Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Mar. 14, 2019 | Jun. 29, 2018 | |
Entity Information [Line Items] | |||
Entity Registrant Name | Cole Office & Industrial REIT (CCIT III), Inc. | ||
Entity Central Index Key | 0001614976 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2018 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2018 | ||
Document Fiscal Period Focus | FY | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 23.5 | ||
Entity Shell Company | false | ||
Entity Emerging Growth Company | true | ||
Entity Small Business | false | ||
Entity Ex Transition Period | true | ||
Class A Common Stock | |||
Entity Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 2,500,000 | ||
Class T Common Stock | |||
Entity Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 756,000 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Real estate assets: | ||
Land | $ 3,245,003 | $ 3,245,003 |
Buildings and improvements | 41,258,770 | 41,258,770 |
Intangible lease assets | 5,101,432 | 5,101,432 |
Total real estate assets, at cost | 49,605,205 | 49,605,205 |
Less: accumulated depreciation and amortization | (3,823,287) | (1,911,033) |
Total real estate assets, net | 45,781,918 | 47,694,172 |
Cash and cash equivalents | 635,959 | 351,461 |
Rents and tenant receivables, net | 943,287 | 1,018,825 |
Prepaid expenses and other assets | 79,198 | 116,796 |
Deferred costs, net | 407,029 | 950,978 |
Total assets | 47,847,391 | 50,132,232 |
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||
Credit facility | 24,175,000 | 31,975,000 |
Subordinate promissory note | 0 | 1,600,000 |
Accrued expenses and accounts payable | 683,380 | 853,388 |
Due to affiliates | 188,461 | 278,394 |
Distributions payable | 155,111 | 100,241 |
Deferred rental income | 0 | 208,716 |
Total liabilities | 25,201,952 | 35,015,739 |
Commitments and contingencies | ||
Redeemable common stock | 182,158 | 87,337 |
STOCKHOLDERS’ EQUITY | ||
Preferred stock, $0.01 par value; 10,000,000 shares authorized, none issued and outstanding | 0 | 0 |
Capital in excess of par value | 28,016,307 | 18,284,253 |
Accumulated distributions in excess of earnings | (5,584,678) | (3,275,779) |
Total stockholders’ equity | 22,463,281 | 15,029,156 |
Total liabilities, redeemable common stock, and stockholders’ equity | 47,847,391 | 50,132,232 |
Class A Common Stock | ||
STOCKHOLDERS’ EQUITY | ||
Common stock | 24,179 | 14,369 |
Class T Common Stock | ||
STOCKHOLDERS’ EQUITY | ||
Common stock | $ 7,473 | $ 6,313 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2018 | Dec. 31, 2017 |
Preferred stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in usd per share) | $ 0.01 | |
Common stock, shares authorized (in shares) | 490,000,000 | 490,000,000 |
Class A Common Stock | ||
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 245,000,000 | 245,000,000 |
Common stock, shares issued (in shares) | 2,424,682 | 1,436,855 |
Common stock, shares outstanding (in shares) | 2,424,682 | 1,436,855 |
Class T Common Stock | ||
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 245,000,000 | 245,000,000 |
Common stock, shares issued (in shares) | 747,316 | 631,346 |
Common stock, shares outstanding (in shares) | 747,316 | 631,346 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Revenues: | |||
Total revenues | $ 4,406,375 | $ 4,104,597 | $ 798,433 |
Operating expenses: | |||
General and administrative | 936,397 | 815,586 | 372,030 |
Property operating | 13,130 | 12,058 | 2,962 |
Real estate tax | 506,499 | 1,215,423 | 61,202 |
Advisory fees and expenses | 0 | 60,565 | 74,289 |
Transaction-related | 0 | 41,576 | 764,622 |
Depreciation and amortization | 1,912,254 | 1,493,033 | 418,000 |
Total operating expenses | 3,368,280 | 3,638,241 | 1,693,105 |
Operating income (loss) | 1,038,095 | 466,356 | (894,672) |
Interest expense and other, net | (1,809,807) | (1,588,351) | (497,607) |
Net loss | (771,712) | (1,121,995) | (1,392,279) |
Common Class A | |||
Operating expenses: | |||
Net loss | $ (523,089) | $ (894,373) | $ (1,389,630) |
Basic and diluted weighted average number of common shares outstanding (in shares) | 1,977,654 | 993,758 | 97,638 |
Basic and diluted net loss per common share (in dollars per share) | $ (0.26) | $ (0.90) | $ (14.23) |
Class T Common Stock | |||
Operating expenses: | |||
Net loss | $ (248,623) | $ (227,622) | $ (2,649) |
Basic and diluted weighted average number of common shares outstanding (in shares) | 699,395 | 228,908 | 186 |
Basic and diluted net loss per common share (in dollars per share) | $ (0.36) | $ (0.99) | $ (14.27) |
Rental Revenue | |||
Revenues: | |||
Rental income | $ 3,888,009 | $ 2,880,032 | $ 734,528 |
Tenant Reimbursements | |||
Revenues: | |||
Rental income | $ 518,366 | $ 1,224,565 | $ 63,905 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) | Total | Capital in Excess of Par Value | Accumulated Distributions in Excess of Earnings | Class A Common Stock | Class A Common StockCommon Stock | Class T Common Stock | Class T Common StockCommon Stock |
Balance (in shares) at Dec. 31, 2015 | 20,000 | 0 | |||||
Balance at Dec. 31, 2015 | $ 200,000 | $ 199,800 | $ 0 | $ 200 | $ 0 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of common stock (in shares) | 314,618 | 5,225 | |||||
Issuance of common stock | 2,935,000 | 2,931,802 | $ 3,146 | $ 52 | |||
Distributions declared on common stock — $0.16 per Class A Share and $0.02 per Class T Share | (49,884) | (49,884) | |||||
Commissions on stock sales and related dealer manager fees | (28,968) | (28,968) | |||||
Other offering costs | (31,962) | (31,962) | |||||
Distribution and stockholder servicing fees | $ (2,000) | (2,000) | |||||
Redemptions of common stock (in shares) | 0 | ||||||
Net loss | $ (1,392,279) | (1,392,279) | $ (1,389,630) | $ (2,649) | |||
Balance (in share) at Dec. 31, 2016 | 334,618 | 5,225 | |||||
Balance at Dec. 31, 2016 | 1,629,907 | 3,068,672 | (1,442,163) | $ 3,346 | $ 52 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of common stock (in shares) | 1,102,237 | 626,121 | |||||
Issuance of common stock | 16,857,284 | 16,840,000 | $ 11,023 | $ 6,261 | |||
Distributions declared on common stock — $0.16 per Class A Share and $0.02 per Class T Share | (711,621) | (711,621) | |||||
Commissions on stock sales and related dealer manager fees | (1,129,983) | (1,129,983) | |||||
Other offering costs | (169,994) | (169,994) | |||||
Distribution and stockholder servicing fees | $ (237,105) | (237,105) | |||||
Redemptions of common stock (in shares) | 0 | ||||||
Changes in redeemable common stock | $ (87,337) | (87,337) | |||||
Net loss | (1,121,995) | (1,121,995) | $ (894,373) | $ (227,622) | |||
Balance (in share) at Dec. 31, 2017 | 1,436,855 | 1,436,855 | 631,346 | 631,346 | |||
Balance at Dec. 31, 2017 | 15,029,156 | 18,284,253 | (3,275,779) | $ 14,369 | $ 6,313 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of common stock (in shares) | 984,096 | 115,970 | |||||
Issuance of common stock | 10,757,207 | 10,746,207 | $ 9,840 | $ 1,160 | |||
Equity-based compensation (in shares) | 9,066 | ||||||
Equity-based compensation | 20,625 | 20,602 | $ 23 | ||||
Distributions declared on common stock — $0.16 per Class A Share and $0.02 per Class T Share | (1,537,187) | (1,537,187) | |||||
Commissions on stock sales and related dealer manager fees | (747,395) | (747,395) | |||||
Other offering costs | (109,044) | (109,044) | |||||
Distribution and stockholder servicing fees | $ (35,533) | (35,533) | |||||
Redemptions of common stock (in shares) | (5,300) | (5,335) | |||||
Redemptions of common stock | $ (48,015) | (47,962) | $ (53) | ||||
Changes in redeemable common stock | (94,821) | (94,821) | |||||
Net loss | (771,712) | (771,712) | $ (523,089) | $ (248,623) | |||
Balance (in share) at Dec. 31, 2018 | 2,424,682 | 2,424,682 | 747,316 | 747,316 | |||
Balance at Dec. 31, 2018 | $ 22,463,281 | $ 28,016,307 | $ (5,584,678) | $ 24,179 | $ 7,473 |
Consolidated Statements of St_2
Consolidated Statements of Stockholders' Equity (Parenthetical) - Common Stock - $ / shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Class A Common Stock | |||
Distributions declared per common share (in dollars per share) | $ 0.60 | $ 0.60 | $ 0.16 |
Class T Common Stock | |||
Distributions declared per common share (in dollars per share) | $ 0.60 | $ 0.60 | $ 0.02 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows | 12 Months Ended | ||
Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | |
Cash flows from operating activities: | |||
Net loss | $ (771,712) | $ (1,121,995) | $ (1,392,279) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | |||
Depreciation and amortization, net | 1,912,254 | 1,493,033 | 418,000 |
Amortization of deferred financing costs | 561,711 | 501,250 | 144,043 |
Straight-line rental income | (147,731) | (210,776) | (66,090) |
Equity-based compensation | 20,625 | 0 | 0 |
Changes in assets and liabilities: | |||
Rents and tenant receivables | 223,269 | (494,449) | (247,510) |
Prepaid expenses and other assets | 37,598 | (110,396) | (6,400) |
Accrued expenses and accounts payable | (170,008) | 487,383 | 366,005 |
Deferred rental income | (208,716) | 4,092 | 204,624 |
Due to affiliates | (60,301) | (14,466) | 75,524 |
Net cash provided by (used in) operating activities | 1,396,989 | 533,676 | (504,083) |
Cash flows from investing activities: | |||
Investment in real estate assets | 0 | (16,855,205) | (32,750,000) |
Payment of property escrow deposits | 0 | (250,000) | (700,000) |
Refund of property escrow deposits | 0 | 250,000 | 700,000 |
Net cash used in investing activities | 0 | (16,855,205) | (32,750,000) |
Cash flows from financing activities: | |||
Proceeds from issuance of common stock | 10,187,281 | 16,677,720 | 2,935,000 |
Redemptions of common stock | (48,015) | 0 | 0 |
Offering costs on issuance of common stock | (856,439) | (1,299,977) | (60,946) |
Distribution and stockholder servicing fees paid | (65,165) | (21,753) | 0 |
Distributions to stockholders | (912,391) | (448,362) | (33,338) |
Proceeds from credit facility | 0 | 12,700,000 | 22,000,000 |
Repayments of credit facility | (7,800,000) | (2,725,000) | 0 |
Proceeds from subordinate promissory note | 2,200,000 | 16,488,631 | 10,300,000 |
Repayment of subordinate promissory note | (3,800,000) | (25,188,631) | 0 |
Deferred financing costs paid | (17,762) | (114,687) | (1,481,584) |
Net cash (used in) provided by financing activities | (1,112,491) | 16,067,941 | 33,659,132 |
Net increase (decrease) in cash and cash equivalents | 284,498 | (253,588) | 405,049 |
Cash and cash equivalents, beginning of period | 351,461 | 605,049 | 200,000 |
Cash and cash equivalents, end of period | 635,959 | 351,461 | 605,049 |
Supplemental disclosures of non-cash investing and financing activities: | |||
Distributions declared and unpaid | 155,111 | 100,241 | 16,546 |
Change in accrued distribution and stockholder servicing fees | 35,533 | 237,105 | 2,000 |
Common stock issued through distribution reinvestment plan | 569,926 | 179,564 | 0 |
Supplemental cash flow disclosures: | |||
Interest paid | 1,269,123 | 1,102,926 | 299,341 |
Cash paid for income taxes | $ 6,467 | $ 2,491 | $ 300 |
ORGANIZATION AND BUSINESS
ORGANIZATION AND BUSINESS | 12 Months Ended |
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND BUSINESS | ORGANIZATION AND BUSINESS Cole Office & Industrial REIT (CCIT III), Inc. (the “Company”) is a non-exchange traded real estate investment trust (“REIT”) formed as a Maryland corporation, incorporated on May 22, 2014 , that elected to be taxed, and currently qualifies, as a REIT for U.S. federal income tax purposes commencing with its taxable year ended December 31, 2017. The Company primarily acquires and operates commercial real estate assets, primarily consisting of single-tenant, income-producing necessity office and industrial properties, which are leased to creditworthy tenants under long-term leases. As of December 31, 2018 , the Company owned two office and industrial properties, comprising 391,000 rentable square feet of commercial space located in two states. As of December 31, 2018 , the rentable square feet at these properties was 100% leased. Substantially all of the Company’s business is conducted through Cole Corporate Income Operating Partnership III, LP (“CCI III OP”), a Delaware limited partnership, of which the Company is the sole general partner and owns, directly or indirectly, 100% of the partnership interests. The Company is externally managed by Cole Corporate Income Management III, LLC, a Delaware limited liability company (“CCI III Management”) (formerly known as Cole Corporate Income Advisors III, LLC), an affiliate of CIM Group, LLC (“CIM”), a vertically-integrated owner and operator of real assets with multidisciplinary expertise and in-house research, acquisition, credit analysis, development, finance, leasing, and asset management capabilities headquartered in Los Angeles, California with offices in Oakland, California; Bethesda, Maryland; Dallas, Texas; New York, New York; Chicago, Illinois; and Phoenix, Arizona. On February 1, 2018, CIM acquired CCO Group, LLC and its subsidiaries (collectively, “CCO Group”) from VEREIT Operating Partnership, L.P. (“VEREIT OP”), a subsidiary of VEREIT, Inc. (“VEREIT”) (the “Transaction”). CCO Group, LLC owns and controls CCI III Management, the Company’s advisor, and is the indirect owner of CCO Capital, LLC (“CCO Capital”), the Company’s dealer manager, and CREI Advisors, LLC (“CREI Advisors”), the Company’s property manager. CCO Group serves as the Company’s sponsor and as a sponsor to Cole Credit Property Trust IV, Inc. (“CCPT IV”), Cole Credit Property Trust V, Inc. (“CCPT V”), Cole Office & Industrial REIT (CCIT II), Inc. (“CCIT II”) and CIM Income NAV, Inc. (formerly known as Cole Real Estate Income Strategy (Daily NAV), Inc.) (“CIM Income NAV”). On September 22, 2016 , the Company commenced its initial public offering on a “best efforts” basis, offering up to a maximum of $3.5 billion in shares of common stock (the “Offering”). Pursuant to the Offering, the Company offered up to $2.5 billion in shares of its common stock pursuant to the primary offering, consisting of two classes of shares: Class A common stock (“Class A Shares”) at a price of $10.00 per share (up to $1.25 billion in shares) and Class T common stock (“Class T Shares”) at a price of $9.57 per share (up to $1.25 billion in shares). Pursuant to the Offering, the Company is also offering up to $1.0 billion in shares of its common stock pursuant to the distribution reinvestment plan (the “DRIP”) at a purchase price during the Offering equal to the per share primary offering prices net of selling commissions and dealer manager fees, or $9.10 per share for both Class A Shares and Class T Shares, assuming a $10.00 per Class A Share primary offering price and a $9.57 per Class T Share primary offering price. On August 9, 2018, the Company’s board of directors (the “Board”) approved the extension of the Offering until September 22, 2019, unless the Board terminated the Offering at an earlier date or all shares being offered had been sold, in which case the Offering would be terminated. Effective December 31, 2018, the primary portion of the Offering was terminated. The Company intends to continue to issue shares of common stock pursuant to the DRIP portion of the Offering. The Board establishes an estimated per share net asset value (“NAV”) of the Company’s common stock for purposes of assisting broker-dealers in meeting their customer account statement reporting obligations under National Association of Securities Dealers Conduct Rule 2340. Distributions are reinvested in shares of the Company’s common stock under the DRIP at the estimated per share NAV as determined by the Board. Additionally, the estimated per share NAV as determined by the Board serves as the per share redemption price for the purposes of the share redemption program. On February 13, 2019 , the Board established the Company’s first estimated per share NAV of the Company’s common stock, as of December 31, 2018 , of $8.60 per share for both Class A Shares and Class T Shares. As a result, commencing on February 19, 2019 , distributions are reinvested under the DRIP at a price of $8.60 per share for both Class A Shares and Class T Shares, the estimated per share NAV as of December 31, 2018 , as determined by the Board. Additionally, $8.60 per share will serve as the most recent estimated per share NAV for purposes of the share redemption program. The Board establishes an updated per share NAV of the Company’s common stock on an annual basis. The Company's estimated per share NAV is not audited or reviewed by its independent registered public accounting firm. As of December 31, 2018 , the Company had issued approximately 3.1 million shares of common stock in the Offering, including 82,000 shares issued pursuant to the DRIP, for gross proceeds of $30.5 million ( $23.4 million in Class A Shares and $7.1 million in Class T Shares) before organization and offering costs, selling commissions and dealer manager fees of $2.2 million . In addition, the Company has paid distribution and stockholder servicing fees for Class T Shares sold in the primary portion of the Offering of $87,000 and accrued an estimated liability for future distribution and stockholder servicing fees payable of $188,000 . |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The summary of significant accounting policies presented below is designed to assist in understanding the Company’s consolidated financial statements. These accounting policies conform to accounting principles generally accepted in the United States of America (“GAAP”) in all material respects, and have been consistently applied in preparing the accompanying consolidated financial statements. Principles of Consolidation and Basis of Presentation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Real Estate Assets Real estate assets are stated at cost, less accumulated depreciation and amortization. The Company considers the period of future benefit of each respective asset to determine the appropriate useful life. The estimated useful lives of the Company’s real estate assets by class are generally as follows: Buildings 40 years Site improvements 15 years Tenant improvements Lesser of useful life or lease term Intangible lease assets Lease term Recoverability of Real Estate Assets The Company continually monitors events and changes in circumstances that could indicate that the carrying amounts of its real estate assets may not be recoverable. Impairment indicators that the Company considers include, but are not limited to: bankruptcy or other credit concerns of a property’s major tenant, such as a history of late payments, rental concessions and other factors; a significant decrease in a property’s revenues due to lease terminations; vacancies; co-tenancy clauses; reduced lease rates; changes in anticipated holding periods; or other circumstances. When indicators of potential impairment are present, the Company assesses the recoverability of the assets by determining whether the carrying amount of the assets will be recovered through the undiscounted future cash flows expected from the use of the assets and their eventual disposition. In the event that such expected undiscounted future cash flows do not exceed the carrying amount, the Company will adjust the real estate assets to their respective fair values and recognize an impairment loss. Generally, fair value will be determined using a discounted cash flow analysis and recent comparable sales transactions . No impairment indicators were identified and no impairment losses were recorded during the years ended December 31, 2018 , 2017 or 2016 . Assets Held for Sale When a real estate asset is identified by the Company as held for sale, the Company will cease recording depreciation and amortization of the assets related to the property and estimate its fair value, net of selling costs. If, in management’s opinion, the fair value, net of selling costs, of the asset is less than the carrying amount of the asset, an adjustment to the carrying amount is then recorded to reflect the estimated fair value of the property, net of selling costs. There were no assets identified as held for sale as of December 31, 2018 or 2017 . Allocation of Purchase Price of Real Estate Assets Upon the acquisition of real properties, the Company allocates the purchase price to acquired tangible assets, consisting of land, buildings and improvements, and to identified intangible assets and liabilities, consisting of the value of above- and below-market leases and the value of in-place leases and other intangibles, based in each case on their respective fair values. The Company utilizes independent appraisals to assist in the determination of the fair values of the tangible assets of an acquired property (which includes land and buildings). The information in the appraisal, along with any additional information available to the Company’s management, is used in estimating the amount of the purchase price that is allocated to land. Other information in the appraisal, such as building value and market rents, may be used by the Company’s management in estimating the allocation of purchase price to the building and to intangible lease assets and liabilities. The appraisal firm has no involvement in management’s allocation decisions other than providing this market information. The fair values of above- and below-market lease intangibles are recorded based on the present value (using a discount rate which reflects the risks associated with the leases acquired) of the difference between (1) the contractual amounts to be paid pursuant to the in-place leases and (2) an estimate of fair market lease rates for the corresponding in-place leases, which is generally obtained from independent appraisals, measured over a period equal to the remaining non-cancelable term of the lease including, for below-market leases, any bargain renewal periods. The above- and below-market lease intangibles are capitalized as intangible lease assets or liabilities, respectively. Above-market