Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2016 | Nov. 04, 2016 | |
Document And Entity Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | CHPII | |
Entity Registrant Name | CNL Healthcare Properties II, Inc. | |
Entity Central Index Key | 1,648,383 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Class A Common Stock | ||
Document And Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 294,765 | |
Class T Common Stock | ||
Document And Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 84,835 | |
Class I Common Stock | ||
Document And Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 8,407 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
ASSETS | ||
Cash | $ 3,139,957 | $ 200,000 |
Restricted cash | 383,000 | |
Prepaid expenses | 85,624 | |
Total assets | 3,608,581 | 200,000 |
Liabilities: | ||
Due to related parties | 384,867 | |
Notes payable | 312,500 | |
Accounts payable and accrued expenses | 66,396 | |
Total liabilities | 763,763 | |
Commitments and contingencies (Note 6) | ||
Stockholders' equity: | ||
Preferred stock, $0.01 par value per share, 10,000,000 shares authorized; none issued or outstanding | ||
Common stock value | 200 | |
Capital in excess of par value | 2,973,081 | 199,800 |
Accumulated loss | (110,588) | |
Accumulated distributions | (20,662) | |
Total stockholders' equity | 2,844,818 | 200,000 |
Total liabilities and stockholders' equity | 3,608,581 | $ 200,000 |
Class A Common Stock | ||
Stockholders' equity: | ||
Common stock value | 2,812 | |
Total stockholders' equity | 2,812 | |
Class T Common Stock | ||
Stockholders' equity: | ||
Common stock value | 91 | |
Total stockholders' equity | 91 | |
Class I Common Stock | ||
Stockholders' equity: | ||
Common stock value | 84 | |
Total stockholders' equity | $ 84 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Parenthetical) - $ / shares | Sep. 30, 2016 | Dec. 31, 2015 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.01 | |
Common stock, shares authorized | 1,000,000,000 | |
Common stock, shares issued | 20,000 | |
Common stock, shares outstanding | 20,000 | |
Class A Common Stock | ||
Common stock, par value | $ 0.01 | |
Common stock, shares authorized | 1,200,000,000 | |
Common stock, shares issued | 281,227 | |
Common stock, shares outstanding | 281,227 | |
Class T Common Stock | ||
Common stock, par value | $ 0.01 | |
Common stock, shares authorized | 700,000,000 | |
Common stock, shares issued | 9,121 | |
Common stock, shares outstanding | 9,121 | |
Class I Common Stock | ||
Common stock, par value | $ 0.01 | |
Common stock, shares authorized | 100,000,000 | |
Common stock, shares issued | 8,407 | |
Common stock, shares outstanding | 8,407 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) | 3 Months Ended | 9 Months Ended |
Sep. 30, 2016 | Sep. 30, 2016 | |
Operating expenses: | ||
General and administrative | $ 93,439 | $ 93,439 |
Total operating expenses | 93,439 | 93,439 |
Other expense: | ||
Interest expense | 17,149 | 17,149 |
Total other expense | 17,149 | 17,149 |
Net loss attributable to common stockholders | (110,588) | (110,588) |
Class A Common Stock | ||
Other expense: | ||
Net loss attributable to common stockholders | $ (105,801) | $ (106,416) |
Net loss per share of common stock outstanding (basic and diluted) | $ (0.42) | $ (1.09) |
Weighted average number of common shares outstanding (basic and diluted) | 249,760 | 97,841 |
Distributions declared per common share | $ 0.07 | $ 0.07 |
Class T Common Stock | ||
Other expense: | ||
Net loss attributable to common stockholders | $ (2,421) | $ (2,110) |
Net loss per share of common stock outstanding (basic and diluted) | $ (0.42) | $ (1.09) |
Weighted average number of common shares outstanding (basic and diluted) | 5,716 | 1,940 |
Distributions declared per common share | $ 0.07 | $ 0.07 |
Class I Common Stock | ||
Other expense: | ||
Net loss attributable to common stockholders | $ (2,366) | $ (2,062) |
Net loss per share of common stock outstanding (basic and diluted) | $ (0.42) | $ (1.09) |
Weighted average number of common shares outstanding (basic and diluted) | 5,584 | 1,896 |
Distributions declared per common share | $ 0.07 | $ 0.07 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY - USD ($) | Total | Common Stock | Capital in Excess of Par Value | Accumulated Loss | Accumulated Distributions | Class A Common Stock | Class T Common Stock | Class I Common Stock |
Beginning Balance at Jul. 09, 2015 | $ 0 | |||||||
Subscriptions received for common stock through public offering and reinvestment plan and Issuance of initial common stock shares | 200,000 | $ 200 | $ 199,800 | |||||
Subscriptions received for common stock through public offering and reinvestment plan and Issuance of initial common stock shares (in shares) | 20,000 | |||||||
Ending Balance at Sep. 30, 2015 | 200,000 | $ 200 | 199,800 | |||||
Ending Balance (in shares) at Sep. 30, 2015 | 20,000 | |||||||
Beginning Balance at Jul. 09, 2015 | 0 | |||||||
Ending Balance at Dec. 31, 2015 | $ 200,000 | $ 200 | 199,800 | |||||
Ending Balance (in shares) at Dec. 31, 2015 | 20,000 | 20,000 | ||||||
Conversion of initial common stock shares | $ (200) | $ 200 | ||||||
Conversion of initial common stock shares (in shares) | (20,000) | 20,000 | ||||||
Subscriptions received for common stock through public offering and reinvestment plan and Issuance of initial common stock shares | $ 2,778,749 | 2,775,972 | $ 2,602 | $ 91 | $ 84 | |||
Subscriptions received for common stock through public offering and reinvestment plan and Issuance of initial common stock shares (in shares) | 300,000 | 260,180 | 9,089 | 8,375 | ||||
Stock dividends issued | (10) | $ 10 | ||||||
Stock dividends issued (in shares) | 1,000 | 1,047 | 32 | 32 | ||||
Stock issuance and offering costs | $ (2,681) | (2,681) | ||||||
Net loss | (110,588) | $ (110,588) | ||||||
Cash distributions declared | (20,662) | $ (20,662) | ||||||
Ending Balance at Sep. 30, 2016 | $ 2,844,818 | $ 2,973,081 | $ (110,588) | $ (20,662) | $ 2,812 | $ 91 | $ 84 | |
Ending Balance (in shares) at Sep. 30, 2016 | 281,227 | 9,121 | 8,407 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) | 9 Months Ended |
Sep. 30, 2016USD ($) | |
Operating activities: | |
Net cash flows used in operating activities | $ (128,324) |
Financing activities: | |
Subscriptions received for common stock through public offering | 2,778,749 |
Payment of stock issuance and offering costs | (2,306) |
Distributions to stockholders | (20,662) |
Proceeds from notes payable | 312,500 |
Net cash flows provided by financing activities | 3,068,281 |
Net increase in cash | 2,939,957 |
Cash at beginning of period | 200,000 |
Cash at end of period | 3,139,957 |
Amounts incurred but not paid (including amounts due to related parties): | |
REIT Funding escrow | 383,000 |
Annual distribution and stockholder servicing fee | $ 375 |
Organization
Organization | 9 Months Ended |
