Document And Entity Information
Document And Entity Information - shares shares in Millions | 9 Months Ended | |
Sep. 30, 2018 | Nov. 01, 2018 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 | |
Entity Registrant Name | Lightstone Value Plus Real Estate Investment Trust III, Inc. | |
Entity Central Index Key | 1,563,756 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 13.5 | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | true | |
Entity Small Business | true |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Investment property: | ||
Land and improvements | $ 22,378,686 | $ 22,363,107 |
Building and improvements | 106,002,481 | 103,807,990 |
Furniture and fixtures | 17,589,061 | 16,120,582 |
Construction in progress | 117,636 | 1,642,275 |
Gross investment property | 146,087,864 | 143,933,954 |
Less accumulated depreciation | (13,227,815) | (9,107,322) |
Net investment property | 132,860,049 | 134,826,632 |
Investments in unconsolidated affiliated real estate entities | 30,562,312 | 17,805,991 |
Cash | 10,842,438 | 45,050,023 |
Marketable securities, available for sale | 5,850,369 | 0 |
Restricted cash | 1,731,390 | 1,680,056 |
Accounts receivable and other assets | 3,289,875 | 2,111,857 |
Total Assets | 185,136,433 | 201,474,559 |
Liabilities and Stockholders' Equity | ||
Accounts payable and other accrued expenses | 3,593,514 | 2,972,368 |
Mortgages payable | 79,332,891 | 86,902,784 |
Due to related parties | 150,636 | 162,918 |
Distributions payable | 666,025 | 694,333 |
Total liabilities | 83,743,066 | 90,732,403 |
Commitments and Contingencies | ||
Company's stockholders' equity: | ||
Preferred stock, $0.01 par value; 50,000,000 shares authorized, none issued and outstanding | 0 | 0 |
Common stock, $0.01 par value; 200,000,000 shares authorized, 13,505,295 and 13,625,769 shares issued and outstanding, respectively | 135,053 | 136,258 |
Additional paid-in-capital | 115,906,888 | 117,061,644 |
Accumulated other comprehensive loss | (139,896) | 0 |
Accumulated deficit | (26,600,968) | (18,548,148) |
Total Company stockholders' equity | 89,301,077 | 98,649,754 |
Noncontrolling interests | 12,092,290 | 12,092,402 |
Total Stockholders' Equity | 101,393,367 | 110,742,156 |
Total Liabilities and Stockholders' Equity | $ 185,136,433 | $ 201,474,559 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2018 | Dec. 31, 2017 |
Preferred Stock, par value per share | $ 0.01 | $ 0.01 |
Preferred Stock, shares authorized | 50,000,000 | 50,000,000 |
Preferred Stock, shares issued | 0 | 0 |
Preferred Stock, shares outstanding | 0 | 0 |
Common Stock, par value per share | $ 0.01 | $ 0.01 |
Common Stock, shares authorized | 200,000,000 | 200,000,000 |
Common Stock, shares issued | 13,505,295 | 13,625,769 |
Common Stock, shares outstanding | 13,505,295 | 13,625,769 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Revenues | $ 9,641,938 | $ 9,567,220 | $ 26,595,909 | $ 26,272,336 |
Expenses: | ||||
Property operating expenses | 5,547,031 | 5,323,565 | 15,924,816 | 15,343,476 |
Real estate taxes | 416,958 | 374,030 | 1,186,885 | 1,098,429 |
General and administrative costs | 695,435 | 612,268 | 2,118,404 | 1,667,145 |
Depreciation and amortization | 1,422,276 | 1,326,475 | 4,179,166 | 3,978,221 |
Total operating expenses | 8,081,700 | 7,636,338 | 23,409,271 | 22,087,271 |
Operating income | 1,560,238 | 1,930,882 | 3,186,638 | 4,185,065 |
Loss from investments in unconsolidated affiliated real estate entities | (670,179) | (741,002) | (1,914,788) | (2,066,879) |
Other income/(expense), net | 169,278 | 2,183 | 756,916 | (68,117) |
Interest expense | (1,197,745) | (1,394,475) | (3,999,401) | (4,124,330) |
Net loss | (138,408) | (202,412) | (1,970,635) | (2,074,261) |
Less: net (income)/loss attributable to noncontrolling interests | (1) | 0 | 20 | 22 |
Net loss applicable to Company's common shares | $ (138,409) | $ (202,412) | $ (1,970,615) | $ (2,074,239) |
Net loss per Company's common shares, basic and diluted | $ (0.01) | $ (0.01) | $ (0.15) | $ (0.16) |
Weighted average number of common shares outstanding, basic and diluted | 13,519,833 | 13,654,309 | 13,561,919 | 13,306,503 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Net loss | $ (138,408) | $ (202,412) | $ (1,970,635) | $ (2,074,261) |
Other comprehensive income/(loss): | ||||
Holding gain/(loss) on marketable securities, available for sale | 27,901 | 0 | (139,898) | 0 |
Other comprehensive income/(loss) | 27,901 | 0 | (139,898) | 0 |
Comprehensive loss | (110,507) | (202,412) | (2,110,533) | (2,074,261) |
Less: Comprehensive (income)/loss attributable to noncontrolling interests | (1) | 0 | 20 | 22 |
Comprehensive loss attributable to the Company's common shares | $ (110,508) | $ (202,412) | $ (2,110,513) | $ (2,074,239) |
CONSOLIDATED STATEMENT OF STOCK
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY - 9 months ended Sep. 30, 2018 - USD ($) | Total | Common Stock [Member] | Additional Paid-In Capital [Member] | Accumulated Other Comprehensive Loss [Member] | Accumulated Deficit [Member] | Total Noncontrolling Interests [Member] |
BALANCE at Dec. 31, 2017 | $ 110,742,156 | $ 136,258 | $ 117,061,644 | $ 0 | $ (18,548,148) | $ 12,092,402 |
BALANCE (in shares) at Dec. 31, 2017 | 13,625,769 | |||||
Net loss | (1,970,635) | $ 0 | 0 | 0 | (1,970,615) | (20) |
Other comprehensive loss | (139,898) | 0 | 0 | (139,896) | 0 | (2) |
Distributions declared | (6,082,205) | 0 | 0 | 0 | (6,082,205) | 0 |
Distributions paid to noncontrolling interests | (90) | 0 | 0 | 0 | 0 | (90) |
Redemption and cancellation of shares | (1,155,961) | $ (1,205) | (1,154,756) | 0 | 0 | 0 |
Redemption and cancellation of shares (in shares) | (120,474) | |||||
BALANCE at Sep. 30, 2018 | $ 101,393,367 | $ 135,053 | $ 115,906,888 | $ (139,896) | $ (26,600,968) | $ 12,092,290 |
BALANCE (in shares) at Sep. 30, 2018 | 13,505,295 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (1,970,635) | $ (2,074,261) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Loss from investments in unconsolidated affiliated real estate entities | 1,914,788 | 2,066,879 |
Depreciation and amortization | 4,179,166 | 3,978,221 |
Amortization of deferred financing costs | 357,593 | 339,067 |
Other non-cash adjustments | 49,508 | 34,586 |
Changes in assets and liabilities: | ||
Increase in accounts receivable and other assets | (1,286,200) | (729,920) |
Increase in accounts payable and other accrued expenses | 561,425 | 1,202,392 |
(Decrease)/increase in due to related parties | (12,282) | 20,946 |
Net cash provided by operating activities | 3,793,363 | 4,837,910 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchase of investment property | (2,094,188) | (1,992,273) |
Purchase of marketable securities | (5,990,267) | 0 |
Investment in unconsolidated affiliated real estate entities | (15,001,108) | (20,619,816) |
Distributions from unconsolidated affiliated real estate entities | 330,000 | 0 |
Net cash used in investing activities | (22,755,563) | (22,612,089) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Payments on mortgages payable | (7,867,485) | (315,379) |
(Payment)/refund of loan fees and expenses | (60,002) | 4,400 |
Proceeds from issuance of common stock | 0 | 18,944,234 |
Payment of commissions and offering costs | 0 | (1,851,754) |
Distributions to noncontrolling interests | (90) | (90) |
Distributions to common stockholders | (6,110,513) | (4,749,947) |
Redemption and cancellation of common shares | (1,155,961) | (281,123) |
Net cash (used in)/provided by financing activities | (15,194,051) | 11,750,341 |
Net change in cash and restricted cash | (34,156,251) | (6,023,838) |
Cash and restricted cash, beginning of year | 46,730,079 | 55,915,948 |
Cash and restricted cash, end of period | 12,573,828 | 49,892,110 |
Supplemental cash flow information for the periods indicated is as follows: | ||
Cash paid for interest | 3,729,934 | 3,776,641 |
Distributions declared, but not paid | 666,025 | 672,881 |
Value of shares issued from distribution reinvestment program | 0 | 1,130,386 |
Investment property acquired but not paid | 149,212 | 0 |
Holding loss on marketable securities, available for sale | $ 139,898 | $ 0 |
Organization
Organization | 9 Months Ended |
Sep. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | 1. Organization Lightstone Value Plus Real Estate Investment Trust III, Inc. (‘‘Lightstone REIT III’’), incorporated on October 5, 2012, in Maryland, elected to qualify to be taxed as a real estate investment trust (‘‘REIT’’) for U.S. federal income tax purposes beginning with the taxable year ended December 31, 2015. The Company has and expects to continue to seek to acquire hotels and other commercial real estate assets primarily located in the United States. All such properties may be acquired and operated by the Company alone or jointly with another party. The Company may also originate or acquire mortgage loans secured by real estate. The Lightstone REIT III is structured as an umbrella partnership REIT, or UPREIT, and substantially all of its current and future business will be conducted through Lightstone Value Plus REIT III LP, a Delaware limited partnership (the ‘‘Operating Partnership’’). Lightstone REIT III and the Operating Partnership and its subsidiaries are collectively referred to as the “Company” and the use of “we,” “our,” “us” or similar pronouns refers to Lightstone REIT III, its Operating Partnership or the Company as required by the context in such pronoun used. Lightstone REIT III sold 20,000 Common Shares to Lightstone Value Plus REIT III LLC, a Delaware limited liability company (the ‘‘Advisor’’), an entity majority owned by David Lichtenstein, on December 24, 2012, for $10.00 per share. Mr. Lichtenstein also is a majority owner of the equity interests of Lightstone REIT III’s sponsor, The Lightstone Group, LLC (the ‘‘Sponsor’’). Subject to the oversight of the Company’s board of directors (the “Board of Directors”), the Advisor has primary responsibility for making investment decisions and managing the Company’s day-to-day operations. Through his ownership and control of The Lightstone Group, Mr. Lichtenstein is the indirect owner of the Advisor and the indirect owner and manager of Lightstone SLP III LLC, which has