leases are amortized as a reduction to rental income over the remaining terms of the respective leases. Below-market leases are amortized as an increase to rental income over the remaining terms of the respective leases, including any bargain renewal periods. In considering whether or not the Company expects a tenant to execute a bargain renewal option, the Company evaluates economic factors and certain qualitative factors at the time of acquisition, such as the financial strength of the tenant, the remaining lease term, the tenant mix of the leased property, the Company’s relationship with the tenant and the availability of competing tenant space. If a lease were to be terminated prior to its stated expiration, all unamortized amounts of above- or below-market lease intangibles relating to that lease would be recorded as an adjustment to rental income. The fair values of in-place leases include estimates of direct costs associated with obtaining a new tenant and opportunity costs associated with lost rental and other property income which are avoided by acquiring a property with an in-place lease. Direct costs associated with obtaining a new tenant include leasing commissions, legal and other related expenses, and are estimated in part by utilizing information obtained from independent appraisals and management’s consideration of current market costs to execute a similar lease. The intangible values of opportunity costs, which are calculated using the contractual amounts to be paid pursuant to the in-place leases over a market absorption period for a similar lease, are capitalized as intangible lease assets and are amortized to expense over the remaining term 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. The Company may acquire certain properties subject to contingent consideration arrangements that may obligate the Company to pay additional consideration to the seller based on the outcome of future events. Additionally, the Company may acquire certain properties for which it funds certain contingent consideration amounts into an escrow account pending the outcome of certain future events. The outcome may result in the release of all or a portion of the escrow funds to the Company or the seller or a combination thereof. Upon adoption of ASU 2017-01 (as defined below) in April 2017, contingent consideration arrangements for asset acquisitions are recognized when the contingency is resolved. The determination of the amount of contingent consideration arrangements is based on the probability of several possible outcomes as identified by management. The Company estimates the fair value of assumed mortgage notes payable based upon indications of current market pricing for similar types of debt financing with similar maturities. Assumed mortgage notes payable are initially recorded at their estimated fair value as of the assumption date, and any difference between such estimated fair value and the mortgage note’s outstanding principal balance is amortized or accreted to interest expense over the term of the respective mortgage note payable. The determination of the fair values of the real estate assets and liabilities acquired requires the use of significant assumptions with regard to the current market rental rates, rental growth rates, capitalization and discount rates, interest rates and other variables. The use of alternative estimates may result in a different allocation of the Company’s purchase price, which could materially impact the Company’s results of operations. In April 2017, the Company elected to early adopt Accounting Standards Update (“ASU”) No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business (“ASU 2017-01”), which clarifies the definition of a business by adding guidance to assist entities in evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. Beginning in April 2017, all real estate acquisitions qualified as asset acquisitions, and as such, acquisition-related fees and certain acquisition-related expenses related to these asset acquisitions are now capitalized and allocated to tangible and intangible assets and liabilities as described above. Other acquisition-related expenses, such as advisor reimbursements, continue to be expensed as incurred and are included in transaction-related expenses on the accompanying consolidated statements of operations. Prior to the adoption of ASU 2017-01 in April 2017, all of the Company’s real estate acquisitions were accounted for as business combinations, and as such, acquisition-related expenses related to these business combination acquisitions were expensed as incurred. Prior to April 2017, acquisition-related expenses included within transaction-related expenses in the Company’s consolidated statements of operations primarily consisted of legal, deed transfer and other costs related to real estate purchase transactions, including costs incurred for deals that were not consummated. The Company expects any future acquisitions to qualify as asset acquisitions and, as such, the Company will allocate the purchase price to acquired tangible assets and identified intangible assets and liabilities on a relative fair value basis. Cash and Cash Equivalents Cash and cash equivalents includes cash in bank accounts. The Company deposits cash with several high quality financial institutions. These deposits are guaranteed by the Federal Deposit Insurance Company (“FDIC”) up to an insurance limit of $250,000. At times, the Company’s cash and cash equivalents may exceed federally insured levels. Although the Company bears risk on amounts in excess of those insured by the FDIC, it has not experienced and does not anticipate any losses due to the high quality of the institutions where the deposits are held. Deferred Financing Costs Deferred financing costs represent commitment fees, legal fees and other costs associated with obtaining commitments for financing. The presentation of all deferred financing costs, other than those associated with the revolving loan portion of the credit facility, are classified such that the debt issuance costs related to a recognized debt liability are presented on the consolidated balance sheets as a direct deduction from the carrying amount of the related debt liability rather than as an asset. Debt issuance costs related to securing the Company’s revolving line of credit are presented as an asset and amortized ratably over the term of the line of credit arrangement. The Company’s total deferred costs, net in the accompanying consolidated balance sheets relate only to the revolving loan portion of the Credit Facility (as defined in Note 6 — Credit Facility and Subordinate Promissory Note). As of December 31, 2018 and 2017 , the Company had $407,000 and $1.0 million , respectively, of deferred financing costs, net of accumulated amortization, related to the revolving loan portion of the Credit Facility. Costs incurred in seeking financing transactions that do not close are expensed in the period in which it is determined the financing will not close. Distribution and Stockholder Servicing Fees The Company pays CCO Capital a distribution and stockholder servicing fee for Class T Shares sold in the primary portion of the Offering which, prior to the Board’s determination of the estimated per share NAV, was calculated on a daily basis in the amount of 1/365th of 1.0% of the purchase price per share of Class T Shares sold in the primary portion of the Offering. Commencing on February 19, 2019 , the distribution and stockholder servicing fee for Class T Shares is calculated on a daily basis in an amount equal to 1/365th of 1.0% of the per share NAV. The aggregate distribution and stockholder servicing fee for Class T Shares will not exceed an amount equal to 4.0% of the total gross offering proceeds of Class T Shares sold in the primary portion of the Offering. The Company will cease paying the distribution and stockholder servicing fee with respect to Class T Shares sold in the Offering at the earliest of: (i) the end of the month in which the transfer agent, on the Company’s behalf, determines that total selling commissions and distribution and stockholder servicing fees paid by a stockholder within his or her individual account would be equal to 4.0% of the stockholder’s total gross investment amount at the time of the purchase of the primary Class T Shares held in such account, or a lower limit agreed upon between the Company’s dealer manager and the participating broker-dealer at the time such Class T Shares were sold; (ii) the date on which the aggregate underwriting compensation from all sources equals 10.0% of the gross offering proceeds (i.e., excluding proceeds from sales pursuant to the DRIP); (iii) the fourth anniversary of the last day of the month in which the Offering (excluding the offering of shares pursuant to the DRIP) terminates; (iv) the date such Class T Share is no longer outstanding; and (v) the date the Company effects a liquidity event (such as the sale of the Company, the sale of all or substantially all of the Company’s assets, a merger or similar transaction, the listing of the Company’s shares of common stock for trading on a national securities exchange or an alternative strategy that would result in a significant increase in the opportunities for stockholders to dispose of their shares). CCO Capital may, in its discretion, reallow to participating broker-dealers all or a portion of the distribution and stockholder servicing fee. At the time the Company ceases paying the distribution and stockholder servicing fee with respect to an outstanding Class T Share pursuant to the provisions above, such Class T Share will convert into a number of Class A Shares (including any fractional shares) with an equivalent net asset value as such share. The distribution and stockholder servicing fee is paid monthly in arrears. An estimated liability for future distribution and stockholder servicing fees payable to CCO Capital is recognized at the time each Class T Share is sold and included in due to affiliates in the consolidated balance sheets with a corresponding decrease to capital in excess of par value. Due to Affiliates Certain affiliates of CCI III Management received, and will continue to receive, fees, reimbursements and compensation in connection with services provided relating to the Offering and the acquisition, management, financing and leasing of the Company’s assets. As of December 31, 2018 and 2017 , $188,000 and $278,000 , respectively, was due to CCI III Management and its affiliates for such services, as discussed in Note 8 — Related-Party Transactions and Arrangements to these consolidated financial statements. Redeemable Common Stock Under the Company’s share redemption program, the Company’s obligation to redeem shares of its outstanding common stock is limited, among other things, to the net proceeds received by the Company from the sale of shares under the DRIP during the quarter, net of shares redeemed. The Company records the maximum amount that is redeemable under the share redemption program as redeemable common stock outside of permanent equity in its consolidated balance sheets. Changes in the amount of redeemable common stock from period to period are recorded as an adjustment to capital in excess of par value. Revenue Recognition Certain properties have leases where the minimum rental payment increases during the term of the lease. The Company records rental income for the full term of each lease on a straight-line basis when earned and collectability is reasonably assured. When the Company acquires a property, the terms of existing leases are considered to commence as of the acquisition date for the purpose of this calculation. The Company defers the recognition of contingent rental income, such as percentage rents, until the specific target that triggers the contingent rental income is achieved. Expected reimbursements from tenants for recoverable real estate taxes and operating expenses are included in tenant reimbursement income in the period when such costs are incurred. Effective January 1, 2018, the Company adopted ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”), which supersedes the revenue recognition requirements in Revenue Recognition, Accounting Standards Codification Topic 605 and requires an entity to recognize revenue in a way that depicts the transfer of promised goods or 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 Company records revenue for real estate taxes and insurance reimbursed by its tenants on the leased properties, with offsetting expenses in real estate taxes and property operating expenses, respectively, within the consolidated statements of operations as the Company has concluded it is the primary obligor. The Company has identified its revenue streams as rental income from leasing arrangements and tenant reimbursement income, which are outside of the scope of Topic 606. The Company adopted ASU 2014-09 using the modified retrospective approach and determined it did not have a material impact on the Company’s consolidated financial statements. The Company continually reviews receivables related to rent, including any straight-line rent, and current and future operating expense reimbursements from tenants and determines their collectability by taking into consideration the tenant’s payment history, the financial condition of the tenant, business conditions in the industry in which the tenant operates and economic conditions in the area in which the property is located. In the event that the collectability of a receivable is uncertain, the Company will record an increase in the allowance for uncollectible accounts. As of December 31, 2018 and 2017 , the C ompany did not have an allowance for uncollectible accounts. Income Taxes The Company elected to be taxed and qualified as a REIT for federal income tax purposes under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended, (the “Internal Revenue Code”), beginning with its taxable year ended December 31, 2017. The Company will generally not be subject to federal corporate income tax to the extent it distributes its taxable income to its stockholders, and so long as it, among other things, distributes at least 90% of its annual taxable income (computed without regard to the dividends paid deduction and excluding net capital gains). REITs are subject to a number of other organizational and operational requirements. Even if the Company maintains its qualification for taxation as a REIT, it or its subsidiaries may be subject to certain state and local taxes on its income and property, and federal income and excise taxes on its undistributed income. For the period from May 22, 2014 (date of inception) to December 31, 2016, the Company did not meet all of the criteria to qualify as a REIT under the Internal Revenue Code. Specifically, the Company did not have enough stockholders for a sufficient number of days in 2016. As such, the Company was taxable as a C Corporation for the taxable year ended December 31, 2016, and was subject to regular taxes on its income for such period. However, the Company incurred a taxable loss for the period ending December 31, 2016, and as such, there was no federal income tax liability for this period. Net Loss and Distributions Per Share The Company has two classes of common stock. Accordingly, the Company utilizes the two-class method to determine its earnings per share, which results in different earnings per share for each of the classes. Under the two-class method, earnings per share of each class of common stock are computed by dividing the sum of the distributed earnings to common stockholders and undistributed earnings allocated to common stockholders by the weighted average number of shares for each class of common stock for the respective period. The distributed earnings to Class T Share common stockholders represents distributions declared less the distribution and stockholder servicing fees paid with respect to Class T Shares sold in the primary portion of the Offering. Diluted income per share, when applicable, considers the effect of any potentially dilutive share equivalents, of which the Company had none for each of the years ended December 31, 2018 , 2017 or 2016 . Distributions per share are calculated based on the authorized daily distribution rate. Offering and Related Costs CCI III Management funds all of the organization and offering costs on the Company’s behalf (excluding selling commissions, dealer manager fees and distribution and stockholder servicing fees) and may be reimbursed for such costs up to 1.0% of the gross proceeds from the Offering. As of December 31, 2018 , CCI III Management had paid organization and offering costs in excess of 1.0% of the gross proceeds from the Offering. These excess costs were not included in the financial statements of the Company because such costs were not a liability of the Company as they exceeded 1.0% of the aggregate gross proceeds from the Offering. The Company expenses organization costs as incurred and records offering costs, which include items such as legal and accounting fees, marketing, personnel, promotional and printing costs, as a reduction of capital in excess of par value along with selling commissions, and dealer manager fees in the period in which they become payable. Reportable Segment The Company’s commercial real estate assets consist primarily of single-tenant, income-producing necessity office and industrial properties, which are leased to creditworthy tenants under a long-term net leases. The commercial properties are geographically diversified throughout the United States and have similar economic characteristics. The Company’s management evaluates operating performance on an overall portfolio level; therefore, the Company’s properties are one reportable segment. Recent Accounting Pronouncements From time to time, new accounting pronouncements are issued by various standard setting bodies that may have an impact on the Company’s accounting and reporting. Except as otherwise stated below, the Company is currently evaluating the effect that certain new accounting requirements may have on the Company’s accounting and related reporting and disclosures in the Company’s consolidated financial statements: In February 2016, the Financial Accounting Standards Board (the “FASB”) issued ASU No. 2016-02, Leases (Topic 842) (“ASU 2016-02”). The amendments in this update require that most lease obligations be recognized as a right of use asset with a corresponding liability on the balance sheet. The guidance also requires additional qualitative and quantitative disclosures to assess the amount, timing and uncertainty of cash flows arising from leases. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with early adoption permitted. The FASB has subsequently issued other related ASU, which amend ASU 2016-02 to provide transition practical expedients that an entity may elect to apply and other guidance. In July 2018, the FASB issued ASU No. 2018-11, Leases: Targeted Improvements, which provides companies with an additional transition option that would permit the application of ASU 2016-02 as of the adoption date rather than to all periods presented. The Company will use this transition option upon adoption of the new standard on January 1, 2019 and use the effective date as the date of initial application. Consequently, financial information will not be updated and the disclosures required under the new standard will not be provided for dates and periods before January 1, 2019. The Company adopted the guidance on January 1, 2019 using the modified retrospective approach. The Company has finalized its assessment of its inventory of leases that will be impacted by adoption of the new guidance. The Company will elect the “package of practical expedients,” which permits the Company to not reassess under the new standard prior conclusions about lease identification, lease classification and initial direct costs. The accounting for lease components will largely be unchanged from existing GAAP and the Company will elect the practical expedient to not separate non-lease components from lease components. The Company does not expect the adoption of ASU 2016-02 to have a material impact on the accounting treatment and disclosure of the Company’s net leases, which are the primary source of the Company’s revenues. The Company does not have material leases where it is the lessee. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326) (“ASU 2016-13”). ASU 2016-13 is intended to improve financial reporting requiring more timely recognition of credit losses on loans and other financial instruments that are not accounted for at fair value through net income, including loans held for investment, held-to-maturity debt securities, trade and other receivables, net investment in leases and other such commitments. ASU 2016-13 requires that financial assets measured at amortized cost be presented at the net amount expected to be collected, through an allowance for credit losses that is deducted from the amortized cost basis. The amendments in ASU 2016-13 require the Company to measure all expected credit losses based upon historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the financial assets and eliminates the “incurred loss” methodology under current GAAP. ASU 2016-13 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2019. Early adoption is permitted for fiscal years, and interim periods within those years, beginning after December 15, 2018. The Company is currently evaluating the impact this amendment will have on its consolidated financial statements. In August 2018, the FASB issued ASU No. 2018-13, Changes to the Disclosure Requirements for Fair Value Measurement (“ASU 2018-13”). This ASU amends and removes several disclosure requirements including the valuation processes for Level 3 fair value measurements. ASU 2018-13 also modifies some disclosure requirements and requires additional disclosures for changes in unrealized gains and losses included in other comprehensive income for recurring Level 3 fair value measurements and requires the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. The provisions of ASU 2018-13 are effective January 1, 2020 using a prospective transition method for amendments effecting changes in unrealized gains and losses, significant unobservable inputs used to develop Level 3 fair value measurements and narrative description on uncertainty of measurements. The remaining provisions of the ASU are to be applied retrospectively, and early adoption is permitted. The Company is evaluating the impact of this ASU’s adoption, and does not believe this ASU will have a material impact on its consolidated financial statements. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS GAAP defines fair value, establishes a framework for measuring fair value and requires disclosures about fair value measurements. GAAP emphasizes that fair value is intended to be a market-based measurement, as opposed to a transaction-specific measurement. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions. Depending on the nature of the asset or liability, various techniques and assumptions can be used to estimate the fair value. Assets and liabilities are measured using inputs from three levels of the fair value hierarchy, as follows: Level 1 — Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. An active market is defined as a market in which transactions for the assets or liabilities occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2 — Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active (markets with few transactions), inputs other than quoted prices that are observable for the asset or liability (i.e., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data correlation or other means (market corroborated inputs). Level 3 — Unobservable inputs, which are only used to the extent that observable inputs are not available, reflect the Company’s assumptions about the pricing of an asset or liability. The following describes the methods the Company uses to estimate the fair value of the Company’s financial assets and liabilities: Credit facility and subordinate promissory note — The fair value is estimated by discounting the expected cash flows based on estimated borrowing rates available to the Company as of the measurement date. These financial instruments are valued using Level 2 inputs. As of December 31, 2018 , the estimated fair value of the Company’s debt was $24.3 million , compared to a carrying value of $24.2 million . As of December 31, 2017 , the estimated fair value of the Company’s debt was $33.8 million , compared to a carrying value of $33.6 million . The carrying and fair values exclude net deferred financing costs. Other financial instruments — The Company considers the carrying values of its cash and cash equivalents, tenant receivables, accrued expenses and accounts payable, other liabilities, due to affiliates and distributions payable to approximate their fair values because of the short period of time between their origination and their expected realization as well as their highly-liquid nature. Due to the short-term maturities of these instruments, Level 1 inputs are utilized to estimate the fair value of these financial instruments. Considerable judgment is necessary to develop estimated fair values of financial assets and liabilities. Accordingly, the estimates presented herein are not necessarily indicative of the amounts the Company could realize, or be liable for, on disposition of the financial assets and liabilities. As of December 31, 2018 and 2017 , there have been no transfers of financial assets or liabilities between fair value hierarchy levels. |
REAL ESTATE ASSET
REAL ESTATE ASSET | 12 Months Ended |
Dec. 31, 2018 | |
Real Estate [Abstract] | |
REAL ESTATE ASSET | REAL ESTATE ASSETS 2018 Property Acquisitions During the year ended December 31, 2018 , the Company did not acquire any properties. 2017 Property Acquisition During the year ended December 31, 2017, the Company acquired one industrial property, leased to Actuant Corporation, for a purchase price of $16.9 million (the “2017 Acquisition”), which includes $355,000 of external acquisition-related expenses that were capitalized in accordance with ASU 2017-01. Prior to the Company’s adoption of ASU 2017-01, costs related to the property acquisitions were expensed as incurred. The Company purchased the 2017 Acquisition with net proceeds from the Offering and available borrowings. The Company allocated the purchase price of this property to the fair value of the assets acquired. The following table summarizes the purchase price allocation for the 2017 Acquisition: December 31, 2017 Land $ 937,691 Buildings and improvements 14,287,443 Acquired in-place lease (1) 1,630,071 Total purchase price $ 16,855,205 ______________________ (1) The weighted average amortization period for the acquired in-place lease was 16.2 years for the 2017 Acquisition. 2016 Property Acquisition During the year ended December 31, 2016, the Company acquired one office property, leased to Siemens Corporation, for a purchase price of $32.8 million (the “2016 Acquisition”). The Company purchased the 2016 Acquisition with net proceeds from the Offering and available borrowings. The Company allocated the purchase price of this property to the fair value of the assets acquired. The following table summarizes the purchase price allocation for the 2016 Acquisition: December 31, 2016 Land $ 2,307,312 Buildings and improvements 26,971,327 Acquired in-place lease (1) 3,471,361 Total purchase price $ 32,750,000 ______________________ (1) The weighted average amortization period for the acquired in-place lease was 9.6 years for the 2016 Acquisition. The Company recorded revenue for the year ended December 31, 2016 of $798,000 and a net loss for the year ended December 31, 2016 of $439,000 related to the 2016 Acquisition. In addition, the Company recorded $765,000 of acquisition-related expenses for the year ended December 31, 2016, which is included in transaction-related expenses on the consolidated statements of operations. The following table summarizes selected financial information of the Company as if the 2016 Acquisition was completed on January 1, 2015. The table below presents the Company’s estimated revenue and net loss, on a pro forma basis, for the years ended December 31, 2016 and 2015: Year Ended December 31, 2016 2015 Pro forma basis (unaudited): Revenue $ 2,922,263 $ 2,922,263 Net loss $ (1,612,080 ) $ (1,418,625 ) The unaudited pro forma information for the year ended December 31, 2016 was adjusted to exclude $765,000 of acquisition-related fees and expenses recorded during the year ended December 31, 2016. Accordingly, these costs were instead recognized in the unaudited pro forma information for the year ended December 31, 2015. The unaudited pro forma information is presented for informational purposes only and may not be indicative of what actual results of operations would have been had the transactions occurred at the beginning of the period, nor does it purport to represent the results of future operations. Asset Concentration As of December 31, 2018 , the Company had two tenants that constitute significant asset concentrations. The tenant of the 2017 Acquisition, Enerpac, is a significant tenant and is a subsidiary of Actuant Corporation. The audited financial statements for Actuant Corporation, for the fiscal year ended August 31, 2018, are publicly available on the SEC’s web site, http://www.sec.gov. The tenant of the 2016 Acquisition, Siemens Corporation, is a significant tenant and is a subsidiary of Siemens AG. The audited financial statements for Siemens AG, for the fiscal year ended September 30, 2018, can be found on their website at https://www.siemens.com/investor/pool/en/investor_relations/Siemens_SAG2018_E.pdf. |
INTANGIBLE LEASE ASSETS
INTANGIBLE LEASE ASSETS | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE LEASE ASSETS | INTANGIBLE LEASE ASSETS The Company’s intangible lease assets consisted of the following as of December 31, 2018 and 2017 : As of December 31, 2018 2017 In-place leases, net of accumulated amortization of $943,541 and $480,483, respectively (with a weighted average life remaining of 9.8 years and 10.8 years, respectively) $ 4,157,891 $ 4,620,949 Amortization expense for the in-place leases is included in depreciation and amortization in the accompanying consolidated statement of operations. The following table summarizes the amortization expense related to the in-place lease assets for the years ended December 31, 2018 , 2017 and 2016 : Year Ended December 31, 2018 2017 2016 In-place lease amortization $ 463,058 $ 374,832 $ 105,651 As of December 31, 2018 , the estimated amortization expense relating to the intangible lease assets for each of the five succeeding fiscal years is as follows: Amortization Expense Year ending December 31, In-Place Leases 2019 $ 463,058 2020 $ 463,058 2021 $ 463,058 2022 $ 463,058 2023 $ 463,058 |
CREDIT FACILITY AND SUBORDINATE
CREDIT FACILITY AND SUBORDINATE PROMISSORY NOTE | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
CREDIT FACILITY AND SUBORDINATE PROMISSORY NOTE | CREDIT FACILITY AND SUBORDINATE PROMISSORY NOTE As of December 31, 2018 , the Company had $24.2 million of debt outstanding, with a weighted average interest rate of 4.7% and a weighted average term to maturity of nine months . The following table summarizes the debt balances as of December 31, 2018 and 2017, respectively, and the debt activity for the year ended December 31, 2018 : During the Year Ended December 31, 2018 Balance as of Debt Issuance Repayments Accretion Balance as of Credit facility $ 31,975,000 $ — $ (7,800,000 ) $ — $ 24,175,000 Subordinate promissory note 1,600,000 2,200,000 (3,800,000 ) — — Total debt $ 33,575,000 $ 2,200,000 $ (11,600,000 ) $ — $ 24,175,000 Credit Facility As of December 31, 2018 , the Company had $24.2 million of debt outstanding under its secured credit facility (the “Credit Facility”) with JPMorgan Chase Bank, N.A. (“JPMorgan Chase”), as administrative agent, and the lenders under the credit agreement (as amended, the “Credit Agreement”), that provides for borrowings of up to $100.0 million in revolving loans (the “Revolving Loans”). With respect to the Company’s $24.2 million of Revolving Loans maturing on September 23, 2019 , the Company expects to extend the maturity date, subject to satisfying certain conditions contained in the Credit Agreement. These conditions include providing notice of the election and paying an extension fee of 0.2% of the maximum amount of the Revolving Loans. Depending upon the type of loan specified and overall leverage ratio, the Credit Facility bears interest at (i) the one-month, two-month, three-month or six-month London Interbank Offered Rate (“LIBOR”) multiplied by the statutory reserve rate (the “Eurodollar Rate”) plus an interest rate spread ranging from 2.20% to 2.45% ; or (ii) a base rate ranging from 1.20% to 1.45% , plus the greater of: (a) JPMorgan Chase’s Prime Rate (as defined in the Credit Agreement); (b) the Federal Funds Effective Rate (as defined in the Credit Agreement) plus 0.50% ; or (c) the one-month LIBOR multiplied by the statutory reserve rate plus 1.0% . As of December 31, 2018 , the Revolving Loans outstanding totaled $24.2 million at a weighted average interest rate of 4.7% . The Company had $75.8 million in unused capacity, subject to borrowing availability, as of December 31, 2018 . The Credit Agreement contains provisions with respect to covenants, events of default and remedies customary for facilities of this nature. In particular, the Credit Agreement requires the Company to maintain a minimum consolidated net worth greater than or equal to 75% of the equity issued from the date of the Credit Agreement, a leverage ratio no greater than 60% , and a fixed charge coverage ratio equal to or greater than 1.50 . The Company believes it was in compliance with the financial covenants of the Credit Agreement as of December 31, 2018 . On September 23, 2016, the Company entered into a $30.0 million subordinate, unsecured, revolving line of credit with VEREIT OP (the “Subordinate Promissory Note”). The Subordinate Promissory Note bore interest at a rate per annum equal to the sum of (a) one-month LIBOR, (b) the Credit Facility Margin (as defined in the Subordinate Promissory Note) and (c) 1.75% , with accrued interest payable monthly in arrears and principal due upon maturity. No amounts were outstanding under the Subordinate Promissory Note, which matured and expired on September 30, 2018. No financing coordination fees were paid to the advisor or its affiliates in connection with the Subordinate Promissory Note. Maturities The following table summarizes the scheduled aggregate principal repayments for the Company’s outstanding debt as of December 31, 2018 for each of the five succeeding fiscal years and the period thereafter: Principal Repayments 2019 $ 24,175,000 2020 — 2021 — 2022 — 2023 — Thereafter — Total $ 24,175,000 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Litigation In the ordinary course of business, the Company may become subject to litigation and claims. The Company is not aware of any material pending legal proceedings, other than ordinary routine litigation incidental to the Company’s business, to which the Company is a party or of which the Company’s properties are the subject. Environmental Matters In connection with the ownership and operation of real estate, the Company may potentially be liable for costs and damages related to environmental matters. In addition, the Company may own or acquire certain properties that are subject to environmental remediation. Generally, the seller of the property, the tenant of the property and/or another third party is responsible for environmental remediation costs related to a property. Additionally, in connection with the purchase of certain properties, the respective sellers and/or tenants may agree to indemnify the Company against future remediation costs. The Company also carries environmental liability insurance on its properties that provides limited coverage for any remediation liability and/or pollution liability for third-party bodily injury and/or property damage claims for which the Company may be liable. The Company is not aware of any environmental matters which it believes are reasonably likely to have a material effect on its results of operations, financial condition or liquidity. |
RELATED-PARTY TRANSACTIONS AND
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS | RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS The Company has incurred, and will continue to incur, commissions, fees and expenses payable to CCI III Management and certain of its affiliates in connection with the Offering and the acquisition, management and disposition of its assets. Selling commissions and dealer manager fees In connection with the Offering, which was terminated on December 31, 2018 , CCO Capital, the Company’s dealer manager, which is affiliated with CCI III Management, received selling commissions of up to 7.0% and 3.0% of gross offering proceeds from the primary portion of the Offering for Class A Shares and Class T Shares, respectively. CCO Capital reallowed 100% of selling commissions earned to participating broker-dealers. In addition, 2.0% of gross offering proceeds from the primary portion of the Offering for both Class A Shares and Class T Shares was paid to CCO Capital as a dealer manager fee. CCO Capital, in its sole discretion, reallowed all or a portion of its dealer manager fee to participating broker-dealers. No selling commissions or dealer manager fees are paid to CCO Capital or other participating broker-dealers with respect to shares sold pursuant to the DRIP. Organization and offering expenses All other organization and offering expenses associated with the sale of the Company’s common stock (excluding selling commissions, dealer manager fees and distribution and stockholder servicing fees) were paid by CCI III Management or its affiliates and were reimbursed by the Company up to 1.0% of aggregate gross offering proceeds, including proceeds from sales of shares under the DRIP. As of December 31, 2018 , CCI III Management had paid organization and offering expenses in excess of the 1.0% of aggregate gross offering proceeds in connection with the Offering. These excess amounts were not included in the consolidated financial statements of the Company because such amounts were not a liability of the Company as they exceeded 1.0% of gross proceeds from the Offering. Since the Offering was terminated on December 31, 2018, these excess amounts will not be paid. Distribution and stockholder servicing fees The Company pays CCO Capital a distribution and stockholder servicing fee for Class T Shares that, prior to the Board’s determination of the estimated per share NAV, was calculated on a daily basis in an amount equal to 1/365th of 1.0% of the purchase price per share of the Class T Shares sold in the primary portion of the Offering. Commencing on February 19, 2019 , the distribution and stockholder servicing fee for Class T Shares is calculated on a daily basis in an amount equal to 1/365th of 1.0% of the per share NAV. The distribution and stockholder servicing fee is paid monthly in arrears from cash flow from operations or, if the Company’s cash flow from operations is not sufficient to pay the distribution and stockholder servicing fee, from borrowings in anticipation of future cash flow. An estimated liability for future distribution and stockholder servicing fees payable to CCO Capital was recognized at the time each Class T Share was sold and included in due to affiliates in the consolidated balance sheets with a corresponding decrease to capital in excess of par value. The Company will cease paying the distribution and stockholder servicing fee with respect to Class T Shares at the earliest of (i) the end of the month in which the total distribution and stockholder servicing fees paid by a stockholder within his or her individual account would be equal to 4.0% of the stockholder’s total gross investment amount at the time of the purchase of the primary Class T Shares held in such account, or a lower limit agreed upon between the Company’s dealer manager and the participating broker-dealer at the time such Class T Shares were sold; (ii) the date on which the aggregate underwriting compensation from all sources equals 10.0% of the gross proceeds from the aggregate sale of the Class A Shares and Class T Shares in the Offering, excluding proceeds from sales pursuant to the DRIP; (iii) the fourth anniversary of the last day of the month in which the Offering (excluding the offering of shares pursuant to the DRIP) terminates; (iv) the date such Class T Share is no longer outstanding; and (v) the date the Company effects a liquidity event. CCO Capital may, in its discretion, reallow to participating broker-dealers all or a portion of the distribution and stockholder servicing fee for services that such participating broker-dealers perform in connection with the distribution of Class T Shares. At the time the Company ceases paying the distribution and stockholder servicing fee with respect to an outstanding Class T Share pursuant to the provisions above, such Class T Share will convert into a number of Class A Shares (including any fractional shares) with an equivalent net asset value as such Class T Share. The Company cannot predict when this will occur. No distribution and stockholder servicing fees are paid to CCO Capital or other participating broker-dealers with respect to shares sold pursuant to the DRIP. Acquisition fees and expenses The Company pays CCI III Management or its affiliates acquisition fees of up to 2.0% of: (i) the contract purchase price of each property or asset the Company acquires; (ii) the amount paid in respect of the development, construction or improvement of each asset the Company acquires; (iii) the purchase price of any loan the Company acquires; and (iv) the principal amount of any loan the Company originates. In addition, the Company reimburses CCI III Management or its affiliates for acquisition-related expenses incurred in the process of acquiring a property or the origination or acquisition of a loan, so long as the total acquisition fees and expenses relating to the transaction do not exceed 6.0% of the contract purchase price, unless otherwise approved by a majority of the Board, including a majority of the independent directors, as commercially competitive, fair and reasonable to the Company. Advisory fees and expenses Pursuant to the advisory agreement, the Company pays CCI III Management a monthly advisory fee based upon the Company’s monthly average asset value, which is equal to the following amounts: (i) an annualized rate of 0.75% paid on the Company’s average asset value that is between $0 and $2.0 billion ; (ii) an annualized rate of 0.70% paid on the Company’s average asset value that is between $2.0 billion and $4.0 billion ; and (iii) an annualized rate of 0.65% paid on the Company’s average asset value that are over $4.0 billion . During the year ended December 31, 2018 , these advisory fees exceeded the expense limit of the greater of 2.0% of the average invested assets or 25.0% of net income (see operating expenses below) and were not recognized in the consolidated financial statements of the Company because such amounts were not contractually payable by the Company. As of December 31, 2018 , $576,000 of advisory fees exceeded such expense limit. Subsequent to December 31, 2018 , CCI III Management waived its right to receive these amounts, even if future operating expenses are below the expense limits. Additionally, CCI III Management waived its right to receive a monthly advisory fee during the year ended December 31, 2019. Operating expenses The Company reimburses CCI III Management or its affiliates for the operating expenses they paid or incurred in connection with advisory and administrative services provided to the Company, subject to the limitation that the Company will not reimburse CCI