Notes Payable | The following table presents a summary of the Company's mortgage notes payable, net (in thousands): June 30, 2016 December 31, 2015 Collateral Outstanding Borrowings Premium (Discount) Deferred finance costs, net Carrying Value Outstanding Borrowings Premium (Discount) Deferred finance costs, net Carrying Value Vista Apartment Homes $ 15,398 $ — $ (197 ) $ 15,201 $ 15,573 $ — $ (216 ) $ 15,357 Cannery Lofts 8,065 — (116 ) 7,949 8,148 — (131 ) 8,017 Deerfield 10,439 — (142 ) 10,297 10,517 — (159 ) 10,358 Ivy at Clear Creek — — — — 8,431 — (136 ) 8,295 Trailpoint at the Woodlands 18,852 — (240 ) 18,612 19,013 — (257 ) 18,756 Verona Apartment Homes 22,176 — (148 ) 22,028 22,402 — (179 ) 22,223 Skyview Apartment Homes 17,907 — (123 ) 17,784 18,089 — (148 ) 17,941 The Nesbit Palisades 20,298 — (290 ) 20,008 20,298 — (309 ) 19,989 Maxwell Townhomes 13,728 — (152 ) 13,576 13,850 — (167 ) 13,683 Fieldstone — — — — 15,332 — (37 ) 15,295 Pinehurst 4,040 — — 4,040 4,111 — — 4,111 Pheasant Run 6,250 71 (15 ) 6,306 6,250 100 (20 ) 6,330 Retreat of Shawnee 12,993 124 (33 ) 13,084 13,090 164 (44 ) 13,210 Conifer Place — — — — 27,074 — — 27,074 Evergreen at Coursey Place 27,330 112 (107 ) 27,335 27,548 123 (120 ) 27,551 Pines of York 15,134 (331 ) (63 ) 14,740 15,267 (363 ) (69 ) 14,835 The Estates at Johns Creek 50,000 — (465 ) 49,535 50,000 — (526 ) 49,474 Chisholm Place 11,587 — (153 ) 11,434 11,587 — (163 ) 11,424 Perimeter Circle 17,478 — (172 ) 17,306 17,657 — (202 ) 17,455 Perimeter 5550 13,795 — (143 ) 13,652 13,935 — (167 ) 13,768 Aston at Cinco Ranch 23,572 — (299 ) 23,273 23,772 — (328 ) 23,444 Sunset Ridge 1 19,913 295 (234 ) 19,974 20,121 329 (261 ) 20,189 Sunset Ridge 2 2,975 40 (30 ) 2,985 3,002 45 (34 ) 3,013 Calloway at Las Colinas 35,414 — (339 ) 35,075 35,740 — (372 ) 35,368 South Lamar Village 12,560 — (158 ) 12,402 12,682 — (184 ) 12,498 Heritage Pointe 26,280 — (348 ) 25,932 26,280 — (370 ) 25,910 Yorba Linda 67,500 — (761 ) 66,739 67,500 — (860 ) 66,640 Villages at Bonita Glen 27,089 2,121 (364 ) 28,846 27,265 2,276 (391 ) 29,150 Stone Ridge 5,288 — (142 ) 5,146 5,350 — (153 ) 5,197 The Westside Apartments 23,000 — (273 ) 22,727 23,000 — (351 ) 22,649 Tech Center Square 12,500 — (213 ) 12,287 12,500 — (159 ) 12,341 $ 541,561 $ 2,432 $ (5,720 ) $ 538,273 $ 595,384 $ 2,674 $ (6,513 ) $ 591,545 The following table presents additional information about the Company's mortgage notes payable, net (in thousands, except percentages): Collateral Maturity Annual Average Average Monthly Escrow Vista Apartment Homes 1/1/2022 2.76% (1)(5) $65 $16 Cannery Lofts 9/1/2020 3.77% (1)(5) 40 26 Deerfield 11/1/2020 4.66% (2)(5) 54 29 Trailpoint at the Woodlands 11/1/2023 2.88% (1)(4) 69 67 Verona Apartment Homes 1/1/2019 3.60% (2)(5) 106 41 Skyview Apartment Homes 1/1/2019 3.60% (2)(5) 85 21 The Nesbit Palisades 7/1/2024 2.42% (1)(3) 59 54 Maxwell Townhomes 1/1/2022 4.32% (2)(5) 71 63 Pinehurst 1/1/2017 2.97% (1)(6) 23 12 Pheasant Run 10/1/2017 5.95% (2)(3) 31 15 Retreat of Shawnee 2/1/2018 5.58% (2)(5) 78 28 Evergreen at Coursey Place 8/1/2021 5.07% (2)(5) 154 48 Pines of York 12/1/2021 4.46% (2)(5) 80 37 The Estates at Johns Creek 7/1/2020 3.38% (2)(3) 220 102 Chisholm Place 6/1/2024 2.86% (1)(3) 39 38 Perimeter Circle 7/1/2019 3.42% (2)(5) 81 53 Perimeter 5550 7/1/2019 3.42% (2)(5) 64 41 Aston at Cinco Ranch 10/1/2021 4.34% (2)(5) 120 63 Sunset Ridge 1 11/1/2020 4.58% (2)(5) 113 91 Sunset Ridge 2 11/1/2020 4.54% (2)(5) 16 — Calloway at Las Colinas 12/1/2021 3.87% (2)(5) 171 113 South Lamar Village 8/1/2019 3.64% (2)(5) 59 46 Heritage Pointe 4/1/2025 2.35% (1)(3) 89 44 Yorba Linda 6/1/2020 2.22% (1)(3) 158 — Villages at Bonita Glen 10/1/2023 5.33% (2)(5) 152 38 Stone Ridge 12/1/2022 2.33% (1)(5) 21 17 The Westside Apartments 12/27/2017 2.42% (1)(3) 61 — Tech Center Square 6/1/2023 3.05% (1)(5) 53 25 (1) Variable rate based on one-month LIBOR of 0.4651% (as of June 30, 2016 ) 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 January 1, 2016, 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 | nnual principal payments on the mortgage notes payable, excluding the amortization of the premium or discount, for each of the next five 12-month periods ending June 30, and thereafter (in thousands): 2017 $ 11,469 2018 49,794 2019 46,963 2020 114,707 2021 89,006 Thereafter 229,622 $ 541,561 |
Schedule of Annual Amortization | nnual amortization of the premium or discount for each of the next five 12-month periods ending June 30, and thereafter (in thousands): 2017 $ 482 2018 401 2019 336 2020 331 2021 276 Thereafter 606 $ 2,432 |
Estimated Amortization of Deferred Financing Costs | Estimated amortization of the existing deferred financing costs for the next five 12-month periods ending June 30, and thereafter, is as follows (in thousands): 2017 $ 1,402 2018 1,271 2019 1,089 2020 850 2021 469 Thereafter 639 $ 5,720 |
CREDIT FACILITY (Tables)
CREDIT FACILITY (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Line of Credit Facility [Abstract] | |
Summary of the Revolving Credit Facilities | The following table presents a summary of the Company's credit facility (in thousands, except percentages): Weighted Average Interest Rate Balance Outstanding at Current Availability at Balance Maturity Interest Rate Basis (1) Current Three months ended June 30, Six Months Ended Lender June 30, 2016 December 31, 2015 2016 2015 2016 2015 Bank of America $ 5,394 $ 15,500 21,894 5/23/2017 LIBOR plus 3% 3.47% 3.40% 3.19% 3.43% 3.21% (1) Variable rate based on one-month LIBOR of 0.4651% (as of June 30, 2016 ). |
Schedule of Principal Payments | rincipal payments required by the credit facility for the 12-month period ending June 30, 2017 are approximately $5.4 million and none thereafter. |
ACCUMULATED OTHER COMPREHENSI32
ACCUMULATED OTHER COMPREHENSIVE LOSS (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Equity [Abstract] | |
Components of Accumulated Other Comprehensive Loss | The following table presents the changes in each component of the Company's accumulated other comprehensive loss for the six months ended June 30, 2016 (in thousands): Net unrealized loss January 1, 2016 $ (440 ) Reclassification adjustment for realized loss on designated derivative 72 Unrealized loss on designated derivatives (23 ) June 30, 2016 $ (391 ) |
CERTAIN RELATIONSHIPS AND REL33
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Related Party Transactions [Abstract] | |
Fees Earned From/Expenses Paid to Related Parties | The following table presents the Company's amounts payable to/receivable from related parties (in thousands): June 30, December 31, Due from related parties: RAI and affiliates $ 2,004 $ 1,421 Due to related parties: Advisor: Operating expense reimbursements $ — $ 286 Resource Real Estate Opportunity Manager, LLC: Property management fees 882 440 Other reimbursements 581 459 Other 14 — $ 1,477 $ 1,185 The following table presents the Company's fees earned/expenses paid to related parties (in thousands): Three Months Ended Six Months Ended June 30, June 30, 2016 2015 2016 2015 Fees earned / expenses paid to related parties: Advisor: Acquisition fees (1) $ — $ 3,687 $ 8 $ 5,169 Asset management fees (2) $ 2,674 $ 2,461 $ 5,381 $ 4,709 Disposition fees (3) $ 220 $ 270 $ 413 $ 1,031 Debt financing fees (4) $ — $ 474 $ — $ 670 Overhead allocation (5) $ 1,130 $ 934 $ 2,405 $ 1,822 Internal audit (5) $ — $ 7 $ — $ 14 Resource Real Estate Opportunity Manager LLC: Property management fees (2) $ 1,315 $ 1,131 $ 2,605 $ 2,238 Construction management fees (6) $ 250 $ 483 $ 492 $ 839 Information technology fees (5) $ 107 $ 83 $ 216 $ 166 Operating expense reimbursements (7) $ 62 $ 76 $ 130 $ 143 Debt servicing fees (2) $ 10 $ 20 $ 14 $ 25 Other: Ledgewood (5) $ 20 $ 83 $ 30 $ 144 Graphic Images (5) $ 60 $ 19 $ 60 $ 22 (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 gains on dispositions of properties and joint venture interests on the consolidated statements of operations and comprehensive loss. (4) Included in Mortgage notes payable, 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. (7) Included in Rental operating expenses on the consolidated statements of operations and comprehensive loss. |
