Cover Page
Cover Page - shares | 3 Months Ended | |
Mar. 31, 2021 | May 10, 2021 | |
Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 000-55187 | |
Entity Registrant Name | CIM INCOME NAV, INC. | |
Entity Incorporation, State or Country Code | MD | |
Entity Tax Identification Number | 27-3147801 | |
Entity Address, Address Line One | 2398 East Camelback Road, 4th Floor | |
Entity Address, City or Town | Phoenix, | |
Entity Address, State or Province | AZ | |
Entity Address, Postal Zip Code | 85016 | |
City Area Code | (602) | |
Local Phone Number | 778-8700 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Central Index Key | 0001498542 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --12-31 | |
Document Period End Date | Mar. 31, 2021 | |
D Shares | ||
Entity Information | ||
Entity Common Stock, Shares Outstanding | 15,100,000 | |
T Shares | ||
Entity Information | ||
Entity Common Stock, Shares Outstanding | 13,700,000 | |
S Shares | ||
Entity Information | ||
Entity Common Stock, Shares Outstanding | 7,600 | |
I Shares | ||
Entity Information | ||
Entity Common Stock, Shares Outstanding | 1,100,000 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Real estate assets: | ||
Land | $ 139,644 | $ 139,644 |
Buildings and improvements | 632,325 | 632,190 |
Intangible lease assets | 106,815 | 106,739 |
Total real estate assets, at cost | 878,784 | 878,573 |
Less: accumulated depreciation and amortization | (109,078) | (101,991) |
Total real estate assets, net | 769,706 | 776,582 |
Investment in CIM UII Onshore, net | 47,640 | 46,680 |
Investment in marketable securities | 15,062 | 15,496 |
Total real estate assets, equity investments and marketable securities, net | 832,408 | 838,758 |
Cash and cash equivalents | 8,094 | 8,805 |
Restricted cash | 405 | 415 |
Rents and tenant receivables, net | 16,123 | 15,952 |
Prepaid expenses and other assets | 1,154 | 984 |
Deferred costs, net | 190 | 289 |
Due from affiliates | 0 | 7 |
Asset held for sale | 0 | 1,009 |
Total assets | 858,374 | 866,219 |
LIABILITIES AND EQUITY | ||
Credit facility and notes payable, net | 454,538 | 449,378 |
Accrued expenses and accounts payable | 4,151 | 4,518 |
Due to affiliates | 13,577 | 13,826 |
Intangible lease liabilities, net | 11,716 | 12,040 |
Distributions and redemptions payable | 4,280 | 6,969 |
Derivative liabilities, deferred rental income and other liabilities | 8,848 | 11,174 |
Total liabilities | 497,110 | 497,905 |
Commitments and contingencies | ||
Redeemable common stock | 9,631 | 10,040 |
STOCKHOLDERS’ EQUITY | ||
Preferred stock, $0.01 par value per share; 10,000,000 shares authorized, none issued and outstanding | 0 | 0 |
Capital in excess of par value | 489,127 | 493,417 |
Accumulated distributions in excess of earnings | (131,885) | (128,383) |
Accumulated other comprehensive loss | (6,608) | (7,768) |
Total stockholders’ equity | 350,932 | 357,567 |
Non-controlling interests | 701 | 707 |
Total equity | 351,633 | 358,274 |
Total liabilities, redeemable common stock, and equity | 858,374 | 866,219 |
D Shares | ||
STOCKHOLDERS’ EQUITY | ||
Common stock | 151 | 153 |
T Shares | ||
STOCKHOLDERS’ EQUITY | ||
Common stock | 137 | 138 |
S Shares | ||
STOCKHOLDERS’ EQUITY | ||
Common stock | 0 | 0 |
I Shares | ||
STOCKHOLDERS’ EQUITY | ||
Common stock | $ 10 | $ 10 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2021 | Dec. 31, 2020 |
Preferred stock, par or stated value per share (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
D Shares | ||
Common stock, par or stated value per share (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 122,500,000 | 122,500,000 |
Common stock, shares, issued (in shares) | 15,104,085 | 15,318,506 |
Common stock, shares, outstanding (in shares) | 15,104,085 | 15,318,506 |
T Shares | ||
Common stock, par or stated value per share (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 122,500,000 | 122,500,000 |
Common stock, shares, issued (in shares) | 13,681,444 | 13,778,134 |
Common stock, shares, outstanding (in shares) | 13,681,444 | 13,778,134 |
S Shares | ||
Common stock, par or stated value per share (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 122,500,000 | 122,500,000 |
Common stock, shares, issued (in shares) | 7,540 | 7,399 |
Common stock, shares, outstanding (in shares) | 7,540 | 7,399 |
I Shares | ||
Common stock, par or stated value per share (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 122,500,000 | 122,500,000 |
Common stock, shares, issued (in shares) | 1,045,286 | 1,011,342 |
Common stock, shares, outstanding (in shares) | 1,045,286 | 1,011,342 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Revenues: | ||
Rental and other property income | $ 18,698,000 | $ 18,588,000 |
Interest income on marketable securities | 79,000 | 90,000 |
Total revenues | 18,777,000 | 18,678,000 |
Operating expenses: | ||
General and administrative | 1,386,000 | 1,185,000 |
Property operating | 966,000 | 1,454,000 |
Real estate tax | 1,319,000 | 1,333,000 |
Advisory fees and expenses | 1,497,000 | 1,740,000 |
Transaction-related | 212,000 | 91,000 |
Depreciation and amortization | 6,803,000 | 7,039,000 |
Real estate impairment | 0 | 5,686,000 |
Total operating expenses | 12,183,000 | 18,528,000 |
Gain on disposition of real estate, net | 10,000 | 0 |
Operating income | 6,604,000 | 150,000 |
Other expense: | ||
Gain on investment in CIM UII Onshore | 1,332,000 | 0 |
Interest expense and other, net | (4,409,000) | (3,660,000) |
Net income (loss) | 3,527,000 | (3,510,000) |
Net income allocated to noncontrolling interest | 9,000 | 4,000 |
Net income (loss) attributable to the Company | 3,518,000 | (3,514,000) |
D Shares | ||
Other expense: | ||
Net income (loss) attributable to the Company | $ 1,826,000 | $ (1,825,000) |
Basic and diluted weighted average number of common shares outstanding (in shares) | 15,269,757 | 17,634,578 |
Basic and diluted net income (loss) per common share (in dollars per share) | $ 0.12 | $ (0.10) |
T Shares | ||
Other expense: | ||
Net income (loss) attributable to the Company | $ 1,562,000 | $ (1,583,000) |
Basic and diluted weighted average number of common shares outstanding (in shares) | 13,782,825 | 14,525,139 |
Basic and diluted net income (loss) per common share (in dollars per share) | $ 0.11 | $ (0.11) |
S Shares | ||
Other expense: | ||
Net income (loss) attributable to the Company | $ 2,000 | $ (1,000) |
Basic and diluted weighted average number of common shares outstanding (in shares) | 7,503 | 7,094 |
Basic and diluted net income (loss) per common share (in dollars per share) | $ 0.15 | $ (0.07) |
I Shares | ||
Other expense: | ||
Net income (loss) attributable to the Company | $ 128,000 | $ (105,000) |
Basic and diluted weighted average number of common shares outstanding (in shares) | 1,035,117 | 1,057,418 |
Basic and diluted net income (loss) per common share (in dollars per share) | $ 0.12 | $ (0.10) |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Statement of Comprehensive Income [Abstract] | ||
Net income (loss) | $ 3,527 | $ (3,510) |
Other comprehensive income (loss) | ||
Unrealized holding (loss) gain on marketable securities | (368) | 151 |
Reclassification adjustment for realized loss (gain) included in income as other expense | 15 | (2) |
Unrealized gain (loss) on interest rate swaps | 38 | (7,584) |
Amount of loss reclassified from other comprehensive income (loss) into income as interest expense and other, net | 1,475 | 388 |
Total other comprehensive income (loss) | 1,160 | (7,047) |
Comprehensive income (loss) | 4,687 | (10,557) |
Comprehensive income allocated to noncontrolling interest | 9 | 4 |
Comprehensive income (loss) attributable to the Company | $ 4,678 | $ (10,561) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) $ in Thousands | Total | Common Stock | Capital in Excess of Par Value | Accumulated Distributions in Excess of Earnings | Accumulated Other Comprehensive (Loss) Income | Total Stockholders’ Equity | Non- Controlling Interests |
Beginning Balance (in shares) at Dec. 31, 2019 | 33,747,710 | ||||||
Beginning Balance at Dec. 31, 2019 | $ 416,766 | $ 337 | $ 507,913 | $ (87,513) | $ (4,710) | $ 416,027 | $ 739 |
Increase (Decrease) in Stockholders' Equity | |||||||
Issuance of common stock (in shares) | 1,131,064 | ||||||
Issuance of common stock | 20,135 | $ 11 | 20,124 | 20,135 | |||
Distributions declared on common stock | (8,096) | (8,096) | (8,096) | ||||
Commissions, dealer manager and ongoing stockholder servicing fees | (415) | (415) | (415) | ||||
Other offering costs | (149) | (149) | (149) | ||||
Redemptions of common stock (in shares) | (2,653,586) | ||||||
Redemptions of common stock | (46,684) | $ (26) | (46,658) | (46,684) | |||
Equity-based compensation | 33 | 33 | 33 | ||||
Changes in redeemable common stock | 2,650 | 2,650 | 2,650 | ||||
Distributions to non-controlling interests | (14) | (14) | |||||
Comprehensive income | (10,557) | (3,514) | (7,047) | (10,561) | 4 | ||
Ending Balance (in shares) at Mar. 31, 2020 | 32,225,188 | ||||||
Ending Balance at Mar. 31, 2020 | 373,669 | $ 322 | 483,498 | (99,123) | (11,757) | 372,940 | 729 |
Beginning Balance (in shares) at Dec. 31, 2020 | 30,115,381 | ||||||
Beginning Balance at Dec. 31, 2020 | 358,274 | $ 301 | 493,417 | (128,383) | (7,768) | 357,567 | 707 |
Increase (Decrease) in Stockholders' Equity | |||||||
Issuance of common stock (in shares) | 290,253 | ||||||
Issuance of common stock | 4,835 | $ 3 | 4,832 | 4,835 | |||
Distributions declared on common stock | (7,020) | (7,020) | (7,020) | ||||
Commissions, dealer manager and ongoing stockholder servicing fees | (159) | (159) | (159) | ||||
Other offering costs | (36) | (36) | (36) | ||||
Redemptions of common stock (in shares) | (602,977) | ||||||
Redemptions of common stock | (9,985) | $ (6) | (9,979) | (9,985) | |||
Equity-based compensation (in shares) | 2,923 | ||||||
Equity-based compensation | 82 | $ 0 | 82 | 82 | |||
Equity-based payments to advisor (in shares) | 32,775 | ||||||
Equity-based payments to advisor | 561 | $ 0 | 561 | 561 | |||
Changes in redeemable common stock | 409 | 409 | 409 | ||||
Distributions to non-controlling interests | (15) | (15) | |||||
Comprehensive income | 4,687 | 3,518 | 1,160 | 4,678 | 9 | ||
Ending Balance (in shares) at Mar. 31, 2021 | 29,838,355 | ||||||
Ending Balance at Mar. 31, 2021 | $ 351,633 | $ 298 | $ 489,127 | $ (131,885) | $ (6,608) | $ 350,932 | $ 701 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Parenthetical) - $ / shares | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Statement of Stockholders' Equity [Abstract] | ||
Distributions declared on common stock (in dollars per share) | $ 0.23 | $ 0.24 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Cash flows from operating activities: | ||
Net income (loss) | $ 3,527,000 | $ (3,510,000) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Depreciation and amortization, net | 6,763,000 | 6,975,000 |
Straight-line rental income | (662,000) | (1,275,000) |
(Recovery) write-off of uncollectible lease-related receivables | (182,000) | 158,000 |
Amortization of deferred financing costs | 262,000 | 273,000 |
Amortization on marketable securities | 22,000 | 13,000 |
Equity-based compensation | 82,000 | 33,000 |
Equity-based payments to Advisor | 561,000 | 0 |
Loss (gain) on sale of marketable securities | 15,000 | (2,000) |
Gain on investment in CIM UII Onshore | (1,332,000) | 0 |
Gain on disposition of real estate, net | (10,000) | 0 |
Impairment of real estate assets | 0 | 5,686,000 |
Changes in assets and liabilities: | ||
Rents and tenant receivables, net | 673,000 | 586,000 |
Prepaid expenses and other assets | (170,000) | (422,000) |
Accrued expenses and accounts payable | (367,000) | 830,000 |
Deferred rental income and other liabilities | (813,000) | 278,000 |
Due from affiliates | 7,000 | (151,000) |
Due to affiliates | 208,000 | (978,000) |
Net cash provided by operating activities | 8,584,000 | 8,494,000 |
Cash flows from investing activities: | ||
Investment in real estate assets and capital expenditures | (211,000) | (38,000) |
Investment in marketable securities | (2,954,000) | (981,000) |
Proceeds from sale and maturities of marketable securities | 2,998,000 | 587,000 |
Investment in CIM UII Onshore | 0 | (50,000,000) |
Distributions of capital from investment in CIM UII Onshore | 372,000 | 0 |
Net proceeds from disposition of real estate assets | 1,019,000 | 4,789,000 |
Proceeds from the settlement of insurance claims | 0 | 135,000 |
Net cash provided by (used in) investing activities | 1,224,000 | (45,508,000) |
Cash flows from financing activities: | ||
Proceeds from issuance of common stock | 561,000 | 16,124,000 |
Offering costs on issuance of common stock | (652,000) | (1,174,000) |
Redemptions of common stock | (10,115,000) | (46,684,000) |
Distributions to stockholders | (5,305,000) | (4,181,000) |
Proceeds from credit facility | 5,000,000 | 70,000,000 |
Deferred financing costs paid | (3,000) | 0 |
Change in escrowed stockholder proceeds liability | 0 | (50,000) |
Distributions to noncontrolling interests | (15,000) | (14,000) |
Net cash (used in) provided by financing activities | (10,529,000) | 34,021,000 |
Net decrease in cash and cash equivalents and restricted cash | (721,000) | (2,993,000) |
Cash and cash equivalents and restricted cash, beginning of period | 9,220,000 | 5,718,000 |
Cash and cash equivalents and restricted cash, end of period | 8,499,000 | 2,725,000 |
Reconciliation of cash and cash equivalents and restricted cash to the condensed consolidated balance sheets: | ||
Total cash and cash equivalents and restricted cash | $ 8,499,000 | $ 2,725,000 |
ORGANIZATION AND BUSINESS
ORGANIZATION AND BUSINESS | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND BUSINESS | ORGANIZATION AND BUSINESS CIM Income NAV, Inc. (the “Company”) is a monthly priced perpetual life non-exchange traded real estate investment trust (“REIT”) formed as a Maryland corporation on July 27, 2010 that qualified as a REIT for U.S. federal income tax purposes beginning with its taxable year ended December 31, 2012. Substantially all of the Company’s business is conducted through CIM Income NAV Operating Partnership, LP, a Delaware limited partnership (“CIM Income NAV OP”), of which the Company is the sole general partner, and owns, directly or indirectly, 100% of the partnership interests. The Company is externally managed by CIM Income NAV Management, LLC, a Delaware limited liability company (“CIM Income NAV Management”), which is an affiliate of CIM Group, LLC (“CIM”). CIM is a community-focused real estate and infrastructure owner, operator, lender and developer. Headquartered in Los Angeles, California, CIM has offices across the United States and in Tokyo, Japan. CCO Group, LLC owns and controls CIM Income NAV Management, the Company’s advisor, and is the indirect owner of CCO Capital, LLC (“CCO Capital”), the Company’s dealer manager, and CREI Advisors, LLC (“CREI Advisors”), the Company’s property manager. CCO Group, LLC and its subsidiaries (collectively, “CCO Group”) serve as the Company’s sponsor and as a sponsor to CIM Real Estate Finance Trust, Inc. (“CMFT”). On December 6, 2011, the Company commenced its initial public offering (the “Initial Offering”) on a “best efforts” basis of $4.0 billion in shares of common stock, consisting of $3.5 billion in shares in the primary offering (the “Primary Offering”) and $500.0 million in shares pursuant to a distribution reinvestment plan (the “DRIP”). On August 26, 2013, the Company commenced its first follow-on offering (the “First Follow-on Offering”), pursuant to which the Company offered up to $4.0 billion in shares of common stock, consisting of $3.5 billion in shares in the Primary Offering and $500.0 million in shares pursuant to the DRIP. On February 10, 2017, the Company commenced its second follow-on offering (the “Second Follow-on Offering”), pursuant to which the Company offered up to $4.0 billion in shares of common stock, consisting of $3.5 billion in shares in the Primary Offering and $500.0 million in shares pursuant to the DRIP. On August 7, 2020, the Company commenced its third follow-on offering, pursuant to which the Company is offering up to $4.0 billion in shares of common stock (the “Third Follow-on Offering” and collectively with the Initial Offering, the First Follow-on Offering and the Second Follow-on offering, the “Offering”), consisting of $3.5 billion in shares in the Primary Offering and $500.0 million in shares pursuant to the DRIP. As part of the First Follow-on Offering, the Company designated the existing shares of the Company’s common stock that were sold prior to such date to be Wrap Class shares (“W Shares”) of common stock and registered two new classes of the Company’s common stock, Advisor Class shares (“A Shares”) and Institutional Class shares (“I Shares”). On November 27, 2018, the Company amended its charter to, among other things, change the name and designation of its W Shares to Class D Common Stock (the “D Shares”), and its A Shares to Class T Common Stock (the “T Shares”), respectively, and reclassified a portion of its common stock as Class S Common Stock (the “S Shares”), to be offered alongside its D Shares, T Shares and I Shares in the Offering (the “Share Modifications”). The Company is offering to sell any combination of D Shares, T Shares, S Shares and I Shares with a dollar value up to the maximum offering amount. As of March 31, 2021, the Company had issued approximately 49.0 million shares of common stock in the Offering, including 4.0 million in shares issued in the DRIP, for gross offering proceeds of $883.0 million before $26.8 million in upfront selling commissions, dealer manager fees and the current portion of stockholder servicing fees and $6.5 million in organization and offering costs. Effective April 1, 2020, the Company modified its Offering and certain other features of the Company from a daily to a monthly NAV REIT. As part of the change from a daily to a monthly NAV REIT, the Company’s board of directors (the “Board”) approved, among other things: (1) a change in the frequency of the NAV calculations from daily to monthly and certain other related changes to the Company’s valuation policies, and (2) adopted an amended and restated share redemption program (the “Amended Share Redemption Program”) that provides for redemptions on a monthly basis. The per share purchase price for each class of common stock varies from month-to-month and, each month, is generally equal to, for each class of common stock, the Company’s net asset value (“NAV”) for such class, divided by the number of shares of that class outstanding, as of the prior month, plus, for T Shares and S Shares sold in the Primary Offering, applicable upfront selling commissions and dealer manager fees. The Company’s NAV per share is calculated monthly as of the last calendar day of each month by an independent fund accountant using a process that incorporates (1) the periodic valuations of each of the Company’s real estate assets and related liabilities by the Company’s independent valuation expert, (2) ongoing assessment by the valuation expert of the estimated impact of any events that require adjustment to the most recent valuations determined by the valuation expert, (3) updates in the price of liquid assets for which third-party market quotes are available, (4) valuations of any securities or other assets for which market quotes are not available, (5) valuation of the Company’s other assets and liabilities, (6) accruals of the Company’s distributions for each share class, and (7) estimates of monthly accruals, on a net basis, of operating r evenues, expenses, debt service costs and fees. As of March 31, 2021, the NAV per share for D Shares, T Shares, S Shares and I Sh ares was $16.35, $15.91, $15.89 and $16.65, respectively. The Company’s NAV is not audited or reviewed by its independent registered public accounting firm. The Company has used substantially all of the net proceeds from the Offering to acquire and operate a diversified portfolio primarily consisting of retail, office and industrial properties that are leased to creditworthy t enants under long-term net leases, and are strategically located throughout the United States. As of March 31, 2021, the Company owned 122 commercial properties, including two properties owned through a consolidated joint venture arrangement (the “Consolidated Joint Venture”), comprised of 5.3 million rentable square feet of commercial space located in 33 states, and which was 98.7% leased, including month-to-month agreements, if any. As of March 31, 2021, the Company also owned limited partnership interests with CIM UII Onshore, L.P. (“CIM UII Onshore”), the sole purpose of which is to invest all of its assets in CIM Urban Income Investments, L.P. (“CIM Urban Income”), which is a private institutional fund that acquires, owns and operates substantially stabilized, diversified real estate and real estate-related assets in urban markets primarily located throughout North America. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The summary of significant accounting policies presented below is designed to assist in understanding the Company’s condensed consolidated financial statements. These accounting policies conform to accounting principles generally accepted in the United States of America (“GAAP”) in all material respects, and have been consistently applied in preparing the accompanying condensed consolidated financial statements. Principles of Consolidation and Basis of Presentation The condensed consolidated financial statements of the Company have been prepared in accordance with the rules and regulations of the U.S. Securities and Exchange Commission regarding interim financial reporting, including the instructions to Form 10-Q and Article 10 of Regulation S-X, and do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, the statements for the interim periods presented include all adjustments, which are of a normal and recurring nature, necessary for a fair presentation of the results for such periods. Results for these interim periods are not necessarily indicative of full year results. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the Company’s audited consolidated financial statements as of and for the year ended December 31, 2020, and related notes thereto set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020. The condensed consolidated financial statements should also be read in conjunction with Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in this Quarterly Report on Form 10-Q. The condensed consolidated financial statements include the accounts of the Company, its wholly-owned subsidiaries and the Consolidated Joint Venture in which the Company has a controlling financial interest. All intercompany balances and transactions have been eliminated in consolidation. The Company evaluates its relationships and investments to determine if it has variable interests. A variable interest is an investment or other interest that will absorb portions of an entity’s expected losses or receive portions of the entity’s expected residual returns. If the Company determines that it has a variable interest in an entity, it evaluates whether such interest is in a variable interest entity (“VIE”). VIEs are entities where investors lack sufficient equity at risk for the entity to finance its activities without additional subordinated financial support or where equity investors, as a group, lack one of the following characteristics: (a) the power to direct the activities that most significantly impact the entity’s economic performance, (b) the obligation to absorb the expected losses of the entity, or (c) the right to receive the expected returns of the entity. The Company consolidates any VIEs when it is determined to be the primary beneficiary of the VIE’s operations. For legal entities being evaluated for consolidation, the Company must first determine whether the interests that it holds and fees it receives qualify as variable interests in the entity. A variable interest is an investment or other interest that will absorb portions of an entity’s expected losses or receive portions of the entity’s expected residual returns. The Company’s evaluation includes consideration of fees paid to the Company where the Company acts as a decision maker or service provider to the entity being evaluated. If the Company determines that it holds a variable interest in an entity, it evaluates whether that entity is a VIE. A VIE must be consolidated by its primary beneficiary, which is generally defined as the party who has a controlling financial interest in the VIE. The Company qualitatively assesses whether it is (or is not) the primary beneficiary of a VIE. Consideration of various factors include, but are not limited to, the Company’s ability to direct the activities that most significantly impact the entity’s economic performance and its obligation to absorb losses from or right to receive benefits of the VIE that could potentially be significant to the VIE. The Company consolidates any VIEs when the Company is determined to be the primary beneficiary of the VIE, and the difference between consolidating the VIE and accounting for it using the equity method could be material to the Company’s condensed consolidated financial statements. The Company continually evaluates the need to consolidate any VIEs based on standards set forth in GAAP as described above. As of March 31, 2021 and December 31, 2020 , the Company determined that it had a controlling interest in the Consolidated Joint Venture and therefore met the requirements for consolidation. Reclassifications The Company is separately presenting the write-off of uncollectible lease-related receivables of $158,000 for the three months ended March 31, 2020, which was previously included in straight-line rental income, net in the condensed consolidated statements of cash flows. This reclassification had no effect on previously reported totals or subtotals. Use of Estimates The preparation of 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 condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Real Estate Assets Real estate assets are stated at cost, less accumulated depreciation and amortization. The Company considers the period of future benefit of each respective asset to determine the appropriate useful life. The estimated useful lives of the Company’s real estate assets by class are generally as follows: Buildings 40 years Site improvements 15 years Tenant improvements Lesser of useful life or lease term Intangible lease assets Lease term Recoverability of Real Estate Assets The Company continually monitors events and changes in circumstances that could indicate that the carrying amounts of its real estate assets may not be recoverable. Impairment indicators that the Company considers include, but are not limited to: bankruptcy or other credit concerns of a property’s major tenant, such as a history of late payments, lease concessions and other factors; a significant decrease in a property’s revenues due to lease terminations; vacancies; co-tenancy clauses; reduced lease rates; changes in anticipated holding periods; or other circumstances. When indicators of potential impairment are present, the Company assesses the recoverability of the assets by determining whether the carrying amount of the assets will be recovered through the undiscounted future cash flows expected from the use of the assets and their eventual disposition. In the event that such expected undiscounted future cash flows do not exceed the carrying amount, the Company will adjust the real estate assets to their respective fair values and recognize an impairment loss. Generally, fair value is determined using a discounted cash flow analysis and recent comparable sales transactions. No impairment indicators were identified and no impairment losses were recorded during the three months ended March 31, 2021. The Company’s impairment assessment as of March 31, 2021 was based on the most current information available to the Company, including expected holding periods. If the Company’s expected holding periods for assets change, subsequent tests for impairment could result in additional impairment charges in the future. The Company cannot provide any assurance that additional material impairment charges with respect to the Company’s real estate assets will not occur during 2021 or in future periods. The assumptions and uncertainties utilized in the evaluation of the impairment of real estate assets are discussed in detail in Note 3 — Fair Value Measurements. See also Note 4 — Real Estate Assets for further discussion regarding real estate acquisition and disposition activity. During the three months ended March 31, 2020, the Company recorded impairment charges of $5.7 million related to one anchored shopping center due to the carrying value being greater than the estimated fair value of the property, net of selling costs, and one retail property due to tenant bankruptcy. Assets Held for Sale When a real estate asset is identified by the Company as held for sale, the Company will cease recording depreciation and amortization of the assets related to the property and estimate its fair value, net of selling costs. If, in management’s opinion, the fair value, net of selling costs, of the asset is less than the carrying amount of the asset, an adjustment to the carrying amount is then recorded to reflect the estimated fair value of the property, net of selling costs. As of March 31, 2021 there were no properties identified as held for sale. As of December 31, 2020, the Company identified one property with a fair value of $1.0 million as held for sale. Disposition of Real Estate Assets Gains and losses from dispositions are recognized once the various criteria relating to the terms of sale and any subsequent involvement by the Company with the asset sold are met. A discontinued operation includes only the disposal of a component of an entity and represents a strategic shift that has (or will have) a major effect on an entity’s financial results. The Company’s property dispositions during the three months ended March 31, 2021 and 2020 did not qualify for discontinued operations presentation, and thus, the results of the properties that have been sold remain in operating income, and any associated gains or losses from the disposition are included in gain on disposition of real estate, net . Allocation of Purchase Price of Real Estate Assets Upon the acquisition of real properties, the Company allocates the purchase price to acquired tangible assets, consisting of land, buildings and improvements, and to identified intangible assets and liabilities, consisting of the value of above- and below-market leases and the value of in-place leases and other intangibles, based in each case on their respective fair values. The Company utilizes independent appraisals to assist in the determination of the fair values of the tangible assets of an acquired property (which includes land and buildings). The information in the appraisal, along with any additional information available to the Company’s management, is used in estimating the amount of the purchase price that is allocated to land. Other information in the appraisal, such as building value and market rents, may be used by the Company’s management in estimating the allocation of purchase price to the building and to intangible lease assets and liabilities. The appraisal firm has no involvement in management’s allocation decisions other than providing this market information. The determination of the fair values of the real estate assets and liabilities acquired requires the use of significant assumptions with regard to the current market rental rates, rental growth rates, capitalization and discount rates, interest rates and other variables. The use of alternative estimates may result in a different allocation of the Company’s purchase price, which could materially impact the Company’s results of operations. All real estate acquisitions during the periods presented qualified as asset acquisitions and, as such, acquisition-related fees and certain acquisition-related expenses related to these asset acquisitions are capitalized and allocated to tangible and intangible assets and liabilities, as described above. Investment in Marketable Securities Investment in marketable securities consists primarily of the Company’s investment in corporate and government debt securities. The Company determines the appropriate classification for debt securities at the time of purchase and reevaluates such designation as of each balance sheet date. As of March 31, 2021, the Company classified its investments as available-for-sale as the Company is not actively trading the securities; however, the Company may sell them prior to their maturity. These investments are carried at their estimated fair value with unrealized gains and losses reported in other comprehensive income (loss) . The Company monitors its available-for-sale securities for impairments. A loss is recognized when the Company determines that a decline in the estimated fair value of a security below its amortized cost has resulted from a credit loss or other factors. The Company records impairments related to credit losses through an allowance for credit losses. However, the allowance is limited by the amount that the fair value is less than the amortized cost basis. The Company considers many factors in determining whether a credit loss exists, including, but not limited to, the extent to which the fair value is less than the amortized cost basis, recent events specific to the security, industry or geographic area, the payment structure of the security, the failure of the issuer of the security to make scheduled interest or principal payments, and external credit ratings and recent changes in such ratings. The analysis of determining whether a credit loss exists requires significant judgments and assumptions. The use of alternative judgments and assumptions could result in a different conclusion. The amortized cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity computed under the effective interest method and is recorded in the accompanying condensed consolidated statements of operations in interest and other expense, net. Upon the sale of a security, the realized net gain or loss is computed on the specific identification method. Investment in CIM UII Onshore As of March 31, 2021, the Company had invested capital of $49.0 million in CIM UII Onshore with a carrying value of $47.6 million, which represents less than 5% ownership of CIM UII Onshore. The Company accounts for its investment under the equity method. The equity method of accounting requires the investment to be initially recorded at cost, including transaction costs incurred to finalize the investment, and subsequently adjusted for the Company’s share of equity in CIM UII Onshore’s earnings and distributions. The Company records its share of CIM UII Onshore’s profits or losses on a quarterly basis as an adjustment to the carrying value of the investment on the Company’s condensed consolidated balance sheet and is recognized as a profit or loss on the condensed consolidated statements of operations. The Company recorded its share of gain totaling $1.3 million during the three months ended March 31, 2021 in the condensed consolidated statements of operations. During the three months ended March 31, 2021, the Company received $372,000 in dividends, which reduced the invested capital and the carrying amount of the Company’s investment as the dividends are not recognized as dividend income. Noncontrolling Interest in Consolidated Joint Venture The Company has a controlling interest in a Consolidated Joint Venture and, therefore, meets the requirements for consolidation. The Company recorded net income of $9,000 and paid distributions of $15,000 to the noncontrolling interest during the three months ended March 31, 2021. The Company recorded the noncontrolling interest of $701,000 and $707,000 as of March 31, 2021 and December 31, 2020, re spectively, on the condensed consolidated balance sheets. Restricted Cash The Company had $405,000 and $415,000 in restricted cash as of March 31, 2021 and December 31, 2020, respectively. Included in restricted cash was $123,000 and $134,000 held by lenders in lockbox accounts as of March 31, 2021 and December 31, 2020, respectively. As part of certain debt agreements, rent from certain of the Company’s tenants is deposited directly into a lockbox account, from which funds in excess of the required minimum balance are disbursed on a weekly basis to the Company. Restricted cash also included $282,000 and $281,000 held in escrow for tenant improvements at a certain property in accordance with the associated lease agreement as of March 31, 2021 and December 31, 2020, respectively. Stockholder Servicing Fees The Company pays CCO Capital stockholder servicing fees, which are calculated on a daily basis in the amount of 1/365th of 0.25%, 0.85% and 0.85% of the NAV per share, for each class of common stock outstanding for D Shares, T Shares and S Shares, respectively. The Company does not pay a stockholder servicing fee with respect to I Shares. The stockholder servicing fees are paid monthly in arrears. An estimated liability for future stockholder servicing fees payable to CCO Capital is recognized at the time each share is sold and included in due to affiliates in the condensed consolidated balance sheets with a corresponding decrease to capital in excess of par value. The Company recognized a liability for future fees payable to CCO Capital of $11.4 million and $11.9 million as of March 31, 2021 and December 31, 2020, respectively. Leases The Company has lease agreements with lease and non-lease components. The Company has elected to not separate non-lease components from lease components for all classes of underlying assets (primarily real estate assets) and will account for the combined components as rental and other property income. Non-lease components included in rental and other property income include certain tenant reimbursements for maintenance services (including common-area maintenance services or “CAM”), real estate taxes, insurance and utilities paid for by the lessor but consumed by the lessee. As a lessor, the Company has further determined that this policy will be effective only on a lease that has been classified as an operating lease and the revenue recognition pattern and timing is the same for both types of components. The Company is not party to any material leases where it is the lessee. Significant judgments and assumptions are inherent in not only determining if a contract contains a lease, but also the lease classification, terms, payments, and, if needed, discount rates. Judgments include the nature of any options, including if they will be exercised, evaluation of implicit discount rates and the assessment and consideration of “fixed” payments for straight-line rent revenue calculations. Lease costs represent the initial direct costs incurred in the origination, negotiation and processing of a lease agreement. Such costs include outside broker commissions and other independent third-party costs and are amortized over the life of the lease on a straight-line basis. Costs related to salaries and benefits, supervision, administration, unsuccessful origination efforts and other activities not directly related to completed lease agreements are expensed as incurred. Upon successful lease execution, leasing commissions are capitalized. Revenue Recognition Rental and other property income is primarily derived from fixed contractual payments from operating leases, and therefore, is generally recognized on a straight-line basis over the term of the lease, which typically begins the date the tenant takes control of the space. When the Company acquires a property, the terms of existing leases are considered to commence as of the acquisition date for the purpose of this calculation. Variable rental and other property income consists primarily of tenant reimbursements for recoverable real estate taxes and operating expenses which are included in rental and other property income in the period when such costs are incurred, with offsetting expenses in real estate taxes and property operating expenses, respectively, within the condensed consolidated statements of operations. The Company defers the recognition of variable rental and other property income, such as percentage rents, until the specific target that triggers the contingent rental income is achieved. The Company continually reviews whether collection of lease-related receivables, including any straight-line rent, and current and future operating expense reimbursements from tenants are probable. The determination of whether collectability is probable takes into consideration the tenant’s payment history, the financial condition of the tenant, business conditions in the industry in which the tenant operates and economic conditions in the area in which the property is located. Upon the determination that the collectability of a receivable is not probable, the Company will record a reduction to rental and other property income for amounts previously recorded and a decrease in the outstanding receivable. Revenue from leases where collection is deemed to be not probable is recorded on a cash basis until collectability becomes probable. Management’s estimate of the collectability of lease-related receivables is based on the best information available at the time of estimate. The Company does not use a general reserve approach and lease-related receivables are adjusted and taken against rental and other property income only when collectability becomes not probable. As of March 31, 2021 and December 31, 2020, the Company had identified certain tenants where collection was no longer considered probable and decreased outstanding receivables by $992,000 and $1.2 million, respectively. Earnings (Loss) and Distributions Per Share The Company has four classes of common stock with nonforfeitable dividend rights that are determined based on a different NAV for each class. Accordingly, the Company utilizes the two-class method to determine its earnings per share, which can result in different earnings per share for each of the classes. Under the two-class method, earnings per share of each class of common stock are computed by dividing the sum of the distributed earnings to common stockholders and undistributed earnings allocated to common stockholders by the weighted average number of shares for each class of common stock for the respective period. Diluted income per share, when applicable, considers the effect of any potentially dilutive share equivalents, of which the Company had none for each of the three months ended March 31, 2021 or 2020. Distributions per share are calculated based on the authorized monthly distribution rate. Prior to April 1, 2020, distributions were calculated based on the authorized daily distribution rate. Recent Accounting Pronouncements From time to time, new accounting pronouncements are issued by various standard setting bodies that may have an impact on the Company’s accounting and reporting. Except as otherwise stated below, the Company is currently evaluating the effect that certain new accounting requirements may have on the Company’s accounting and related reporting and disclosures in the Company’s condensed consolidated financial statements. In January 2021, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2021-01, Reference Rate Reform (Topic 848) (“ASU 2021-01”). The amendments in ASU 2021-01 clarify that certain optional expedients and exceptions for contract modifications and hedge accounting apply to derivative instruments that use an interest rate for margining, discounting, or contract price alignment that is modified as a result of the discontinuation of the use of LIBOR as a benchmark interest rate due to reference rate reform. ASU 2021-01 is effective immediately for all entities with the option to apply retrospectively as of any date from the beginning of an interim period that includes or is subsequent to March 12, 2020, and can be applied prospectively to any new contract modifications made on or after January 7, 2021. The Company currently uses the London Interbank Offered Rate (the “LIBOR”) as its benchmark interest rate for its derivative instruments, and has not entered into any new contracts on or after the effective date of ASU 2021-01. The Company adopted this ASU during the first quarter of fiscal year 2021, and has concluded that there is no material impact on its condensed consolidated financial statements. In April 2020, the FASB issued a question and answer document (the “Lease Modification Q&A”) focused on the application of lease accounting guidance to lease concessions provided as a result of the COVID-19 pandemic. Due to the business disruptions and challenges severely affecting the global economy caused by the COVID-19 pandemic, many lessors may be required to provide rent deferrals and other lease concessions to lessees. While the lease modification guidance in ASC 842 addresses routine changes to lease terms resulting from negotiations between the lessee and the lessor, this guidance did not contemplate concessions being so rapidly executed to address the sudden liquidity constraints of some lessees arising from COVID-19 related impacts. Under existing lease guidance, the Company would have to determine, on a lease by lease basis, if a lease concession was the result of a new arrangement reached with the tenant (treated within the lease modification accounting framework) or if a lease concession was under the enforceable rights and obligations within the existing lease agreement (precluded from applying the lease modification accounting framework). The Lease Modification Q&A allows the Company, if certain criteria have been met, to bypass the lease by lease analysis, and instead elect to either apply the lease modification accounting framework or not, with such election applied consistently to leases with similar characteristics and similar circumstances. The Company has elected to apply this guidance to avoid performing a lease by lease analysis for the lease concessions that (1) were granted as relief due to COVID-19 related impacts and (2) result in the cash flows remaining substantially the same or less than the original contract and will account for these lease concessions as if no changes were made to the leases. During the three months ended March 31, 2021, the Company provided lease concessions in the form of rent abatements to certain tenants in response to the impact of the COVID-19 pandemic on those tenants. During the three months ending March 31, 2021, the Company granted rental abatements of $217,000. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS GAAP defines fair value, establishes a framework for measuring fair value and requires disclosures about fair value measurements. GAAP emphasizes that fair value is intended to be a market-based measurement, as opposed to a transaction-specific measurement. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions. Depending on the nature of the asset or liability, various techniques and assumptions can be used to estimate the fair value. Assets and liabilities are measured using inputs from three levels of the fair value hierarchy, as follows: Level 1 — Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. An active market is defined as a market in which transactions for the assets or liabilities occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2 — Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active (markets with few transactions), inputs other than quoted prices that are observable for the asset or liability (i.e., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data correlation or other means (market corroborated inputs). Level 3 — Unobservable inputs, which are only used to the extent that observable inputs are not available, reflect the Company’s assumptions about the pricing of an asset or liability. The following describes the methods the Company uses to estimate the fair value of the Company’s financial assets and liabilities: Credit facility and notes payable — The fair value is estimated by discounting the expected cash flows based on estimated borrowing rates available to the Company as of the measurement date. Current and prior period liabilities’ carrying and fair values exclude net deferred financing costs. These financial instruments are valued using Level 2 inputs. As of March 31, 2021, the estimated fair value of the Company’s debt was $455.8 million , compared to a carrying value of $455.7 million . As of December 31, 2020, the estimated fair value of the Company’s debt was $451.0 million, compared to a carrying value of $450.7 million . Marketable securities — The Company’s marketable securities are carried at fair value and are valued using Level 1 inputs. The estimated fair value of the Company’s marketable securities are based on quoted market prices that are readily and regularly available in an active market. Derivative instruments — The Company’s derivative instruments are comprised of interest rate swaps. All derivative instruments are carried at fair value and are valued using Level 2 inputs. The fair value of these instruments is determined using interest rate market pricing models. In addition, credit valuation adjustments are incorporated into the fair values to account for the Company’s potential nonperformance risk and the performance risk of the respective counterparties. Although the Company has determined that the majority of the inputs used to value its derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with those derivatives utilize Level 3 inputs, such as estimates of current credit spreads, to evaluate the likelihood of default by the Company and its counterparties. However, as of March 31, 2021 and December 31, 2020, the Company assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions and determined that the credit valuation adjustments are not significant to the overall valuation of the Company’s derivatives. As a result, t he Company has determined that its derivative valuations in their entirety are classified in Level 2 of the fair value hierarchy. Other financial instruments — The Company considers the carrying values of its cash and cash equivalents, restricted cash, tenant receivables, accrued expenses and accounts payable , other liabilities, due to affiliates and distributions payable to approximate their fair values because of the short period of time between their origination and their expected realization as well as their highly-liquid nature. Due to the short-term maturities of these instruments, Level 1 inputs are utilized to estimate the fair value of these financial instruments. Considerable judgment is necessary to develop estimated fair values of financial assets and liabilities. Accordingly, the estimates presented herein are not necessarily indicative of the amounts the Company could realize, or be liable for, upon disposition of the financial assets and liabilities. As of March 31, 2021 and December 31, 2020, there have been no transfers of financial assets or liabilities between fair value hierarchy levels. Items Measured at Fair Value on a Recurring Basis In accordance with the fair value hierarchy described above, the following tables show the fair value of the Company’s financial assets and liabilities that are required to be measured at fair value on a recurring basis as of March 31, 2021 and December 31, 2020 (in thousands): Balance as of Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant March 31, 2021 (Level 1) (Level 2) (Level 3) Financial assets: Marketable securities $ 15,062 $ 15,062 $ — $ — Financial liabilities: Interest rate swaps $ (6,996) $ — $ (6,996) $ — Balance as of Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant December 31, 2020 (Level 1) (Level 2) (Level 3) Financial assets: Marketable securities $ 15,496 $ 15,496 $ — $ — Financial liabilities: Interest rate swaps $ (8,509) $ — $ (8,509) $ — Items Measured at Fair Value on a Non-Recurring Basis (Including Impairment Charges) Certain financial and nonfinancial assets and liabilities are measured at fair value on a nonrecurring basis and are subject to fair value adjustments in certain circumstances, such as when there is evidence of impairment. The Company’s process for identifying and recording impairment related to real estate assets and intangible assets is discussed in Note 2 — Summary of Significant Accounting Policies. As discussed in Note 4 — Real Estate Assets, there were no impairment charges recorded during the three months ended March 31, 2021. Duri ng the three months ended March 31, 2020, real estate assets related to one retail property were impaired due to tenant bankruptcy. Additionally, real estate assets related to one anchored shopping center were deemed to be impaired, due to the carrying values being greater than the estimated fair value of the property, net of selling costs. The carrying values were reduced to an estimated fair value of $8.3 million, resulting in impairment charges of $5.7 million. The Company estimates fair values using Level 3 inputs and using a combined income and market approach, specifically using discounted cash flow analysis and recent comparable sales transactions. The evaluation of real estate assets for potential impairment requires the Company’s management to exercise significant judgment and to make certain key assumptions, including, but not limited to, the following: (1) terminal capitalization rates; (2) discount rates; (3) the number of years the property will be held; (4) property operating expenses; and (5) re-leasing assumptions, including the number of months to re-lease, market rental income and required tenant improvements. There are inherent uncertainties in making these estimates such as market conditions and the future performance and sustainability of the Company’s tenants. The Company determined that the selling prices used to determine the fair values were Level 2 inputs. The following summarizes the ranges of discount rates and terminal capitalization rates used for the Company’s impairment test for the real estate assets during the three months ended March 31, 2020 : Three Months Ended March 31, 2020 Discount Rate Terminal Capitalization Rate 9.7% 9.2% The following table presents the impairment charges by asset class recorded during the three months ended March 31, 2020 (in thousands): Three Months Ended March 31, 2020 Asset class impaired: Land $ 964 Buildings and improvements 3,454 Intangible lease assets 1,269 Intangible lease liabilities (1) Total impairment loss $ 5,686 |
REAL ESTATE ASSETS
REAL ESTATE ASSETS | 3 Months Ended |
Mar. 31, 2021 | |
Real Estate [Abstract] | |
REAL ESTATE ASSETS | REAL ESTATE ASSETS Property Acquisitions During the three months ended March 31, 2021 and 2020, the Company did not acquire any properties. 2021 Property Disposition During the three months ended March 31, 2021, the Company disposed of one retail property for a gross sales price of $1.1 million, resulting in net proceeds of $1.0 million after closing costs and a net gain of $10,000. The Company has no continuing involvement with this property. The gain on sale of real estate is included in gain on disposition of real estate, net in the condensed consolidated statements of operations. Accordingly, the operating results of this disposed property are reflected in the Company’s results from continuing operations for all periods presented through the date of disposition. 2020 Property Disposition During the three months ended March 31, 2020 , the Company disposed of one anchored shopping center (the “2020 Property Disposition”) for an aggregate gross sales price of $5.0 million, resulting in net proceeds of $4.8 million after closing costs, which approximated its net book value. The Company has no continuing involvement with this property. The disposition of this property did not qualify to be reported as discontinued operations since the disposition did not represent a strategic shift that had a major effect on the Company’s operations and financial results. Accordingly, the operating results of this disposed property are reflected in the Company’s results from continuing operations for all periods presented through the date of disposition. 2020 Impairment The Company performs quarterly impairment review procedures, primarily through continuous monitoring of events and changes in circumstances that could indicate that the carrying value of certain of its real estate assets may not be recoverable. See Note 2 — Summary of Significant Accounting Policies for a discussion on the Company’s accounting policies regarding impairment of real estate assets. During the three months ended March 31, 2020 , the 2020 Property Disposition, which totaled approximately 30,000 square feet with a carrying value of $4.8 million, and one retail property, which totaled approximately 60,000 square feet with a carrying value of $9.2 million, were deemed to be impaired and their carrying values were reduced to a combined estimated fair value of $8.3 million, resulting in impairment charges of $5.7 million, which were recorded in the condensed consolidated statements of operations. During the three months ended March 31, 2021, the Company did not record any impairment charges. Consolidated Joint Venture As of March 31, 2021, the Company had an interest in a Consolidated Joint Venture that owns and manages two properties, with total assets of $7.0 million, which included $7.2 million of land, building and improvements and $641,000 of intangible assets, net of accumulated depreciation and amortization of $981,000, and total liabilities of $134,000. The Consolidated Joint Venture did not have any debt outstanding as of March 31, 2021. The Company has the ability to control operating and financial policies of the Consolidated Joint Venture. There are restrictions on the use of these assets as the Company would generally be required to obtain the approval of the partner (the “Consolidated Joint Venture Partner”) in accordance with the joint venture agreement for any major transactions. The Company and the Consolidated Joint Venture Partner are subject to the |
INTANGIBLE LEASE ASSETS AND LIA
INTANGIBLE LEASE ASSETS AND LIABILITIES | 3 Months Ended |
Mar. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE LEASE ASSETS AND LIABILITIES | INTANGIBLE LEASE ASSETS AND LIABILITIES Intangible lease assets and liabilities consisted of the following as of March 31, 2021 and December 31, 2020 (in thousands, except weighted average life remaining): March 31, 2021 December 31, 2020 Intangible lease assets: In-place leases and other intangibles, net of accumulated amortization of $29,854 and $27,966, respectively (with a weighted average life remaining of 9.6 years and 9.8 years, respectively) $ 63,345 $ 65,157 Acquired above-market leases, net of accumulated amortization of $4,190 and $3,938, respectively (with a weighted average life remaining of 11.2 years and 11.4 years, respectively) 9,426 9,678 Total intangible lease assets, net $ 72,771 $ 74,835 Intangible lease liabilities: Acquired below-market leases, net of accumulated amortization of $5,058 and $4,734, respectively (with a weighted average life remaining of 10.0 years and 10.2 years, respectively) $ 11,716 $ 12,040 Amortization of the above-market leases is recorded as a reduction to rental and other property income, and amortization expense for the in-place leases and other intangibles is included in depreciation and amortization in the accompanying condensed consolidated statements of operations. Amortization of below-market leases is recorded as an increase to rental and other property income in the accompanying condensed consolidated statements of operations. The following table summarizes the amortization related to the intangible lease assets and liabilities for the three months ended March 31, 2021 and 2020 (in thousands): Three Months Ended March 31, 2021 2020 In-place lease and other intangible amortization $ 1,888 $ 2,029 Above-market lease amortization $ 252 $ 257 Below-market lease amortization $ 324 $ 353 As of March 31, 2021, the estimated amortization relating to the intangible lease assets and liabilities is as follows (in thousands): Amortization In-Place Leases and Other Intangibles Above-Market Leases Below-Market Leases Remainder of 2021 $ 5,650 $ 754 $ 913 2022 7,497 1,005 1,213 2023 7,342 1,004 1,203 2024 6,975 943 1,140 2025 6,330 882 1,109 Thereafter 29,551 4,838 6,138 Total $ 63,345 $ 9,426 $ 11,716 |
INVESTMENT IN CIM UII ONSHORE
INVESTMENT IN CIM UII ONSHORE | 3 Months Ended |
Mar. 31, 2021 | |
Equity Method Investments and Joint Ventures [Abstract] | |
INVESTMENT IN CIM UII ONSHORE | INVESTMENT IN CIM UII ONSHORE On September 27, 2019, the Company executed a subscription agreement (the “Subscription Agreement”) to purchase $50.0 million of limited partnership interests in CIM UII Onshore. CIM UII Onshore’s sole purpose is to invest all of its assets in CIM Urban Income, which is a private institutional fund that acquires, owns and operates substantially stabilized, diversified real estate and real estate-related assets in urban markets primarily located throughout North America. The investment was made by the Company to gain exposure to the urban real assets invested in by CIM Urban Income. The Company’s Subscription Agreement was accepted by the general partner of CIM UII Onshore on September 30, 2019, and the entire $50.0 million of capital was called and funded on March 31, 2020. The Company accounts for its investment using the equity method. During the three months ended March 31, 2021, the Company recognized an equity method net gain of $1.3 million related to its investment. The Company received distributions totaling $372,000 related to its investment during the three months ended March 31, 2021, which was recognized as a return of capital. As of March 31, 2021, the carrying value of the Company’s investment was $47.6 million, which represents less than 5% ownership of CIM UII Onshore, and approximates fair value. |
MARKETABLE SECURITIES
MARKETABLE SECURITIES | 3 Months Ended |
Mar. 31, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
MARKETABLE SECURITIES | MARKETABLE SECURITIES The Company owned marketable securities with an estimated fair value of $15.1 million and $15.5 million as of March 31, 2021 and December 31, 2020, respectively. The following is a summary of the Company’s available-for-sale securities as of March 31, 2021 (in thousands): Available-for-sale securities Amortized Cost Basis Unrealized Fair Value U.S. Treasury Bonds $ 5,932 $ 101 $ 6,033 U.S. Agency Bonds 1,902 21 1,923 Corporate Bonds 6,840 266 7,106 Total available-for-sale securities $ 14,674 $ 388 $ 15,062 The following table provides the activity for the marketable securities during the three months ended March 31, 2021 (in thousands): Amortized Cost Basis Unrealized Gain (Loss) Fair Value Marketable securities as of January 1, 2021 $ 14,755 $ 741 $ 15,496 Face value of marketable securities acquired 2,888 — 2,888 Premiums and discounts on purchase of marketable securities, net of acquisition costs 66 — 66 Amortization on marketable securities (22) — (22) Sales and maturities of securities (3,013) 15 (2,998) Unrealized loss on marketable securities — (368) (368) Marketable securities as of March 31, 2021 $ 14,674 $ 388 $ 15,062 During t he three months ended March 31, 2021, the Company sold 19 marketable securities for aggregate proceeds of $3.0 million, resulting in a loss of $15,000. In addition, the Company recorded an unrealized loss of $368,000 on its investments, which is included in accumulated other comprehensive (loss) income attributable to the Company in the accompanying condensed consolidated statement of changes in equity for the three months ended March 31, 2021 and included in accumulated other comprehensive loss in the condensed consolidated balance sheet as of March 31, 2021. The total unrealized holding gain on marketable securities of $388,000 and $741,000 as of March 31, 2021 and December 31, 2020, respectively, is included in accumulated other comprehensive loss attributable to the Company in the accompanying condensed consolidated statement of changes in equity. The scheduled maturities of the Company’s marketable securities as of March 31, 2021 are as follows (in thousands): Available-for-sale securities Amortized Cost Estimated Fair Value Due within one year $ 1,256 $ 1,269 Due after one year through five years 6,805 7,080 Due after five years through ten years 4,738 4,819 Due after ten years 1,875 1,894 Total $ 14,674 $ 15,062 Actual maturities of marketable securities can differ from contractual maturities because borrowers on certain debt securities may have the right to prepay their respective debt obligations at any time. In addition, factors such as prepayments and interest rates may affect the yields on such securities. In estimating credit losses, management considers a variety of factors, including (1) whether the Company will be required to sell the impaired security before the recovery of its amortized cost basis, (2) whether the Company expects to hold the investment for a period of time sufficient to allow for anticipated recovery in fair value, and (3) whether the Company expects to recover the entire amortized cost basis of the security. The Company believes that none of the unrealized losses on investment securities are credit losses, as management expects the Company will fully recover the entire amortized cost basis of all securities. As of March 31, 2021, the Company had no credit losses. |
DERIVATIVE INSTRUMENTS AND HEDG
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | 3 Months Ended |
