Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2017 | May 09, 2017 | |
Document And Entity Information | ||
Entity Registrant Name | MVP REIT II, Inc. | |
Entity Central Index Key | 1,642,985 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Is Entity a Well-known Seasoned Issuer? | No | |
Is Entity a Voluntary Filer? | No | |
Is Entity's Reporting Status Current? | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 2,538,304 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2,017 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
ASSETS | ||
Cash | $ 4,675,000 | $ 4,885,000 |
Cash - restricted | 1,125,000 | 100,000 |
Prepaid expenses | 696,000 | 283,000 |
Accounts receivable | 351,000 | 208,000 |
Investments in MVP REIT, Inc. | 3,086,000 | 3,034,000 |
Investments in real estate | ||
Land and improvements | 41,554,000 | 28,854,000 |
Building and improvements | 72,903,000 | 24,889,000 |
Construction in progress | 521,000 | |
[us-gaap:PropertyPlantAndEquipmentGross] | 114,978,000 | 53,743,000 |
Accumulated depreciation | (620,000) | (195,000) |
Total investments in real estate, net | 114,358,000 | 53,548,000 |
Other assets | 282,000 | 4,575,000 |
Assets held for sale | 730,000 | 700,000 |
Investment in equity method investee | 1,150,000 | 1,150,000 |
Investments in cost method investee - held for sale | 836,000 | 836,000 |
Investments in cost method investee | 923,000 | 936,000 |
Total assets | 128,212,000 | 70,255,000 |
Liabilities | ||
Accounts payable and accrued liabilities | 624,000 | 485,000 |
Security Deposit | 46,000 | 2,000 |
Due to related parties | 929,000 | 575,000 |
Liabilities related to assets held for sale | 26,000 | |
Line of credit, net of unamortized loan issuance costs of approximately $0.2 million as of March 31, 2017 and December 31, 2016 | 19,674,000 | 7,957,000 |
Deferred revenue | 109,000 | 45,000 |
Notes payable, net of unamortized loan issuance costs of approximately $0.2 million and $0.1 million as of March 31, 2017 and December 31, 2016, respectively | 41,724,000 | 5,318,000 |
Total liabilities | 63,132,000 | 14,382,000 |
Commitments and contingencies | ||
MVP REIT II, Inc. Stockholders' Equity | ||
Preferred stock, $0.0001 par value, 1,000,000 shares authorized, none outstanding and Preferred stock Series A, $0.0001 par value, 50,000 shares authorized, 2,862 shares issued and outstanding | ||
Common stock, $0.0001 par value, 98,999,000 shares authorized, 2,521,088 and 2,301,828 shares issued and outstanding as of March 31, 2017 and December 31, 2016, respectively and Non-voting, non-participating convertible stock, $0.0001 par value, no shares issued and outstanding | ||
Additional paid-in capital | 63,283,000 | 56,143,000 |
Accumulated deficit | (7,380,000) | (4,394,000) |
Total MVP REIT II, Inc. Shareholders' Equity | 55,903,000 | 51,749,000 |
Non-controlling interest - related party | 9,177,000 | 4,124,000 |
Total equity | 65,080,000 | 55,873,000 |
Total liabilities and equity | 128,212,000 | 70,255,000 |
Preferred Stock Series A | ||
MVP REIT II, Inc. Stockholders' Equity | ||
Preferred stock, $0.0001 par value, 1,000,000 shares authorized, none outstanding and Preferred stock Series A, $0.0001 par value, 50,000 shares authorized, 2,862 shares issued and outstanding | ||
Non Voting Non Participating Convertible Stock | ||
MVP REIT II, Inc. Stockholders' Equity | ||
Common stock, $0.0001 par value, 98,999,000 shares authorized, 2,521,088 and 2,301,828 shares issued and outstanding as of March 31, 2017 and December 31, 2016, respectively and Non-voting, non-participating convertible stock, $0.0001 par value, no shares issued and outstanding |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
Line of credit, unamortized loan issuance costs | $ 200,000 | $ 200,000 |
Notes payable, unamortized loan issuance costs | $ 200,000 | $ 100,000 |
Preferred stock par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 98,999,000 | 98,999,000 |
Common stock, shares issued | 2,521,088 | 2,301,828 |
Preferred Stock Series A | ||
Preferred stock par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 50,000 | 50,000 |
Preferred stock, shares issued | 2,862 | 2,862 |
Preferred stock, shares outstanding | 2,862 | 2,862 |
Non Voting Non Participating Convertible Stock | ||
Common stock par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 0 | 0 |
Common stock, shares issued | 0 | 0 |
Common stock, shares outstanding | 0 | 0 |
Condensed Consolidated Statemen
Condensed Consolidated Statements Of Operations (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Revenues | ||
Rental revenue | $ 1,975,000 | |
Total revenues | 1,975,000 | |
Operating expenses | ||
General and administrative | 328,000 | 151,000 |
Merger costs | 125,000 | |
Acquisition expenses | 1,766,000 | |
Acquisition expenses - related party | 1,118,000 | 109,000 |
Operation and maintenance | 351,000 | |
Operation and maintenance - related party | 237,000 | |
Depreciation | 425,000 | |
Total operating expenses | 4,350,000 | 260,000 |
Loss from operations | (2,375,000) | (260,000) |
Other income (expense) | ||
Interest expense | (655,000) | (1,000) |
Distribution income - related party | 52,000 | |
Income (loss) from investment in equity method investee | 14,000 | (1,000) |
Total other expense | (589,000) | (2,000) |
Loss from continuing operations | (2,964,000) | (262,000) |
Discontinued operations, net of income taxes | ||
Income from assets held for sale, net of income taxes | 6,000 | |
Total income from discontinued operations | 6,000 | |
Provision for income taxes | ||
Net loss | (2,958,000) | (262,000) |
Net income attributable to non-controlling interest - related party | 28,000 | |
Net loss attributable to MVP REIT II, Inc.'s stockholders | $ (2,986,000) | $ (262,000) |
Basic and diluted loss per weighted average common share: | ||
Loss from continuing operations attributable to MVP REIT II, Inc.'s common stockholders - basic and diluted | $ (1.22) | $ (1.14) |
Income from discontinued operations - basic and diluted | 0.01 | |
Net loss attributable to MVP REIT II, Inc.'s common stockholders - basic and diluted | (1.23) | (1.14) |
Distributions declared per common share | $ (0.2) | $ (0.1) |
Weighted average common shares outstanding, basic and diluted | 2,425,200 | 228,843 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements Of Equity (Unaudited) - 3 months ended Mar. 31, 2017 - USD ($) | Preferred Stock | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Non-controlling Interest -Related Party | Total |
Beginning Balance at Dec. 31, 2016 | $ 56,143,000 | $ (4,394,000) | $ 4,124,000 | $ 55,873,000 | ||
Shares Outstanding at Dec. 31, 2016 | 2,301,828 | |||||
Par Value at Dec. 31, 2016 | ||||||
Distributions to non-controlling interest | (50,000) | (50,000) | ||||
Issuance of common stock | 4,750,000 | 4,750,000 | ||||
Issuance of common stock (Shares) | 189,988 | |||||
Issuance of common stock - DRIP | 285,000 | 285,000 | ||||
Issuance of common stock - DRIP (Shares) | 11,420 | |||||
Issuance of common stock - Dividend | ||||||
Issuance of common stock - Dividend (Shares) | 17,852 | |||||
Issuance of preferred stock | 2,556,000 | 2,556,000 | ||||
Issuance of preferred stock (Shares) | 2,862 | |||||
Non-controlling interest | 5,075,000 | 5,075,000 | ||||
Distributions | (451,000) | (451,000) | ||||
Net income (loss) | (2,986,000) | 28,000 | (2,958,000) | |||
Par Value at Mar. 31, 2017 | ||||||
Shares Outstanding at Mar. 31, 2017 | 2,862 | 2,521,088 | ||||
Ending Balance at Mar. 31, 2017 | $ 63,283,000 | $ (7,380,000) | $ 9,177,000 | $ 65,080,000 |
Condensed Consolidated Stateme6
Condensed Consolidated Statement Of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Cash flows from operating activities: | ||
Net loss | $ (2,958,000) | $ (262,000) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Income (loss) from investment in equity method investee | (14,000) | 1,000 |
Distribution from MVP REIT | (52,000) | |
Amortization of loan costs | 96,000 | |
Depreciation expense | 425,000 | |
Changes in operating assets and liabilities | ||
Cash - Restricted | (1,025,000) | |
Due to related parties | 354,000 | 37,000 |
Accounts payable | 137,000 | 32,000 |
Loan fees | (183,000) | |
Security deposits | 44,000 | |
Deferrerd revenue | 64,000 | |
Assets held for sale, net of liabilities | (4,000) | |
Accounts Receivable | (143,000) | |
Prepaid expenses | (413,000) | 58,000 |
Net cash used in operating activities | (3,672,000) | (134,000) |
Cash flows from investing activities: | ||
Purchase of investment in real estate | (56,700,000) | |
Building improvements | (14,000) | |
Payments made for future acquisitions | (227,000) | |
Distribution received from investment in cost method investee | 13,000 | |
Distribution received from investment in equity method investee | 14,000 | |
Investment in cost method investee | (2,793,000) | |
Investment in equity method investee | (600,000) | |
Proceeds from non-controlling interest | 5,075,000 | |
Net cash used in investing activities | (51,839,000) | (3,393,000) |
Cash flows from financing activities: | ||
Proceeds from note payable | 36,415,000 | |
Payments on note payable | (173,000) | (45,000) |
Proceeds from of line of credit | 11,968,000 | |
Payments made to line of credit | (284,000) | |
Distribution to non-controlling interest | (50,000) | |
Proceeds from issuance of common stock | 5,035,000 | 8,687,000 |
Proceeds from issuance of preferred stock | 2,556,000 | |
Distribution made to common stockholders | (161,000) | (10,000) |
Distribution made to preferred stockholders | (5,000) | |
Net cash provided by financing activities | 55,301,000 | 8,632,000 |
Net change in cash | (210,000) | 5,105,000 |
Cash, beginning of period | 4,885,000 | 2,268,000 |
Cash, end of period | 4,675,000 | 7,373,000 |
Supplemental disclosures of cash flow information: | ||
Interest Paid | 595,000 | 1,000 |
Non-cash investing and financing activities: | ||
Distributions - DRIP | 285,000 | 14,000 |
Deposits applied to purchase of investment in real estate | $ 4,000,000 |
Organization and Proposed Busin
Organization and Proposed Business Operations | 3 Months Ended |
Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, Proposed Business Operations and Capitalization | Note A — Organization and Proposed Business Operations MVP REIT II, Inc. (the “Company,” “we,” “us,” or “our”) is a Maryland corporation formed on May 4, 2015 and intends to qualify as a real estate investment trust (“REIT”) for U.S. federal income tax purposes upon the filing of the federal tax return for the year ended December 31, 2016. As of December 31, 2016, the Company ceased all selling efforts for the initial public offering (the “Common Stock Offering”) of its common stock, $0.0001 par value per share, at $25.00 per share, pursuant to a registration statement on Form S-11 filed with the U.S. Securities and Exchange Commission (the “SEC”) under the Securities Act of 1933, as amended. The Company accepted additional subscriptions through March 31, 2017, the last day of the Common Stock Offering. As of March 31, 2017, the Company raised approximately $61.1 million in the Common Stock Offering before payment of deferred offering costs of approximately $1.1 million, contribution from the Sponsor of approximately $1.1 million and cash distributions of approximately $435,000. The Company has also registered $50 million in shares of common stock for issuance pursuant to a distribution reinvestment plan (the “DRIP”) under which common stockholders may elect to have their distributions reinvested in additional shares of common stock at the current price of $25.00 per share. The Company was formed to focus primarily on investments in parking facilities, including parking lots, parking garages and other parking structures throughout the United States and Canada. No more than 10% of the proceeds of the Common Stock Offering will be used for investment in Canadian properties. The Company is the sole general partner of MVP REIT II Operating Partnership, LP, a Delaware limited partnership (the “Operating Partnership”). The Company intends to own substantially all of its assets and conduct its operations through the Operating Partnership. The Company’s wholly owned subsidiary, MVP REIT II Holdings, LLC, is the sole limited partner of the Operating Partnership. The operating agreement provides that the Operating Partnership is operated in a manner that enables the Company to (1) satisfy the requirements for being classified as a REIT for tax purposes, (2) avoid any federal income or excise tax liability, and (3) ensure that the Operating Partnership is not classified as a “publicly traded partnership” for purposes of Section 7704 of the Internal Revenue Code, which classification could result in the Operating Partnership being taxed as a corporation. We utilize an Umbrella Partnership Real Estate Investment Trust (“UPREIT”) structure to enable us to acquire real property in exchange for limited partnership interests in Operating Partnership from owners who desire to defer taxable gain that would otherwise normally be recognized by them upon the disposition of their real property or transfer of their real property to us in exchange for shares of common stock or cash. As part of the Company’s initial capitalization, we sold 8,000 shares of common stock for $200,000 to MVP Capital Partners II, LLC (the “Sponsor”), the sponsor of the Company. The Sponsor is owned 60% by Vestin Realty Mortgage II, Inc., a Maryland corporation and OTC pink sheet company (“VRM II”), and 40% by Vestin Realty Mortgage I, Inc., a Maryland corporation and OTC pink sheet company (“VRM I”), both which are managed by Vestin Mortgage, LLC, a Nevada limited liability company in which Michael Shustek wholly owns. The Company also sold 5,000 shares of common stock to VRM II in the Offering. The Company’s advisor is MVP Realty Advisors, LLC (the “Advisor”), a Nevada limited liability company, which is owned 60% by VRM II and 40% by VRM I. The Advisor is responsible for managing the Company’s affairs on a day-to-day basis and for identifying and making investments on the Company’s behalf pursuant to an advisory agreement between the Company and the Advisor (the “Advisory Agreement”). The Company has no paid employees. From inception through March 31, 2017, the Company has paid approximately $1.2 million in distributions, including issuing 29,731 shares of its common stock as DRIP, issuing 47,116 shares of its common stock as dividend in distributions to the Company’s common stockholders and $5,000 in distributions for preferred stockholders, all of which have been paid from offering proceeds and constituted a return of capital. The Company may pay distributions from sources other than cash flow from operations, including proceeds from the Offering and other stock sales, the sale of assets, or borrowings. The Company has no limits on the amounts it may pay from such sources. If the Company continues to pay distributions from sources other than cash flow from operations, the funds available to the Company for investments would be reduced and the share value may be diluted. Capitalization As of March 31, 2017, the Company had 2,521,088 shares of common stock issued and outstanding. During the three months ended March 31, 2017, the Company had received consideration of approximately $4.7 million for the issuance of its common stock in connection with the Common Stock Offering. In connection with its formation, the Company sold 8,000 shares of common stock to the Sponsor for $200,000. As of March 31, 2017, the Company had 2,862 shares of preferred stock issued and outstanding The Company offered up to $50 million in shares of the Company’s Series A Convertible Redeemable Preferred Stock (“Series A”), par value $0.0001 per share, together with warrants to acquire the Company’s common stock, in a Regulation D 506(c) private placement to accredited investors. In connection with the private placement, on October 27, 2016, the Company filed with the State Department of Assessments and Taxation of Maryland Articles Supplementary to the charter of the Company classifying and designating 50,000 shares of Series A Convertible Redeemable Preferred Stock. The Company commenced the private placement of the shares of Series A to accredited investors on November 1, 2016 and closed the offering on March 24, 2017. The Company raised approximately $2.6 million, net of offering costs , in the Series A private placements. As disclosed on an 8-K filed with the SEC on March 30, 2017, the Company filed with the State Department of Assessments and Taxation of Maryland Articles Supplementary to the charter of the Company classifying and designating 97,000 shares of its authorized capital stock as shares of Series 1 Convertible Redeemable Preferred Stock ("Series 1"), par value $0.0001 per share. The Company commenced the Regulation D 506(b) private placement of shares of Series 1 to accredited investors commencing April 7, 2017. As of May 9 XX Stockholders may elect to reinvest distributions received from the Company in common shares by participating in the Company’s DRIP. The stockholder may enroll in the DRIP by completing the distribution change form. The stockholder may also withdraw at any time, without penalty, by delivering written notice to the Company. Participants will acquire DRIP shares at a fixed price of $25.00 per share until (i) all such shares registered in the Offering are issued, (ii) the Offering terminates and the Company elects to deregister any unsold shares under the DRIP, or (iii) the Company’s board decides to change the purchase price for DRIP shares or terminate the DRIP for any reason. Commencing no later than May 29, 2018 (the “Valuation Date”), which is 150 days following the second anniversary of the date to satisfy the minimum offering requirement in the Offering, if the DRIP is ongoing, the Company will adjust the price of shares offered in the DRIP to equal the net asset value (“NAV”) per share. The Company will update the NAV per share at least annually following the Valuation Date and further adjust the per share price in the Company’s DRIP accordingly. The Company has registered $50,000,000 in shares for issuance under the DRIP. The Company may amend, suspend or terminate the DRIP for any reason, except that the Company may not amend the DRIP to eliminate a participant’s ability to withdraw from the DRIP, without first providing 10 days prior written notice to participants. In addition, the Company has a Share Repurchase Program (“SRP”) that may provide stockholders who generally have held their shares for at least two years an opportunity to sell their shares to the Company, subject to certain restrictions and limitations. Prior to the date that the Company establishes an estimated value per share of common stock, the purchase price will be 95.0% of the purchase price paid for the shares if redeemed at any time between the second and third anniversaries of the purchase date, and 97.0% of the purchase price paid if redeemed after the third anniversary. After the Company establishes an estimated NAV per share of common stock, the purchase price will be 95.0% of the NAV per share for the shares if redeemed at any time between the second and third anniversaries of the purchase date, 97.0% of the NAV per share if redeemed at any time between the third and fifth anniversaries, and 100.0% of the NAV per share if redeemed after the fifth anniversary. The number of shares to be repurchased during a calendar quarter is limited to the lesser of: (i) 5.0% of the weighted average number of shares of common stock outstanding during the prior calendar year, and (ii) those repurchases that can be funded from the net proceeds of the sale of shares under the DRIP in the prior calendar year plus such additional funds as may be reserved for that purpose by the Company’s board of directors; provided however, that the above volume limitations shall not apply to repurchases requested in connection with the death or qualifying disability of a stockholder. The board of directors may also limit the amounts available for repurchase at any time at its sole discretion. The SRP will terminate if the shares of common stock are listed on a national securities exchange. Redemption requests other than those made in connection with the death or disability (as defined in the Internal Revenue Code of 1986, as amended (the “Code”) of a stockholder will continue to be repurchased as of March 31 st th th st |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note B — Summary of Significant Accounting Policies Basis of Accounting The accompanying unaudited condensed consolidated financial statements of the Company are prepared by management on the accrual basis of accounting and in accordance with principles generally accepted in the United States of America (“GAAP”) for interim financial information as contained in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”), and in conjunction with rules and regulations of the SEC. Certain information and footnote disclosures required for annual financial statements have been condensed or excluded pursuant to SEC rules and regulations. Accordingly, the unaudited condensed consolidated financial statements do not include all of the information and footnotes required by GAAP for complete financial statements. The unaudited condensed consolidated financial statements include accounts and related adjustments, which are, in the opinion of management, of a normal recurring nature and necessary for a fair presentation of the Company’s financial position, results of operations and cash flows for the interim period. Operating results for the three months ended March 31, 2017 are not necessarily indicative of the results that may be expected for the year ending December 31, 2017. These unaudited condensed consolidated financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016. The condensed consolidated balance sheet as of December 31, 2016 contained herein has been derived from the audited financial statements as of December 31, 2016, but does not include all disclosures required by GAAP. Consolidation The Company’s consolidated financial statements include its accounts and the accounts of its subsidiaries, Operating Partnership and all of the following subsidiaries. All intercompany profits and losses, balances and transactions are eliminated in consolidation. West 9 th MVP San Jose 88 Garage, LLC MCI 1372 Street, LLC Cincinnati Race Street, LLC St. Louis Washington, LLC St. Paul Holiday Garage, LLC Louisville Station Broadway, LLC White Front Garage Partners, LLC Cleveland Lincoln Garage, LLC MVP Houston Jefferson Lot, LLC MVP Houston San Jacinto Lot, LLC MVP Detroit Center Garage, LLC St Louis Broadway, LLC St Louis Seventh & Cerre, LLC Under GAAP, the Company’s consolidated financial statements will also include the accounts of its consolidated subsidiaries and joint ventures in which the Company is the primary beneficiary, or in which the Company has a controlling interest. In determining whether the Company has a controlling interest in a joint venture and the requirement to consolidate the accounts of that entity, the Company’s management considers factors such as an entity’s purpose and design and the Company’s ability to direct the activities of the entity that most significantly impacts the entity’s economic performance, ownership interest, board representation, management representation, authority to make decisions, and contractual and substantive participating rights of the partners/members as well as whether the entity is a variable interest entity in which it will absorb the majority of the entity’s expected losses, if they occur, or receive the majority of the expected residual returns, if they occur, or both. Equity investments in which the Company exercises significant influence but does not control and is not the primary beneficiary are accounted for using the equity method. The Company's share of its equity method investees' earnings or losses is included in other income in the accompanying unadutied condensed consolidated statements of operations. Investments in which the Company is not able to exercise significant influence over the investee are accounted for under the cost method. 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 financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Management makes significant estimates regarding revenue recognition, purchase price allocations to record investments in real estate, and derivative financial instruments and hedging activities, as applicable. Concentration The Company had eight parking tenants as of March 31, 2017. One tenant, Standard Parking + (“SP+”), represented a concentration for the three months ended March 31, 2017, in regards to parking base rental revenue. During the three months ended March 31, 2017, SP+ accounted for 65%, of the parking base rental revenue. Below is a table that summarizes base parking rent by tenant: Parking Tenant Percentage of Total Base Rental Revenue (as of March 31, 2017) SP + 65.3% Premier Parking 9.3% Interstate Parking 7.1% ABM 5.1% iPark Services 4.7% St. Louis Parking 3.6% Riverside Parking 2.7% Lanier 2.2% Grand Total 100.00% Acquisitions The Company records the acquired tangible and intangible assets and assumed liabilities of acquisitions of all operating properties and those development and redevelopment opportunities that meet the accounting criteria to be accounted for as business combinations at fair value at the acquisition date. The Company assesses and considers fair value based on estimated cash flow projections that utilize available market information and discount and/or capitalization rates that the Company deems appropriate. Estimates of future cash flows are based on a number of factors including historical operating results, known and anticipated trends, and market and economic conditions. The acquired assets and assumed liabilities for an operating property acquisition generally include but are not limited to: land, buildings and improvements, construction in progress and identified tangible and intangible assets and liabilities associated with in-place leases, including tenant improvements, leasing costs, value of above-market and below-market operating leases and ground leases, acquired in-place lease values and tenant relationships, if any. The fair value of land is derived from comparable sales of land within the same submarket and/or region. The fair value of buildings and improvements, tenant improvements, and leasing costs are based upon current market replacement costs and other relevant market rate information. The fair value of the above-market or below-market component of an acquired in-place operating lease is based upon the present value (calculated using a market discount rate) of the difference between (i) the contractual rents to be paid pursuant to the lease over its remaining non-cancellable lease term and (ii) management's estimate of the rents that would be paid using fair market rental rates and rent escalations at the date of acquisition measured over the remaining non-cancellable term of the lease for above-market operating leases and the initial non-cancellable term plus the term of any below-market fixed rate renewal options, if applicable, for below-market operating leases. The amounts recorded for above-market operating leases are included in deferred leasing costs and acquisition-related intangibles, net on the balance sheet and are amortized on a straight-line basis as a reduction of rental income over the remaining term of the applicable leases. The amounts recorded for below-market operating leases are included in deferred revenue and acquisition-related liabilities, net on the balance sheet and are amortized on a straight-line basis as an increase to rental income over the remaining term of the applicable leases plus the term of any below-market fixed rate renewal options, if applicable. The Company’s below-market operating leases generally do not include fixed rate or below-market renewal options. The fair value of acquired in-place leases is derived based on management's assessment of lost revenue and costs incurred for the period required to lease the “assumed vacant” property to the occupancy level when purchased. This fair value is based on a variety of considerations including, but not necessarily limited to: (1) the value associated with avoiding the cost of originating the acquired in-place leases; (2) the value associated with lost revenue related to tenant reimbursable operating costs estimated to be incurred during the assumed lease-up period; and (3) the value associated with lost rental revenue from existing leases during the assumed lease-up period. Factors considered by the Company in performing these analyses include an estimate of the carrying costs during the expected lease-up periods, current market conditions, and costs to execute similar leases. In estimating carrying costs, the Company includes real estate taxes, insurance and other operating expenses, and estimates of lost rental revenue during the expected lease-up periods based on current market demand at market rates. In estimating costs to execute similar leases, the Company considers leasing commissions, legal and other related expenses. The amount recorded for acquired in-place leases is included in deferred leasing costs and acquisition-related intangibles, net on the balance sheet and amortized as an increase to depreciation and amortization expense over the remaining term of the applicable leases. If a lease were to be terminated or if termination were determined to be likely prior to its contractual expiration (for example resulting from bankruptcy), amortization of the related unamortized in-place lease intangible would be accelerated. The determination of the fair value of any debt assumed in connection with a property acquisition is estimated by discounting the future cash flows using interest rates available for the issuance of debt with similar terms and remaining maturities. The determination of the fair value of the acquired tangible and intangible assets and assumed liabilities of operating property acquisitions requires us to make significant judgments and assumptions about the numerous inputs discussed above. The use of different assumptions in these fair value calculations could significantly affect the reported amounts of the allocation of the Company’s acquisition related assets and liabilities and the related amortization and depreciation expense recorded for such assets and liabilities. In addition, because the value of above and below market leases are amortized as either a reduction or increase to rental income, respectively, the Company’s judgments for these intangibles could have a significant impact on the Company’s reported rental revenues and results of operations. Costs directly associated with all operating property acquisitions and those development and redevelopment acquisitions that meet the accounting criteria to be accounted for as business combinations are expensed as incurred. During the three months ended March 31, 2017, the Company expensed approximately $1.1 million in related party acquisition costs and $1.8 million of non-related party acquisition costs, for the purchase of an interest in three properties. During the three months ended March 31, 2016, the Company did not acquire any properties. The Company’s acquisition expenses are directly related to the Company’s acquisition activity and if the Company’s acquisition activity was to increase or decrease, so would the Company’s acquisition costs. Impairment of Long Lived Assets When circumstances indicate the carrying value of a property may not be recoverable, the Company reviews the asset for impairment. This review is based on an estimate of the future undiscounted cash flows, excluding interest charges, expected to result from the property’s use and eventual disposition. These estimates consider factors such as expected future operating income, market and other applicable trends and residual value, as well as the effects of leasing demand, competition and other factors. If impairment exists, due to the inability to recover the carrying value of a property, an impairment loss is recorded to the extent that the carrying value exceeds the estimated fair value of the property for properties to be held and used. For properties held for sale, the impairment loss is the adjustment to fair value less estimated cost to dispose of the asset. These assessments have a direct impact on net income because recording an impairment loss results in an immediate negative adjustment to net income. Cash Cash includes cash in bank accounts. The Company deposits cash with high quality financial institutions. These deposits are guaranteed by the Federal Deposit Insurance Company up to an insurance limit up of $250,000. As of March 31, 2017 and December 31, 2016, the Company had approximately $2.7 million and $3.4 million, respectively, in excess of the federally insured limits. Restricted Cash Restricted cash primarily consists of escrowed tenant improvement funds, real estate taxes, capital improvement funds, insurance premiums, and other amounts required to be escrowed pursuant to loan agreements. Revenue Recognition The Company's revenues, which are derived primarily from rental income, include rents that each tenant pays in accordance with the terms of each lease reported on a straight-line basis over the initial term of the lease. Since many of the Company's leases will provide for rental increases at specified intervals, straight-line basis accounting requires the Company to record a receivable, and include in revenues, unbilled rent receivables that the Company will only receive if the tenant makes all rent payments required through the expiration of the initial term of the lease. The Company will continually review receivables related to rent and unbilled rent receivables and determine 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 in doubt, the Company will record an increase in the Company's allowance for uncollectible accounts or record a direct write-off of the receivable after exhaustive efforts at collection. Advertising Costs Advertising costs incurred in the normal course of operations and are expensed as incurred. During the three months ended March 31, 2017 and 2016, the Company had no advertising costs. Investments in Real Estate and Fixed Assets Investments in real estate and fixed assets are stated at cost less accumulated depreciation. Depreciation is provided principally on the straight-line method over the estimated useful lives of the assets, which are primarily 3 to 40 years. The cost of repairs and maintenance is charged to expense as incurred. Expenditures for property betterments and renewals are capitalized. Upon sale or other disposition of a depreciable asset, cost and accumulated depreciation are removed from the accounts and any gain or loss is reflected in other income (expense). The Company periodically evaluates whether events and circumstances have occurred that may warrant revision of the estimated useful lives of fixed assets or whether the remaining balance of fixed assets should be evaluated for possible impairment. The Company uses an estimate of the related undiscounted cash flows over the remaining life of the fixed assets in measuring their recoverability. Purchase Price Allocation The Company allocates the purchase price of acquired properties to tangible and identifiable intangible assets acquired based on their respective fair values. Tangible assets include land, land improvements, buildings, fixtures and tenant improvements on an as-if vacant basis. The Company utilizes various estimates, processes and information to determine the as-if vacant property value. Estimates of value are made using customary methods, including data from appraisals, comparable sales, discounted cash flow analysis and other methods. Amounts allocated to land, land improvements, buildings and fixtures are based on cost segregation studies performed by independent third parties or on the Company's analysis of comparable properties in the Company's portfolio. Identifiable intangible assets include amounts allocated to acquire leases for above- and below-market