subordinated participation interests in the Operating Partnership. Mr. Lichtenstein also acts as the Company’s Chairman and Chief Executive Officer. As a result, he exerts influence over but does not control Lightstone REIT III or the Operating Partnership. Lightstone REIT III invested the proceeds received from the Advisor in the Operating Partnership, and as a result, held a 99% general partnership interest as of September 30, 2018 in the Operating Partnership’s partner units. The Company’s registration statement on Form S-11 (the “Offering”), pursuant to which it offered to sell up to 30,000,000 shares of its common stock, par value $0.01 per share, (which may be referred to herein as ‘‘shares of common stock’’ or as ‘‘Common Shares’’) for an initial offering price of $10.00 per share, subject to certain volume and other discounts (the “Primary Offering”) (exclusive of 10,000,000 shares available pursuant to its distribution reinvestment plan (the “DRIP”) which were offered at a discounted price equivalent to 95% of the Primary Offering price per Common Share) was declared effective by the Securities and Exchange Commission (the “SEC”) under the Securities Act of 1933 on July 15, 2014. On June 30, 2016, the Company adjusted the offering price to $9.50 per Common Share in its Primary Offering, which was equal to the Company’s estimated net asset value (“NAV”) per Common Share as of March 31, 2016, and effective July 25, 2016, the Company’s offering price was adjusted to $10.00 per Common Share in its Primary Offering, which was equal to the estimated NAV per Common Share as of June 30, 2016. Our estimated NAV per Common Share remained unchanged at $10.00 as of both September 30, 2016 and December 31, 2016, respectively. The Offering, which terminated on March 31, 2017, raised aggregate gross proceeds of approximately $131.7 million from the sale of approximately 13.4 million shares of common stock (including $2.0 million in Common Shares at a purchase price of $9.00 per Common Share to an entity 100% owned by David Lichtenstein, who also owns a majority interest in the Company’s Sponsor). After including the purchase of an aggregate of $12.1 million of Subordinated Participation Interests by the Special Limited Partner and allowing for the payment of approximately $12.2 million in selling commissions and dealer manager fees and $4.8 million in organization and other offering expenses, the Offering generated aggregate net proceeds of approximately $126.8 million. On April 21, 2017, the Company’s board of directors approved the termination of the DRIP effective May 15, 2017. Previously, the Company’s stockholders had an option to elect the receipt of shares of the Company’s common stock in lieu of cash distributions under the Company’s DRIP, however, all future distributions will be in the form of cash. In addition, through May 15, 2017 (the termination date of the DRIP), the Company had issued approximately 0.3 million shares of common stock under its DRIP, representing approximately $3.2 million of additional proceeds under the Offering. The Company has no employees. The Company has retained the Advisor to manage its affairs on a day-to-day basis. Beacon Property Management Limited Liability Company and Paragon Retail Property Management LLC (the ‘‘Property Managers’’), both affiliates of the Sponsor, may serve as property managers and/or the Company may utilize third-party property managers. Orchard Securities, LLC (the ‘‘Dealer Manager’’), a third-party not affiliated with the Company, the Sponsor or the Advisor, served as the dealer manager of the Offering until their termination on March 31, 2017, as a result of the termination of the Offering. In addition to the Property Managers, the Advisor is also an affiliate of the Sponsor. These related parties receive compensation and fees for services related to the investment and management of the Company’s assets. Noncontrolling Interests Partners of Operating Partnership On July 16, 2014, the Advisor contributed $2,000 to the Operating Partnership in exchange for 200 limited partner units in the Operating Partnership. The limited partner has the right to convert operating partnership units into cash or, at the option of the Company, an equal number of common shares of the Company, as allowed by the limited partnership agreement. Lightstone SLP III LLC (the ‘‘Special Limited Partner’’), a Delaware limited liability company of which Mr. Lichtenstein is the majority owner, is a special limited partner in the Operating Partnership which committed to make a significant equity investment (the “Contribution Agreement”) in the Company of up to $36.0 million, which was equivalent to 12.0% of the $300.0 million maximum amount of the Offering, which was terminated on March 31, 2017. The Operating Partnership issued one Subordinated Participation Interest for each $50,000 in cash or interests in real property of equivalent value that the Special Limited Partner contributed. In connection with the termination of the Offering, on March 31, 2017, the Company and the Sponsor terminated the Contribution Agreement and as result of the termination, the Sponsor is no longer obligated to purchase Subordinated Participation Interests . Through March 31, 2017 (the termination date of the Offering), the Special Limited Partner purchased an aggregate of approximately 242 Subordinated Participation Interests in consideration of $12.1 million. The Subordinated Participation Interests may be entitled to receive liquidation distributions upon the liquidation of Lightstone REIT III. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies The accompanying unaudited interim consolidated financial statements and related notes should be read in conjunction with the audited Consolidated Financial Statements of the Company and related notes as contained in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2017. The unaudited interim financial statements include all adjustments (consisting only of normal recurring adjustments) and accruals necessary in the judgment of management for a fair statement of the results for the periods presented. The accompanying unaudited consolidated financial statements of the Lightstone Value Plus Real Estate Investment Trust III, Inc. and its Subsidiaries have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Rule 8-03 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses during a reporting period. The most significant assumptions and estimates relate to the valuation of real estate, depreciable lives, and revenue recognition. Application of these assumptions requires the exercise of judgment as to future uncertainties and, as a result, actual results could differ from these estimates. The consolidated balance sheet as of December 31, 2017 included herein has been derived from the consolidated balance sheet included in the Company's Annual Report on Form 10-K. The unaudited consolidated statements of operations for interim periods are not necessarily indicative of results for the full year or any other period. To qualify or maintain our qualification as a REIT, we engage in certain activities through wholly-owned taxable REIT subsidiaries (“TRS”). As such, we are subject to U.S. federal and state income and franchise taxes from these activities. Marketable Securities Marketable securities currently consist of debt securities that are designated as available-for-sale and are recorded at fair value. Unrealized holding gains or losses for debt securities are reported as a component of accumulated other comprehensive income/(loss). Realized gains or losses resulting from the sale of these securities are determined based on the specific identification of the securities sold. An impairment charge is recognized when the decline in the fair value of a security below the amortized cost basis is determined to be other-than-temporary. The Company considers various factors in determining whether to recognize an impairment charge, including the duration and severity of any decline in fair value below our amortized cost basis, any adverse changes in the financial condition of the issuers’ and its intent and ability to hold the investment for a period of time sufficient to allow for any anticipated recovery in market value. Principles of Consolidation and Basis of Presentation The consolidated financial statements include the accounts of Lightstone REIT III and the Operating Partnership and its subsidiaries (over which the Company exercises financial and operating control). As of September 30, 2018, Lightstone REIT III had a 99% general partnership interest in the common units of the Operating Partnership. All inter-company accounts and transactions have been eliminated in consolidation. In determining whether the Company has a controlling financial interest in a joint venture and the requirement to consolidate the accounts of that entity, management considers factors such as ownership interest, authority to make decisions and contractual and substantive participating rights of the other partners or members as well as whether the entity is a variable interest entity for which the Company is the primary beneficiary. Recently Adopted Accounting Pronouncements Effective January 1, 2018 the Company adopted guidance issued by the Financial Accounting Standards Board (“FASB”) that that requires amounts that are generally described as restricted cash and to be included with cash when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The Company adopted this standard using the retrospective transition method. As required by the Company’s lenders, restricted cash is held in escrow accounts for anticipated capital expenditures, real estate taxes, and other reserves for certain of our consolidated properties. Capital reserves are typically utilized for non-operating expenses such as major capital expenditures. Alternatively, a lender may require its own formula for an escrow of capital reserves. The following is a summary of the Company’s cash, cash equivalents, and restricted cash total as presented in our statements of cash flows for the periods presented: September 30, 2018 2017 Cash $ 10,842,438 $ 48,643,755 Restricted cash 1,731,390 1,248,355 Total