Mar. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES In the normal course of business, the Company uses certain types of derivative instruments for the purpose of managing or hedging its interest rate risk. As of March 31, 2021, the Company had eight interest rate swap agreements. The following table summarizes the terms of the Company’s executed interest rate swap agreements designated as hedging instruments as of March 31, 2021 and December 31, 2020 (dollar amounts in thousands): Outstanding Notional Amount as of Interest Effective Maturity Fair Value of Liabilities as of Balance Sheet Location March 31, 2021 Rate (1) Date Date March 31, 2021 December 31, 2020 Interest Rate Swaps Derivative liabilities, deferred rental income and other liabilities $ 281,465 3.46% to 4.99% 12/16/2016 to 9/30/2019 9/30/2021 to 9/6/2022 $ (6,996) $ (8,509) ______________________ (1) The interest rates consist of the underlying index swapped to a fixed rate and the applicable interest rate spread as of March 31, 2021. Additional disclosures related to the fair value of the Company’s derivative instruments are included in Note 3 — Fair Value Measurements. The notional amount under the interest rate swap agreements is an indication of the extent of the Company’s involvement in each instrument, but does not represent exposure to credit, interest rate or market risks. Accounting for changes in the fair value of a derivative instrument depends on the intended use and designation of the derivative instrument. The Company designated the interest rate swaps as cash flow hedges in order to hedge the variability of the anticipated cash flows on its variable rate debt. The change in fair value of the derivative instruments that are designated as hedges is recorded in other comprehensive income (loss) , with a portion of the amount subsequently reclassified to interest expense as interest payments are made on the Company’s variable rate debt. For the three months ended March 31, 2021 and 2020, the amount of losses reclassified from other comprehensive income (loss) as an increase to interest expense was $1.5 million and $388,000, respectively. The total unrealized holding loss on interest rate swaps of $7.0 million and $8.5 million as of March 31, 2021 and December 31, 2020, respectively, is included in accumulated other comprehensive (loss) income attributable to the Company in the accompanying condensed consolidated statement of changes in equity. During the next 12 months, the Company estimates that an additional $5.3 million will be reclassified from total other comprehensive income (loss) as an increase to interest expense. The Company includes cash flows from interest rate swap agreements in cash flows provided by operating activities on the condensed consolidated statements of cash flows, as the Company’s accounting policy is to present cash flows from hedging instruments in the same category in the condensed consolidated statements of cash flows as the category for cash flows from the hedged items. The Company has agreements with each of its derivative counterparties that contain provisions whereby, if the Company defaults on certain of its unsecured indebtedness, the Company could also be declared in default on its derivative obligations, resulting in an acceleration of payment. If the Company had breached any of these provisions, it could have been required to settle its obligations under the agreements at an aggregate termination value, inclusive of interest payments of $7.1 million , which includes accrued interest, at March 31, 2021. In addition, the Company is exposed to credit risk in the event of non-performance by its derivative counterparties. The Company believes it mitigates its credit risk by entering into agreements with creditworthy counterparties. The Company records credit risk valuation adjustments on its interest rate swaps based on the credit quality of the Company and the respective counterparty. There were no termination events or events of default related to the interest rate swaps as of March 31, 2021. |
CREDIT FACILITY AND NOTES PAYAB
CREDIT FACILITY AND NOTES PAYABLE | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
CREDIT FACILITY AND NOTES PAYABLE | CREDIT FACILITY AND NOTES PAYABLE As of March 31, 2021, the Company had $454.5 million of debt outstanding, including net deferred financing costs, with a weighted average years to maturity of 1.2 years and a weighted average interest rate of 3.64%. The weighted average years to maturity is computed using the scheduled repayment date as specified in each loan agreement where applicable. The weighted average interest rate is computed using the interest rate in effect until the scheduled repayment date . Sho uld a loan not be repaid by its scheduled repayment date, the applicable interest rate will increase as specified in the respective loan agreement until the extended maturity date. The following table summarizes the debt balances as of March 31, 2021 and December 31, 2020, and the debt activity for the three months ended March 31, 2021 (in thousands): During the Three Months Ended March 31, 2021 Balance as of Debt Issuance, Net (1) Repayments Amortization Balance as of Credit facility $ 321,500 $ 5,000 $ — $ — $ 326,500 Notes payable – fixed rate debt 129,219 — — — 129,219 Total debt 450,719 5,000 — — 455,719 Deferred costs – credit facility (2) (645) — — 94 (551) Deferred costs – fixed rate debt (696) — — 66 (630) Total debt, net $ 449,378 $ 5,000 $ — $ 160 $ 454,538 ______________________ (1) Includes deferred financing costs incurred during the period, if applicable. (2) Deferred costs are related to the term portion of the credit facility. Notes Payable As of March 31, 2021, the Company had fixed rate debt outstanding of $129.2 million , including $69.0 million of variable rate debt that is fixed through interest rate swap agreements, which has the effect of fixing the variable interest rate per annum through the maturity date of the variable rate debt. The fixed rate debt has interest rates ranging from 3.56% to 4.17% per annum and as of March 31, 2021, the fixed rate debt had a weighted average interest rate of 3.93%. The fixed rate debt outstanding matures on various dates from October 2021 to February 2025. The aggregate balance of gross real estate assets, net of gross intangible lease liabilities, securing the fixed rate debt outstanding was $228.9 million as of March 31, 2021. Each of the mortgage notes payable comprising the fixed rate debt is secured by the respective properties on which th e debt was placed. Credit Facility T he Company is party to a second amended and restated credit agreement (the “Second Amended Credit Agreement”) with JPMorgan Chase Bank, N.A. as administrative agent (“JPMorgan Chase”), that provides for borrowings up to $425.0 million, which is comprised of up to $212.5 million in unsecured revolving loans (the “Revolving Loans”) and up to $212.5 million in unsecured term loans (the “Term Loans,” and collectively with the Revolving Loans, the “Credit Facility”). The Term Loans mature on September 6, 2022 and the Revolving Loans mature on September 6, 2021 ; however, the Company may elect to extend the maturity date for the Revolving Loans for up to two six-month periods, but no later than September 6, 2022 , subject to satisfying certain conditions contained in the Second Amended Credit Agreement. Depending upon the type of loan specified and overall leverage ratio, the Credit Facility bears interest at (i) the one-month, two-month, three-month or six-month LIBOR multiplied by the statutory reserve rate (the “Eurodollar Rate”) plus an interest rate spread ranging from 1.70% to 2.20% for Revolving Loans and 1.60% to 2.10% for Term Loans; or (ii) a base rate ranging from 0.70% to 1.20% for Revolving Loans and 0.60% to 1.10% for Term Loans, plus the greater of: (a) JPMorgan Chase’s Prime Rate (as defined in the Second Amended Credit Agreement); (b) the Federal Funds Effective Rate (as defined in the Second Amended Credit Agreement) plus 0.50%; or (c) the one-month LIBOR multiplied by the statutory reserve rate plus 1.0%. As of March 31, 2021, the Revolving Loans outstanding totaled $114.0 million at a weighted average interest rate of 2.16%. As of March 31, 2021, the Term Loans outstanding totaled $212.5 million, all of which are subject to interest rate swap agreements (the “Swapped Term Loans”). The interest rate swap agreements have th e effect of fixing the Eurodollar Rate per annum of the Swapped Term Loan at an all-in rate of 4.25%. As of March 31, 2021, the Company had $326.5 million ou tstanding under the Credit Facility at a weighted average interest rate of 3.52% and $98.5 million in unused capacity, subject to borrowing availability. The Company had available borrowings of $23.2 million as of March 31, 2021. The Second Amended Credit Agreement contains provisions with respect to covenants, events of default and remedies customary for facilities of this nature. In particular, the Second Amended Credit Agreement requires the Company to maintain a minimum consolidated net worth greater than or equal to the sum of (i) $367.1 million plus (ii) 75% of the equity issued minus (iii) the aggregate amount of any redemptions or similar transaction from the date of the Second Amended Credit Agreement; a leverage ratio less than or equal to 60%; a fixed charge coverage ratio equal to or greater than 1.50; an unsecured debt to unencumbered asset value ratio equal to or less than 60%; an unsecured debt service coverage ratio greater than 1.75; a secured debt ratio equal to or less than 40%; and the amount of secured debt that is recourse debt at no greater than 15% of total asset value. As of March 31, 2021, the Company believes it was in compliance with the financial covenants of the Second Amended Credit Agreement, as well as the financial covenants under the Company’s various fixed and variable rate debt agreements. Maturities As of March 31, 2021, the Company had $114.0 million of debt outstanding under the Credit Facility maturing on September 6, 2021 and $20.4 million of fixed rate debt due during the remainder of 2021. For the debt outstanding under the Credit Facility, the Company expects to extend the maturity date for the Revolving Loans for up to two six-month periods, subject to satisfying certain conditions contained in the Second Amended Credit Agreement. For the fixed rate debt, the Company expects to use cash on hand or entering into new financing arrangements in order to meet its debt obligations, which management believes is probable based on the current loan-to-value ratios, the occupancy of the Company’s properties and assessment of the lending environment. The Company believes cash on hand, net cash provided by operations and the entry into new financing arrangements will be sufficient to meet its obligations as they become due in the ordinary course of business for at least 12 months following the date these financial statements are issued. The following table summarizes the scheduled aggregate principal repayments for the Company’s outstanding debt subsequent to March 31, 2021 (in thousands): Principal Repayments Remainder of 2021 $ 134,442 2022 304,327 2023 — 2024 — 2025 16,950 Thereafter — Total $ 455,719 |
SUPPLEMENTAL CASH FLOW DISCLOSU
SUPPLEMENTAL CASH FLOW DISCLOSURES | 3 Months Ended |
Mar. 31, 2021 | |
Supplemental Cash Flow Elements [Abstract] | |
SUPPLEMENTAL CASH FLOW DISCLOSURES | SUPPLEMENTAL CASH FLOW DISCLOSURES Supplemental cash flow disclosures for the three months ended March 31, 2021 and 2020 are as follows (in thousands): Three Months Ended March 31, 2021 2020 Supplemental Disclosures of Non-Cash Investing and Financing Activities: Change in accrued dealer manager fees, ongoing stockholder servicing fees, and other offering costs $ 155 $ 92 Distributions to stockholders declared and unpaid $ 2,328 $ 2,718 Common stock issued through distribution reinvestment plan $ 4,274 $ 4,011 Redemptions to stockholders declared and unpaid $ 1,952 $ — Change in fair value of marketable securities $ (353) $ 149 Change in fair value of interest rate swaps $ 1,513 $ (7,196) Supplemental Cash Flow Disclosures: Interest paid $ 4,144 $ 3,491 Cash paid for taxes $ 24 $ 22 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Litigation In the ordinary course of business, the Company may become subject to litigation and claims. The Company is not aware of any material pending legal proceedings, other than ordinary routine litigation incidental to the Company’s business, to which the Company is a party or of which the Company’s properties are the subject. Environmental Matters In connection with the ownership and operation of real estate, the Company may potentially be liable for costs and damages related to environmental matters. In addition, the Company may own or acquire certain properties that are subject to environmental remediation. Generally, the seller of the property, the tenant of the property and/or another third party is responsible for environmental remediation costs related to a property. Additionally, in connection with the purchase of certain properties, the respective sellers and/or tenants may agree to indemnify the Company against future remediation costs. The Company also carries environmental liability insurance on its properties that provides limited coverage for any remediation liability and/or pollution liability for third-party bodily injury and/or property damage claims for which the Company may be liable. The Company is not aware of any environmental matters which it believes are reasonably likely to have a material effect on its results of operations, financial condition or liquidity. |
RELATED-PARTY TRANSACTIONS AND
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS | 3 Months Ended |
Mar. 31, 2021 | |
Related Party Transactions [Abstract] | |
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS | RELATED-PARTY TRANSACTIONS AND ARRANGEMENTSThe Company has incurred, and will continue to incur, commissions, fees and expenses payable to CIM Income NAV Management and certain of its affiliates in connection with the Offering, and the acquisition, management and performance of the Company’s assets. Upfront selling commissions, dealer manager and ongoing stockholder servicing fees In connection with the Offering, CCO Capital, the Company’s dealer manager, will receive upfront selling commissions and dealer manager fees, and/or asset-based stockholder servicing fees, as summarized in the table below for each class of common stock: Upfront Selling Commissions Dealer Manager Fees Ongoing Stockholder Servicing Fees (2) D Shares (1) — % — % 0.25 % T Shares (1) 3.00 % 0.50 % 0.85 % S Shares (1) 3.50 % — % 0.85 % I Shares — % — % — % ______________________ (1) The upfront selling commissions are based on a percentage of the transaction price, which is exclusive of the upfront selling commission for T Shares and S Shares. Prior to February 28, 2020, there was a 1.50% upfront selling commission payable on D Shares. Effective February 28, 2020, there are no upfront selling commissions or dealer manager fees payable on D Shares. The dealer manager fee for T Shares is based on a percentage of the transaction price for T Shares. Upfront selling commissions and dealer manager fees are deducted directly from the offering price for T Shares and S Shares and paid to CCO Capital. The Company has been advised that CCO Capital intends to reallow 100% of the upfront selling commissions on T Shares and S Shares to participating broker-dealers and may reallow a portion of the dealer manager fee. (2) The stockholder servicing fees are calculated as a percentage of the NAV per D Share, T Share or S Share, as applicable, and are paid monthly in arrears. CCO Capital, in its sole discretion, may reallow a portion of the stockholder servicing fees to participating broker-dealers. The Company will cease paying the stockholder servicing fees with respect to any D Shares, T Shares or S Shares held in a stockholder’s account when the total upfront selling commissions, dealer manager fees and stockholder servicing fees would exceed, in the aggregate, 8.75% (or, in the case of shares sold through certain participating broker-dealers, a lower limit as set forth in any applicable agreement between the Company’s dealer manager and a participating broker-dealer) of the gross proceeds from the sale of such shares. Other organization and offering expenses All other organization and offering expenses associated with the sale of the Company’s common stock (excluding upfront selling commissions, dealer manager fees and the ongoing stockholder servicing fees) are paid for by CIM Income NAV Management or its affiliates and can be reimbursed by the Company up to 0.75% of the aggregate gross offering proceeds, excluding upfront selling commissions and dealer manager fees charged on T Shares and S Shares sold in the Primary Offering. Prior to February 28, 2020, there was a 1.50% upfront selling commission on D Shares. Effective February 28, 2020, there are no upfront selling commissions on D Shares. As of March 31, 2021, CIM Income NAV Management or its affiliates had paid organization and offering expenses in excess of 0.75% of the gross proceeds from the Offering. These excess amounts were not included in the financial statements of the Company because such amounts were not a liability of the Company as they exceeded 0.75% of gross proceeds from the Offering. As the Company raises additional proceeds from the Offering, these excess amounts may become payable to CIM Income NAV Management or its affiliates. Advisory fees and expenses The Company pays CIM Income NAV Management an asset-based advisory fee that is payable in arrears on a monthly basis and accrues daily in an amount equal to 1/365th of 1.10% of the Company’s NAV for each class of common stock. At the request of the Board, CIM Income NAV Management agreed to take 50% of the monthly advisory fee payment from August 2020 through September 30, 2021 in I Shares based on the then current NAV per share of such shares at the time of issuance. During the three months ended March 31, 2021, approximately 33,000 Class I Shares were issued for payment of advisory fees, which vested upon issuance, totaling $561,000 in equity-based payments for the three months ended March 31, 2021, which are included in advisory fees and expenses in the condensed consolidated statements of operations. Operating expenses The Company reimburses CIM Income NAV Management for the operating expenses it paid or incurred in connection with the services provided to the Company, subject to the limitation that the Company will not reimburse for any amount by which its operating expenses (including the advisory fee) at the end of the four preceding fiscal quarters exceeds the greater of (1) 2% of average invested assets, or (2) 25% of net income other than any additions to reserves for depreciation, bad debts or other similar non-cash reserves and excluding any gain from the sale of assets for that period. Acquisition expenses In addition, the Company reimburses CIM Income NAV Management for all out-of-pocket expenses incurred in connection with the acquisition of the Company’s investments. While most of the acquisition expenses are expected to be paid to third parties, a portion of the out-of-pocket acquisition expenses may be reimbursed to CIM Income NAV Management or its affiliates. Acquisition expenses, together with any acquisition fees paid to third parties for a particular real estate-related asset, will in no event exceed 6% of the gross purchase price of such asset. Other acquisition-related expenses, such as advisor reimbursements, are expensed as incurred and are included in transaction-related expenses in the accompanying condensed consolidated statements of operations. Performance Fee As compensation for services provided pursuant to the second amended and restated advisory agreement with CIM Income NAV Management (the “Advisory Agreement”), the Company will also pay CIM Income NAV Management a performance-based fee calculated based on the Company’s annual total return to stockholders for each class of common stock (defined below), payable annually in arrears. The total return to stockholders is defined, for each class of the Company’s common stock, as the change in NAV per share plus distributions per share for such class. For each respective class, the NAV per share calculated on the last trading day of a calendar year shall be the amount against which changes in NAV per share for such class are measured during the subsequent calendar year. Under the terms of the Advisory Agreement, in the event that performance fees are earned for any particular period, CIM Income NAV Management will not be obligated to return any portion of such fees previously paid based on the Company’s subsequent performance. Starting with the period beginning on January 1, 2019, the performance-based fee is equal to 12.5% of the Total Return for each class of common stock, subject to a 5% Hurdle Amount, a High Water Mark and a Catch-Up (each term as defined in the Advisory Agreement), payable annually in arrears. The Company did not reach the 5% Hurdle Amount during the three months ended March 31, 2021 or 2020 and therefore, no performance fee was paid during such periods. The Company incurred commissions, fees and expense reimbursements as shown in the table below for services provided by CIM Income NAV Management and its affiliates related to the services described above during the periods indicated (in thousands): Three Months Ended March 31, 2021 2020 Upfront selling commissions $ 4 $ 323 Stockholder servicing fees (1) $ 607 $ 633 Dealer manager fees (1) $ 1 $ 56 Organization and offering expense reimbursement $ 36 $ 149 Acquisition expense reimbursement $ 212 $ 89 Advisory fee $ 1,497 $ 1,740 Operating expense reimbursement $ 372 $ 166 ______________________ (1) Amounts are calculated for the respective period in accordance with the dealer manager agreement and exclude the estimated liability for the future fees payable to CCO Capital of $11.4 million and $13.3 million as of March 31, 2021 and 2020, respectively, which are included in due to affiliates in the condensed consolidated balance sheets, with a corresponding decrease to capital in excess of par value, as described in Note 2 — Summary of Significant Accounting Policies. Due to/from Affiliates As of March 31, 2021 and December 31, 2020, $13.6 million and $13.8 million, respectively, was due to CIM Income NAV Management or its affiliates, primarily related to the estimated liability for current and future stockholder servicing fees, the reimbursement of organization and offering expenses and advisory fees, which were included in amounts due to affiliates on the condensed consolidated balance sheets. As of December 31, 2020, $7,000 was due from CIM Income NAV Management or its affiliates related to amounts received by affiliates of the advisor which were due to the Company. There were no such amounts due from CIM Income NAV Management as of March 31, 2021. CIM UII Onshore Investment On September 27, 2019, the Company executed the Subscription Agreement to purchase $50.0 million of limited partnership interests of CIM UII Onshore, which was accepted by the general partner of CIM UII Onshore on September 30, 2019. The Company is required to pay CIM UII Onshore a management fee equal to 0.65% per annum of its share of the NAV of CIM Urban Income. For the three months ended March 31, 2021, the Company incurred $75,000 of management fees to CIM UII Onshore, which was recorded as a reduction to the Advisory fees incurred pursuant to the Advisory Agreement. As of March 31, 2021, the limited partnership interest in CIM UII Onshore had a carrying value of $47.6 million . Both CIM UII Onshore and CIM Urban Income were formed by CIM, and CIM controls the general partner of both CIM UII Onshore and CIM Urban Income. |