III Management or its affiliates for any amount by which the operating expenses (including the advisory fee) at the end of the four preceding fiscal quarters exceed the greater of (i) 2.0% of average invested assets, or (ii) 25.0% of net income, excluding any additions to reserves for depreciation, bad debts or other similar non-cash reserves and excluding any gain from the sale of assets for that period. The Company will not reimburse CCI III Management or its affiliates for compensation paid to the Company’s executive officers or employees of CCI III Management in connection with the services for which CCI III Management or its affiliates receive an acquisition fee, financing coordination fee or disposition fee. During the year ended December 31, 2018 , no operating expenses were reimbursed by the Company. During the year ended December 31, 2018 , CCI III Management paid or reimbursed the Company for operating expenses in excess of the greater of 2.0% of average invested assets or 25.0% of net income, which were not recognized in the consolidated financial statements of the Company because such amounts were not contractually payable by the Company. As of December 31, 2018 , $1.5 million of operating expenses exceeded such expense limit. Accordingly, the Company did not reimburse CCI III Management for any such expenses for the years ended December 31, 2018 , 2017 and 2016. However, these amounts may become payable if future operating expenses are below the expense limits. Financing coordination fees If CCI III Management provides services in connection with the origination, assumption or refinancing of any debt to acquire properties or to make other permitted investments, the Company will pay CCI III Management a financing coordination fee equal to 1.0% of the amount available and/or outstanding under such financing. However, CCI III Management will not be entitled to a financing coordination fee on any debt where CCI III Management previously received a fee unless (i) the maturity date of the refinanced debt was scheduled to occur less than one year after the date of the refinancing and the new loan has a term of at least five years or (ii) the new loan is approved by a majority of the independent directors; and provided, further, that no financing coordination fee will be paid in connection with loans advanced by an affiliate of CCI III Management. Disposition fees If CCI III Management or its affiliates provide a substantial amount of services (as determined by a majority of the Company’s independent directors) in connection with the sale of one or more properties (or the Company’s entire portfolio), the Company will pay CCI III Management or its affiliates a disposition fee in an amount equal to up to one-half of the real estate or brokerage commission paid by the Company to third parties on the sale of such properties, not to exceed 1.0% of the contract price of the properties sold; provided, however, in no event may the total disposition fees paid to CCI III Management, its affiliates, and unaffiliated third parties, exceed the lesser of the customary competitive real estate commission or an amount equal to 6.0% of the contract sales price. In addition, if CCI III Management or its affiliates provides a substantial amount of services (as determined by a majority of the Company’s independent directors) in connection with the sale of one or more assets other than properties, the Company may separately compensate CCI III Management or its affiliates at such rates and in such amounts as the Board, including a majority of the independent directors, and CCI III Management agree upon, not to exceed an amount equal to 1.0% of the contract price of the assets sold. During the years ended December 31, 2018 , 2017 and 2016 , no disposition fees were incurred for any such services provided by CCI III Management or its affiliates. Subordinated performance fees The Company will pay a subordinated performance fee under one of the following alternative events: (1) if the Company’s shares are listed on a national securities exchange, CCI III Management, or its affiliates, will be entitled to a subordinated performance fee equal to 15.0% of the amount, if any, by which (i) the market value of the Company’s outstanding stock plus distributions paid by the Company prior to listing, exceeds (ii) the sum of the total amount of capital raised from stockholders and the amount of distributions necessary to generate a 6.0% annual cumulative, non-compounded return to stockholders; (2) if the Company is sold or its assets are liquidated, CCI III Management will be entitled to a subordinated performance fee equal to 15.0% of the net sale proceeds remaining after stockholders have received, from regular distributions plus special distributions paid from proceeds of such sale, a return of their net capital invested and a 6.0% annual cumulative, non-compounded return; or (3) upon termination of the advisory agreement, CCI III Management may be entitled to a subordinated performance fee similar to the fee to which it would have been entitled had the portfolio been liquidated (based on an independent appraised value of the portfolio) on the date of termination. During the years ended December 31, 2018 , 2017 and 2016 , no subordinated performance fees were incurred related to any such events. The Company incurred commissions, fees and expense reimbursements as shown in the table below for services provided by CCI III Management and its affiliates related to the services described above during the periods indicated: Year Ended December 31, 2018 2017 2016 Selling commissions $ 540,706 $ 798,184 $ 15,500 Dealer manager fees $ 206,689 $ 331,799 $ 13,468 Distribution and stockholder servicing fees (1) $ 65,165 $ 21,753 $ 16 Organization and offering costs $ 109,044 $ 169,994 $ 31,962 Acquisition fees and expenses $ — $ 330,000 $ 665,090 Advisory fees $ — $ 60,565 $ 74,289 Operating expenses $ — $ 50,000 $ 107,429 Financing coordination fees $ — $ 99,750 $ 220,000 ______________________ (1) Amounts are calculated for the respective periods in accordance with the dealer manager agreement and excludes the estimated liability for future distribution and stockholder servicing fees payable to CCO Capital of $188,000 and $217,000 for the years ended December 31, 2018 and 2017 , respectively, which is included in due to affiliates in the consolidated balance sheets with a corresponding decrease to capital in excess of par value, as described in Note 2 — Summary of Significant Accounting Policies. Due to/from Affiliates As of December 31, 2018 and 2017 , $188,000 and $278,000 , respectively, was recorded for services and expenses incurred, but not yet reimbursed to CCI III Management, or its affiliates. The amounts are primarily for future distribution and stockholder servicing fees and for operating expenses. The Company incurred $53,000 and $262,000 , respectively, of interest expense related to the Subordinate Promissory Note during the year ended December 31, 2018 and 2017 , respectively, of which $10,000 in interest had been incurred but not yet paid as of December 31, 2017 . This amount was included in due to affiliates as of December 31, 2017 in the consolidated balance sheet for such period. All interest incurred had been paid as of December 31, 2018 . As of December 31, 2017 , $1,000 was due from CCI III Management or its affiliates related to amounts received by affiliates of the advisor which were due to the Company. No such amounts were due from CCI III Management or its affiliates as of December 31, 2018 . |
ECONOMIC DEPENDENCY
ECONOMIC DEPENDENCY | 12 Months Ended |
Dec. 31, 2018 | |
Economic Dependency [Abstract] | |
ECONOMIC DEPENDENCY | ECONOMIC DEPENDENCY Under various agreements, the Company has engaged and may in the future engage CCI III Management or its affiliates to provide certain services that are essential to the Company, including asset management services, supervision of the management and leasing of properties owned by the Company, asset acquisition and disposition decisions, the sale of shares of the Company’s common stock available for issuance, as well as other administrative responsibilities for the Company including accounting services and stockholder relations. As a result of these relationships, the Company is dependent upon CCI III Management or its affiliates. In the event that these companies are unable to provide the Company with these services, the Company would be required to find alternative providers of these services. Services Agreement VEREIT OP, a former affiliated entity of the Company’s sponsor, is obligated to provide certain services to CCO Group and to the Company, including operational real estate support (the “Services Agreement”) through March 31, 2019 (or, if later, the date of the last government filing other than a tax filing made by us, CCPT IV, CCPT V, CCIT II, and/or CIM Income NAV with respect to its 2018 fiscal year) (the “Initial Services Term”), and is obligated to provide consulting and research services through December 31, 2023 as requested by CCO Group, LLC. The services provided by VEREIT OP during the Initial Services Term, including but not limited to any advisory, dealer manager and property management services, have been, or by March 31, 2019, will be, transitioned to, and will be provided directly by, our sponsor, advisor, dealer manager or an affiliate thereof. |
STOCKHOLDER'S EQUITY
STOCKHOLDER'S EQUITY | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
STOCKHOLDERS' EQUITY | STOCKHOLDERS’ EQUITY As of December 31, 2018 and 2017 , the Company was authorized to issue 490.0 million shares of common stock pursuant to the primary offering, consisting of two classes of shares ( 245.0 million in Class A Shares and 245.0 million in Class T Shares) and 10.0 million shares of preferred stock. All shares of such stock have a par value of $0.01 per share. On July 14, 2014 , VEREIT OP acquired 8,000 shares of common stock, at $25.00 per share. Effective December 30, 2015, the Company effected a stock split, whereby every one share of their common stock issued and outstanding was split into two and one-half shares of common stock, resulting in 20,000 Class A Shares of common stock issued and outstanding. On February 1, 2018, VEREIT OP transferred these 20,000 shares to CCI III Management and pursuant to the Company’s charter, CCI III Management is prohibited from selling the 20,000 shares of the common stock that represents the initial investment in the Company for so long as CCO Group remains the Company’s sponsor; provided, however, that CCI III Management may transfer ownership of all or a portion of these 20,000 shares of the Company’s common stock to other affiliates of the Company’s sponsor. Distribution Reinvestment Plan Pursuant to the DRIP, the Company allows stockholders to elect to have their distributions reinvested in additional shares of the Company’s common stock. Distributions on Class A Shares are reinvested in Class A Shares and distributions on Class T Shares are reinvested in Class T Shares. Prior to February 19, 2019 , the purchase price per share for both Class A Shares and Class T Shares under the DRIP portion of the Offering was $9.10 per share. On February 13, 2019 , the Board established an estimated per share NAV of its common stock as of December 31, 2018 of $8.60 per share for both Class A Shares and Class T Shares. Commencing on February 19, 2019 , distributions will be reinvested in shares of the Company’s common stock pursuant to the DRIP at a price of $8.60 per share for both Class A Shares and Class T Shares, the estimated per share NAV as of December 31, 2018 , as determined by the Board. The Board may terminate or amend the DRIP at the Company’s discretion at any time upon ten days’ prior written notice to the stockholders. During the years ended December 31, 2018 and 2017 , approximately 63,000 and 20,000 shares, respectively, were purchased under the DRIP for $570,000 , and $180,000 , respectively, which were recorded as redeemable common stock on the consolidated balance sheets. During the year ended December 31, 2016 , no shares were purchased under the DRIP. Share Redemption Program The Company’s share redemption program permits its stockholders to sell their shares back to the Company after they have held them for at least one year, subject to the significant conditions and limitations described below. The share redemption program provides that the Company will redeem shares of its common stock from requesting stockholders, subject to the terms and conditions of the share redemption program. The Company will limit the number of shares redeemed pursuant to the share redemption program as follows: (1) the Company will not redeem in excess of 5% of the weighted average number of shares outstanding during the trailing 12 months prior to the end of the fiscal quarter for which the redemptions are being paid; and (2) funding for the redemption of shares will be limited, among other things to the net proceeds the Company receives from the sale of shares under the DRIP, net of shares redeemed to date. In an effort to accommodate redemption requests throughout the calendar year, the Company intends to limit quarterly redemptions to approximately 1.25% of the weighted average number of shares outstanding during the trailing 12-month period ending on the last day of the fiscal quarter, and funding for redemptions for each quarter generally will be limited to the net proceeds the Company receives from the sale of shares in the respective quarter under the DRIP. Except for redemptions due to a stockholder’s death, bankruptcy or other exigent circumstances, the redemption price per share will equal the per share value shown on the stockholder’s most recent customer account statement. The redemption price will be adjusted for any stock dividends, combinations, splits, recapitalizations and the like with respect to the Company’s common stock if any such event is not already reflected in the per share value shown on the stockholder’s most recent customer account statement. As a result of the Board’s determination of an estimated value of the Company’s shares of common stock, the estimated per share NAV of $8.60 for both Class A Shares and Class T Shares, as of December 31, 2018, will serve as the most recent estimated per share NAV for purposes of the share redemption program, effective February 19, 2019 , until such time as the Board determines a new estimated per share NAV. See the discussion of the estimated per share NAV of the Company’s common stock effective February 19, 2019 in Note 14 — Subsequent Events. Upon receipt of a request for redemption, the Company may conduct a Uniform Commercial Code search to ensure that no liens are held against the shares. If the Company cannot purchase all shares presented for redemption in any fiscal quarter, based upon insufficient cash available and/or the limit on the number of shares the Company may redeem during any quarter or year, the Company will give priority to the redemption of deceased stockholders’ shares. The Company next will give priority to requests for full redemption of accounts with a balance of 250 shares or less at the time the Company receives the request, in order to reduce the expense of maintaining small accounts. Thereafter, the Company will honor the remaining quarterly redemption requests on a pro rata basis. Following such quarterly redemption period, the unsatisfied portion of the prior redemption request must be resubmitted, prior to the last day of the new quarter. Unfulfilled requests for redemption will not be carried over automatically to subsequent redemption periods. The Company redeems shares no later than the end of the month following the end of each fiscal quarter. Requests for redemption must be received on or prior to the end of the fiscal quarter in order for the Company to repurchase the shares in the month following the end of that fiscal quarter. The Board may amend, suspend or terminate the share redemption program at any time upon 30 days’ notice to the stockholders. During the year ended December 31, 2018 , the Company redeemed approximately 5,300 shares under the share redemption program for $48,000 . The Company did not redeem any shares during the years ended December 31, 2017 and 2016. Distributions Payable and Distribution Policy The Board authorized a daily distribution, based on 365 days in the calendar year, of $0.001369863 per Class A Share for stockholders of record as of the close of business on each day of the period commencing on April 1, 2019 and ending on June 30, 2019 . The Board authorized a daily distribution on Class T Shares for stockholders of record of such class of shares as of the close of business on each day commencing on April 1, 2019 and ending on June 30, 2019 , equal to $0.001369863 per Class T Share, less the per share distribution and stockholder servicing fees that are payable with respect to the Class T Shares (as calculated on a daily basis). As of December 31, 2018 , the Company had distributions payable of $155,000 . Equity Based Compensation On August 9, 2018, the Board approved the adoption of the Cole Office & Industrial REIT (CCIT III), Inc. 2018 Equity Incentive Plan (the “Plan”), under which 400,000 of the Company’s common shares were reserved for issuance and share awards of 391,000 are available for future grant at December 31, 2018 . Under the Plan, the Board or a committee designated by the Board has the authority to grant restricted stock awards or deferred stock awards to non-employee directors of the Company, which will further align such directors’ interests with the interests of the Company’s stockholders. The Board or committee also has the authority to determine the terms of any award granted pursuant to the Plan, including vesting schedules, restrictions and acceleration of any restrictions. The Plan may be amended or terminated by the Board at any time. The Plan expires on August 8, 2028 . On October 1, 2018, the Company granted awards of approximately 3,000 restricted Class A Shares to each of the independent members of the Board (approximately 9,000 restricted shares in aggregate) under the Plan, which fully vest on October 1, 2019 based on one year of continuous service. As of December 31, 2018 , none of the restricted Class A Shares had vested or been forfeited. The fair value of the Company’s share awards is determined using the Company’s NAV per share on the date of grant. Compensation expense related to these restricted Class A Shares is recognized over the vesting period. The Company recorded compensation expense of $21,000 for the year ended December 31, 2018 related to these restricted Class A Shares included in general and administrative expenses on the accompanying consolidated statements of operations. As of December 31, 2018 , there was $62,000 of total unrecognized compensation expense related to these restricted Class A Shares, which will be recognized ratably over the remaining period of service prior to October 1, 2019. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES For federal income tax purposes, distributions to stockholders are characterized as ordinary dividends, capital gain distributions, or nondividend distributions. Nondividend distributions will reduce U.S stockholders’ basis (but not below zero) in their shares. The following table shows the character of the distributions the Company paid on a percentage basis for the years ended December 31, 2018 , 2017 and 2016 : Year Ended December 31, Character of Distributions: 2018 2017 2016 Ordinary dividends — % — % — % Nondividend distributions 100 % 100 % 100 % Total 100 % 100 % 100 % During the year ended December 31, 2017, the Company distributed as dividends to its stockholders 100% of its taxable income for federal income tax purposes. Accordingly, no provision for federal income taxes related to such taxable income was recorded in the Company’s consolidated financial statements. During the years ended December 31, 2018 , 2017 and 2016 , the Company incurred state and local income and franchise taxes of $6,500 , $2,500 and $300 , respectively, which were recorded in general and administrative expenses on the consolidated statement of operations. For its taxable year ended December 31, 2016, the Company was taxed as a C corporation under the Internal Revenue Code, as it did not meet all of the criteria to qualify as a REIT during this period. As such, the Company was subject to regular corporate income taxes on its taxable income for such period. The Company did not pay any income tax for the taxable year ended December 31, 2016 because it incurred a net operating loss for such year. However, the income tax benefit from such net operating loss was offset by a full valuation allowance of approximately $496,000 against the net deferred tax assets as of December 31, 2016 because the Company intended to qualify as a REIT for the taxable years ending on or after December 31, 2017, and did not expect to utilize its net operating loss carryforward. As a result, no provision or benefit for income taxes was recognized in the accompanying financial statements. The Company calculated its estimated annualized effective tax expense rate at 0% for the year ended December 31, 2016. Deferred tax assets (liabilities) consisted of the following components as of the period indicated: Year Ended December 31, 2016 Fixed assets $ 337,888 Net operating loss 109,072 Deferred rent 72,948 Other (23,561 ) Valuation allowance (496,347 ) Total net deferred tax asset $ — The following is a reconciliation of benefit from income taxes with the amount computed by applying the statutory federal income tax rate to loss before income taxes for the period indicated: Year Ended December 31, 2016 Net loss $ (1,392,279 ) Federal provision (benefit) at statutory rate (487,297 ) State and local provision at statutory rate (9,050 ) Change in valuation allowance against net deferred tax assets 496,347 Total benefit from income taxes $ — As of December 31, 2016, the Company had federal net operating loss carryforwards of approximately $303,000 and $306,000 . As the Company qualified as a REIT commencing with its taxable year ended December 31, 2017 , the Company did not utilize its net operating loss carryforwards, and a full valuation allowance was placed against the deferred tax assets related to these carryforwards. The Company had no unrecognized tax benefits as of or during the year ended December 31, 2018 , 2017 and 2016 . Any interest and penalties related to unrecognized tax benefits would be recognized within the provision for income taxes in the Company’s consolidated statements of operations. The Company files income tax returns in the U.S. federal jurisdiction, as well as various state and local jurisdictions, and is subject to routine examinations by the respective tax authorities. |