cash and restricted cash $ 12,573,828 $ 49,892,110 Effective January 1, 2018, the Company adopted guidance issued by the FASB that clarifies the definition of a business and assists in the evaluation of whether a transaction will be accounted for as an acquisition of an asset or as a business combination. The guidance provides a test to determine when a set of assets and activities acquired is not a business. When substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets, the set is not a business. Additionally, assets acquired, liabilities assumed, and any noncontrolling interest will be measured at their relative fair values. The Company anticipates future acquisitions of real estate assets, if any, will likely qualify as an asset acquisition. Therefore, any future transaction costs associated with an asset acquisition will be capitalized and accounted for in accordance with this guidance. Effective January 1, 2018, the Company adopted guidance issued by the FASB that outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most of the previous revenue recognition guidance. The new guidance requires companies to apply a five-step model in accounting for revenue arising from contracts with customers, as well as enhance disclosures regarding revenue recognition. Additionally, the sale of real estate is required to follow the new model. The Company adopted this standard on January 1, 2018 using the modified retrospective transition method. Due to the short-term nature of the Company's revenue streams, the adoption of this standard did not have an impact on the amount and timing of revenue recognition for revenues from rooms and food, beverage and other ancillary services. The adoption of this standard had no impact on the Company's revenue or net income, and, therefore, no adjustment was recorded to the Company's opening balance of accumulated deficit. The Company also considered and determined that presenting revenue disaggregated by rooms and food, beverage and other depicts the appropriate categories about the nature and timing of its revenue streams and that no additional disaggregation is needed. See Note 3. New Accounting Pronouncements In August 2018, the SEC adopted the final rule amending certain disclosure requirements that have become redundant, duplicative, overlapping, outdated, or superseded. In addition, the amendments expand the disclosure requirements on the analysis of stockholders' equity for interim financial statements. Under the amendments, an analysis of changes in each caption of stockholders' equity presented in the balance sheet must be provided in a note or separate statement. The rule was effective on November 5, 2018 and will be effective for the quarter that begins after the effective date. Since the Company already includes a year to date consolidated statement of stockholders’ equity in our interim financial statement filings, the adoption of this guidance will result in the inclusion of a quarter to date consolidated statement of stockholders equity in our second and third quarter interim financial statement filings and the inclusion of corresponding prior periods statement of stockholders’ equity for all periods presented. In February 2016, the FASB issued an accounting standards update which supersedes the existing lease accounting model, and modifies both lessee and lessor accounting. The new guidance will require lessees to recognize a liability to make lease payments and a right-of-use asset, initially measured at the present value of lease payments, for both operating and financing leases, with classification affecting the pattern of expense recognition in the statement of earnings. For leases with a term of 12 months or less, lessees will be permitted to make an accounting policy election by class of underlying asset to not recognize lease liabilities and lease assets. The standard offers several practical expedients for transition and certain expedients specific to lessees or lessors. Both lessees and lessors are permitted to make an election to apply a package of practical expedients available for implementation under the standard. The Company intends to apply the package of practical expedients and certain other transition expedients. For transition, the Company intends to recognize all effects of transition in the beginning of the adoption reporting period on January 1, 2019. We expect that the adoption of this standard will result in the recognition of right-of-use assets and related lease liability accounts on the consolidated balance sheet but is not expected to have a material effect on our consolidated financial position or our results of operations, however, the ultimate impact of adopting this standard will depend on the Company’s lease portfolio as of the adoption date. The Company has reviewed and determined that other recently issued accounting pronouncements will not have a material impact on its financial position, results of operations and cash flows, or do not apply to its current operations. |
Revenues
Revenues | 9 Months Ended |
Sep. 30, 2018 | |
Revenues [Abstract] | |
Revenues | 3. Revenues Revenues consist of amounts derived from hotel operations, including occupied hotel rooms and sales of food, beverage and other ancillary services and are presented on a disaggregated basis below. Revenues are recorded net of any sales or occupancy tax collected from our guests. Room revenue is generated through contracts with customers whereby the customers agree to pay a daily rate for right to use a hotel room. The Company's contract performance obligations are fulfilled at the end of the day that the customer is provided the room and revenue is recognized daily at the contract rate. Payment from the customer is secured at the end of the contract upon check-out by the customer from our hotels. The Company participates in frequent guest programs sponsored by the brand owners of our hotels whereby the brand owner allows guests to earn loyalty points during their hotel stay. The Company recognizes revenue at the amount earned that it will receive from the brand owner when a guest redeems their loyalty points by staying at one of the Company’s hotels. Revenue from food, beverage and other ancillary services is generated when a customer chooses to purchase goods or services separately from a hotel room and revenue is recognized when these goods or services are provided to the customer and the Company’s contract performance obligations have been fulfilled Some contracts for rooms, food, beverage or other services require an upfront deposit which is recorded as deferred revenues (or contract liabilities) and recognized once the performance obligations are satisfied. The contract liabilities are not significant. The Company notes no significant judgements regarding the recognition of room, food and beverage or other revenues. The following table represents the total revenues from hotel operations on a disaggregated basis: For the Three Months Ended September 30, For the Nine Months Ended September 30, Revenues 2018 2017 2018 2017 Room $ 9,311,724 $ 9,278,584 $ 25,644,693 $ 25,438,374 Food, beverage and other 330,214 288,636 951,216 833,962 Total revenues $ 9,641,938 $ 9,567,220 $ 26,595,909 $ 26,272,336 |
Investments in Unconsolidated A
Investments in Unconsolidated Affiliated Real Estate Entities | 9 Months Ended |
Sep. 30, 2018 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investments in Unconsolidated Affiliated Real Estate Entities | 4. Investments in Unconsolidated Affiliated Real Estate Entities The entities listed below are partially owned by the Company. The Company accounts for these investments under the equity method of accounting as the Company exercises significant influence, but does not exercise financial and operating . A summary of the Company’s investments in the unconsolidated affiliated real estate entities is as follows: As of Entity Date of Ownership Ownership % September 30, 2018 December 31, 2017 RP Maximus Cove, L.L.C. (the "Cove Joint Venture") January 31, 2017 22.50 % $ 17,583,182 $ 17,805,991 LVP LIC Hotel JV LLC (the "Hilton Garden Inn Joint Venture") March 27, 2018 50.00 % 12,979,130 - Total investments in unconsolidated affiliated real estate entities $ 30,562,312 $ 17,805,991 The Cove Joint Venture On January 31, 2017, the Company, through a subsidiary of the Operating Partnership, REIT III COVE LLC (“REIT III Cove”) and REIT IV COVE LLC (“REIT IV Cove”), a wholly owned subsidiary of Lightstone Real Estate Income Trust, Inc. (“Lightstone IV”), a real estate investment trust also sponsored by the Sponsor and a related party, LSG Cove LLC (“LSG Cove”), an affiliate of the Sponsor and a related party, and Maximus Cove Investor LLC (“Maximus”), an unrelated third party (collectively, the “Members”), completed the acquisition of all of RP Cove, L.L.C’s membership interest in RP Maximus Cove, L.L.C. (the “Cove Joint Venture”) for aggregate consideration of approximately $255.0 million, which consisted of $80.0 million of cash and $175.0 million of proceeds from a loan from a financial institution. The Cove Joint Venture owns and operates The Cove at Tiburon (“the Cove”), a multi-family complex consisting of 281-units, or 289,690 square feet, contained within 32 apartment buildings over 20.1 acres originally constructed in 1967, located in Tiburon, California. In connection with the acquisition, the Company paid the Advisor an acquisition fee of $0.6 million, equal to 1.0% of the Company’s pro-rata share of the contractual purchase price which is reflected in the Company’s carrying value which is included in investments in unconsolidated affiliated real estate entities on the consolidated balance sheets. The Company paid approximately $20.0 million for a 22.5% membership interest in the Cove Joint Venture. The Company’s ownership interest in the Cove Joint Venture is a non-managing interest. The Company has determined that the Cove Joint Venture is a variable interest entity but the Company is not the primary beneficiary. The Company accounts for its ownership interest in the Cove Joint Venture in accordance with the equity method of accounting because it exerts significant influence over but does not control