EQUITY (Tables)
EQUITY (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Equity [Abstract] | |
Schedule of Shares Issued | As of June 30, 2016 , 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 7,777,113 77,300 Shares issued in conjunction with the Advisor's initial investment, 15,500 155 Total 73,674,067 $ 712,114 Shares redeemed (2,178,618 ) Total shares outstanding as of June 30, 2016 71,495,449 (1) Includes 276,056 shares issued to the Advisor. |
Schedule of Distributions | For the six months ended June 30, 2016 , the Company paid aggregate distributions of $21.5 million , including $7.1 million of distributions paid in cash and $14.4 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 28, 2016 $0.05 January 29, 2016 $ 2,423 $ 1,151 $ 3,574 February 26, 2016 0.05 February 29, 2016 2,418 1,167 3,585 March 30, 2016 0.05 March 31, 2016 2,415 1,172 3,587 April 28, 2016 0.05 April 29, 2016 2,414 1,181 3,595 May 27, 2016 0.05 June 3, 2016 2,380 1,226 3,606 June 29, 2016 0.05 June 30, 2016 2,357 1,208 3,565 $0.30 $ 14,407 $ 7,105 $ 21,512 |
FAIR VALUE MEASURES AND DISCL35
FAIR VALUE MEASURES AND DISCLOSURES (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
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 (in thousands): Level 1 Level 2 Level 3 Total June 30, 2016 Assets: Interest rate caps $ — $ 5 $ — $ 5 $ — $ 5 $ — $ 5 December 31, 2015 Assets: Interest rate caps $ — $ 32 $ — $ 32 $ — $ 32 $ — $ 32 |
Carrying and Fair Values of Loan Held for Investment, Net, Preferred Equity Investment, Mortgage Notes Payable, and Revolving Credit Facility | The carrying and fair values of the Company’s loans held for investment, net, preferred equity investments, mortgage note payable-outstanding borrowings, mortgage note payable -included in other liabilities associated with rental properties held for sale and credit facilities were as follows (in thousands): June 30, 2016 December 31, 2015 Carrying Amount Estimated Fair Value Carrying Amount Estimated Fair Value Loan held for investment, net $ 764 $ 1,151 $ 757 $ 1,151 Preferred equity investment $ — $ — $ 3,886 $ 3,908 Mortgage notes payable- outstanding borrowings $ (541,561 ) $ (535,783 ) $ (595,384 ) $ (573,693 ) Mortgage note payable- included in other liabilities associated with rental properties held for sale $ — $ — $ (16,443 ) $ (16,597 ) Credit facility $ (5,394 ) $ (5,394 ) $ (21,894 ) $ (21,894 ) |
DERIVATIVES AND HEDGING ACTIV36
DERIVATIVES AND HEDGING ACTIVITIES (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Outstanding Interest Rate Derivatives | As of June 30, 2016 , 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 8 $ 119,863 January 1, 2018 to May 3, 2019 |
Fair Value and Balance Sheet Location of Derivatives | The following table 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 June 30, 2016 and December 31, 2015 (in thousands): Asset Derivatives Liability Derivatives June 30, 2016 December 31, 2015 June 30, 2016 December 31, 2015 Balance Sheet Fair Value Balance Sheet Fair Value Balance Sheet Fair Value Balance Sheet Fair Value Interest rate caps $ 5 Interest rate caps $ 32 — $ — — $ — |
NATURE OF BUSINESS AND OPERAT37
NATURE OF BUSINESS AND OPERATIONS - Narrative (Details) - USD ($) $ in Thousands | 6 Months Ended | 24 Months Ended | 54 Months Ended |
Jun. 30, 2016 | Dec. 31, 2015 | Dec. 13, 2013 | |
Securities Financing Transaction [Line Items] | |||
Common stock issued through distribution reinvestment plan (in shares) | 1,300,000 | 5,300,000 | 1,200,000 |
Common stock issued through distribution reinvestment plan | $ 14,407 | $ 51,900 | |
Public offering | Common Stock | |||
Securities Financing Transaction [Line Items] | |||
Proceeds from issuance of stock under private offering | $ 645,800 | ||
Issuance of common stock (in shares) | 64,900,000 | ||
Public offering | Common Stock | Advisor | |||
Securities Financing Transaction [Line Items] | |||
Issuance of common stock (in shares) | 276,056 |
SUMMARY OF SIGNIFICANT ACCOUN38
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Principles of Consolidation (Details) - Unit | Jun. 30, 2016 | Jun. 29, 2016 | Jan. 28, 2016 | Jan. 26, 2016 | Dec. 31, 2015 |
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 8,935 | ||||
RRE Iroquois, LP (“Vista”) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 133 | ||||
RRE Cannery Holdings, LLC (“Cannery”) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 156 | ||||
RRE Williamsburg Holdings, LLC (“Williamsburg”) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 976 | ||||
RRE Park Forest Holdings, LLC (Park Forest) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 216 | ||||
RRE Deerfield Holdings, LLC (Deerfield) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 166 | ||||
RRE Autumn Wood Holdings, LLC (Autumn Wood) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 206 | ||||
RRE Village Square Holdings, LLC (Village Square) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 271 | ||||
RRE Brentdale Holdings, LLC (Brentdale) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 412 | ||||
RRE Jefferson Point Holdings, LLC (Jefferson Point) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 208 | ||||
RRE Centennial Holdings, LLC (Centennial) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 276 | ||||
RRE Pinnacle Holdings, LLC (Pinnacle) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 224 | ||||
RRE Jasmine Holdings, LLC (Jasmine) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 437 | ||||
RRE River Oaks Holdings, LLC (River Oaks) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 314 | ||||
RRE Nicollet Ridge Holdings, LLC (Nicollet Ridge) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 339 | ||||
RRE Addison Place Holdings, LLC (Addison Place) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 403 | ||||
PRIP Coursey, LLC (Evergreen at Coursey Place) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 352 | ||||
PRIP 500, LLC (Pinehurst) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 146 | ||||
PRIP 1102, LLC (Pheasant Run) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 160 | ||||
PRIP 11128, LLC (Retreat at Shawnee) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 342 | ||||
PRIP Pines, LLC (Pines of York) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 248 | ||||
RRE Chisholm Place Holdings LLC (Chisholm Place) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 142 | ||||
RRE Berkeley Run Holdings, LLC (Berkley Run) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 194 | ||||
RRE Berkeley Trace Holdings LLC (Berkley Trace) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 165 | ||||
RRE Merrywood Holdings, LLC (Merrywood) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 228 | ||||