OPERATING LEASES
OPERATING LEASES | 12 Months Ended |
Dec. 31, 2018 | |
Leases [Abstract] | |
OPERATING LEASES | OPERATING LEASES The Company’s real estate assets are leased to tenants under operating leases for which the terms and expirations vary. As of December 31, 2018 , the leases had a remaining weighted-average lease term of 9.7 years . The leases include provisions to extend the lease term, options for early termination after paying a specified penalty, rights of first refusal to purchase the property at competitive market rates, and other negotiated terms and conditions. The Company retains substantially all of the risks and benefits of ownership of the real estate assets leased to the tenants. The future minimum rental income from the Company’s real estate assets under the non-cancelable operating leases, assuming no exercise of renewal options, as of December 31, 2018 , was as follows: Year Ending December 31, Future Minimum Rental Income 2019 $ 3,808,708 2020 3,878,462 2021 3,756,969 2022 3,829,450 2023 3,903,333 Thereafter 18,881,112 Total $ 38,058,034 |
QUARTERLY RESULTS (UNAUDITED)
QUARTERLY RESULTS (UNAUDITED) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
QUARTERLY RESULTS (UNAUDITED) | QUARTERLY RESULTS (UNAUDITED) Presented below is a summary of the unaudited quarterly financial information for the years ended December 31, 2018 and 2017 . In the opinion of management, the information for the interim periods presented includes all adjustments, which are of a normal and recurring nature, necessary to present a fair presentation of the results for each period. December 31, 2018 First Quarter Second Quarter Third Quarter Fourth Quarter Revenues $ 1,101,694 $ 1,101,667 $ 1,101,666 $ 1,101,348 Net loss $ (192,338 ) $ (206,504 ) $ (183,344 ) $ (189,526 ) Basic and diluted net loss per share - Class A common stock (1) $ (0.08 ) $ (0.08 ) $ (0.06 ) $ (0.06 ) Basic and diluted net loss per share - Class T common stock (1) $ (0.10 ) $ (0.10 ) $ (0.08 ) $ (0.08 ) ____________________________________ (1) The Company calculates net loss per share based on the weighted-average number of outstanding shares of common stock during the reporting period. The average number of shares fluctuates throughout the year and can therefore produce a full year result that does not agree to the sum of the individual quarters. December 31, 2017 First Quarter Second Quarter Third Quarter Fourth Quarter Revenues $ 744,504 $ 739,749 $ 1,581,290 $ 1,039,054 Net loss $ (327,144 ) $ (228,657 ) $ (135,116 ) $ (431,078 ) Basic and diluted net loss per share - Class A common stock (1) $ (0.66 ) $ (0.23 ) $ (0.09 ) $ (0.21 ) Basic and diluted net loss per share - Class T common stock (1) $ (0.68 ) $ (0.26 ) $ (0.11 ) $ (0.24 ) ____________________________________ (1) The Company calculates net loss per share based on the weighted-average number of outstanding shares of common stock during the reporting period. The average number of shares fluctuates throughout the year and can therefore produce a full year result that does not agree to the sum of the individual quarters. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2018 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS The following events occurred subsequent to December 31, 2018 : Redemption of Shares of Common Stock Subsequent to December 31, 2018 , the Company redeemed approximately 5,400 shares pursuant to the Company’s share redemption program for $49,000 (at an average price per share of $9.00 ). Credit Facility Subsequent to December 31, 2018 , the Company reduced the borrowing commitment on its Credit Facility from $100.0 million to $35.0 million . Estimated Per Share NAV On February 13, 2019 , the Board established an estimated per share NAV of the Company’s common stock as of December 31, 2018 , of $8.60 per share for both Class A Shares and Class T Shares. Commencing on February 19, 2019 , distributions will be reinvested in shares of the Company’s common stock under the DRIP at a price of $8.60 per share for both Class A Shares and Class T Shares. Distributions on Class A Shares are reinvested in Class A Shares and distributions on Class T Shares are reinvested in Class T Shares. Pursuant to the terms of the Company’s share redemption program, commencing on February 19, 2019 , the estimated per share NAV of $8.60 for both Class A Shares and Class T Shares, as of December 31, 2018 , will serve as the most recent estimated value for purposes of the share redemption program, until such time as the Board determines a new estimated per share NAV. CCI III Management Expense Reimbursement The Company reimburses CCI III Management or its affiliates for the operating expenses they paid or incurred in connection with advisory and administrative services provided to the Company, subject to the limitation that the Company will not reimburse CCI III Management or its affiliates for any amount by which the operating expenses (including the advisory fee) at the end of the four preceding fiscal quarters exceed the greater of (i) 2.0% of average invested assets, or (ii) 25.0% of net income, excluding any additions to reserves for depreciation, bad debts or other similar non-cash reserves and excluding any gain from the sale of assets for that period. As of December 31, 2018 , $576,000 of advisory fees exceeded such expense limit. Subsequent to December 31, 2018 , CCI III Management waived its right to receive these amounts for the years ended December 31, 2018 , 2017 and 2016. Accordingly, the Company did not reimburse CCI III Management for any such expenses for the years ended December 31, 2018 , 2017 and 2016. Additionally, CCI III Management waived its right to receive a monthly advisory fee during the year ended December 31, 2019. |
Schedule III - Real Estate Asse
Schedule III - Real Estate Assets And Accumulated Depreciation | 12 Months Ended |
Dec. 31, 2018 | |
SEC Schedule, 12-28, Real Estate Companies, Investment in Real Estate and Accumulated Depreciation Disclosure [Abstract] | |
SCHEDULE III - REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION | SCHEDULE III — REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION Gross Amount at Initial Costs to Company Total Which Carried Accumulated Buildings & Adjustment At December 31, 2018 Depreciation Date Date Description (a) Encumbrances Land Improvements to Basis (b) (c) (d) (e) (f) Acquired Constructed Real Estate Held for Investment: Siemens Milford, OH (g) $ 2,307,312 $ 26,971,327 $ — $ 29,278,639 $ 2,454,180 9/23/2016 1991 Actuant Columbus, WI (g) 937,691 14,287,443 — 15,225,134 425,566 11/6/2017 2014 TOTAL: $ — $ 3,245,003 $ 41,258,770 $ — $ 44,503,773 $ 2,879,746 ____________________________________ (a) As of December 31, 2018 , the Company owned one office property and one industrial property. (b) Gross intangible lease assets of $5.1 million and the associated accumulated amortization of $944,000 are not reflected in the table above. (c) The aggregate cost for federal income tax purposes was $50.4 million . (d) The following is a reconciliation of total real estate carrying value for the years ended December 31, 2018 and 2017 : Year Ended December 31, 2018 2017 2016 Balance, beginning of period $ 44,503,773 $ 29,278,639 $ — Additions Acquisitions — 15,225,134 29,278,639 Improvements — — — Total additions — 15,225,134 29,278,639 Deductions — — — Cost of real estate sold — — — Total deductions — — — Balance, end of period $ 44,503,773 $ 44,503,773 $ 29,278,639 (e) The following is a reconciliation of accumulated depreciation for the years ended December 31, 2018 and 2017 : Year Ended December 31, 2018 2017 2016 Balance, beginning of period $ 1,430,550 $ 312,350 $ — Additions Acquisitions - Depreciation Expense for Building & Tenant Improvements Acquired 1,449,196 1,118,200 312,350 Improvements - Depreciation Expense for Tenant Improvements & Building Equipment — — — Total additions 1,449,196 1,118,200 312,350 Deductions — — — Cost of real estate sold — — — Total deductions — — — Balance, end of period $ 2,879,746 $ 1,430,550 $ 312,350 (f) The Company’s assets are depreciated or amortized using the straight-line method over the useful lives of the assets by class. Generally, buildings are depreciated over 40 years, site improvements are amortized over 15 years, and tenant improvements are amortized over the remaining life of the lease or the useful life, whichever is shorter. (g) Part of the Credit Facility’s unencumbered borrowing base. As of December 31, 2018 , the Company had $24.2 million outstanding under the Credit Facility. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | The summary of significant accounting policies presented below is designed to assist in understanding the Company’s consolidated financial statements. These accounting policies conform to accounting principles generally accepted in the United States of America (“GAAP”) in all material respects, and have been consistently applied in preparing the accompanying consolidated financial statements. |
Principles of Consolidation | Principles of Consolidation and Basis of Presentation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Real Estate Assets, Recoverability of Real Estate Assets, and Assets Held for Sale | Real Estate Assets Real estate assets are stated at cost, less accumulated depreciation and amortization. The Company considers the period of future benefit of each respective asset to determine the appropriate useful life. The estimated useful lives of the Company’s real estate assets by class are generally as follows: Buildings 40 years Site improvements 15 years Tenant improvements Lesser of useful life or lease term Intangible lease assets Lease term Recoverability of Real Estate Assets The Company continually monitors events and changes in circumstances that could indicate that the carrying amounts of its real estate assets may not be recoverable. Impairment indicators that the Company considers include, but are not limited to: bankruptcy or other credit concerns of a property’s major tenant, such as a history of late payments, rental concessions and other factors; a significant decrease in a property’s revenues due to lease terminations; vacancies; co-tenancy clauses; reduced lease rates; changes in anticipated holding periods; or other circumstances. When indicators of potential impairment are present, the Company assesses the recoverability of the assets by determining whether the carrying amount of the assets will be recovered through the undiscounted future cash flows expected from the use of the assets and their eventual disposition. In the event that such expected undiscounted future cash flows do not exceed the carrying amount, the Company will adjust the real estate assets to their respective fair values and recognize an impairment loss. Generally, fair value will be determined using a discounted cash flow analysis and recent comparable sales transactions . No impairment indicators were identified and no impairment losses were recorded during the years ended December 31, 2018 , 2017 or 2016 . Assets Held for Sale When a real estate asset is identified by the Company as held for sale, the Company will cease recording depreciation and amortization of the assets related to the property and estimate its fair value, net of selling costs. If, in management’s opinion, the fair value, net of selling costs, of the asset is less than the carrying amount of the asset, an adjustment to the carrying amount is then recorded to reflect the estimated fair value of the property, net of selling costs. |
Allocation of Purchase Price of Real Estate Assets | Allocation of Purchase Price of Real Estate Assets Upon the acquisition of real properties, the Company allocates the purchase price to acquired tangible assets, consisting of land, buildings and improvements, and to identified intangible assets and liabilities, consisting of the value of above- and below-market leases and the value of in-place leases and other intangibles, based in each case on their respective fair values. The Company utilizes independent appraisals to assist in the determination of the fair values of the tangible assets of an acquired property (which includes land and buildings). The information in the appraisal, along with any additional information available to the Company’s management, is used in estimating the amount of the purchase price that is allocated to land. Other information in the appraisal, such as building value and market rents, may be used by the Company’s management in estimating the allocation of purchase price to the building and to intangible lease assets and liabilities. The appraisal firm has no involvement in management’s allocation decisions other than providing this market information. The fair values of above- and below-market lease intangibles are recorded based on the present value (using a discount rate which reflects the risks associated with the leases acquired) of the difference between (1) the contractual amounts to be paid pursuant to the in-place leases and (2) an estimate of fair market lease rates for the corresponding in-place leases, which is generally obtained from independent appraisals, measured over a period equal to the remaining non-cancelable term of the lease including, for below-market leases, any bargain renewal periods. The above- and below-market lease intangibles are capitalized as intangible lease assets or liabilities, respectively. Above-market leases are amortized as a reduction to rental income over the remaining terms of the respective leases. Below-market leases are amortized as an increase to rental income over the remaining terms of the respective leases, including any bargain renewal periods. In considering whether or not the Company expects a tenant to execute a bargain renewal option, the Company evaluates economic factors and certain qualitative factors at the time of acquisition, such as the financial strength of the tenant, the remaining lease term, the tenant mix of the leased property, the Company’s relationship with the tenant and the availability of competing tenant space. If a lease were to be terminated prior to its stated expiration, all unamortized amounts of above- or below-market lease intangibles relating to that lease would be recorded as an adjustment to rental income. The fair values of in-place leases include estimates of direct costs associated with obtaining a new tenant and opportunity costs associated with lost rental and other property income which are avoided by acquiring a property with an in-place lease. Direct costs associated with obtaining a new tenant include leasing commissions, legal and other related expenses, and are estimated in part by utilizing information obtained from independent appraisals and management’s consideration of current market costs to execute a similar lease. The intangible values of opportunity costs, which are calculated using the contractual amounts to be paid pursuant to the in-place leases over a market absorption period for a similar lease, are capitalized as intangible lease assets and are amortized to expense over the remaining term 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. The Company may acquire certain properties subject to contingent consideration arrangements that may obligate the Company to pay additional consideration to the seller based on the outcome of future events. Additionally, the Company may acquire certain properties for which it funds certain contingent consideration amounts into an escrow account pending the outcome of certain future events. The outcome may result in the release of all or a portion of the escrow funds to the Company or the seller or a combination thereof. Upon adoption of ASU 2017-01 (as defined below) in April 2017, contingent consideration arrangements for asset acquisitions are recognized when the contingency is resolved. The determination of the amount of contingent consideration arrangements is based on the probability of several possible outcomes as identified by management. The Company estimates the fair value of assumed mortgage notes payable based upon indications of current market pricing for similar types of debt financing with similar maturities. Assumed mortgage notes payable are initially recorded at their estimated fair value as of the assumption date, and any difference between such estimated fair value and the mortgage note’s outstanding principal balance is amortized or accreted to interest expense over the term of the respective mortgage note payable. The determination of the fair values of the real estate assets and liabilities acquired requires the use of significant assumptions with regard to the current market rental rates, rental growth rates, capitalization and discount rates, interest rates and other variables. The use of alternative estimates may result in a different allocation of the Company’s purchase price, which could materially impact the Company’s results of operations. In April 2017, the Company elected to early adopt Accounting Standards Update (“ASU”) No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business (“ASU 2017-01”), which clarifies the definition of a business by adding guidance to assist entities in evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. Beginning in April 2017, all real estate acquisitions qualified as asset acquisitions, and as such, acquisition-related fees and certain acquisition-related expenses related to these asset acquisitions are now capitalized and allocated to tangible and intangible assets and liabilities as described above. Other acquisition-related expenses, such as advisor reimbursements, continue to be expensed as incurred and are included in transaction-related expenses on the accompanying consolidated statements of operations. Prior to the adoption of ASU 2017-01 in April 2017, all of the Company’s real estate acquisitions were accounted for as business combinations, and as such, acquisition-related expenses related to these business combination acquisitions were expensed as incurred. Prior to April 2017, acquisition-related expenses included within transaction-related expenses in the Company’s consolidated statements of operations primarily consisted of legal, deed transfer and other costs related to real estate purchase transactions, including costs incurred for deals that were not consummated. The Company expects any future acquisitions to qualify as asset acquisitions and, as such, the Company will allocate the purchase price to acquired tangible assets and identified intangible assets and liabilities on a relative fair value basis. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents includes cash in bank accounts. The Company deposits cash with several high quality financial institutions. These deposits are guaranteed by the Federal Deposit Insurance Company (“FDIC”) up to an insurance limit of $250,000. At times, the Company’s cash and cash equivalents may exceed federally insured levels. Although the Company bears risk on amounts in excess of those insured by the FDIC, it has not experienced and does not anticipate any losses due to the high quality of the institutions where the deposits are held. |
Deferred Financing Costs | Deferred Financing Costs Deferred financing costs represent commitment fees, legal fees and other costs associated with obtaining commitments for financing. The presentation of all deferred financing costs, other than those associated with the revolving loan portion of the credit facility, are classified such that the debt issuance costs related to a recognized debt liability are presented on the consolidated balance sheets as a direct deduction from the carrying amount of the related debt liability rather than as an asset. Debt issuance costs related to securing the Company’s revolving line of credit are presented as an asset and amortized ratably over the term of the line of credit arrangement. The Company’s total deferred costs, net in the accompanying consolidated balance sheets relate only to the revolving loan portion of the Credit Facility (as defined in Note 6 — Credit Facility and Subordinate Promissory Note). As of December 31, 2018 and 2017 , the Company had $407,000 and $1.0 million , respectively, of deferred financing costs, net of accumulated amortization, related to the revolving loan portion of the Credit Facility. Costs incurred in seeking financing transactions that do not close are expensed in the period in which it is determined the financing will not close. |