the Cove Joint Venture. All capital contributions and distributions of earnings from the Cove Joint Venture are made on a pro rata basis in proportion to each Member’s equity interest percentage. Any distributions in excess of earnings from the Cove Joint Venture are made to the Members pursuant to the terms of the Cove Joint Venture’s operating agreement. An affiliate of Maximus is the asset manager of the Cove and receives certain fees as defined in the Property Management Agreement for the management of the Cove. The Company commenced recording its allocated portion of profit/loss and cash distributions beginning as of January 31, 2017 with respect to its membership interest of 22.5% in the Cove Joint Venture. During the nine months ended September 30, 2018, the Company made additional capital contributions of $1.7 million to the Cove Joint Venture. In connection with the closing of the Cove Transaction, the Cove Joint Venture simultaneously entered into a $175.0 million loan (the “Loan”) initially scheduled to mature on January 31, 2020 with two, one-year extension options, subject to certain conditions. The Loan requires monthly interest payments through its maturity date. The Loan bears interest at Libor plus 3.85% through its initial maturity and Libor plus 4.15% during each of the extension periods. The Loan is collateralized by the Cove and an affiliate of the Company’s Sponsor (the “Guarantor”) has guaranteed the Cove Joint Venture‘s obligation to pay the outstanding balance of the Loan up to approximately $43.8 million (the “Loan Guarantee”). The Members have agreed to reimburse the Guarantor for any balance that may become due under the Loan Guarantee, of which the Company’s share is up to approximately $10.9 million. Starting in 2013, the Cove has been undergoing an extensive refurbishment which is substantially completed. The Members used the remaining proceeds from the Loan and have invested additional capital as necessary to complete the refurbishment. The Guarantor has provided an additional guarantee of up to approximately $13.4 million (the “Refurbishment Guarantee”) to provide any necessary funds to complete the remaining renovations as defined in the Loan. The Members have agreed to reimburse the Guarantor for any balance that may become due under the Refurbishment Guarantee, of which the Company’s share is up to approximately $3.3 million. The Company has determined that the fair value of both the Loan Guarantee and the Refurbishment Guarantee are immaterial. The Cove Joint Venture Condensed Financial Information The Company’s carrying value of its interest in the Cove Joint Venture differs from its share of member’s equity reported in the condensed balance sheet of the Cove Joint Venture due to the Company’s basis of its investment in excess of the historical net book value of the Cove Joint Venture. The Company’s additional basis allocated to depreciable assets is being recognized on a straight-line basis over the lives of the appropriate assets. The following table represents the condensed income statements for the Cove Joint Venture: (amounts in thousands) For the Three Months Ended September 30, 2018 For the Three Months Ended September 30, 2017 For the Nine Months Ended September 30, 2018 For the Period January 31, 2017 (date of investment) through September 30, 2017 Revenues $ 3,672 $ 3,523 $ 10,905 $ 8,724 Property operating expenses 1,239 1,175 3,660 3,076 General and administrative costs 41 54 136 196 Depreciation and amortization 2,420 2,383 7,214 6,348 Operating loss (28 ) (89 ) (105 ) (896 ) Interest expense and other, net (2,833 ) (2,406 ) (8,145 ) (6,161 ) Net loss $ (2,861 ) $ (2,495 ) $ (8,250 ) $ (7,057 ) Company's share of net loss (22.50%) $ (644 ) $ (561 ) $ (1,856 ) $ (1,588 ) Adjustment to depreciation and amortization expense (1) (10 ) (180 ) (87 ) (479 ) Company's loss from investment $ (654 ) $ (741 ) $ (1,943 ) $ (2,067 ) The following table represents the condensed balance sheets for the Cove Joint Venture: As of As of (amounts in thousands) September 30, 2018 December 31, 2017 Real estate, at cost (net) $ 150,654 $ 149,727 Cash and restricted cash 1,433 2,538 Other assets 2,304 1,541 Total assets $ 154,391 $ 153,806 Mortgage payable, net $ 173,889 $ 173,534 Other liabilities 3,395 2,830 Members' deficit (1) (22,893 ) (22,558 ) Total liabilities and members' deficit $ 154,391 $ 153,806 (1) The adjustment to depreciation and amortization expense relates to the difference between the Company’s basis in the Cove Joint Venture and the amount of the underlying equity in net assets of the Cove Joint Venture. Hilton Garden Inn Joint Venture On March 27, 2018, the Company and its Sponsor’s other public program, Lightstone Value Plus Real Estate Investment Trust II, Inc. (“Lightstone REIT II”), acquired, through LVP LIC Hotel JV LLC (the “Hilton Garden Inn Joint Venture”) a 183-room, limited-service hotel located at 29-21 41 st In connection with the acquisition, the Company paid an acquisition fee of $0.3 million payable to the Advisor, equal to 1.0% of the Company’s pro-rata share of the contractual purchase price which is reflected in the Company’s carrying value which is included in investments in unconsolidated affiliated real estate entities on the consolidated balance sheets. The Company paid approximately $12.9 million for a 50.0% membership interest in the Hilton Garden Inn Joint Venture. The Company’s ownership interest in the Hilton Garden Inn Joint Venture is a co-managing interest. The Company accounts for its ownership interest in the Hilton Garden Inn Joint Venture in accordance with the equity method of accounting because it exerts significant influence over but does not control the Hilton Garden Inn Joint Venture. All capital contributions and distributions of earnings from the Hilton Garden Inn Joint Venture are made on a pro rata basis in proportion to each Member’s equity interest percentage. Any distributions in excess of earnings from the Hilton Garden Inn Joint Venture are made to the Members pursuant to the terms of the Hilton Garden Inn Joint Venture’s operating agreement. The Company commenced recording its allocated portion of profit/loss and cash distributions beginning as of March 27, 2018 with respect to its membership interest of 50.0% in the Hilton Garden Inn Joint Venture. During the nine months ended September 30, 2018, the Company received distributions from the Hilton Garden Inn Joint Venture aggregating $0.3 million. Hilton Garden Inn Joint Venture Financial Information The following table represents the condensed income statement for the Hilton Garden Inn Joint Venture for the period indicated: (amounts in thousands) For the Three Months Ended September 30, 2018 For the Period March 27, 2018 through September 30, 2018 Revenues $ 2,856 $ 6,040 Property operating expenses 1,754 3,725 General and administrative costs 13 15 Depreciation and amortization 639 1,274 Operating income 450 1,026 Interest expense (482 ) (970 ) N et (loss)/income $ (32 ) $ 56 Company's share of net (loss)/income (50.00%) $ (16 ) $ 28 The following table represents the condensed balance sheet for the Hilton Garden Inn Joint Venture: As of (amounts in thousands) September 30, 2018 Investment property, net $ 59,210 Cash 761 Other assets 909 Total assets $ 60,880 Mortgage payable, net $ 34,752 Other liabilities 770 Members' capital 25,358 Total liabilities and members' capital $ 60,880 |
Marketable Securities and Fair
Marketable Securities and Fair Value Measurements | 9 Months Ended |
Sep. 30, 2018 | |
Marketable Securities Margin Loan And Fair Value Measurements [Abstract] | |
Marketable Securities and Fair Value Measurements | 5. Marketable Securities and Fair Value Measurements Marketable Securities The following is a summary of the Company’s available for sale securities as of the dates indicated: As of September 30, 2018 Debt securities: Adjusted Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Corporate Bonds and Preferred Securities $ 5,990,267 $ - $ (139,898 ) $ 5,850,369 When evaluating the investments for other-than-temporary impairment, the Company reviews factors such as the length of time and extent to which fair value has been below cost basis, the financial condition of the issuer and any changes thereto, and the Company’s intent to sell, or whether it is more likely than not it will be required to sell, the investment before recovery of the investment’s amortized cost basis. As of September 30, 2018, the Company did not recognize any impairment charges. Fair Value Measurements Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The standard describes a fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value: • Level 1 – Quoted prices in active markets for identical assets or liabilities. • Level 2 – Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. • Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. As of September 30, 2018, all of the Company’s debt securities and were classified as Level 2 assets and there were no transfers between the level classifications during the nine months ended September 30, 2018. The fair values of the Company’s investments in Corporate Bonds and Preferred Securities are measured using readily available quoted prices for similar assets. The following table summarizes the estimated fair value of our investments in marketable debt securities with stated contractual maturity dates, accounted for as available-for-sale securities and classified by the contractual maturity date of the securities: As of September 30, 2018 Due in 1 year $ 748,125 Due in 1 year through 5 years 3,166,494 Due in 5 year through 10 years 1,257,000 Due after 10 years 678,750 Total $ 5,850,369 The Company did not have any other significant financial assets or liabilities, which would require revised valuations that are recognized at fair value. The Company has access to a margin loan from a financial institution that holds custody of certain of the Company’s marketable securities. The margin loan is collateralized by the marketable securities in the Company’s account. The amounts available to the Company under the margin loan are at the discretion of the financial institution and not limited to the amount of collateral in its account. The margin loan bears interest at Libor plus 0.85% (3.11% as of September 30, 2018). |