lease rates, the value of in-place leases, and the value of customer relationships, as applicable. The aggregate value of intangible assets related to in-place leases is primarily the difference between the property valued with existing in-place leases adjusted to market rental rates and the property valued as if vacant. Factors considered by the Company in its analysis of the in-place lease intangibles include an estimate of carrying costs during the expected lease-up period for each property, taking into account current market conditions and costs to execute similar leases. In estimating carrying costs, the Company will include real estate taxes, insurance and other operating expenses and estimates of lost rentals at market rates during the expected lease-up period. Estimates of costs to execute similar leases including leasing commissions, legal and other related expenses are also utilized. Above-market and below-market in-place lease values for owned properties are recorded based on the present value (using an interest rate which reflects the risks associated with the leases acquired) of the difference between the contractual amounts to be paid pursuant to the in-place leases and management’s estimate of fair market lease rates for the corresponding in-place leases, measured over a period equal to the remaining non-cancelable term of the lease. The capitalized above-market lease intangibles are amortized as a decrease to rental income over the remaining term of the lease. The capitalized below-market lease values will be amortized as an increase to rental income over the remaining term and any fixed rate renewal periods provided within the respective leases. In determining the amortization period for below-market lease intangibles, the Company initially will consider, and periodically evaluate on a quarterly basis, the likelihood that a lessee will execute the renewal option. The likelihood that a lessee will execute the renewal option is determined 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. The aggregate value of intangible assets related to customer relationship, as applicable, is measured based on the Company's evaluation of the specific characteristics of each tenant’s lease and the Company's overall relationship with the tenant. Characteristics considered by the Company in determining these values include the nature and extent of its existing business relationships with the tenant, growth prospects for developing new business with the tenant, the tenant’s credit quality and expectations of lease renewals, among other factors. The value of in-place leases is amortized to expense over the initial term of the respective leases. The value of customer relationship intangibles is amortized to expense over the initial term and any renewal periods in the respective leases, but in no event does the amortization period for intangible assets exceed the remaining depreciable life of the building. If a tenant terminates its lease, the unamortized portion of the in-place lease value and customer relationship intangibles is charged to expense. In making estimates of fair values for purposes of allocating purchase price, the Company will utilize a number of sources, including independent appraisals that may be obtained in connection with the acquisition or financing of the respective property and other market data. The Company will also consider information obtained about each property as a result of the Company's pre-acquisition due diligence, as well as subsequent marketing and leasing activities, in estimating the fair value of the tangible and intangible assets acquired and intangible liabilities assumed. Organization, Offering and Related Costs Certain organization and offering costs will be incurred by the Advisor. Pursuant to the terms of the Advisory Agreement, the Company will not reimburse the Advisor for these out of pocket costs and future organization and offering costs it may incur. Such costs shall include legal, accounting, printing and other offering expenses, including marketing, and direct expenses of the Advisor’s employees and employees of the Advisor’s affiliates and others. All direct offering costs incurred and or paid by us that are directly attributable to a proposed or actual offering, including sales commissions, if any, were charged against the gross proceeds of the Offering and recorded as an offset to additional paid-in-capital. All indirect costs will be expensed as incurred. Offering costs were reclassified from deferred costs to stockholders’ equity when the Company commenced its Offering, and included all expenses incurred by the Company in connection with its Offering as of such date. Stock-Based Compensation The Company has a stock-based incentive award plan, which is accounted for under the guidance for share based payments. The expense for such awards will be included in general and administrative expenses and is recognized over the vesting period or when the requirements for exercise of the award have been met (See Note G — Stock-Based Compensation). Income Taxes The Company will elect and operate in a manner that will allow the Company, to qualify to be taxed as a REIT under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended, commencing with the taxable year ended December 31, 2016. If the Company qualifies for taxation as a REIT, it generally will not be subject to federal corporate income tax to the extent it distributes all of its REIT taxable income to its stockholders, and so long as it distributes at least 90% of its REIT taxable income. REITs are subject to a number of other organizational and operational requirements. Even if the Company qualifies to be taxed as a REIT, it may be subject to certain state and local taxes on its income and property, and federal income and excise taxes on its undistributed income. Per Share Data The Company calculates basic income (loss) per share by dividing net income (loss) for the period by weighted-average shares of its common stock outstanding for the respective period. Diluted income per share takes into account the effect of dilutive instruments, such as stock options and convertible stock, but uses the average share price for the period in determining the number of incremental shares that are to be added to the weighted-average number of shares outstanding. The Company had no outstanding common share equivalents during the three months ended March 31, 2017 and 2016. Reportable Segments We currently operate one reportable segment. Accounting and Auditing Standards Applicable to “Emerging Growth Companies” The Company is an “emerging growth company” under the Jumpstart Our Business Startups Act (the “JOBS Act”). For as long as the Company remains an “emerging growth company,” which may be up to five fiscal years, the Company is not required to (1) comply with any new or revised financial accounting standards that have different effective dates for public and private companies until those standards would otherwise apply to private companies, (2) provide an auditor’s attestation report on management’s assessment of the effectiveness of internal control over financial reporting pursuant to Section 404 of the Sarbanes-Oxley Act, (3) comply with any new requirements adopted by the Public Company Accounting Oversight Board, or the PCAOB, requiring mandatory audit firm rotation or a supplement to the auditor’s report in which the auditor would be required to provide additional information about the audit and the financial statements of the issuer or (4) comply with any new audit rules adopted by the PCAOB after April 5, 2012, unless the SEC determines otherwise. The Company intends to take advantage of such extended transition period. Since the Company will not be required to comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for other public companies, the Company’s financial statements may not be comparable to the financial statements of companies that comply with public company effective dates. If the Company were to subsequently elect to instead comply with these public company effective dates, such election would be irrevocable pursuant to Section 107 of the JOBS Act. Share Repurchase Program The Company has a Share Repurchase Program (“SRP”) that enables stockholders to sell their shares to the Company. Under the SRP, stockholders may request that the Company redeem all or any portion, subject to certain minimum conditions described below, if such repurchase does not impair the Company's capital or operations. Prior to the time that the Company’s shares are listed on a national securities exchange, the repurchase price per share will depend on the length of time investors have held such shares as follows: no repurchases for the first two years unless shares are being repurchased in connection with a stockholder’s death or disability (as defined in the Code). Repurchase requests made in connection with the death or disability of a stockholder will be repurchased at a price per share equal to 100% of the amount the stockholder paid for each share, or once we have established an estimated NAV per share, 100% of such amount as determined by the Company’s board of directors, subject to any special distributions previously made to the Company’s stockholders. With respect to all other repurchases, prior to the date that we establish an estimated value per share of common stock, the purchase price will be 95.0% of the purchase price paid for the shares, if redeemed at any time between the second and third anniversaries of the purchase date, and 97.0% of the purchase price paid if redeemed after the third anniversary. After we establish an estimated NAV per share of common stock, the purchase price will be 95.0% of the NAV per share for the shares, if redeemed at any time between the second and third anniversaries of the purchase date, 97.0% of the NAV per share if redeemed at any time between the third and fifth anniversaries, and 100.0% of the NAV per share if redeemed after the fifth anniversary. In the event that the Company does not have sufficient funds available to repurchase all of the shares for which repurchase requests have been submitted in any quarter, we will repurchase the shares on a pro rata basis on the repurchase date. The SRP will be terminated if the Company’s shares become listed for trading on a national securities exchange or if the Company’s board of directors determines that it is in the Company’s best interest to terminate the SRP. The Company is not obligated to repurchase shares of common stock under the share repurchase program. The number of shares to be repurchased during the calendar quarter is limited to the lesser of: (i) 5% of the weighted average number of shares outstanding during the prior calendar year, and (ii) those repurchases that could be funded from the net proceeds of the sale of shares under the DRIP in the prior calendar year plus such additional funds as may be reserved for that purpose by the Company’s board of directors; provided, however, that the above volume limitations shall not apply to repurchases requested in connection with the death or qualifying disability of a stockholder. Because of these limitations, the Company cannot guarantee that the Company will be able to accommodate all repurchase requests. The Company will repurchase shares as of March 31 st th th st On October 27, 2016, the Company filed a Form 8-K announcing, among other things, an amendment to the SRP providing for participation in the SRP by any holder of the Company's Series A Convertible Redeemable Preferred Stock, or any future board-authorized series or class of preferred stock that is convertible into common stock of the Company. Under the amendment, which becomes effective on November 26, 2016, a preferred stock holder may participate in the SRP by converting its preferred stock into common stock of the Company, and submitting such common shares for repurchase. The time period, for purposes of determining how long such stockholder has held the common shares submitted for repurchase, begins as of the date such preferred stockholder acquired the underlying preferred shares that were converted into common shares and submitted for repurchase. The board of directors may, in its sole discretion, terminate, suspend or further amend the share repurchase program upon 30 days’ written notice without stockholder approval if it determines that the funds available to fund the share repurchase program are needed for other business or operational purposes or that amendment, suspension or termination of the share repurchase program is in the best interest of the stockholders. Among other things, we may amend the plan to repurchase shares at prices different from those described above for the purpose of ensuring the Company’s dividends are not “preferential” for incomes tax purposes. Any notice of a termination, suspension or amendment of the share repurchase program will be made via a report on Form 8-K filed with the SEC at least 30 days prior to the effective date of such termination, suspension or amendment. The board of directors may also limit the amounts available for repurchase at any time in its sole discretion. Notwithstanding the foregoing, the share repurchase program will terminate if the shares of common stock are listed on a national securities exchange. As of March 31, 2017, no shares are eligible for redemption (other than in connection with a death or disability of a stockholder). Distribution Reinvestment Plan Pursuant to the DRIP stockholders may elect to reinvest distributions by purchasing shares of common stock in lieu of receiving cash. No dealer manager fees or selling commissions are paid with respect to shares purchased pursuant to the DRIP. Participants purchasing shares pursuant to the DRIP have the same rights and are treated in the same manner as if such shares were issued pursuant to the Offering. The board of directors may designate that certain cash or other distributions be excluded from the DRIP. The Company has the right to amend any aspect of the DRIP or terminate the DRIP with ten days’ notice to participants. Shares issued under the DRIP are recorded to equity in the accompanying balance sheets in the period distributions are declared. We have issued a total of 29,731shares of common stock under the DRIP as of March 31, 2017. Non-controlling Interests The FASB issued authoritative guidance for non-controlling interests in December 2007, which establishes accounting and reporting standards for the non-controlling interest in a subsidiary and for the deconsolidation of a subsidiary. The guidance clarifies that a non-controlling interest in a subsidiary, which is sometimes referred to as an unconsolidated investment, is an ownership interest in the consolidated entity that should be reported as a component of equity in the consolidated financial statements. Among other requirements, the guidance requires consolidated net income to be reported at amounts attributable to both the parent and the non-controlling interest. It also requires disclosure, on the face of the consolidated income statement, of the amounts of consolidated net income attributable to the parent and to the non-controlling interest. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note C — Commitments and Contingencies Litigation In the ordinary course of business, the Company may become subject to litigation or claims. There are no material legal proceedings pending or known to be contemplated against the Company. Environmental Matters As an owner of real estate, we are subject to various environmental laws of federal, state and local governments. We do not believe that compliance with existing laws will have a material adverse effect on financial condition or results of operations. However, we cannot predict the impact of any unforeseen environmental contingencies or new or changed laws or regulations on properties in which we hold an interest, or on properties that may be acquired directly or indirectly in the future. |
Investments in Real Estate
Investments in Real Estate | 3 Months Ended |
Mar. 31, 2017 | |
Banking and Thrift [Abstract] | |
Investments in Real Estate | Note D – Investments in Real Estate As of March 31, 2017, the Company had the following Investments in Real Estate: Property Location Date Acquired Investment Amount Zoning Height Restriction Parking Tenant Lease Commencement Date MVP San Jose 88 Garage, LLC San Jose, CA 6/15/2016 $3,575,000 DC N/A Lanier Parking 3/01/2017 MCI 1372 Street, LLC Canton, OH 7/8/2016 $700,000 B-5 375 FT ABM 7/8/2016 MVP Cincinnati Race Street Garage, LLC Cincinnati, OH 7/8/2016 $4,500,000 DD-A 500 FT. SP + 9/1/2016 MVP St. Louis Washington, LLC St Louis, MO 7/18/2016 $3,000,000 CBD I 100 FT. SP + 7/21/2016 MVP St. Paul Holiday Garage, LLC St Paul, MN 8/12/2016 $8,200,000 B-5 Unlimited Interstate Parking 8/12/2016 MVP Louisville Station Broadway, LLC Louisville, KY 8/23/2016 $3,050,000 CBD I Unlimited Riverside Parking 8/23/2016 Cleveland Lincoln Garage Owners, LLC Cleveland, OH 10/19/2016 $7,331,000 SI-E5 / GR-E5 250 FT. SP + 10/25/2016 MVP Houston San Jacinto Lot, LLC Houston, TX 11/22/2016 $3,200,000 NONE Unlimited iPark Services 12/1/2016 White Front Garage Partners, LLC Nashville, TN 9/30/2016 $11,496,000 CBD I Unlimited Premier Parking 10/1/2016 West 9 th Cleveland, OH 5/11/2016 $5,675,000 CBD LLR-B4 175 FT. SP + 5/11/2016 33740 Crown Colony, LLC Cleveland, OH 5/17/2016 $3,030,000 LLR-D5 250 FT. SP + 5/17/2016 MVP Detroit Center Garage, LLC Detroit, MI 01/10/2017 $55,000,000 PD Unlimited SP + 2/1/2017 St Louis Broadway, LLC St Louis, MO 02/01/2017 $2,400,000 CBD I 200 FT. St Louis Parking Co 2/1/2017 St Louis Seventh & Cerre, LLC St Louis, MO 02/01/2017 $3,300,000 CBD I 200 FT. St Louis Parking Co 2/1/2017 114,457,000 |
Related Party Transactions and
Related Party Transactions and Arrangements | 3 Months Ended |