Sep. 30, 2016 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Organization | 1. Organization CNL Healthcare Properties II, Inc. (“Company”) is a Maryland corporation organized on July 10, 2015 that intends to qualify as a real estate investment trust (“REIT”) for U.S. federal income tax purposes beginning with the year ending December 31, 2016 or the year in which the Company commences material operations. The Company is sponsored by CNL Financial Group, LLC (“CNL”) and was formed primarily to acquire and manage a diversified portfolio of healthcare real estate and real estate-related assets that it believes will generate a steady current return and provide long-term value to its stockholders. It intends to focus on investing, primarily in the United States, within the seniors housing, medical office, acute care and post-acute care sectors, as well as other types of real estate and real estate-related securities and loans. The Company is externally managed and advised by CHP II Advisors, LLC (“Advisor”), an affiliate of CNL. The Advisor provides advisory services to the Company relating to substantially all aspects of its investments and operations, including real estate acquisitions, asset management and other operational matters. During the period from July 10, 2015 to December 31, 2015, the Company sold 20,000 shares of common stock to the Advisor for an aggregate purchase price of $0.2 million, and these shares were converted into 20,000 Class A shares upon the filing of the Company’s Articles of Amendment and Restatement in March 2016. The Company did not pay any selling commissions or dealer manager fees in connection with the sale of these shares. On March 2, 2016, pursuant to a registration statement on Form S-11 under the Securities Act of 1933, the Company commenced its initial public offering of up to $1.75 billion, in any combination, of Class A, Class T and Class I shares of common stock (“Primary Offering”) on a “best efforts” basis, which means that CNL Securities Corp. (“Dealer Manager”), an affiliate of CNL, will use its best efforts but is not required to sell any specific amount of shares. The Company also intends to offer up to $250 million, in any combination, of Class A, Class T and Class I shares to be issued pursuant to a distribution reinvestment plan (“Reinvestment Plan” and, together with the Primary Offering, the “Offering”). The Company reserves the right to reallocate the shares offered between the Primary Offering and the Reinvestment Plan. From the time of the Company’s formation on July 10, 2015 (inception) through July 10, 2016, the Company had not commenced operations because they were in their development stage and had not received the minimum required offering amount of $2.0 million in shares of common stock. T through the sale of 250,000 Class A shares to and The Company intends to own substantially all of its assets either directly or indirectly through an operating partnership, CHP II Partners, LP (“Operating Partnership”), in which the Company is the sole limited partner and its wholly-owned subsidiary, CHP II GP, LLC, is the sole general partner. 1. Organization (continued) The Company generally expects to lease its seniors housing properties to wholly-owned taxable REIT subsidiary entities (each, a “TRS”) and engage independent third-party managers under management agreements to operate the properties as permitted under REIT Investment Diversification and Empowerment Act of 2007 (“RIDEA”) structures; however, the Company may also lease its properties to third-party tenants under triple-net or similar lease structures, where the tenant bears all or substantially all of the costs (including cost increases for real estate taxes, utilities, insurance and ordinary repairs). Medical office, acute care and post-acute care properties will generally be leased on a triple-net, net or modified gross basis to third-party tenants. In addition, the Company expects most investments will be wholly-owned, although, it may invest through partnerships with other entities where the Company believes it is appropriate and beneficial. The Company expects to invest in a combination of stabilized assets, new property developments and properties which have not reached full stabilization. Finally, the Company may invest in and originate mortgage, bridge or mezzanine loans or in entities that make investments similar to the foregoing investment types. The Company would generally make loans to the owners of properties to enable them to acquire land, buildings, or to develop property. In exchange, the owner generally grants the Company a first lien or collateralized interest in a participating mortgage collateralized by the property or by interests in the entity that owns the property. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation and Consolidation — The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and note disclosures required by generally accepted accounting principles in the United States (“GAAP”). The unaudited condensed consolidated financial statements reflect all normal recurring adjustments, which, in the opinion of management, are necessary for the fair statement of the Company’s results for the interim period presented. Operating results for the nine months ended September 30, 2016 may not be indicative of the results that may be expected for the year ending December 31, 2016. Amounts as of December 31, 2015 included in the unaudited condensed consolidated financial statements have been derived from audited consolidated financial statements as of that date but do not include all disclosures required by GAAP. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s final prospectus filed with the SEC on March 2, 2016 and as supplemented to date. The accompanying unaudited condensed consolidated financial statements include the Company’s accounts and its subsidiaries, the Operating Partnership and the Operating Partnership’s general partner, CHP II GP, LLC. All material intercompany accounts and transactions have been eliminated in consolidation. Use of Estimates — The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts in the Company’s unaudited condensed consolidated financial statements and accompanying notes. Actual results could differ from those estimates. Cash — Cash consists of demand deposits at commercial banks with original maturities of three months or less. Restricted Cash — Certain amounts of cash are restricted as security to repay the Company’s notes payable and two semi-annual interest payments until the Company raises at least $10 million in gross proceeds in the Offering. 