Distribution and Stockholder Servicing Fees | Distribution and Stockholder Servicing Fees The Company pays CCO Capital a distribution and stockholder servicing fee for Class T Shares sold in the primary portion of the Offering which, prior to the Board’s determination of the estimated per share NAV, was calculated on a daily basis in the amount of 1/365th of 1.0% of the purchase price per share of Class T Shares sold in the primary portion of the Offering. Commencing on February 19, 2019 , the distribution and stockholder servicing fee for Class T Shares is calculated on a daily basis in an amount equal to 1/365th of 1.0% of the per share NAV. The aggregate distribution and stockholder servicing fee for Class T Shares will not exceed an amount equal to 4.0% of the total gross offering proceeds of Class T Shares sold in the primary portion of the Offering. The Company will cease paying the distribution and stockholder servicing fee with respect to Class T Shares sold in the Offering at the earliest of: (i) the end of the month in which the transfer agent, on the Company’s behalf, determines that total selling commissions and distribution and stockholder servicing fees paid by a stockholder within his or her individual account would be equal to 4.0% of the stockholder’s total gross investment amount at the time of the purchase of the primary Class T Shares held in such account, or a lower limit agreed upon between the Company’s dealer manager and the participating broker-dealer at the time such Class T Shares were sold; (ii) the date on which the aggregate underwriting compensation from all sources equals 10.0% of the gross offering proceeds (i.e., excluding proceeds from sales pursuant to the DRIP); (iii) the fourth anniversary of the last day of the month in which the Offering (excluding the offering of shares pursuant to the DRIP) terminates; (iv) the date such Class T Share is no longer outstanding; and (v) the date the Company effects a liquidity event (such as the sale of the Company, the sale of all or substantially all of the Company’s assets, a merger or similar transaction, the listing of the Company’s shares of common stock for trading on a national securities exchange or an alternative strategy that would result in a significant increase in the opportunities for stockholders to dispose of their shares). CCO Capital may, in its discretion, reallow to participating broker-dealers all or a portion of the distribution and stockholder servicing fee. At the time the Company ceases paying the distribution and stockholder servicing fee with respect to an outstanding Class T Share pursuant to the provisions above, such Class T Share will convert into a number of Class A Shares (including any fractional shares) with an equivalent net asset value as such share. The distribution and stockholder servicing fee is paid monthly in arrears. An estimated liability for future distribution and stockholder servicing fees payable to CCO Capital is recognized at the time each Class T Share is sold and included in due to affiliates in the consolidated balance sheets with a corresponding decrease to capital in excess of par value. |
Due to Affiliates | Due to Affiliates Certain affiliates of CCI III Management received, and will continue to receive, fees, reimbursements and compensation in connection with services provided relating to the Offering and the acquisition, management, financing and leasing of the Company’s assets. As of December 31, 2018 and 2017 , $188,000 and $278,000 , respectively, was due to CCI III Management and its affiliates for such services, as discussed in Note 8 — Related-Party Transactions and Arrangements to these consolidated financial statements. |
Redeemable Common Stock | Redeemable Common Stock Under the Company’s share redemption program, the Company’s obligation to redeem shares of its outstanding common stock is limited, among other things, to the net proceeds received by the Company from the sale of shares under the DRIP during the quarter, net of shares redeemed. The Company records the maximum amount that is redeemable under the share redemption program as redeemable common stock outside of permanent equity in its consolidated balance sheets. Changes in the amount of redeemable common stock from period to period are recorded as an adjustment to capital in excess of par value. |
Revenue Recognition | Revenue Recognition Certain properties have leases where the minimum rental payment increases during the term of the lease. The Company records rental income for the full term of each lease on a straight-line basis when earned and collectability is reasonably assured. When the Company acquires a property, the terms of existing leases are considered to commence as of the acquisition date for the purpose of this calculation. The Company defers the recognition of contingent rental income, such as percentage rents, until the specific target that triggers the contingent rental income is achieved. Expected reimbursements from tenants for recoverable real estate taxes and operating expenses are included in tenant reimbursement income in the period when such costs are incurred. Effective January 1, 2018, the Company adopted ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”), which supersedes the revenue recognition requirements in Revenue Recognition, Accounting Standards Codification Topic 605 and requires an entity to recognize revenue in a way that depicts the transfer of promised goods or 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 Company records revenue for real estate taxes and insurance reimbursed by its tenants on the leased properties, with offsetting expenses in real estate taxes and property operating expenses, respectively, within the consolidated statements of operations as the Company has concluded it is the primary obligor. The Company has identified its revenue streams as rental income from leasing arrangements and tenant reimbursement income, which are outside of the scope of Topic 606. The Company adopted ASU 2014-09 using the modified retrospective approach and determined it did not have a material impact on the Company’s consolidated financial statements. The Company continually reviews receivables related to rent, including any straight-line rent, and current and future operating expense reimbursements from tenants and determines their collectability by taking into consideration the tenant’s payment history, the financial condition of the tenant, business conditions in the industry in which the tenant operates and economic conditions in the area in which the property is located. In the event that the collectability of a receivable is uncertain, the Company will record an increase in the allowance for uncollectible accounts. |
Income Taxes | Income Taxes The Company elected to be taxed and qualified as a REIT for federal income tax purposes under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended, (the “Internal Revenue Code”), beginning with its taxable year ended December 31, 2017. The Company will generally not be subject to federal corporate income tax to the extent it distributes its taxable income to its stockholders, and so long as it, among other things, distributes at least 90% of its annual taxable income (computed without regard to the dividends paid deduction and excluding net capital gains). REITs are subject to a number of other organizational and operational requirements. Even if the Company maintains its qualification for taxation as a REIT, it or its subsidiaries may be subject to certain state and local taxes on its income and property, and federal income and excise taxes on its undistributed income. For the period from May 22, 2014 (date of inception) to December 31, 2016, the Company did not meet all of the criteria to qualify as a REIT under the Internal Revenue Code. Specifically, the Company did not have enough stockholders for a sufficient number of days in 2016. As such, the Company was taxable as a C Corporation for the taxable year ended December 31, 2016, and was subject to regular taxes on its income for such period. However, the Company incurred a taxable loss for the period ending December 31, 2016, and as such, there was no federal income tax liability for this period. |
Net Loss and Distributions Per Share | Net Loss and Distributions Per Share The Company has two classes of common stock. Accordingly, the Company utilizes the two-class method to determine its earnings per share, which results in different earnings per share for each of the classes. Under the two-class method, earnings per share of each class of common stock are computed by dividing the sum of the distributed earnings to common stockholders and undistributed earnings allocated to common stockholders by the weighted average number of shares for each class of common stock for the respective period. The distributed earnings to Class T Share common stockholders represents distributions declared less the distribution and stockholder servicing fees paid with respect to Class T Shares sold in the primary portion of the Offering. Diluted income per share, when applicable, considers the effect of any potentially dilutive share equivalents, of which the Company had none for each of the years ended December 31, 2018 , 2017 or 2016 . Distributions per share are calculated based on the authorized daily distribution rate. |
Offering and Related Costs | Offering and Related Costs CCI III Management funds all of the organization and offering costs on the Company’s behalf (excluding selling commissions, dealer manager fees and distribution and stockholder servicing fees) and may be reimbursed for such costs up to 1.0% of the gross proceeds from the Offering. As of December 31, 2018 , CCI III Management had paid organization and offering costs in excess of 1.0% of the gross proceeds from the Offering. These excess costs were not included in the financial statements of the Company because such costs were not a liability of the Company as they exceeded 1.0% of the aggregate gross proceeds from the Offering. The Company expenses organization costs as incurred and records offering costs, which include items such as legal and accounting fees, marketing, personnel, promotional and printing costs, as a reduction of capital in excess of par value along with selling commissions, and dealer manager fees in the period in which they become payable. |
Reportable Segment | Reportable Segment The Company’s commercial real estate assets consist primarily of single-tenant, income-producing necessity office and industrial properties, which are leased to creditworthy tenants under a long-term net leases. The commercial properties are geographically diversified throughout the United States and have similar economic characteristics. The Company’s management evaluates operating performance on an overall portfolio level; therefore, the Company’s properties are one reportable segment. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements From time to time, new accounting pronouncements are issued by various standard setting bodies that may have an impact on the Company’s accounting and reporting. Except as otherwise stated below, the Company is currently evaluating the effect that certain new accounting requirements may have on the Company’s accounting and related reporting and disclosures in the Company’s consolidated financial statements: In February 2016, the Financial Accounting Standards Board (the “FASB”) issued ASU No. 2016-02, Leases (Topic 842) (“ASU 2016-02”). The amendments in this update require that most lease obligations be recognized as a right of use asset with a corresponding liability on the balance sheet. The guidance also requires additional qualitative and quantitative disclosures to assess the amount, timing and uncertainty of cash flows arising from leases. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with early adoption permitted. The FASB has subsequently issued other related ASU, which amend ASU 2016-02 to provide transition practical expedients that an entity may elect to apply and other guidance. In July 2018, the FASB issued ASU No. 2018-11, Leases: Targeted Improvements, which provides companies with an additional transition option that would permit the application of ASU 2016-02 as of the adoption date rather than to all periods presented. The Company will use this transition option upon adoption of the new standard on January 1, 2019 and use the effective date as the date of initial application. Consequently, financial information will not be updated and the disclosures required under the new standard will not be provided for dates and periods before January 1, 2019. The Company adopted the guidance on January 1, 2019 using the modified retrospective approach. The Company has finalized its assessment of its inventory of leases that will be impacted by adoption of the new guidance. The Company will elect the “package of practical expedients,” which permits the Company to not reassess under the new standard prior conclusions about lease identification, lease classification and initial direct costs. The accounting for lease components will largely be unchanged from existing GAAP and the Company will elect the practical expedient to not separate non-lease components from lease components. The Company does not expect the adoption of ASU 2016-02 to have a material impact on the accounting treatment and disclosure of the Company’s net leases, which are the primary source of the Company’s revenues. The Company does not have material leases where it is the lessee. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326) (“ASU 2016-13”). ASU 2016-13 is intended to improve financial reporting requiring more timely recognition of credit losses on loans and other financial instruments that are not accounted for at fair value through net income, including loans held for investment, held-to-maturity debt securities, trade and other receivables, net investment in leases and other such commitments. ASU 2016-13 requires that financial assets measured at amortized cost be presented at the net amount expected to be collected, through an allowance for credit losses that is deducted from the amortized cost basis. The amendments in ASU 2016-13 require the Company to measure all expected credit losses based upon historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the financial assets and eliminates the “incurred loss” methodology under current GAAP. ASU 2016-13 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2019. Early adoption is permitted for fiscal years, and interim periods within those years, beginning after December 15, 2018. The Company is currently evaluating the impact this amendment will have on its consolidated financial statements. In August 2018, the FASB issued ASU No. 2018-13, Changes to the Disclosure Requirements for Fair Value Measurement (“ASU 2018-13”). This ASU amends and removes several disclosure requirements including the valuation processes for Level 3 fair value measurements. ASU 2018-13 also modifies some disclosure requirements and requires additional disclosures for changes in unrealized gains and losses included in other comprehensive income for recurring Level 3 fair value measurements and requires the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. The provisions of ASU 2018-13 are effective January 1, 2020 using a prospective transition method for amendments effecting changes in unrealized gains and losses, significant unobservable inputs used to develop Level 3 fair value measurements and narrative description on uncertainty of measurements. The remaining provisions of the ASU are to be applied retrospectively, and early adoption is permitted. The Company is evaluating the impact of this ASU’s adoption, and does not believe this ASU will have a material impact on its consolidated financial statements. |
Fair Value Measurement | Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions. Depending on the nature of the asset or liability, various techniques and assumptions can be used to estimate the fair value. Assets and liabilities are measured using inputs from three levels of the fair value hierarchy, as follows: Level 1 — Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. An active market is defined as a market in which transactions for the assets or liabilities occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2 — Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active (markets with few transactions), inputs other than quoted prices that are observable for the asset or liability (i.e., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data correlation or other means (market corroborated inputs). Level 3 — Unobservable inputs, which are only used to the extent that observable inputs are not available, reflect the Company’s assumptions about the pricing of an asset or liability. |
Fair Value of Financial Instruments | The following describes the methods the Company uses to estimate the fair value of the Company’s financial assets and liabilities: Credit facility and subordinate promissory note — The fair value is estimated by discounting the expected cash flows based on estimated borrowing rates available to the Company as of the measurement date. These financial instruments are valued using Level 2 inputs. As of December 31, 2018 , the estimated fair value of the Company’s debt was $24.3 million , compared to a carrying value of $24.2 million . As of December 31, 2017 , the estimated fair value of the Company’s debt was $33.8 million , compared to a carrying value of $33.6 million . The carrying and fair values exclude net deferred financing costs. Other financial instruments — The Company considers the carrying values of its cash and cash equivalents, tenant receivables, accrued expenses and accounts payable, other liabilities, due to affiliates and distributions payable to approximate their fair values because of the short period of time between their origination and their expected realization as well as their highly-liquid nature. Due to the short-term maturities of these instruments, Level 1 inputs are utilized to estimate the fair value of these financial instruments. Considerable judgment is necessary to develop estimated fair values of financial assets and liabilities. Accordingly, the estimates presented herein are not necessarily indicative of the amounts the Company could realize, or be liable for, on disposition of the financial assets and liabilities. |
Environmental Matters | Environmental Matters In connection with the ownership and operation of real estate, the Company may potentially be liable for costs and damages related to environmental matters. In addition, the Company may own or acquire certain properties that are subject to environmental remediation. Generally, the seller of the property, the tenant of the property and/or another third party is responsible for environmental remediation costs related to a property. Additionally, in connection with the purchase of certain properties, the respective sellers and/or tenants may agree to indemnify the Company against future remediation costs. The Company also carries environmental liability insurance on its properties that provides limited coverage for any remediation liability and/or pollution liability for third-party bodily injury and/or property damage claims for which the Company may be liable. The Company is not aware of any environmental matters which it believes are reasonably likely to have a material effect on its results of operations, financial condition or liquidity. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Investment in and valuation of real estate | The estimated useful lives of the Company’s real estate assets by class are generally as follows: Buildings 40 years Site improvements 15 years Tenant improvements Lesser of useful life or lease term Intangible lease assets Lease term |
REAL ESTATE ASSET (Tables)
REAL ESTATE ASSET (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Real Estate [Abstract] | |
Schedule of purchase price allocation | The Company allocated the purchase price of this property to the fair value of the assets acquired. The following table summarizes the purchase price allocation for the 2017 Acquisition: December 31, 2017 Land $ 937,691 Buildings and improvements 14,287,443 Acquired in-place lease (1) 1,630,071 Total purchase price $ 16,855,205 ______________________ (1) The weighted average amortization period for the acquired in-place lease was 16.2 years for the 2017 Acquisition. The Company allocated the purchase price of this property to the fair value of the assets acquired. The following table summarizes the purchase price allocation for the 2016 Acquisition: December 31, 2016 Land $ 2,307,312 Buildings and improvements 26,971,327 Acquired in-place lease (1) 3,471,361 Total purchase price $ 32,750,000 ______________________ (1) The weighted average amortization period for the acquired in-place lease was 9.6 years for the 2016 Acquisition. |
Business acquisition, pro forma information | The following table summarizes selected financial information of the Company as if the 2016 Acquisition was completed on January 1, 2015. The table below presents the Company’s estimated revenue and net loss, on a pro forma basis, for the years ended December 31, 2016 and 2015: Year Ended December 31, 2016 2015 Pro forma basis (unaudited): Revenue $ 2,922,263 $ 2,922,263 Net loss $ (1,612,080 ) $ (1,418,625 ) |
INTANGIBLE LEASE ASSETS (Tables
INTANGIBLE LEASE ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of finite-lived intangible asset | The Company’s intangible lease assets consisted of the following as of December 31, 2018 and 2017 : As of December 31, 2018 2017 In-place leases, net of accumulated amortization of $943,541 and $480,483, respectively (with a weighted average life remaining of 9.8 years and 10.8 years, respectively) $ 4,157,891 $ 4,620,949 |
Schedule of finite-lived intangible assets amortization expense | The following table summarizes the amortization expense related to the in-place lease assets for the years ended December 31, 2018 , 2017 and 2016 : Year Ended December 31, 2018 2017 2016 In-place lease amortization $ 463,058 $ 374,832 $ 105,651 |
Schedule of finite-lived intangible assets, future amortization expense | As of December 31, 2018 , the estimated amortization expense relating to the intangible lease assets for each of the five succeeding fiscal years is as follows: Amortization Expense Year ending December 31, In-Place Leases 2019 $ 463,058 2020 $ 463,058 2021 $ 463,058 2022 $ 463,058 2023 $ 463,058 |
CREDIT FACILITY AND SUBORDINA_2
CREDIT FACILITY AND SUBORDINATE PROMISSORY NOTE (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of debt | The following table summarizes the debt balances as of December 31, 2018 and 2017, respectively, and the debt activity for the year ended December 31, 2018 : During the Year Ended December 31, 2018 Balance as of Debt Issuance Repayments Accretion Balance as of Credit facility $ 31,975,000 $ — $ (7,800,000 ) $ — $ 24,175,000 Subordinate promissory note 1,600,000 2,200,000 (3,800,000 ) — — Total debt $ 33,575,000 $ 2,200,000 $ (11,600,000 ) $ — $ 24,175,000 |