Mar. 31, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions and Arrangements | Note E — Related Party Transactions and Arrangements The transactions described in this Note were approved by a majority of the Company’s board of directors (including a majority of the independent directors) not otherwise interested in such transaction as fair and reasonable to the Company and on terms and conditions no less favorable to the Company than those available from unaffiliated third parties. Ownership of Company Stock As of March 31, 2017, the Company’s Sponsor owned 8,000 shares and VRM II owned 5,000 shares of the Company’s outstanding common stock. Ownership of MVP REIT On November 5, 2016, the Company purchased 338,409 shares of MVP REIT common stock from an unrelated third party for $3.0 million or $8.865 per share. During the three months ended March 31, 2017, MVP REIT paid us, approximately $52,000 in stock distributions, related to the Company’s ownership of their common stock. Ownership of the Advisor VRM I and VRM II own 40% and 60%, respectively, of the Advisor. Neither VRM I nor VRM II paid any up-front consideration for these ownership interests, but each will be responsible for its proportionate share of future expenses of the Advisor. The operating agreement of the Advisor provides that once VRM I and VRM II have been repaid in full for any capital contributions to the Advisor or for any expenses advanced on the Advisor’s behalf, or capital investment, and once they have received an annualized return on their capital investment of 7.5%, then Michael Shustek will receive 40% of the net profits of the Advisor. Fees Paid in Connection with the Offering – Common Stock Various affiliates of the Company are involved in this offering and the Company’s operations including MVP American Securities, LLC, or (“MVP American Securities”), which is a broker-dealer and member of the Financial Industry Regulatory Authority, Inc., or FINRA. MVP American Securities is owned by MS MVP Holdings, LLC which is owned and managed by Mr. Shustek. Additionally, the Company’s board of directors, including a majority of the Company’s independent directors, may engage an affiliate of the Advisor to perform certain property management services for us. The Company’s Sponsor or its affiliates will pay selling commissions of up to 6.5% of gross offering proceeds from the sale of shares in the primary offering without any right to seek reimbursement from the Company. The Company’s sponsor or its affiliates also may pay non-affiliated selling agents a one-time fee separately negotiated with each selling agent for due diligence expenses, subject to the total underwriting compensation limitation set forth below. We expect such due diligence expenses to average up to 1% of total offering proceeds at the maximum offering amount. Such commissions and fees will be paid by sponsor or its affiliates (other than the Company) without any right to seek reimbursement from company. Fees Paid in Connection with the Offering – Preferred Stock In connection with the private placement of the Series A and Series 1 preferred stock, the Company may pay selling commissions of up to 6.0% of gross offering proceeds from the sale of shares in the private placements, including sales by affiliated and non-affiliated selling agents. The Company Fees Paid in Connection with the Operations of the Company The Advisor or its affiliates will receive an acquisition fee of 2.25% of the purchase price of any real estate provided, however, the Company will not pay any fees when acquiring loans from affiliates. During the three months ended March 31, 2017 and 2016, approximately $1.1 million and approximately $0.1 million in acquisition fees had been earned by the Advisor. The Advisor or its affiliates will be reimbursed for actual expenses paid or incurred in the investment. During the three months ended March 31, 2017 and 2016, no acquisition expenses had been reimbursed to the Advisor. The Advisor or its affiliates will receive a monthly asset management fee at an annual rate equal to 1.0% of the cost of all assets then held by the Company, or the Company’s proportionate share thereof in the case of an investment made through a joint venture or other co-ownership arrangement. The Company will determine the Company’s NAV, on a date not later than the Valuation Date. Following the Valuation Date, the asset management fee will be based on the value of the Company’s assets rather than their historical cost. Asset management fees for the three months ended March 31, 2017 were approximately $237,000. No asset management fees were earned for the three months ended March 31, 2016. The Company will reimburse the Advisor or its affiliates for costs of providing administrative services, subject to the limitation that we will not reimburse the Advisor for any amount by which the Company’s operating expenses, at the end of the four preceding fiscal quarters (commencing after the quarter in which we make the Company’s first investment), exceed the greater of (a) 2.0% of average invested assets and (b) 25.0% of net income connection with the selection or acquisition of an investment, whether or not the Company ultimately acquires, unless the excess amount is approved by a majority of the Company’s independent directors. We will not reimburse the Advisor for personnel costs in connection with services for which the Advisor receives a separate fee, such as an acquisition fee, disposition fee or debt financing fee, or for the salaries and benefits paid to the Company’s executive officers. In addition, we will not reimburse the Advisor for rent or depreciation, utilities, capital equipment or other costs of its own administrative items. During the three months ended March 31, 2017 and 2016, no operating expenses have been incurred by the Advisor. Fees Paid in Connection with the Liquidation or Listing of the Company’s Real Estate Assets For substantial assistance in connection with the sale of investments, as determined by the independent directors, we will pay the Advisor or its affiliate the lesser of (i) 3.0% of the contract sale price of each real estate-related secured loan or other real estate investment or (ii) 50% of the customary commission which would be paid to a third-party broker for the sale of a comparable property. The amount paid, when added to the sums paid to unaffiliated parties, may not exceed either the customary commission or an amount equal to 6.0% of the contract sales price. The disposition fee will be paid concurrently with the closing of any such disposition of all or any portion of any asset. During the three months ended March 31, 2017 and 2016, no disposition fees have been earned by the Advisor. After the Company’s stockholders have received a return of their net capital invested and a 6.0% annual cumulative, non-compounded return, then the Company’s Advisor will be entitled to receive 15.0% of the remaining proceeds. We will pay this subordinated performance fee only upon one of the following events: (i) if the Company’s shares are listed on a national securities exchange; (ii) if the Company’s assets are sold or liquidated; (iii) upon a merger, share exchange, reorganization or other transaction pursuant to which the Company’s investors receive cash or publicly-traded securities in exchange for their shares; or (iv) upon termination of the Company’s advisory agreement. During the three months ended March 31, 2017 and 2016, no subordinated performance fees have been earned by the Company’s Advisor. |
Economic Dependency
Economic Dependency | 3 Months Ended |
Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Economic Dependency | Note F — Economic Dependency Under various agreements, the Company has engaged or will engage the Advisor and 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 services, the sale of shares of the Company’s common stock available for issue, as well as other administrative responsibilities for the Company including accounting services and investor relations. In addition, the Sponsor pays selling commissions in connection with the sale of the Company’s shares in the Offering and the Advisor pays the Company’s organization and offering expenses. As a result of these relationships, the Company is dependent upon the Advisor and its affiliates. In the event that these companies are unable to provide the Company with the respective services, the Company will be required to find alternative providers of these services. |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | Note G — Stock-Based Compensation Long-Term Incentive Plan The Company’s board of directors has adopted a long-term incentive plan which we will use to attract and retain qualified directors, officers, employees, and consultants. The Company’s long-term incentive plan will offer these individuals an opportunity to participate in the Company’s growth through awards in the form of, or based on, the Company’s common stock. We currently anticipate that we will not issue awards under the Company’s long-term incentive plan, although we may do so in the future, including to the Company’s independent directors as a form of compensation. The long-term incentive plan authorizes the granting of restricted stock, stock options, stock appreciation rights, restricted or deferred stock units, dividend equivalents, other stock-based awards and cash-based awards to directors, officers, employees and consultants of the Company and the Company’s affiliates’ selected by the board of directors for participation in our long-term incentive plan. Stock options granted under the long-term incentive plan will not exceed an amount equal to 10% of the outstanding shares of our common stock on the date of grant of any such stock options. Stock options may not have an exercise price that is less than the fair market value of a share of our common stock on the date of grant. Our board of directors or a committee appointed by our board of directors will administer the long-term incentive plan, with sole authority to determine all of the terms and conditions of the awards, including whether the grant, vesting or settlement of awards may be subject to the attainment of one or more performance goals. No awards will be granted under the long-term incentive plan if the grant or vesting of the awards would jeopardize our status as a REIT under the Code or otherwise violate the ownership and transfer restrictions imposed under our charter. Unless otherwise determined by our board of directors, no award granted under the long-term incentive plan will be transferable except through the laws of descent and distribution. We have authorized and reserved an aggregate maximum number of 500,000 shares for issuance under the long-term incentive plan. In the event of a transaction between our company and our stockholders that causes the per-share value of our common stock to change (including, without limitation, any stock dividend, stock split, spin-off, rights offering or large nonrecurring cash dividend), the share authorization limits under the long-term incentive plan will be adjusted proportionately and the board of directors will make such adjustments to the long-term incentive plan and awards as it deems necessary, in its sole discretion, to prevent dilution or enlargement of rights immediately resulting from such transaction. In the event of a stock split, a stock dividend or a combination or consolidation of the outstanding shares of common stock into a lesser number of shares, the authorization limits under the long-term incentive plan will automatically be adjusted proportionately and the shares then subject to each award will automatically be adjusted proportionately without any change in the aggregate purchase price. Our board of directors may in its sole discretion at any time determine that all or a portion of a participant’s awards will become fully vested. The board may discriminate among participants or among awards in exercising such discretion. The long-term incentive plan will automatically expire on the tenth anniversary of the date on which it is approved by our board of directors and stockholders, unless extended or earlier terminated by our board of directors. Our board of directors may terminate the long-term incentive plan at any time. The expiration or other termination of the long-term incentive plan will not, without the participant’s consent, have an adverse impact on any award that is outstanding at the time the long-term incentive plan expires or is terminated. Our board of directors may amend the long-term incentive plan at any time, but no amendment will adversely affect any award without the participant’s consent and no amendment to the long-term incentive plan will be effective without the approval of our stockholders if such approval is required by any law, regulation or rule applicable to the long-term incentive plan. During the three months ended March 31, 2017, no grants have been made under the long-term incentive plan. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Changes and Error Corrections [Abstract] | |
Recent Accounting Pronouncements | Note H – Recent Accounting Pronouncements In March 2016, the FASB issued ASU No. 2016-07, Investments - Equity Method and Joint Ventures (Topic 323): Simplifying the Transition to the Equity Method of Accounting In March 2016, the FASB issued ASU No. 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting In August 2016, the FASB issued ASU No. 2016-15, Classification of Certain Cash Receipts and Cash Payments |
Acquisitions
Acquisitions | 3 Months Ended |
Mar. 31, 2017 | |
Business Combinations [Abstract] | |
Acquisitions | Note I - Acquisitions The following table is a summary of the acquisitions for the three months ended March 31, 2017. Property Location Date Acquired Property Type # Spaces Size / Acreage Retail /Office Square Ft. Investment Amount Ownership % MVP Detroit Center Garage Detroit, MI 01/10/2017 Garage 1,275 8.78 N/A $55,000,000 80.00% St Louis Broadway, LLC St Louis, MO 02/01/2017 Lot 161 0.96 N/A $2,400,000 100.00% St Louis Seventh & Cerre, LLC St Louis, MO 02/01/2017 Lot 174 1.20 N/A $3,300,000 100.00% Assets Liabilities Land and Improvements Building and improvements Total assets acquired Notes Payable Net assets and liabilities acquired MVP Detroit Center Garage 7,000,000 48,000,000 55,000,000 31,500,000 23,500,000 St Louis Broadway, LLC 2,400,000 -- 2,400,000 -- 2,400,000 St Louis Seventh & Cerre, LLC 3,300,000 -- 3,300,000 -- 3,300,000 $ 12,700,000 $ 48,000,000 $ 60,700,000 $ 31,500,000 $ 29,200,000 Pro forma results of the Company The following table of pro forma consolidated results of operations of the Company for the three months ended March 31, 2017 and 2016, and assumes that the acquisitions were completed as of January 1, 2016 March 31, 2017 March 31, 2016 Revenues from continuing operations $ 2,152,000 $ 958,000 Net income (loss) available to common stockholders $ (2,809,000) $ 696,000 Net income (loss) available to common stockholders per share – basic $ (2.09) $ 3.04 Net income (loss) available to common stockholders per share – diluted $ (2.09) $ 3.04 |
Line of Credit
Line of Credit | 3 Months Ended |
Mar. 31, 2017 | |
Debt Disclosure [Abstract] | |
Line of Credit | Note J — Line of Credit On October 5, 2016, the Company, through its Operating Partnership, and MVP REIT, (the “REITs”) through a wholly owned subsidiary (the "Borrowers"), entered into a credit agreement (the "Unsecured Credit Agreement") with KeyBank, National Association ('KeyBank") as the administrative agent and KeyBank Capital Markets ("KeyBank Capital Markets") as the lead arranger. Pursuant to the Unsecured Credit Agreement, the Borrowers were provided with a $30 million unsecured credit facility (the "Unsecured Credit Facility"), which may be increased up to $100 million, in minimum increments of $10 million. The Unsecured Credit Facility has an initial term of two years, maturing on October 5, 2018, and may be extended for a one-year period if certain conditions are met and upon payment of an extension fee. The Unsecured Credit Facility has an interest rate calculated based on LIBOR Rate plus 2.25% or Base Rate plus 1.25%, both as provided in the Unsecured Credit Agreement. The Base Rate is calculated as the greater of (i) the KeyBank Prime rate or (ii) the Federal Funds rate plus ½ of 1%. Payments under the Unsecured Credit Facility are interest only and are due on the first day of each quarter. The obligations of the Borrowers of the Unsecured Credit Agreement are joint and several. The REITs have entered into cross-indemnification provisions with respect to their joint and several obligations under the Unsecured Credit Agreement. As of March 31, 2017, the REITs had 15 properties listed on the line of credit, which provided an available draw of approximately $28 million, and had drawn approximately $27.9 million, of which our portion of the current draw was approximately $19.7 million, based on our pro-rate ownership of the properties listed on the line of credit. Based on the 15 properties on the line of credit as of March 31, 2017, the REITs had an additional draw of approximately $145,000. For the three months ended March 31, 2017, we had accrued approximately $139,000 in interest expense, amortized approximately $36,000 in loan fees and $1,500 in unused line fees associated with our draw. |
Notes Payable
Notes Payable | 3 Months Ended |
Mar. 31, 2017 | |
Debt Disclosure [Abstract] | |