2. Summary of Significant Accounting Policies (continued) Income Taxes — The Company intends to qualify for taxation as a REIT under Sections 856 through 860 of the Internal Revenue Code commencing with its taxable year ending December 31, 2016 or the first year in which the Company commences material operations. Prior to the Company’s REIT election, it is subject to corporate federal and state income taxes. If the Company qualifies for taxation as a REIT, the Company generally will not be subject to federal corporate income tax to the extent it distributes at least 90 percent of its REIT taxable income to its stockholders. REITs are subject to a number of other organizational and operational requirements. Even if the Company qualifies for taxation 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. For the nine months ended September 30, 2016, the Company had no taxable income. The Company expects to form one or more subsidiaries that may elect to be taxed as a TRS for U.S. federal income tax purposes. Under the provisions of the Internal Revenue Code and applicable state laws, a TRS will be subject to taxation on taxable income from its operations. The Company will account for federal and state income taxes with respect to a TRS using the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the consolidated financial statement carrying amounts of existing assets and liabilities and respective tax bases and operating losses and tax-credit carry forwards. Fair Value Measurements — GAAP emphasizes that fair value is a market-based measurement, not an entity-specific measurement. Therefore, a fair value measurement should be determined based on the assumptions that market participants would use in pricing the asset or liability. GAAP requires the use of observable market data, when available, in making fair value measurements. Observable inputs are inputs that the market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of ours. When market data inputs are unobservable, the Company utilizes inputs that it believes reflects the Company’s best estimate of the assumptions market participants would use in pricing the asset or liability. When inputs used to measure fair value fall within different levels of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement. As a basis for considering market participant assumptions in fair value measurements, GAAP establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy). The three levels of inputs used to measure fair value are as follows: • Level 1 – Quoted prices (unadjusted in active markets for identical assets or liabilities that the Company as the ability to access. • Level 2 – Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. • Level 3 – Unobservable inputs for the asset or liability, which are typically based on the Company’s own assumptions, as there is little, if any, related market activity. Per Share Data — Basic loss per share attributable to common stockholders for all periods presented are computed by dividing net loss by the weighted average number of common stock shares outstanding during the period for each share class. Diluted loss per share is computed based on the weighted average number of common stock shares outstanding during the period for each share class and all potentially dilutive securities, if any. For purposes of determining the weighted average number of shares of common stock outstanding, stock dividends are treated as if they were outstanding as of the beginning of the periods presented. 2. Summary of Significant Accounting Policies (continued) Adopted Accounting Pronouncements — In February 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2015-02, “Amendments to the Consolidation Analysis,” which requires amendments to both the variable interest entity and voting models. The amendments (i) modify the identification of variable interests (fees paid to a decision maker or service provider), the VIE characteristics for a limited partnership or similar entity and primary beneficiary determination under the VIE model, and (ii) eliminate the presumption within the current voting model that a general partner controls a limited partnership or similar entity. The new guidance is effective for annual reporting periods, and interim periods within those annual periods, beginning after December 15, 2015 with early adoption permitted. The amendments may be applied using either a modified retrospective or full retrospective approach. The Company adopted ASU 2015-02 on January 1, 2016; the adoption of which did not have a material impact on the Company’s consolidated financial statements. In April 2015, the FASB issued ASU 2015-03, “Interest-Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs,” which requires that loan costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts or premiums. The new guidance is effective for annual reporting periods, and interim periods within those annual periods, beginning after December 15, 2015 with early adoption permitted. The ASU is to be applied retrospectively for each period presented. Upon adoption, an entity is required to comply with the applicable disclosures for a change in an accounting principle. The FASB subsequently issued ASU 2015-15, “Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements,” which clarifies that, given the absence of authoritative guidance in ASU 2015-03 regarding presentation and subsequent measurement of loan costs related to line-of-credit arrangements, the SEC Staff would not object to an entity deferring and presenting loan costs as an asset and subsequently amortizing the loan costs ratably over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. The Company adopted ASU 2015-03 on January 1, 2016; the adoption of which did not have a material impact on the Company’s consolidated financial statements. In September 2015, the FASB issued ASU 2015-16, “Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments,” which requires an acquirer to recognize provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The amendments require that the acquirer record, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization, or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the accounting had been completed at the acquisition date. The new guidance is effective for annual reporting periods, and interim periods within those annual periods, beginning after December 15, 2015 with early adoption permitted. The Company adopted ASU 2015-16 on January 1, 2016; the adoption of which did not have a material impact on the Company’s consolidated financial statements. Recent Accounting Pronouncements — In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers,” as a new ASC topic (Topic 606). The core principle of this ASU is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The ASU further provides guidance for any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets, unless those contracts are within the scope of other standards (for example, lease contracts). The FASB subsequently issued ASU 2015-14 to defer the effective date of ASU 2014-09 until annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period, with earlier adoption permitted. ASU 2014-09 can be adopted using one of two retrospective transition methods: 1) retrospectively to each prior reporting period presented or 2) as a cumulative-effect adjustment as of the date of adoption. The Company has not yet selected a transition method and is currently evaluating the impact this ASU will have on the Company’s consolidated statements. 