Schedule of aggregate principal repayments | The following table summarizes the scheduled aggregate principal repayments for the Company’s outstanding debt as of December 31, 2018 for each of the five succeeding fiscal years and the period thereafter: Principal Repayments 2019 $ 24,175,000 2020 — 2021 — 2022 — 2023 — Thereafter — Total $ 24,175,000 |
RELATED-PARTY TRANSACTIONS AN_2
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
Schedule of related party transactions | The Company incurred commissions, fees and expense reimbursements as shown in the table below for services provided by CCI III Management and its affiliates related to the services described above during the periods indicated: Year Ended December 31, 2018 2017 2016 Selling commissions $ 540,706 $ 798,184 $ 15,500 Dealer manager fees $ 206,689 $ 331,799 $ 13,468 Distribution and stockholder servicing fees (1) $ 65,165 $ 21,753 $ 16 Organization and offering costs $ 109,044 $ 169,994 $ 31,962 Acquisition fees and expenses $ — $ 330,000 $ 665,090 Advisory fees $ — $ 60,565 $ 74,289 Operating expenses $ — $ 50,000 $ 107,429 Financing coordination fees $ — $ 99,750 $ 220,000 ______________________ (1) Amounts are calculated for the respective periods in accordance with the dealer manager agreement and excludes the estimated liability for future distribution and stockholder servicing fees payable to CCO Capital of $188,000 and $217,000 for the years ended December 31, 2018 and 2017 , respectively, which is included in due to affiliates in the consolidated balance sheets with a corresponding decrease to capital in excess of par value, as described in Note 2 — Summary of Significant Accounting Policies. |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of dividends and distributions | The following table shows the character of the distributions the Company paid on a percentage basis for the years ended December 31, 2018 , 2017 and 2016 : Year Ended December 31, Character of Distributions: 2018 2017 2016 Ordinary dividends — % — % — % Nondividend distributions 100 % 100 % 100 % Total 100 % 100 % 100 % |
Schedule of deferred tax assets and liabilities | Deferred tax assets (liabilities) consisted of the following components as of the period indicated: Year Ended December 31, 2016 Fixed assets $ 337,888 Net operating loss 109,072 Deferred rent 72,948 Other (23,561 ) Valuation allowance (496,347 ) Total net deferred tax asset $ — |
Schedule of effective income tax rate reconciliation | The following is a reconciliation of benefit from income taxes with the amount computed by applying the statutory federal income tax rate to loss before income taxes for the period indicated: Year Ended December 31, 2016 Net loss $ (1,392,279 ) Federal provision (benefit) at statutory rate (487,297 ) State and local provision at statutory rate (9,050 ) Change in valuation allowance against net deferred tax assets 496,347 Total benefit from income taxes $ — |
OPERATING LEASES (Tables)
OPERATING LEASES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Leases [Abstract] | |
Schedule of future minimum rental payments for operating leases | The future minimum rental income from the Company’s real estate assets under the non-cancelable operating leases, assuming no exercise of renewal options, as of December 31, 2018 , was as follows: Year Ending December 31, Future Minimum Rental Income 2019 $ 3,808,708 2020 3,878,462 2021 3,756,969 2022 3,829,450 2023 3,903,333 Thereafter 18,881,112 Total $ 38,058,034 |
QUARTERLY RESULTS (UNAUDITED) (
QUARTERLY RESULTS (UNAUDITED) (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of quarterly financial information | In the opinion of management, the information for the interim periods presented includes all adjustments, which are of a normal and recurring nature, necessary to present a fair presentation of the results for each period. December 31, 2018 First Quarter Second Quarter Third Quarter Fourth Quarter Revenues $ 1,101,694 $ 1,101,667 $ 1,101,666 $ 1,101,348 Net loss $ (192,338 ) $ (206,504 ) $ (183,344 ) $ (189,526 ) Basic and diluted net loss per share - Class A common stock (1) $ (0.08 ) $ (0.08 ) $ (0.06 ) $ (0.06 ) Basic and diluted net loss per share - Class T common stock (1) $ (0.10 ) $ (0.10 ) $ (0.08 ) $ (0.08 ) ____________________________________ (1) The Company calculates net loss per share based on the weighted-average number of outstanding shares of common stock during the reporting period. The average number of shares fluctuates throughout the year and can therefore produce a full year result that does not agree to the sum of the individual quarters. December 31, 2017 First Quarter Second Quarter Third Quarter Fourth Quarter Revenues $ 744,504 $ 739,749 $ 1,581,290 $ 1,039,054 Net loss $ (327,144 ) $ (228,657 ) $ (135,116 ) $ (431,078 ) Basic and diluted net loss per share - Class A common stock (1) $ (0.66 ) $ (0.23 ) $ (0.09 ) $ (0.21 ) Basic and diluted net loss per share - Class T common stock (1) $ (0.68 ) $ (0.26 ) $ (0.11 ) $ (0.24 ) ____________________________________ (1) The Company calculates net loss per share based on the weighted-average number of outstanding shares of common stock during the reporting period. The average number of shares fluctuates throughout the year and can therefore produce a full year result that does not agree to the sum of the individual quarters. |
ORGANIZATION AND BUSINESS (Deta
ORGANIZATION AND BUSINESS (Details) | 12 Months Ended | ||||||
Dec. 31, 2018USD ($)class_of_stock$ / sharesshares | Dec. 31, 2017USD ($)shares | Dec. 31, 2016USD ($)shares | Feb. 19, 2019$ / shares | Sep. 22, 2016USD ($)class_of_stock$ / shares | Dec. 31, 2015shares | Jul. 14, 2014$ / shares | |
Class of Stock [Line Items] | |||||||
Classes of common stock | class_of_stock | 2 | 2 | |||||
Net asset value per share | $ / shares | $ 8.60 | ||||||
Proceeds from issuance of common stock | $ 10,187,281 | $ 16,677,720 | $ 2,935,000 | ||||
Distribution and stockholder fees payable | 188,000 | 217,000 | |||||
Common Stock | |||||||
Class of Stock [Line Items] | |||||||
Share price (in dollars per share) | $ / shares | $ 25 | ||||||
Distribution and stockholder servicing fees | Advisors | |||||||
Class of Stock [Line Items] | |||||||
Related party transaction, expenses from transactions with related party | $ 65,165 | $ 21,753 | $ 16 | ||||
Class A Common Stock | |||||||
Class of Stock [Line Items] | |||||||
Common stock, shares outstanding (in shares) | shares | 2,424,682 | 1,436,855 | |||||
Common stock, shares issued (in shares) | shares | 2,424,682 | 1,436,855 | |||||
Class A Common Stock | Common Stock | |||||||
Class of Stock [Line Items] | |||||||
Common stock, shares outstanding (in shares) | shares | 2,424,682 | 1,436,855 | 334,618 | 20,000 | |||
Class T Common Stock | |||||||
Class of Stock [Line Items] | |||||||
Common stock, shares outstanding (in shares) | shares | 747,316 | 631,346 | |||||
Common stock, shares issued (in shares) | shares | 747,316 | 631,346 | |||||
Class T Common Stock | Common Stock | |||||||
Class of Stock [Line Items] | |||||||
Common stock, shares outstanding (in shares) | shares | 747,316 | 631,346 | 5,225 | 0 | |||
Class T Common Stock | Distribution and stockholder servicing fees | Advisors | |||||||
Class of Stock [Line Items] | |||||||
Related party transaction, expenses from transactions with related party | $ 87,000 | ||||||
Initial public offering | |||||||
Class of Stock [Line Items] | |||||||
Common stock shares authorized, value | $ 3,500,000,000 | ||||||
Initial public offering | Common Stock | |||||||
Class of Stock [Line Items] | |||||||
Common stock, shares outstanding (in shares) | shares | 3,100,000 | ||||||
Proceeds from issuance of common stock | $ 30,500,000 | ||||||
Organization and offering costs, selling commissions and dealer manager fees | 2,200,000 | ||||||
Initial public offering | Class A Common Stock | Common Stock | |||||||
Class of Stock [Line Items] | |||||||
Proceeds from issuance of common stock | 23,400,000 | ||||||
Initial public offering | Class T Common Stock | Common Stock | |||||||
Class of Stock [Line Items] | |||||||
Proceeds from issuance of common stock | $ 7,100,000 | ||||||
Multi class offering | |||||||
Class of Stock [Line Items] | |||||||
Common stock shares authorized, value | 2,500,000,000 | ||||||
Multi class offering | Class A Common Stock | |||||||
Class of Stock [Line Items] | |||||||
Common stock shares authorized, value | $ 1,250,000,000 | ||||||
Share price (in dollars per share) | $ / shares | $ 10 | ||||||
Multi class offering | Class T Common Stock | |||||||
Class of Stock [Line Items] | |||||||
Common stock shares authorized, value | $ 1,250,000,000 | ||||||
Share price (in dollars per share) | $ / shares | $ 9.57 | ||||||
Distribution reinvestment plan | |||||||
Class of Stock [Line Items] | |||||||
Common stock shares authorized, value | $ 1,000,000,000 | ||||||
Share price (in dollars per share) | $ / shares | $ 9.10 | $ 9.10 | |||||
Common stock, shares issued (in shares) | shares | 82,000 | ||||||
CCI III OP | |||||||
Class of Stock [Line Items] | |||||||
General partner partnership interest percentage | 100.00% | ||||||
Subsequent Event | Distribution reinvestment plan | Class A Common Stock | Common Stock | |||||||
Class of Stock [Line Items] | |||||||
Share price (in dollars per share) | $ / shares | $ 8.60 | ||||||
Subsequent Event | Distribution reinvestment plan | Class T Common Stock | Common Stock | |||||||
Class of Stock [Line Items] | |||||||
Share price (in dollars per share) | $ / shares | $ 8.60 | ||||||
The Share Redemption Program | Common Stock | |||||||
Class of Stock [Line Items] | |||||||
Net asset value per share | $ / shares | $ 8.60 |
ORGANIZATION AND BUSINESS (Real
ORGANIZATION AND BUSINESS (Real Estate) (Details) | Dec. 31, 2018ft²propertystates |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of real estate properties | property | 2 |
Net rentable square feet | ft² | 391,000 |
Number of states | states | 2 |
Percentage of rentable space leased | 100.00% |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Real Estate) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Real Estate Properties [Line Items] | |||
Impairment | $ 0 | $ 0 | $ 0 |
Assets held for sale | $ 0 | $ 0 | |
Buildings | |||
Real Estate Properties [Line Items] | |||
Acquired real estate asset, useful life (in years) | 40 years | ||
Site Improvements | |||
Real Estate Properties [Line Items] | |||
Acquired real estate asset, useful life (in years) | 15 years |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Other Narrative) (Details) | 12 Months Ended | |||
Dec. 31, 2018USD ($)segmentclass_of_stockshares | Dec. 31, 2017USD ($)shares | Dec. 31, 2016shares | Sep. 22, 2016class_of_stock | |
Accounting Policies [Abstract] | ||||
Deferred finance costs | $ 407,000 | $ 1,000,000 | ||
Due to affiliates | 188,000 | 278,000 | ||
Allowance for uncollectible accounts | $ 0 | $ 0 | ||
Classes of common stock | class_of_stock | 2 | 2 | ||
Antidilutive securities (in shares) | shares | 0 | 0 | 0 | |
Number of reportable segments | segment | 1 |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Distribution and Stockholder Servicing Fees) (Details) - Advisors | Feb. 19, 2019 | Dec. 31, 2018 |
Class T Common Stock | ||
Related Party Transaction [Line Items] | ||
Net asset value, daily accrual rate | 0.00274% | |
Class T Common Stock | Subsequent Event | ||
Related Party Transaction [Line Items] | ||
Net asset value, daily accrual rate | 0.00274% | |
Distribution and stockholder servicing fees | ||
Related Party Transaction [Line Items] | ||
Related party transaction, daily distribution and servicing fee, termination of payments threshold, percentage of total gross investment | 4.00% | |
Related party transaction, daily distribution and servicing fee, termination of payments threshold, percentage of gross proceeds from shares in offering | 10.00% | |
Distribution and stockholder servicing fees | Class T Common Stock | Maximum | ||
Related Party Transaction [Line Items] | ||
Related party expense from transaction, percent of gross proceeds | 4.00% |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Offering and Related Costs) (Details) | Dec. 31, 2018 |
Other organization and offering expenses | Maximum | Advisors | |
Related Party Transaction [Line Items] | |
Organization and offering expense limit, percent | 1.00% |
FAIR VALUE MEASUREMENTS (Narrat
FAIR VALUE MEASUREMENTS (Narrative) (Details) - Affiliated entity - Fair value, inputs, level 2 - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Estimate of fair value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Notes payable | $ 24.3 | $ 33.8 |
Carrying value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Notes payable | $ 24.2 | $ 33.6 |
REAL ESTATE ASSET (Narrative) (
REAL ESTATE ASSET (Narrative) (Details) | 12 Months Ended | ||
Dec. 31, 2018USD ($)property | Dec. 31, 2017USD ($)property | Dec. 31, 2016USD ($)property | |
Business Acquisition [Line Items] | |||
Acquisition-related expenses | $ 0 | $ 41,576 | $ 764,622 |
Acquisitions, 2018 | |||
Business Acquisition [Line Items] | |||
Number of businesses acquired (in properties) | property | 0 | ||
Acquisitions, 2017 | |||
Business Acquisition [Line Items] | |||
Number of businesses acquired (in properties) | property | 1 | ||
Aggregate purchase price | $ 16,900,000 | ||
Acquisition-related expenses | $ 355,000 | ||
Acquisitions, 2016 | |||
Business Acquisition [Line Items] | |||
Number of businesses acquired (in properties) | property | 1 | ||
Aggregate purchase price | $ 32,800,000 | ||
Acquisition-related expenses | 765,000 | ||
Recorded revenue | 798,000 | ||
Recorded profit (loss) | $ (439,000) |
REAL ESTATE ASSET (Purchase Pri
REAL ESTATE ASSET (Purchase Price Allocation) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Acquisitions, 2017 | ||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net [Abstract] | ||
Land | $ 937,691 | |
Buildings and improvements | 14,287,443 | |
Total purchase price | 16,855,205 | |
Acquisitions, 2017 | Acquired in-place leases | ||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net [Abstract] | ||
Acquired in-place lease | $ 1,630,071 | |
Weighted average amortization period | 16 years 2 months 11 days | |
Acquisitions, 2016 | ||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net [Abstract] | ||
Land | $ 2,307,312 | |
Buildings and improvements | 26,971,327 | |
Total purchase price | 32,750,000 | |
Acquisitions, 2016 | Acquired in-place leases | ||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net [Abstract] | ||
Acquired in-place lease | $ 3,471,361 | |
Weighted average amortization period | 9 years 7 months 5 days |
REAL ESTATE ASSET (Pro forma Ba
REAL ESTATE ASSET (Pro forma Basis) (Details) - Acquisitions, 2016 - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Pro forma basis | ||
Revenue | $ 2,922,263 | $ 2,922,263 |
Net loss | $ (1,612,080) | $ (1,418,625) |
INTANGIBLE LEASE ASSETS (Detail
INTANGIBLE LEASE ASSETS (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Finite-Lived Intangible Assets [Line Items] | ||
Accumulated amortization | $ 944,000 | |
Acquired in-place leases | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible leased asset | 4,157,891 | $ 4,620,949 |
Accumulated amortization | $ 943,541 | $ 480,483 |
Useful life | 9 years 9 months | 10 years 9 months |
INTANGIBLE LEASE ASSETS (Schedu
INTANGIBLE LEASE ASSETS (Schedule of finite-lived intangible assets amortization expense) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Acquired in-place leases | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization expense | $ 463,058 | $ 374,832 | $ 105,651 |
INTANGIBLE LEASE ASSETS (Estima
INTANGIBLE LEASE ASSETS (Estimated Amortization of Intangible lease assets) (Details) - Acquired in-place leases | Dec. 31, 2018USD ($) |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | |
2019 | $ 463,058 |
2020 | 463,058 |
2021 | 463,058 |
2022 | 463,058 |
2023 | $ 463,058 |
CREDIT FACILITY AND SUBORDINA_3
CREDIT FACILITY AND SUBORDINATE PROMISSORY NOTE (Credit facility and Subordinate promissory note) (Details) | 12 Months Ended | ||
Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Sep. 23, 2016USD ($) | |
Line of Credit Facility [Line Items] | |||
Long-term debt | $ 24,175,000 | $ 33,575,000 | |
Debt, weighted average interest rate | 4.70% | ||
Weighted average remaining term | 9 months | ||
Credit facility | $ 24,175,000 | 31,975,000 | |
Line of credit | |||
Line of Credit Facility [Line Items] | |||
Long-term debt | $ 24,175,000 | $ 31,975,000 | |
JPMorgan Chase Bank, N.A. | Line of credit | Revolving credit facility | |||
Line of Credit Facility [Line Items] | |||
Debt, weighted average interest rate | 4.70% | ||
Credit facility | $ 24,200,000 | ||
Line of credit facility, maximum borrowing capacity | $ 100,000,000 | ||
Extension fee percentage | 0.20% | ||
Line of credit facility, remaining available borrowing capacity | $ 75,800,000 | ||
Line of credit facility, covenant, minimum consolidated net worth (percentage) | 75.00% | ||
JPMorgan Chase Bank, N.A. | Minimum | Line of credit | Revolving credit facility | |||
Line of Credit Facility [Line Items] | |||
Interest rate spread (percentage) | 1.20% | ||
Debt covenant fixed charge coverage ratio | 1.50 | ||
JPMorgan Chase Bank, N.A. | Maximum | Line of credit | Revolving credit facility | |||
Line of Credit Facility [Line Items] | |||
Interest rate spread (percentage) | 1.45% | ||
Debt covenant leverage ratio | 60.00% | ||
JPMorgan Chase Bank, N.A. | LIBOR | Minimum | Line of credit | Revolving credit facility | |||
Line of Credit Facility [Line Items] | |||
Debt instrument, basis spread on variable rate | 2.20% | ||
JPMorgan Chase Bank, N.A. | LIBOR | Maximum | Line of credit | Revolving credit facility | |||
Line of Credit Facility [Line Items] | |||
Debt instrument, basis spread on variable rate | 2.45% | ||
JPMorgan Chase Bank, N.A. | Federal Funds Effective Rate | Line of credit | Revolving credit facility | |||
Line of Credit Facility [Line Items] | |||
Debt instrument, basis spread on variable rate | 0.50% | ||
JPMorgan Chase Bank, N.A. | Statutory Reserve Rate | Line of credit | Revolving credit facility | |||
Line of Credit Facility [Line Items] | |||
Debt instrument, basis spread on variable rate | 1.00% | ||
Affiliated entity | Line of credit | Subordinate promissory note | |||
Line of Credit Facility [Line Items] | |||
Long-term debt | $ 0 | ||
Line of credit facility, maximum borrowing capacity | $ 30,000,000 | ||
Interest rate spread (percentage) | 1.75% | ||
Financing Coordination Fees | Affiliated entity | Line of credit | Subordinate promissory note | |||
Line of Credit Facility [Line Items] | |||
Related party transaction, expenses from transactions with related party | $ 0 |
CREDIT FACILITY AND SUBORDINA_4
CREDIT FACILITY AND SUBORDINATE PROMISSORY NOTE (Schedule of Debt) (Details) | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Debt [Roll Forward] | |
Total debt, net, beginning of period | $ 33,575,000 |
Debt Issuance | 2,200,000 |
Repayments | (11,600,000) |
Accretion | 0 |
Total debt, net, end of period | 24,175,000 |
Credit facility | |
Debt [Roll Forward] | |
Total debt, net, beginning of period | 31,975,000 |
Debt Issuance | 0 |
Repayments | (7,800,000) |
Accretion | 0 |
Total debt, net, end of period | 24,175,000 |
Subordinate promissory note | |
Debt [Roll Forward] | |
Total debt, net, beginning of period | 1,600,000 |
Debt Issuance | 2,200,000 |
Repayments | (3,800,000) |
Accretion | 0 |
Total debt, net, end of period | $ 0 |
CREDIT FACILITY AND SUBORDINA_5
CREDIT FACILITY AND SUBORDINATE PROMISSORY NOTE (Future Debt Repayments Schedule) (Details) | Dec. 31, 2018USD ($) |
Long-term Debt, Fiscal Year Maturity [Abstract] | |
2019 | $ 24,175,000 |
2020 | 0 |
2021 | 0 |
2022 | 0 |
2023 | 0 |
Thereafter | 0 |
Total | $ 24,175,000 |
RELATED-PARTY TRANSACTIONS AN_3
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS (Selling commissions and dealer manager fees) (Details) - Dealer manager | Dec. 31, 2018 |
Selling commissions | |
Related Party Transaction [Line Items] | |
Expense reallowed | 100.00% |
Class A Common Stock | Dealer manager fees | |
Related Party Transaction [Line Items] | |
Commissions percentage on stock sales and related dealer manager fees | 2.00% |
Class T Common Stock | Dealer manager fees | |
Related Party Transaction [Line Items] | |
Commissions percentage on stock sales and related dealer manager fees | 2.00% |
Maximum | Class A Common Stock | Selling commissions | |
Related Party Transaction [Line Items] | |
Related party expense from transaction, percent of gross proceeds | 7.00% |
Maximum | Class T Common Stock | Selling commissions | |
Related Party Transaction [Line Items] | |
Commissions percentage on stock sales and related dealer manager fees | 3.00% |
RELATED-PARTY TRANSACTIONS AN_4
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS (Organization and offering expenses) (Details) | Dec. 31, 2018 |
Advisors | Other organization and offering expenses | |
Related Party Transaction [Line Items] | |
Related party expense from transaction, percent of gross proceeds | 1.00% |
RELATED-PARTY TRANSACTIONS AN_5
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS (Distribution and stockholder servicing fees) (Details) - Advisors | Feb. 19, 2019 | Dec. 31, 2018 |
Distribution and stockholder servicing fees | ||
Related Party Transaction [Line Items] | ||
Related party transaction, daily distribution and servicing fee, termination of payments threshold, percentage of total gross investment | 4.00% | |
Related party transaction, daily distribution and servicing fee, termination of payments threshold, percentage of gross proceeds from shares in offering | 10.00% | |
Class T Common Stock | ||
Related Party Transaction [Line Items] | ||
Net asset value, daily accrual rate | 0.00274% | |