Notes Payable | Note K — Notes Payable During October 2016, West 9 th In November 2016, we financed a 12-month insurance policy for Directors and Officers liability, with an annual interest rate of 3.8%. The agreement required a down payment of $25,000 and nine monthly payments of $14,000 beginning on November 3, 2016. During January 2017, t he Company and MVP REIT, through MVP Detroit Center Garage, LLC, entered into a secured Loan Agreement with Bank of America, N.A. to fund a portion of the purchase price for a multi-level parking garage in Detroit, Michigan. The Loan Agreement is for a 10-year term, has an annual interest rate of 5.52% and in payable in monthly installments of principal and interest totaling approximately $253,000 and maturing in February 2027. During January 2017, the MVP San Jose 88 Garage issued a promissory note to Owens Realty Mortgage for approximately $2.2 million. The note is collateralized by real property located in San Jose, California, bears an annual interest rate of 7.75%, and is payable in monthly installment payments of interest only totaling approximately $14000, maturing in January 2019. During January 2017, MVP Cincinnati Race Street Garage issued a promissory note to Moonshell, LLC for approximately $3.0 million. The note is collateralized by real property located in Cincinnati, Ohio, and bears an annual interest rate of 9%. Loan fees and interest, for the term of the loan, were paid at closing, there are no payments due until the loan matures in July 2017. During, April 2017, this loan was extended for an additional three months for an extension fee of $45,000. The additional interest of $67,500 and the remaining principal balance will be due in October 2017, unless the loan is extended an additional three months as allowed for under the loan agreement. Total interest expense incurred for the three months ended March 31, 2017 was $595,000. Total loan amortization cost for the three months ended March 31, 2017 was $60,000. The Company did not have any notes payable during the three months ended March 31, 2016. As of March 31, 2017, future principal payments on the notes payable are as follows: 2017 $ 3,587,000 2018 2,932,000 2019 773,000 2020 811,000 2021 860,000 Thereafter 32,956,000 Total $ 41,919,000 Principal payments table amount does not reflect the unamortized loan issuance cost of $195,000 as of March 31, 2017. As of March 31, 2017, the principal balances on notes payable are as follows: Property Location Current Loan Balance Interest Rate Loan Maturity D&O Financing N/A $ 70,000 3.81% 8/3/2017 West 9 th Cleveland, OH 5,252,000 4.50% 10/25/2026 MVP Detroit Center Garage, LLC Detroit MI 31,397,000 5.52% 1/10/2027 MVP San Jose 88 Garage, LLC San Jose, CA 2,200,000 7.75% 1/01/2019 MVP Cincinnati Race Street Garage, LLC Cincinnati, OH 3,000,000 9.00% 7/10/2017** Less unamortized loan issuance costs (195,000) Total $ 41,724,000 ** Extended to October 10, 2017 in April 2017 |
Fair Value
Fair Value | 3 Months Ended |
Mar. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value | Note L — Fair Value As of March 31, 2017 and December 31, 2016, the Company had no financial assets and liabilities utilizing Level 1 or Level 2. The Company had assets and liabilities utilizing Level 3 inputs including investments in equity and cost method investees. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, our degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an asset or liability will be classified in its entirety based on the lowest level of input that is significant to the measurement of fair value. Fair value is a market-based measure considered from the perspective of a market participant who holds the asset or owes the liability rather than an entity-specific measure. Therefore, even when market assumptions are not readily available, our own assumptions are set to reflect those that market participants would use in pricing the asset or liability at the measurement date. The Company uses prices and inputs that are current as of the measurement date, including during periods of market dislocation, such as the recent illiquidity in the auction rate securities market. In periods of market dislocation, the observability of prices and inputs may be reduced for many instruments. This condition may cause our financial instruments to be reclassified from Level 1 to Level 2 or Level 3 and/or vice versa. Our valuation techniques will be consistent with at least one of the three possible approaches: the market approach, income approach and/or cost approach. Our Level 1 inputs are based on the market approach and consist primarily of quoted prices for identical items on active securities exchanges. Our Level 2 inputs are primarily based on the market approach of quoted prices in active markets or current transactions in inactive markets for the same or similar collateral that do not require significant adjustment based on unobservable inputs. Our Level 3 inputs are primarily based on the income and cost approaches, specifically, discounted cash flow analyses, which utilize significant inputs based on our estimates and assumptions. The following table presents the valuation of our financial assets and liabilities as of March 31, 2017 measured at fair value on a recurring basis by input levels: Quoted Prices in Active Markets For Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Balance at 03/31/17 Carrying Value on Balance Sheet at 03/31/17 Assets Investment in equity method investee $ -- $ -- $ 1,150,000 $ 1,150,000 $ 1,150,000 Investment in cost method investee – held for sale $ -- $ -- $ 836,000 $ 836,000 $ 836,000 Investment in cost method investee $ -- $ -- $ 923,000 $ 923,000 $ 923,000 The following table presents the valuation of our financial assets and liabilities as of December 31, 2016 measured at fair value on a recurring basis by input levels: Quoted Prices in Active Markets For Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Balance at 12/31/16 Carrying Value on Balance Sheet at 12/31/16 Assets Investment in equity method investee $ -- $ -- $ 1,150,000 $ 1,150,000 $ 1,150,000 Investment in cost method investee – held for sale $ -- $ -- $ 836,000 $ 836,000 $ 836,000 Investment in cost method investee $ -- $ -- $ 936,000 $ 936,000 $ 936,000 |
Assets held for sale
Assets held for sale | 3 Months Ended |
Mar. 31, 2017 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Assets held for sale | Note M — Assets held for sale As of March 31, 2017, we had a 100% ownership interest in one property listed as held for sale, with a carrying value of approximately $700,000. The Company acquired the property on November 22, 2016 and recorded at the fair value based on an appraisal. During March 2017, Houston Jefferson entered into a purchase and sale agreement to sell the property “as is” to a third party for approximately $2.0 million. There can be no assurance that we will be successful in compmeting this transaction. The following is a summary of the results of operations related to the assets held for sale for three months ended March 31, 2017: For the three months ended March 31, 2017 Revenue $ 22,000 Expenses (16,000) Net income $ 6,000 |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note N — Subsequent Events The following subsequent events have been evaluated through the date of this filing with the SEC. During April 2017, the company increased their ownership interest in the MVP Houston Preston Lot from 20% to 60%, by purchasing $1.12 million of MVP REIT ownership and will now be considered the controlling party. The Company offered up to $50 million in shares (the “Shares”) of the Company’s Series A Convertible Redeemable Preferred Stock (“Series A”), par value $0.0001 per share, together with warrants to acquire the Company’s common stock, in a Regulation D 506(c) private placement to accredited investors. In connection with the private placement, on October 27, 2016, the Company filed with the State Department of Assessments and Taxation of Maryland Articles Supplementary to the charter of the Company classifying and designating 50,000 shares of Series A Convertible Redeemable Preferred Stock. The Company commenced the private placement of the Shares to accredited investors on November 1, 2016 and closed the offering on March 24, 2017. In connection with the Series A Convertible Redeemable Preferred Stock, the Company raised $2.6 million, net of offering costs. As disclosed on an 8-K filed with the SEC on March 30, 2017, the Company filed with the State Department of Assessments and Taxation of Maryland Articles Supplementary to the charter of the Company classifying and designating 97,000 shares of its authorized capital stock as shares of Series 1 Convertible Redeemable Preferred Stock ("Series 1"), par value $0.0001 per share. The Regulation D 506(b) private placement to accredited investors was available for sale starting April 7, 2017. On April 7, 2017, MVP REIT II, Inc. (the “Company”) issued a convertible note to an unaffiliated accredited investor in the principal amount of $2,000,000 (the “Note”). The Note bears interest at the rate of 5.75% per annum and has a maturity date of April 7, 2018. Interest is payable quarterly on the last business day of each March, June, September and December, commencing June 2017, and on the maturity date. At the holder’s option, the Note may be converted, in whole or in part, into shares of the Company’s Series 1 Convertible Redeemable Preferred Stock, par value $0.0001 per share (the “Series 1 Preferred Stock”) at a conversion price of $1,000 per share. The Company also will issue to the holder warrants (the “Warrants”) to acquire 35 shares of the Company’s common stock, par value $0.0001 per share, for each share of Series 1 Preferred Stock issued to the holder as a result of such conversion. On April 13, 2017, the Company and MVP REIT issued a promissory note to KeyBank for $12.7 million secured by a pool of properties, including MVP Denver Sherman, LLC, MVP Denver Sherman 1935, LLC, MVP Milwaukee Arena, LLC, MVP St. Louis Washington, LLC, MVP Louisville Station Broadway, LLC, and Cleveland Lincoln Garage Owners, LLC. This note had a 10 year term, an interest rate of 4.9% per annum and required monthly interest only payment for the first two years. After that the loan calls for monthly principal and interest payments of approximately $74,000, with a balloon payment at maturity. This loan mature in April 2027. These properties had been previously financed on the joint KeyBank line of credit and all loan proceeds were used to paydown the line. On May 1, 2017, the Company and MVP REIT issued a promissory note to Cantor Commercial Real Estate Lending, L.P. (“CCRE”) for $16.25 million secured by a pool of properties, including MVP Indianapolis Meridian Lot, LLC, MVP Louisville Station Broadway, LLC, White Front Garage Partners, LLC, MVP Houston Preston Lot, LLC, MVP Houston San Jacinto Lot, LLC, St. Louis Broadway Group, LLC, and St. Louis Seventh & Cerre, LLC. This note had a 10 year term, an interest rate of 5.03% per annum and required monthly interest only payment over the 10 year with a balloon payment at maturity. This loan matures in April 2027. These properties had been previously financed on the joint KeyBank line of credit and all loan proceeds were used to paydown the line. On May 1, 2017, MVP REIT, Inc. (“MVP I”) and MVP REIT II, Inc. (“MVP II”) jointly announced that, after reviewing strategic alternatives, a special committee of the board of directors of MVP I (the “MVP I Special Committee”) has accepted a non-binding Letter of Intent (“LOI”) from MVP II regarding a proposed merger of MVP I with MVP II. If necessary approvals are received and other conditions are satisfied, the merger consideration payable by MVP II to each holder of common stock, $0.001 par value per share, of MVP I would be 0.365 shares of common stock, $0.0001 par value per share, of MVP II. The LOI also provides, among other non-binding terms and conditions, that any definitive merger agreement agreed to by the parties will include go-shop and termination fee provisions. The proposed merger is subject to substantial conditions to consummation, including the entry by MVP I and MVP II into a definitive merger agreement, certain third party approvals and, if a definitive merger agreement is reached, any required stockholder approvals. There can be no assurance that the proposed merger will be consummated. |
Summary of Significant Accoun21
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Basis of Accounting | Basis of Accounting The accompanying unaudited condensed consolidated financial statements of the Company are prepared by management on the accrual basis of accounting and in accordance with principles generally accepted in the United States of America (“GAAP”) for interim financial information as contained in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”), and in conjunction with rules and regulations of the SEC. Certain information and footnote disclosures required for annual financial statements have been condensed or excluded pursuant to SEC rules and regulations. Accordingly, the unaudited condensed consolidated financial statements do not include all of the information and footnotes required by GAAP for complete financial statements. The unaudited condensed consolidated financial statements include accounts and related adjustments, which are, in the opinion of management, of a normal recurring nature and necessary for a fair presentation of the Company’s financial position, results of operations and cash flows for the interim period. Operating results for the three months ended March 31, 2017 are not necessarily indicative of the results that may be expected for the year ending December 31, 2017. These unaudited condensed consolidated financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016. The condensed consolidated balance sheet as of December 31, 2016 contained herein has been derived from the audited financial statements as of December 31, 2016, but does not include all disclosures required by GAAP. |
Consolidation | Consolidation The Company’s consolidated financial statements include its accounts and the accounts of its subsidiaries, Operating Partnership and all of the following subsidiaries. All intercompany profits and losses, balances and transactions are eliminated in consolidation. West 9 th MVP San Jose 88 Garage, LLC MCI 1372 Street, LLC Cincinnati Race Street, LLC St. Louis Washington, LLC St. Paul Holiday Garage, LLC Louisville Station Broadway, LLC White Front Garage Partners, LLC Cleveland Lincoln Garage, LLC MVP Houston Jefferson Lot, LLC MVP Houston San Jacinto Lot, LLC MVP Detroit Center Garage, LLC St Louis Broadway, LLC St Louis Seventh & Cerre, LLC Under GAAP, the Company’s consolidated financial statements will also include the accounts of its consolidated subsidiaries and joint ventures in which the Company is the primary beneficiary, or in which the Company has a controlling interest. In determining whether the Company has a controlling interest in a joint venture and the requirement to consolidate the accounts of that entity, the Company’s management considers factors such as an entity’s purpose and design and the Company’s ability to direct the activities of the entity that most significantly impacts the entity’s economic performance, ownership interest, board representation, management representation, authority to make decisions, and contractual and substantive participating rights of the partners/members as well as whether the entity is a variable interest entity in which it will absorb the majority of the entity’s expected losses, if they occur, or receive the majority of the expected residual returns, if they occur, or both. Equity investments in which the Company exercises significant influence but does not control and is not the primary beneficiary are accounted for using the equity method. The Company's share of its equity method investees' earnings or losses is included in other income in the accompanying unadutied condensed consolidated statements of operations. Investments in which the Company is not able to exercise significant influence over the investee are accounted for under the cost method. |
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 financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Management makes significant estimates regarding revenue recognition, purchase price allocations to record investments in real estate, and derivative financial instruments and hedging activities, as applicable. |
Concentration | Concentration The Company had eight parking tenants as of March 31, 2017. One tenant, Standard Parking + (“SP+”), represented a concentration for the three months ended March 31, 2017, in regards to parking base rental revenue. During the three months ended March 31, 2017, SP+ accounted for 65%, of the parking base rental revenue. Below is a table that summarizes base parking rent by tenant: Parking Tenant Percentage of Total Base Rental Revenue (as of March 31, 2017) SP + 65.3% Premier Parking 9.3% Interstate Parking 7.1% ABM 5.1% iPark Services 4.7% St. Louis Parking 3.6% Riverside Parking 2.7% Lanier 2.2% Grand Total 100.00% |