2. Summary of Significant Accounting Policies (continued) In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842): Accounting for Leases,” which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e. lessees and lessors). The ASU requires lessees to recognize assets and liabilities on the balance sheet for the rights and obligations created by all leases with terms of more than 12 months. The ASU further modifies lessors’ classification criteria for leases and the accounting for sales-type and direct financing leases. The ASU will also require qualitative and quantitative disclosures designed to give financial statement users additional information on the amount, timing, and uncertainty of cash flows arising from leases. The ASU is effective for annual reporting periods, and interim periods within those annual periods, beginning after December 15, 2018 with early adoption permitted. The ASU is to be applied using a modified retrospective approach. The Company is currently evaluating the impact this ASU will have on the Company’s consolidated financial statements. In August 2016, the FASB issued ASU 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments,” which will make eight targeted changes to how cash receipts and cash payments are presented and classified in the statement of cash flows. The ASU further clarifies how the predominance principle should be applied to cash receipts and payments relating to more than one class of cash flows. The ASU is effective for annual reporting periods, and interim periods within those annual periods, beginning after December 15, 2017. The ASU is to be applied retrospectively for each period presented. The Company is currently evaluating the impact this ASU will have on the Company’s consolidated statement of cash flows. |
Indebtedness
Indebtedness | 9 Months Ended |
Sep. 30, 2016 | |
Debt Disclosure [Abstract] | |
Indebtedness | 3. Indebtedness In August 2016, the Company, through its operating partnership, issued promissory notes to each of 125 separate investors (each “Note” and collectively the “Notes”) for a total principal amount of approximately $0.3 million. The Company will pay interest on the Notes in the amount of $564 per annum per Note payable semi-annually in arrears. The Notes mature on June 30, 2046. Some or all of the Notes may be prepaid at any time, in whole or in part, provided that (i) such prepayment include all accrued and unpaid interest due on such prepaid principal amount to and including the date of prepayment and (ii) if the prepayment occurs prior to the second anniversary of the issue date of the Note, the Company will pay on the date of such prepayment a one-time premium equal to $250 per Note. In connection with the issuance of the Notes, the Company’s Advisor placed $0.4 million into a third-party escrow account to be held to repay the principal of the Notes and two semi-annual interest payments, which funds shall be released from escrow upon the Company raising at least $10 million in gross proceeds in the Offering. The fair market value of the Notes was approximately $0.4 million as of September 30, 2016, which is based on current rates and spreads the Company would expect to obtain for similar borrowings. Since this methodology includes inputs that are less observable by the public and are not necessarily reflected in active markets, the measurement of the estimated fair values is categorized as Level 3 on the three-level valuation hierarchy. |
Related Party Arrangements
Related Party Arrangements | 9 Months Ended |
Sep. 30, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Arrangements | 4. Related Party Arrangements The Company expects that the Advisor and certain affiliates of the Advisor will receive fees and compensation in connection with the Offering and the acquisition, management and sale of the assets of the Company, as follows: Dealer Manager — The Dealer Manager will receive a selling commission of up to 7% of the sale price for each Class A share and 2% of the sale price for each Class T share sold in the Primary Offering, all or a portion of which may be reallowed to participating broker dealers. In addition, the Dealer Manager will receive a dealer manager fee in an amount equal to 2.75% of the price of each Class A share or Class T share sold in the Primary Offering, all or a portion of which may be reallowed to participating broker dealers. 4. Related Party Arrangements (continued) The Company will pay a distribution and stockholder servicing fee, subject to certain underwriting compensation limits, with respect to the Class T and Class I shares sold in the Primary Offering in an annual amount equal to 1% and 0.50%, respectively, of the current gross offering price per Class T or Class I share, respectively, or if the Company is no longer offering shares in a public offering, the estimated per share value per Class T or Class I share, respectively. If the Company reports an estimated per share value prior to the termination of the Primary Offering, the annual distribution and stockholder servicing fee will continue to be calculated as a percentage of the current gross offering price per Class T or Class I share until the Company reports an estimated per share value following the termination of the Primary Offering, at which point the distribution fee will be calculated based on the new estimated per share value, until such underwriting compensation limits are met or the shares are converted to Class A shares pursuant to the terms of the securities. Advisor — The Company will pay the Advisor a monthly asset management fee in an amount equal to 0.0667% of the monthly average of the sum of the Company’s and the Operating Partnership’s respective daily real estate asset value, without duplication, plus the outstanding principal amount of any loans made, plus the amount invested in other permitted investments. For this purpose, “real estate asset value” equals the amount invested in wholly-owned properties, determined on the basis of cost, and in the case of properties owned by any joint venture or partnership in which the Company is a co-venturer or partner the portion of the cost of such properties paid by the Company, exclusive of acquisition fees and acquisition expenses and will not be reduced for any recognized impairment. Any recognized impairment loss will not reduce the real estate asset value for the purposes of calculating the asset management fee. The asset management fee, which will not exceed fees which are competitive for similar services in the same geographic area, may or may not be taken, in whole or in part as to any year, in the Advisor’s sole discretion. All or any portion of the asset management fee not taken as to any fiscal year shall be deferred without interest and may be taken in such other fiscal year as the Advisor shall determine. The Company will pay the Advisor a construction management fee of up to 1% of hard and soft costs associated with the initial construction or renovation of a property, or with the management and oversight of expansion projects and other capital improvements, in those cases in which the value of the construction, renovation, expansion or improvements exceeds (i) 10% of the initial purchase price of the property and (ii) $1 million in which case such fee will be due and payable as draws are funded for such projects. The Advisor will receive an investment services fee of 2.25% of the purchase price of properties and funds advanced for loans or the amount invested in the case of other assets for services in connection with the selection, evaluation, structure and purchase of assets. No investment services fee will be paid to the Advisor in connection with the Company’s purchase of securities. The Advisor, its affiliates and related parties also are entitled to reimbursement of certain operating expenses in connection with their provision of services to the Company, including personnel costs, subject to the limitation that the Company will not reimburse the Advisor for any amount by which operating expenses exceed the greater of 2% of its average invested assets or 25% of its net income in any expense year unless approved by the independent directors. The Advisor will pay all other organizational and offering expenses incurred in connection with the formation of the Company, as well as certain expenses related to the Offering, without reimbursement by the Company. These expenses include, but are not limited to, SEC registration fees, FINRA filing fees, printing and mailing expenses, blue sky fees and expenses, legal fees and expenses, accounting fees and expenses, advertising and sales literature, transfer agent fees, due diligence expenses, personnel costs associated with processing investor subscriptions, escrow fees and other administrative expenses of the Offering. 