Mortgage payable, net
Mortgage payable, net | 9 Months Ended |
Sep. 30, 2018 | |
Loans Payable [Abstract] | |
Mortgage payable, net | 6. Mortgage payable, net Mortgages payable, net consists of the following: Description Interest Rate Weighted Average Interest Rate as of September 30, 2018 Maturity Date Amount Due at Maturity As of September 30, As of December 31, Revolving Credit Facility, secured by seven properties LIBOR + 3.50% 6.13 % July 2019 $ 52,159,414 $ 52,159,414 $ 59,696,000 Promissory Note, secured by two properties 4.73% 4.73 % October 2021 26,127,572 27,576,728 27,907,627 Total mortgages payable 5.65 % $ 78,286,986 $ 79,736,142 $ 87,603,627 Less: Deferred financing costs (403,251 ) (700,843 ) Total mortgage payable, net $ 79,332,891 $ 86,902,784 On June 19, 2018 the Company made a principal payment of $7.4 million in cash on the non-recourse Revolving Credit Facility and the lender agreed to decrease the interest rate to Libor plus 3.50 % from Libor plus 4.95 %. Additionally, the non-recourse Revolving Credit Facility (outstanding principal balance of $52.2 million as of September 30, 2018) matures in July 2019. The Company intends to seek to refinance such existing indebtedness on or before its applicable stated maturity. Principal Maturities The following table, based on the initial terms of the mortgage, sets forth their aggregate estimated contractual principal maturities, including balloon payments due at maturity, as of September 30, 2018: 2018 2019 2020 2021 2022 Thereafter Total Principal maturities $ 114,152 $ 52,626,285 $ 486,092 $ 26,509,613 $ - $ - $ 79,736,142 Less: Deferred financing costs (403,251 ) Total principal maturiteis, net $ 79,332,891 Debt Compliance Pursuant to the Company’s debt agreements, approximately $1.7 million and $1.2 million was held in restricted cash accounts as of September 30, 2018 and December 31, 2017, respectively. Such escrows are subject to release in accordance with the applicable debt agreement for the payment of real estate taxes, insurance and capital improvements, as required. Certain of our debt agreements contain clauses providing for prepayment penalties and requiring the maintenance of certain ratios including debt service coverage and fixed leverage charge ratio. The Company is currently in compliance with respect to all of its financial debt covenants. |
Selling Commissions, Dealer Man
Selling Commissions, Dealer Manager Fees and Other Offering Costs | 9 Months Ended |
Sep. 30, 2018 | |
Selling Commission, Dealer Manager Fees And Other Offering Costs [Abstract] | |
Selling Commissions, Dealer Manager Fees and Other Offering Costs | 7. Selling Commissions, Dealer Manager Fees and Other Offering Costs During our Offering, selling commissions and dealer manager fees were paid to the Dealer Manager or soliciting dealers, as applicable, pursuant to various agreements, and other third-party offering costs such as registration fees, due diligence fees, marketing costs, and professional fees were accounted for as a reduction against additional paid-in capital as costs were incurred. Any organizational costs were accounted for as general and administrative costs. During the three months ended March 31, 2017, we incurred approximately $1.7 million of selling commissions and deal manager fees and less than $0.1 million of other offering costs. We did not incur any of these costs subsequent to the termination of the Offering. From our inception through March 31, 2017 (the termination date of the Offering), we incurred approximately $12.2 million in selling commissions and dealer manager fees and $4.8 million of other offering costs in connection with the public offering of shares of our common stock. |
Earnings per Share
Earnings per Share | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
Earnings per Share | 8. Earnings per Share The Company had no potentially dilutive securities outstanding during the periods presented. Accordingly, basic and diluted earnings per share is calculated by dividing earnings attributable to common shareholders by the weighted-average number of shares of common stock outstanding during the applicable period. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 9. Related Party Transactions Due to related parties and other transactions In addition to certain agreements with the Sponsor (see Note 1) and Dealer Manager (see Note 7), the Company has agreements with the Advisor to pay certain fees in exchange for services performed by the Advisor and/or its affiliated entities. Additionally, the Company’s ability to secure financing and its real estate operations are dependent upon its Advisor and its affiliates to perform such services as provided in these agreements. The following table represents the fees incurred associated with the payments to the Company’s Advisor for the periods indicated: For the Three Months Ended September 30, For the Nine Months Ended September 30, 2018 2017 2018 2017 Acquisition Fees (1) $ - $ - $ 300,000 $ 573,750 Development fees (2) - - 51,419 - Asset Management Fees (general and administrative costs) 447,135 382,022 1,271,867 704,640 Total $ 447,135 $ 382,022 $ 1,623,286 $ 1,278,390 (1) Acquisition fees of $300,000 and $573,750 were capitalized and are reflected in the carrying value of our investments in the Hilton Garden Inn Joint Venture and the Cove Joint Venture, respectively, which are included in investments in unconsolidated affiliated real estate entities on the consolidated balance sheets. (2) Generally, capitalized and amortized over the estimated useful life of the associated asset. |
Financial Instruments
Financial Instruments | 9 Months Ended |
Sep. 30, 2018 | |
Financial Instruments, Owned, at Fair Value [Abstract] | |
Financial Instruments | 10. Financial Instruments The carrying amounts reported in the consolidated balance sheets for cash, accounts receivable and other assets, accounts payable and other accrued expenses and due to/from related parties approximated their fair values because of the short maturity of these instruments. The estimated fair value of our mortgages payable is as follows: As of September 30, 2018 As of December 31, 2017 Carrying Amount Estimated Fair Value Carrying Amount Estimated Fair Value Mortgages payable $ 79,736,142 $ 78,418,087 $ 87,603,627 $ 86,729,748 The fair value of our mortgages payable was determined by discounting the future contractual interest and principal payments by market interest rates. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2018 | |
Commitments and Contingencies [Abstract] | |
Commitments and Contingencies | 11. Commitments and Contingencies Legal Proceedings From time to time in the ordinary course of business, the Company may become subject to legal proceedings, claims or disputes. As of the date hereof, we are not a party to any material pending legal proceedings. |
Distributions
Distributions | 9 Months Ended |
Sep. 30, 2018 | |
Distributions [Abstract] | |
Distributions | 12. Distributions Distribution Payments On August 15, 2018, September 14, 2018 and October 15, 2018, the Company paid distributions for the months ended July 31, 2018, August 31, 2018 and September 30, 2018, respectively, totaling $2.0 million. The distributions were paid in cash. Distribution Declaration On November 13, 2018, the Board of Directors authorized and the Company declared a distribution for each month during the three-month period ending December 31, 2018. The distributions will be calculated based on shareholders of record each day during the month at a rate of $0.00164383 per day, and will equal a daily amount that, if paid each day for a 365-day period, would equal a 6.0% annualized rate based on a share price of $10.00 payable on or about the 15th day following each month end to stockholders of record at the close of business on the last day of the prior month. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Marketable Securities | Marketable Securities Marketable securities currently consist of debt securities that are designated as available-for-sale and are recorded at fair value. Unrealized holding gains or losses for debt securities are reported as a component of accumulated other comprehensive income/(loss). Realized gains or losses resulting from the sale of these securities are determined based on the specific identification of the securities sold. An impairment charge is recognized when the decline in the fair value of a security below the amortized cost basis is determined to be other-than-temporary. The Company considers various factors in determining whether to recognize an impairment charge, including the duration and severity of any decline in fair value below our amortized cost basis, any adverse changes in the financial condition of the issuers’ and its intent and ability to hold the investment for a period of time sufficient to allow for any anticipated recovery in market value. |