Acquisitions | Acquisitions The Company records the acquired tangible and intangible assets and assumed liabilities of acquisitions of all operating properties and those development and redevelopment opportunities that meet the accounting criteria to be accounted for as business combinations at fair value at the acquisition date. The Company assesses and considers fair value based on estimated cash flow projections that utilize available market information and discount and/or capitalization rates that the Company deems appropriate. Estimates of future cash flows are based on a number of factors including historical operating results, known and anticipated trends, and market and economic conditions. The acquired assets and assumed liabilities for an operating property acquisition generally include but are not limited to: land, buildings and improvements, construction in progress and identified tangible and intangible assets and liabilities associated with in-place leases, including tenant improvements, leasing costs, value of above-market and below-market operating leases and ground leases, acquired in-place lease values and tenant relationships, if any. The fair value of land is derived from comparable sales of land within the same submarket and/or region. The fair value of buildings and improvements, tenant improvements, and leasing costs are based upon current market replacement costs and other relevant market rate information. The fair value of the above-market or below-market component of an acquired in-place operating lease is based upon the present value (calculated using a market discount rate) of the difference between (i) the contractual rents to be paid pursuant to the lease over its remaining non-cancellable lease term and (ii) management's estimate of the rents that would be paid using fair market rental rates and rent escalations at the date of acquisition measured over the remaining non-cancellable term of the lease for above-market operating leases and the initial non-cancellable term plus the term of any below-market fixed rate renewal options, if applicable, for below-market operating leases. The amounts recorded for above-market operating leases are included in deferred leasing costs and acquisition-related intangibles, net on the balance sheet and are amortized on a straight-line basis as a reduction of rental income over the remaining term of the applicable leases. The amounts recorded for below-market operating leases are included in deferred revenue and acquisition-related liabilities, net on the balance sheet and are amortized on a straight-line basis as an increase to rental income over the remaining term of the applicable leases plus the term of any below-market fixed rate renewal options, if applicable. The Company’s below-market operating leases generally do not include fixed rate or below-market renewal options. The fair value of acquired in-place leases is derived based on management's assessment of lost revenue and costs incurred for the period required to lease the “assumed vacant” property to the occupancy level when purchased. This fair value is based on a variety of considerations including, but not necessarily limited to: (1) the value associated with avoiding the cost of originating the acquired in-place leases; (2) the value associated with lost revenue related to tenant reimbursable operating costs estimated to be incurred during the assumed lease-up period; and (3) the value associated with lost rental revenue from existing leases during the assumed lease-up period. Factors considered by the Company in performing these analyses include an estimate of the carrying costs during the expected lease-up periods, current market conditions, and costs to execute similar leases. In estimating carrying costs, the Company includes real estate taxes, insurance and other operating expenses, and estimates of lost rental revenue during the expected lease-up periods based on current market demand at market rates. In estimating costs to execute similar leases, the Company considers leasing commissions, legal and other related expenses. The amount recorded for acquired in-place leases is included in deferred leasing costs and acquisition-related intangibles, net on the balance sheet and amortized as an increase to depreciation and amortization expense over the remaining term of the applicable leases. If a lease were to be terminated or if termination were determined to be likely prior to its contractual expiration (for example resulting from bankruptcy), amortization of the related unamortized in-place lease intangible would be accelerated. The determination of the fair value of any debt assumed in connection with a property acquisition is estimated by discounting the future cash flows using interest rates available for the issuance of debt with similar terms and remaining maturities. The determination of the fair value of the acquired tangible and intangible assets and assumed liabilities of operating property acquisitions requires us to make significant judgments and assumptions about the numerous inputs discussed above. The use of different assumptions in these fair value calculations could significantly affect the reported amounts of the allocation of the Company’s acquisition related assets and liabilities and the related amortization and depreciation expense recorded for such assets and liabilities. In addition, because the value of above and below market leases are amortized as either a reduction or increase to rental income, respectively, the Company’s judgments for these intangibles could have a significant impact on the Company’s reported rental revenues and results of operations. Costs directly associated with all operating property acquisitions and those development and redevelopment acquisitions that meet the accounting criteria to be accounted for as business combinations are expensed as incurred. During the three months ended March 31, 2017, the Company expensed approximately $1.1 million in related party acquisition costs and $1.8 million of non-related party acquisition costs, for the purchase of an interest in three properties. During the three months ended March 31, 2016, the Company did not acquire any properties. The Company’s acquisition expenses are directly related to the Company’s acquisition activity and if the Company’s acquisition activity was to increase or decrease, so would the Company’s acquisition costs. |
Impairment of Long Lived Assets | Impairment of Long Lived Assets When circumstances indicate the carrying value of a property may not be recoverable, the Company reviews the asset for impairment. This review is based on an estimate of the future undiscounted cash flows, excluding interest charges, expected to result from the property’s use and eventual disposition. These estimates consider factors such as expected future operating income, market and other applicable trends and residual value, as well as the effects of leasing demand, competition and other factors. If impairment exists, due to the inability to recover the carrying value of a property, an impairment loss is recorded to the extent that the carrying value exceeds the estimated fair value of the property for properties to be held and used. For properties held for sale, the impairment loss is the adjustment to fair value less estimated cost to dispose of the asset. These assessments have a direct impact on net income because recording an impairment loss results in an immediate negative adjustment to net income. |
Cash | Cash Cash includes cash in bank accounts. The Company deposits cash with high quality financial institutions. These deposits are guaranteed by the Federal Deposit Insurance Company up to an insurance limit up of $250,000. As of March 31, 2017 and December 31, 2016, the Company had approximately $2.7 million and $3.4 million, respectively, in excess of the federally insured limits. |
Restricted Cash | Restricted Cash Restricted cash primarily consists of escrowed tenant improvement funds, real estate taxes, capital improvement funds, insurance premiums, and other amounts required to be escrowed pursuant to loan agreements. |
Revenue Recognition | Revenue Recognition The Company's revenues, which are derived primarily from rental income, include rents that each tenant pays in accordance with the terms of each lease reported on a straight-line basis over the initial term of the lease. Since many of the Company's leases will provide for rental increases at specified intervals, straight-line basis accounting requires the Company to record a receivable, and include in revenues, unbilled rent receivables that the Company will only receive if the tenant makes all rent payments required through the expiration of the initial term of the lease. The Company will continually review receivables related to rent and unbilled rent receivables and determine 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 in doubt, the Company will record an increase in the Company's allowance for uncollectible accounts or record a direct write-off of the receivable after exhaustive efforts at collection. |
Advertising Costs | Advertising Costs Advertising costs incurred in the normal course of operations and are expensed as incurred. During the three months ended March 31, 2017 and 2016, the Company had no advertising costs. |
Investments in Real Estate and Fixed Assets | Investments in Real Estate and Fixed Assets Investments in real estate and fixed assets are stated at cost less accumulated depreciation. Depreciation is provided principally on the straight-line method over the estimated useful lives of the assets, which are primarily 3 to 40 years. The cost of repairs and maintenance is charged to expense as incurred. Expenditures for property betterments and renewals are capitalized. Upon sale or other disposition of a depreciable asset, cost and accumulated depreciation are removed from the accounts and any gain or loss is reflected in other income (expense). The Company periodically evaluates whether events and circumstances have occurred that may warrant revision of the estimated useful lives of fixed assets or whether the remaining balance of fixed assets should be evaluated for possible impairment. The Company uses an estimate of the related undiscounted cash flows over the remaining life of the fixed assets in measuring their recoverability. |
Purchase Price Allocation | Purchase Price Allocation The Company allocates the purchase price of acquired properties to tangible and identifiable intangible assets acquired based on their respective fair values. Tangible assets include land, land improvements, buildings, fixtures and tenant improvements on an as-if vacant basis. The Company utilizes various estimates, processes and information to determine the as-if vacant property value. Estimates of value are made using customary methods, including data from appraisals, comparable sales, discounted cash flow analysis and other methods. Amounts allocated to land, land improvements, buildings and fixtures are based on cost segregation studies performed by independent third parties or on the Company's analysis of comparable properties in the Company's portfolio. Identifiable intangible assets include amounts allocated to acquire leases for above- and below-market lease rates, the value of in-place leases, and the value of customer relationships, as applicable. The aggregate value of intangible assets related to in-place leases is primarily the difference between the property valued with existing in-place leases adjusted to market rental rates and the property valued as if vacant. Factors considered by the Company in its analysis of the in-place lease intangibles include an estimate of carrying costs during the expected lease-up period for each property, taking into account current market conditions and costs to execute similar leases. In estimating carrying costs, the Company will include real estate taxes, insurance and other operating expenses and estimates of lost rentals at market rates during the expected lease-up period. Estimates of costs to execute similar leases including leasing commissions, legal and other related expenses are also utilized. Above-market and below-market in-place lease values for owned properties are recorded based on the present value (using an interest rate which reflects the risks associated with the leases acquired) of the difference between the contractual amounts to be paid pursuant to the in-place leases and management’s estimate of fair market lease rates for the corresponding in-place leases, measured over a period equal to the remaining non-cancelable term of the lease. The capitalized above-market lease intangibles are amortized as a decrease to rental income over the remaining term of the lease. The capitalized below-market lease values will be amortized as an increase to rental income over the remaining term and any fixed rate renewal periods provided within the respective leases. In determining the amortization period for below-market lease intangibles, the Company initially will consider, and periodically evaluate on a quarterly basis, the likelihood that a lessee will execute the renewal option. The likelihood that a lessee will execute the renewal option is determined 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. The aggregate value of intangible assets related to customer relationship, as applicable, is measured based on the Company's evaluation of the specific characteristics of each tenant’s lease and the Company's overall relationship with the tenant. Characteristics considered by the Company in determining these values include the nature and extent of its existing business relationships with the tenant, growth prospects for developing new business with the tenant, the tenant’s credit quality and expectations of lease renewals, among other factors. The value of in-place leases is amortized to expense over the initial term of the respective leases. The value of customer relationship intangibles is amortized to expense over the initial term and any renewal periods in the respective leases, but in no event does the amortization period for intangible assets exceed the remaining depreciable life of the building. If a tenant terminates its lease, the unamortized portion of the in-place lease value and customer relationship intangibles is charged to expense. In making estimates of fair values for purposes of allocating purchase price, the Company will utilize a number of sources, including independent appraisals that may be obtained in connection with the acquisition or financing of the respective property and other market data. The Company will also consider information obtained about each property as a result of the Company's pre-acquisition due diligence, as well as subsequent marketing and leasing activities, in estimating the fair value of the tangible and intangible assets acquired and intangible liabilities assumed. |
Organization, Offering and Related Costs | Organization, Offering and Related Costs Certain organization and offering costs will be incurred by the Advisor. Pursuant to the terms of the Advisory Agreement, the Company will not reimburse the Advisor for these out of pocket costs and future organization and offering costs it may incur. Such costs shall include legal, accounting, printing and other offering expenses, including marketing, and direct expenses of the Advisor’s employees and employees of the Advisor’s affiliates and others. All direct offering costs incurred and or paid by us that are directly attributable to a proposed or actual offering, including sales commissions, if any, were charged against the gross proceeds of the Offering and recorded as an offset to additional paid-in-capital. All indirect costs will be expensed as incurred. Offering costs were reclassified from deferred costs to stockholders’ equity when the Company commenced its Offering, and included all expenses incurred by the Company in connection with its Offering as of such date. |
Stock-Based Compensation | Stock-Based Compensation The Company has a stock-based incentive award plan, which is accounted for under the guidance for share based payments. The expense for such awards will be included in general and administrative expenses and is recognized over the vesting period or when the requirements for exercise of the award have been met (See Note G — Stock-Based Compensation). |
Income Taxes | Income Taxes The Company will elect and operate in a manner that will allow the Company, to qualify to be taxed as a REIT under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended, commencing with the taxable year ended December 31, 2016. If the Company qualifies for taxation as a REIT, it generally will not be subject to federal corporate income tax to the extent it distributes all of its REIT taxable income to its stockholders, and so long as it distributes at least 90% of its REIT taxable income. REITs are subject to a number of other organizational and operational requirements. Even if the Company qualifies to be taxed as a REIT, it may be subject to certain state and local taxes on its income and property, and federal income and excise taxes on its undistributed income. |
Per Share Data | Per Share Data The Company calculates basic income (loss) per share by dividing net income (loss) for the period by weighted-average shares of its common stock outstanding for the respective period. Diluted income per share takes into account the effect of dilutive instruments, such as stock options and convertible stock, but uses the average share price for the period in determining the number of incremental shares that are to be added to the weighted-average number of shares outstanding. The Company had no outstanding common share equivalents during the three months ended March 31, 2017 and December 31, 2016. |
Reportable Segments | Reportable Segments We currently operate one reportable segment. |
Accounting and Auditing Standards Applicable to "Emerging Growth Companies" | Accounting and Auditing Standards Applicable to “Emerging Growth Companies” The Company is an “emerging growth company” under the Jumpstart Our Business Startups Act (the “JOBS Act”). For as long as the Company remains an “emerging growth company,” which may be up to five fiscal years, the Company is not required to (1) comply with any new or revised financial accounting standards that have different effective dates for public and private companies until those standards would otherwise apply to private companies, (2) provide an auditor’s attestation report on management’s assessment of the effectiveness of internal control over financial reporting pursuant to Section 404 of the Sarbanes-Oxley Act, (3) comply with any new requirements adopted by the Public Company Accounting Oversight Board, or the PCAOB, requiring mandatory audit firm rotation or a supplement to the auditor’s report in which the auditor would be required to provide additional information about the audit and the financial statements of the issuer or (4) comply with any new audit rules adopted by the PCAOB after April 5, 2012, unless the SEC determines otherwise. The Company intends to take advantage of such extended transition period. Since the Company will not be required to comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for other public companies, the Company’s financial statements may not be comparable to the financial statements of companies that comply with public company effective dates. If the Company were to subsequently elect to instead comply with these public company effective dates, such election would be irrevocable pursuant to Section 107 of the JOBS Act. |