4. Related Party Arrangements (continued) The Company entered into an amended and restated expense support and restricted stock agreement with the Advisor pursuant to which the Advisor has agreed to accept payment in the form of forfeitable restricted Class A shares of common stock in lieu of cash for services rendered, in the event that the Company does not achieve established distribution coverage targets (“Expense Support Agreement”). In exchange for services rendered and in consideration of the expense support provided, the Company shall issue, following each determination date, a number of shares of restricted stock equal to the quotient of the expense support amount provided by the Advisor for the preceding quarter divided by the board of directors’ most recent determination of net asset value per share of the Class A common shares, if the board has made such a determination, or otherwise the most recent public offering price per Class A common share, on the terms and conditions and subject to the restrictions set forth in the Expense Support Agreement. The Restricted Stock is subordinated and forfeited to the extent that shareholders do not receive a Priority Return on their Invested Capital (as defined in the prospectus), excluding for the purposes of calculating this threshold any shares of restricted stock owned by the Advisor. CNL Capital Markets Corp. — The Company will pay CNL Capital Markets Corp., an affiliate of CNL, an annual fee payable monthly based on the average number of total investor accounts that will be open during the term of the capital markets service agreement pursuant to which certain administrative services are provided to the Company. These services may include, but are not limited to, the facilitation and coordination of the transfer agent’s activities, client services and administrative call center activities, financial advisor administrative correspondence services, material distribution services and various reporting and troubleshooting activities. The fees payable to the Dealer Manager in connection with the Offering for the quarter and nine months ended September 30, 2016, and related amounts unpaid as of September 30, 2016 are as follows: Quarter Ended Nine Months Ended Unpaid amounts as of (1) September 30, September 30, September 30, 2016 2016 2016 Selling commissions (2) $ 1,550 $ 1,550 $ — Dealer Manager fees (2) 756 756 — Distribution and stockholder servicing fees (2) 375 375 375 $ 2,681 $ 2,681 $ 375 The expenses incurred by and reimbursable to the Company’s related parties for the quarter and nine months ended September 30, 2016, and related amounts unpaid as of September 30, 2016 are as follows: Quarter Ended Nine Months Ended Unpaid amounts as of (1) September 30, September 30, September 30, 2016 2016 2016 Reimbursable expenses: Operating expenses (3) $ 132,098 $ 132,098 $ 384,492 $ 132,098 $ 132,098 $ 384,492 FOOTNOTES: (1) Amounts are recorded as due to related parties in the accompanying condensed consolidated balance sheets. (2) Amounts are recorded as stock issuance and offering costs in the accompanying condensed consolidated statements of stockholders’ equity. (3) Amounts are recorded as general and administrative expenses in the accompanying condensed consolidated statements of operations unless such amounts represent prepaid expenses, which are capitalized in the accompanying condensed consolidated balance sheets. |
Equity
Equity | 9 Months Ended |
Sep. 30, 2016 | |
Equity [Abstract] | |
Equity | 5. Equity Public Offering — As of September 30, 2016, the Company had received aggregate offering proceeds of approximately $3.0 million (0.3 million shares). Distributions — During the nine months ended September 30, 2016, the Company declared cash distributions of approximately $21,000, of which approximately $2,000 and $19,000 were paid in cash to stockholders and the Advisor, respectively. In addition, the Company declared and made stock dividends of approximately 1,000 shares of common stock during the nine months ended September 30, 2016, of which approximately 100 and 1,000 shares were made to stockholders and the Advisor, respectively. For the nine months ended September 30, 2016, 100.0% of the cash distributions paid to stockholders were considered a return of capital to stockholders for federal income tax purposes. No amounts distributed to stockholders for the nine months ended September 30, 2016 were required to be or have been treated by the Company as a return of capital for purposes of calculating the stockholders’ return on their invested capital as described in the Company’s advisory agreement. The distribution of new common shares to recipients is non-taxable. |
Commitment and Contingencies
Commitment and Contingencies | 9 Months Ended |
Sep. 30, 2016 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 6. Commitments and Contingencies From time to time, the Company may be a party to legal proceedings in the ordinary course of, or incidental to the normal course of, its business, including proceedings to enforce its contractual or statutory rights. While the Company cannot predict the outcome of these legal proceedings with certainty, based upon currently available information, the Company does not believe the final outcome of any pending or threatened legal proceeding will have a material adverse effect on its results of operations or financial condition. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events | 7. Subsequent Events Distributions Authorized and Paid The Company’s board of directors declared a monthly cash distribution of $0.0350 and a monthly stock dividend of 0.001881250 shares on each outstanding share of common stock on October 1, 2016 and November 1, 2016. These dividends are to be paid and distributed by December 31, 2016. Equity Transactions During the period from October 1, 2016 through November 4, 2016, the Company received additional subscription proceeds of approximately $0.9 million (0.09 million shares). Escrow Reimbursement In October 2016, the Company reimbursed the Advisor for the $0.4 million placed into a third-party escrow in connection to the issuance of the Notes. |
