Document_And_Entity_Informatio
Document And Entity Information | 6 Months Ended | |
Jun. 30, 2014 | Aug. 11, 2014 | |
Document And Entity Information [Abstract] | ' | ' |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 30-Jun-14 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q2 | ' |
Entity Registrant Name | 'Carter Validus Mission Critical REIT II, Inc. | ' |
Entity Central Index Key | '0001567925 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Non-accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 336,075 |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
ASSETS | ' | ' |
Cash and cash equivalents | $102,000 | $200,000 |
Other assets | 140,233 | ' |
Total assets | 242,233 | 200,000 |
Liabilities: | ' | ' |
Accounts payable due to affiliates | 30,739 | ' |
Accounts payable and other liabilities | 64,689 | ' |
Total liabilities | 95,428 | ' |
Stockholder's equity: | ' | ' |
Preferred stock, $0.01 par value per share, 100,000,000 and 50,000,000 shares authorized as of June 30, 2014 and December 31, 2013, respectively; none issued and outstanding | ' | ' |
Additional paid-in capital | 199,800 | 199,800 |
Accumulated loss | -54,656 | ' |
Total stockholder's equity | 145,344 | 200,000 |
Noncontrolling interests | 1,461 | ' |
Total equity | 146,805 | 200,000 |
Total liabilities and stockholder's equity | 242,233 | 200,000 |
Class A shares [Member] | ' | ' |
Stockholder's equity: | ' | ' |
Common stock, value, issued | 200 | 200 |
Class T shares [Member] | ' | ' |
Stockholder's equity: | ' | ' |
Common stock, value, issued | ' | ' |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets (Parenthetical) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Preferred stock, par value | $0.01 | $0.01 |
Preferred stock, shares authorized | 100,000,000 | 50,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $0.01 | ' |
Common stock, shares authorized | 500,000,000 | ' |
Class A shares [Member] | ' | ' |
Common stock, par value | $0.01 | $0.01 |
Common stock, shares authorized | 250,000,000 | 300,000,000 |
Common stock, shares issued | 20,000 | 20,000 |
Common stock, shares outstanding | 20,000 | 20,000 |
Class T shares [Member] | ' | ' |
Common stock, par value | $0.01 | $0.01 |
Common stock, shares authorized | 250,000,000 | 0 |
Common stock, shares issued | 0 | 0 |
Common stock, shares outstanding | 0 | 0 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statement of Operations (USD $) | 3 Months Ended | 6 Months Ended |
Jun. 30, 2014 | Jun. 30, 2014 | |
Expenses: | ' | ' |
General and administrative expenses | $18,635 | $18,635 |
Acquisition related expenses | 36,560 | 36,560 |
Total expenses | 55,195 | 55,195 |
Consolidated net loss | -55,195 | -55,195 |
Net loss attributable to noncontrolling interests in consolidated partnership | 539 | 539 |
Net loss attributable to the Company | ($54,656) | ($54,656) |
Class A shares [Member] | ' | ' |
Weighted average number of common shares outstanding: | ' | ' |
Basic and diluted | 20,000 | 20,000 |
Net loss per common share: | ' | ' |
Basic and diluted | ($2.73) | ($2.73) |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statement Of Stockholder's Equity (USD $) | Class A shares [Member] | Total Stockholder's Equity [Member] | Additional Paid in Capital [Member] | Accumulated Loss [Member] | Noncontrolling Interests [Member] | Total |
Common Stock [Member] | ||||||
Balance, at Dec. 31, 2013 | $200 | $200,000 | $199,800 | ' | ' | $200,000 |
Balance, shares at Dec. 31, 2013 | 20,000 | ' | ' | ' | ' | ' |
Issuance of noncontrolling interests | ' | ' | ' | ' | 2,000 | 2,000 |
Accumulated loss | ' | -54,656 | ' | -54,656 | -539 | -55,195 |
Balance, at Jun. 30, 2014 | $200 | $145,344 | $199,800 | ($54,656) | $1,461 | $146,805 |
Balance, shares at Jun. 30, 2014 | 20,000 | ' | ' | ' | ' | ' |
Condensed_Consolidated_Stateme2
Condensed Consolidated Statement Of Cash Flow (USD $) | 6 Months Ended |
Jun. 30, 2014 | |
Cash flows from operating activities: | ' |
Consolidated net loss | ($55,195) |
Changes in operating assets and liabilities: | ' |
Accounts payable and other liabilities | 41,670 |
Accounts payable due to affiliates | 30,739 |
Other assets | -17,214 |
Net cash provided by operating activities | ' |
Cash flows from investing activities: | ' |
Payments of real estate deposits | -100,000 |
Net cash used in investing activities | -100,000 |
Cash flows from financing activities: | ' |
Proceeds from noncontrolling interests in Operating Partnership | 2,000 |
Net cash provided by financing activities | 2,000 |
Net change in cash | -98,000 |
Cash and cash equivalents - Beginning of period | 200,000 |
Cash and cash equivalents - End of period | $102,000 |
Organization_and_Business_Oper
Organization and Business Operations | 6 Months Ended |
Jun. 30, 2014 | |
Organization and Business Operations [Abstract] | ' |
Organization and Business Operations | ' |
Note 1—Organization and Business Operations | |
Carter Validus Mission Critical REIT II, Inc., or the Company, incorporated on January 11, 2013, is a newly formed Maryland corporation that intends to qualify as a real estate investment trust, or a REIT, under the Internal Revenue Code of 1986, as amended, or the Code, for federal income tax purposes commencing with its taxable year ending December 31, 2014, or the first year in which the Company commences material operations, if later. For the period from January 11, 2013 through December 31, 2013, the Company had not begun principal operations. Substantially all of the Company’s business is expected to be conducted through Carter Validus Operating Partnership II, LP, a Delaware limited partnership, or the Operating Partnership, formed on January 10, 2013. The Company is the sole general partner of the Operating Partnership and Carter Validus Advisors II, LLC, or the Advisor, is the initial limited partner of the Operating Partnership. The Company owns a 99.01% interest in the Operating Partnership and the Advisor owns a .99% interest in the Operating Partnership. On January 31, 2013, the Company issued 20,000 shares of common stock in a private placement to Carter Validus REIT Management Company II, LLC, a Florida limited liability company, or the Sponsor, at a purchase price of $10.00 per share, for an aggregate purchase price of $200,000. Subsequently, the shares were reclassified as Class A shares of common stock. The Company contributed the proceeds from that sale to the Operating Partnership for 20,000 general partnership units of the Operating Partnership. | |
The Company is offering for sale a maximum of $2,250,000,000 in shares of common stock (exclusive of $100,000,000 of shares of common stock to be made available pursuant to the Company’s distribution reinvestment plan, or the DRIP) in a primary offering on a “best efforts” basis pursuant to a registration statement on Form S-11 filed with the Securities and Exchange Commission, or the SEC, under the Securities Act of 1933, as amended, or the Offering (Commission File Number: 333-191706). The Company is offering two classes of shares of common stock, Class A shares and Class T shares, in any combination with a dollar value up to the maximum offering amount. The initial offering price for the shares in the primary offering shall be $10.00 per Class A share and $9.574 per Class T share. | |
Pursuant to the escrow agreement by and among the Company, SC Distributors, LLC, or SC Distributors, the affiliated Dealer-Manager of the Offering, and UMB Bank, N.A., as escrow agent, or the Escrow Agreement, the Company is required to deposit all subscription proceeds in escrow until the Company receives subscriptions aggregating $2,000,000, excluding subscriptions from affiliates and from residents of Pennsylvania and Washington. As of July 3, 2014, the Company had satisfied these conditions. As of July 3, 2014, the Company had accepted investors’ subscriptions for and issued approximately 213,333 shares of Class A common stock in the Offering, resulting in receipt of gross proceeds of approximately $2,000,000. In addition, the Company has special escrow requirements for subscriptions from residents of Pennsylvania and Washington, the conditions of which, to date, have not been satisfied. As of July 3, 2014, the Company had approximately $2,248,000,000 in Class A shares and Class T shares of common stock remaining in the Offering. | |
Substantially all of the Company’s business is managed by the Advisor. Carter Validus Real Estate Management Services II, LLC, or the Property Manager, an affiliate of the Advisor, serves as the Company’s property manager. SC Distributors, LLC, or the Dealer Manager, an affiliate of the Advisor, serves as the dealer manager of the Offering. These entities will receive fees during the offering, acquisition, operational and liquidation stages. | |
The Company was formed to invest primarily in quality income-producing commercial real estate, with a focus on medical facilities and data centers, preferably with long-term net leases to investment grade and other creditworthy tenants, as well as to make other real estate investments that relate to such property types. Other real estate investments may include equity or debt interests, including securities, in other real estate entities. The Company also may originate or invest in real estate-related debt. The Company expects real estate-related debt originations and investments to be focused on first mortgage loans, but also may include real estate-related bridge loans, mezzanine loans and securitized debt. | |
As of June 30, 2014, neither the Company nor the Operating Partnership had purchased any properties or other investments. See Note 9—“Subsequent Events—Acquisition of the Cy Fair Surgical Center.” | |
Except as the context otherwise requires, “we,” “our,” “us,” and the “Company” refer to Carter Validus Mission Critical REIT II, Inc. and the Operating Partnership. | |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 6 Months Ended | ||
Jun. 30, 2014 | |||
Summary of Significant Accounting Policies [Abstract] | ' | ||
Summary of Significant Accounting Policies | ' | ||
Note 2—Summary of Significant Accounting Policies | |||
The accompanying condensed consolidated unaudited financial statements of the Company have been prepared in accordance with the generally accepted accounting principles in the United States, or GAAP, for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, all adjustments, consisting of normal and recurring nature considered necessary for a fair presentation have been included. Operating results for the three and six months ended June 30, 2014 are not necessarily indicative of the results that may be expected for the year ending December 31, 2014. | |||
Principles of Consolidation and Basis of Presentation | |||
For the period from January 11, 2013 through December 31, 2013, the Company had not begun principal operations. The accompanying condensed consolidated unaudited financial statements include the accounts of the Company and the Operating Partnership. All intercompany accounts and transactions have been eliminated. | |||
Use of Estimates | |||
The preparation of the financial statements and accompanying notes in conformity with GAAP requires the Company to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. These estimates are made and evaluated on an on-going basis using information that is currently available as well as various other assumptions believed to be reasonable under the circumstances. Actual results could differ from those estimates. | |||
Cash and Cash Equivalents | |||
The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Cash equivalents may include cash and short-term investments. Short-term investments are stated at cost, which approximates fair value. | |||
Real Estate Investments | |||
Depreciation | |||
Real estate costs related to the acquisition, development, construction and improvement of properties will be capitalized. Repair and maintenance costs will be charged to expense as incurred and significant replacements and betterments will be capitalized. Repair and maintenance costs will include all costs that do not extend the useful life of the real estate asset. The Company will consider the period of future benefit of an asset in determining the appropriate useful life. The Company anticipates the estimated useful lives of its assets by class will be generally as follows: | |||