RRE Sunset Ridge Holdings, LLC (Sunset Ridge) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 324 | ||||
RRE Parkridge Place Holdings, LLC (Parkridge Place) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 536 | ||||
RRE Woodmoor Holdings, LLC (Woodmoor) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 208 | ||||
RRE Gilbert Holdings, LLC (Springs at Gilbert) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 458 | ||||
RRE Bonita Glen Holdings, LLC (Bonita) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 295 | ||||
RRE Yorba Linda Holdings, LLC (Yorba Linda) | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 400 | ||||
Champion Farms | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Ownership % | 70.00% | 70.00% | |||
Fieldstone | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Ownership % | 83.00% | ||||
Conifer Place | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Ownership % | 42.50% | ||||
Stone Ridge | |||||
Subsidiary or Equity Method Investee [Line Items] | |||||
Number of Units | 188 | ||||
Ownership % | 83.40% |
SUMMARY OF SIGNIFICANT ACCOUN39
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Rental Property Useful Lives (Details) | 6 Months Ended |
Jun. 30, 2016 | |
Buildings | |
Real Estate Properties [Line Items] | |
Estimated useful lives | 27 years 6 months |
Building improvements | Minimum | |
Real Estate Properties [Line Items] | |
Estimated useful lives | 3 years |
Building improvements | Maximum | |
Real Estate Properties [Line Items] | |
Estimated useful lives | 27 years 6 months |
SUMMARY OF SIGNIFICANT ACCOUN40
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Narrative (Details) shares in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2016USD ($) | Jun. 30, 2015USD ($) | Jun. 30, 2016USD ($)Propertyshares | Jun. 30, 2015USD ($) | Dec. 31, 2015USD ($)Property | |
Assets Held for Sale [Abstract] | |||||
Number of rental properties held for sale (in property) | Property | 1 | 3 | |||
Rental Properties [Abstract] | |||||
Capitalization threshold for improvements and replacements | $ 1,000 | ||||
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 | |||
Total other income | 2,800,000 | 2,500,000 | 5,600,000 | 4,500,000 | |
Tenant Receivable [Abstract] | |||||
Allowance for uncollectable receivables | 4,399 | $ 4,399 | $ 24,100 | ||
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 (in shares) | shares | 50 | ||||
Reclassifications | |||||
Unamortized debt issuance costs | 5,720,000 | $ 5,720,000 | 6,513,000 | ||
Accounting Standards Update 2015-03 | Assets | |||||
Reclassifications | |||||
Unamortized debt issuance costs | (6,500,000) | ||||
Accounting Standards Update 2015-03 | Mortgage notes payable | |||||
Reclassifications | |||||
Unamortized debt issuance costs | $ 6,500,000 | ||||
Operating leases for residential rental properties | |||||
Revenue Recognition [Abstract] | |||||
Future minimum rental payments, current | 51,200,000 | 51,200,000 | |||
Future minimum rental payments, in two years | 346,000 | 346,000 | |||
Commercial rental properties and antenna rentals | |||||
Revenue Recognition [Abstract] | |||||
Future minimum rental payments, current | 362,000 | 362,000 | |||
Future minimum rental payments, in two years | 253,000 | 253,000 | |||
Future minimum rental payments, in three years | 169,000 | 169,000 | |||
Future minimum rental payments, in four years | 120,000 | 120,000 | |||
Future minimum rental payments, in five years | 11,000 | 11,000 | |||
Future minimum rental payments, thereafter | $ 0 | $ 0 | |||
Manager | |||||
Rental Properties [Abstract] | |||||
Construction management fee | 5.00% | ||||
Immaterial Error [Member] | General and Administrative Expense [Member] | |||||
Reclassifications | |||||
Payroll expense | (428,000) | (956,000) | |||
Immaterial Error [Member] | Operating Expense [Member] | |||||
Reclassifications | |||||
Payroll expense | $ 428,000 | $ 956,000 |
SUPPLEMENTAL CASH FLOW INFORM41
SUPPLEMENTAL CASH FLOW INFORMATION (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Non-cash financing and investing activities: | ||
Stock issued from the distribution reinvestment plan | $ 14,407 | $ 14,432 |
Deferred financing costs and escrow deposits funded directly by mortgage note and revolving credit facility | 0 | 10,709 |
Non-cash activity related to sales: | ||
Deconsolidation of mortgage note payable | 31,539 | 0 |
Deconsolidation of rental properties, net | 35,152 | 0 |
Noncontrolling interest of deconsolidated subsidiary | 3,613 | 0 |
Mortgage notes payable settled through sale of property | 35,422 | 0 |
Sale of property used to settle mortgage notes payable | 35,422 | 0 |
Assets and liabilities assumed in acquisitions: | ||
Debt assumed | 0 | 40,185 |
Other liabilities assumed | 0 | 99 |
Rental properties, net | 0 | 40,284 |
Cash paid during the period for: | ||
Interest | $ 10,538 | $ 9,388 |
RENTAL PROPERTIES, NET (Details
RENTAL PROPERTIES, NET (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Jun. 30, 2016USD ($)Property | Dec. 31, 2015USD ($)Property | Jun. 30, 2015USD ($) | Jun. 30, 2016USD ($)Property | Jun. 30, 2015USD ($) | Dec. 31, 2015USD ($)Property | Jan. 28, 2016 | |
Investments in rental properties [Abstract] | |||||||
Land | $ 169,019 | $ 180,533 | $ 169,019 | $ 180,533 | |||
Building and improvements | 734,028 | 775,239 | 734,028 | 775,239 | |||
Furniture, fixtures and equipment | 29,064 | 28,928 | 29,064 | 28,928 | |||
Construction in progress | 3,903 | 2,949 | 3,903 | 2,949 | |||
Rental properties, gross | 936,014 | 987,649 | 936,014 | 987,649 | |||
Less: accumulated depreciation | (86,318) | (71,151) | (86,318) | (71,151) | |||
Rental properties, net | 849,696 | $ 916,498 | 849,696 | $ 916,498 | |||
Depreciation expense | 10,900 | $ 10,600 | 22,100 | $ 19,400 | |||
Gain (loss) on disposal of assets | $ (144) | $ (1,372) | $ (286) | $ (2,481) | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Number of rental properties held for sale (in property) | Property | 1 | 3 | |||||
Champion Farms | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Ownership percentage | 70.00% | 70.00% | 70.00% | ||||
The Nesbit Palisades | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Number of rental properties held for sale (in property) | Property | 1 | ||||||
Contract Sales Price | $ 26,600 | $ 26,600 | |||||
Conifer Place and Ivy at Clear Creek | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Number of rental properties held for sale (in property) | Property | 2 | ||||||
Contract Sales Price | $ 43,900 | $ 43,900 |
OTHER INVESTMENTS - Narrative (
OTHER INVESTMENTS - Narrative (Details) $ in Thousands | Jun. 06, 2016USD ($) | Nov. 12, 2014USD ($) | Mar. 15, 2011USD ($)Loan | Jun. 30, 2016USD ($) | Mar. 31, 2016USD ($) | Jun. 30, 2015USD ($) |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Payments to acquire preferred equity investment | $ 408 | $ 0 | ||||
Exit fee received | $ 230 | |||||
Number of nonperforming promissory notes (in loan) | Loan | 2 | |||||
Number of performing promissory notes (in loan) | Loan | 2 | |||||
Purchase price of promissory note | $ 3,100 | |||||
Spring Hills Investors Limited Partner, LLC | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Payments to acquire preferred equity investment | $ 3,500 | $ 800 | ||||
Dividend receivable rate | 12.00% | |||||
Monthly dividend receivable rate | 7.00% |
OTHER INVESTMENTS - Components