Principles of Consolidation and Basis of Presentation | Principles of Consolidation and Basis of Presentation The consolidated financial statements include the accounts of Lightstone REIT III and the Operating Partnership and its subsidiaries (over which the Company exercises financial and operating control). As of September 30, 2018, Lightstone REIT III had a 99% general partnership interest in the common units of the Operating Partnership. All inter-company accounts and transactions have been eliminated in consolidation. In determining whether the Company has a controlling financial interest in a joint venture and the requirement to consolidate the accounts of that entity, management considers factors such as ownership interest, authority to make decisions and contractual and substantive participating rights of the other partners or members as well as whether the entity is a variable interest entity for which the Company is the primary beneficiary. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements Effective January 1, 2018 the Company adopted guidance issued by the Financial Accounting Standards Board (“FASB”) that that requires amounts that are generally described as restricted cash and to be included with cash when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The Company adopted this standard using the retrospective transition method. As required by the Company’s lenders, restricted cash is held in escrow accounts for anticipated capital expenditures, real estate taxes, and other reserves for certain of our consolidated properties. Capital reserves are typically utilized for non-operating expenses such as major capital expenditures. Alternatively, a lender may require its own formula for an escrow of capital reserves. The following is a summary of the Company’s cash, cash equivalents, and restricted cash total as presented in our statements of cash flows for the periods presented: September 30, 2018 2017 Cash $ 10,842,438 $ 48,643,755 Restricted cash 1,731,390 1,248,355 Total cash and restricted cash $ 12,573,828 $ 49,892,110 Effective January 1, 2018, the Company adopted guidance issued by the FASB that clarifies the definition of a business and assists in the evaluation of whether a transaction will be accounted for as an acquisition of an asset or as a business combination. The guidance provides a test to determine when a set of assets and activities acquired is not a business. When substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets, the set is not a business. Additionally, assets acquired, liabilities assumed, and any noncontrolling interest will be measured at their relative fair values. The Company anticipates future acquisitions of real estate assets, if any, will likely qualify as an asset acquisition. Therefore, any future transaction costs associated with an asset acquisition will be capitalized and accounted for in accordance with this guidance. Effective January 1, 2018, the Company adopted guidance issued by the FASB that outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most of the previous revenue recognition guidance. The new guidance requires companies to apply a five-step model in accounting for revenue arising from contracts with customers, as well as enhance disclosures regarding revenue recognition. Additionally, the sale of real estate is required to follow the new model. The Company adopted this standard on January 1, 2018 using the modified retrospective transition method. Due to the short-term nature of the Company's revenue streams, the adoption of this standard did not have an impact on the amount and timing of revenue recognition for revenues from rooms and food, beverage and other ancillary services. The adoption of this standard had no impact on the Company's revenue or net income, and, therefore, no adjustment was recorded to the Company's opening balance of accumulated deficit. The Company also considered and determined that presenting revenue disaggregated by rooms and food, beverage and other depicts the appropriate categories about the nature and timing of its revenue streams and that no additional disaggregation is needed. See Note 3. |
New Accounting Pronouncements | New Accounting Pronouncements In August 2018, the SEC adopted the final rule amending certain disclosure requirements that have become redundant, duplicative, overlapping, outdated, or superseded. In addition, the amendments expand the disclosure requirements on the analysis of stockholders' equity for interim financial statements. Under the amendments, an analysis of changes in each caption of stockholders' equity presented in the balance sheet must be provided in a note or separate statement. The rule was effective on November 5, 2018 and will be effective for the quarter that begins after the effective date. Since the Company already includes a year to date consolidated statement of stockholders’ equity in our interim financial statement filings, the adoption of this guidance will result in the inclusion of a quarter to date consolidated statement of stockholders equity in our second and third quarter interim financial statement filings and the inclusion of corresponding prior periods statement of stockholders’ equity for all periods presented. In February 2016, the FASB issued an accounting standards update which supersedes the existing lease accounting model, and modifies both lessee and lessor accounting. The new guidance will require lessees to recognize a liability to make lease payments and a right-of-use asset, initially measured at the present value of lease payments, for both operating and financing leases, with classification affecting the pattern of expense recognition in the statement of earnings. For leases with a term of 12 months or less, lessees will be permitted to make an accounting policy election by class of underlying asset to not recognize lease liabilities and lease assets. The standard offers several practical expedients for transition and certain expedients specific to lessees or lessors. Both lessees and lessors are permitted to make an election to apply a package of practical expedients available for implementation under the standard. The Company intends to apply the package of practical expedients and certain other transition expedients. For transition, the Company intends to recognize all effects of transition in the beginning of the adoption reporting period on January 1, 2019. We expect that the adoption of this standard will result in the recognition of right-of-use assets and related lease liability accounts on the consolidated balance sheet but is not expected to have a material effect on our consolidated financial position or our results of operations, however, the ultimate impact of adopting this standard will depend on the Company’s lease portfolio as of the adoption date. The Company has reviewed and determined that other recently issued accounting pronouncements will not have a material impact on its financial position, results of operations and cash flows, or do not apply to its current operations. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Cash, Cash Equivalents, and Restricted Cash | The following is a summary of the Company’s cash, cash equivalents, and restricted cash total as presented in our statements of cash flows for the periods presented: September 30, 2018 2017 Cash $ 10,842,438 $ 48,643,755 Restricted cash 1,731,390 1,248,355 Total cash and restricted cash $ 12,573,828 $ 49,892,110 |
Revenues (Tables)
Revenues (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Revenues [Abstract] | |
Revenues From Hotel Operations | The following table represents the total revenues from hotel operations on a disaggregated basis: For the Three Months Ended September 30, For the Nine Months Ended September 30, Revenues 2018 2017 2018 2017 Room $ 9,311,724 $ 9,278,584 $ 25,644,693 $ 25,438,374 Food, beverage and other 330,214 288,636 951,216 833,962 Total revenues $ 9,641,938 $ 9,567,220 $ 26,595,909 $ 26,272,336 |
Investments in Unconsolidated_2
Investments in Unconsolidated Affiliated Real Estate Entities (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Investment in Unconsolidated Affiliated Entity | A summary of the Company’s investments in the unconsolidated affiliated real estate entities is as follows: As of Entity Date of Ownership Ownership % September 30, 2018 December 31, 2017 RP Maximus Cove, L.L.C. (the "Cove Joint Venture") January 31, 2017 22.50 % $ 17,583,182 $ 17,805,991 LVP LIC Hotel JV LLC (the "Hilton Garden Inn Joint Venture") March 27, 2018 50.00 % 12,979,130 - Total investments in unconsolidated affiliated real estate entities $ 30,562,312 $ 17,805,991 |
Condensed Income Statement | The following table represents the condensed income statements for the Cove Joint Venture: (amounts in thousands) For the Three Months Ended September 30, 2018 For the Three Months Ended September 30, 2017 For the Nine Months Ended September 30, 2018 For the Period January 31, 2017 (date of investment) through September 30, 2017 Revenues $ 3,672 $ 3,523 $ 10,905 $ 8,724 Property operating expenses 1,239 1,175 3,660 3,076 General and administrative costs 41 54 136 196 Depreciation and amortization 2,420 2,383 7,214 6,348 Operating loss (28 ) (89 ) (105 ) (896 ) Interest expense and other, net (2,833 ) (2,406 ) (8,145 ) (6,161 ) Net loss $ (2,861 ) $ (2,495 ) $ (8,250 ) $ (7,057 ) Company's share of net loss (22.50%) $ (644 ) $ (561 ) $ (1,856 ) $ (1,588 ) Adjustment to depreciation and amortization expense (1) (10 ) (180 ) (87 ) (479 ) Company's loss from investment $ (654 ) $ (741 ) $ (1,943 ) $ (2,067 ) |
RP Maximus Cove LLC [Member] | |
Condensed Balance Sheet | The following table represents the condensed balance sheets for the Cove Joint Venture: As of As of (amounts in thousands) September 30, 2018 December 31, 2017 Real estate, at cost (net) $ 150,654 $ 149,727 Cash and restricted cash 1,433 2,538 Other assets 2,304 1,541 Total assets $ 154,391 $ 153,806 Mortgage payable, net $ 173,889 $ 173,534 Other liabilities 3,395 2,830 Members' deficit (1) (22,893 ) (22,558 ) Total liabilities and members' deficit $ 154,391 $ 153,806 |
Hilton Garden Inn [Member] | |
Condensed Income Statement | The following table represents the condensed income statement for the Hilton Garden Inn Joint Venture for the period indicated: (amounts in thousands) For the Three Months Ended September 30, 2018 For the Period March 27, 2018 through September 30, 2018 Revenues $ 2,856 $ 6,040 Property operating expenses 1,754 3,725 General and administrative costs 13 15 Depreciation and amortization 639 1,274 Operating income 450 1,026 Interest expense (482 ) (970 ) N et (loss)/income $ (32 ) $ 56 Company's share of net (loss)/income (50.00%) $ (16 ) $ 28 |
Condensed Balance Sheet | The following table represents the condensed balance sheet for the Hilton Garden Inn Joint Venture: As of (amounts in thousands) September 30, 2018 Investment property, net $ 59,210 Cash 761 Other assets 909 Total assets $ 60,880 Mortgage payable, net $ 34,752 Other liabilities 770 Members' capital 25,358 Total liabilities and members' capital $ 60,880 |
Marketable Securities and Fai_2
Marketable Securities and Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Marketable Securities Margin Loan And Fair Value Measurements [Abstract] | |