Buildings and improvements | 15 – 40 years | ||
Tenant improvements | Shorter of lease term or expected useful life | ||
Tenant origination and absorption costs | Remaining term of related lease | ||
Furniture, fixtures, and equipment | 3 – 10 years | ||
Allocation of Purchase Price of Real Estate and Related Assets | |||
Upon the acquisition of real properties determined to be business combinations, the Company will allocate the purchase price of properties to acquired tangible assets, consisting of land, buildings and improvements, and identified intangible assets and liabilities, consisting of the value of above-market and below-market leases and the value of in-place leases, based in each case on their estimated fair values. | |||
The fair values of the tangible assets of an acquired property (which includes land, buildings and improvements) will be determined by valuing the property as if it were vacant, and the “as-if-vacant” value will be allocated to land and building based on management’s determination of the relative fair value of these assets. Management will determine the as-if-vacant fair value of a property using methods similar to those used by independent appraisers. Factors considered by management in performing these analyses will include an estimate of carrying costs during the expected lease-up periods considering current market conditions and costs to execute similar leases, including leasing commissions and other related costs. In estimating carrying costs, management will include real estate taxes, insurance, and other operating expenses during the expected lease-up periods based on current market conditions. | |||
The fair values of above-market and below-market in-place lease values will be recorded based on the present value (using an interest rate which reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to the in-place leases and (ii) an estimate of fair market lease rates for the corresponding in-place leases, measured over a period equal to the remaining non-cancelable term of the lease including any bargain renewal periods, with respect to a below-market lease. The above-market and below-market lease values will be capitalized as intangible lease assets or liabilities. Above-market lease values will be amortized as an adjustment of rental income over the remaining terms of the respective leases. Below-market leases will be amortized as an adjustment of rental income over the remaining terms of the respective leases, including any bargain renewal periods. If a lease were to be terminated prior to its stated expiration, all unamortized amounts of above-market and below-market in-place lease values relating to that lease would be recorded as an adjustment to rental income. | |||
The fair values of in-place leases will include direct costs associated with obtaining a new tenant, opportunity costs associated with lost rentals that are avoided by acquiring an in-place lease, and tenant relationships. Direct costs associated with obtaining a new tenant include commissions, tenant improvements, and other direct costs and will be estimated based on management’s consideration of current market costs to execute a similar lease. These direct lease origination costs will be included in real estate assets in the accompanying consolidated balance sheets and will be amortized to expense over the remaining terms of the respective leases. The value of opportunity costs will be calculated using the contractual amounts to be paid pursuant to the in-place leases over a market absorption period for a similar lease. These lease intangibles will be included in real estate assets in the accompanying condensed consolidated balance sheets and amortized to expense over the remaining terms of the respective leases. If a lease were to be terminated prior to its stated expiration, all unamortized amounts of in-place lease assets relating to that lease would be expensed. | |||
Impairment of Long Lived Assets | |||
The Company will continually monitor events and changes in circumstances that could indicate that the carrying amounts of its real estate and related intangible assets may not be recoverable. When indicators of potential impairment suggest that the carrying value of real estate and related intangible assets may not be recoverable, the Company will assess the recoverability of the assets by estimating whether the Company will recover the carrying value of the asset through its undiscounted future cash flows and its eventual disposition. If based on this analysis the Company does not believe that it will be able to recover the carrying value of the asset, the Company will record an impairment loss to the extent that the carrying value exceeds the estimated fair value of the asset. | |||
Real Estate-Related Notes Receivables | |||
The Company may invest in real estate-related notes receivables that represent loans that the Company intends to hold to maturity. They will be classified as real estate-related notes receivables. Accordingly, these notes will be recorded at cost, net of unamortized loan origination costs and fees, loan purchase discounts, and allowance for losses when a loan is determined to be impaired. Premiums, discounts, and net origination fees will be amortized or accreted as an adjustment to interest income using the effective interest method over the life of the loan. | |||
The Company will evaluate the collectability of both interest and principal on each real estate-related note receivable to determine whether it is collectible, primarily through the evaluation of credit quality indicators such as underlying collateral and payment history. A real estate-related note receivable will be considered to be impaired when, based upon current information and events, it is probable that the Company will be unable to collect all amounts due according to the existing contractual terms. If a real estate-related note receivable is considered to be impaired, the amount of loss will be calculated by comparing the recorded investment to the value determined by discounting the expected future cash flows at the real estate-related note receivable’s effective interest rate or to the value of the underlying collateral if the real estate-related note receivable is collateral dependent. | |||
Rents and Other Receivables | |||
The Company will evaluate the collectability of amounts due from tenants at each balance sheet date and maintain an allowance for doubtful accounts for estimated losses resulting from the inability of tenants to make required payments under lease agreements. The Company will exercise judgment in establishing these allowances and consider payment history and current credit status of its tenants in developing these estimates. | |||
Noncontrolling Interest in Operating Partnership | |||
The Company is the sole general partner of the Operating Partnership and the Advisor is the initial limited partner of the Operating Partnership. The Company owns a 99.01% interest in the Operating Partnership and the Advisor owns a .99% interest in the Operating Partnership. The Company consolidates the Operating Partnership and reports unaffiliated partners’ interests in the Operating Partnership as noncontrolling interests. Noncontrolling interests are reported within the equity section of the consolidated financial statements, and amounts attributable to controlling and noncontrolling interests are reported separately in the accompanying condensed consolidated statement of operations and accompanying condensed consolidated statement of stockholder’s equity. | |||
Revenue Recognition | |||
The Company will recognize revenue when all four of the following basic criteria are met before revenue is realized or realizable and earned: (1) there is persuasive evidence that an arrangement exists; (2) delivery has occurred or services have been rendered; (3) the seller’s price to the buyer is fixed and determinable; and (4) collectability is reasonably assured. | |||
Rental Revenue | |||
In accordance with ASC Topic 840, Leases, minimum rental revenue will be recognized on a straight-line basis over the term of the related lease (including rent holidays). Differences between rental income recognized and amounts contractually due under the lease agreements will be credited or charged to deferred rent receivable or deferred rent liability, as applicable. Tenant reimbursement revenue, which will be comprised of additional amounts recoverable from tenants for common area maintenance expenses and certain other recoverable expenses, will be recognized as revenue in the period in which the related expenses are incurred. | |||
Interest Income | |||
Interest income on performing real estate-related notes receivables will be accrued as earned. Interest income on an impaired real estate-related note receivable will be recognized on a cash basis. Fees related to the buy down of the interest rate will be deferred as prepaid interest income and amortized over the term of the loan as an adjustment to interest income using the effective interest method. Closing costs related to the purchase of the real estate-related note receivable will be amortized over the term of the loan and accreted as an adjustment against interest income using the effective interest method. | |||
Accounting for Stock-Based Compensation | |||
The Company will account for stock-based compensation based upon the estimated fair value of the share awards. Accounting for stock-based compensation requires the fair value of the awards to be amortized as compensation expense over the period for which the services relate and requires any dividend equivalents earned to be treated as dividends for financial reporting purposes. | |||
Earnings Per Share | |||
The Company calculates basic earnings per share by dividing net income (loss) for the period by the weighted-average shares of its common stock outstanding for that period. As of June 30, 2014, the Company had 20,000 weighted-average shares of Class A common stock outstanding. | |||
Deferred Financing Cost | |||
Deferred financing costs are loan fees, legal fees and other third-party costs associated with obtaining financing. These costs are amortized over the terms of the respective financing agreements using the effective interest method. Unamortized deferred financing costs are generally expensed when the associated debt is refinanced or repaid before maturity unless specific rules are met that would allow for the carryover of such costs to the refinanced debt. Costs incurred in seeking financing transactions that do not close are expensed in the period in which it is determined that the financing will not close. As of June 30, 2014, the Company’s deferred financing costs were $23,019 and related to the Company’s credit facility agreement, which was entered into on July 31, 2014. See Note 9—“Subsequent Events—Credit Facility” for a discussion on the Company’s credit facility agreement. Deferred financing costs are reported in other assets in the accompanying condensed consolidated balance sheets. | |||
Derivative Instruments and Hedging Activities | |||
The Company may enter into derivative contracts to add stability to future cash flows by managing its exposure to interest rate movements. The Company may utilize derivative instruments, including interest rate swaps, to effectively convert a portion of its variable rate debt to fixed rate debt. The Company will not enter into derivative instruments for speculative purposes. | |||
The Company will account for its derivative instruments in accordance with ASC Topic 815, Derivatives and Hedging, or ASC 815, which requires companies to recognize all of its derivative instruments as either assets or liabilities in the statement of financial position at fair value. The accounting for changes in the fair value of a derivative instrument depends on whether it has been designated and qualifies as part of a hedging relationship and further, on the type of hedging relationship. For those derivative instruments that are designated and qualify as hedging instruments, a company must designate the hedging instrument, based upon the exposure being hedged, as a fair value hedge, cash flow hedge or a hedge of a net investment in a foreign operation. For derivative instruments not designated as hedging instruments, the gain or loss is recognized in the statement of operations during the current period. | |||