OTHER INVESTMENTS - Components of Investments (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Investments, Debt and Equity Securities [Abstract] | ||
Loan held for investment, net | $ 764 | $ 757 |
Preferred equity investment, net | 0 | 3,886 |
Loans held for investment and preferred equity investments, net | $ 764 | $ 4,643 |
OTHER INVESTMENTS - Aging Sched
OTHER INVESTMENTS - Aging Schedule of Investments (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Loans Held for Investment [Line Items] | ||
Financing receivable | $ 764 | $ 757 |
Current | ||
Loans Held for Investment [Line Items] | ||
Financing receivable | 764 | 757 |
30−89 days | ||
Loans Held for Investment [Line Items] | ||
Financing receivable | 0 | 0 |
90−180 days | ||
Loans Held for Investment [Line Items] | ||
Financing receivable | 0 | 0 |
Greater than 180 days | ||
Loans Held for Investment [Line Items] | ||
Financing receivable | $ 0 | $ 0 |
OTHER INVESTMENTS - Recorded In
OTHER INVESTMENTS - Recorded Investment, Credit Quality Indicator (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Financing Receivable, Recorded Investment [Line Items] | ||
Loan held for investment, net | $ 764 | $ 757 |
Performing | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan held for investment, net | 764 | 757 |
Nonperforming | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan held for investment, net | $ 0 | $ 0 |
OTHER INVESTMENTS - Terms of Lo
OTHER INVESTMENTS - Terms of Loans Held for Investment (Details) - Trail Ridge - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2016 | Dec. 31, 2015 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Unpaid Principal Balance | $ 969 | $ 981 |
Unamortized Discount | (212) | (231) |
Deferred expenses, net | 7 | 7 |
Net book value | $ 764 | $ 757 |
Interest rate | 7.50% | |
Average monthly payment | $ 8 |
DISPOSITION OF PROPERTIES AND48
DISPOSITION OF PROPERTIES AND DECONSOLIDATION OF INTERESTS - Sales Activity (Details) - USD ($) $ in Thousands | Jan. 27, 2016 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 09, 2016 | Feb. 17, 2016 | Jan. 29, 2016 | Mar. 02, 2015 | Feb. 27, 2015 | Jan. 29, 2015 | Jan. 26, 2015 |
Conifer Place | ||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||
Contract Sales Price | $ 42,500 | |||||||||||
Six months ended June 30, 2016 | $ 0 | $ 9,897 | ||||||||||
Conifer Place | Noncontrolling interests | ||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||
Six months ended June 30, 2016 | $ 6,200 | |||||||||||
Champion Farms | ||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||
Contract Sales Price | $ 7,590 | |||||||||||
Six months ended June 30, 2016 | 0 | 1,066 | ||||||||||
The Ivy at Clear Creek | ||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||
Contract Sales Price | $ 19,400 | |||||||||||
Six months ended June 30, 2016 | 0 | 6,792 | ||||||||||
Affinity at Winter Park | ||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||
Contract Sales Price | $ 17,500 | |||||||||||
Six months ended June 30, 2016 | 5,605 | 5,605 | ||||||||||
Fieldstone | ||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||
Contract Sales Price | 7,514 | 7,514 | ||||||||||
Six months ended June 30, 2016 | 4,096 | 4,096 | ||||||||||
The Alcove Apartments | ||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||
Contract Sales Price | $ 11,050 | |||||||||||
Six months ended June 30, 2016 | $ (1) | $ 3,784 | ||||||||||
107th Avenue Apartments | ||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||
Contract Sales Price | $ 250 | |||||||||||
Six months ended June 30, 2016 | 0 | 50 | ||||||||||
The Redford Apartments | ||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||
Contract Sales Price | $ 32,959 | |||||||||||
Six months ended June 30, 2016 | (9) | 15,303 | ||||||||||
Cityside Apartments | ||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||
Contract Sales Price | $ 24,500 | |||||||||||
Six months ended June 30, 2016 | 0 | 10,028 | ||||||||||
One Hundred Chevy Chase | ||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||
Contract Sales Price | 13,500 | 13,500 | ||||||||||
Six months ended June 30, 2016 | 4,386 | 4,386 | ||||||||||
Multifamily residential apartment community | ||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||
Six months ended June 30, 2016 | $ 9,701 | $ 4,376 | $ 27,456 | $ 33,551 |
DISPOSITION OF PROPERTIES AND49
DISPOSITION OF PROPERTIES AND DECONSOLIDATION OF INTERESTS - Revenue and Income (Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Net Income (Loss) Attributable to Properties Sold | $ 2,427 | $ (12,476) | $ 10,907 | $ 4,563 |
Noncontrolling interests | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Net Income (Loss) Attributable to Properties Sold | 6,306 | |||
Conifer Place | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Disposal Group, Including Discontinued Operation, Revenue | 0 | 365 | ||
Net Income (Loss) Attributable to Properties Sold | 0 | 9,942 | ||
Conifer Place | Noncontrolling interests | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Net Income (Loss) Attributable to Properties Sold | 6,300 | |||
Champion Farms | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Disposal Group, Including Discontinued Operation, Revenue | 0 | 220 | ||
Net Income (Loss) Attributable to Properties Sold | 0 | 1,125 | ||
The Ivy at Clear Creek | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Disposal Group, Including Discontinued Operation, Revenue | 0 | 386 | ||
Net Income (Loss) Attributable to Properties Sold | (1) | 6,627 | ||
Affinity at Winter Park | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Disposal Group, Including Discontinued Operation, Revenue | 463 | 1,008 | ||
Net Income (Loss) Attributable to Properties Sold | 5,742 | 5,748 | ||
Fieldstone | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Disposal Group, Including Discontinued Operation, Revenue | 789 | 1,548 | ||
Net Income (Loss) Attributable to Properties Sold | 4,243 | 4,325 | ||
The Alcove Apartments | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Disposal Group, Including Discontinued Operation, Revenue | 1 | 199 | ||
Net Income (Loss) Attributable to Properties Sold | 4 | 3,810 | ||
107th Avenue Apartments | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Disposal Group, Including Discontinued Operation, Revenue | 0 | 3 | ||
Net Income (Loss) Attributable to Properties Sold | 0 | 50 | ||
The Redford Apartments | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Disposal Group, Including Discontinued Operation, Revenue | (40) | 1,274 | ||
Net Income (Loss) Attributable to Properties Sold | (67) | 15,670 | ||
Cityside Apartments | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Disposal Group, Including Discontinued Operation, Revenue | 7 | 701 | ||
Net Income (Loss) Attributable to Properties Sold | 0 | 10,310 | ||
One Hundred Chevy Chase | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Disposal Group, Including Discontinued Operation, Revenue | 443 | 832 | ||
Net Income (Loss) Attributable to Properties Sold | 4,329 | 4,108 | ||
Multifamily residential apartment community | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Disposal Group, Including Discontinued Operation, Revenue | 1,252 | 411 | 3,527 | 3,009 |
Net Income (Loss) Attributable to Properties Sold | $ 9,984 | $ 4,266 | $ 27,767 | $ 33,948 |
DISPOSITION OF PROPERTIES AND50
DISPOSITION OF PROPERTIES AND DECONSOLIDATION OF INTERESTS - Roll Forward of Activity in Goodwill (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2016USD ($) | |