ECONOMIC DEPENDENCY
ECONOMIC DEPENDENCY | 3 Months Ended |
Mar. 31, 2021 | |
Economic Dependency [Abstract] | |
ECONOMIC DEPENDENCY | ECONOMIC DEPENDENCYUnder various agreements, the Company has engaged and may in the future engage CIM Income NAV Management or its affiliates to provide certain services that are essential to the Company, including asset management services, supervision of the management and leasing of properties owned by the Company, asset acquisition and disposition decisions, the sale of shares of the Company’s common stock available for issuance, as well as other administrative responsibilities for the Company including accounting services and stockholder relations. As a result of these relationships, the Company is dependent upon CIM Income NAV Management or its affiliates. In the event that these companies are unable to provide the Company with these services, the Company would be required to find alternative providers of these services. |
STOCKHOLDERS_ EQUITY
STOCKHOLDERS’ EQUITY | 3 Months Ended |
Mar. 31, 2021 | |
Equity [Abstract] | |
STOCKHOLDERS’ EQUITY | STOCKHOLDERS’ EQUITY The table below provides information regarding the issuances and redemptions of each class of the Company’s common stock during the three months ended March 31, 2021 and 2020 (dollar amounts in thousands): D Shares T Shares S Shares I Shares Total Shares Par Value Shares Par Value Shares Par Value Shares Par Value Shares Par Value Balance as of January 1, 2021 15,318,506 $ 153 13,778,134 $ 138 7,399 $ — 1,011,342 $ 10 30,115,381 $ 301 Issuance of common stock 146,827 2 136,249 1 141 — 7,036 — 290,253 3 Redemptions of common stock (364,171) (4) (232,939) (2) — — (5,867) — (602,977) (6) Equity-based compensation 2,923 — — — — — — — 2,923 — Equity-based payments to Advisor — — — — — — 32,775 — 32,775 — Balance as of March 31, 2021 15,104,085 $ 151 13,681,444 $ 137 7,540 $ — 1,045,286 $ 10 29,838,355 $ 298 D Shares T Shares S Shares I Shares Total Shares Par Value Shares Par Value Shares Par Value Shares Par Value Shares Par Value Balance as of January 1, 2020 18,143,147 $ 181 14,499,636 $ 145 7,031 $ — 1,097,896 $ 11 33,747,710 $ 337 Issuance of common stock 356,188 4 752,814 7 98 — 21,964 — 1,131,064 11 Redemptions of common stock (1,657,375) (17) (830,138) (8) — — (166,073) (1) (2,653,586) (26) Balance as of March 31, 2020 16,841,960 $ 168 14,422,312 $ 144 7,129 $ — 953,787 $ 10 32,225,188 $ 322 Equity-Based Compensation On August 9, 2018, the Board approved the adoption of the Company’s 2018 Equity Incentive Plan (the “Plan”), under which 400,000 of the Company’s common shares were reserved for issuance and share awards of 378,000 shares are available for future grant as of March 31, 2021. As of March 31, 2021, the Company has granted awards of approximately 5,600 restricted D Shares to each of the independent members of the Board (approximately 22,400 restricted shares in aggregate) under the Plan. As of March 31, 2021, 14,600 of the restricted D Shares had vested based on one year of continuous service. The remaining 7,800 shares issued had not been forfeited as of March 31, 2021. The fair value of the Company’s share awards is determined using the Company’s NAV per share on the date of grant. Compensation expense related to these restricted D Shares is recognized over the vesting period. The Company recorded compensation expense of $33,000 for the three months ended March 31, 2021 related to these restricted D Shares, which is included in general and administrative expenses in the accompanying condensed consolidated statements of operations. As of March 31, 2021 , there was $66,000 of total unrecognized compensation expense related to the restricted D Shares issued in 2020, which will be recognized ratably over the remaining period of service prior to October 1, 2021. The Board determined 50% of the Company’s independent directors’ quarterly compensation payments for the third quarter of 2020 through the third quarter of 2021 would be paid in D Shares based on the then current NAV per share at the time of issuance. As of March 31, 2021, the Company has granted awards of approximately 1,450 unrestricted D Shares to each of the independent members of the Board (approximately 5,800 unrestricted shares in aggregate). The Company recorded compensation expense of $49,000 for the three months ended March 31, 2021 related to these unrestricted D Shares, which is included in general and administrative expenses in the accompanying condensed consolidated statements of operations. |
LEASES
LEASES | 3 Months Ended |
Mar. 31, 2021 | |
Leases [Abstract] | |
LEASES | LEASES The Company’s real estate assets are leased to tenants under operating leases for which the terms, expirations and extension options vary. The Company’s operating leases do not convey to the lessee the right to purchase the underlying asset upon expiration of the lease period. To determine whether a contract contains a lease, the Company reviews contracts to determine if the agreement conveys the right to control the use of an asset. The Company accounts for lease and non-lease components as a single, combined operating lease component. Non-lease components primarily consist of maintenance services, including CAM, real estate taxes, insurance and utilities paid for by the lessor but consumed by the lessee. Non-lease components are considered to be variable rental and other property income and are recognized in the period incurred. As of March 31, 2021, the Company’s leases had a weighted-average remaining term of 9.6 years. Certain leases include provisions to extend the lease agreements, options for early termination after paying a specified penalty, rights of first refusal to purchase the property at competitive market rates, and other negotiated terms and conditions. The Company retains substantially all of the risks and benefits of ownership of the real estate assets leased to tenants. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. As of March 31, 2021, the future minimum rental income from the Company’s real estate assets under non-cancelable operating leases, assuming no exercise of renewal options for the succeeding five fiscal years and thereafter, was as follows (in thousands): Future Minimum Rental Income Remainder of 2021 $ 46,885 2022 62,714 2023 62,728 2024 61,335 2025 57,498 Thereafter 335,279 Total $ 626,439 A certain amount of the Company’s rental and other property income is from tenants with leases which are subject to contingent rent provisions. These contingent rents are subject to the tenant achieving periodic revenues in excess of specified levels. For the three months ended March 31, 2021 and 2020, the amount of the contingent rent earned by the Company was not significant . Rental and other property income during the three months ended March 31, 2021 and 2020 consisted of the following (in thousands): Three Months Ended March 31, 2021 2020 Fixed rental and other property income (1) $ 16,292 $ 16,161 Variable rental and other property income (2) 2,406 2,427 Total rental and other property income $ 18,698 $ 18,588 ______________________ (1) Consists primarily of fixed contractual payments from operating leases with tenants recognized on a straight-line basis over the lease term, including amortization of acquired above- and below-market leases, and is net of uncollectible lease-related receivables. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2021 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTSThe Company evaluated events subsequent to March 31, 2021, and concluded that no subsequent events have occurred that would require recognition or disclosure in the condensed consolidated unaudited financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | The condensed consolidated financial statements of the Company have been prepared in accordance with the rules and regulations of the U.S. Securities and Exchange Commission regarding interim financial reporting, including the instructions to Form 10-Q and Article 10 of Regulation S-X, and do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, the statements for the interim periods presented include all adjustments, which are of a normal and recurring nature, necessary for a fair presentation of the results for such periods. Results for these interim periods are not necessarily indicative of full year results. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the Company’s audited consolidated financial statements as of and for the year ended December 31, 2020, and related notes thereto set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020. The condensed consolidated financial statements should also be read in conjunction with Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in this Quarterly Report on Form 10-Q. |
Principles of Consolidation | The condensed consolidated financial statements include the accounts of the Company, its wholly-owned subsidiaries and the Consolidated Joint Venture in which the Company has a controlling financial interest. All intercompany balances and transactions have been eliminated in consolidation. |
Noncontrolling Interest in Consolidated Joint Venture | The Company evaluates its relationships and investments to determine if it has variable interests. A variable interest is an investment or other interest that will absorb portions of an entity’s expected losses or receive portions of the entity’s expected residual returns. If the Company determines that it has a variable interest in an entity, it evaluates whether such interest is in a variable interest entity (“VIE”). VIEs are entities where investors lack sufficient equity at risk for the entity to finance its activities without additional subordinated financial support or where equity investors, as a group, lack one of the following characteristics: (a) the power to direct the activities that most significantly impact the entity’s economic performance, (b) the obligation to absorb the expected losses of the entity, or (c) the right to receive the expected returns of the entity. The Company consolidates any VIEs when it is determined to be the primary beneficiary of the VIE’s operations. For legal entities being evaluated for consolidation, the Company must first determine whether the interests that it holds and fees it receives qualify as variable interests in the entity. A variable interest is an investment or other interest that will absorb portions of an entity’s expected losses or receive portions of the entity’s expected residual returns. The Company’s evaluation includes consideration of fees paid to the Company where the Company acts as a decision maker or service provider to the entity being evaluated. If the Company determines that it holds a variable interest in an entity, it evaluates whether that entity is a VIE. A VIE must be consolidated by its primary beneficiary, which is generally defined as the party who has a controlling financial interest in the VIE. The Company qualitatively assesses whether it is (or is not) the primary beneficiary of a VIE. Consideration of various factors include, but are not limited to, the Company’s ability to direct the activities that most significantly impact the entity’s economic performance and its obligation to absorb losses from or right to receive benefits of the VIE that could potentially be significant to the VIE. The Company consolidates any VIEs when the Company is determined to be the primary beneficiary of the VIE, and the difference between consolidating the VIE and accounting for it using the equity method could be material to the Company’s condensed consolidated financial statements. The Company continually evaluates the need to consolidate any VIEs based on standards set forth in GAAP as described above. As of March 31, 2021 and December 31, 2020 , the Company determined that it had a controlling interest in the Consolidated Joint Venture and therefore met the requirements for consolidation. |
Reclassifications | Reclassifications The Company is separately presenting the write-off of uncollectible lease-related receivables of $158,000 for the three months ended March 31, 2020, which was previously included in straight-line rental income, net in the condensed consolidated statements of cash flows. This reclassification had no effect on previously reported totals or subtotals. |
Use of Estimates | Use of Estimates The preparation of 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 condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Real Estate Assets, Recoverability of Real Estate Assets, Assets Held for Sale and Disposition of Real Estate Assets | Real Estate Assets Real estate assets are stated at cost, less accumulated depreciation and amortization. The Company considers the period of future benefit of each respective asset to determine the appropriate useful life. The estimated useful lives of the Company’s real estate assets by class are generally as follows: Buildings 40 years Site improvements 15 years Tenant improvements Lesser of useful life or lease term Intangible lease assets Lease term Recoverability of Real Estate Assets The Company’s impairment assessment as of March 31, 2021 was based on the most current information available to the Company, including expected holding periods. If the Company’s expected holding periods for assets change, subsequent tests for impairment could result in additional impairment charges in the future. The Company cannot provide any assurance that additional material impairment charges with respect to the Company’s real estate assets will not occur during 2021 or in future periods. Disposition of Real Estate Assets Gains and losses from dispositions are recognized once the various criteria relating to the terms of sale and any subsequent involvement by the Company with the asset sold are met. A discontinued operation includes only the disposal of a component of an entity and represents a strategic shift that has (or will have) a major effect on an entity’s financial results. The Company’s property dispositions during the three months ended March 31, 2021 and 2020 did not qualify for discontinued operations presentation, and thus, the results of the properties that have been sold remain in operating income, and any associated gains or losses from the disposition are included in gain on disposition of real estate, net . |
Allocation of Purchase Price of Real Estate Assets | Allocation of Purchase Price of Real Estate Assets Upon the acquisition of real properties, the Company allocates the purchase price to acquired tangible assets, consisting of land, buildings and improvements, and to identified intangible assets and liabilities, consisting of the value of above- and below-market leases and the value of in-place leases and other intangibles, based in each case on their respective fair values. The Company utilizes independent appraisals to assist in the determination of the fair values of the tangible assets of an acquired property (which includes land and buildings). The information in the appraisal, along with any additional information available to the Company’s management, is used in estimating the amount of the purchase price that is allocated to land. Other information in the appraisal, such as building value and market rents, may be used by the Company’s management in estimating the allocation of purchase price to the building and to intangible lease assets and liabilities. The appraisal firm has no involvement in management’s allocation decisions other than providing this market information. The determination of the fair values of the real estate assets and liabilities acquired requires the use of significant assumptions with regard to the current market rental rates, rental growth rates, capitalization and discount rates, interest rates and other variables. The use of alternative estimates may result in a different allocation of the Company’s purchase price, which could materially impact the Company’s results of operations. |
Investment in Marketable Securities | Investment in Marketable Securities Investment in marketable securities consists primarily of the Company’s investment in corporate and government debt securities. The Company determines the appropriate classification for debt securities at the time of purchase and reevaluates such designation as of each balance sheet date. As of March 31, 2021, the Company classified its investments as available-for-sale as the Company is not actively trading the securities; however, the Company may sell them prior to their maturity. These investments are carried at their estimated fair value with unrealized gains and losses reported in other comprehensive income (loss) . The Company monitors its available-for-sale securities for impairments. A loss is recognized when the Company determines that a decline in the estimated fair value of a security below its amortized cost has resulted from a credit loss or other factors. The Company records impairments related to credit losses through an allowance for credit losses. However, the allowance is limited by the amount that the fair value is less than the amortized cost basis. The Company considers many factors in determining whether a credit loss exists, including, but not limited to, the extent to which the fair value is less than the amortized cost basis, recent events specific to the security, industry or geographic area, the payment structure of the security, the failure of the issuer of the security to make scheduled interest or principal payments, and external credit ratings and recent changes in such ratings. The analysis of determining whether a credit loss exists requires significant judgments and assumptions. The use of alternative judgments and assumptions could result in a different conclusion. |
Investment in CIM UII Onshore | Investment in CIM UII OnshoreThe Company accounts for its investment under the equity method. The equity method of accounting requires the investment to be initially recorded at cost, including transaction costs incurred to finalize the investment, and subsequently adjusted for the Company’s share of equity in CIM UII Onshore’s earnings and distributions. The Company records its share of CIM UII Onshore’s profits or losses on a quarterly basis as an adjustment to the carrying value of the investment on the Company’s condensed consolidated balance sheet and is recognized as a profit or loss on the condensed consolidated statements of operations. |
Restricted Cash | Restricted CashAs part of certain debt agreements, rent from certain of the Company’s tenants is deposited directly into a lockbox account, from which funds in excess of the required minimum balance are disbursed on a weekly basis to the Company. |
Stockholder Servicing Fees | Stockholder Servicing Fees The Company pays CCO Capital stockholder servicing fees, which are calculated on a daily basis in the amount of 1/365th of 0.25%, 0.85% and 0.85% of the NAV per share, for each class of common stock outstanding for D Shares, T Shares and S Shares, respectively. The Company does not pay a stockholder servicing fee with respect to I Shares. |
Leases | Leases The Company has lease agreements with lease and non-lease components. The Company has elected to not separate non-lease components from lease components for all classes of underlying assets (primarily real estate assets) and will account for the combined components as rental and other property income. Non-lease components included in rental and other property income include certain tenant reimbursements for maintenance services (including common-area maintenance services or “CAM”), real estate taxes, insurance and utilities paid for by the lessor but consumed by the lessee. As a lessor, the Company has further determined that this policy will be effective only on a lease that has been classified as an operating lease and the revenue recognition pattern and timing is the same for both types of components. The Company is not party to any material leases where it is the lessee. Significant judgments and assumptions are inherent in not only determining if a contract contains a lease, but also the lease classification, terms, payments, and, if needed, discount rates. Judgments include the nature of any options, including if they |
Revenue Recognition | Revenue Recognition Rental and other property income is primarily derived from fixed contractual payments from operating leases, and therefore, is generally recognized on a straight-line basis over the term of the lease, which typically begins the date the tenant takes control of the space. When the Company acquires a property, the terms of existing leases are considered to commence as of the acquisition date for the purpose of this calculation. Variable rental and other property income consists primarily of tenant reimbursements for recoverable real estate taxes and operating expenses which are included in rental and other property income in the period when such costs are incurred, with offsetting expenses in real estate taxes and property operating expenses, respectively, within the condensed consolidated statements of operations. The Company defers the recognition of variable rental and other property income, such as percentage rents, until the specific target that triggers the contingent rental income is achieved. |