In accordance with ASC 815, the Company will designate interest rate swap contracts as cash flow hedges of floating-rate borrowings. For derivative instruments that are designated and qualify as cash flow hedges, the effective portion of the gain or loss on the derivative instrument will be reported as a component of other comprehensive income and reclassified into earnings in the same line item associated with the forecasted transaction and in the same period during which the hedged transaction affects earnings. The ineffective portion of the gain or loss on the derivative instruments will be recognized in the statement of operations during the current period. | |||
Distribution Policy | |||
The Company intends to elect to be taxed as a REIT and to operate as a REIT beginning with its taxable year ending December 31, 2014, or the first year in which the Company commences material operations, if later. To qualify and maintain its qualification as a REIT, the Company intends to make distributions each taxable year equal to at least 90% of its REIT taxable income (which is determined without regard to the dividends paid deduction or net capital gain and which does not necessarily equal net income as calculated in accordance with GAAP). The Company expects to authorize and declare daily distributions that will be paid on a monthly basis. See Note 9—“Subsequent Events—Distributions” for distributions approved by the board of directors on July 16, 2014. | |||
Distributions to stockholders will be determined by the board of directors of the Company and will be dependent upon a number of factors relating to the Company, including funds available for the payment of distributions, financial condition, the timing of property acquisitions, capital expenditure requirements, and annual distribution requirements in order to maintain the Company’s status as a REIT under the Code. | |||
Concentration of Credit Risk | |||
At June 30, 2014 and December 31, 2013, the Company had no cash on deposit in excess of federally insured levels. The Company limits investment of cash investments to financial institutions with high credit standing; therefore, the Company believes it is not exposed to any significant credit risk on cash. There were no restrictions on the use of the Company’s cash as of June 30, 2014 and December 31, 2013. | |||
Income Taxes | |||
The Company intends to elect and qualify to be taxed as a REIT, commencing with its taxable year ending December 31, 2014, or the first year in which the Company commences material operations, if later. Accordingly, it will generally not be subject to corporate U.S. federal or state income tax to the extent that it makes qualifying distributions to stockholders, and provided it satisfies, on a continuing basis, through actual investment and operating results, the REIT requirements, including certain asset, income, distribution and stock ownership tests. If the Company fails to qualify as a REIT, and does not qualify for certain statutory relief provisions, it will be subject to U.S. federal, state and local income taxes and may be precluded from qualifying as a REIT for the subsequent four taxable years following the year in which it lost its REIT qualification, unless the Internal Revenue Service grants the Company relief under certain statutory provisions. Accordingly, failure to qualify as a REIT could have a material adverse impact on the results of operations and amounts available for distributions to stockholders. | |||
The dividends paid deduction of a REIT for qualifying dividends paid to its stockholders is computed using the Company’s taxable income as opposed to net income reported in the financial statements. Taxable income, generally, will differ from net income reported in the financial statements because the determination of taxable income is based on tax provisions and not financial accounting principles. | |||
The Company has concluded that there was no impact related to uncertain tax provisions from results of operations of the Company for the three and six months ended June 30, 2014. The United States of America is the major jurisdiction for the Company, and the earliest tax year subject to examination will be 2014. | |||
Recently Issued Accounting Pronouncements | |||
In April 2014, the Financial Accounting Standards Board, or the FASB, issued ASU 2014-08, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity, or ASU 2014-08. ASU 2014-08 changes the criteria for reporting discontinued operations while enhancing disclosures in this area. Under the new guidance, only disposals representing a strategic shift in operations should be presented as discontinued operations. Those strategic shifts should have a major effect on the company’s operations and financial results. Examples include a disposal of a major geographic area, a major line of business, or a major equity method investment. Additionally, the new guidance requires expanded disclosures about discontinued operations that will provide financial statement users with more information about the assets, liabilities, income, and expenses of discontinued operations. The adoption of ASU 2014-08 is effective prospectively for reporting periods beginning on or after December 15, 2014. The Company does not expect the adoption of ASU 2014-08 to have a material effect on the Company’s condensed consolidated financial statements. | |||
In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers, or ASU 2014-09. The objective of ASU 2014-09 is to clarify the principles for recognizing revenue and to develop a common revenue standard for GAAP. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods and services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The adoption of ASU 2014-09 is effective retrospectively for reporting periods beginning after December 15, 2017. Early adoption of ASU 2014-09 is not permitted. The Company is in the process of evaluating the impact ASU 2014-09 will have on the Company’s condensed consolidated financial statements. | |||
In June 2014, the FASB issued ASU 2014-12, Accounting for Share-Based Payments When the Terms of and Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period, or ASU 2014-12. The objective of ASU 2014-12 is to clarify the proper method of accounting for share-based payments when the terms of an award provide that a performance target could be achieved after the requisite service period. Under ASU 2014-12, a performance target that affects vesting and could be achieved after completion of the service period should be treated as a performance condition under FASB Accounting Standards Codification Topic 718, Compensation—Stock Compensation, and, as a result, should not be included in the estimation of the grant-date fair value of the award. An entity should recognize compensation cost for the award when it becomes probable that the performance target will be achieved. The adoption of ASU 2014-12 is effective for annual periods and interim periods beginning after December 15, 2015. Early adoption is permitted. The Company does not expect the adoption of ASU 2014-12 to have a material effect on the Company’s condensed consolidated financial statements. | |||
Other_Assets
Other Assets | 6 Months Ended | |||||
Jun. 30, 2014 | ||||||
Other Assets [Abstract] | ' | |||||
Other Assets | ' | |||||
Note 3 — Other Assets | ||||||
Other assets consisted of the following as of June 30, 2014 and December 31, 2013: | ||||||
30-Jun-14 | 31-Dec-13 | |||||
Real estate escrow deposits | $ | 100,000 | $ | — | ||
Deferred financing costs | 23,019 | — | ||||
Prepaid assets | 17,214 | — | ||||
$ | 140,233 | $ | — | |||
Stockholders_Equity
Stockholder's Equity | 6 Months Ended |
Jun. 30, 2014 | |
Stockholder's Equity [Abstract] | ' |
Stockholder's Equity | ' |
Note 4 — Stockholder’s Equity | |
General | |
The Company’s charter authorizes the issuance of up to 600,000,000 shares of stock, consisting of 500,000,000 shares of common stock, $0.01 par value per share, and 100,000,000 shares of preferred stock, $0.01 par value per share. The company intends to issue $2,250,000,000 in Class A and Class T shares of common stock in its primary offering, and $100,000,000 in Class A and Class T shares of common stock pursuant to a distribution reinvestment plan at 95% of the purchase price per share. Other than the differing fees with respect to each class and the payment of a distribution fee out of cash otherwise distributable to Class T stockholders, Class A shares and Class T shares have identical rights and privileges, such as identical voting rights. The net proceeds from the sale of the two classes of shares will be commingled for investment purposes and all earnings from all of the investments will proportionally accrue to each share regardless of the class. | |
The shares of common stock entitle the holders to one vote per share on all matters upon which stockholders are entitled to vote, to receive distributions as may be authorized by the Company’s board of directors, to receive all assets available for distribution to stockholders in accordance with the Maryland General Corporation Law and to all other rights of a stockholder pursuant to the Maryland General Corporation Law. The common stock has no preferences, preemptive, conversion, exchange, sinking fund or redemption rights. | |
The charter authorizes the Company’s board of directors, without stockholder approval, to designate and issue one or more classes or series of preferred stock and to set or change the voting, conversion or other rights, preferences, restrictions, limitations as to dividends or other distributions and qualification or terms or conditions of redemption of each class of stock so issued. As of June 30, 2014 and December 31, 2013, no shares of the Company’s preferred stock were issued and outstanding. | |
Distribution Reinvestment Plan | |
The Company has adopted a DRIP through which the Company’s stockholders, and, subject to certain conditions set forth in the DRIP, any stockholder or partner of any other publicly offered limited partnership, real estate investment trust or other real estate program sponsored by the Advisor, or its affiliates, may elect to purchase shares of the Company’s common stock with distributions from the Company or distributions from such other programs. The Company will discontinue sales of shares under the DRIP on the earlier of the date the Company sells all the shares registered for sale under the DRIP and two years from the effective date of the Offering, unless the Company elects to extend such date. The Company may reallocate the shares of common stock between the primary offering and the DRIP. | |
Participants purchasing shares pursuant to the DRIP will have the same rights as stockholders with respect to shares purchased under the DRIP and will be treated in the same manner as if such shares were issued pursuant to the Offering. No selling commissions, dealer manager fees or distribution fees will be paid with respect to shares purchased pursuant to the DRIP. At its discretion, the Company may amend, suspend or terminate the DRIP or a participant’s individual participation in the DRIP upon ten days’ notice. | |
Distributions | |
After the Company raises the minimum offering amount, it intends to make regular cash distributions to stockholders. It is the Company’s intent to fund such distributions from cash flow from operations. However, if the Company is unable to do so, it will look to other sources including borrowings, advances from the Advisor, the Advisor’s deferral, suspension and/or waiver of its fees and expense reimbursements, and offering proceeds. The board of directors will determine the amount of the distributions to stockholders. The board’s determination will be based on a number of factors, including funds available from operations, capital expenditure requirements, requirements of Maryland law and the annual distribution requirements necessary to maintain the Company’s REIT status under the Code. As a result, the distribution rate and payment frequency may vary from time to time. However, to qualify as a REIT under the Code, the Company must make distributions equal to at least 90% of its REIT taxable income, determined without regard to the dividends-paid deduction and excluding net capital gain, each year. See Note 9—“Subsequent Events—Distributions” for distributions approved by the board of directors on July 16, 2014. | |