Goodwill [Roll Forward] | |
Beginning balance | $ 1,231 |
Sale of Conifer, Champion, and Fieldstone | (520) |
Ending balance | $ 711 |
IDENTIFIED INTANGIBLE ASSETS,51
IDENTIFIED INTANGIBLE ASSETS, NET - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 | |
Finite-Lived Intangible Assets [Line Items] | |||||
Identified intangible assets, net | $ 154 | $ 154 | $ 374 | ||
Weighted average remaining life | 0 months | 1 month | |||
Amortization expense | 4 | $ 1,500 | $ 220 | $ 3,000 | |
Acquired in-place leases | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Identified intangible assets, net | 154 | 154 | $ 374 | ||
Accumulated amortization | 25,100 | 25,100 | $ 28,400 | ||
Antennae leases | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Annual expected amortization expense through 2025 | $ 16 | $ 16 |
IDENTIFIED INTANGIBLE ASSETS,52
IDENTIFIED INTANGIBLE ASSETS, NET - Antennae Leases (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2,017 | $ 16 | |
2,018 | 16 | |
2,019 | 16 | |
2,020 | 16 | |
2,021 | 16 | |
Thereafter | 74 | |
Total | $ 154 | $ 374 |
MORTGAGE NOTES PAYABLE, NET - S
MORTGAGE NOTES PAYABLE, NET - Summary (Details) - USD ($) $ in Thousands | Jan. 01, 2016 | Mar. 31, 2016 | Feb. 29, 2016 | Jun. 30, 2016 | Dec. 31, 2015 |
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | $ 541,561 | $ 595,384 | |||
Premium (Discount) | 2,432 | 2,674 | |||
Deferred finance costs, net | (5,720) | (6,513) | |||
Carrying Value | $ 538,273 | 591,545 | |||
LIBOR | |||||
Participating Mortgage Loans [Line Items] | |||||
Basis spread on variable rate | 2.25% | 2.00% | |||
Extension period of variable interest rate | 1 year | ||||
Revolving credit facility | LIBOR | |||||
Participating Mortgage Loans [Line Items] | |||||
Basis spread on variable rate | 0.4651% | ||||
Vista Apartment Homes | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | $ 15,398 | 15,573 | |||
Premium (Discount) | 0 | 0 | |||
Deferred finance costs, net | (197) | (216) | |||
Carrying Value | $ 15,201 | 15,357 | |||
Annual Interest Rate | 2.76% | ||||
Average Monthly Debt Service | $ 65 | ||||
Average Monthly Escrow | 16 | ||||
Cannery Lofts | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 8,065 | 8,148 | |||
Premium (Discount) | 0 | 0 | |||
Deferred finance costs, net | (116) | (131) | |||
Carrying Value | $ 7,949 | 8,017 | |||
Annual Interest Rate | 3.77% | ||||
Average Monthly Debt Service | $ 40 | ||||
Average Monthly Escrow | 26 | ||||
Deerfield | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 10,439 | 10,517 | |||
Premium (Discount) | 0 | 0 | |||
Deferred finance costs, net | (142) | (159) | |||
Carrying Value | $ 10,297 | 10,358 | |||
Annual Interest Rate | 4.66% | ||||
Average Monthly Debt Service | $ 54 | ||||
Average Monthly Escrow | 29 | ||||
The Ivy at Clear Creek | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 0 | 8,431 | |||
Premium (Discount) | 0 | 0 | |||
Deferred finance costs, net | 0 | (136) | |||
Carrying Value | 0 | 8,295 | |||
Trailpoint at the Woodlands | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 18,852 | 19,013 | |||
Premium (Discount) | 0 | 0 | |||
Deferred finance costs, net | (240) | (257) | |||
Carrying Value | $ 18,612 | 18,756 | |||
Annual Interest Rate | 2.88% | ||||
Average Monthly Debt Service | $ 69 | ||||
Average Monthly Escrow | 67 | ||||
Verona Apartment Homes | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 22,176 | 22,402 | |||
Premium (Discount) | 0 | 0 | |||
Deferred finance costs, net | (148) | (179) | |||
Carrying Value | $ 22,028 | 22,223 | |||
Annual Interest Rate | 3.60% | ||||
Average Monthly Debt Service | $ 106 | ||||
Average Monthly Escrow | 41 | ||||
Skyview Apartment Homes | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 17,907 | 18,089 | |||
Premium (Discount) | 0 | 0 | |||
Deferred finance costs, net | (123) | (148) | |||
Carrying Value | $ 17,784 | 17,941 | |||
Annual Interest Rate | 3.60% | ||||
Average Monthly Debt Service | $ 85 | ||||
Average Monthly Escrow | 21 | ||||
The Nesbit Palisades | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 20,298 | 20,298 | |||
Premium (Discount) | 0 | 0 | |||
Deferred finance costs, net | (290) | (309) | |||
Carrying Value | $ 20,008 | 19,989 | |||
Annual Interest Rate | 2.42% | ||||
Average Monthly Debt Service | $ 59 | ||||
Average Monthly Escrow | 54 | ||||
Maxwell Townhomes | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 13,728 | 13,850 | |||
Premium (Discount) | 0 | 0 | |||
Deferred finance costs, net | (152) | (167) | |||
Carrying Value | $ 13,576 | 13,683 | |||
Annual Interest Rate | 4.32% | ||||
Average Monthly Debt Service | $ 71 | ||||
Average Monthly Escrow | 63 | ||||
Fieldstone | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 0 | 15,332 | |||
Premium (Discount) | 0 | 0 | |||
Deferred finance costs, net | 0 | (37) | |||
Carrying Value | 0 | 15,295 | |||
Pinehurst | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 4,040 | 4,111 | |||
Premium (Discount) | 0 | 0 | |||
Deferred finance costs, net | 0 | 0 | |||
Carrying Value | $ 4,040 | 4,111 | |||
Annual Interest Rate | 2.97% | ||||
Average Monthly Debt Service | $ 23 | ||||
Average Monthly Escrow | 12 | ||||
Pheasant Run | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 6,250 | 6,250 | |||
Premium (Discount) | 71 | 100 | |||
Deferred finance costs, net | (15) | (20) | |||
Carrying Value | $ 6,306 | 6,330 | |||
Annual Interest Rate | 5.95% | ||||
Average Monthly Debt Service | $ 31 | ||||
Average Monthly Escrow | 15 | ||||
Retreat of Shawnee | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 12,993 | 13,090 | |||
Premium (Discount) | 124 | 164 | |||
Deferred finance costs, net | (33) | (44) | |||
Carrying Value | $ 13,084 | 13,210 | |||
Annual Interest Rate | 5.58% | ||||
Average Monthly Debt Service | $ 78 | ||||
Average Monthly Escrow | 28 | ||||
Conifer Place | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 0 | 27,074 | |||
Premium (Discount) | 0 | 0 | |||
Deferred finance costs, net | 0 | 0 | |||
Carrying Value | 0 | 27,074 | |||
Evergreen at Coursey Place | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 27,330 | 27,548 | |||
Premium (Discount) | 112 | 123 | |||
Deferred finance costs, net | (107) | (120) | |||
Carrying Value | $ 27,335 | 27,551 | |||
Annual Interest Rate | 5.07% | ||||
Average Monthly Debt Service | $ 154 | ||||
Average Monthly Escrow | 48 | ||||
Pines of York | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 15,134 | 15,267 | |||
Premium (Discount) | (331) | (363) | |||
Deferred finance costs, net | (63) | (69) | |||
Carrying Value | $ 14,740 | 14,835 | |||
Annual Interest Rate | 4.46% | ||||
Average Monthly Debt Service | $ 80 | ||||
Average Monthly Escrow | 37 | ||||
The Estates at Johns Creek | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 50,000 | 50,000 | |||
Premium (Discount) | 0 | 0 | |||
Deferred finance costs, net | (465) | (526) | |||
Carrying Value | $ 49,535 | 49,474 | |||
Annual Interest Rate | 3.38% | ||||
Average Monthly Debt Service | $ 220 | ||||
Average Monthly Escrow | 102 | ||||
Chisholm Place | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 11,587 | 11,587 | |||
Premium (Discount) | 0 | 0 | |||
Deferred finance costs, net | (153) | (163) | |||
Carrying Value | $ 11,434 | 11,424 | |||
Annual Interest Rate | 2.86% | ||||
Average Monthly Debt Service | $ 39 | ||||
Average Monthly Escrow | 38 | ||||
Perimeter Circle | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 17,478 | 17,657 | |||