Earnings (Loss) and Distributions Per Share | Earnings (Loss) and Distributions Per Share The Company has four classes of common stock with nonforfeitable dividend rights that are determined based on a different NAV for each class. Accordingly, the Company utilizes the two-class method to determine its earnings per share, which can result in different earnings per share for each of the classes. Under the two-class method, earnings per share of each class of common stock are computed by dividing the sum of the distributed earnings to common stockholders and undistributed earnings allocated to common stockholders by the weighted average number of shares for each class of common stock for the respective period. Diluted income per share, when applicable, considers the effect of any potentially dilutive share equivalents, of which the Company had none for each of the three months ended March 31, 2021 or 2020. Distributions per share are calculated based on the authorized monthly distribution rate. Prior to April 1, 2020, distributions were calculated based on the authorized daily distribution rate. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements From time to time, new accounting pronouncements are issued by various standard setting bodies that may have an impact on the Company’s accounting and reporting. Except as otherwise stated below, the Company is currently evaluating the effect that certain new accounting requirements may have on the Company’s accounting and related reporting and disclosures in the Company’s condensed consolidated financial statements. In January 2021, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2021-01, Reference Rate Reform (Topic 848) (“ASU 2021-01”). The amendments in ASU 2021-01 clarify that certain optional expedients and exceptions for contract modifications and hedge accounting apply to derivative instruments that use an interest rate for margining, discounting, or contract price alignment that is modified as a result of the discontinuation of the use of LIBOR as a benchmark interest rate due to reference rate reform. ASU 2021-01 is effective immediately for all entities with the option to apply retrospectively as of any date from the beginning of an interim period that includes or is subsequent to March 12, 2020, and can be applied prospectively to any new contract modifications made on or after January 7, 2021. The Company currently uses the London Interbank Offered Rate (the “LIBOR”) as its benchmark interest rate for its derivative instruments, and has not entered into any new contracts on or after the effective date of ASU 2021-01. The Company adopted this ASU during the first quarter of fiscal year 2021, and has concluded that there is no material impact on its condensed consolidated financial statements. In April 2020, the FASB issued a question and answer document (the “Lease Modification Q&A”) focused on the application of lease accounting guidance to lease concessions provided as a result of the COVID-19 pandemic. Due to the business disruptions and challenges severely affecting the global economy caused by the COVID-19 pandemic, many lessors may be required to provide rent deferrals and other lease concessions to lessees. While the lease modification guidance in ASC 842 addresses routine changes to lease terms resulting from negotiations between the lessee and the lessor, this guidance did not contemplate concessions being so rapidly executed to address the sudden liquidity constraints of some lessees arising from COVID-19 related impacts. Under existing lease guidance, the Company would have to determine, on a lease by lease basis, if a lease concession was the result of a new arrangement reached with the tenant (treated within the lease modification accounting framework) or if a lease concession was under the enforceable rights and obligations within the existing lease agreement (precluded from applying the lease modification accounting framework). The Lease Modification Q&A allows the Company, if certain criteria have been met, to bypass the lease by lease analysis, and instead elect to either apply the lease modification accounting framework or not, with such election applied consistently to leases with similar characteristics and similar circumstances. The Company has elected to apply this guidance to avoid performing a lease by lease analysis for the lease concessions that (1) were granted as relief due to COVID-19 related impacts and (2) result in the cash flows remaining substantially the same or less than the original contract and will account for these lease concessions as if no changes were made to the leases. During the three months ended March 31, 2021, the Company provided lease concessions in the form of rent abatements to certain tenants in response to the impact of the COVID-19 pandemic on those tenants. During the three months ending March 31, 2021, the Company granted rental abatements of $217,000. |
Fair Value Measurements | Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions. Depending on the nature of the asset or liability, various techniques and assumptions can be used to estimate the fair value. Assets and liabilities are measured using inputs from three levels of the fair value hierarchy, as follows: Level 1 — Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. An active market is defined as a market in which transactions for the assets or liabilities occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2 — Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active (markets with few transactions), inputs other than quoted prices that are observable for the asset or liability (i.e., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data correlation or other means (market corroborated inputs). Level 3 — Unobservable inputs, which are only used to the extent that observable inputs are not available, reflect the Company’s assumptions about the pricing of an asset or liability. |
Fair Value of Financial Instruments | The following describes the methods the Company uses to estimate the fair value of the Company’s financial assets and liabilities:Credit facility and notes payable — The fair value is estimated by discounting the expected cash flows based on estimated borrowing rates available to the Company as of the measurement date. Current and prior period liabilities’ carrying and fair values exclude net deferred financing costs. These financial instruments are valued using Level 2 inputs. Marketable securities — The Company’s marketable securities are carried at fair value and are valued using Level 1 inputs. The estimated fair value of the Company’s marketable securities are based on quoted market prices that are readily and regularly available in an active market. Derivative instruments — The Company’s derivative instruments are comprised of interest rate swaps. All derivative instruments are carried at fair value and are valued using Level 2 inputs. The fair value of these instruments is determined using interest rate market pricing models. In addition, credit valuation adjustments are incorporated into the fair values to account for the Company’s potential nonperformance risk and the performance risk of the respective counterparties. Although the Company has determined that the majority of the inputs used to value its derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with those derivatives utilize Level 3 inputs, such as estimates of current credit spreads, to evaluate the likelihood of default by the Company and its counterparties. However, as of March 31, 2021 and December 31, 2020, the Company assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions and determined that the credit valuation adjustments are not significant to the overall valuation of the Company’s derivatives. As a result, t he Company has determined that its derivative valuations in their entirety are classified in Level 2 of the fair value hierarchy. Other financial instruments — The Company considers the carrying values of its cash and cash equivalents, restricted cash, tenant receivables, accrued expenses and accounts payable , other liabilities, due to affiliates and distributions payable to approximate their fair values because of the short period of time between their origination and their expected realization as well as their highly-liquid nature. Due to the short-term maturities of these instruments, Level 1 inputs are utilized to estimate the fair value of these financial instruments. |
Environmental Matters | Environmental Matters In connection with the ownership and operation of real estate, the Company may potentially be liable for costs and damages related to environmental matters. In addition, the Company may own or acquire certain properties that are subject to environmental remediation. Generally, the seller of the property, the tenant of the property and/or another third party is responsible for environmental remediation costs related to a property. Additionally, in connection with the purchase of certain properties, the respective sellers and/or tenants may agree to indemnify the Company against future remediation costs. The Company also carries environmental liability insurance on its properties that provides limited coverage for any remediation liability and/or pollution liability for third-party bodily injury and/or property damage claims for which the Company may be liable. The Company is not aware of any environmental matters which it believes are reasonably likely to have a material effect on its results of operations, financial condition or liquidity. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Schedule of Investment in and valuation of real estate and related assets | The estimated useful lives of the Company’s real estate assets by class are generally as follows: Buildings 40 years Site improvements 15 years Tenant improvements Lesser of useful life or lease term Intangible lease assets Lease term |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Schedule of fair value of company's financial assets and liabilities | In accordance with the fair value hierarchy described above, the following tables show the fair value of the Company’s financial assets and liabilities that are required to be measured at fair value on a recurring basis as of March 31, 2021 and December 31, 2020 (in thousands): Balance as of Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant March 31, 2021 (Level 1) (Level 2) (Level 3) Financial assets: Marketable securities $ 15,062 $ 15,062 $ — $ — Financial liabilities: Interest rate swaps $ (6,996) $ — $ (6,996) $ — Balance as of Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant December 31, 2020 (Level 1) (Level 2) (Level 3) Financial assets: Marketable securities $ 15,496 $ 15,496 $ — $ — Financial liabilities: Interest rate swaps $ (8,509) $ — $ (8,509) $ — |
Schedule of real estate impairment charges | The following summarizes the ranges of discount rates and terminal capitalization rates used for the Company’s impairment test for the real estate assets during the three months ended March 31, 2020 : Three Months Ended March 31, 2020 Discount Rate Terminal Capitalization Rate 9.7% 9.2% The following table presents the impairment charges by asset class recorded during the three months ended March 31, 2020 (in thousands): Three Months Ended March 31, 2020 Asset class impaired: Land $ 964 Buildings and improvements 3,454 Intangible lease assets 1,269 Intangible lease liabilities (1) Total impairment loss $ 5,686 |
INTANGIBLE LEASE ASSETS AND L_2
INTANGIBLE LEASE ASSETS AND LIABILITIES (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of finite-lived intangible assets | Intangible lease assets and liabilities consisted of the following as of March 31, 2021 and December 31, 2020 (in thousands, except weighted average life remaining): March 31, 2021 December 31, 2020 Intangible lease assets: In-place leases and other intangibles, net of accumulated amortization of $29,854 and $27,966, respectively (with a weighted average life remaining of 9.6 years and 9.8 years, respectively) $ 63,345 $ 65,157 Acquired above-market leases, net of accumulated amortization of $4,190 and $3,938, respectively (with a weighted average life remaining of 11.2 years and 11.4 years, respectively) 9,426 9,678 Total intangible lease assets, net $ 72,771 $ 74,835 Intangible lease liabilities: Acquired below-market leases, net of accumulated amortization of $5,058 and $4,734, respectively (with a weighted average life remaining of 10.0 years and 10.2 years, respectively) $ 11,716 $ 12,040 |
Schedule of amortization expense of below market lease | The following table summarizes the amortization related to the intangible lease assets and liabilities for the three months ended March 31, 2021 and 2020 (in thousands): Three Months Ended March 31, 2021 2020 In-place lease and other intangible amortization $ 1,888 $ 2,029 Above-market lease amortization $ 252 $ 257 Below-market lease amortization $ 324 $ 353 |
Schedule of finite-lived intangible assets amortization expense | The following table summarizes the amortization related to the intangible lease assets and liabilities for the three months ended March 31, 2021 and 2020 (in thousands): Three Months Ended March 31, 2021 2020 In-place lease and other intangible amortization $ 1,888 $ 2,029 Above-market lease amortization $ 252 $ 257 Below-market lease amortization $ 324 $ 353 |
Schedule of finite-lived intangible liabilities, future amortization expense | As of March 31, 2021, the estimated amortization relating to the intangible lease assets and liabilities is as follows (in thousands): Amortization In-Place Leases and Other Intangibles Above-Market Leases Below-Market Leases Remainder of 2021 $ 5,650 $ 754 $ 913 2022 7,497 1,005 1,213 2023 7,342 1,004 1,203 2024 6,975 943 1,140 2025 6,330 882 1,109 Thereafter 29,551 4,838 6,138 Total $ 63,345 $ 9,426 $ 11,716 |
Schedule of finite-lived intangible assets, future amortization expense | As of March 31, 2021, the estimated amortization relating to the intangible lease assets and liabilities is as follows (in thousands): Amortization In-Place Leases and Other Intangibles Above-Market Leases Below-Market Leases Remainder of 2021 $ 5,650 $ 754 $ 913 2022 7,497 1,005 1,213 2023 7,342 1,004 1,203 2024 6,975 943 1,140 2025 6,330 882 1,109 Thereafter 29,551 4,838 6,138 Total $ 63,345 $ 9,426 $ 11,716 |
MARKETABLE SECURITIES (Tables)
MARKETABLE SECURITIES (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of available-for-sale securities | The following is a summary of the Company’s available-for-sale securities as of March 31, 2021 (in thousands): Available-for-sale securities Amortized Cost Basis Unrealized Fair Value U.S. Treasury Bonds $ 5,932 $ 101 $ 6,033 U.S. Agency Bonds 1,902 21 1,923 Corporate Bonds 6,840 266 7,106 Total available-for-sale securities $ 14,674 $ 388 $ 15,062 |
Schedule of available-for-sale securities reconciliation | The following table provides the activity for the marketable securities during the three months ended March 31, 2021 (in thousands): Amortized Cost Basis Unrealized Gain (Loss) Fair Value Marketable securities as of January 1, 2021 $ 14,755 $ 741 $ 15,496 Face value of marketable securities acquired 2,888 — 2,888 Premiums and discounts on purchase of marketable securities, net of acquisition costs 66 — 66 Amortization on marketable securities (22) — (22) Sales and maturities of securities (3,013) 15 (2,998) Unrealized loss on marketable securities — (368) (368) Marketable securities as of March 31, 2021 $ 14,674 $ 388 $ 15,062 |
Schedule of investments classified by contractual maturity date | The scheduled maturities of the Company’s marketable securities as of March 31, 2021 are as follows (in thousands): Available-for-sale securities Amortized Cost Estimated Fair Value Due within one year $ 1,256 $ 1,269 Due after one year through five years 6,805 7,080 Due after five years through ten years 4,738 4,819 Due after ten years 1,875 1,894 Total $ 14,674 $ 15,062 |
DERIVATIVE INSTRUMENTS AND HE_2
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of derivative instruments | The following table summarizes the terms of the Company’s executed interest rate swap agreements designated as hedging instruments as of March 31, 2021 and December 31, 2020 (dollar amounts in thousands): Outstanding Notional Amount as of Interest Effective Maturity Fair Value of Liabilities as of Balance Sheet Location March 31, 2021 Rate (1) Date Date March 31, 2021 December 31, 2020 Interest Rate Swaps Derivative liabilities, deferred rental income and other liabilities $ 281,465 3.46% to 4.99% 12/16/2016 to 9/30/2019 9/30/2021 to 9/6/2022 $ (6,996) $ (8,509) ______________________ (1) The interest rates consist of the underlying index swapped to a fixed rate and the applicable interest rate spread as of March 31, 2021. |
CREDIT FACILITY AND NOTES PAY_2
CREDIT FACILITY AND NOTES PAYABLE (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Summary of debt activity | The following table summarizes the debt balances as of March 31, 2021 and December 31, 2020, and the debt activity for the three months ended March 31, 2021 (in thousands): During the Three Months Ended March 31, 2021 Balance as of Debt Issuance, Net (1) Repayments Amortization Balance as of Credit facility $ 321,500 $ 5,000 $ — $ — $ 326,500 Notes payable – fixed rate debt 129,219 — — — 129,219 Total debt 450,719 5,000 — — 455,719 Deferred costs – credit facility (2) (645) — — 94 (551) Deferred costs – fixed rate debt (696) — — 66 (630) Total debt, net $ 449,378 $ 5,000 $ — $ 160 $ 454,538 ______________________ (1) Includes deferred financing costs incurred during the period, if applicable. (2) Deferred costs are related to the term portion of the credit facility. |
Schedule of maturities of long-term debt | The following table summarizes the scheduled aggregate principal repayments for the Company’s outstanding debt subsequent to March 31, 2021 (in thousands): Principal Repayments Remainder of 2021 $ 134,442 2022 304,327 2023 — 2024 — 2025 16,950 Thereafter — Total $ 455,719 |
SUPPLEMENTAL CASH FLOW DISCLO_2
SUPPLEMENTAL CASH FLOW DISCLOSURES (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Supplemental Cash Flow Elements [Abstract] | |
Schedule of supplemental cash flow disclosure | Supplemental cash flow disclosures for the three months ended March 31, 2021 and 2020 are as follows (in thousands): Three Months Ended March 31, 2021 2020 Supplemental Disclosures of Non-Cash Investing and Financing Activities: Change in accrued dealer manager fees, ongoing stockholder servicing fees, and other offering costs $ 155 $ 92 Distributions to stockholders declared and unpaid $ 2,328 $ 2,718 Common stock issued through distribution reinvestment plan $ 4,274 $ 4,011 Redemptions to stockholders declared and unpaid $ 1,952 $ — Change in fair value of marketable securities $ (353) $ 149 Change in fair value of interest rate swaps $ 1,513 $ (7,196) Supplemental Cash Flow Disclosures: Interest paid $ 4,144 $ 3,491 Cash paid for taxes $ 24 $ 22 |
RELATED-PARTY TRANSACTIONS AN_2
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Related Party Transactions [Abstract] | |
Schedule of related party transactions | In connection with the Offering, CCO Capital, the Company’s dealer manager, will receive upfront selling commissions and dealer manager fees, and/or asset-based stockholder servicing fees, as summarized in the table below for each class of common stock: Upfront Selling Commissions Dealer Manager Fees Ongoing Stockholder Servicing Fees (2) D Shares (1) — % — % 0.25 % T Shares (1) 3.00 % 0.50 % 0.85 % S Shares (1) 3.50 % — % 0.85 % I Shares — % — % — % ______________________ (1) The upfront selling commissions are based on a percentage of the transaction price, which is exclusive of the upfront selling commission for T Shares and S Shares. Prior to February 28, 2020, there was a 1.50% upfront selling commission payable on D Shares. Effective February 28, 2020, there are no upfront selling commissions or dealer manager fees payable on D Shares. The dealer manager fee for T Shares is based on a percentage of the transaction price for T Shares. Upfront selling commissions and dealer manager fees are deducted directly from the offering price for T Shares and S Shares and paid to CCO Capital. The Company has been advised that CCO Capital intends to reallow 100% of the upfront selling commissions on T Shares and S Shares to participating broker-dealers and may reallow a portion of the dealer manager fee. (2) The stockholder servicing fees are calculated as a percentage of the NAV per D Share, T Share or S Share, as applicable, and are paid monthly in arrears. CCO Capital, in its sole discretion, may reallow a portion of the stockholder servicing fees to participating broker-dealers. The Company will cease paying the stockholder servicing fees with respect to any D Shares, T Shares or S Shares held in a stockholder’s account when the total upfront selling commissions, dealer manager fees and stockholder servicing fees would exceed, in the aggregate, 8.75% (or, in the case of shares sold through certain participating broker-dealers, a lower limit as set forth in any applicable agreement between the Company’s dealer manager and a participating broker-dealer) of the gross proceeds from the sale of such shares. The Company incurred commissions, fees and expense reimbursements as shown in the table below for services provided by CIM Income NAV Management and its affiliates related to the services described above during the periods indicated (in thousands): Three Months Ended March 31, 2021 2020 Upfront selling commissions $ 4 $ 323 Stockholder servicing fees (1) $ 607 $ 633 Dealer manager fees (1) $ 1 $ 56 Organization and offering expense reimbursement $ 36 $ 149 Acquisition expense reimbursement $ 212 $ 89 Advisory fee $ 1,497 $ 1,740 Operating expense reimbursement $ 372 $ 166 ______________________ (1) Amounts are calculated for the respective period in accordance with the dealer manager agreement and exclude the estimated liability for the future fees payable to CCO Capital of $11.4 million and $13.3 million as of March 31, 2021 and 2020, respectively, which are included in due to affiliates in the condensed consolidated balance sheets, with a corresponding decrease to capital in excess of par value, as described in Note 2 — Summary of Significant Accounting Policies. |
STOCKHOLDERS_ EQUITY (Tables)
STOCKHOLDERS’ EQUITY (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Equity [Abstract] | |