Summary of Significant Accoun14
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Consolidation | Basis of Presentation and Consolidation — The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and note disclosures required by generally accepted accounting principles in the United States (“GAAP”). The unaudited condensed consolidated financial statements reflect all normal recurring adjustments, which, in the opinion of management, are necessary for the fair statement of the Company’s results for the interim period presented. Operating results for the nine months ended September 30, 2016 may not be indicative of the results that may be expected for the year ending December 31, 2016. Amounts as of December 31, 2015 included in the unaudited condensed consolidated financial statements have been derived from audited consolidated financial statements as of that date but do not include all disclosures required by GAAP. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s final prospectus filed with the SEC on March 2, 2016 and as supplemented to date. The accompanying unaudited condensed consolidated financial statements include the Company’s accounts and its subsidiaries, the Operating Partnership and the Operating Partnership’s general partner, CHP II GP, LLC. All material intercompany accounts and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates — The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts in the Company’s unaudited condensed consolidated financial statements and accompanying notes. Actual results could differ from those estimates. |
Cash | Cash — Cash consists of demand deposits at commercial banks with original maturities of three months or less. |
Restricted Cash | Restricted Cash — Certain amounts of cash are restricted as security to repay the Company’s notes payable and two semi-annual interest payments until the Company raises at least $10 million in gross proceeds in the Offering. |
Income Taxes | Income Taxes — The Company intends to qualify for taxation as a REIT under Sections 856 through 860 of the Internal Revenue Code commencing with its taxable year ending December 31, 2016 or the first year in which the Company commences material operations. Prior to the Company’s REIT election, it is subject to corporate federal and state income taxes. If the Company qualifies for taxation as a REIT, the Company generally will not be subject to federal corporate income tax to the extent it distributes at least 90 percent of its REIT taxable income to its stockholders. REITs are subject to a number of other organizational and operational requirements. Even if the Company qualifies for taxation 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. For the nine months ended September 30, 2016, the Company had no taxable income. The Company expects to form one or more subsidiaries that may elect to be taxed as a TRS for U.S. federal income tax purposes. Under the provisions of the Internal Revenue Code and applicable state laws, a TRS will be subject to taxation on taxable income from its operations. The Company will account for federal and state income taxes with respect to a TRS using the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the consolidated financial statement carrying amounts of existing assets and liabilities and respective tax bases and operating losses and tax-credit carry forwards. |
Fair Value Measurements | Fair Value Measurements — GAAP emphasizes that fair value is a market-based measurement, not an entity-specific measurement. Therefore, a fair value measurement should be determined based on the assumptions that market participants would use in pricing the asset or liability. GAAP requires the use of observable market data, when available, in making fair value measurements. Observable inputs are inputs that the market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of ours. When market data inputs are unobservable, the Company utilizes inputs that it believes reflects the Company’s best estimate of the assumptions market participants would use in pricing the asset or liability. When inputs used to measure fair value fall within different levels of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement. As a basis for considering market participant assumptions in fair value measurements, GAAP establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy). The three levels of inputs used to measure fair value are as follows: • Level 1 – Quoted prices (unadjusted in active markets for identical assets or liabilities that the Company as the ability to access. • Level 2 – Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. • Level 3 – Unobservable inputs for the asset or liability, which are typically based on the Company’s own assumptions, as there is little, if any, related market activity. |
Per Share Data | Per Share Data — Basic loss per share attributable to common stockholders for all periods presented are computed by dividing net loss by the weighted average number of common stock shares outstanding during the period for each share class. Diluted loss per share is computed based on the weighted average number of common stock shares outstanding during the period for each share class and all potentially dilutive securities, if any. For purposes of determining the weighted average number of shares of common stock outstanding, stock dividends are treated as if they were outstanding as of the beginning of the periods presented. |
Adopted Accounting Pronouncements | Adopted Accounting Pronouncements — In February 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2015-02, “Amendments to the Consolidation Analysis,” which requires amendments to both the variable interest entity and voting models. The amendments (i) modify the identification of variable interests (fees paid to a decision maker or service provider), the VIE characteristics for a limited partnership or similar entity and primary beneficiary determination under the VIE model, and (ii) eliminate the presumption within the current voting model that a general partner controls a limited partnership or similar entity. The new guidance is effective for annual reporting periods, and interim periods within those annual periods, beginning after December 15, 2015 with early adoption permitted. The amendments may be applied using either a modified retrospective or full retrospective approach. The Company adopted ASU 2015-02 on January 1, 2016; the adoption of which did not have a material impact on the Company’s consolidated financial statements. In April 2015, the FASB issued ASU 2015-03, “Interest-Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs,” which requires that loan costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts or premiums. The new guidance is effective for annual reporting periods, and interim periods within those annual periods, beginning after December 15, 2015 with early adoption permitted. The ASU is to be applied retrospectively for each period presented. Upon adoption, an entity is required to comply with the applicable disclosures for a change in an accounting principle. The FASB subsequently issued ASU 