Premium (Discount) | 0 | 0 | |||
Deferred finance costs, net | (172) | (202) | |||
Carrying Value | $ 17,306 | 17,455 | |||
Annual Interest Rate | 3.42% | ||||
Average Monthly Debt Service | $ 81 | ||||
Average Monthly Escrow | 53 | ||||
Perimeter 5,550 | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 13,795 | 13,935 | |||
Premium (Discount) | 0 | 0 | |||
Deferred finance costs, net | (143) | (167) | |||
Carrying Value | $ 13,652 | 13,768 | |||
Annual Interest Rate | 3.42% | ||||
Average Monthly Debt Service | $ 64 | ||||
Average Monthly Escrow | 41 | ||||
Aston at Cinco Ranch | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 23,572 | 23,772 | |||
Premium (Discount) | 0 | 0 | |||
Deferred finance costs, net | (299) | (328) | |||
Carrying Value | $ 23,273 | 23,444 | |||
Annual Interest Rate | 4.34% | ||||
Average Monthly Debt Service | $ 120 | ||||
Average Monthly Escrow | 63 | ||||
Sunset Ridge 1 | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 19,913 | 20,121 | |||
Premium (Discount) | 295 | 329 | |||
Deferred finance costs, net | (234) | (261) | |||
Carrying Value | $ 19,974 | 20,189 | |||
Annual Interest Rate | 4.58% | ||||
Average Monthly Debt Service | $ 113 | ||||
Average Monthly Escrow | 91 | ||||
Sunset Ridge 2 | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 2,975 | 3,002 | |||
Premium (Discount) | 40 | 45 | |||
Deferred finance costs, net | (30) | (34) | |||
Carrying Value | $ 2,985 | 3,013 | |||
Annual Interest Rate | 4.54% | ||||
Average Monthly Debt Service | $ 16 | ||||
Average Monthly Escrow | 0 | ||||
Calloway at Las Colinas | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 35,414 | 35,740 | |||
Premium (Discount) | 0 | 0 | |||
Deferred finance costs, net | (339) | (372) | |||
Carrying Value | $ 35,075 | 35,368 | |||
Annual Interest Rate | 3.87% | ||||
Average Monthly Debt Service | $ 171 | ||||
Average Monthly Escrow | 113 | ||||
South Lamar Village | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 12,560 | 12,682 | |||
Premium (Discount) | 0 | 0 | |||
Deferred finance costs, net | (158) | (184) | |||
Carrying Value | $ 12,402 | 12,498 | |||
Annual Interest Rate | 3.64% | ||||
Average Monthly Debt Service | $ 59 | ||||
Average Monthly Escrow | 46 | ||||
Heritage Pointe | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 26,280 | 26,280 | |||
Premium (Discount) | 0 | 0 | |||
Deferred finance costs, net | (348) | (370) | |||
Carrying Value | $ 25,932 | 25,910 | |||
Annual Interest Rate | 2.35% | ||||
Average Monthly Debt Service | $ 89 | ||||
Average Monthly Escrow | 44 | ||||
Yorba Linda | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 67,500 | 67,500 | |||
Premium (Discount) | 0 | 0 | |||
Deferred finance costs, net | (761) | (860) | |||
Carrying Value | $ 66,739 | 66,640 | |||
Annual Interest Rate | 2.22% | ||||
Average Monthly Debt Service | $ 158 | ||||
Average Monthly Escrow | 0 | ||||
Villages at Bonita Glen | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 27,089 | 27,265 | |||
Premium (Discount) | 2,121 | 2,276 | |||
Deferred finance costs, net | (364) | (391) | |||
Carrying Value | $ 28,846 | 29,150 | |||
Annual Interest Rate | 5.33% | ||||
Average Monthly Debt Service | $ 152 | ||||
Average Monthly Escrow | 38 | ||||
Stone Ridge | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 5,288 | 5,350 | |||
Premium (Discount) | 0 | 0 | |||
Deferred finance costs, net | (142) | (153) | |||
Carrying Value | $ 5,146 | 5,197 | |||
Annual Interest Rate | 2.33% | ||||
Average Monthly Debt Service | $ 21 | ||||
Average Monthly Escrow | 17 | ||||
The Westside Apartments | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 23,000 | 23,000 | |||
Premium (Discount) | 0 | 0 | |||
Deferred finance costs, net | (273) | (351) | |||
Carrying Value | $ 22,727 | 22,649 | |||
Annual Interest Rate | 2.42% | ||||
Average Monthly Debt Service | $ 61 | ||||
Average Monthly Escrow | 0 | ||||
Tech Center Square | |||||
Participating Mortgage Loans [Line Items] | |||||
Outstanding Borrowings | 12,500 | 12,500 | |||
Premium (Discount) | 0 | 0 | |||
Deferred finance costs, net | (213) | (159) | |||
Carrying Value | $ 12,287 | $ 12,341 | |||
Annual Interest Rate | 3.05% | ||||
Average Monthly Debt Service | $ 53 | ||||
Average Monthly Escrow | $ 25 |
MORTGAGE NOTES PAYABLE, NET - A
MORTGAGE NOTES PAYABLE, NET - Annual Principal Payments (Details) $ in Thousands | Jun. 30, 2016USD ($) |
Debt Disclosure [Abstract] | |
2,017 | $ 11,469 |
2,018 | 49,794 |
2,019 | 46,963 |
2,020 | 114,707 |
2,021 | 89,006 |
Thereafter | 229,622 |
Total | $ 541,561 |
MORTGAGE NOTES PAYABLE, NET -55
MORTGAGE NOTES PAYABLE, NET - Amortization of Fair Value Adjustments (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Debt Disclosure [Abstract] | ||
2,017 | $ 482 | |
2,018 | 401 | |
2,019 | 336 | |
2,020 | 331 | |
2,021 | 276 | |
Thereafter | 606 | |
Amortization of fair value adjustments | $ 2,432 | $ 2,674 |
MORTGAGE NOTES PAYABLE, NET - D
MORTGAGE NOTES PAYABLE, NET - Deferred Financing Costs (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Debt Disclosure [Abstract] | ||
2,017 | $ 1,402 | |
2,018 | 1,271 | |
2,019 | 1,089 | |
2,020 | 850 | |
2,021 | 469 | |
Thereafter | 639 | |
Deferred financing costs, net | $ 5,720 | $ 6,513 |
MORTGAGE NOTES PAYABLE, NET - N
MORTGAGE NOTES PAYABLE, NET - Narrative (Details) - USD ($) | 1 Months Ended | 2 Months Ended | 3 Months Ended | 6 Months Ended | ||||
Mar. 31, 2016 | Feb. 29, 2016 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 | Dec. 27, 2013 | |
Guarantor Obligations [Line Items] | ||||||||
Restricted cash related to escrow deposits | $ 6,400,000 | $ 6,400,000 | $ 10,000,000 | |||||
Renovations completed | 734,028,000 | 734,028,000 | 775,239,000 | |||||
Amortization of deferred financing costs | 1,232,000 | $ 906,000 | ||||||
Accumulated amortization, deferred finance costs | 2,700,000 | 2,700,000 | $ 2,400,000 | |||||
U.S. Bank | ||||||||
Guarantor Obligations [Line Items] | ||||||||
Earn-out holdback allowed when criteria are met | $ 29,700,000 | |||||||
Amount available to draw | 6,700,000 | $ 6,700,000 | ||||||
LIBOR | ||||||||
Guarantor Obligations [Line Items] | ||||||||
Basis spread on variable rate | 2.25% | 2.00% | ||||||
LIBOR | Revolving credit facility | ||||||||
Guarantor Obligations [Line Items] | ||||||||
Basis spread on variable rate | 0.4651% | |||||||
The Estates at Johns Creek | ||||||||
Guarantor Obligations [Line Items] | ||||||||
Renovations completed | 6,900,000 | $ 6,900,000 | ||||||
Payment guarantee | U.S. Bank | ||||||||
Guarantor Obligations [Line Items] | ||||||||
Guaranty for completion and payment of costs of completion (no less than) | $ 6,500,000 | |||||||
Payment guarantee | The Estates at Johns Creek | ||||||||
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 | Interest expense | ||||||||
Guarantor Obligations [Line Items] | ||||||||
Increase (decrease) in interest expense due to fair value adjustments | (122,000) | $ (184,000) | (242,000) | (374,000) | ||||
Covenants included in mortgage for Yorba Linda | ||||||||
Guarantor Obligations [Line Items] | ||||||||
Earn-out holdback allowed when criteria are met | 7,500,000 | 7,500,000 | ||||||
Mortgages | Interest expense | ||||||||
Guarantor Obligations [Line Items] | ||||||||
Amortization of deferred financing costs | $ 513,000 | $ 361,000 | $ 1,012,000 | $ 719,000 |
CREDIT FACILITY - Summary of Re