Schedule of Available-for-sale Securities Reconciliation | The following is a summary of the Company’s available for sale securities as of the dates indicated: As of September 30, 2018 Debt securities: Adjusted Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Corporate Bonds and Preferred Securities $ 5,990,267 $ - $ (139,898 ) $ 5,850,369 |
Available-for-sale Securities | The following table summarizes the estimated fair value of our investments in marketable debt securities with stated contractual maturity dates, accounted for as available-for-sale securities and classified by the contractual maturity date of the securities: As of September 30, 2018 Due in 1 year $ 748,125 Due in 1 year through 5 years 3,166,494 Due in 5 year through 10 years 1,257,000 Due after 10 years 678,750 Total $ 5,850,369 |
Mortgage payable, net (Tables)
Mortgage payable, net (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Loans Payable [Abstract] | |
Mortgages Payable, Net | Mortgages payable, net consists of the following: Description Interest Rate Weighted Average Interest Rate as of September 30, 2018 Maturity Date Amount Due at Maturity As of September 30, As of December 31, Revolving Credit Facility, secured by seven properties LIBOR + 3.50% 6.13 % July 2019 $ 52,159,414 $ 52,159,414 $ 59,696,000 Promissory Note, secured by two properties 4.73% 4.73 % October 2021 26,127,572 27,576,728 27,907,627 Total mortgages payable 5.65 % $ 78,286,986 $ 79,736,142 $ 87,603,627 Less: Deferred financing costs (403,251 ) (700,843 ) Total mortgage payable, net $ 79,332,891 $ 86,902,784 |
Schedule of Maturities of Long-term Debt | The following table, based on the initial terms of the mortgage, sets forth their aggregate estimated contractual principal maturities, including balloon payments due at maturity, as of September 30, 2018: 2018 2019 2020 2021 2022 Thereafter Total Principal maturities $ 114,152 $ 52,626,285 $ 486,092 $ 26,509,613 $ - $ - $ 79,736,142 Less: Deferred financing costs (403,251 ) Total principal maturiteis, net $ 79,332,891 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions | The following table represents the fees incurred associated with the payments to the Company’s Advisor for the periods indicated: For the Three Months Ended September 30, For the Nine Months Ended September 30, 2018 2017 2018 2017 Acquisition Fees (1) $ - $ - $ 300,000 $ 573,750 Development fees (2) - - 51,419 - Asset Management Fees (general and administrative costs) 447,135 382,022 1,271,867 704,640 Total $ 447,135 $ 382,022 $ 1,623,286 $ 1,278,390 (1) Acquisition fees of $300,000 and $573,750 were capitalized and are reflected in the carrying value of our investments in the Hilton Garden Inn Joint Venture and the Cove Joint Venture, respectively, which are included in investments in unconsolidated affiliated real estate entities on the consolidated balance sheets. (2) Generally, capitalized and amortized over the estimated useful life of the associated asset. |
Financial Instruments (Tables)
Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Financial Instruments, Owned, at Fair Value [Abstract] | |
Schedule Of Mortgage Payable | The estimated fair value of our mortgages payable is as follows: As of September 30, 2018 As of December 31, 2017 Carrying Amount Estimated Fair Value Carrying Amount Estimated Fair Value Mortgages payable $ 79,736,142 $ 78,418,087 $ 87,603,627 $ 86,729,748 |
Organization (Details Textual)
Organization (Details Textual) - USD ($) | May 15, 2017 | Mar. 31, 2017 | Jul. 16, 2014 | Dec. 24, 2012 | Mar. 31, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Jul. 15, 2014 |
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ||||||||||||
Shares reserved for issuance, price per share | $ 10 | |||||||||||
General partner ownership interest | 99.00% | |||||||||||
Common Stock, Par Value | $ 0.01 | $ 0.01 | ||||||||||
Equity Method investment ,Percentage of Maximum Offering cost | 12.00% | |||||||||||
Maximum Amount of Offering | $ 300,000,000 | |||||||||||
Equity Method Investment, Aggregate Cost | 36,000,000 | $ 36,000,000 | ||||||||||
Issuance of Subordinated Participation Interest for Each Partner | $ 50,000 | 50,000 | ||||||||||
Proceeds from Contributions from Affiliates | $ 330,000 | $ 0 | ||||||||||
Payments of Stock Issuance Costs | $ 0 | $ 1,851,754 | ||||||||||
Stock Issued During Period, Shares, Dividend Reinvestment Plan | 300,000 | |||||||||||
Distribution Reinvestment Offered Discounted Percentage | 95.00% | |||||||||||
Proceeds from Issuance of Common Stock, Dividend Reinvestment Plan | $ 3,200,000 | |||||||||||
Common Stock, Shares Authorized | 200,000,000 | 200,000,000 | ||||||||||
General Partner [Member] | ||||||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ||||||||||||
Contribution from advisor | $ 2,000 | |||||||||||
Number of limited partner units issued to advisor | 200 | |||||||||||
Limited Partner [Member] | ||||||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ||||||||||||
Partners' Capital Account, Contributions | $ 12,100,000 | |||||||||||
Partners' Capital Account, Units, Contributed | 242 | |||||||||||
Lightstone Value Plus REIT III LLC [Member] | ||||||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ||||||||||||
Issuance of common shares, shares | 13,400,000 | 20,000 | ||||||||||
Issuance of common shares, value | $ 131,700,000 | |||||||||||
Company owned by David Lichtenstein [Member] | ||||||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ||||||||||||
Shares reserved for issuance, price per share | $ 9 | $ 9 | ||||||||||
Issuance of common shares, value | $ 2,000,000 | |||||||||||
Equity Method investment ,Percentage of Maximum Offering cost | 100.00% | |||||||||||
Stock Offering [Member] | ||||||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ||||||||||||
Shares reserved for issuance, price per share | $ 10 | $ 10 | $ 10 | $ 10 | ||||||||
Proceeds from Contributions from Affiliates | $ 12,200,000 | |||||||||||
Adjustments to Additional Paid in Capital, Stock Issued, Issuance Costs | 12,100,000 | |||||||||||
Payments of Stock Issuance Costs | 4,800,000 | |||||||||||
Proceeds from Issuance Initial Public Offering | $ 126,800,000 | |||||||||||
Common Stock, Shares Authorized | 30,000,000 | |||||||||||
Distribution Reinvestment Plan [Member] | ||||||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ||||||||||||
Shares reserved for issuance | 10,000,000 | |||||||||||
Shares issued, price per share | $ 9.50 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Dec. 31, 2016 |
Cash | $ 10,842,438 | $ 45,050,023 | $ 48,643,755 | |
Restricted cash | 1,731,390 | 1,680,056 | 1,248,355 | |
Total cash and restricted cash | $ 12,573,828 | $ 46,730,079 | $ 49,892,110 | $ 55,915,948 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Details Textual) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Line Items] | |
General partner ownership interest | 99.00% |
Revenues (Details)
Revenues (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Total revenues | $ 9,641,938 | $ 9,567,220 | $ 26,595,909 | $ 26,272,336 |
Room [Member] | ||||
Total revenues | 9,311,724 | 9,278,584 | 25,644,693 | 25,438,374 |
Food, beverage and other [Member] | ||||
Total revenues | $ 330,214 | $ 288,636 | $ 951,216 | $ 833,962 |
Investments in Unconsolidated_3
Investments in Unconsolidated Affiliated Real Estate Entities (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2017 | |
Schedule of Equity Method Investments [Line Items] | ||
Equity Method Investments | $ 30,562,312 | $ 17,805,991 |
RP Maximus Cove LLC [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Business Acquisition, Date of Acquisition Agreement | Jan. 31, 2017 | |
Equity Method Investment, Ownership Percentage | 22.50% | |
Equity Method Investments | $ 17,583,182 | 17,805,991 |
LVP LIC Hotel JV LLC [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Business Acquisition, Date of Acquisition Agreement | Mar. 27, 2018 | |
Equity Method Investment, Ownership Percentage | 50.00% | |
Equity Method Investments | $ 12,979,130 | $ 0 |
Investments in Unconsolidated_4
Investments in Unconsolidated Affiliated Real Estate Entities (Details 1) - USD ($) | 3 Months Ended | 6 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | |
Schedule of Equity Method Investments [Line Items] | |||||
Company's loss from investment | $ (670,179) | $ (741,002) | $ (1,914,788) | $ (2,066,879) | |
Hilton Garden Inn [Member] | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Revenues | 2,856,000 | $ 6,040,000 | |||
Property operating expenses | 1,754,000 | 3,725,000 | |||
General and administrative costs | 13,000 | 15,000 | |||
Depreciation and amortization | 639,000 | 1,274,000 | |||
Operating income (loss) | 450,000 | 1,026,000 | |||
Interest expense and other, net | (482,000) | (970,000) | |||
Net (loss)/income | (32,000) | 56,000 | |||
Company's share of net (loss)/income | (16,000) | $ 28,000 | |||
RP Maximus Cove LLC [Member] | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Revenues | 3,672,000 | 3,523,000 | 10,905,000 | 8,724,000 | |
Property operating expenses | 1,239,000 | 1,175,000 | 3,660,000 | 3,076,000 | |
General and administrative costs | 41,000 | 54,000 | 136,000 | 196,000 | |
Depreciation and amortization | 2,420,000 | 2,383,000 | 7,214,000 | 6,348,000 | |
Operating income (loss) | (28,000) | (89,000) | (105,000) | (896,000) | |
Interest expense and other, net | (2,833,000) | (2,406,000) | (8,145,000) | (6,161,000) | |
Net (loss)/income | (2,861,000) | (2,495,000) | (8,250,000) | (7,057,000) | |
Company's share of net (loss)/income | (644,000) | (561,000) | (1,856,000) | (1,588,000) | |
Adjustment to depreciation and amortization expense | (10,000) | (180,000) | (87,000) | (479,000) | |
Company's loss from investment | $ (654,000) | $ (741,000) | $ (1,943,000) | $ (2,067,000) |
Investments in Unconsolidated_5
Investments in Unconsolidated Affiliated Real Estate Entities (Details 2) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Hilton Garden Inn [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Members' deficit | $ 25,358 | |
Total liabilities and members' deficit | 60,880 | |
Cash and restricted cash [Member] | Hilton Garden Inn [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity Method Investment, Summarized Financial Information, Assets | 761 | |