Schedule of issuances and redemptions of common stock | The table below provides information regarding the issuances and redemptions of each class of the Company’s common stock during the three months ended March 31, 2021 and 2020 (dollar amounts in thousands): D Shares T Shares S Shares I Shares Total Shares Par Value Shares Par Value Shares Par Value Shares Par Value Shares Par Value Balance as of January 1, 2021 15,318,506 $ 153 13,778,134 $ 138 7,399 $ — 1,011,342 $ 10 30,115,381 $ 301 Issuance of common stock 146,827 2 136,249 1 141 — 7,036 — 290,253 3 Redemptions of common stock (364,171) (4) (232,939) (2) — — (5,867) — (602,977) (6) Equity-based compensation 2,923 — — — — — — — 2,923 — Equity-based payments to Advisor — — — — — — 32,775 — 32,775 — Balance as of March 31, 2021 15,104,085 $ 151 13,681,444 $ 137 7,540 $ — 1,045,286 $ 10 29,838,355 $ 298 D Shares T Shares S Shares I Shares Total Shares Par Value Shares Par Value Shares Par Value Shares Par Value Shares Par Value Balance as of January 1, 2020 18,143,147 $ 181 14,499,636 $ 145 7,031 $ — 1,097,896 $ 11 33,747,710 $ 337 Issuance of common stock 356,188 4 752,814 7 98 — 21,964 — 1,131,064 11 Redemptions of common stock (1,657,375) (17) (830,138) (8) — — (166,073) (1) (2,653,586) (26) Balance as of March 31, 2020 16,841,960 $ 168 14,422,312 $ 144 7,129 $ — 953,787 $ 10 32,225,188 $ 322 |
LEASES (Tables)
LEASES (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Leases [Abstract] | |
Schedule of future minimum rental payments for operating leases | As of March 31, 2021, the future minimum rental income from the Company’s real estate assets under non-cancelable operating leases, assuming no exercise of renewal options for the succeeding five fiscal years and thereafter, was as follows (in thousands): Future Minimum Rental Income Remainder of 2021 $ 46,885 2022 62,714 2023 62,728 2024 61,335 2025 57,498 Thereafter 335,279 Total $ 626,439 |
Schedule of rental and other property income | Rental and other property income during the three months ended March 31, 2021 and 2020 consisted of the following (in thousands): Three Months Ended March 31, 2021 2020 Fixed rental and other property income (1) $ 16,292 $ 16,161 Variable rental and other property income (2) 2,406 2,427 Total rental and other property income $ 18,698 $ 18,588 ______________________ (1) Consists primarily of fixed contractual payments from operating leases with tenants recognized on a straight-line basis over the lease term, including amortization of acquired above- and below-market leases, and is net of uncollectible lease-related receivables. |
ORGANIZATION AND BUSINESS (Narr
ORGANIZATION AND BUSINESS (Narrative) (Details) $ / shares in Units, ft² in Millions | 3 Months Ended | ||||||
Mar. 31, 2021USD ($)ft²class_of_stockstateproperty$ / sharesshares | Mar. 31, 2020USD ($) | Dec. 31, 2020shares | Aug. 07, 2020USD ($) | Feb. 10, 2017USD ($) | Aug. 26, 2013USD ($) | Dec. 06, 2011USD ($) | |
Organization and business | |||||||
Proceeds from issuance of common stock | $ 561,000 | $ 16,124,000 | |||||
D Shares | |||||||
Organization and business | |||||||
Shares issued (in shares) | shares | 15,104,085 | 15,318,506 | |||||
Net asset value per share (in dollars per share) | $ / shares | $ 16.35 | ||||||
T Shares | |||||||
Organization and business | |||||||
Shares issued (in shares) | shares | 13,681,444 | 13,778,134 | |||||
Net asset value per share (in dollars per share) | $ / shares | $ 15.91 | ||||||
S Shares | |||||||
Organization and business | |||||||
Shares issued (in shares) | shares | 7,540 | 7,399 | |||||
Net asset value per share (in dollars per share) | $ / shares | $ 15.89 | ||||||
I Shares | |||||||
Organization and business | |||||||
Shares issued (in shares) | shares | 1,045,286 | 1,011,342 | |||||
Net asset value per share (in dollars per share) | $ / shares | $ 16.65 | ||||||
IPO | |||||||
Organization and business | |||||||
Common stock, value authorized | $ 4,000,000,000 | $ 4,000,000,000 | |||||
Classes of common stock, number of additions | class_of_stock | 2 | ||||||
IPO | Common Stock | |||||||
Organization and business | |||||||
Shares issued (in shares) | shares | 49,000,000 | ||||||
Proceeds from issuance of common stock | $ 883,000,000 | ||||||
Offering costs, selling commissions and dealer manager fees | 26,800,000 | ||||||
Dealer manager and distribution fees | $ 6,500,000 | ||||||
Multi-class offering | |||||||
Organization and business | |||||||
Common stock, value authorized | $ 4,000,000,000 | $ 4,000,000,000 | |||||
Primary Offering | |||||||
Organization and business | |||||||
Common stock, value authorized | 3,500,000,000 | 3,500,000,000 | 3,500,000,000 | 3,500,000,000 | |||
Distribution Reinvestment Plan | |||||||
Organization and business | |||||||
Common stock, value authorized | $ 500,000,000 | $ 500,000,000 | $ 500,000,000 | $ 500,000,000 | |||
DRIP | Common Stock | |||||||
Organization and business | |||||||
Shares issued (in shares) | shares | 4,000,000 | ||||||
CIM Income NAV OP | |||||||
Organization and business | |||||||
General partner partnership interest percentage (percentage) | 100.00% | ||||||
Consolidated properties | |||||||
Organization and business | |||||||
Number of owned properties | property | 122 | ||||||
Rentable square feet (in square feet) | ft² | 5.3 | ||||||
Number of states in which entity owns properties | state | 33 | ||||||
Percentage of rentable space leased | 98.70% | ||||||
Consolidated properties | Consolidated joint venture | |||||||
Organization and business | |||||||
Number of owned properties | property | 2 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Reclassification) (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Accounting Policies [Abstract] | |
Write-off of uncollectible lease-related receivables | $ 158 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Real Estate) (Details) | 3 Months Ended | ||
Mar. 31, 2021USD ($) | Mar. 31, 2020USD ($)property | Dec. 31, 2020USD ($)property | |
Real Estate Properties | |||
Real estate impairment | $ 0 | $ 5,686,000 | |
Total impairment loss | $ 5,686,000 | ||
Real estate property held for sale | $ 0 | ||
Number of real estate properties | property | 1 | ||
Real Estate | |||
Real Estate Properties | |||
Assets Held for Sale | $ 1,000,000 | ||
Buildings | |||
Real Estate Properties | |||
Acquired real estate asset, useful life (years) | 40 years | ||
Site improvements | |||
Real Estate Properties | |||
Acquired real estate asset, useful life (years) | 15 years | ||
Anchored Shopping Center | |||
Real Estate Properties | |||
Number of real estate properties impaired | property | 1 | ||
Retail Site | |||
Real Estate Properties | |||
Number of real estate properties impaired | property | 1 |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Investment in CIM UII Onshore) (Details) - USD ($) $ in Thousands | Sep. 27, 2019 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 |
Schedule of Equity Method Investments | ||||
Carrying value | $ 47,640 | $ 46,680 | ||
Gain on investment in CIM UII Onshore | 1,332 | $ 0 | ||
Distributions of capital from investment in CIM UII Onshore | 372 | $ 0 | ||
CIM UII Onshore | ||||
Schedule of Equity Method Investments | ||||
Payments to acquire investments | $ 50,000 | 49,000 | ||
Carrying value | $ 47,600 | |||
Ownership percent (percentage) | 5.00% | |||
Distributions of capital from investment in CIM UII Onshore | $ 372 |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Noncontrolling Interest in Consolidated Joint Venture) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Accounting Policies [Abstract] | |||
Net income allocated to noncontrolling interest | $ 9 | $ 4 | |
Payments to noncontrolling interests | 15 | ||
Non-controlling interests | $ 701 | $ 707 |
SUMMARY OF SIGNIFICANT ACCOUN_8
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Restricted Cash) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 |
Restricted Cash and Cash Equivalents | |||
Restricted cash | $ 405 | $ 415 | $ 472 |
Lockbox Accounts | |||
Restricted Cash and Cash Equivalents | |||
Restricted cash | 123 | 134 | |
Escrow Deposits | |||
Restricted Cash and Cash Equivalents | |||
Restricted cash | $ 282 | $ 281 |
SUMMARY OF SIGNIFICANT ACCOUN_9
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Stockholder Servicing Fees) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 |
Related Party Transaction | |||
Due to affiliates | $ 13,577 | $ 13,826 | |
D Shares | |||
Related Party Transaction | |||
Daily asset based related party fee percent | 0.00068% | ||
T Shares | |||
Related Party Transaction | |||
Daily asset based related party fee percent | 0.00233% | ||
S Shares | |||
Related Party Transaction | |||
Daily asset based related party fee percent | 0.00233% | ||
Dealer manager | |||
Related Party Transaction | |||
Due to affiliates | $ 11,400 | $ 11,900 | $ 13,300 |
SUMMARY OF SIGNIFICANT ACCOU_10
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Revenue Recognition) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Accounting Policies [Abstract] | ||
Decrease in receivable, allowance for loss | $ (992) | $ (1,200) |
SUMMARY OF SIGNIFICANT ACCOU_11
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Earnings (Loss) and Distributions Per Share) (Details) | 3 Months Ended | |
Mar. 31, 2021class_of_stockshares | Mar. 31, 2020shares | |
Earnings (Loss) Per Share | ||
Weighted average number diluted shares outstanding adjustment (in shares) | shares | 0 | 0 |
Multi-class offering | ||
Earnings (Loss) Per Share | ||
Classes of common stock, number | class_of_stock | 4 |
SUMMARY OF SIGNIFICANT ACCOU_12
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Other) (Details) - USD ($) $ in Thousands | May 06, 2021 | Mar. 31, 2021 |
Unusual or Infrequent Item, or Both [Line Items] | ||
Additional granted rental abatements | $ 217 | |
Subsequent Event | ||
Unusual or Infrequent Item, or Both [Line Items] | ||
Percent of rental payments collected (percentage) | 99.00% |
FAIR VALUE MEASUREMENTS (Narrat
FAIR VALUE MEASUREMENTS (Narrative) (Details) | 3 Months Ended | ||
Mar. 31, 2021USD ($) | Mar. 31, 2020USD ($)property | Dec. 31, 2020USD ($) | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |||
Real estate impairment | $ 0 | $ 5,686,000 | |
Anchored Shopping Center | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |||
Number of real estate properties impaired | property | 1 | ||
Retail Site | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |||
Number of real estate properties impaired | property | 1 | ||
Fair value | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |||
Carrying value of impaired property | $ 8,300,000 | ||
Carrying value | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |||
Debt outstanding | 455,700,000 | $ 450,700,000 | |
Carrying value of impaired property | 9,200,000 | ||
Carrying value | Retail Site | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |||
Carrying value of impaired property | $ 4,800,000 | ||
Significant Other Observable Inputs (Level 2) | Fair value | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |||
Debt outstanding | $ 455,800,000 | $ 451,000,000 |
FAIR VALUE MEASUREMENTS (Items
FAIR VALUE MEASUREMENTS (Items Measured at Fair Value On Recurring Basis) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Financial assets: | ||
Marketable securities | $ 15,062 | $ 15,496 |
Recurring | ||
Financial assets: | ||
Marketable securities | 15,062 | 15,496 |
Financial liabilities: | ||
Interest rate swaps | (6,996) | (8,509) |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Recurring | ||
Financial assets: | ||
Marketable securities | 15,062 | 15,496 |
Financial liabilities: | ||
Interest rate swaps | 0 | 0 |
Significant Other Observable Inputs (Level 2) | Recurring | ||
Financial assets: | ||
Marketable securities | 0 | 0 |
Financial liabilities: | ||
Interest rate swaps | (6,996) | (8,509) |
Significant Unobservable Inputs (Level 3) | Recurring | ||
Financial assets: | ||
Marketable securities | 0 | 0 |
Financial liabilities: | ||
Interest rate swaps | $ 0 | $ 0 |
FAIR VALUE MEASUREMENTS (Real E
FAIR VALUE MEASUREMENTS (Real Estate Impairment Charges) (Details) | 3 Months Ended | |
Mar. 31, 2021USD ($) | Mar. 31, 2020USD ($) | |
Asset class impaired: | ||
Impairment of real estate assets | $ 0 | $ 5,686,000 |
Intangible lease liabilities | (1,000) | |
Total impairment loss | $ 5,686,000 | |
Discount Rate | ||
Asset class impaired: | ||
Real estate assets, measurement input | 0.097 | |
Terminal Capitalization Rate | ||
Asset class impaired: | ||
Real estate assets, measurement input | 0.092 | |
Land | ||
Asset class impaired: | ||
Impairment of real estate assets | $ 964,000 | |
Buildings and improvements | ||
Asset class impaired: | ||
Impairment of real estate assets | 3,454,000 | |
Intangible lease assets | ||
Asset class impaired: | ||
Impairment of real estate assets | $ 1,269,000 |
REAL ESTATE ASSETS (Property Ac
REAL ESTATE ASSETS (Property Acquisitions Narrative) (Details) - property | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Real Estate [Abstract] | ||
Number of properties acquired through business combinations and asset acquisitions in the period | 0 | 0 |
REAL ESTATE ASSETS (Property Di
REAL ESTATE ASSETS (Property Disposition) (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021USD ($)property | Mar. 31, 2020USD ($)property | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations | ||
Gross sale price | $ 1,100 | $ 5,000 |
Net proceeds from disposition of real estate assets | 1,019 | 4,789 |
Gain on disposition of real estate, net | $ 10 | $ 0 |
Anchored Shopping Center | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations | ||
Number of properties sold | property | 1 | |
Retail Site | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations | ||
Number of properties sold | property | 1 |
REAL ESTATE ASSETS (Impairment
REAL ESTATE ASSETS (Impairment of a Property) (Details) ft² in Thousands | 3 Months Ended | |
Mar. 31, 2021USD ($) | Mar. 31, 2020USD ($)ft²property | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Area of real estate property impaired | ft² | 60 | |
Real estate impairment | $ 0 | $ 5,686,000 |
Carrying value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Carrying value of impaired property | 9,200,000 | |
Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Carrying value of impaired property | $ 8,300,000 | |
Retail Site | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Number of impaired properties | property | 1 | |
Area of real estate property impaired | ft² | 30 | |
Retail Site | Carrying value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Carrying value of impaired property | $ 4,800,000 |
REAL ESTATE ASSETS (Consolidate
REAL ESTATE ASSETS (Consolidated Joint Venture) (Details) | Mar. 31, 2021USD ($)property | Dec. 31, 2020USD ($) |
Business Acquisition | ||
Assets | $ 858,374,000 | $ 866,219,000 |
Total real estate investments, net | 769,706,000 | 776,582,000 |
Intangible leased assets | 72,771,000 | 74,835,000 |
Liabilities | 497,110,000 | 497,905,000 |
Long-term debt, including net deferred financing costs | 454,538,000 | $ 449,378,000 |
Consolidated joint venture | ||
Business Acquisition | ||
Assets | 7,000,000 | |
Total real estate investments, net | 7,200,000 | |
Intangible leased assets | 641,000 | |
Accumulated depreciation, depletion and amortization, property, plant, and equipment | 981,000 | |
Liabilities | 134,000 | |
Long-term debt, including net deferred financing costs | $ 0 | |
Consolidated properties | ||
Business Acquisition | ||
Number of owned properties | property | 122 | |
Consolidated properties | Consolidated joint venture | ||
Business Acquisition | ||
Number of owned properties | property | 2 |
INTANGIBLE LEASE ASSETS AND L_3
INTANGIBLE LEASE ASSETS AND LIABILITIES (Schedule of Intangible Assets and Liabilities) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
Finite-Lived Intangible Assets | ||
Intangible leased assets | $ 72,771 | $ 74,835 |
Below market leases net of amortization | 11,716 | 12,040 |
Below market lease, accumulated amortization | $ 5,058 | $ 4,734 |
Below market lease, weighted average useful life (in years) | 10 years | 10 years 2 months 12 days |
In-Place Leases and Other Intangibles | ||
Finite-Lived Intangible Assets | ||
Intangible leased assets | $ 63,345 | $ 65,157 |
Accumulated amortization | $ 29,854 | $ 27,966 |
Useful life (in years) | 9 years 7 months 6 days | 9 years 9 months 18 days |
Above-Market Leases | ||
Finite-Lived Intangible Assets | ||
Intangible leased assets | $ 9,426 | $ 9,678 |
Accumulated amortization | $ 4,190 | $ 3,938 |
Useful life (in years) | 11 years 2 months 12 days | 11 years 4 months 24 days |
INTANGIBLE LEASE ASSETS AND L_4
INTANGIBLE LEASE ASSETS AND LIABILITIES (Amortization Expenses) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Finite-Lived Intangible Assets | ||
Below-market lease amortization | $ 324 | $ 353 |
In-place lease and other intangible | ||
Finite-Lived Intangible Assets | ||
Amortization expense | 1,888 | 2,029 |
Above-Market Leases | ||
Finite-Lived Intangible Assets | ||
Amortization expense | $ 252 | $ 257 |
INTANGIBLE LEASE ASSETS AND L_5
INTANGIBLE LEASE ASSETS AND LIABILITIES (Estimated Amortization of Intangible Lease Assets) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Amortization In-Place Leases and Other Intangibles and Above-Market Leases | ||
Total | $ 72,771 | $ 74,835 |
Amortization, Below-Market Leases | ||
Remainder of 2021 | 913 | |
2022 | 1,213 | |
2023 | 1,203 | |
2024 | 1,140 | |
2025 | 1,109 | |
Thereafter | 6,138 | |
Total | 11,716 | 12,040 |
In-Place Leases and Other Intangibles | ||
Amortization In-Place Leases and Other Intangibles and Above-Market Leases | ||
Remainder of 2021 | 5,650 | |
2022 | 7,497 | |
2023 | 7,342 | |
2024 | 6,975 | |
2025 | 6,330 | |
Thereafter | 29,551 | |
Total | 63,345 | 65,157 |
Above-Market Leases | ||
Amortization In-Place Leases and Other Intangibles and Above-Market Leases | ||
Remainder of 2021 | 754 | |
2022 | 1,005 | |
2023 | 1,004 | |
2024 | 943 | |
2025 | 882 | |
Thereafter | 4,838 | |
Total | $ 9,426 | $ 9,678 |
INVESTMENT IN CIM UII ONSHORE (
INVESTMENT IN CIM UII ONSHORE (Details) - USD ($) $ in Thousands | Sep. 27, 2019 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 |
Schedule of Equity Method Investments | ||||
Gain on investment in CIM UII Onshore | $ 1,332 | $ 0 | ||
Distributions of capital from investment in CIM UII Onshore | (372) | $ 0 | ||
Carrying value | 47,640 | $ 46,680 | ||
CIM UII Onshore | ||||
Schedule of Equity Method Investments | ||||
Payments to acquire investments | $ 50,000 | 49,000 | ||
Distributions of capital from investment in CIM UII Onshore | (372) | |||
Carrying value | $ 47,600 | |||
Ownership percent (percentage) | 5.00% |
MARKETABLE SECURITIES (Narrativ
MARKETABLE SECURITIES (Narrative) (Details) | 3 Months Ended | ||
Mar. 31, 2021USD ($)security | Mar. 31, 2020USD ($) | Dec. 31, 2020USD ($) | |
Investments, Debt and Equity Securities [Abstract] | |||
Investment in marketable securities | $ 15,062,000 | $ 15,496,000 | |
Number of securities sold | security | 19 | ||
Proceeds from sale and maturities of marketable securities | $ 2,998,000 | $ 587,000 | |
Loss on sale of marketable securities | 15,000 | ||
Unrealized gain on marketable securities | (368,000) | ||
Unrealized gain (loss) | 388,000 | $ 741,000 | |
Credit losses | $ 0 |
MARKETABLE SECURITIES (Schedule
MARKETABLE SECURITIES (Schedule of Available-for-sale Securities) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Debt Securities, Available-for-sale | ||
Amortized Cost Basis | $ 14,674 | $ 14,755 |
Unrealized Gain | 388 | 741 |
Fair Value | 15,062 | $ 15,496 |
U.S. Treasury Bonds | ||
Debt Securities, Available-for-sale | ||
Amortized Cost Basis | 5,932 | |
Unrealized Gain | 101 | |
Fair Value | 6,033 | |
U.S. Agency Bonds | ||
Debt Securities, Available-for-sale | ||
Amortized Cost Basis | 1,902 | |
Unrealized Gain | 21 | |
Fair Value | 1,923 | |
Corporate Bonds | ||
Debt Securities, Available-for-sale | ||
Amortized Cost Basis | 6,840 | |
Unrealized Gain | 266 | |
Fair Value | $ 7,106 |
MARKETABLE SECURITIES (Schedu_2
MARKETABLE SECURITIES (Schedule of Available-for-sale Securities Reconciliation) (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Amortized Cost Basis | |
Marketable securities as of January 1, 2021 | $ 14,755 |
Face value of marketable securities acquired | 2,888 |
Premiums and discounts on purchase of marketable securities, net of acquisition costs | 66 |
Amortization on marketable securities | (22) |
Sales and maturities of securities | (3,013) |
Marketable securities as of March 31, 2021 | 14,674 |
Unrealized Gain (Loss) | |
Marketable securities as of January 1, 2021 | 741 |
Sales and maturities of securities | 15 |
Unrealized loss on marketable securities | (368) |
Marketable securities as of March 31, 2021 | 388 |
Fair Value | |
Marketable securities as of January 1, 2021 | 15,496 |
Face value of marketable securities acquired | 2,888 |
Premiums and discounts on purchase of marketable securities, net of acquisition costs | 66 |
Amortization on marketable securities | (22) |
Sales and maturities of securities | (2,998) |
Unrealized loss on marketable securities | (368) |
Marketable securities as of March 31, 2021 | $ 15,062 |
MARKETABLE SECURITIES (Schedu_3
MARKETABLE SECURITIES (Schedule of Maturities) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Amortized Cost | ||
Due within one year | $ 1,256 | |
Due after one year through five years | 6,805 | |
Due after five years through ten years | 4,738 | |
Due after ten years | 1,875 | |
Amortized Cost Basis | 14,674 | $ 14,755 |
Estimated Fair Value | ||
Due within one year | 1,269 | |
Due after one year through five years | 7,080 | |
Due after five years through ten years | 4,819 | |
Due after ten years | 1,894 | |
Estimated Fair Value | $ 15,062 | $ 15,496 |
DERIVATIVE INSTRUMENTS AND HE_3
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Narrative) (Details) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021USD ($)swap_agreement | Mar. 31, 2020USD ($) | Dec. 31, 2020USD ($) | |
Derivatives, Fair Value | |||
Amount of loss reclassified from other comprehensive income (loss) into income as interest expense and other, net | $ (1,475) | $ (388) | |
Loss reported in total stockholders’ equity | $ (350,932) | $ (357,567) | |
Interest rate swaps | |||
Derivatives, Fair Value | |||
Derivative, number of instruments held | swap_agreement | 8 | ||
Termination value | $ 7,100 | ||
Cash Flow Hedging | Interest rate swaps | |||
Derivatives, Fair Value | |||
Interest rate cash flow hedge gain (loss) to be reclassified during next twelve months | 5,300 | ||