RelatedParty_Transactions_and_
Related-Party Transactions and Arrangements | 6 Months Ended | ||||||||
Jun. 30, 2014 | |||||||||
Related-Party Transactions and Arrangements [Abstract] | ' | ||||||||
Related-Party Transactions and Arrangements | ' | ||||||||
Note 5 — Related-Party Transactions and Arrangements | |||||||||
The Company executed an advisory agreement with the Advisor, a dealer manager agreement with the Dealer Manager and a property management and leasing agreement with the Property Manager, which will entitle the Advisor, certain affiliates of the Advisor and the Dealer Manager to specified fees upon the provision of certain services with regard to the Offering and the investment of funds in real estate assets, among other services, as well as reimbursement of organization and offering expenses incurred by the Advisor and the Dealer Manager on behalf of the Company and certain other operating costs incurred by the Advisor in providing services to the Company. The fees and reimbursement obligations are as follows: | |||||||||
Type of Compensation/Affiliate | Determination of Amount | ||||||||
Offering Stage | |||||||||
Selling Commission – Dealer Manager | The Company will pay the Dealer Manager selling commissions of up to 7.0% of the gross offering proceeds per Class A share and up to 3.0% of gross offering proceeds per Class T share. All of the sales commissions are expected to be re-allowed to participating broker-dealers. | ||||||||
The Company will not pay selling commissions with respect to shares of any class sold pursuant to the DRIP. | |||||||||
Dealer Manager Fee – Dealer Manager | The Company will pay the Dealer Manager a dealer manager fee of up to 3.0% of gross offering proceeds from the sale of Class A and Class T shares, provided, however that the dealer manager fee the Company pays on the Class T shares may be changed in the future. The dealer manager fee may be partially re-allowed to participating broker-dealers. No dealer manager fees will be paid in connection with purchases of shares made pursuant to the DRIP. | ||||||||
Distribution Fee – Dealer Manager | The Company will pay the Dealer Manager a distribution fee with respect to its Class T shares that are sold in the Offering that accrues daily in an amount equal to 1/365th of .80% of the amount of the purchase price per share (or, once reported, the net asset value per share for such day) on a continuous basis from year to year. Termination of such payment will commence on the earlier to occur of the following: (i) a listing of the Class T shares on a national securities exchange, (ii) following the completion of the Offering, total underwriting compensation in the Offering equaling 10% of the gross proceeds from the primary portion of the Offering, or (iii) such Class T shares no longer being outstanding. The Dealer Manager may re-allow the distribution fee to participating broker-dealers and servicing broker-dealers. The distribution fee will be paid monthly in arrears. The distribution fee will not be payable with respect to Class T shares issued under the DRIP. | ||||||||
The Company will not pay a distribution fee with respect to Class A shares. | |||||||||
Organization and Offering Expenses – Advisor | The Company will reimburse the Advisor and its affiliates for organization and offering expenses it incurs on the Company’s behalf, but only to the extent the reimbursement would not cause the selling commissions, dealer manager fees, distribution fees and other organization and offering expenses to exceed 15% of the gross offering proceeds of the Offering. The Company expects that organization and offering expenses (other than selling commissions, dealer manager fees, and distribution fees) will be approximately 1.25% of the gross offering proceeds. | ||||||||
Operational Stage | |||||||||
Acquisition Fees – Advisor | The Company will pay to the Advisor 2.0% of the contract purchase price of each property or asset acquired and 2.0% of the amount advanced with respect to a mortgage loan. The total amount of all acquisition fees and expenses are limited to 6.0% of the contract purchase price of the property or in the case of a mortgage loan, 6.0% of funds advanced. The contract purchase price is the amount actually paid or allocated in respect of the purchase, development, construction or improvement of a property or the amount of funds advanced with respect to a mortgage loan, exclusive of acquisition fees and acquisition expenses. | ||||||||
Acquisition Expenses – Advisor | The Company will reimburse the Advisor for acquisition expenses incurred in connection with the selection and acquisition of properties or other real estate-related investments (including expenses relating to potential investments that the Company does not close), such as legal fees and expenses, costs of real estate due diligence, appraisals, non-refundable option payments on property not acquired, travel and communications expenses, accounting fees and expenses and title insurance premiums, whether or not the property was acquired. The total amount of all acquisition fees and expenses are limited to 6.0% of the contract purchase price of the property or in the case of a mortgage loan, 6.0% of funds advanced. The Company expects these expenses will be approximately 0.75% of the purchase price of each property or real estate-related investment. | ||||||||
Asset Management Fee – Advisor | The asset management fee will be calculated on a monthly basis in an amount equal to 1/12th of 0.75% of gross assets (including amounts borrowed) and is payable monthly in arrears. The Advisor may, in its sole discretion, choose to take any monthly asset management fee in the form of subordinated restricted Class B Units of the Operating Partnership. In the event the Advisor chooses to be compensated in Class B Units, then the Operating Partnership will, within 30 days after the end of the applicable month (subject to the approval of the board of directors), issue a number of restricted Class B Units to the Advisor equal to: (i) the cost of assets multiplied by 0.0625% (or the lower of the cost of assets and the applicable quarterly net asset value, or NAV, multiplied by 0.0625%, once the Company begins calculating NAV) divided by (ii) the value of one Class A share of common stock as of the last day of such calendar month, which will be the offering price, less selling commissions and dealer manager fees, until such time as the Company calculates NAV, when it will then be the per share NAV for Class A shares. | ||||||||
The Advisor will be entitled to receive certain distributions of net sales proceeds on the vested and unvested Class B Units it receives in connection with its assets management services at the same rate as distributions received on the Company’s common stock. Such distributions will be in addition to the incentive fees the Advisor and its affiliates may receive from the Company, including, without limitation the subordinated participation in net sales proceeds, the subordinated incentive listing distribution or the subordinated distribution upon termination of the advisory agreement, as applicable. | |||||||||
Class B Units are subject to forfeiture until such time as: (a) the value of the Operating Partnership’s assets plus all distributions made equals or exceeds the total amount of capital contributed by investors plus a 6.0% cumulative, pretax, non-compounded annual return thereon, or the economic hurdle; (b) any one of the following events occurs concurrently with or subsequently to the achievement of the economic hurdle described above: (i) a listing of the Company’s common stock on a national securities exchange; (ii) a transaction to which the Company or the Operating Partnership shall be a party, as a result of which operating partnership units or common stock shall be exchanged for or converted into the right, or the holders of such securities shall otherwise be entitled, to receive cash, securities or other property or any combination thereof; or (iii) the termination of the advisory agreement without cause; and (c) the advisor pursuant to the advisory agreement is providing services to the Company immediately prior to the occurrence of an event of the type described in clause (b) above, unless the failure to provide such services is attributable to the termination without cause of the advisory agreement by an affirmative vote of a majority of the Company’s independent directors after the economic hurdle described above has been met. Any outstanding Class B Units will be forfeited immediately if the advisory agreement is terminated for any reason other than a termination without cause. Any outstanding Class B Units will be forfeited immediately if the advisory agreement is terminated without cause by an affirmative vote of a majority of the Company’s board of directors before the economic hurdle described above has been met. | |||||||||
Property Management and Leasing Fees – Property Manager | In connection with the rental, leasing, operation and management of the Company’s properties, the Company will pay the Property Manager and its affiliates aggregate fees equal to 3.0% of gross revenues from the properties managed. The Company will reimburse the Property Manager and its affiliates for property-level expenses that any of them pay or incur on the Company’s behalf, including salaries, bonuses and benefits of persons employed by the Property Manager and its affiliates except for the salaries, bonuses and benefits of persons who also serve as one of its executive officers. The Property Manager and its affiliates may subcontract the performance of their duties to third parties and pay all or a portion of the property management fee to the third parties with whom they contract for these services. If the Company contracts directly with third parties for such services, it will pay them customary market fees and will pay the Property Manager an oversight fee equal to 1.0% of the gross revenues of the property managed. In no event will the Company pay the Property Manager or any affiliate both a property management fee and an oversight fee with respect to any particular property. | ||||||||
The Company also may pay the Property Manager a separate fee for the one-time initial rent-up or leasing-up of newly constructed properties in an amount not to exceed the fee customarily charged in arm’s length transactions by others rendering similar services in the same geographic area for similar properties as determined by a survey of brokers and agents in such area and which is typically less than $1,000. | |||||||||
Construction Management Fee – Property Manager | For acting as general contractor and/or construction manager to supervise or coordinate projects or to provide major repairs or rehabilitation on our properties, the Company may pay the Property Manager up to 5.0% of the cost of the projects, repairs and/or rehabilitation, as applicable. | ||||||||
Operating Expenses – Advisor | The Company will reimburse the Advisor at the end of each fiscal quarter for operating expenses incurred on its behalf. Expenses in excess of the operating expenses in the four immediately preceding quarters that exceeds the greater of (a) 2.0% of average invested assets or (b) 25% of net income, subject to certain adjustments, will not be reimbursed unless the independent directors determine such excess expenses are justified. Additionally, the Company will not reimburse the Advisor for personnel costs in connection with services for which the Advisor receives acquisition fees or disposition fees. As of June 30, 2014, the Advisor waived, without recourse, approximately $10,000 in administrative service expenses, including payroll-related expenses. | ||||||||
Liquidation/Listing Stage | |||||||||