2015-15, “Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements,” which clarifies that, given the absence of authoritative guidance in ASU 2015-03 regarding presentation and subsequent measurement of loan costs related to line-of-credit arrangements, the SEC Staff would not object to an entity deferring and presenting loan costs as an asset and subsequently amortizing the loan costs ratably over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. The Company adopted ASU 2015-03 on January 1, 2016; the adoption of which did not have a material impact on the Company’s consolidated financial statements. In September 2015, the FASB issued ASU 2015-16, “Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments,” which requires an acquirer to recognize provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The amendments require that the acquirer record, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization, or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the accounting had been completed at the acquisition date. The new guidance is effective for annual reporting periods, and interim periods within those annual periods, beginning after December 15, 2015 with early adoption permitted. The Company adopted ASU 2015-16 on January 1, 2016; the adoption of which did not have a material impact on the Company’s consolidated financial statements. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements — In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers,” as a new ASC topic (Topic 606). The core principle of this ASU is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The ASU further provides guidance for any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets, unless those contracts are within the scope of other standards (for example, lease contracts). The FASB subsequently issued ASU 2015-14 to defer the effective date of ASU 2014-09 until annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period, with earlier adoption permitted. ASU 2014-09 can be adopted using one of two retrospective transition methods: 1) retrospectively to each prior reporting period presented or 2) as a cumulative-effect adjustment as of the date of adoption. The Company has not yet selected a transition method and is currently evaluating the impact this ASU will have on the Company’s consolidated statements. 2. Summary of Significant Accounting Policies (continued) In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842): Accounting for Leases,” which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e. lessees and lessors). The ASU requires lessees to recognize assets and liabilities on the balance sheet for the rights and obligations created by all leases with terms of more than 12 months. The ASU further modifies lessors’ classification criteria for leases and the accounting for sales-type and direct financing leases. The ASU will also require qualitative and quantitative disclosures designed to give financial statement users additional information on the amount, timing, and uncertainty of cash flows arising from leases. The ASU is effective for annual reporting periods, and interim periods within those annual periods, beginning after December 15, 2018 with early adoption permitted. The ASU is to be applied using a modified retrospective approach. The Company is currently evaluating the impact this ASU will have on the Company’s consolidated financial statements. In August 2016, the FASB issued ASU 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments,” which will make eight targeted changes to how cash receipts and cash payments are presented and classified in the statement of cash flows. The ASU further clarifies how the predominance principle should be applied to cash receipts and payments relating to more than one class of cash flows. The ASU is effective for annual reporting periods, and interim periods within those annual periods, beginning after December 15, 2017. The ASU is to be applied retrospectively for each period presented. The Company is currently evaluating the impact this ASU will have on the Company’s consolidated statement of cash flows. |
Related Party Arrangements (Tab
Related Party Arrangements (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Fees and Expenses Incurred and Reimbursable to Affiliates and Related Parties | The expenses incurred by and reimbursable to the Company’s related parties for the quarter and nine months ended September 30, 2016, and related amounts unpaid as of September 30, 2016 are as follows: Quarter Ended Nine Months Ended Unpaid amounts as of (1) September 30, September 30, September 30, 2016 2016 2016 Reimbursable expenses: Operating expenses (3) $ 132,098 $ 132,098 $ 384,492 $ 132,098 $ 132,098 $ 384,492 FOOTNOTES: (1) Amounts are recorded as due to related parties in the accompanying condensed consolidated balance sheets. (2) Amounts are recorded as stock issuance and offering costs in the accompanying condensed consolidated statements of stockholders’ equity. (3) Amounts are recorded as general and administrative expenses in the accompanying condensed consolidated statements of operations unless such amounts represent prepaid expenses, which are capitalized in the accompanying condensed consolidated balance sheets. |
Dealer Manager | |
Fees and Expenses Incurred and Reimbursable to Affiliates and Related Parties | The fees payable to the Dealer Manager in connection with the Offering for the quarter and nine months ended September 30, 2016, and related amounts unpaid as of September 30, 2016 are as follows: Quarter Ended Nine Months Ended Unpaid amounts as of (1) September 30, September 30, September 30, 2016 2016 2016 Selling commissions (2) $ 1,550 $ 1,550 $ — Dealer Manager fees (2) 756 756 — Distribution and stockholder servicing fees (2) 375 375 375 $ 2,681 $ 2,681 $ 375 FOOTNOTES: (1) Amounts are recorded as due to related parties in the accompanying condensed consolidated balance sheets. (2) Amounts are recorded as stock issuance and offering costs in the accompanying condensed consolidated statements of stockholders’ equity. (3) Amounts are recorded as general and administrative expenses in the accompanying condensed consolidated statements of operations unless such amounts represent prepaid expenses, which are capitalized in the accompanying condensed consolidated balance sheets. |
Organization - Additional Infor
Organization - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Dec. 31, 2015 | Sep. 30, 2016 | Jul. 11, 2016 | Mar. 02, 2016 | |
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Common stock, shares sold | 300,000 | ||||
Aggregate purchase price | $ 200,000 | $ 2,778,749 | |||
Selling commissions or dealer manager fees | 2,306 | ||||
Minimum offering amount | $ 2,000,000 | ||||
Sale of common stock, shares | 20,000 | ||||
Sale of common stock, value | $ 200 | ||||
Initial Public Offering | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Common stock, value authorized | $ 1,750,000,000 | ||||
Reinvestment Plan | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Common stock, value authorized | $ 250,000,000 | ||||
Advisor | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Common stock, shares sold | 20,000 | ||||
Aggregate purchase price | $ 200,000 | ||||