CREDIT FACILITY - Summary of Revolving Credit Facilities (Details) - USD ($) $ in Thousands | 1 Months Ended | 2 Months Ended | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2016 | Feb. 29, 2016 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 | |
Line of Credit Facility [Line Items] | |||||||
Credit facility | $ 5,394 | $ 5,394 | $ 21,894 | ||||
LIBOR | |||||||
Line of Credit Facility [Line Items] | |||||||
Basis spread on variable rate | 2.25% | 2.00% | |||||
Revolving credit facility | LIBOR | |||||||
Line of Credit Facility [Line Items] | |||||||
Basis spread on variable rate | 0.4651% | ||||||
Revolving credit facility | Bank of America | |||||||
Line of Credit Facility [Line Items] | |||||||
Credit facility | 5,394 | $ 5,394 | $ 21,894 | ||||
Line of Credit Facility, Current Availability | $ 15,500 | $ 15,500 | |||||
Line of Credit Facility, Current Interest Rate | 3.47% | 3.47% | |||||
Line of Credit Facility, Weighted Average Interest Rate | 3.40% | 3.19% | 3.43% | 3.21% | |||
Basis spread on variable rate | 3.00% |
CREDIT FACILITY - Narrative (De
CREDIT FACILITY - Narrative (Details) - USD ($) | Dec. 02, 2011 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 |
Line of Credit Facility [Line Items] | ||||||
Satisfaction of coverage requirements from date of advance, term | 36 months | |||||
Deferred financing costs, net | $ 5,720,000 | $ 5,720,000 | $ 6,513,000 | |||
Amortization of deferred financing costs | 1,232,000 | $ 906,000 | ||||
Estimated amortization of deferred financing costs, current | 1,402,000 | 1,402,000 | ||||
Estimated amortization of deferred financing costs, in two years | 1,271,000 | 1,271,000 | ||||
Principal payments required by the credit facility in the next 12 months | 11,469,000 | 11,469,000 | ||||
Revolving credit facility | ||||||
Line of Credit Facility [Line Items] | ||||||
Principal payments required by the credit facility in the next 12 months | 5,400,000 | 5,400,000 | ||||
Principal payments required by the credit facility, thereafter | 0 | 0 | ||||
Bank of America | ||||||
Line of Credit Facility [Line Items] | ||||||
Estimated amortization of deferred financing costs, current | 169,000 | 169,000 | ||||
Estimated amortization of deferred financing costs, thereafter | 0 | 0 | ||||
Bank of America | Interest expense | ||||||
Line of Credit Facility [Line Items] | ||||||
Amortization of deferred financing costs | 150,000 | $ 131,000 | 220,000 | 187,000 | ||
Bank of America | Prepaid expenses and other assets | ||||||
Line of Credit Facility [Line Items] | ||||||
Deferred financing costs, net | 169,000 | 169,000 | $ 389,000 | |||
Bank of America | Revolving credit facility | ||||||
Line of Credit Facility [Line Items] | ||||||
Line of credit facility collateral amount | 42,000,000 | 42,000,000 | ||||
Weighted average borrowings | $ 11,600,000 | $ 9,200,000 | $ 13,300,000 | $ 6,400,000 | ||
Extension fee | 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% |
ACCUMULATED OTHER COMPREHENSI60
ACCUMULATED OTHER COMPREHENSIVE LOSS (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Accumulated Other Comprehensive Income [Rollforward] | ||||
Beginning balance | $ 425,246 | |||
Reclassification adjustment for realized loss on derivative due to sale | $ 0 | $ 0 | 72 | $ 0 |
Ending balance | 407,040 | 407,040 | ||
Net unrealized loss on derivatives | ||||
Accumulated Other Comprehensive Income [Rollforward] | ||||
Beginning balance | (440) | |||
Unrealized loss on designated derivatives | (23) | |||
Ending balance | $ (391) | $ (391) |
CERTAIN RELATIONSHIPS AND REL61
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS - Narrative (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | |
Mar. 31, 2015 | Jun. 30, 2016 | Jun. 30, 2016 | Jun. 30, 2015 | |
Related Party Transaction [Line Items] | ||||
Insurance pool, amount of general liability losses covered | $ 50,000 | $ 50,000 | ||
Payment into insurance pools | 1,700,000 | 1,700,000 | ||
Terms of agreement | 1 year | |||
RAI | ||||
Related Party Transaction [Line Items] | ||||
Insurance pool, amount of property losses covered | 2,500,000 | 2,500,000 | ||
Catastrophic insurance, amount of losses covered | $ 140,000,000 | $ 140,000,000 | ||
Advisor | ||||
Related Party Transaction [Line Items] | ||||
Terms of agreement, renewal period | 1 year | |||
Percentage acquisition fee paid to advisor | 2.00% | |||
Monthly asset management fee | 0.083% | |||
Percentage annual asset management fee | 1.00% | |||
Disposition fee | 50.00% | |||
Debt disposition fee, as a percentage of the contract sales price | 2.75% | |||
Debt financing fee | 0.50% | |||
Manager | ||||
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 REL62
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS - Schedule of Transactions (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 | |
Related Party Transaction [Line Items] | |||||
Due from related parties | $ 2,004 | $ 2,004 | $ 1,421 | ||
Due to related parties | 1,477 | 1,477 | 1,185 | ||
RAI and affiliates | Insurance fund held in escrow | |||||
Related Party Transaction [Line Items] | |||||
Due from related parties | 2,004 | 2,004 | 1,421 | ||
Advisor | Operating expense reimbursements | |||||
Related Party Transaction [Line Items] | |||||
Due to related parties | 0 | 0 | 286 | ||
Advisor | Acquisition fees | |||||
Related Party Transaction [Line Items] | |||||
Fees earned / expenses paid to related parties | 0 | $ 3,687 | 8 | $ 5,169 | |
Advisor | Asset management fees | |||||
Related Party Transaction [Line Items] | |||||
Fees earned / expenses paid to related parties | 2,674 | 2,461 | 5,381 | 4,709 | |
Advisor | Disposition fees | |||||
Related Party Transaction [Line Items] | |||||
Fees earned / expenses paid to related parties | 220 | 270 | 413 | 1,031 | |
Advisor | Debt financing fees | |||||
Related Party Transaction [Line Items] | |||||
Fees earned / expenses paid to related parties | 0 | 474 | 0 | 670 | |
Advisor | Overhead allocation | |||||
Related Party Transaction [Line Items] | |||||
Fees earned / expenses paid to related parties | 1,130 | 934 | 2,405 | 1,822 | |
Advisor | Internal audit | |||||
Related Party Transaction [Line Items] | |||||
Fees earned / expenses paid to related parties | 0 | 7 | 0 | 14 | |
Resource Real Estate Opportunity Manager, LLC | Operating expense reimbursements | |||||
Related Party Transaction [Line Items] | |||||
Fees earned / expenses paid to related parties | 62 | 76 | 130 | 143 | |
Resource Real Estate Opportunity Manager, LLC | Property management fees | |||||
Related Party Transaction [Line Items] | |||||
Due to related parties | 882 | 882 | 440 | ||
Fees earned / expenses paid to related parties | 1,315 | 1,131 | 2,605 | 2,238 | |
Resource Real Estate Opportunity Manager, LLC | Other reimbursements | |||||
Related Party Transaction [Line Items] | |||||
Due to related parties | 581 | 581 | 459 | ||
Resource Real Estate Opportunity Manager, LLC | Construction management fees | |||||
Related Party Transaction [Line Items] | |||||
Fees earned / expenses paid to related parties | 250 | 483 | 492 | 839 | |
Resource Real Estate Opportunity Manager, LLC | Information technology fees | |||||
Related Party Transaction [Line Items] | |||||
Fees earned / expenses paid to related parties | 107 | 83 | 216 | 166 | |
Resource Real Estate Opportunity Manager, LLC | Debt servicing fees | |||||
Related Party Transaction [Line Items] | |||||
Fees earned / expenses paid to related parties | 10 | 20 | 14 | 25 | |
Other | |||||
Related Party Transaction [Line Items] | |||||