Share Repurchase Program | Share Repurchase Program The Company has a Share Repurchase Program (“SRP”) that enables stockholders to sell their shares to the Company. Under the SRP, stockholders may request that the Company redeem all or any portion, subject to certain minimum conditions described below, if such repurchase does not impair the Company's capital or operations. Prior to the time that the Company’s shares are listed on a national securities exchange, the repurchase price per share will depend on the length of time investors have held such shares as follows: no repurchases for the first two years unless shares are being repurchased in connection with a stockholder’s death or disability (as defined in the Code). Repurchase requests made in connection with the death or disability of a stockholder will be repurchased at a price per share equal to 100% of the amount the stockholder paid for each share, or once we have established an estimated NAV per share, 100% of such amount as determined by the Company’s board of directors, subject to any special distributions previously made to the Company’s stockholders. With respect to all other repurchases, prior to the date that we establish an estimated value per share of common stock, the purchase price will be 95.0% of the purchase price paid for the shares, if redeemed at any time between the second and third anniversaries of the purchase date, and 97.0% of the purchase price paid if redeemed after the third anniversary. After we establish an estimated NAV per share of common stock, the purchase price will be 95.0% of the NAV per share for the shares, if redeemed at any time between the second and third anniversaries of the purchase date, 97.0% of the NAV per share if redeemed at any time between the third and fifth anniversaries, and 100.0% of the NAV per share if redeemed after the fifth anniversary. In the event that the Company does not have sufficient funds available to repurchase all of the shares for which repurchase requests have been submitted in any quarter, we will repurchase the shares on a pro rata basis on the repurchase date. The SRP will be terminated if the Company’s shares become listed for trading on a national securities exchange or if the Company’s board of directors determines that it is in the Company’s best interest to terminate the SRP. The Company is not obligated to repurchase shares of common stock under the share repurchase program. The number of shares to be repurchased during the calendar quarter is limited to the lesser of: (i) 5% of the weighted average number of shares outstanding during the prior calendar year, and (ii) those repurchases that could be funded from the net proceeds of the sale of shares under the DRIP in the prior calendar year plus such additional funds as may be reserved for that purpose by the Company’s board of directors; provided, however, that the above volume limitations shall not apply to repurchases requested in connection with the death or qualifying disability of a stockholder. Because of these limitations, the Company cannot guarantee that the Company will be able to accommodate all repurchase requests. The Company will repurchase shares as of March 31 st th th st On October 27, 2016, the Company filed a Form 8-K announcing, among other things, an amendment to the SRP providing for participation in the SRP by any holder of the Company's Series A Convertible Redeemable Preferred Stock, or any future board-authorized series or class of preferred stock that is convertible into common stock of the Company. Under the amendment, which becomes effective on November 26, 2016, a preferred stock holder may participate in the SRP by converting its preferred stock into common stock of the Company, and submitting such common shares for repurchase. The time period, for purposes of determining how long such stockholder has held the common shares submitted for repurchase, begins as of the date such preferred stockholder acquired the underlying preferred shares that were converted into common shares and submitted for repurchase. The board of directors may, in its sole discretion, terminate, suspend or further amend the share repurchase program upon 30 days’ written notice without stockholder approval if it determines that the funds available to fund the share repurchase program are needed for other business or operational purposes or that amendment, suspension or termination of the share repurchase program is in the best interest of the stockholders. Among other things, we may amend the plan to repurchase shares at prices different from those described above for the purpose of ensuring the Company’s dividends are not “preferential” for incomes tax purposes. Any notice of a termination, suspension or amendment of the share repurchase program will be made via a report on Form 8-K filed with the SEC at least 30 days prior to the effective date of such termination, suspension or amendment. The board of directors may also limit the amounts available for repurchase at any time in its sole discretion. Notwithstanding the foregoing, the share repurchase program will terminate if the shares of common stock are listed on a national securities exchange. As of March 31, 2017, no shares are eligible for redemption (other than in connection with a death or disability of a stockholder). |
Distribution Reinvestment Plan | Distribution Reinvestment Plan Pursuant to the DRIP stockholders may elect to reinvest distributions by purchasing shares of common stock in lieu of receiving cash. No dealer manager fees or selling commissions are paid with respect to shares purchased pursuant to the DRIP. Participants purchasing shares pursuant to the DRIP have the same rights and are treated in the same manner as if such shares were issued pursuant to the Offering. The board of directors may designate that certain cash or other distributions be excluded from the DRIP. The Company has the right to amend any aspect of the DRIP or terminate the DRIP with ten days’ notice to participants. Shares issued under the DRIP are recorded to equity in the accompanying balance sheets in the period distributions are declared. We have issued a total of 29,731shares of common stock under the DRIP as of March 31, 2017. |
Non-controlling Interests | Non-controlling Interests The FASB issued authoritative guidance for non-controlling interests in December 2007, which establishes accounting and reporting standards for the non-controlling interest in a subsidiary and for the deconsolidation of a subsidiary. The guidance clarifies that a non-controlling interest in a subsidiary, which is sometimes referred to as an unconsolidated investment, is an ownership interest in the consolidated entity that should be reported as a component of equity in the consolidated financial statements. Among other requirements, the guidance requires consolidated net income to be reported at amounts attributable to both the parent and the non-controlling interest. It also requires disclosure, on the face of the consolidated income statement, of the amounts of consolidated net income attributable to the parent and to the non-controlling interest. |
Summary of Significant Accoun22
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Revenue Concentration | Parking Tenant Percentage of Total Base Rental Revenue (as of March 31, 2017) SP + 65.3% Premier Parking 9.3% Interstate Parking 7.1% ABM 5.1% iPark Services 4.7% St. Louis Parking 3.6% Riverside Parking 2.7% Lanier 2.2% Grand Total 100.00% |
Investments in Real Estate (Tab
Investments in Real Estate (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Real Estate [Abstract] | |
Schedule Of Real Estate Properties | Property Location Date Acquired Investment Amount Zoning Height Restriction Parking Tenant Lease Commencement Date MVP San Jose 88 Garage, LLC San Jose, CA 6/15/2016 $3,575,000 DC N/A Lanier Parking 3/01/2017 MCI 1372 Street, LLC Canton, OH 7/8/2016 $700,000 B-5 375 FT ABM 7/8/2016 MVP Cincinnati Race Street Garage, LLC Cincinnati, OH 7/8/2016 $4,500,000 DD-A 500 FT. SP + 9/1/2016 MVP St. Louis Washington, LLC St Louis, MO 7/18/2016 $3,000,000 CBD I 100 FT. SP + 7/21/2016 MVP St. Paul Holiday Garage, LLC St Paul, MN 8/12/2016 $8,200,000 B-5 Unlimited Interstate Parking 8/12/2016 MVP Louisville Station Broadway, LLC Louisville, KY 8/23/2016 $3,050,000 CBD I Unlimited Riverside Parking 8/23/2016 Cleveland Lincoln Garage Owners, LLC Cleveland, OH 10/19/2016 $7,331,000 SI-E5 / GR-E5 250 FT. SP + 10/25/2016 MVP Houston San Jacinto Lot, LLC Houston, TX 11/22/2016 $3,200,000 NONE Unlimited iPark Services 12/1/2016 White Front Garage Partners, LLC Nashville, TN 9/30/2016 $11,496,000 CBD I Unlimited Premier Parking 10/1/2016 West 9 th Cleveland, OH 5/11/2016 $5,675,000 CBD LLR-B4 175 FT. SP + 5/11/2016 33740 Crown Colony, LLC Cleveland, OH 5/17/2016 $3,030,000 LLR-D5 250 FT. SP + 5/17/2016 MVP Detroit Center Garage, LLC Detroit, MI 01/10/2017 $55,000,000 PD Unlimited SP + 2/1/2017 St Louis Broadway, LLC St Louis, MO 02/01/2017 $2,400,000 CBD I 200 FT. St Louis Parking Co 2/1/2017 St Louis Seventh & Cerre, LLC St Louis, MO 02/01/2017 $3,300,000 CBD I 200 FT. St Louis Parking Co 2/1/2017 $114,457,000 |
Acquisitions (Tables)
Acquisitions (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Business Combinations [Abstract] | |
Schedule Of Business Acquisitions | Property Location Date Acquired Property Type # Spaces Size / Acreage Retail /Office Square Ft. Investment Amount Ownership % MVP Detroit Center Garage Detroit, MI 01/10/2017 Garage 1,275 8.78 N/A $55,000,000 80.00% St Louis Broadway, LLC St Louis, MO 02/01/2017 Lot 161 0.96 N/A $2,400,000 100.00% St Louis Seventh & Cerre, LLC St Louis, MO 02/01/2017 Lot 174 1.20 N/A $3,300,000 100.00% |
Assets Acquired And Liabilities Assumed | Assets Liabilities Land and Improvements Building and improvements Total assets acquired Notes Payable Net assets and liabilities acquired MVP Detroit Center Garage 7,000,000 48,000,000 55,000,000 31,500,000 23,500,000 St Louis Broadway, LLC 2,400,000 -- 2,400,000 -- 2,400,000 St Louis Seventh & Cerre, LLC 3,300,000 -- 3,300,000 -- 3,300,000 $ 12,700,000 $ 48,000,000 $ 60,700,000 $ 31,500,000 $ 29,200,000 |
Pro Forma Consolidated Results Of Operations | March 31, 2017 March 31, 2016 Revenues from continuing operations $ 2,152,000 $ 958,000 Net income (loss) available to common stockholders $ (2,809,000) $ 696,000 Net income (loss) available to common stockholders per share – basic $ (2.09) $ 3.04 Net income (loss) available to common stockholders per share – diluted $ (2.09) $ 3.04 |
Notes Payable (Tables)
Notes Payable (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Debt Disclosure [Abstract] | |
Future Principal Payments On The Notes Payable | 2017 $ 3,587,000 2018 2,932,000 2019 773,000 2020 811,000 2021 860,000 Thereafter 32,956,000 Total $ 41,919,000 |
Schedule Of Debt | Property Location Current Loan Balance Interest Rate Loan Maturity D&O Financing N/A $ 70,000 3.81% 8/3/2017 West 9 th Cleveland, OH 5,252,000 4.50% 10/25/2026 MVP Detroit Center Garage, LLC Detroit MI 31,397,000 5.52% 1/10/2027 MVP San Jose 88 Garage, LLC San Jose, CA 2,200,000 7.75% 1/01/2019 MVP Cincinnati Race Street Garage, LLC Cincinnati, OH 3,000,000 9.00% 7/10/2017** Less unamortized loan issuance costs (195,000) Total $ 41,724,000 |
Fair Value (Tables)
Fair Value (Tables) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2017 | Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | ||
Schedule of Fair Value Assets and Liabilities Measured on a Recurring Basis | Quoted Prices in Active Markets For Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Balance at 03/31/17 Carrying Value on Balance Sheet at 03/31/17 Assets Investment in equity method investee $ -- $ -- $ 1,150,000 $ 1,150,000 $ 1,150,000 Investment in cost method investee – held for sale $ -- $ -- $ 836,000 $ 836,000 $ 836,000 Investment in cost method investee $ -- $ -- $ 923,000 $ 923,000 $ 923,000 | Quoted Prices in Active Markets For Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Balance at 12/31/16 Carrying Value on Balance Sheet at 12/31/16 Assets Investment in equity method investee $ -- $ -- $ 1,150,000 $ 1,150,000 $ 1,150,000 Investment in cost method investee – held for sale $ -- $ -- $ 836,000 $ 836,000 $ 836,000 Investment in cost method investee $ -- $ -- $ 936,000 $ 936,000 $ 936,000 |
Assets held for sale (Tables)
Assets held for sale (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Summary Of The Results Of Operations for Assets Held For Sale | For the three months ended March 31, 2017 Revenue $ 22,000 Expenses (16,000) Net income $ 6,000 |
Summary of Significant Accoun28
Summary of Significant Accounting Policies (Details) - Revenue Concentration | 3 Months Ended |
Mar. 31, 2017 | |
SP + [Member] | |
Concentration, Percentage of Total Base Rental Revenue | 65.30% |
Premier Parking [Member] | |
Concentration, Percentage of Total Base Rental Revenue | 9.30% |
Interstate Parking [Member] | |
Concentration, Percentage of Total Base Rental Revenue | 7.10% |
ABM [Member] | |
Concentration, Percentage of Total Base Rental Revenue | 5.10% |
iPark Services [Member] | |
Concentration, Percentage of Total Base Rental Revenue | 4.70% |
St. Louis Parking [Member] | |
Concentration, Percentage of Total Base Rental Revenue | 3.60% |
Riverside Parking [Member] | |
Concentration, Percentage of Total Base Rental Revenue | 2.70% |
Lanier [Member] | |
Concentration, Percentage of Total Base Rental Revenue | 2.20% |
Total [Member] | |
Concentration, Percentage of Total Base Rental Revenue | 100.00% |
Investments in Real Estate (Det
Investments in Real Estate (Detail) - Schedule of Real Estate Properties | 3 Months Ended |
Mar. 31, 2017USD ($) | |
San Jose 88 Garage [Member] | |
Location | San Jose, CA |
Date Acquired | 6/15/2016 |
Investment Amount | $ 3,575,000 |
Zoning | DC |
Height Restriction | N/A |
Parking Tenant | Lanier Parking |
Lease Commencement Date | 3/01/2017 |
MCI 1372 Street [Member] | |
Location | Canton, OH |
Date Acquired | 7/8/2016 |
Investment Amount | $ 700,000 |
Zoning | B5 |
Height Restriction | 375 FT |
Parking Tenant | ABM |
Lease Commencement Date | 7/8/2016 |
MVP Cincinnati Race Street Garage, LLC [Member] | |
Location | Cincinnati, OH |
Date Acquired | 7/8/2016 |
Investment Amount | $ 4,500,000 |
Zoning | DD-A |
Height Restriction | 500 FT. |
Parking Tenant | SP + |
Lease Commencement Date | 9/1/2016 |
MVP St. Louis Washington, LLC [Member] | |
Location | St Louis, MO |
Date Acquired | 7/18/2016 |
Investment Amount | $ 3,000,000 |
Zoning | CBD I |
Height Restriction | 100 FT. |
Parking Tenant | SP + |
Lease Commencement Date | 7/21/2016 |
MVP St. Paul Holiday Garage, LLC [Member] | |
Location | St Paul, MN |
Date Acquired | 8/12/2016 |
Investment Amount | $ 8,200,000 |
Zoning | B5 |
Height Restriction | Unlimited |
Parking Tenant | Interstate Parking |
Lease Commencement Date | 8/12/2016 |
MVP Louisville Station Broadway, LLC [Member] | |
Location | Louisville, KY |
Date Acquired | 8/23/2016 |
Investment Amount | $ 3,050,000 |
Zoning | CBD I |
Height Restriction | Unlimited |
Parking Tenant | Riverside Parking |
Lease Commencement Date | 8/23/2016 |
Cleveland Lincoln Garage Owners, LLC [Member] | |
Location | Cleveland, OH |
Date Acquired | 10/19/2016 |
Investment Amount | $ 7,331,000 |
Zoning | SI-E5 / GR-E5 |
Height Restriction | 250 FT. |
Parking Tenant | SP + |
Lease Commencement Date | 10/25/2016 |
MVP Houston San Jacinto Lot, LLC [Member] | |
Location | Houston, TX |
Date Acquired | 11/22/2016 |
Investment Amount | $ 3,200,000 |
Zoning | NONE |
Height Restriction | Unlimited |
Parking Tenant | iPark Services |
Lease Commencement Date | 12/1/2016 |
White Front Garage Partners, LLC [Member] | |
Location | Nashville, TN |
Date Acquired | 9/30/2016 |
Investment Amount | $ 11,496,000 |
Zoning | CBD I |
Height Restriction | Unlimited |
Parking Tenant | Premier Parking |
Lease Commencement Date | 10/1/2016 |
West 9th Properties II [Member] | |
Location | Cleveland, OH |
Date Acquired | 5/11/2016 |
Investment Amount | $ 5,675,000 |
Zoning | CBD LLR-B4 |
Height Restriction | 175 FT. |
Parking Tenant | SP + |
Lease Commencement Date | 5/11/2016 |
33740 Crown Colony, LLC [Member] | |
Location | Cleveland, OH |
Date Acquired | 5/17/2016 |
Investment Amount | $ 3,030,000 |
Zoning | LLR-D5 |
Height Restriction | 250 FT. |
Parking Tenant | SP + |
Lease Commencement Date | 5/17/2016 |
MVP Detroit Center Garage, LLC [Member] | |
Location | Detroit, MI |
Date Acquired | 01/10/2017 |
Investment Amount | $ 55,000,000 |
Zoning | PD |
Height Restriction | Unlimited |
Parking Tenant | SP + |
Lease Commencement Date | 2/1/2017 |
St Louis Broadway, LLC [Member] | |
Location | St Louis, MO |
Date Acquired | 02/01/2017 |
Investment Amount | $ 2,400,000 |
Zoning | CBD I |
Height Restriction | 200 FT. |
Parking Tenant | St Louis Parking Co |
Lease Commencement Date | 2/1/2017 |
St Louis Seventh & Cerre, LLC [Member] | |
Location | St Louis, MO |
Date Acquired | 02/01/2017 |
Investment Amount | $ 3,300,000 |
Zoning | CBD I |
Height Restriction | 200 FT. |
Parking Tenant | St Louis Parking Co |
Lease Commencement Date | 2/1/2017 |
Total [Member] | |
Investment Amount | $ 114,457,000 |
Acquisitions (Detail) - Schedul
Acquisitions (Detail) - Schedule Of Business Acquisitions | 3 Months Ended |
Mar. 31, 2017USD ($)ft²a | |
MVP Detroit Center Garage [Member] | |
Location | Detroit, MI |
Date Acquired | Jan. 10, 2017 |
Property Type | Garage |
# Spaces | 1,275 |
Size / Acreage | a | 8.78 |
Retail /Office Square Ft. | ft² | |
Investment Amount | $ | $ 55,000,000 |
Ownership % | 80.00% |
St Louis Broadway, LLC [Member] | |
Location | St Louis, MO |
Date Acquired | Feb. 1, 2017 |
Property Type | Lot |
# Spaces | 161 |
Size / Acreage | a | 0.96 |
Retail /Office Square Ft. | ft² | |
Investment Amount | $ | $ 2,400,000 |
Ownership % | 100.00% |
St Louis Seventh & Cerre, LLC [Member] | |
Location | St Louis, MO |
Date Acquired | Feb. 1, 2017 |
Property Type | Lot |
# Spaces | 174 |
Size / Acreage | a | 1.2 |
Retail /Office Square Ft. | ft² | |
Investment Amount | $ | $ 3,300,000 |
Ownership % | 100.00% |
Acquisitions (Detail) - Assets
Acquisitions (Detail) - Assets Acquired And Liabilities Assumed | Mar. 31, 2017USD ($) |
MVP Detroit Center Garage [Member] | |
Assets | |
Land and improvements | $ 7,000,000 |
Building and improvements | 48,000,000 |
Total assets acquired | 55,000,000 |
Liabilities | |
Notes Payable | 31,500,000 |