Selling commissions or dealer manager fees | $ 0 | ||||
Class A Common Stock | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Common stock, shares sold | 260,180 | ||||
Aggregate purchase price | $ 2,602 | ||||
Conversion of shares | 20,000 | ||||
Sale of common stock, shares | 281,227 | ||||
Sale of common stock, value | $ 2,812 | ||||
Class A Common Stock | Advisor | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Conversion of shares | 20,000 | ||||
Sale of common stock, shares | 250,000 | ||||
Sale of common stock, value | $ 2,500,000 |
Summary of Significant Accoun17
Summary of Significant Accounting Policies - Additional Information (Details) | 9 Months Ended |
Sep. 30, 2016USD ($) | |
Summary Of Significant Accounting Policies [Line Items] | |
Restricted cash as security until minimum gross proceeds in offering | $ 10,000,000 |
Taxable income | $ 0 |
Minimum | |
Summary Of Significant Accounting Policies [Line Items] | |
Percentage of taxable income for distribution to stockholders | 90.00% |
Indebtedness - Additional Infor
Indebtedness - Additional Information (Details) | 1 Months Ended | 9 Months Ended |
Aug. 31, 2016USD ($)Investor | Sep. 30, 2016USD ($) | |
Level 3 | ||
Debt Instrument [Line Items] | ||
Notes, fair market value | $ 400,000 | |
Promissory Notes | ||
Debt Instrument [Line Items] | ||
Number of investors | Investor | 125 | |
Debt instrument, principal amount | $ 300,000 | |
Annual interest payable per note | 564 | |
Debt instrument, payment terms | The Company will pay interest on the Notes in the amount of $564 per annum per Note payable semi-annually in arrears. The Notes mature on June 30, 2046. Some or all of the Notes may be prepaid at any time, in whole or in part, provided that (i) such prepayment include all accrued and unpaid interest due on such prepaid principal amount to and including the date of prepayment and (ii) if the prepayment occurs prior to the second anniversary of the issue date of the Note, the Company will pay on the date of such prepayment a one-time premium equal to $250 per Note. In connection with the issuance of the Notes, the Company’s Advisor placed $0.4 million into a third-party escrow account to be held to repay the principal of the Notes and two semi-annual interest payments, which funds shall be released from escrow upon the Company raising at least $10 million in gross proceeds in the Offering. | |
Debt instrument, maturity date | Jun. 30, 2046 | |
Amount held on third-party escrow account | 400,000 | |
Proceeds from issuance initial public offering | $ 10,000,000 | |
One-time premium per note | $ 250 |
Related Party Arrangements - Ad
Related Party Arrangements - Additional Information (Details) | 9 Months Ended |
Sep. 30, 2016USD ($) | |
Advisor | |
Related Party Transaction [Line Items] | |
Monthly asset management fee as percentage of real estate value | 0.0667% |
Initial purchase price of property percentage | 10.00% |
Property management fee | $ 1,000,000 |
Investment service fee as percentage of purchase price of properties | 2.25% |
Investment services fee | $ 0 |
Maximum | Advisor | |
Related Party Transaction [Line Items] | |
Construction management fee as percentage of hard and soft costs | 1.00% |
Operating expenses reimbursement percentage of average invested assets | 2.00% |
Operating expenses reimbursement percentage of net income | 25.00% |
Class A Common Stock | |
Related Party Transaction [Line Items] | |
Dealer manager fee | 2.75% |
Class A Common Stock | Maximum | |
Related Party Transaction [Line Items] | |
Selling commission | 7.00% |
Class T Common Stock | |
Related Party Transaction [Line Items] | |
Selling commission | 2.00% |
Dealer manager fee | 2.75% |
Distribution and stockholder servicing fee | 1.00% |
Class I Common Stock | |
Related Party Transaction [Line Items] | |
Distribution and stockholder servicing fee | 0.50% |
Related Party Arrangements - Fe
Related Party Arrangements - Fees and Expenses Incurred and Reimbursable to Affiliates and Related Parties (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016USD ($) | Sep. 30, 2016USD ($) | |||
Related Party Transaction [Line Items] | ||||
Distribution and stockholder servicing fees | $ 375 | |||
Operating expenses | $ 132,098 | [1] | 132,098 | [1] |
Total reimbursable expenses | 132,098 | 132,098 | ||
Operating expenses, Unpaid amount | 384,492 | [2] | 384,492 | [2] |
Related parties, Unpaid amount | 384,492 | [2] | 384,492 | [2] |
Dealer Manager | ||||
Related Party Transaction [Line Items] | ||||
Selling commissions | 1,550 | [3] | 1,550 | [3] |
Dealer Manager fees | 756 | [3] | 756 | [3] |
Distribution and stockholder servicing fees | 375 | [3] | 375 | [3] |
Total offering expenses | 2,681 | 2,681 | ||
Distribution and stockholder servicing fees, Unpaid amount | 375 | [2] | 375 | [2] |
Total offering expenses unpaid | $ 375 | [2] | $ 375 | [2] |
[1] | Amounts are recorded as general and administrative expenses in the accompanying condensed consolidated statements of operations unless such amounts represent prepaid expenses, which are capitalized in the accompanying condensed consolidated balance sheets. | |||
[2] | Amounts are recorded as due to related parties in the accompanying condensed consolidated balance sheets. | |||
[3] | Amounts are recorded as stock issuance and offering costs in the accompanying condensed consolidated statements of stockholders’ equity. |
Equity - Additional Information
Equity - Additional Information (Details) - USD ($) | 6 Months Ended | 9 Months Ended |
Dec. 31, 2015 | Sep. 30, 2016 | |
Class Of Stock [Line Items] | ||
Aggregate proceeds from public offering | $ 2,778,749 | |
Common stock, shares sold | 300,000 | |
Cash distributions declared | $ 20,662 | |
Cash distributions paid | $ 20,662 | |
Stock dividends issued | 1,000 | |
Percentage of cash distributions considered as return on capital for income tax purposes | 100.00% | |
Amount of distributions to stockholders considered as return of capital by the company | $ 0 | |
Stockholders | ||
Class Of Stock [Line Items] | ||
Cash distributions paid | $ 2,000 | |
Stock dividends issued | 100 | |
Advisor | ||
Class Of Stock [Line Items] | ||
Common stock, shares sold | 20,000 | |
Cash distributions paid | $ 19,000 | |
Stock dividends issued | 1,000 |
Subsequent Events - Additional
Subsequent Events - Additional Information (Details) - USD ($) | Nov. 01, 2016 | Nov. 04, 2016 | Oct. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2016 | Oct. 01, 2016 |
Subsequent Event [Line Items] | ||||||
Distributions to be paid and distributed date | Dec. 31, 2016 | |||||
Aggregate proceeds from public offering | $ 2,778,749 | |||||
Common stock, shares sold | 300,000 | |||||
Advisor | ||||||
Subsequent Event [Line Items] | ||||||
Common stock, shares sold | 20,000 | |||||
Subsequent Event | ||||||
Subsequent Event [Line Items] | ||||||
Monthly cash distributions per share | $ 0.0350 | |||||
Monthly stock dividend, shares | 0.001881250 | |||||
Aggregate proceeds from public offering | $ 900,000 | |||||
Common stock, shares sold | 90,000 | |||||
Subsequent Event | Advisor | ||||||
Subsequent Event [Line Items] | ||||||
Reimbursement of escrow deposit | $ 400,000 |