Disposition Fees – Advisor | The Company will pay its Advisor, or its affiliates, if it provides a substantial amount of services (as determined by a majority of the Company’s independent directors) in connection with the sale of properties, a disposition fee, up to the lesser of 1.0% of the contract sales price and one-half of the total brokerage commission paid if a third party broker is also involved, without exceeding the lesser of 6.0% of the contract sales price and a reasonable, customary and competitive real estate commission. | ||||||||
Subordinated Participation in Net Sale Proceeds (payable only if the Company is not listed on an exchange) – Advisor | The Advisor will receive 15% of the remaining net sale proceeds after return of capital contributions plus payment to investors of a 6.0% annual cumulative, non-compounded return on the capital contributed by investors. | ||||||||
Subordinated Incentive Listing Fee (payable only if the Company is listed on an exchange) – Advisor | The Advisor will receive 15% of the amount by which the sum of the Company’s adjusted market value plus distributions exceeds the sum of the aggregate capital contributed by investors plus an amount equal to a 6.0% annual cumulative, non-compounded return. | ||||||||
Subordinated Distribution Upon Termination of the Advisory Agreement – Advisor | Upon termination or non-renewal of the advisory agreement with or without cause, the Advisor will be entitled to receive distributions from the Operating Partnership equal to 15% of the amount by which the sum of the Company’s adjusted market value plus distributions exceeds the sum of the aggregate capital contributed by investors plus an amount equal to an annual 6.0% cumulative, non-compounded return to investors. In addition, the Advisor may elect to defer its right to receive a subordinated distribution upon termination until either shares of the Company’s common stock are listed and traded on a national securities exchange or another liquidity event occurs. | ||||||||
Accounts Payable Due to Affiliates | |||||||||
The following amounts were outstanding due to affiliates as of June 30, 2014 and December 31, 2013: | |||||||||
Entity | Fee | 30-Jun-14 | 31-Dec-13 | ||||||
Carter Validus Advisors II, LLC and its affiliates | Acquisition costs | $ | 4,515 | $ | — | ||||
Carter Validus Advisors II, LLC and its affiliates | General and administrative costs | 26,224 | — | ||||||
$ | 30,739 | $ | — | ||||||
Economic_Dependency
Economic Dependency | 6 Months Ended |
Jun. 30, 2014 | |
Economic Dependency [Abstract] | ' |
Economic Dependency | ' |
Note 6 — Economic Dependency | |
The Company is dependent on the Advisor and the Dealer Manager for certain services that are essential to the Company, including the sale of the Company’s shares of common and preferred stock available for issue; the identification, evaluation, negotiation, purchase and disposition of properties and other investments; the management of the daily operations of the Company’s real estate portfolio; and other general and administrative responsibilities. In the event that these companies are unable to provide the respective services, the Company will be required to obtain such services from other sources. | |
Organization_and_Offering_Cost
Organization and Offering Costs | 6 Months Ended |
Jun. 30, 2014 | |
Organization and Offering Costs [Abstract] | ' |
Organization and Offering Costs | ' |
Note 7 — Organization and Offering Expenses | |
The Company will reimburse the Advisor, or its affiliates, for organization and offering expenses incurred on the Company’s behalf, but only to the extent the reimbursement would not cause the selling commissions, dealer manager fees, distribution fees and other organization and offering expenses incurred by the Company to exceed 15% of gross offering proceeds as of the date of the reimbursement. The Company expects that other organization and offering expenses (other than selling commissions, dealer manager fees and distribution fees) will be approximately 1.25% of the gross offering proceeds. Other organization expenses will be expensed as incurred and offering expenses will be charged to stockholder’s equity as such amounts are reimbursed to the Advisor. | |
Selling commissions, dealer manager fees and distribution fees will be charged to stockholder’s equity. When accrued, offering expenses will be charged to stockholder’s equity as such amounts will be reimbursed to the Advisor, or its affiliates, from the gross proceeds of the Offering. The Advisor and its affiliates incurred organization and offering expenses on the Company’s behalf of approximately $1,929,000 as of June 30, 2014. These costs will be recognized in the condensed consolidated financial statements when the Company becomes obligated to reimburse such costs. | |
Commitments_and_Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2014 | |
Commitments and Contingencies [Abstract] | ' |
Commitments and Contingencies | ' |
Note 8 — Commitments and Contingencies | |
Litigation | |
In the ordinary course of business, the Company may become subject to litigation or claims. As of June 30, 2014, there were, and currently there are, no material pending legal proceedings to which the Company is a party. | |
Related-Party Transactions | |
See Note 5—“Related-Party Transactions and Arrangements” for disclosure of related-party transactions. | |
Subsequent_Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2014 | |
Subsequent Events [Abstract] | ' |
Subsequent Events | ' |
Note 9 — Subsequent Events | |
Subscriptions | |
Pursuant to the terms of the Offering, the Company was required to deposit all subscription proceeds in escrow until it received subscriptions aggregating at least $2,000,000 of shares of its common stock (in any combination of Class A shares or Class T shares), excluding subscriptions from residents of Pennsylvania and Washington. As of July 3, 2014, the Company had satisfied these conditions. As of August 11, 2014, the Company had accepted investors’ subscriptions for and issued approximately 336,075 shares of Class A common stock in the Offering, resulting in receipt of gross proceeds of approximately $3,223,500. In addition, the Company has special escrow requirements for subscriptions from residents of Pennsylvania and Washington, the conditions of which, to date, have not been satisfied. As of August 11, 2014, the Company had approximately $2,246,776,500 in Class A shares and Class T shares of common stock remaining in the Offering. | |
Restricted Stock Award | |
On July 11, 2014, the Company awarded 9,000 shares of Class A restricted stock under its 2014 Restricted Share Plan to independent board members in connection with their election to the board of directors and the effectiveness of the Company’s Registration Statement by the SEC. These shares vest over a period of four years with graded vesting of 25% per year over the requisite service period. The restricted stock awards were issued at fair value on the date of issuance. | |
Distributions | |
On July 16, 2014, the board of directors of the Company approved and authorized a daily distribution to the Company’s stockholders of record as of the close of business on each day of the period commencing on the closing date of its first property acquisition and ending on August 31, 2014. The distributions will be calculated based on 365 days in the calendar year and will be equal to $0.001753425 per share of Class A and Class T common stock. The distributions for each record date in July 2014 and August 2014 would be paid in August 2014 and September 2014, respectively. The distributions will be payable to stockholders from legally available funds therefor. | |
On August 1, 2014, the board of directors of the Company approved and authorized a daily distribution to the Company’s stockholders of record as of the close of business on each day of the period commencing on September 1, 2014 and ending November 30, 2014. The distributions will be calculated based on 365 days in the calendar year and will be equal to $0.001753425 per share of Class A and Class T common stock. The distributions for each record date in September 2014, October 2014 and November 2014 would be paid in October 2014, November 2014 and December 2014, respectively. As of August 6, 2014, there were no shares of Class T common stock outstanding. The distributions will be payable to stockholders from legally available funds therefor. | |
Credit Facility | |
On July 31, 2014, the Company entered into a credit agreement with KeyBank National Association, or KeyBank, to obtain a secured revolving credit facility in an aggregate maximum principal amount of $35,000,000, or the KeyBank Credit Facility. The actual amount available under the KeyBank Credit Facility is a function of certain loan-to-cost, loan-to-value, debt yield and debt service coverage ratios contained in the KeyBank Credit Facility agreement. The KeyBank Credit Facility matures on July 31, 2017 and may be extended by one 12-month period subject to the satisfaction of certain conditions, including payment of an extension fee. | |
On July 31, 2014, the Company added the Cy Fair Surgical Center (as defined below) to the collateral pool of the KeyBank Credit Facility, which increased the borrowing base availability under the KeyBank Credit Facility by approximately $2,893,000. As of August 11, 2014, the Company had drawn $2,143,000 under the KeyBank Credit Facility and had approximately $750,000 remaining available thereunder. | |
Acquisition of the Cy Fair Surgical Center | |
On July 31, 2014, the Company completed the acquisition of a 100% fee simple interest in a 13,645 square foot surgical center, or the Cy Fair Surgical Center, located in Houston, Texas, for a purchase price of $4,450,000, plus closing costs. The Company financed the purchase of the Cy Fair Surgical Center using net proceeds from the Offering and the KeyBank Credit Facility. The Cy Fair Surgical Center is leased to a single tenant. With respect to this acquisition, the Company has not completed its initial fair value-based purchase allocation; it is therefore impractical to provide pro-forma information. | |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policy) | 6 Months Ended | ||
Jun. 30, 2014 | |||
Summary of Significant Accounting Policies [Abstract] | ' | ||
Principles of Consolidation and Basis of Presentation | ' | ||
Principles of Consolidation and Basis of Presentation | |||
For the period from January 11, 2013 through December 31, 2013, the Company had not begun principal operations. The accompanying condensed consolidated unaudited financial statements include the accounts of the Company and the Operating Partnership. All intercompany accounts and transactions have been eliminated. | |||
Use of Estimates | ' | ||
Use of Estimates | |||
The preparation of the financial statements and accompanying notes in conformity with GAAP requires the Company to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. These estimates are made and evaluated on an on-going basis using information that is currently available as well as various other assumptions believed to be reasonable under the circumstances. Actual results could differ from those estimates. | |||
Cash and Cash Equivalents | ' | ||
Cash and Cash Equivalents | |||
The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Cash equivalents may include cash and short-term investments. Short-term investments are stated at cost, which approximates fair value. | |||
Real Estate Investments | ' | ||
Real Estate Investments | |||
Depreciation | |||
Real estate costs related to the acquisition, development, construction and improvement of properties will be capitalized. Repair and maintenance costs will be charged to expense as incurred and significant replacements and betterments will be capitalized. Repair and maintenance costs will include all costs that do not extend the useful life of the real estate asset. The Company will consider the period of future benefit of an asset in determining the appropriate useful life. The Company anticipates the estimated useful lives of its assets by class will be generally as follows: | |||
Buildings and improvements | 15 – 40 years | ||
Tenant improvements | Shorter of lease term or expected useful life | ||