Net assets and liabilities acquired | 23,500,000 |
St Louis Broadway, LLC [Member] | |
Assets | |
Land and improvements | 2,400,000 |
Building and improvements | |
Total assets acquired | 2,400,000 |
Liabilities | |
Notes Payable | |
Net assets and liabilities acquired | 2,400,000 |
St Louis Seventh & Cerre, LLC [Member] | |
Assets | |
Land and improvements | 3,300,000 |
Building and improvements | |
Total assets acquired | 3,300,000 |
Liabilities | |
Notes Payable | |
Net assets and liabilities acquired | 3,300,000 |
Total [Member] | |
Assets | |
Land and improvements | 12,700,000 |
Building and improvements | 48,000,000 |
Total assets acquired | 60,700,000 |
Liabilities | |
Notes Payable | 31,500,000 |
Net assets and liabilities acquired | $ 29,200,000 |
Acquisitions (Detail) - Pro For
Acquisitions (Detail) - Pro Forma Consolidated Results Of Operations - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Business Combinations [Abstract] | ||
Revenues from continuing operations | $ 2,152,000 | $ 958,000 |
Net Income (loss) available to common stockholders | $ (2,809,000) | $ 696,000 |
Net loss available to common stockholders per share - basic | $ (2.09) | $ 3.04 |
Net loss available to common stockholders per share - diluted | $ (2.09) | $ 3.04 |
Notes Payable (Detail) - Future
Notes Payable (Detail) - Future Principal Payments On The Notes Payable 2016 | Mar. 31, 2017USD ($) |
2017 [Member] | |
Principal Payments | $ 3,587,000 |
2018 [Member] | |
Principal Payments | 2,932,000 |
2019 [Member] | |
Principal Payments | 773,000 |
2020 [Member] | |
Principal Payments | 811,000 |
2021 [Member] | |
Principal Payments | 860,000 |
Thereafter [Member] | |
Principal Payments | 32,956,000 |
Total [Member] | |
Principal Payments | $ 41,919,000 |
Notes Payable (Detail) - Schedu
Notes Payable (Detail) - Schedule of Debt | 3 Months Ended |
Mar. 31, 2017USD ($) | |
D&O Financing [Member] | |
Current Loan Balance | $ 70,000 |
Interest Rate | 3.81% |
Loan Maturity | Aug. 3, 2017 |
West 9th Properties II [Member] | |
Current Loan Balance | $ 5,252,000 |
Interest Rate | 4.50% |
Loan Maturity | Oct. 25, 2026 |
MVP Detroit Center Garage, LLC [Member] | |
Current Loan Balance | $ 31,397,000 |
Interest Rate | 5.52% |
Loan Maturity | Jan. 10, 2027 |
MVP San Jose 88 Garage, LLC [Member] | |
Current Loan Balance | $ 2,200,000 |
Interest Rate | 7.75% |
Loan Maturity | Jan. 1, 2019 |
MVP Cincinnati Race Street Garage, LLC [Member] | |
Current Loan Balance | $ 3,000,000 |
Interest Rate | 9.00% |
Loan Maturity | Jul. 10, 2017 |
Less unamortized loan issuance costs [Member] | |
Current Loan Balance | $ (195,000) |
Total [Member] | |
Current Loan Balance | $ 41,724,000 |
Fair Value (Detail) - Schedule
Fair Value (Detail) - Schedule of Fair Value Assets and Liabilities Measured on a Recurring Basis - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
Quoted Prices in Active Markets For Identical Assets (Level 1) [Member] | ||
Investment In Equity Method Investee | ||
Investment in cost method investee - held for sale | ||
Investment in cost method investee | ||
Significant Other Observable Inputs (Level 2) [Member] | ||
Investment In Equity Method Investee | ||
Investment in cost method investee - held for sale | ||
Investment in cost method investee | ||
Significant Unobservable Inputs (Level 3) [Member] | ||
Investment In Equity Method Investee | 1,150,000 | 1,150,000 |
Investment in cost method investee - held for sale | 836,000 | 836,000 |
Investment in cost method investee | 923,000 | 936,000 |
Balance at 03/31/17 [Member] | ||
Investment In Equity Method Investee | 1,150,000 | 1,150,000 |
Investment in cost method investee - held for sale | 836,000 | 836,000 |
Investment in cost method investee | 923,000 | 936,000 |
Carrying Value on Balance Sheet at 03/31/17 [Member] | ||
Investment In Equity Method Investee | 1,150,000 | 1,150,000 |
Investment in cost method investee - held for sale | 836,000 | 836,000 |
Investment in cost method investee | $ 923,000 | $ 936,000 |
Assets Held For Sale (Detail) -
Assets Held For Sale (Detail) - Summary Of Results Of Operations Related To Assets Held For Sale | 3 Months Ended |
Mar. 31, 2017USD ($) | |
Property, Plant and Equipment [Abstract] | |
Revenue | $ 22,000 |
Expenses | (16,000) |
Net Income | $ 6,000 |
Organization and Proposed Bus37
Organization and Proposed Business Operations (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Dec. 31, 2016 | |
Date of Incorporation | May 4, 2015 | |
Incorporation State | Maryland | |
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 |
Share Price, Initial Public Offering | $ 25 | |
Shares Issued | 2,521,088 | 2,301,828 |
Stock Issued Value | $ 60,900,000 | |
Deferred Offering Costs | 1,100,000 | |
Distribution Reinvestment Plan, share value | $ 50,000,000 | |
Distribution Reinvestment Plan, per share value | $ 25 | |
Advisor | The Companys advisor is MVP Realty Advisors, LLC (the Advisor), a Nevada limited liability company, which is owned 60% by VRM II and 40% by VRM I. The Advisor is responsible for managing the Companys affairs on a day-to-day basis and for identifying and making investments on the Companys behalf pursuant to an advisory agreement between the Company and the Advisor (the Advisory Agreement). The Company has no paid employees. | |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 98,999,000 | 98,999,000 |
Preferred Stock Series A | ||
Preferred stock, shares authorized | 50,000 | 50,000 |
Private Placement | The Company commenced the private placement of the Shares to accredited investors on November 1, 2016 and closed the offering on March 24, 2017. In connection with the Series A Convertible Redeemable Preferred Stock, the Company raised $____ million, net of offering costs. | |
Preferred stock par value | $ 0.0001 | $ 0.0001 |
Series 1 Convertible Redeemable Preferred Stock | ||
Preferred stock, shares authorized | 97,000 | |
Preferred stock par value | $ 0.0001 | |
MVP CP II / Sponser [Member] | ||
Shares Issued | 8,000 | |
Stock Issued Value | $ 200,000 | |
Cash Distributions | $ 435,000 | |
VRM II [Member] | ||
Shares Issued | 5,000 |
Summary of Significant Accoun38
Summary of Significant Accounting Policies (Details Narrative) - USD ($) | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Acquisition expenses | $ 1,766,000 | ||
Federally Insured Amount Limit | 250,000 | $ 250,000 | |
Cash In Excess Of The Federally Insured Limits | 2,700,000 | $ 3,400,000 | |
Advertising Costs | |||
Common Share Equivalents Outstanding | |||
Segments | one reportable segment | ||
DRIP [Member] | |||
Share Issued | 29,731 | ||
3 Properties [Member] | Related Party [Member] | |||
Acquisition expenses | $ 1,100,000 | ||
3 Properties [Member] | Non-Related Party [Member] | |||
Acquisition expenses | $ 1,800,000 | ||
Standard Parking + [Member] | |||
Concentration | 65.00% |
Related Party Transactions an39
Related Party Transactions and Arrangements (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Distributions Received | $ (52,000) | |
Acquisition Fees | 60,000 | |
Acquisition Expenses | $ 1,766,000 | |
Sponsor [Member] | ||
Common Stock Outstanding | 8,000 | |
VRM II [Member] | ||
Common Stock Outstanding | 5,000 | |
MVP REIT [Member] | ||
Investment in Affiliate | $ 3,000,000 | |
Investment in Affiliate, shares | 338,409 | |
Investement in Affiliate, per share | $ 8.865 | |
Distributions Received | $ 52,000 | |
Advisor [Member] | ||
Acquisition Fees | 1,100,000 | 100,000 |
Acquisition Expenses | ||
Asset Management Fees | 237,000 | |
Operating Expenses | ||
Disposition Fees | ||
Subordinated Performance Fees |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details Narrative) | 3 Months Ended |
Mar. 31, 2017shares | |
Stock Options Granted Percentage Limit | 10.00% |
Aggregate Maximum Number of Shares Under Incentive Plan | 500,000 |
Long-Term Incentive Plan [Member] | |
Grants |
Line of Credit (Details Narrati
Line of Credit (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Interest expense | $ (655,000) | $ (1,000) |
Loan Fees | (183,000) | |
Line of Credit [Member] | ||
Maximum Amount Outstanding During Period | 19,700,000 | |
Interest expense | 139,000 | |
Loan Fees | 36,000 | |
Unused Line Fees | $ 1,500 | |
Subsidiary (the "Borrowers") [Member] | ||
Initiation Date | Oct. 5, 2016 | |
Line of Credit, Description | On October 5, 2016, the Company, through its Operating Partnership, and MVP REIT, (the REITs) through a wholly owned subsidiary (the "Borrowers") entered into a credit agreement (the "Unsecured Credit Agreement") with KeyBank, National Association ('KeyBank") as the administrative agent and KeyBank Capital Markets ("KeyBank Capital Markets") as the lead arranger. Pursuant to the Unsecured Credit Agreement, the Borrowers were provided with a $30 million unsecured credit facility (the "Unsecured Credit Facility"), which may be increased up to $100 million, in minimum increments of $10 million. The Unsecured Credit Facility has an initial term of two years, maturing on October 5, 2018, and may be extended for a one-year period if certain conditions are met and upon payment of an extension fee. | |
Interest Rate, Description | The Unsecured Credit Facility has an interest rate calculated based on LIBOR Rate plus 2.25% or Base Rate plus 1.25%, both as provided in the Unsecured Credit Agreement. The Base Rate is calculated as the greater of (i) the KeyBank Prime rate or (ii) the Federal Funds rate plus ½ of 1%. Payments under the Unsecured Credit Facility are interest only and are due on the first day of each quarter. | |
Maximum Borrowing Capacity | $ 28,000,000 | |
Maximum Amount Outstanding During Period | $ 27,900,000 |
Notes Payable (Details Narrativ
Notes Payable (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | |||
Apr. 30, 2017 | Jan. 31, 2017 | Nov. 30, 2016 | Oct. 31, 2016 | Mar. 31, 2017 | |
Notes Payable | |||||
Interest expense | $ 595,000 | ||||
Loan Amortization Cost | 60,000 | ||||
Unamortized Loan Issuance Cost | $ 195,000 | ||||
American National Insurance Company of New York Promissory Note [Member] | West 9th Properties II [Member] | |||||
Notes Payable | |||||
Amount | $ 5,300,000 | ||||
Term | 10 years | ||||
Interest | 4.50% | ||||
Periodic Payment | $ 30,000 | ||||
Frequency of Periodic Payment | monthly | ||||
Maturity Date | Oct. 31, 2026 | ||||
Insurance Policy [Member] | |||||
Notes Payable | |||||
Down payment | $ 25,000 | ||||
Interest | 3.80% | ||||
Periodic Payment | $ 14,000 | ||||
Frequency of Periodic Payment | monthly | ||||
Loan Payments Start Date | Nov. 3, 2016 | ||||
Secured Loan Agreement with Bank of America, N.A. [Member] | MVP Detroit Center Garage, LLC [Member] | |||||
Notes Payable | |||||
Term | 10 years | ||||
Interest | 5.52% | ||||
Periodic Payment | $ 253,000 | ||||
Frequency of Periodic Payment | monthly | ||||
Maturity Date | Feb. 28, 2027 | ||||
Owens Realty Mortgage Promissory Note [Member] | MVP San Jose 88 Garage [Member] | |||||
Notes Payable | |||||
Amount | $ 2,200,000 | ||||
Interest | 7.75% | ||||
Collateral | collateralized by real property located in San Jose, California | ||||
Periodic Payment | $ 14,000 | ||||
Frequency of Periodic Payment | monthly | ||||
Maturity Date | Jan. 31, 2019 | ||||
Moonshell, LLC Promissory Note [Member] | MVP Cincinnati Race Street Garage [Member] | |||||
Notes Payable | |||||
Amount | $ 3,000,000 | ||||
Interest | 9.00% | ||||
Collateral | collateralized by real property located in Cincinnati, Ohio | ||||
Maturity Date | Jul. 31, 2017 | ||||
Moonshell, LLC Promissory Note [Member] | MVP Cincinnati Race Street Garage [Member] | Extension [Member] | |||||
Notes Payable | |||||
Amount | $ 3,000,000 | ||||
Interest | 9.00% | ||||
Collateral | collateralized by real property located in Cincinnati, Ohio | ||||
Maturity Date | Oct. 31, 2017 | ||||
Extension Fee | $ 45,000 | ||||
Additional Interest | $ 67,500 |
Assets held for sale (Details N
Assets held for sale (Details Narrative) | 3 Months Ended |
Mar. 31, 2017USD ($) | |
Discontinued Operations and Disposal Groups [Abstract] | |
Assets held for sale | $ 700,000 |
Date Property Acquired | Nov. 22, 2016 |
Agreement to Sell Property | During March 2017, Houston Jefferson entered into a purchase and sale agreement to sell the property as is to a third party for approximately $2.0 million. |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) | 1 Months Ended | |
May 31, 2017 | Apr. 30, 2017 | |
Increased Ownership Interest [Member] | ||
Description | During April 2017, the company increased their ownership interest in the MVP Houston Preston Lot from 20% to 60%, by purchasing $1.12 million of MVP REIT ownership and will now be considered the controlling party. | |
Series A Convertible Redeemable Preferred Stock [Member] | ||
Description | The Company offered up to $50 million in shares (the Shares) of the Companys Series A Convertible Redeemable Preferred Stock (Series A), par value $0.0001 per share, together with warrants to acquire the Companys common stock, in a Regulation D 506(c) private placement to accredited investors. In connection with the private placement, on October 27, 2016, the Company filed with the State Department of Assessments and Taxation of Maryland Articles Supplementary to the charter of the Company classifying and designating 50,000 shares of Series A Convertible Redeemable Preferred Stock. The Company commenced the private placement of the Shares to accredited investors on November 1, 2016 and closed the offering on March 24, 2017. In connection with the Series A Convertible Redeemable Preferred Stock, the Company raised $2.6 million, net of offering costs. | |
Series 1 Convertible Redeemable Preferred Stock [Member] | ||
Date of Event | Apr. 7, 2017 | |
Description | As disclosed on an 8-K filed with the SEC on March 30, 2017, the Company filed with the State Department of Assessments and Taxation of Maryland Articles Supplementary to the charter of the Company classifying and designating 97,000 shares of its authorized capital stock as shares of Series 1 Convertible Redeemable Preferred Stock ("Series 1"), par value $0.0001 per share. The Regulation D 506(b) private placement to accredited investors was available for sale starting April 7, 2017. | |
Issued A Convertible Note To An Unaffiliated Accredited Investor [Member] | ||
Date of Event | Apr. 7, 2017 | |
Description | On April 7, 2017, MVP REIT II, Inc. (the Company) Issued A Convertible Note To An Unaffiliated Accredited Investor in the principal amount of $2,000,000 (the Note). The Note bears interest at the rate of 5.75% per annum and has a maturity date of April 7, 2018. Interest is payable quarterly on the last business day of each March, June, September and December, commencing June 2017, and on the maturity date. At the holders option, the Note may be converted, in whole or in part, into shares of the Companys Series 1 Convertible Redeemable Preferred Stock, par value $0.0001 per share (the Series 1 Preferred Stock) at a conversion price of $1,000 per share. The Company also will issue to the holder warrants (the Warrants) to acquire 35 shares of the Companys common stock, par value $0.0001 per share, for each share of Series 1 Preferred Stock issued to the holder as a result of such conversion. | |
Issued A Promissory Note To Keybank [Member] | ||
Date of Event | Apr. 13, 2017 | |
Description | On April 13, 2017, the Company and MVP REIT issued a promissory note to KeyBank for $12.7 million secured by a pool of properties, including MVP Denver Sherman, LLC, MVP Denver Sherman 1935, LLC, MVP Milwaukee Arena, LLC, MVP St. Louis Washington, LLC, MVP Louisville Station Broadway, LLC, and Cleveland Lincoln Garage Owners, LLC. This note had a 10 year term, an interest rate of 4.9% per annum and required monthly interest only payment for the first two years. After that the loan calls for monthly principal and interest payments of approximately $74,000, with a balloon payment at maturity. This loan mature in April 2027. These properties had been previously financed on the joint KeyBank line of credit and all loan proceeds were used to paydown the line. | |
Issued A Promissory Note To Cantor Commercial Real Estate Lending [Member] | ||
Date of Event | May 1, 2017 | |
Description | On May 1, 2017, the Company and MVP REIT issued a promissory note to Cantor Commercial Real Estate Lending, L.P. (CCRE) for $16.25 million secured by a pool of properties, including MVP Indianapolis Meridian Lot, LLC, MVP Louisville Station Broadway, LLC, White Front Garage Partners, LLC, MVP Houston Preston Lot, LLC, MVP Houston San Jacinto Lot, LLC, St. Louis Broadway Group, LLC, and St. Louis Seventh & Cerre, LLC. This note had a 10 year term, an interest rate of 5.03% per annum and required monthly interest only payment over the 10 year with a balloon payment at maturity. This loan matures in April 2027. These properties had been previously financed on the joint KeyBank line of credit and all loan proceeds were used to paydown the line. | |
Letter of Intent [Member] | ||
Date of Event | May 1, 2017 | |
Description | On May 1, 2017, MVP REIT, Inc. (MVP I) and MVP REIT II, Inc. (MVP II) jointly announced that, after reviewing strategic alternatives, a special committee of the board of directors of MVP I (the MVP I Special Committee) has accepted a non-binding Letter of Intent (LOI) from MVP II regarding a proposed merger of MVP I with MVP II. If necessary approvals are received and other conditions are satisfied, the merger consideration payable by MVP II to each holder of common stock, $0.001 par value per share, of MVP I would be 0.365 shares of common stock, $0.0001 par value per share, of MVP II. The LOI also provides, among other non-binding terms and conditions, that any definitive merger agreement agreed to by the parties will include go-shop and termination fee provisions. The proposed merger is subject to substantial conditions to consummation, including the entry by MVP I and MVP II into a definitive merger agreement, certain third party approvals and, if a definitive merger agreement is reached, any required stockholder approvals. There can be no assurance that the proposed merger will be consummated. |