Subsequent Event | Class T Common Stock | ||
Related Party Transaction [Line Items] | ||
Net asset value, daily accrual rate | 0.00274% |
RELATED-PARTY TRANSACTIONS AN_6
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS (Acquisition fees and expenses) (Details) - Maximum - Advisors - Acquisition fees and expenses | Dec. 31, 2018 |
Related Party Transaction [Line Items] | |
Acquisition and expenses percentage | 2.00% |
Acquisition fees and expenses, reimbursement, percentage | 6.00% |
RELATED-PARTY TRANSACTIONS AN_7
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS (Advisory fees and expenses) (Details) | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Advisors | Advisory fees | |
Related Party Transaction [Line Items] | |
Expense exceeding the expense limit | $ 576,000 |
Average invested assets between $0 to $2 billion | Advisors | Advisory fees | |
Related Party Transaction [Line Items] | |
Asset management or advisory fees percent | 0.75% |
Average invested assets between $2 billion to $4 billion | Advisors | Advisory fees | |
Related Party Transaction [Line Items] | |
Asset management or advisory fees percent | 0.70% |
Average invested assets over $4 billion | Advisors | Advisory fees | |
Related Party Transaction [Line Items] | |
Asset management or advisory fees percent | 0.65% |
Minimum | Advisors | Advisory fees | |
Related Party Transaction [Line Items] | |
Reimbursement of related party expense threshold, percent of average invested assets | 2.00% |
Reimbursement of related party expense threshold, percent of net income | 25.00% |
Minimum | Average invested assets between $0 to $2 billion | |
Related Party Transaction [Line Items] | |
Average invested assets | $ 0 |
Minimum | Average invested assets between $2 billion to $4 billion | |
Related Party Transaction [Line Items] | |
Average invested assets | 2,000,000,000 |
Minimum | Average invested assets over $4 billion | |
Related Party Transaction [Line Items] | |
Average invested assets | 4,000,000,000 |
Maximum | Average invested assets between $0 to $2 billion | |
Related Party Transaction [Line Items] | |
Average invested assets | 2,000,000,000 |
Maximum | Average invested assets between $2 billion to $4 billion | |
Related Party Transaction [Line Items] | |
Average invested assets | $ 4,000,000,000 |
RELATED-PARTY TRANSACTIONS AN_8
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS (Operating expenses) (Details) - Operating expenses - Advisors - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Related Party Transaction [Line Items] | |||
Related party transaction, expenses from transactions with related party | $ 0 | $ 50,000 | $ 107,429 |
Expense exceeding the expense limit | $ 1,500,000 | ||
Minimum | |||
Related Party Transaction [Line Items] | |||
Reimbursement of related party expense threshold, percent of average invested assets | 2.00% | ||
Reimbursement of related party expense threshold, percent of net income | 25.00% |
RELATED-PARTY TRANSACTIONS AN_9
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS (Financing coordination fees) (Details) | Dec. 31, 2018 |
Advisors | Financing coordination fees | |
Related Party Transaction [Line Items] | |
Expense from related party transaction, percent | 1.00% |
RELATED-PARTY TRANSACTIONS A_10
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS (Disposition fees) (Details) - Advisors - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Property sales commission | |||
Related Party Transaction [Line Items] | |||
Commissions performance and other fees percent | 1.00% | ||
Related party transaction, expenses from transactions with related party | $ 0 | $ 0 | $ 0 |
Maximum | Brokerage Commission Fee | |||
Related Party Transaction [Line Items] | |||
Expense from related party transaction, percent | 50.00% | ||
Maximum | Property Portfolio | |||
Related Party Transaction [Line Items] | |||
Commissions performance and other fees percent | 6.00% |
RELATED-PARTY TRANSACTIONS A_11
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS (Subordinated performance fees) (Details) - Advisors - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Related Party Transaction [Line Items] | |||
Cumulative noncompounded annual return | 6.00% | ||
Subordinate performance fees on event of sale of company | |||
Related Party Transaction [Line Items] | |||
Commissions performance and other fees percent | 15.00% | ||
Subordinate fees for listing | |||
Related Party Transaction [Line Items] | |||
Commissions performance and other fees percent | 15.00% | ||
Subordinated performance fees | |||
Related Party Transaction [Line Items] | |||
Related party transaction, expenses from transactions with related party | $ 0 | $ 0 | $ 0 |
RELATED-PARTY TRANSACTIONS A_12
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS (Schedule of related party transactions) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Related Party Transaction [Line Items] | |||
Distribution and stockholder fees payable | $ 188,000 | $ 217,000 | |
Selling commissions | Advisors | |||
Related Party Transaction [Line Items] | |||
Related party transaction, expenses from transactions with related party | 540,706 | 798,184 | $ 15,500 |
Dealer manager fees | Advisors | |||
Related Party Transaction [Line Items] | |||
Related party transaction, expenses from transactions with related party | 206,689 | 331,799 | 13,468 |
Distribution and stockholder servicing fees | Advisors | |||
Related Party Transaction [Line Items] | |||
Related party transaction, expenses from transactions with related party | 65,165 | 21,753 | 16 |
Organization and offering costs | Advisors | |||
Related Party Transaction [Line Items] | |||
Related party transaction, expenses from transactions with related party | 109,044 | 169,994 | 31,962 |
Acquisition fees and expenses | Advisors | |||
Related Party Transaction [Line Items] | |||
Related party transaction, expenses from transactions with related party | 0 | 330,000 | 665,090 |
Advisory fees | Advisors | |||
Related Party Transaction [Line Items] | |||
Related party transaction, expenses from transactions with related party | 0 | 60,565 | 74,289 |
Operating expenses | Advisors | |||
Related Party Transaction [Line Items] | |||
Related party transaction, expenses from transactions with related party | 0 | 50,000 | 107,429 |
Financing coordination fees | Advisors | |||
Related Party Transaction [Line Items] | |||
Related party transaction, expenses from transactions with related party | $ 0 | $ 99,750 | $ 220,000 |
RELATED-PARTY TRANSACTIONS A_13
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS (Due to/from Affiliates) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Related Party Transaction [Line Items] | ||
Due to affiliates | $ 188,000 | $ 278,000 |
Affiliated entity | ||
Related Party Transaction [Line Items] | ||
Due to affiliates | 188,000 | 278,000 |
Advisor | ||
Related Party Transaction [Line Items] | ||
Due from affiliates | 1,000 | 0 |
Revolving credit facility | Line of credit | Series C, Llc | ||
Related Party Transaction [Line Items] | ||
Due to affiliates | 10,000 | |
Related party, interest expense | $ 53,000 | $ 262,000 |
STOCKHOLDER'S EQUITY (Narrative
STOCKHOLDER'S EQUITY (Narrative) (Details) | Dec. 31, 2015shares | Dec. 30, 2015 | Jul. 14, 2014$ / sharesshares | Dec. 31, 2018$ / sharesshares | Dec. 31, 2017$ / sharesshares | Dec. 31, 2016shares |
Class of Stock [Line Items] | ||||||
Common stock, shares authorized (in shares) | 490,000,000 | 490,000,000 | ||||
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 | ||||
Common stock, par value (in usd per share) | $ / shares | $ 0.01 | |||||
Class A Common Stock | ||||||
Class of Stock [Line Items] | ||||||
Common stock, shares authorized (in shares) | 245,000,000 | 245,000,000 | ||||
Common stock, par value (in usd per share) | $ / shares | $ 0.01 | $ 0.01 | ||||
Stock issued during period, shares, stock splits, conversion ratio | 2.5 | |||||
Class T Common Stock | ||||||
Class of Stock [Line Items] | ||||||
Common stock, shares authorized (in shares) | 245,000,000 | 245,000,000 | ||||
Common stock, par value (in usd per share) | $ / shares | $ 0.01 | $ 0.01 | ||||
Common Stock | ||||||
Class of Stock [Line Items] | ||||||
Issuance of common stock (in shares) | 8,000 | |||||
Share price (in dollars per share) | $ / shares | $ 25 | |||||
Common Stock | Class A Common Stock | ||||||
Class of Stock [Line Items] | ||||||
Issuance of common stock (in shares) | 20,000 | 984,096 | 1,102,237 | 314,618 | ||
Common Stock | Class T Common Stock | ||||||
Class of Stock [Line Items] | ||||||
Issuance of common stock (in shares) | 115,970 | 626,121 | 5,225 |
STOCKHOLDER'S EQUITY (Distribut
STOCKHOLDER'S EQUITY (Distribution reinvestment plan) (Details) - USD ($) | 12 Months Ended | |||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Feb. 19, 2019 | Sep. 22, 2016 | Jul. 14, 2014 | |
Class of Stock [Line Items] | ||||||
Net asset value per share | $ 8.60 | |||||
Dividend reinvestment plan, termination notice period | 10 days | |||||
Common stock issued through distribution reinvestment plan | $ 569,926 | $ 179,564 | $ 0 | |||
Distribution reinvestment plan | ||||||
Class of Stock [Line Items] | ||||||
Share price (in dollars per share) | $ 9.10 | $ 9.10 | ||||
Common Stock | ||||||
Class of Stock [Line Items] | ||||||
Share price (in dollars per share) | $ 25 | |||||
Common Stock | Distribution reinvestment plan | ||||||
Class of Stock [Line Items] | ||||||
Stock issued during period, distribution reinvestment plan (in shares) | 63,000 | 20,000 | 0 | |||
Common stock issued through distribution reinvestment plan | $ 570,000 | $ 180,000 | ||||
Class A Common Stock | Subsequent Event | Common Stock | Distribution reinvestment plan | ||||||
Class of Stock [Line Items] | ||||||
Share price (in dollars per share) | $ 8.60 | |||||
Class T Common Stock | Subsequent Event | Common Stock | Distribution reinvestment plan | ||||||
Class of Stock [Line Items] | ||||||
Share price (in dollars per share) | $ 8.60 |
STOCKHOLDER'S EQUITY (Share red
STOCKHOLDER'S EQUITY (Share redemption program) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Class of Stock [Line Items] | |||
Stock repurchase program, required holding period | 1 year | ||
Stock redemption program, number of shares authorized to be repurchased, percentage of weighted average number of shares outstanding | 5.00% | ||
Net asset value per share | $ 8.60 | ||
Stock redemption program, termination notice period | 30 days | ||
Stock redeemed during period (in shares) | 5,300 | 0 | 0 |
Redemptions of common stock | $ 48,015 | ||
Maximum | |||
Class of Stock [Line Items] | |||
Stock redemption program, number of shares authorized to be repurchased, percentage of weighted average number of shares outstanding | 1.25% | ||
Stock redemption program, redemption priority (in shares) | 250 | ||
Common Stock | The Share Redemption Program | |||
Class of Stock [Line Items] | |||
Net asset value per share | $ 8.60 |
STOCKHOLDER'S EQUITY (Distrib_2
STOCKHOLDER'S EQUITY (Distribution payable and distributions policy) (Details) - USD ($) | 3 Months Ended | |||
Jun. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Class of Stock [Line Items] | ||||
Distributions payable | $ 155,111 | $ 100,241 | $ 16,546 | |
Subsequent Event | Class A Common Stock | ||||
Class of Stock [Line Items] | ||||
Daily distributions payable amount per share (in usd per share) | $ 0.001369863 | |||
Subsequent Event | Class T Common Stock | ||||
Class of Stock [Line Items] | ||||
Daily distributions payable amount per share (in usd per share) | $ 0.001369863 |
STOCKHOLDER'S EQUITY (Equity Ba
STOCKHOLDER'S EQUITY (Equity Based Compensation) (Details) - CCIT III 2018 Equity Incentive Plan - USD ($) | Oct. 01, 2018 | Dec. 31, 2018 | Aug. 09, 2018 |
Restricted Stock | Class A Common Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares granted to each independent member of Board of Directors (in shares) | 3,000 | ||
Shares granted (in shares) | 9,000 | ||
Vesting period | 1 year | ||
Unrecognized compensation expense | $ 62,000 | ||
General and Administrative Expense | Restricted Stock | Class A Common Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation expense | $ 21,000 | ||
Common Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares reserved for issuance (in shares) | 400,000 | ||
Shares available for future grants (in shares) | 391,000 |
INCOME TAXES (Schedule of divid
INCOME TAXES (Schedule of dividends and distributions) (Details) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |||
Ordinary dividends | 0.00% | 0.00% | 0.00% |
Nondividend distributions | 100.00% | 100.00% | 100.00% |
Total | 100.00% | 100.00% | 100.00% |
INCOME TAXES (Narrative) (Detai
INCOME TAXES (Narrative) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Operating Loss Carryforwards [Line Items] | |||
Percent of total income distributed as dividends | 100.00% | ||
Income tax expense (benefit) | $ 0 | $ 0 | |
State and local income and franchise taxes | $ 6,500 | 2,500 | 300 |
Deferred tax assets, valuation allowance | $ 496,347 | ||
Effective income tax rate | 0.00% | ||
Unrecognized tax benefits | $ 0 | $ 0 | $ 0 |
Federal | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | 303,000 | ||
Local | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | $ 306,000 |
INCOME TAXES (Schedule of Defer
INCOME TAXES (Schedule of Deferred Tax Assets) (Details) | Dec. 31, 2016USD ($) |
Income Tax Disclosure [Abstract] | |
Fixed assets | $ 337,888 |
Net operating loss | 109,072 |
Deferred rent | 72,948 |
Other | (23,561) |
Valuation allowance | (496,347) |
Total net deferred tax asset | $ 0 |
INCOME TAXES (Schedule of effec
INCOME TAXES (Schedule of effective tax rate reconciliation) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |||||||||||
Net loss | $ (189,526) | $ (183,344) | $ (206,504) | $ (192,338) | $ (431,078) | $ (135,116) | $ (228,657) | $ (327,144) | $ (771,712) | $ (1,121,995) | $ (1,392,279) |
Federal provision (benefit) at statutory rate | (487,297) | ||||||||||
State and local provision at statutory rate | (9,050) | ||||||||||
Change in valuation allowance against net deferred tax assets | 496,347 | ||||||||||
Total benefit from income taxes | $ 0 | $ 0 |
OPERATING LEASES (Details)
OPERATING LEASES (Details) | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Operating Leased Assets [Line Items] | |
2019 | $ 3,808,708 |
2020 | 3,878,462 |
2021 | 3,756,969 |
2022 | 3,829,450 |
2023 | 3,903,333 |
Thereafter | 18,881,112 |
Total | $ 38,058,034 |
Acquired in-place leases | |
Operating Leased Assets [Line Items] | |
Operating leases of lessor, weighted average remaining lease term | 9 years 8 months 11 days |
QUARTERLY RESULTS (UNAUDITED)_2
QUARTERLY RESULTS (UNAUDITED) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Class of Stock [Line Items] | |||||||||||
Revenues | $ 1,101,348 | $ 1,101,666 | $ 1,101,667 | $ 1,101,694 | $ 1,039,054 | $ 1,581,290 | $ 739,749 | $ 744,504 | $ 4,406,375 | $ 4,104,597 | $ 798,433 |
Net loss | $ (189,526) | $ (183,344) | $ (206,504) | $ (192,338) | $ (431,078) | $ (135,116) | $ (228,657) | $ (327,144) | (771,712) | (1,121,995) | (1,392,279) |
Class A Common Stock | |||||||||||
Class of Stock [Line Items] | |||||||||||
Net loss | $ (523,089) | $ (894,373) | $ (1,389,630) | ||||||||
Basic and diluted net loss per common share (in dollars per share) | $ (0.06) | $ (0.06) | $ (0.08) | $ (0.08) | $ (0.21) | $ (0.09) | $ (0.23) | $ (0.66) | $ (0.26) | $ (0.90) | $ (14.23) |
Class T Common Stock | |||||||||||
Class of Stock [Line Items] | |||||||||||
Net loss | $ (248,623) | $ (227,622) | $ (2,649) | ||||||||
Basic and diluted net loss per common share (in dollars per share) | $ (0.08) | $ (0.08) | $ (0.10) | $ (0.10) | $ (0.24) | $ (0.11) | $ (0.26) | $ (0.68) | $ (0.36) | $ (0.99) | $ (14.27) |
SUBSEQUENT EVENTS (Narrative) (
SUBSEQUENT EVENTS (Narrative) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||
Mar. 25, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Feb. 19, 2019 | Sep. 22, 2016 | Jul. 14, 2014 | |
Subsequent Event [Line Items] | |||||||
Stock redeemed during period (in shares) | 5,300 | 0 | 0 | ||||
Redemptions of common stock | $ 48,015 | ||||||
Net asset value per share | $ 8.60 | ||||||
Subsequent Event | |||||||
Subsequent Event [Line Items] | |||||||
Stock redeemed during period (in shares) | 5,400 | ||||||
Redemptions of common stock | $ 49,000 | ||||||
Stock redeemed during period (in usd per share) | $ 9 | ||||||
Distribution reinvestment plan | |||||||
Subsequent Event [Line Items] | |||||||
Share price (in dollars per share) | $ 9.10 | $ 9.10 | |||||
Common Stock | |||||||
Subsequent Event [Line Items] | |||||||
Share price (in dollars per share) | $ 25 | ||||||
Common Stock | Class A Common Stock | |||||||
Subsequent Event [Line Items] | |||||||
Stock redeemed during period (in shares) | 5,335 | ||||||
Redemptions of common stock | $ 53 | ||||||
Common Stock | Distribution reinvestment plan | Class T Common Stock | Subsequent Event | |||||||
Subsequent Event [Line Items] | |||||||
Share price (in dollars per share) | $ 8.60 | ||||||
Common Stock | Distribution reinvestment plan | Class A Common Stock | Subsequent Event | |||||||
Subsequent Event [Line Items] | |||||||
Share price (in dollars per share) | $ 8.60 | ||||||
The Share Redemption Program | Common Stock | |||||||
Subsequent Event [Line Items] | |||||||
Net asset value per share | $ 8.60 | ||||||
Operating expenses | Advisors | |||||||
Subsequent Event [Line Items] | |||||||
Expense exceeding the expense limit | $ 1,500,000 | ||||||
Advisory fees | Advisors | |||||||
Subsequent Event [Line Items] | |||||||
Expense exceeding the expense limit | $ 576,000 | ||||||
Minimum | Operating expenses | Advisors | |||||||
Subsequent Event [Line Items] | |||||||
Reimbursement of related party expense threshold, percent of average invested assets | 2.00% | ||||||
Reimbursement of related party expense threshold, percent of net income | 25.00% | ||||||
Minimum | Advisory fees | Advisors | |||||||
Subsequent Event [Line Items] | |||||||
Reimbursement of related party expense threshold, percent of average invested assets | 2.00% | ||||||
Reimbursement of related party expense threshold, percent of net income | 25.00% | ||||||
Revolving credit facility | JPMorgan Chase Bank, N.A. | Credit facility | |||||||
Subsequent Event [Line Items] | |||||||
Line of credit facility, maximum borrowing capacity | $ 100,000,000 | ||||||
Revolving credit facility | JPMorgan Chase Bank, N.A. | Credit facility | Subsequent Event | |||||||
Subsequent Event [Line Items] | |||||||
Line of credit facility, maximum borrowing capacity | $ 35,000,000 |
Schedule III - Real Estate As_2
Schedule III - Real Estate Assets And Accumulated Depreciation (Details) | 12 Months Ended | ||||
Dec. 31, 2018USD ($)property | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Real Estate and Accumulated Depreciation [Line Items] | |||||
Encumbrances | $ 0 | ||||
Initial Costs to Company | |||||
Land | 3,245,003 | ||||
Buildings & Improvements | 41,258,770 | ||||
Total Adjustments to Basis | 0 | ||||
Gross Amount at Which Carried at December 31, 2017 | $ 44,503,773 | $ 29,278,639 | $ 0 | 44,503,773 | $ 44,503,773 |
Accumulated Depreciation | 1,430,550 | 312,350 | 0 | 2,879,746 | 1,430,550 |
Intangible lease assets, gross | 5,101,432 | 5,101,432 | |||
Accumulated amortization | 944,000 | ||||
Aggregate cost for federal income tax purposes | 50,400,000 | ||||
SEC Schedule, 12-28, Real Estate Companies, Investment in Real Estate [Roll Forward] | |||||
Balance, beginning of period | 44,503,773 | 29,278,639 | 0 | ||
Additions | |||||
Acquisitions | 0 | 15,225,134 | 29,278,639 | ||
Improvements | 0 | 0 | 0 | ||
Total additions | 0 | 15,225,134 | 29,278,639 | ||
Deductions | |||||
Deductions | 0 | 0 | 0 | ||
Cost of real estate sold | 0 | 0 | 0 | ||
Total deductions | 0 | 0 | 0 | ||
Balance, end of period | 44,503,773 | 44,503,773 | 29,278,639 | ||
SEC Schedule, 12-28, Real Estate Companies, Investment in Real Estate, Accumulated Depreciation [Roll Forward] | |||||
Balance, beginning of period | 1,430,550 | 312,350 | 0 | ||
Additions | |||||
Acquisitions - Depreciation Expense for Building & Tenant Improvements Acquired | 1,449,196 | 1,118,200 | 312,350 | ||
Improvements - Depreciation Expense for Tenant Improvements & Building Equipment | 0 | 0 | 0 | ||
Total additions | 1,449,196 | 1,118,200 | 312,350 | ||
Deductions | |||||
Deductions | 0 | 0 | 0 | ||
Cost of real estate sold | 0 | 0 | 0 | ||
Total deductions | 0 | 0 | 0 | ||
Balance, end of period | $ 2,879,746 | $ 1,430,550 | $ 312,350 | ||
Credit facility | 24,175,000 | $ 31,975,000 | |||
Revolving credit facility | JPMorgan Chase Bank, N.A. | Line of credit | |||||
Deductions | |||||
Credit facility | 24,200,000 | ||||
Buildings | |||||
Deductions | |||||
Acquired real estate asset, useful life (in years) | 40 years | ||||
Site Improvements | |||||
Deductions | |||||
Acquired real estate asset, useful life (in years) | 15 years | ||||
Office property | |||||
Initial Costs to Company | |||||
Number of single-tenant commercial properties owned | property | 1 | ||||
Industrial property | |||||
Initial Costs to Company | |||||
Number of single-tenant commercial properties owned | property | 1 | ||||
Siemens Corp. | Milford, OH | |||||
Initial Costs to Company | |||||
Land | 2,307,312 | ||||
Buildings & Improvements | 26,971,327 | ||||
Total Adjustments to Basis | 0 | ||||
Gross Amount at Which Carried at December 31, 2017 | $ 29,278,639 | 29,278,639 | |||
Accumulated Depreciation | 2,454,180 | 2,454,180 | |||
Deductions | |||||
Balance, end of period | 29,278,639 | ||||
Deductions | |||||
Balance, end of period | 2,454,180 | ||||
Actuant | Columbus, WI | |||||
Initial Costs to Company | |||||
Land | 937,691 | ||||
Buildings & Improvements | 14,287,443 | ||||
Total Adjustments to Basis | 0 | ||||
Gross Amount at Which Carried at December 31, 2017 | 15,225,134 | 15,225,134 | |||
Accumulated Depreciation | 425,566 | $ 425,566 | |||
Deductions | |||||
Balance, end of period | 15,225,134 | ||||
Deductions | |||||
Balance, end of period | $ 425,566 |