Tenant origination and absorption costs | Remaining term of related lease | ||
Furniture, fixtures, and equipment | 3 – 10 years | ||
Allocation of Purchase Price of Real Estate and Related Assets | ' | ||
Allocation of Purchase Price of Real Estate and Related Assets | |||
Upon the acquisition of real properties determined to be business combinations, the Company will allocate the purchase price of properties to acquired tangible assets, consisting of land, buildings and improvements, and identified intangible assets and liabilities, consisting of the value of above-market and below-market leases and the value of in-place leases, based in each case on their estimated fair values. | |||
The fair values of the tangible assets of an acquired property (which includes land, buildings and improvements) will be determined by valuing the property as if it were vacant, and the “as-if-vacant” value will be allocated to land and building based on management’s determination of the relative fair value of these assets. Management will determine the as-if-vacant fair value of a property using methods similar to those used by independent appraisers. Factors considered by management in performing these analyses will include an estimate of carrying costs during the expected lease-up periods considering current market conditions and costs to execute similar leases, including leasing commissions and other related costs. In estimating carrying costs, management will include real estate taxes, insurance, and other operating expenses during the expected lease-up periods based on current market conditions. | |||
The fair values of above-market and below-market in-place lease values will be recorded based on the present value (using an interest rate which reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to the in-place leases and (ii) an estimate of fair market lease rates for the corresponding in-place leases, measured over a period equal to the remaining non-cancelable term of the lease including any bargain renewal periods, with respect to a below-market lease. The above-market and below-market lease values will be capitalized as intangible lease assets or liabilities. Above-market lease values will be amortized as an adjustment of rental income over the remaining terms of the respective leases. Below-market leases will be amortized as an adjustment of rental income over the remaining terms of the respective leases, including any bargain renewal periods. If a lease were to be terminated prior to its stated expiration, all unamortized amounts of above-market and below-market in-place lease values relating to that lease would be recorded as an adjustment to rental income. | |||
The fair values of in-place leases will include direct costs associated with obtaining a new tenant, opportunity costs associated with lost rentals that are avoided by acquiring an in-place lease, and tenant relationships. Direct costs associated with obtaining a new tenant include commissions, tenant improvements, and other direct costs and will be estimated based on management’s consideration of current market costs to execute a similar lease. These direct lease origination costs will be included in real estate assets in the accompanying consolidated balance sheets and will be amortized to expense over the remaining terms of the respective leases. The value of opportunity costs will be calculated using the contractual amounts to be paid pursuant to the in-place leases over a market absorption period for a similar lease. These lease intangibles will be included in real estate assets in the accompanying condensed consolidated balance sheets and amortized to expense over the remaining terms of the respective leases. If a lease were to be terminated prior to its stated expiration, all unamortized amounts of in-place lease assets relating to that lease would be expensed. | |||
Impairment of Long Lived Assets | ' | ||
Impairment of Long Lived Assets | |||
The Company will continually monitor events and changes in circumstances that could indicate that the carrying amounts of its real estate and related intangible assets may not be recoverable. When indicators of potential impairment suggest that the carrying value of real estate and related intangible assets may not be recoverable, the Company will assess the recoverability of the assets by estimating whether the Company will recover the carrying value of the asset through its undiscounted future cash flows and its eventual disposition. If based on this analysis the Company does not believe that it will be able to recover the carrying value of the asset, the Company will record an impairment loss to the extent that the carrying value exceeds the estimated fair value of the asset. | |||
Real Estate-Related Notes Receivables | ' | ||
Real Estate-Related Notes Receivables | |||
The Company may invest in real estate-related notes receivables that represent loans that the Company intends to hold to maturity. They will be classified as real estate-related notes receivables. Accordingly, these notes will be recorded at cost, net of unamortized loan origination costs and fees, loan purchase discounts, and allowance for losses when a loan is determined to be impaired. Premiums, discounts, and net origination fees will be amortized or accreted as an adjustment to interest income using the effective interest method over the life of the loan. | |||
The Company will evaluate the collectability of both interest and principal on each real estate-related note receivable to determine whether it is collectible, primarily through the evaluation of credit quality indicators such as underlying collateral and payment history. A real estate-related note receivable will be considered to be impaired when, based upon current information and events, it is probable that the Company will be unable to collect all amounts due according to the existing contractual terms. If a real estate-related note receivable is considered to be impaired, the amount of loss will be calculated by comparing the recorded investment to the value determined by discounting the expected future cash flows at the real estate-related note receivable’s effective interest rate or to the value of the underlying collateral if the real estate-related note receivable is collateral dependent. | |||
Rents and Other Receivables | ' | ||
Rents and Other Receivables | |||
The Company will evaluate the collectability of amounts due from tenants at each balance sheet date and maintain an allowance for doubtful accounts for estimated losses resulting from the inability of tenants to make required payments under lease agreements. The Company will exercise judgment in establishing these allowances and consider payment history and current credit status of its tenants in developing these estimates. | |||
Noncontrolling Interest in Operating Partnership | ' | ||
Noncontrolling Interest in Operating Partnership | |||
The Company is the sole general partner of the Operating Partnership and the Advisor is the initial limited partner of the Operating Partnership. The Company owns a 99.01% interest in the Operating Partnership and the Advisor owns a .99% interest in the Operating Partnership. The Company consolidates the Operating Partnership and reports unaffiliated partners’ interests in the Operating Partnership as noncontrolling interests. Noncontrolling interests are reported within the equity section of the consolidated financial statements, and amounts attributable to controlling and noncontrolling interests are reported separately in the accompanying condensed consolidated statement of operations and accompanying condensed consolidated statement of stockholder’s equity. | |||
Revenue Recognition | ' | ||
Revenue Recognition | |||
The Company will recognize revenue when all four of the following basic criteria are met before revenue is realized or realizable and earned: (1) there is persuasive evidence that an arrangement exists; (2) delivery has occurred or services have been rendered; (3) the seller’s price to the buyer is fixed and determinable; and (4) collectability is reasonably assured. | |||
Rental Revenue | |||
In accordance with ASC Topic 840, Leases, minimum rental revenue will be recognized on a straight-line basis over the term of the related lease (including rent holidays). Differences between rental income recognized and amounts contractually due under the lease agreements will be credited or charged to deferred rent receivable or deferred rent liability, as applicable. Tenant reimbursement revenue, which will be comprised of additional amounts recoverable from tenants for common area maintenance expenses and certain other recoverable expenses, will be recognized as revenue in the period in which the related expenses are incurred. | |||
Interest Income | |||
Interest income on performing real estate-related notes receivables will be accrued as earned. Interest income on an impaired real estate-related note receivable will be recognized on a cash basis. Fees related to the buy down of the interest rate will be deferred as prepaid interest income and amortized over the term of the loan as an adjustment to interest income using the effective interest method. Closing costs related to the purchase of the real estate-related note receivable will be amortized over the term of the loan and accreted as an adjustment against interest income using the effective interest method. | |||
Accounting for Stock-Based Compensation | ' | ||
Accounting for Stock-Based Compensation | |||
The Company will account for stock-based compensation based upon the estimated fair value of the share awards. Accounting for stock-based compensation requires the fair value of the awards to be amortized as compensation expense over the period for which the services relate and requires any dividend equivalents earned to be treated as dividends for financial reporting purposes. | |||
Earnings Per Share | ' | ||
Earnings Per Share | |||
The Company calculates basic earnings per share by dividing net income (loss) for the period by the weighted-average shares of its common stock outstanding for that period. As of June 30, 2014, the Company had 20,000 weighted-average shares of Class A common stock outstanding. | |||
Deferred Financing Cost | ' | ||
Deferred Financing Cost | |||
Deferred financing costs are loan fees, legal fees and other third-party costs associated with obtaining financing. These costs are amortized over the terms of the respective financing agreements using the effective interest method. Unamortized deferred financing costs are generally expensed when the associated debt is refinanced or repaid before maturity unless specific rules are met that would allow for the carryover of such costs to the refinanced debt. Costs incurred in seeking financing transactions that do not close are expensed in the period in which it is determined that the financing will not close. As of June 30, 2014, the Company’s deferred financing costs were $23,019 and related to the Company’s credit facility agreement, which was entered into on July 31, 2014. See Note 9—“Subsequent Events—Credit Facility” for a discussion on the Company’s credit facility agreement. Deferred financing costs are reported in other assets in the accompanying condensed consolidated balance sheets. | |||
Derivative Instruments and Hedging Activities | ' | ||
Derivative Instruments and Hedging Activities | |||
The Company may enter into derivative contracts to add stability to future cash flows by managing its exposure to interest rate movements. The Company may utilize derivative instruments, including interest rate swaps, to effectively convert a portion of its variable rate debt to fixed rate debt. The Company will not enter into derivative instruments for speculative purposes. | |||