Other Assets [Member] | Hilton Garden Inn [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity Method Investment, Summarized Financial Information, Assets | 909 | |
Other Liabilities [Member] | Hilton Garden Inn [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity Method Investment, Summarized Financial Information, Liabilities | 770 | |
Mortgage payable [Member] | Hilton Garden Inn [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity Method Investment, Summarized Financial Information, Liabilities | 34,752 | |
Total assets [Member] | Hilton Garden Inn [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity Method Investment, Summarized Financial Information, Assets | 60,880 | |
Investment property, net [Member] | Hilton Garden Inn [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity Method Investment, Summarized Financial Information, Assets | 59,210 | |
RP Maximus Cove LLC [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity Method Investment, Summarized Financial Information, Liabilities | 154,391 | $ 153,806 |
Members' deficit | (22,893) | (22,558) |
Total liabilities and members' deficit | 154,391 | 153,806 |
RP Maximus Cove LLC [Member] | Cash and restricted cash [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity Method Investment, Summarized Financial Information, Assets | 1,433 | 2,538 |
RP Maximus Cove LLC [Member] | Other Assets [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity Method Investment, Summarized Financial Information, Assets | 2,304 | 1,541 |
RP Maximus Cove LLC [Member] | Other Liabilities [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity Method Investment, Summarized Financial Information, Liabilities | 3,395 | 2,830 |
RP Maximus Cove LLC [Member] | Real Estate [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity Method Investment, Summarized Financial Information, Assets | 150,654 | 149,727 |
RP Maximus Cove LLC [Member] | Mortgage payable [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity Method Investment, Summarized Financial Information, Liabilities | $ 173,889 | $ 173,534 |
Investments in Unconsolidated_6
Investments in Unconsolidated Affiliated Real Estate Entities (Details Textual) - USD ($) | 1 Months Ended | |||
Mar. 27, 2018 | Jan. 31, 2017 | Sep. 30, 2018 | Dec. 31, 2017 | |
Subsequent Event [Line Items] | ||||
Guarantor Obligations, Current Carrying Value | $ 43,800,000 | |||
Debt Instrument, Description of Variable Rate Basis | The Loan bears interest at Libor plus 3.85% through its initial maturity and Libor plus 4.15% during each of the extension periods. | |||
Additional Paid in Capital | $ 115,906,888 | $ 117,061,644 | ||
Joint Venture Investment Property Description | The Cove Joint Venture owns and operates The Cove at Tiburon (“the Cove”), a multi-family complex consisting of 281-units, or 289,690 square feet, contained within 32 apartment buildings over 20.1 acres originally constructed in 1967, located in Tiburon, California. | |||
Refurbishment Guarantee [Member] | ||||
Subsequent Event [Line Items] | ||||
Guarantor Obligations, Current Carrying Value | $ 13,400,000 | |||
Parent Company [Member] | ||||
Subsequent Event [Line Items] | ||||
Guarantor Obligations, Current Carrying Value | 10,900,000 | |||
Cove Transaction [Member] | ||||
Subsequent Event [Line Items] | ||||
Aggregate purchase price | 255,000,000 | |||
Offering funds used in acquisition | 80,000,000 | |||
Proceeds from Issuance of Debt | 175,000,000 | |||
Revenue from Contract with Customer, Including Assessed Tax | $ 600,000 | |||
Business Acquisition Fee Percentage | 1.00% | |||
Cove Transaction [Member] | Parent Company [Member] | ||||
Subsequent Event [Line Items] | ||||
Offering funds used in acquisition | $ 20,000,000 | |||
Business Acquisition, Percentage of Voting Interests Acquired | 22.50% | |||
Additional Paid in Capital | $ 1,700,000 | |||
Hilton Garden Inn [Member] | ||||
Subsequent Event [Line Items] | ||||
Aggregate purchase price | $ 60,000,000 | |||
Offering funds used in acquisition | 25,000,000 | |||
Proceeds from Issuance of Debt | $ 35,000,000 | |||
Business Acquisition, Percentage of Voting Interests Acquired | 50.00% | |||
Hilton Garden Inn [Member] | Parent Company [Member] | ||||
Subsequent Event [Line Items] | ||||
Offering funds used in acquisition | $ 12,900,000 | |||
Business Acquisition, Percentage of Voting Interests Acquired | 50.00% | |||
Revenue from Contract with Customer, Including Assessed Tax | $ 300,000 | |||
Revolving Promissory Note [Member] | Refurbishment Guarantee [Member] | ||||
Subsequent Event [Line Items] | ||||
Guarantor Obligations, Current Carrying Value | $ 3,300,000 | |||
Loan [Member] | ||||
Subsequent Event [Line Items] | ||||
Face amount | $ 175,000,000 | |||
Debt Instrument, Maturity Date | Jan. 31, 2020 |
Marketable Securities and Fai_3
Marketable Securities and Fair Value Measurements (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2017 | |
Debt securities, Fair Value | $ 5,850,369 | $ 0 |
Corporate Bonds and Preferred Securities [Member] | ||
Debt securities, Adjusted Cost | 5,990,267 | |
Debt securities, Gross Unrealized Gains | 0 | |
Debt securities, Gross Unrealized Losses | (139,898) | |
Debt securities, Fair Value | $ 5,850,369 |
Marketable Securities and Fai_4
Marketable Securities and Fair Value Measurements (Details 1) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Due in 1 year | $ 748,125 | |
Due in 1 year through 5 years | 3,166,494 | |
Due in 5 year through 10 years | 1,257,000 | |
Due after 10 years | 678,750 | |
Total | $ 5,850,369 | $ 0 |
Marketable Securities and Fai_5
Marketable Securities and Fair Value Measurements (Details Textual) | 9 Months Ended |
Sep. 30, 2018 | |
Debt Instrument, Basis Spread on Variable Rate | 0.85% |
Debt Instrument Interest Over London Interbank Offered Rate | (3.11%) |
Mortgage payable, net (Details)
Mortgage payable, net (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2017 | |
Long-term Debt, Gross | $ 79,736,142 | $ 87,603,627 |
Less: Deferred financing costs | (403,251) | (700,843) |
Total mortgage payable, net | $ 79,332,891 | 86,902,784 |
Weighted Average Interest Rate | 5.65% | |
Amount Due at Maturity | $ 78,286,986 | |
Revolving Credit Facility [Member] | ||
Long-term Debt, Gross | $ 52,159,414 | 59,696,000 |
Interest Rate | LIBOR + 3.50% | |
Weighted Average Interest Rate | 6.13% | |
Maturity Date | July 2,019 | |
Amount Due at Maturity | $ 52,159,414 | |
Promissory Note [Member] | ||
Long-term Debt, Gross | $ 27,576,728 | $ 27,907,627 |
Weighted Average Interest Rate | 4.73% | |
Maturity Date | October 2,021 | |
Amount Due at Maturity | $ 26,127,572 |
Mortgage payable, net (Details
Mortgage payable, net (Details 1) - USD ($) | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2017 |
Principal maturities, Repayments of Principal in 2018 | $ 114,152 | |||||
Principal maturities, Repayments of Principal in 2019 | $ 52,626,285 | |||||
Principal maturities, Repayments of Principal in 2020 | $ 486,092 | |||||
Principal maturities, Repayments of Principal in 2021 | $ 26,509,613 | |||||
Principal maturities, Repayments of Principal in 2022 | $ 0 | |||||
Principal maturities, Repayments of Principal Thereafter | 0 | |||||
Principal maturities | 79,736,142 | $ 87,603,627 | ||||
Less: Deferred financing costs | (403,251) | (700,843) | ||||
Total principal maturities, net | $ 79,332,891 | $ 86,902,784 |
Mortgage payable, net (Detail_2
Mortgage payable, net (Details Textual) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | |
Jun. 19, 2018 | Mar. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2017 | |
Debt Instrument, Basis Spread on Variable Rate | 0.85% | |||
Revolving Credit Facility [Member] | ||||
Escrow Deposits Related to Debt Compliance | $ 1.7 | $ 1.2 | ||
Debt Instrument, Basis Spread on Variable Rate | 3.50% | 4.95% | ||
Repayments of Secured Debt | $ 7.4 | |||
Secured Debt | $ 52.2 |
Selling Commissions, Dealer M_2
Selling Commissions, Dealer Manager Fees and Other Offering Costs (Details Textual) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended |
Mar. 31, 2017 | Mar. 31, 2017 | |
Related Party Transaction [Line Items] | ||
Selling commissions and dealer manager fees | $ 12.2 | $ 1.7 |
Debt Related Commitment Fees and Debt Issuance Costs | $ 4.8 | $ 0.1 |
Related Party Transactions (Det
Related Party Transactions (Details) - Advisor [Member] - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | ||
Related Party Transaction [Line Items] | |||||
Acquisition fees | [1] | $ 0 | $ 0 | $ 300,000 | $ 573,750 |
Development fees | [2] | 0 | 0 | 51,419 | 0 |
Asset Management Fees (general and administrative costs) | 447,135 | 382,022 | 1,271,867 | 704,640 | |
Total | $ 447,135 | $ 382,022 | $ 1,623,286 | $ 1,278,390 | |
[1] | Acquisition fees of $300,000 and $573,750 were capitalized and are reflected in the carrying value of our investments in the Hilton Garden Inn Joint Venture and the Cove Joint Venture, respectively, which are included in investments in unconsolidated affiliated real estate entities on the consolidated balance sheets. | ||||
[2] | Generally, capitalized and amortized over the estimated useful life of the associated asset. |
Related Party Transactions (D_2
Related Party Transactions (Details Textual) - USD ($) | Sep. 30, 2018 | Sep. 30, 2017 |
Related Party Transaction [Line Items] | ||
Capitalized Acquisition Related Costs | $ 300,000 | $ 573,750 |
Financial Instruments (Details)
Financial Instruments (Details) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Mortgages payable, Carrying Amount | $ 79,736,142 | $ 87,603,627 |
Mortgages payable, Estimated Fair Value | $ 78,418,087 | $ 86,729,748 |
Distributions (Details Textual)
Distributions (Details Textual) - USD ($) | Nov. 13, 2018 | Sep. 30, 2018 | Aug. 31, 2018 | Jul. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2017 |
Distributions [Line Items] | ||||||
Distribution paid | $ 2,000,000 | $ 2,000,000 | $ 2,000,000 | $ 6,110,513 | $ 4,749,947 | |
Number of days used to calculate daily amount of distribution | 365 days | |||||
Subsequent Event [Member] | ||||||
Distributions [Line Items] | ||||||
Distribution on per day basis | $ 0.00164383 | |||||
Annualized rate of dividend | 6.00% | |||||
Face value of share | $ 10 |