Due to related parties | 14 | 14 | $ 0 | ||
Ledgewood | |||||
Related Party Transaction [Line Items] | |||||
Fees earned / expenses paid to related parties | 20 | 83 | 30 | 144 | |
Graphic Images | |||||
Related Party Transaction [Line Items] | |||||
Fees earned / expenses paid to related parties | $ 60 | $ 19 | $ 60 | $ 22 |
EQUITY - Preferred Stock (Detai
EQUITY - Preferred Stock (Details) - $ / shares | Jun. 30, 2016 | Dec. 31, 2015 |
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 | 6 Months Ended | |
Jun. 30, 2016 | Dec. 31, 2015 | |
Class of Stock [Line Items] | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Shares Issued (in shares) | 73,674,067 | 72,333,652 |
Shares redeemed (in shares) | (2,178,618) | |
Total shares outstanding at end of period | 71,495,449 | |
Gross Proceeds | $ 712,114 | |
Shares issued through private offering | ||
Class of Stock [Line Items] | ||
Shares Issued (in shares) | 1,263,727 | |
Gross Proceeds | $ 12,582 | |
Shares issued through primary public offering | ||
Class of Stock [Line Items] | ||
Shares Issued (in shares) | 62,485,461 | |
Gross Proceeds | $ 622,077 | |
Shares issued through primary public offering | Common Stock | Advisor | ||
Class of Stock [Line Items] | ||
Shares issued to the Advisor (in shares) | 276,056 | |
Shares issued through stock distributions | ||
Class of Stock [Line Items] | ||
Shares Issued (in shares) | 2,132,266 | |
Gross Proceeds | $ 0 | |
Shares issued through distribution reinvestment plan | ||
Class of Stock [Line Items] | ||
Shares Issued (in shares) | 7,777,113 | |
Gross Proceeds, distribution reinvestment plan | $ 77,300 | |
Advisor | ||
Class of Stock [Line Items] | ||
Shares Issued (in shares) | 15,500 | |
Shares converted (in shares) | 4,500 | |
Gross Proceeds | $ 155 |
EQUITY - Convertible Stock (Det
EQUITY - Convertible Stock (Details) | 6 Months Ended | |
Jun. 30, 2016Event$ / sharesshares | Dec. 31, 2015$ / 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 | 6 Months Ended |
Jun. 30, 2016shares | Jun. 30, 2016shares | |
Equity [Abstract] | ||
Common share redemptions (in shares) | 1,116,740 | 1,462,083 |
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) - USD ($) $ / shares in Units, $ in Thousands | Jun. 30, 2016 | Jun. 03, 2016 | Apr. 29, 2016 | Mar. 31, 2016 | Feb. 29, 2016 | Jan. 29, 2016 | Jun. 30, 2016 | Dec. 31, 2015 |
Securities Financing Transaction [Line Items] | ||||||||
Total Aggregate Distribution | $ 21,512 | |||||||
Aggregate Cash Distribution | 7,105 | |||||||
Distributions Invested in Shares of Common Stock | $ 14,407 | $ 51,900 | ||||||
Per Common Share (in dollars per share) | $ 0.3 | |||||||
Record date of January 28, 2016 | ||||||||
Securities Financing Transaction [Line Items] | ||||||||
Total Aggregate Distribution | $ 3,574 | |||||||
Aggregate Cash Distribution | 1,151 | |||||||
Distributions Invested in Shares of Common Stock | $ 2,423 | |||||||
Per Common Share (in dollars per share) | $ 0.05 | |||||||
Record date of February 26, 2016 | ||||||||
Securities Financing Transaction [Line Items] | ||||||||
Total Aggregate Distribution | $ 3,585 | |||||||
Aggregate Cash Distribution | 1,167 | |||||||
Distributions Invested in Shares of Common Stock | $ 2,418 | |||||||
Per Common Share (in dollars per share) | $ 0.05 | |||||||
Record date of March 30, 2016 | ||||||||
Securities Financing Transaction [Line Items] | ||||||||
Total Aggregate Distribution | $ 3,587 | |||||||
Aggregate Cash Distribution | 1,172 | |||||||
Distributions Invested in Shares of Common Stock | $ 2,415 | |||||||
Per Common Share (in dollars per share) | $ 0.05 | |||||||
Record date of April 28, 2016 | ||||||||
Securities Financing Transaction [Line Items] | ||||||||
Total Aggregate Distribution | $ 3,595 | |||||||
Aggregate Cash Distribution | 1,181 | |||||||
Distributions Invested in Shares of Common Stock | $ 2,414 | |||||||
Per Common Share (in dollars per share) | $ 0.050 | |||||||
Record date of May 27, 2016 | ||||||||
Securities Financing Transaction [Line Items] | ||||||||
Total Aggregate Distribution | $ 3,606 | |||||||
Aggregate Cash Distribution | 1,226 | |||||||
Distributions Invested in Shares of Common Stock | $ 2,380 | |||||||
Per Common Share (in dollars per share) | $ 0.050 | |||||||
Record date of June 29, 2016 | ||||||||
Securities Financing Transaction [Line Items] | ||||||||
Total Aggregate Distribution | $ 3,565 | |||||||
Aggregate Cash Distribution | 1,208 | |||||||
Distributions Invested in Shares of Common Stock | $ 2,357 | |||||||
Per Common Share (in dollars per share) | $ 0.050 |
FAIR VALUE MEASURES AND DISCL68
FAIR VALUE MEASURES AND DISCLOSURES - Assets Measured at Fair Value on a Recurring Basis (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Interest rate caps | $ 5 | $ 32 |
Assets, fair value | 5 | 32 |
Level 1 | ||
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 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Interest rate caps | 5 | 32 |
Assets, fair value | 5 | 32 |
Level 3 | ||
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 DISCL69
FAIR VALUE MEASURES AND DISCLOSURES - Schedule of Carrying and Fair Values (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Carrying Amount | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Loan held for investment, net | $ 764 | $ 757 |
Preferred equity investment | 0 | 3,886 |
Mortgage notes payable- outstanding borrowings | (541,561) | (595,384) |
Mortgage note payable- included in other liabilities associated with rental properties held for sale | 0 | (16,443) |
Credit facility | (5,394) | (21,894) |
Estimated Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Loan held for investment, net | 1,151 | 1,151 |
Preferred equity investment | 0 | 3,908 |
Mortgage notes payable- outstanding borrowings | (535,783) | (573,693) |
Mortgage note payable- included in other liabilities associated with rental properties held for sale | 0 | (16,597) |
Credit facility | $ (5,394) | $ (21,894) |
DERIVATIVES AND HEDGING ACTIV70
DERIVATIVES AND HEDGING ACTIVITIES (Details) | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2016USD ($)derivative | Jun. 30, 2016USD ($)derivative | Dec. 31, 2015USD ($) | |
Interest Rate Caps | |||
Derivatives, Fair Value [Line Items] | |||
Asset Derivatives, Fair Value | $ 5,000 | $ 5,000 | $ 32,000 |
Cash flow hedges | The Ivy at Clear Creek | |||
Derivatives, Fair Value [Line Items] | |||
Loss due to hedge ineffectiveness | $ 72,388 | $ 72,388 | |
Cash flow hedges | Interest Rate Caps | |||
Derivatives, Fair Value [Line Items] | |||
Number of Instruments (over three years, in derivatives) | derivative | 8 | 8 | |
Notional Amount | $ 119,863,000 | $ 119,863,000 |
OPERATING EXPENSE LIMITATION WA
OPERATING EXPENSE LIMITATION WAIVER (Details) | 6 Months Ended |
Jun. 30, 2016 | |
OPERATING EXPENSE LIMITATION WAIVER [Abstract] | |
Percent of average invested assets | 2.00% |
Net income of operating expense, percent | 25.00% |
Operating expense limitation, term | 1 year |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - USD ($) $ / shares in Units, $ in Millions | Jul. 21, 2016 | Jul. 08, 2016 | Jun. 30, 2016 |
The Nesbit Palisades | |||
Subsequent Event [Line Items] | |||
Contract Sales Price | $ 26.6 | ||
Subsequent event | |||
Subsequent Event [Line Items] | |||
Dividends declared (in dollars per share) | $ 0.05 | ||
Subsequent event | The Nesbit Palisades | Alpharetta, Georgia | |||
Subsequent Event [Line Items] | |||
Contract Sales Price | $ 45.5 |