The Company will account for its derivative instruments in accordance with ASC Topic 815, Derivatives and Hedging, or ASC 815, which requires companies to recognize all of its derivative instruments as either assets or liabilities in the statement of financial position at fair value. The accounting for changes in the fair value of a derivative instrument depends on whether it has been designated and qualifies as part of a hedging relationship and further, on the type of hedging relationship. For those derivative instruments that are designated and qualify as hedging instruments, a company must designate the hedging instrument, based upon the exposure being hedged, as a fair value hedge, cash flow hedge or a hedge of a net investment in a foreign operation. For derivative instruments not designated as hedging instruments, the gain or loss is recognized in the statement of operations during the current period. | |||
In accordance with ASC 815, the Company will designate interest rate swap contracts as cash flow hedges of floating-rate borrowings. For derivative instruments that are designated and qualify as cash flow hedges, the effective portion of the gain or loss on the derivative instrument will be reported as a component of other comprehensive income and reclassified into earnings in the same line item associated with the forecasted transaction and in the same period during which the hedged transaction affects earnings. The ineffective portion of the gain or loss on the derivative instruments will be recognized in the statement of operations during the current period. | |||
Distribution Policy | ' | ||
Distribution Policy | |||
The Company intends to elect to be taxed as a REIT and to operate as a REIT beginning with its taxable year ending December 31, 2014, or the first year in which the Company commences material operations, if later. To qualify and maintain its qualification as a REIT, the Company intends to make distributions each taxable year equal to at least 90% of its REIT taxable income (which is determined without regard to the dividends paid deduction or net capital gain and which does not necessarily equal net income as calculated in accordance with GAAP). The Company expects to authorize and declare daily distributions that will be paid on a monthly basis. See Note 9—“Subsequent Events—Distributions” for distributions approved by the board of directors on July 16, 2014. | |||
Distributions to stockholders will be determined by the board of directors of the Company and will be dependent upon a number of factors relating to the Company, including funds available for the payment of distributions, financial condition, the timing of property acquisitions, capital expenditure requirements, and annual distribution requirements in order to maintain the Company’s status as a REIT under the Code. | |||
Concentration of Credit Risk | ' | ||
Concentration of Credit Risk | |||
At June 30, 2014 and December 31, 2013, the Company had no cash on deposit in excess of federally insured levels. The Company limits investment of cash investments to financial institutions with high credit standing; therefore, the Company believes it is not exposed to any significant credit risk on cash. There were no restrictions on the use of the Company’s cash as of June 30, 2014 and December 31, 2013. | |||
Income Taxes | ' | ||
Income Taxes | |||
The Company intends to elect and qualify to be taxed as a REIT, commencing with its taxable year ending December 31, 2014, or the first year in which the Company commences material operations, if later. Accordingly, it will generally not be subject to corporate U.S. federal or state income tax to the extent that it makes qualifying distributions to stockholders, and provided it satisfies, on a continuing basis, through actual investment and operating results, the REIT requirements, including certain asset, income, distribution and stock ownership tests. If the Company fails to qualify as a REIT, and does not qualify for certain statutory relief provisions, it will be subject to U.S. federal, state and local income taxes and may be precluded from qualifying as a REIT for the subsequent four taxable years following the year in which it lost its REIT qualification, unless the Internal Revenue Service grants the Company relief under certain statutory provisions. Accordingly, failure to qualify as a REIT could have a material adverse impact on the results of operations and amounts available for distributions to stockholders. | |||
The dividends paid deduction of a REIT for qualifying dividends paid to its stockholders is computed using the Company’s taxable income as opposed to net income reported in the financial statements. Taxable income, generally, will differ from net income reported in the financial statements because the determination of taxable income is based on tax provisions and not financial accounting principles. | |||
The Company has concluded that there was no impact related to uncertain tax provisions from results of operations of the Company for the three and six months ended June 30, 2014. The United States of America is the major jurisdiction for the Company, and the earliest tax year subject to examination will be 2014. | |||
Recently Issued Accounting Pronouncements | ' | ||
Recently Issued Accounting Pronouncements | |||
In April 2014, the Financial Accounting Standards Board, or the FASB, issued ASU 2014-08, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity, or ASU 2014-08. ASU 2014-08 changes the criteria for reporting discontinued operations while enhancing disclosures in this area. Under the new guidance, only disposals representing a strategic shift in operations should be presented as discontinued operations. Those strategic shifts should have a major effect on the company’s operations and financial results. Examples include a disposal of a major geographic area, a major line of business, or a major equity method investment. Additionally, the new guidance requires expanded disclosures about discontinued operations that will provide financial statement users with more information about the assets, liabilities, income, and expenses of discontinued operations. The adoption of ASU 2014-08 is effective prospectively for reporting periods beginning on or after December 15, 2014. The Company does not expect the adoption of ASU 2014-08 to have a material effect on the Company’s condensed consolidated financial statements. | |||
In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers, or ASU 2014-09. The objective of ASU 2014-09 is to clarify the principles for recognizing revenue and to develop a common revenue standard for GAAP. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods and services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The adoption of ASU 2014-09 is effective retrospectively for reporting periods beginning after December 15, 2017. Early adoption of ASU 2014-09 is not permitted. The Company is in the process of evaluating the impact ASU 2014-09 will have on the Company’s condensed consolidated financial statements. | |||
In June 2014, the FASB issued ASU 2014-12, Accounting for Share-Based Payments When the Terms of and Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period, or ASU 2014-12. The objective of ASU 2014-12 is to clarify the proper method of accounting for share-based payments when the terms of an award provide that a performance target could be achieved after the requisite service period. Under ASU 2014-12, a performance target that affects vesting and could be achieved after completion of the service period should be treated as a performance condition under FASB Accounting Standards Codification Topic 718, Compensation—Stock Compensation, and, as a result, should not be included in the estimation of the grant-date fair value of the award. An entity should recognize compensation cost for the award when it becomes probable that the performance target will be achieved. The adoption of ASU 2014-12 is effective for annual periods and interim periods beginning after December 15, 2015. Early adoption is permitted. The Company does not expect the adoption of ASU 2014-12 to have a material effect on the Company’s condensed consolidated financial statements. | |||
Summary_of_Significant_Account2
Summary of Significant Accounting Policies (Tables) | 6 Months Ended | ||
Jun. 30, 2014 | |||
Summary of Significant Accounting Policies [Abstract] | ' | ||
Schedule of Estimated Useful Lives of Assets by Class | ' | ||
Buildings and improvements | 15 – 40 years | ||
Tenant improvements | Shorter of lease term or expected useful life | ||
Tenant origination and absorption costs | Remaining term of related lease | ||
Furniture, fixtures, and equipment | 3 – 10 years | ||
Other_Assets_Tables
Other Assets (Tables) | 6 Months Ended | |||||
Jun. 30, 2014 | ||||||
Other Assets [Abstract] | ' | |||||
Schedule of Other Assets | ' | |||||
30-Jun-14 | 31-Dec-13 | |||||
Real estate escrow deposits | $ | 100,000 | $ | — | ||
Deferred financing costs | 23,019 | — | ||||
Prepaid assets | 17,214 | — | ||||
$ | 140,233 | $ | — | |||
RelatedParty_Transactions_and_1
Related-Party Transactions and Arrangements (Tables) | 6 Months Ended | ||||||||
Jun. 30, 2014 | |||||||||
Related-Party Transactions and Arrangements [Abstract] | ' | ||||||||
Schedule of Accounts Payable Due to Affiliates | ' | ||||||||
Entity | Fee | 30-Jun-14 | 31-Dec-13 | ||||||
Carter Validus Advisors II, LLC and its affiliates | Acquisition costs | $ | 4,515 | $ | — | ||||
Carter Validus Advisors II, LLC and its affiliates | General and administrative costs | 26,224 | — | ||||||
$ | 30,739 | $ | — | ||||||
Organization_and_Business_Oper1
Organization and Business Operations (Details) (USD $) | 6 Months Ended | 1 Months Ended | 3 Months Ended | 0 Months Ended | ||||||
Jun. 30, 2014 | Jun. 30, 2014 | 29-May-14 | 29-May-14 | 29-May-14 | Aug. 11, 2014 | Jul. 03, 2014 | Jul. 03, 2014 | Aug. 11, 2014 | Jan. 31, 2013 | |
Offering [Member] | Offering [Member] | Class A shares [Member] | Class T shares [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Carter Validus REIT Management Company II, LLC [Member] | ||
item | Offering [Member] | Offering [Member] | Offering [Member] | Offering [Member] | Class A shares [Member] | Class A shares [Member] | Class A shares [Member] | |||
Offering [Member] | Offering [Member] | Private Placement [Member] | ||||||||
Common Stock [Member] | ||||||||||
Organization and Business Operations [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Company owned interest in Operating Partnership | 99.01% | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Advisor owned interest in Operating Partnership | 0.99% | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Issuance of common stock, shares | ' | ' | ' | ' | ' | ' | ' | 213,333 | ' | 20,000 |
Common stock offering, price per share | ' | ' | ' | $10 | $9.57 | ' | ' | ' | ' | $10 |
Issuance of common stock | ' | ' | ' | ' | ' | ' | ' | $2,000,000 | $3,223,500 | $200,000 |
Number of general partnership units held by the Company | 20,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock offering, value | ' | ' | 2,250,000,000 | ' | ' | ' | ' | ' | ' | ' |
Common stock offering pursuant to distribution reinvestment plan, value | ' | ' | 100,000,000 | ' | ' | ' | ' | ' | ' | ' |
Number of classes of common stock | ' | ' | 2 | ' | ' | ' | ' | ' | ' | ' |
Subscriptions required to break escrow, minimum | ' | 2,000,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock remaining in the offering, value | ' | ' | ' | ' | ' | $2,246,776,500 | $2,248,000,000 | ' | ' | ' |
Summary_of_Significant_Account3
Summary of Significant Accounting Policies (Narrative) (Details) (USD $) | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2014 | Jun. 30, 2014 | Dec. 31, 2013 | |
Summary of Significant Accounting Policies [Line Items] | ' | ' | ' |
Company owned interest in Operating Partnership | ' | 99.01% | ' |
Advisor owned interest in Operating Partnership | ' | 0.99% | ' |
Deferred financing costs | $23,019 | $23,019 | ' |
Cash on deposit in excess of federally insured levels | 0 | 0 | 0 |
Restricted cash | 0 | 0 | 0 |
Impact related to uncertain tax provisions from the results of operations | $0 | $0 | ' |
Class A shares [Member] | ' | ' | ' |
Summary of Significant Accounting Policies [Line Items] | ' | ' | ' |
Weighted average shares of common stock outstanding | 20,000 | 20,000 | ' |
Summary_of_Significant_Account4
Summary of Significant Accounting Policies (Schedule of Estimated Useful Lives of Assets by Class) (Details) | 6 Months Ended |
Jun. 30, 2014 | |
Buildings and improvements [Member] | Maximum [Member] | ' |