Cash Flow Hedging | Interest rate swaps | Derivative liabilities, deferred rental income and other liabilities | Designated as Hedging Instrument | |||
Derivatives, Fair Value | |||
Loss reported in total stockholders’ equity | $ 7,000 | $ 8,500 |
DERIVATIVE INSTRUMENTS AND HE_4
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Schedule of Derivative Instruments) (Details) - Designated as Hedging Instrument - Cash Flow Hedging - Interest rate swaps - Derivative liabilities, deferred rental income and other liabilities - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Derivatives, Fair Value | ||
Outstanding Notional Amount | $ 281,465 | |
Fair Value of Liabilities | $ (6,996) | $ (8,509) |
Minimum | ||
Derivatives, Fair Value | ||
Interest Rate (percentage) | 3.46% | |
Maximum | ||
Derivatives, Fair Value | ||
Interest Rate (percentage) | 4.99% |
CREDIT FACILITY AND NOTES PAY_3
CREDIT FACILITY AND NOTES PAYABLE (Fixed Rate Debt) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Debt Instrument | ||
Long-term debt, including net deferred financing costs | $ 454,538 | $ 449,378 |
Weighted average years to maturity | 1 year 2 months 12 days | |
Weighted average interest rate (percentage) | 3.64% | |
Debt outstanding | $ 455,719 | 450,719 |
Notes payable – fixed rate debt | ||
Debt Instrument | ||
Weighted average interest rate (percentage) | 3.93% | |
Debt outstanding | $ 129,219 | $ 129,219 |
Debt security, amount, aggregate gross real estate assets net of gross intangible lease liabilities | $ 228,900 | |
Notes payable – fixed rate debt | Minimum | ||
Debt Instrument | ||
Debt instrument, interest rate, stated percentage (percentage) | 3.56% | |
Notes payable – fixed rate debt | Maximum | ||
Debt Instrument | ||
Debt instrument, interest rate, stated percentage (percentage) | 4.17% | |
Interest rate swaps | Variable rate debt | ||
Debt Instrument | ||
Debt outstanding | $ 69,000 |
CREDIT FACILITY AND NOTES PAY_4
CREDIT FACILITY AND NOTES PAYABLE (Schedule of Debt) (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Debt [Roll Forward] | |
Long-term debt, gross, beginning balance | $ 450,719 |
Total debt, net, beginning of period | 449,378 |
Debt Issuance, Gross | 5,000 |
Debt Issuance, Net | 5,000 |
Repayments | 0 |
Repayments and modifications, total debt, net | 0 |
Amortization of deferred financing costs | 160 |
Long-term debt, gross, ending balance | 455,719 |
Total debt, net, ending of period | 454,538 |
Credit facility | |
Debt [Roll Forward] | |
Long-term debt, gross, beginning balance | 321,500 |
Deferred costs, beginning of period | (645) |
Debt Issuance, Gross | 5,000 |
Debt Issuance, Net, Deferred Costs | 0 |
Repayments | 0 |
Amortization | 94 |
Long-term debt, gross, ending balance | 326,500 |
Deferred costs, end of period | (551) |
Notes payable – fixed rate debt | |
Debt [Roll Forward] | |
Long-term debt, gross, beginning balance | 129,219 |
Deferred costs, beginning of period | (696) |
Debt Issuance, Gross | 0 |
Debt Issuance, Net, Deferred Costs | 0 |
Repayments | 0 |
Amortization | 66 |
Long-term debt, gross, ending balance | 129,219 |
Deferred costs, end of period | $ (630) |
CREDIT FACILITY AND NOTES PAY_5
CREDIT FACILITY AND NOTES PAYABLE (Credit Facility) (Details) | 3 Months Ended | |
Mar. 31, 2021USD ($)extension | Dec. 31, 2020USD ($) | |
Debt Instrument | ||
Notes payable and credit facility, net | $ 454,538,000 | $ 449,378,000 |
Weighted average interest rate (percentage) | 3.64% | |
Line of Credit | ||
Debt Instrument | ||
Notes payable and credit facility, net | $ 114,000,000 | |
Line of Credit | JPMorgan Chase Bank, N.A. | ||
Debt Instrument | ||
Line of credit facility, maximum borrowing capacity | 425,000,000 | |
Notes payable and credit facility, net | $ 326,500,000 | |
Weighted average interest rate (percentage) | 3.52% | |
Line of credit, remaining borrowing capacity | $ 98,500,000 | |
Line of credit facility, remaining borrowing capacity | 23,200,000 | |
Line of credit facility, covenant, minimum consolidated net worth | $ 367,100,000 | |
Line of credit facility, covenant, minimum consolidated net worth, percentage of equity issuance (percentage) | 75.00% | |
Debt Instrument, covenant, unsecured debt to unencumbered asset value ratio (less than) | 60.00% | |
Debt instrument, covenant, debt service coverage ratio (greater than) | 1.75 | |
Debt instrument, covenant, secured leverage ratio (equal to or less than) | 40.00% | |
Debt instrument, covenant, secured recourse debt coverage ratio (no greater than) | 15.00% | |
Line of Credit | JPMorgan Chase Bank, N.A. | Minimum | ||
Debt Instrument | ||
Debt instrument, covenant, fixed charge coverage ratio (equal to or greater than) | 1.50 | |
Line of Credit | JPMorgan Chase Bank, N.A. | Maximum | ||
Debt Instrument | ||
Line of credit facility, covenant, leverage ratio (less than or equal to) | 60.00% | |
Line of Credit | JPMorgan Chase Bank, N.A. | Federal Funds Effective Rate | ||
Debt Instrument | ||
Basis spread on variable rate (percentage) | 0.50% | |
Line of Credit | JPMorgan Chase Bank, N.A. | LIBOR | ||
Debt Instrument | ||
Basis spread on variable rate (percentage) | 1.00% | |
Line of Credit | Revolving Credit Facility | JPMorgan Chase Bank, N.A. | ||
Debt Instrument | ||
Line of credit facility, maximum borrowing capacity | $ 212,500,000 | |
Number of extension options | extension | 2 | |
Debt instrument, extension term | 6 months | |
Notes payable and credit facility, net | $ 114,000,000 | |
Interest rate (percentage) | 2.16% | |
Line of Credit | Revolving Credit Facility | JPMorgan Chase Bank, N.A. | Minimum | ||
Debt Instrument | ||
Debt instrument, interest rate, stated percentage (percentage) | 0.70% | |
Line of Credit | Revolving Credit Facility | JPMorgan Chase Bank, N.A. | Maximum | ||
Debt Instrument | ||
Debt instrument, interest rate, stated percentage (percentage) | 1.20% | |
Line of Credit | Revolving Credit Facility | JPMorgan Chase Bank, N.A. | Statutory Reserve Rate | Minimum | ||
Debt Instrument | ||
Basis spread on variable rate (percentage) | 1.70% | |
Line of Credit | Revolving Credit Facility | JPMorgan Chase Bank, N.A. | Statutory Reserve Rate | Maximum | ||
Debt Instrument | ||
Basis spread on variable rate (percentage) | 2.20% | |
Line of Credit | Term Loan | JPMorgan Chase Bank, N.A. | ||
Debt Instrument | ||
Line of credit facility, maximum borrowing capacity | $ 212,500,000 | |
Notes payable and credit facility, net | $ 212,500,000 | |
Line of Credit | Term Loan | JPMorgan Chase Bank, N.A. | Minimum | ||
Debt Instrument | ||
Debt instrument, interest rate, stated percentage (percentage) | 0.60% | |
Line of Credit | Term Loan | JPMorgan Chase Bank, N.A. | Maximum | ||
Debt Instrument | ||
Debt instrument, interest rate, stated percentage (percentage) | 1.10% | |
Line of Credit | Term Loan | JPMorgan Chase Bank, N.A. | Statutory Reserve Rate | Minimum | ||
Debt Instrument | ||
Basis spread on variable rate (percentage) | 1.60% | |
Line of Credit | Term Loan | JPMorgan Chase Bank, N.A. | Statutory Reserve Rate | Maximum | ||
Debt Instrument | ||
Basis spread on variable rate (percentage) | 2.10% | |
Line of Credit | Interest rate swaps | Term Loan | JPMorgan Chase Bank, N.A. | Cash Flow Hedging | ||
Debt Instrument | ||
Weighted average interest rate (percentage) | 4.25% |
CREDIT FACILITY AND NOTES PAY_6
CREDIT FACILITY AND NOTES PAYABLE (Maturities) (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021USD ($)extension | Dec. 31, 2020USD ($) | |
Debt Instrument | ||
Notes payable and credit facility, net | $ 454,538 | $ 449,378 |
Line of Credit | ||
Debt Instrument | ||
Notes payable and credit facility, net | 114,000 | |
Notes payable – fixed rate debt | ||
Debt Instrument | ||
Fixed rate debt maturing | $ 20,400 | |
Number of extensions | extension | 2 | |
Term of extensions | 6 months |
CREDIT FACILITY AND NOTES PAY_7
CREDIT FACILITY AND NOTES PAYABLE (Schedule Of Aggregate Principal Repayments) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Principal Repayments | ||
Remainder of 2021 | $ 134,442 | |
2022 | 304,327 | |
2023 | 0 | |
2024 | 0 | |
2025 | 16,950 | |
Thereafter | 0 | |
Total | $ 455,719 | $ 450,719 |
SUPPLEMENTAL CASH FLOW DISCLO_3
SUPPLEMENTAL CASH FLOW DISCLOSURES (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Supplemental Disclosures of Non-Cash Investing and Financing Activities: | ||
Change in accrued dealer manager fees, ongoing stockholder servicing fees, and other offering costs | $ 155 | $ 92 |
Distributions to stockholders declared and unpaid | 2,328 | 2,718 |
Common stock issued through distribution reinvestment plan | 4,274 | 4,011 |
Redemptions to stockholders declared and unpaid | 1,952 | 0 |
Change in fair value of marketable securities | (353) | 149 |
Change in fair value of interest rate swaps | 1,513 | (7,196) |
Supplemental Cash Flow Disclosures: | ||
Interest paid | 4,144 | 3,491 |
Cash paid for taxes | $ 24 | $ 22 |
RELATED-PARTY TRANSACTIONS AN_3
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS (Selling Commissions, Dealer Manager and Distribution Fees) (Details) - Dealer manager | Mar. 31, 2021 | Feb. 28, 2020 | Feb. 27, 2020 |
Upfront Selling Commissions | |||
Related Party Transaction | |||
Daily asset based related party fee reallowed to third party percent | 100.00% | ||
Ongoing Stockholder Servicing Fees | |||
Related Party Transaction | |||
Daily distribution and servicing fee, termination of payments threshold, percent | 8.75% | ||
D Shares | Upfront Selling Commissions | |||
Related Party Transaction | |||
Expenses from transaction with related party, percent | 0.00% | 0.00% | 1.50% |
D Shares | Dealer Manager Fees | |||
Related Party Transaction | |||
Expenses from transaction with related party, percent | 0.00% | ||
D Shares | Ongoing Stockholder Servicing Fees | |||
Related Party Transaction | |||
Expenses from transaction with related party, percent | 0.25% | ||
T Shares | Upfront Selling Commissions | |||
Related Party Transaction | |||
Expenses from transaction with related party, percent | 3.00% | ||
T Shares | Dealer Manager Fees | |||
Related Party Transaction | |||
Expenses from transaction with related party, percent | 0.50% | ||
T Shares | Ongoing Stockholder Servicing Fees | |||
Related Party Transaction | |||
Expenses from transaction with related party, percent | 0.85% | ||
S Shares | Upfront Selling Commissions | |||
Related Party Transaction | |||
Expenses from transaction with related party, percent | 3.50% | ||
S Shares | Dealer Manager Fees | |||
Related Party Transaction | |||
Expenses from transaction with related party, percent | 0.00% | ||
S Shares | Ongoing Stockholder Servicing Fees | |||
Related Party Transaction | |||
Expenses from transaction with related party, percent | 0.85% | ||
I Shares | Upfront Selling Commissions | |||
Related Party Transaction | |||
Expenses from transaction with related party, percent | 0.00% | ||
I Shares | Dealer Manager Fees | |||
Related Party Transaction | |||
Expenses from transaction with related party, percent | 0.00% | ||
I Shares | Ongoing Stockholder Servicing Fees | |||
Related Party Transaction | |||
Expenses from transaction with related party, percent | 0.00% |
RELATED-PARTY TRANSACTIONS AN_4
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS (Other Organization and Offering Expenses and Advisory Fees and Expenses) (Details) - USD ($) $ in Thousands | 3 Months Ended | 14 Months Ended | |||
Mar. 31, 2021 | Mar. 31, 2020 | Sep. 30, 2021 | Feb. 28, 2020 | Feb. 27, 2020 | |
Related Party Transaction | |||||
Issuance cost | $ 561 | $ 16,124 | |||
Advisors | Organization and offering expense reimbursement | |||||
Related Party Transaction | |||||
Organization and offering expense limit (up to) | 0.75% | ||||
D Shares | Upfront Selling Commissions | |||||
Related Party Transaction | |||||
Distribution and stockholder servicing fee, percentage of net asset value, daily accrual rate (percentage) | 0.00274% | ||||
D Shares | Dealer manager | Upfront Selling Commissions | |||||
Related Party Transaction | |||||
Expenses from transaction with related party, percent | 0.00% | 0.00% | 1.50% | ||
I Shares | Advisory fees and expenses | |||||
Related Party Transaction | |||||
Equity-based payments to advisor (in shares) | 33,000 | ||||
Issuance cost | $ 561 | ||||
I Shares | Advisors | Forecast | |||||
Related Party Transaction | |||||
Advisory fee percentage | 50.00% | ||||
I Shares | Dealer manager | Upfront Selling Commissions | |||||
Related Party Transaction | |||||
Expenses from transaction with related party, percent | 0.00% |
RELATED-PARTY TRANSACTIONS AN_5
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS (Operating Expenses and Acquisition Expenses) (Details) - Advisors | Mar. 31, 2021 |
Operating expenses | |
Related Party Transaction | |
Operating expense reimbursement percent of average invested assets (percentage) | 2.00% |
Operating expense reimbursement percent of net income (percentage) | 25.00% |
Acquisition expense reimbursement | |
Related Party Transaction | |
Acquisition and advisory fee (maximum) | 6.00% |
RELATED-PARTY TRANSACTIONS AN_6
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS (Performance Fee) (Details) - Advisors - Performance fee | Mar. 31, 2021 |
Related Party Transaction | |
Total return threshold to receive performance fee (percentage) | 12.50% |
Performance fee limit to advisor, hurdle amount, as percent of excess total return (percentage) | 5.00% |
RELATED-PARTY TRANSACTIONS AN_7
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS (Schedule of Related Party Transaction) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Related Party Transaction | |||
Due to affiliates | $ 13,577 | $ 13,826 | |
Advisors | Upfront selling commissions | |||
Related Party Transaction | |||
Related party transaction, expenses from transactions with related party | 4 | $ 323 | |
Advisors | Stockholder servicing fees | |||
Related Party Transaction | |||
Related party transaction, expenses from transactions with related party | 607 | 633 | |
Advisors | Dealer manager fees | |||
Related Party Transaction | |||
Related party transaction, expenses from transactions with related party | 1 | 56 | |
Advisors | Organization and offering expense reimbursement | |||
Related Party Transaction | |||
Related party transaction, expenses from transactions with related party | 36 | 149 | |
Advisors | Acquisition expense reimbursement | |||
Related Party Transaction | |||
Related party transaction, expenses from transactions with related party | 212 | 89 | |
Advisors | Advisory fee | |||
Related Party Transaction | |||
Related party transaction, expenses from transactions with related party | 1,497 | 1,740 | |
Advisors | Operating expense reimbursement | |||
Related Party Transaction | |||
Related party transaction, expenses from transactions with related party | 372 | 166 | |
Dealer manager | |||
Related Party Transaction | |||
Due to affiliates | $ 11,400 | $ 13,300 | $ 11,900 |
RELATED-PARTY TRANSACTIONS AN_8
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS (Due to/from Affiliates) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Related Party Transaction | ||
Due from affiliates | $ 0 | $ 7 |
Advisors | ||
Related Party Transaction | ||
Due to CIM Income NAV Advisors | $ 13,600 | 13,800 |
Due from affiliates | $ 7 |
RELATED-PARTY TRANSACTIONS AN_9
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS (CIM UII Onshore Investment) (Details) - USD ($) $ in Thousands | Sep. 27, 2019 | Mar. 31, 2021 | Dec. 31, 2020 |
Schedule of Equity Method Investments | |||
Carrying value | $ 47,640 | $ 46,680 | |
CIM UII Onshore | |||
Schedule of Equity Method Investments | |||
Payments to acquire investments | $ 50,000 | 49,000 | |
Percentage of pay on management fee | 0.65% | ||
Carrying value | 47,600 | ||
CIM UII Onshore | Advisory fee | |||
Schedule of Equity Method Investments | |||
Management fee | $ 75 |
STOCKHOLDERS' EQUITY (Issuances
STOCKHOLDERS' EQUITY (Issuances and Redemptions of Common Stock) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Increase (Decrease) in Stockholders' Equity | ||
Beginning Balance | $ 358,274 | $ 416,766 |
Issuance of common stock | 4,835 | 20,135 |
Redemptions of common stock | (9,985) | (46,684) |
Equity-based compensation | 82 | 33 |
Equity-based payments to advisor | 561 | |
Ending Balance | $ 351,633 | $ 373,669 |
D Shares | ||
Increase (Decrease) in Stockholders' Equity | ||
Beginning Balance (in shares) | 15,318,506 | |
Ending Balance (in shares) | 15,104,085 | |
T Shares | ||
Increase (Decrease) in Stockholders' Equity | ||
Beginning Balance (in shares) | 13,778,134 | |
Ending Balance (in shares) | 13,681,444 | |
S Shares | ||
Increase (Decrease) in Stockholders' Equity | ||
Beginning Balance (in shares) | 7,399 | |
Ending Balance (in shares) | 7,540 | |
I Shares | ||
Increase (Decrease) in Stockholders' Equity | ||
Beginning Balance (in shares) | 1,011,342 | |
Ending Balance (in shares) | 1,045,286 | |
Common Stock | ||
Increase (Decrease) in Stockholders' Equity | ||
Beginning Balance (in shares) | 30,115,381 | 33,747,710 |
Beginning Balance | $ 301 | $ 337 |
Issuance of common stock (in shares) | 290,253 | 1,131,064 |
Issuance of common stock | $ 3 | $ 11 |
Redemptions of common stock (in shares) | (602,977) | (2,653,586) |
Redemptions of common stock | $ (6) | $ (26) |
Equity-based compensation (in shares) | 2,923 | |
Equity-based compensation | $ 0 | |
Equity-based payments to advisor (in shares) | 32,775 | |
Equity-based payments to advisor | $ 0 | |
Ending Balance (in shares) | 29,838,355 | 32,225,188 |
Ending Balance | $ 298 | $ 322 |
Common Stock | D Shares | ||
Increase (Decrease) in Stockholders' Equity | ||
Beginning Balance (in shares) | 15,318,506 | 18,143,147 |
Beginning Balance | $ 153 | $ 181 |
Issuance of common stock (in shares) | 146,827 | 356,188 |
Issuance of common stock | $ 2 | $ 4 |
Redemptions of common stock (in shares) | (364,171) | (1,657,375) |
Redemptions of common stock | $ (4) | $ (17) |
Equity-based compensation (in shares) | 2,923 | |
Equity-based compensation | $ 0 | |
Equity-based payments to advisor (in shares) | 0 | |
Equity-based payments to advisor | $ 0 | |
Ending Balance (in shares) | 15,104,085 | 16,841,960 |
Ending Balance | $ 151 | $ 168 |
Common Stock | T Shares | ||
Increase (Decrease) in Stockholders' Equity | ||
Beginning Balance (in shares) | 13,778,134 | 14,499,636 |
Beginning Balance | $ 138 | $ 145 |
Issuance of common stock (in shares) | 136,249 | 752,814 |
Issuance of common stock | $ 1 | $ 7 |
Redemptions of common stock (in shares) | (232,939) | (830,138) |
Redemptions of common stock | $ (2) | $ (8) |
Equity-based compensation (in shares) | 0 | |
Equity-based compensation | $ 0 | |
Equity-based payments to advisor (in shares) | 0 | |
Equity-based payments to advisor | $ 0 | |
Ending Balance (in shares) | 13,681,444 | 14,422,312 |
Ending Balance | $ 137 | $ 144 |
Common Stock | S Shares | ||
Increase (Decrease) in Stockholders' Equity | ||
Beginning Balance (in shares) | 7,399 | 7,031 |
Beginning Balance | $ 0 | $ 0 |
Issuance of common stock (in shares) | 141 | 98 |
Issuance of common stock | $ 0 | $ 0 |
Redemptions of common stock (in shares) | 0 | 0 |
Redemptions of common stock | $ 0 | $ 0 |
Equity-based compensation (in shares) | 0 | |
Equity-based compensation | $ 0 | |
Equity-based payments to advisor (in shares) | 0 | |
Equity-based payments to advisor | $ 0 | |
Ending Balance (in shares) | 7,540 | 7,129 |
Ending Balance | $ 0 | $ 0 |
Common Stock | I Shares | ||
Increase (Decrease) in Stockholders' Equity | ||
Beginning Balance (in shares) | 1,011,342 | 1,097,896 |
Beginning Balance | $ 10 | $ 11 |
Issuance of common stock (in shares) | 7,036 | 21,964 |
Issuance of common stock | $ 0 | $ 0 |
Redemptions of common stock (in shares) | (5,867) | (166,073) |
Redemptions of common stock | $ 0 | $ (1) |
Equity-based compensation (in shares) | 0 | |
Equity-based compensation | $ 0 | |
Equity-based payments to advisor (in shares) | 32,775 | |
Equity-based payments to advisor | $ 0 | |
Ending Balance (in shares) | 1,045,286 | 953,787 |
Ending Balance | $ 10 | $ 10 |
STOCKHOLDERS_ EQUITY (Equity Ba
STOCKHOLDERS’ EQUITY (Equity Based Compensation) (Details) - USD ($) $ in Thousands | 3 Months Ended | 15 Months Ended | |
Mar. 31, 2021 | Sep. 30, 2021 | Aug. 09, 2018 | |
Board Of Directors | Forecast | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Percent of compensation given out in shares (percentage) | 50.00% | ||
Common Stock | CIM Income NAV, Inc. 2018 Equity Incentive Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Shares authorized (in shares) | 400,000 | ||
Shares available for grant (in shares) | 378,000 | ||
D Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Unrecognized compensation expense | $ 66 | ||
D Shares | CIM Income NAV, Inc. 2018 Equity Incentive Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Grants in period to each independent members of the board of directors (in shares) | 1,450 | ||
Total grants in period (in shares) | 5,800 | ||
D Shares | CIM Income NAV, Inc. 2018 Equity Incentive Plan | General and Administrative Expense | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Share based compensation expense | $ 49 | ||
D Shares | Restricted Shares | CIM Income NAV, Inc. 2018 Equity Incentive Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Grants in period to each independent members of the board of directors (in shares) | 5,600 | ||
Total grants in period (in shares) | 22,400 | ||
Awards vested in period (in shares) | 14,600 | ||
Period of continuous service | 1 year | ||
Nonvested shares (in shares) | 7,800 | ||
D Shares | Restricted Shares | CIM Income NAV, Inc. 2018 Equity Incentive Plan | General and Administrative Expense | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Share based compensation expense | $ 33 |
LEASES (Details)
LEASES (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Leases [Abstract] | ||
Weighted average remaining term of leases | 9 years 7 months 6 days | |
Future Minimum Rental Income | ||
Remainder of 2021 | $ 46,885 | |
2022 | 62,714 | |
2023 | 62,728 | |
2024 | 61,335 | |
2025 | 57,498 | |
Thereafter | 335,279 | |
Total | 626,439 | |
Rental and Other Property Income | ||
Fixed rental and other property income | 16,292 | $ 16,161 |
Variable rental and other property income | 2,406 | 2,427 |
Total rental and other property income | $ 18,698 | $ 18,588 |