Estimated Useful Lives of Assets by Class [Line Items] | ' |
Estimated useful life | '40 years |
Buildings and improvements [Member] | Minimum [Member] | ' |
Estimated Useful Lives of Assets by Class [Line Items] | ' |
Estimated useful life | '15 years |
Furniture, fixtures, and equipment [Member] | Maximum [Member] | ' |
Estimated Useful Lives of Assets by Class [Line Items] | ' |
Estimated useful life | '10 years |
Furniture, fixtures, and equipment [Member] | Minimum [Member] | ' |
Estimated Useful Lives of Assets by Class [Line Items] | ' |
Estimated useful life | '3 years |
Other_Assets_Schedule_of_Other
Other Assets (Schedule of Other Assets) (Details) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Other Assets [Abstract] | ' | ' |
Real estate escrow deposits | $100,000 | ' |
Deferred financing costs | 23,019 | ' |
Prepaid assets | 17,214 | ' |
Total other assets | $140,233 | ' |
Stockholders_Equity_Details
Stockholder's Equity (Details) (USD $) | 6 Months Ended | 0 Months Ended | ||||||
Jun. 30, 2014 | Dec. 31, 2013 | 29-May-14 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | 29-May-14 | |
Offering [Member] | Class A shares [Member] | Class A shares [Member] | Class T shares [Member] | Class T shares [Member] | Maximum [Member] | |||
item | ||||||||
Stockholder's Equity [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Shares authorized by Company charter | 600,000,000 | ' | ' | ' | ' | ' | ' | ' |
Common stock, shares authorized | 500,000,000 | ' | ' | 250,000,000 | 300,000,000 | 250,000,000 | 0 | ' |
Common stock, par value | $0.01 | ' | ' | $0.01 | $0.01 | $0.01 | $0.01 | ' |
Preferred stock, shares authorized | 100,000,000 | 50,000,000 | ' | ' | ' | ' | ' | ' |
Preferred stock, par value | $0.01 | $0.01 | ' | ' | ' | ' | ' | ' |
Common stock offering, value | ' | ' | $2,250,000,000 | ' | ' | ' | ' | ' |
Common stock offering pursuant to distribution reinvestment plan, value | ' | ' | $100,000,000 | ' | ' | ' | ' | ' |
Reinvestment in additional shares, at percentage of purchase price per share | 95.00% | ' | ' | ' | ' | ' | ' | ' |
Number of classes of common stock | ' | ' | 2 | ' | ' | ' | ' | ' |
Preferred stock, shares issued | 0 | 0 | ' | ' | ' | ' | ' | ' |
Preferred stock, shares outstanding | 0 | 0 | ' | ' | ' | ' | ' | ' |
Period from offering effective date DRIP will terminate | ' | ' | ' | ' | ' | ' | ' | '2 years |
Period of notice required for changes to DRIP | '10 days | ' | ' | ' | ' | ' | ' | ' |
RelatedParty_Transactions_and_2
Related-Party Transactions and Arrangements (Narrative) (Details) (USD $) | 6 Months Ended |
Jun. 30, 2014 | |
Related Party Transaction [Line Items] | ' |
Cumulative non-compounded annual return rate to investors | 6.00% |
SC Distributors, LLC [Member] | ' |
Related Party Transaction [Line Items] | ' |
Underwriting compensation percentage that will terminate distribution fees, as percentage of gross proceeds from primary portion of offering | 10.00% |
Carter Validus Advisors II, LLC [Member] | ' |
Related Party Transaction [Line Items] | ' |
Acquisition fee, as percentage of contract purchase price of each property or asset acquired | 2.00% |
Acquisition fee, as percentage of amount advanced on mortgage loan | 2.00% |
Estimated acquisition expense reimbursement, as percentage of purchase price of property and real estate-related investments | 0.75% |
Monthly asset management fee, as percentage of gross assets | 0.06% |
Period needed to issue Class B Units | '30 days |
Factor used to calculate Class B Units as monthly asset management fee | 0.06% |
Operating expense reimbursement, waived, without recourse | 10,000 |
Percentage of remaining net sales proceeds Advisor will receive after investors receive return | 15.00% |
Listing fee percentage | 15.00% |
Distribution percentage upon termination of Advisory agreement | 15.00% |
Carter Validus Advisors II, LLC [Member] | Maximum [Member] | ' |
Related Party Transaction [Line Items] | ' |
Acquisition fee and expense reimbursement, as percentage of purchase price of properties | 6.00% |
Acquisition fee and expense reimbursement, as percentage of amount advanced on mortgage loans | 6.00% |
Operating expense reimbursement, percentage of average invested assets | 2.00% |
Operating expense reimbursement, as percentage of net income | 25.00% |
Carter Validus Advisors II, LLC And/Or Its Affiliates [Member] | ' |
Related Party Transaction [Line Items] | ' |
Estimated organization and offering costs (net of selling commission, dealer manager fees and distribution fees), as percentage of gross offering proceeds | 1.25% |
Carter Validus Advisors II, LLC And/Or Its Affiliates [Member] | Maximum [Member] | ' |
Related Party Transaction [Line Items] | ' |
Reimbursable organization and offering costs cap, as percentage of gross offering proceeds | 15.00% |
Disposition fee, as percentage of contract sales price | 1.00% |
Percentage of brokerage fees paid by Company in event advisor provides substantial amount of services | 50.00% |
Maximum brokerage fees paid by Company, as percentage of contract sales price | 6.00% |
Carter Validus Real Estate Management Services II, LLC [Member] | ' |
Related Party Transaction [Line Items] | ' |
Property management and leasing fees, as percentage of gross revenues from properties managed | 3.00% |
Oversight fee, as percentage of gross revenues from properties managed | 1.00% |
Carter Validus Real Estate Management Services II, LLC [Member] | Maximum [Member] | ' |
Related Party Transaction [Line Items] | ' |
Estimated initial rent-up or lease-up fee for newly constructed properties | 1,000 |
Construction management fee, as percentage of cost of project | 5.00% |
Class A and T shares [Member] | SC Distributors, LLC [Member] | Maximum [Member] | ' |
Related Party Transaction [Line Items] | ' |
Dealer manager fee, as percentage of gross offering proceeds | 3.00% |
Class A shares [Member] | SC Distributors, LLC [Member] | Maximum [Member] | ' |
Related Party Transaction [Line Items] | ' |
Selling commission, as percentage of gross offering proceeds | 7.00% |
Class T shares [Member] | SC Distributors, LLC [Member] | ' |
Related Party Transaction [Line Items] | ' |
Daily distribution fee accrued, as percentage of purchase price per share | 0.00% |
Class T shares [Member] | SC Distributors, LLC [Member] | Maximum [Member] | ' |
Related Party Transaction [Line Items] | ' |
Selling commission, as percentage of gross offering proceeds | 3.00% |
RelatedParty_Transactions_and_3
Related-Party Transactions and Arrangements (Schedule of Accounts Payable Due to Affiliates) (Details) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Related Party Transaction [Line Items] | ' | ' |
Accounts payable due to affiliates | $30,739 | ' |
Carter Validus Advisors II, LLC And/Or Its Affiliates [Member] | Acquisition Costs [Member] | ' | ' |
Related Party Transaction [Line Items] | ' | ' |
Accounts payable due to affiliates | 4,515 | ' |
Carter Validus Advisors II, LLC And/Or Its Affiliates [Member] | General And Administrative Costs [Member] | ' | ' |
Related Party Transaction [Line Items] | ' | ' |
Accounts payable due to affiliates | $26,224 | ' |
Organization_and_Offering_Cost1
Organization and Offering Costs (Details) (Carter Validus Advisors II, LLC And/Or Its Affiliates [Member], USD $) | 6 Months Ended |
Jun. 30, 2014 | |
Organization and Offering Costs [Line Items] | ' |
Estimated organization and offering costs (net of selling commission, dealer manager fees and distribution fees), as percentage of gross offering proceeds | 1.25% |
Organization and offering costs incurred by Advisor | $1,929,000 |
Maximum [Member] | ' |
Organization and Offering Costs [Line Items] | ' |
Reimbursable organization and offering costs cap, as percentage of gross offering proceeds | 15.00% |
Commitments_and_Contingencies_
Commitments and Contingencies (Details) | Jun. 30, 2014 |
claim | |
Commitments and Contingencies [Abstract] | ' |
Number of pending legal proceedings to which the Company is a party | 0 |
Subsequent_Events_Details
Subsequent Events (Details) (USD $) | 0 Months Ended | 0 Months Ended | 6 Months Ended | 0 Months Ended | 6 Months Ended | 0 Months Ended | 1 Months Ended | 3 Months Ended | 0 Months Ended | |||||||||||||
Jul. 31, 2014 | Jul. 31, 2014 | Aug. 11, 2014 | Jul. 31, 2014 | Jul. 31, 2014 | Jun. 30, 2014 | Jul. 31, 2014 | Jul. 16, 2014 | Aug. 01, 2014 | Jun. 30, 2014 | Aug. 11, 2014 | Jul. 03, 2014 | Jun. 30, 2014 | Dec. 31, 2013 | Jul. 11, 2014 | Jul. 03, 2014 | Aug. 11, 2014 | Jun. 30, 2014 | Dec. 31, 2013 | Aug. 06, 2014 | Jul. 16, 2014 | Aug. 01, 2014 | |
Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Offering [Member] | Offering [Member] | Offering [Member] | Class A shares [Member] | Class A shares [Member] | Class A shares [Member] | Class A shares [Member] | Class A shares [Member] | Class T shares [Member] | Class T shares [Member] | Class T shares [Member] | Class A and T shares [Member] | Class A and T shares [Member] | |
Cy Fair Surgical Center [Member] | Cy Fair Surgical Center [Member] | KeyBank Credit Facility [Member] | KeyBank Credit Facility [Member] | KeyBank Credit Facility [Member] | KeyBank Credit Facility [Member] | KeyBank Credit Facility [Member] | July 31, 2014 To August 31, 2014 [Member] | September 1, 2014 To November 30, 2014 [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Offering [Member] | Offering [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | ||||||
sqft | Cy Fair Surgical Center [Member] | Revolving Line Of Credit [Member] | Revolving Line Of Credit [Member] | Revolving Line Of Credit [Member] | 2014 Restricted Share Plan [Member] | Subsequent Event [Member] | Subsequent Event [Member] | July 31, 2014 To August 31, 2014 [Member] | September 1, 2014 To November 30, 2014 [Member] | |||||||||||||
item | Restricted Stock [Member] | |||||||||||||||||||||
Subsequent Event [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Subscriptions required to break escrow, minimum | ' | ' | ' | ' | ' | ' | ' | ' | ' | $2,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Issuance of common stock, shares | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 213,333 | ' | ' | ' | ' | ' | ' |
Issuance of common stock | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,000,000 | 3,223,500 | ' | ' | ' | ' | ' |
Common stock remaining in the offering, value | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,246,776,500 | 2,248,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of shares awarded to independent board members upon election | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9,000 | ' | ' | ' | ' | ' | ' | ' |
Award vesting period under plan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '4 years | ' | ' | ' | ' | ' | ' | ' |
Award graded vesting percentage, per year | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25.00% | ' | ' | ' | ' | ' | ' | ' |
Number of days, distribution calculation | ' | ' | ' | ' | ' | ' | ' | '365 days | '365 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Distributions declared per common share | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0.00 | $0.00 |
Aggregate maximum principal amount | ' | ' | ' | ' | ' | ' | 35,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock, shares outstanding | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 20,000 | 20,000 | ' | ' | ' | 0 | 0 | 0 | ' | ' |
Credit facility, maturity date | ' | ' | ' | ' | ' | 31-Jul-17 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Credit facility, number of maturity extension date periods | ' | ' | ' | ' | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Credit facility, available extension period | ' | ' | ' | ' | '12 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Borrowing base availability | ' | ' | ' | 2,893,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Principal amount outstanding | ' | ' | 2,143,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Borrowing base remaining | ' | ' | 750,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of fee simple interest acquired | 100.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Area of real estate property acquired | ' | 13,645 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Purchase price | $4,450,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |